Introduction to Marketing

INTRODUCTION TO
MARKETINGMohammed Umair l M.Com, PGDBA, NET
Department of Business Administration l St. Joseph’s College
MARKETING MANAGEMENT: CHAPTER 1
Course Instructor⬌

Chapter 1: Introduction to MarketingMohammed Umair: Dept. of Commerce,St. Joseph’s College
CONCEPTUAL CLARITY
The Chartered Institute of Marketing define marketing as
'The management process responsible for identifying ,
anticipating and satisfying customer requirements profitably'
Philip Kotler says, “Marketing is a societal process by which individuals and
groups obtain what they need and want through creating, offering and freely
exchanging products and services of value with others”.
Marketing is a process of:-
 Identifying the wants of the people.
 Developing product or service to meet the wants of people.
 Recognize target customer among the people.
 Determining way of communicating the product to target customer.
WHAT IS MARKETING?
Products & services do not
move naturally from producer
to the consumer for this we
need a structured mechanism.

SALES VS. MARKETING
Meaning
Satisfying needs through an exchange process.
Effort to execute the exchange process.
MARKETING
SELLING
Inception
Starts before decision of production goods.
Starts after decision of production of goods or services.
MARKETING
SELLING
Subject Matter Satisfaction of consumers.Stresses needs of seller.
MARKETINGSELLING
Environment
Consideration both the internal and external factors
Selling is concerned with the internal factors .
MARKETING
SELLING
Scope
Marketing is a wider term, which, includes 4Ps
Selling is the part of marketing
MARKETING
SELLING
Subject Matter Short-run-oriented.Integrated approach .
MARKETINGSELLING

EVOLUTION OF MARKETING APPROACH
THE PRODUCT APPROACH
Products were sold at a low cost. SALES ORIENTATION APPROACH
Enhancing sales volume with promotion.
CUSTOMER ORIENTATION APPROACH
Supplying products to suit new consumer tastes.
SOCIAL ORIENTATION APPROACH
Marketing activities should not harm the society.
RELATIONSHIP MARKETING APPROACH
Building and keeping good customer relations.
VIRTUAL MARKETING APPROACH
Links the marketing activities to online world.
BRANDING
Emotional and psychological
relationship.
THE TRADE APPROACH
Exchange of household utilities for other goods.

SCOPE OF MARKETING
What Can We Market?
“Shawarma to Sunny Leone”
GOODS SERVICES EXPERIENCES
EVENTS PERSONS PLACES
PROPERTIES ORGANIZATIONS INFORMATION
IDEAS

SCOPE OF MARKETING
What Can We Market?
1. GOODS
 In economics, a good is a material that satisfies human wants and provides utility
Why marketing exist?
 Physical goods constitute the bulk of most countries’ production and marketing exercise.
2. SERVICES
 “A service is any act or performance that one party can offer to another that is essentially
intangible and does not result in the ownership of anything.”
Most of the economies across the globe have undergone major changes in terms of political
structure, economic reforms, financial reformation, demographic changes and other amendments.
Services Driven Economies
# Country Services
1 United States 79.70%
2 China 48.30%
3 Japan 71.40%
4 Germany 71.10%
5 France 79.80%
6 United Kingdom 78.30%
7 Brazil 67.20%
9 Russia 60.10%
8 Italy 73.80%
10 India 56.90%
Manufacturing Driven Economies
# Country Industry
1 Saudi Arabia 66.90%
2 United Arab Emirates 59.40%
3 Indonesia 46.90%
4 China 42.60%
5 Iran 40.60%
Agrarian Economies
# Country Agriculture
1 India 17.40%
2 Indonesia 14.30%
3 Thailand 13.30%
4 Iran 11.20%
5 Argentina 10%
Argiculture
Industry
Services
0.00% 10.00% 20.00% 30.00% 40.00% 50.00% 60.00% 70.00%
Sector wise contribution to world's GDP
Global Level
Agriculture Industry Services
5.90% 30.50% 63.60%
– Need and Wants.

SCOPE OF MARKETING
What Can We Market?
3. Experiences
 By incorporating several products and services a business enterprise can develop a customer experience.
Virgin Galactic is a company which plans to provide
spaceflights to space tourists.
IMAX records and display images of far greater size and
resolution than conventional film systems.
Disneyland in California boasts a large number
of attractions featuring rides, studio & clones.
4. EVENTS
Marketers promote duration specifics events. Sponsoring & promoting an event is an effective way to
simultaneously support producers in a business area and advertise products, services & brands of
business .
Sports Concerts & TV Shows
Indian Premier League (IPL): VIVO Film Fare Awards: Idea
English Premier League: Barclays Oscar: Hyundai, JC Penney and Coca-Cola
Indian Cricket Team: STAR Satyamev Jayate (TV show): Airtel

SCOPE OF MARKETING
What Can We Market?
5. Persons
 Marketers are attempting to quantify and qualify the use of celebrities in their marketing
campaigns by evaluating their awareness, appeal, and relevance to a brand's image and the
celebrity's influence on consumer buying behavior.
BOLLYWOOD CELEBRITIES AND THEIR BRAND ENDORSEMENTS VALUATIONS!
Rs. 2.5 Crores a day Rs. 5 to 7 crores a day Rs. 4 Crores a day Rs. 5 Crores a day Rs. 3 Crores a dayRs. 2 to 3 Crores a day
Lingaa - Earned Rs 2 crore
Baba - Refund the money
Kabali – Fans disappointed
BRAND RAJANI
Fuddu
Beiimaan Love
One Night Stand
Mastizaade
BRAND SUNNY LEONE
Brand ambassadors have become a vital component of marketing in the present business
environment.
1. MS Dhoni
2. Sachin Tendulkar
3. Virat Kohli
4. Gautam Gambhir
5. Sourav Ganguly
TOP 5 RICHEST CRICKETERS IN INDIA 2016

SCOPE OF MARKETING
What Can We Market?
6. Places
 This includes towns, cities, states and whole country engaged in attracting tourists, investors,
companies and NRIs.
PURPOSE OF TOURISM: INDIAN PERSPECTIVE
• It means going out and visiting places of religious merit.Tirthatana
• It means going out for pleasure and knowledge.Paryatana
• It means going out of the country primarily for economic gains.Deshatana
Mecca is a city in Saudi Arabia
Population in 2 million
Populationduring Hajj period 6 Million
Hajj period (pilgrimage) held in
one of the Muslim lunar month. It
is the birthplace of Prophet
Muhammad (peace be upon him)
and a site of the composition of
the Quran.
Mecca is regarded as the holiest
city in the religion of Islam and
a pilgrimage is obligatory upon
all able Muslims.
RANK DESTINATION
1 France
2 United States
3 Spain
4 China
5 Italy
6 Turkey
7 Germany
8 United Kingdom
9 Mexico
10 Russia
World’s top 10 tourism
destinations
Place marketers include economic development specialists, real estate agents, commercial banks, local business
associations, advertising and public relations agencies

SCOPE OF MARKETING
What Can We Market?
7. Property
 Anything that is owned by a person or entity.
 In order to buy and sell these properties marketing is
required.
Types of properties
Financial property
Investment Firms
Intellectual property
Licensing agreements
Real estate
Developers/Agents
8. Organizations
Organizations spend huge funds on corporate identity ads.
Organizations/Brands Taglines
Intel Corporation Sponsors of Tomorrow
HSBC The world’s Local Bank
Infosys Powered by intellect. Driven by values.
Nike Just Do it
Coca Cola Open happiness

SCOPE OF MARKETING
What Can We Market?
9. Ideas
 Products & services offered by marketers possess a basic idea which becomes the basic essence.
Products and services are avenues through which ideas of organization are sold to satisfy a core need of the
customer.
10. Information
 Information assets comprise a wide range of corporate product, service and process information.
 Developing an Information asset requires defining the issue to be resolved, identifying the needed
Information, capturing the Information through a documentation process and constructing a framework to
allow easy access to the Information for the groups who would most benefit.

FUNCTION OF MARKETING
What Can We Market?
Marketing function begins from identifying the needs of customers and ends with
satisfaction of these needs.
EXCHANGE FUNCTIONS
• Buying
• Selling
• Pricing
• Assembling
SUPPLY CHAIN FUNCTIONS
• Transportation
• Storage
• Retailing
• Stock Management
• Standardisation
UTILITY FUNCTIONS
• Financing
• Marketing Information
• Customer Service
• Promotion

Changing nature of Human Wants
Hangout Spots in 1980s
• Parks
• Gardens
• Melas
• Grandparents House
• Hotels & Restaurants
Hangout Spots now
• Shopping Malls
• Clubs, Pubs, Disco
• Resorts
• Amusement Parks
• CCD, KFC, Mac Donald’s
ENVIRONMENTAL SCANNING

OLD TECHNOLOGY VS EMERGING TECHNOLOGIES
• Old Technology
• When was the
last time you
wrote a paper
check?
New technology
• New technology has given us ATM cards, check cards and credit cards.
• We pay bills and everything else on line or over the phone.
• Stores prefer the new technology that cuts down on losses and lines.
• Consumers love the new convenience and speed. Those old paper checks
are just not as useful as the new technology.
◦ Travel Guide ◦ People find their way around using new GPS technology.
◦ The old
technology of
VCR's. the old TV,
Video stores.
◦ The old technology of VCR's has been replaced by new DVD's. Now we have the
new technology of Blue Ray that may overtake those as well.
◦ Video stores are disappearing as more people use the new technology of red
box $1.00 rentals and on line video.
◦ Pretty soon the old TV may be gone as new computer viewing options get better
and better.
◦ Old reliable items are being phased out by new technology. As technology advances, so do our
needs. Old technology is constantly being phased out by new inventions. Here is a list of old items
soon to be replaced by new technology.

“Success always comes when
preparation meets opportunity”
-Henry Hartman
Environmental scanning is the acquisition and use of
information about events, trends, and relationships in
an organization's external environment, the knowledge
of which would assist management in planning the
organization's future course of action
1. Identification of SWOT
2. Optimum use of resources
3. Survival and growth
4. To plan long-term business strategy
An environmental analysis is an extremely important tool in
understanding and decision making in all situation of the
business. Success of the firm depends upon the precise
decision making ability
Objective and significance of
Environmental Analysis

MARKETING
ENVIRONMENT
 Functional areas
 Suppliers
 Intermediaries
 Customer
 Competitors
 Share Holders
 Political
 Economic
 Socio-cultural
 Technological
 Natural
 Legal
 Demographics
Micro Environment
Macro Environment
Micro-environment signifies
factors and forces over
which the marketing firm
has control, these factors
and forces can be modified
in order to provide
complete customer
satisfaction
Macro-environment refers to
all major external factors and
forces over which the
marketing firm has no control.
COMPONENTS OF MARKETING ENVIRONMENT

MICRO ENVIRONMENT
Departments in a business organization are structured according to certain functions.
The departments of various organizations will differ depending on the type of
business. Below are four main functions that tend to be general to most organizations.
Functional areas of Business
R&D
Improving existing products
Explore new ways of producing
Controlling costs
Efficient methods of production
Quality Management
PRODUCTION
Raw material
Transportation
Expansion of production capacity
Operational expenses
Plant and Machinery
MARKETING
Product development
Promotion activities
Distribution activities
Pricing activities
Customer Delight
HUMAN RESOURCE
Talent Acquisition and Retention
Human Resource Development
Compensation Management
Employee health an d safety
Social security

Name of
Firm
Nature of Business
Funds
Procured
recently
How the funds were mobilized? Net Profit
Firm Value
Per Share
Bharthi
Infratel
Telecom tower infrastructure providers which
deploys, owns and manages telecom towers
and communicationstructures for all
wireless operators
Rs 4,500
Crore
1. Installation of 4,813 new towers;
2. Up gradation and replacement on existing towers;
3. Green initiatives at tower sites;
4. General corporate purposes; and
Rs. 462.80
Crores
Rs. 279.15
Rs. 200
Just Dial Local Search Engine: providing local search
services over the Phone, Web, Mobile and
SMS.
Rs. 327
crore
The funds will be used for expansion and to
upgrade technology.
Rs. 31.49
Crores
Rs. 1,495
Rs. 530
PC Jeweller
Ltd
Operations include the manufacture, retail
and wholesale of jewellery.
Rs. 609.30
Crore
1. Finance establishment of new showrooms;
2. General corporate purposes.
Rs. 69.59
Crores
Rs. 236
Rs. 135
Coffee Day
Enterprises
Company is well known for its brand name
'Cafe Coffee Day' (CCD). Company owns a
network of 1,472 Cafe outlets spread across
209 cities in India. As of Dec 2014, Cafe
Coffee Day has market share of 46% in
India in terms of the number of chained Cafe
outlets.
Rs.11.7
Crore
1. Setting-up of new Cafe Network outlets and
Coffee Day Xpress kiosks;
2. Manufacturing and assembling of vending
machines;
3. Setting-up of a new coffee roasting plant facility,
along with integrated coffee packing facility and tea
packing facility.
4. Repayment or prepayment of loans of the
Company and Subsidiaries; and
NA Rs. 253.3
Rs. 316
MICRO ENVIRONMENT Functional areas of Business
Procuring
adequate funds
Mobilization of
funds
Acceleration of
profits
Financial
reporting
Accounting and
Analysis
Maximize firm
value

Competitors’ intelligence
• Competitors’ intelligence in international business is an assessment of the
strengths and weaknesses of current and potential competitors.
• It involves primarily two activities:
1. obtaining information about important competitors and
2. using that information to predict competitor behavior.
Competitors
Analysis
Identifying
competitors
Profiling
Competitors
Comparison of
your potentials
with competitors
Developing
Marketing
Strategy
Most firms face four basic types of Competition:
1. Brand competitors, refers to competition with different brands
offering with similar features, prices and benefits to the same
potential customers.
2. Product competitors, offer same product class but with offer
different benefits, features, and prices.
3. Generic competitors, are rival firms offering products which are
different but are capable of satisfying the same basic want or provide
the same benefit or utility to the prospective customer.
4. Total budget competitors, primarily focus on prices, they compete
for the limited financial resources of the same customers.
MICRO ENVIRONMENT

Various types of competition
Product Need
Brand
Competitors
Product
Competitors
Generic
Competitors
Total Budget
Competitors
Colleges Education
St. Joseph’s, Christ, Jain,
Jyoti Nivas, Mount’s,
Kristu Jayanti
Distance Education,
Community college.
Books, Internet,
Apprenticeship,
Seminars.
Public Colleges
Movies Entertainment
Avengers, Spiderman,
Ice age, Shrek, Batman,
Immortals, Mission
Impossible.
Cable TV, Pay-per-
view on DTH, DVD
rentals
Sporting events like
IPL, Music Concerts,
Exhibitions, Melas.
Relative and friends
house, reading, Parks,
Museum.
Soft Drinks Refreshment
Coca-Cola, Pepsi,
Tropicana, Frooti
Minute Maid, Appy
Tea, Coffee, Badam
Milk, Fruit Juice, Lime
soda, Butter milk.
Tap water,
Prasadam (given in
religious places)
Candy, Pani puri, Pop
corn, Vada pav,
Pakoda.
Sedans
(Large Cars)
Transportation
Maruti Suzuki, Ford
Hyundai, Toyota
Honda, Nissan
Jeeps, Hatchbacks,
SUVs, Minivans, MUVs
Rental cars,
Bikes, BMTC, Metro.
car-sharing, ride-
sharing, lift-sharing
Competitors’ intelligence
MICRO ENVIRONMENT

Suppliers & Intermediaries
MICRO ENVIRONMENT
Physical distribution in business implies to set of activities dealing with Handling,
movement, and storage of goods from the point of origin to the point of consumption.
Raw Material
Supplier
Manufacturer
Wholesaler
Logistics
RetailerCustomer

MICRO ENVIRONMENT
Chapter 2: International Strategic ManagementMohammed Umair: PG Dept. of Commerce
Fibre & Optics
Plastic
Aluminium
Copper
Silicon
Asus motherboard
AMD Processor
Microsoft Software
WD Hard Drives
LG DVD-CD-ROM
DELL
Dell Outlet
Staples
Chroma
Girias
Reliance Digital
Zoya
Aishwarya
Harsha
Rani
Rahul
Raw Materials Components Suppliers
Producer
Reseller Consumer
Supplier Network Distribution Channel
The
Supply
Chain
Supply chain activities from the acquisition of raw materials to the delivery of
finished products to the end user.
Need, Role and Importance of Distribution Channel
BUYING AND ASSEMBLING
WAREHOUSING AND STORING
GRADING AND PACKING
ASSUMPTION OF RISK
SUPPLY OF MARKET INFORMATION
SELLING
ADVERTISING
FINANCINGFACILITATE DEMAND
SUPPLIERS & INTERMEDIARIES

MICRO ENVIRONMENT
Customer  Customers are the most important stake holder of any business. They
are the resource upon which the success of the business depends.
 Focusing on customers & their experiences is the crux of marketing
function.
Model For Customer AnalysisWHO Are Our Current and Potential Customers?
1. What are the demographic, geographic, and psychographic characteristics of our customers?
2. Who actually purchases our products?
3. How do these purchasers differ from the users of our products?
4. Who are the major influencers of the purchase decision?
5. Who is financially responsible for making the purchase?
WHERE Do Customers Purchase Our Products?
1. From what types of vendors are our products purchased?
2. Does e-commerce have an effect on the purchase of our products?
3. Are our customers increasing their purchasing from non-store outlets?

MICRO ENVIRONMENT Customer
Model For Customer Analysis
What Do Customers Do with Our Products?
1. In what quantities and in what combinations are our products purchased?
2. How do heavy users of our products differ from light users?
3. Do purchasers use complementary products during the consumption of our products? If so, what is the
nature of the demand for these products, and how does it affect the demand for our products?
4. What do our customers do with our products after consumption?
5. Are our customers recycling our products or packaging?
When Do Customers Purchase Our Products?
1. Are the purchase and consumption of our products seasonal?
2. To what extent do promotional events affect the purchase and consumption of our products?
3. Do the purchase and consumption of our products vary based on changes in physical/social
surroundings, time perceptions, or the purchase task?

MACRO ENVIRONMENT
Micro-environment refers to all major external factors and forces over which the
marketing firm has no control.
The political environment simply refers to the way a country is being run in terms of politics.
The political environment includes all laws, government agencies and lobbying groups that
influence or restrict individuals or organisations.
 The purpose of analyzing macro-environment is to identify the critical issues in the
external environment that may affect the organization.
POLITICAL ENVIRONMENT
Components of
Political Environment
Political System
Political Risk
Political Ideologies
Indicators of
Political Instability

MACRO ENVIRONMENT
POLITICAL SYSTEM
 A system involving government and its politics which includes the members who are in
power within a country.
Autocracy
An autocracy is a form of government in which a country is ruled by a person or group with
power concentrated in the hands of one person, whose decisions are subject to neither
external legal restraints nor regularized mechanisms of popular control.
 Theocratic
 Secular
Democracy
Democracy is a political system based on representative government, citizen participation
in the political process, freedom and transparency of political acts and process in general.
A democratic society is taken to mean one in which the citizens of the state chose their
leaders.
 Single party
 Multi party
 Multi party with single party dominance

MACRO ENVIRONMENT
POLITICAL ideology
 Ideologies are the sets of basic beliefs about the political, economic, social and cultural
affairs held by the majority of people within as society.
Political ideology refers to a body of ideas that reflects the beliefs and interests of a nation,
political system, etc. and underlies political action. Many political parties base their political
action and election program on an ideology.
 Right wing beliefs value tradition, they are about equity, survival of the fittest, and they
believe in economic freedom.
 In politics, the concept of left-wing, refers to a segment of the political spectrum that
considers a high priority the achieving of social equality through collective rights (social), as
opposed to purely individual interests (private) and a traditional view of society, represented
on the right policy.
 The center-left holds a moderate position on economics.
 The center-right holds a moderate position on economics, though leaning towards the right,
adherents to this idea include pale conservatives some Hindu and religious conservatives.

MACRO ENVIRONMENT
Chapter 2: International Strategic ManagementMohammed Umair: PG Dept. of Commerce
POLITICAL ideology
 Ideologies are the sets of basic beliefs about the political, economic, social and cultural
affairs held by the majority of people within as society.
Political Party Ideologies Internal factions Political position
Congress
Populism, Liberal nationalism, Social
democracy, Democratic socialism, Gandhian
socialism, Progressivism.
Social liberalism,
Secularism, Centrism,
Social conservatism.
Centre-left
Bharatiya Janata
Party
Indian Nationalism, Hindutva, Integral
humanism
Social conservatism
Economic liberalism,
Gandhian Socialism,
Conservatism
Right wing
Communist Party
of India
Populism, Democratic socialism, Secularism
Socialist world, freely
associated individuals
Communism
Samajwadi Party Populism, Democratic socialism, Secularism Secularism Centre-left
Janata Dal United Integral humanism, Secularism, Socialism
Semi-Social liberalism
Secularism
Centre-left
Ideologies of Political Parties in India

MACRO ENVIRONMENT
POLITICAL RISKS
 Probability of loss due to political instability in the buyer's country that may result in
cancellation of a license or otherwise affect the buyer's ability to make payments.
1. Nationalization is process in which host country government takes
control of a foreign company ownership, which can occur for a variety of
reasons.
2. Expropriation: Expropriation is process in which host country
government seizes a foreign company’s assets with compensation.
3. Confiscation: Confiscation is the most severe political risk, in which host
country government takes over of a company’s assets without payment.
4. Domestication: Domestication occurs when the government mandates
local industries, ownership and greater national involvement in a foreign
company’s management.

Indicators of political instability
• Rampant corruption
• Corruption seriously affects India's business and political environment, posing
a challenge to the country's economic growth.
• An increasing number of corruption scandals since the late 2000s have
damaged the government's credibility, caused major loss in tax revenues,
led to social unrest and widened income inequality.
Corruption scandals that shamed India
Scam Title Estimated Loss Description
2G Spectrum Scam Rs. 176,000 crore
One of the largest financial scams in the country, the 2G scam involves undercharging
by government officials to various telecom companies during the allocation of 2G
licenses for cell phone subscriptions.
Commonwealth
Games Scam
Rs. 90 crore
Organizing Committee of the Commonwealth Games was the main accused. It consisted
of a number of corrupt deals involving overstated contracts.
Chopper scam Rs. 3600 crore
The scam involves several politicians and defense officers, who have been accused of
having accepted bribes from AugustaWestland to clear a contract to supply 12
AgustaWestland AW101 helicopters to India.
Coal block
allocation scam
Rs. 1.86 lakh crore
The scandal involves allocation of the country's coal deposits to public and private
sector companies by Prime Minister Manmohan Singh.
Tatra truck scam Rs. 750 crore
Top officials of Bharat Earth Movers Ltd (BEML), a defense public sector undertaking,
and the defence ministry siphoned off Rs750 crore in bribes and commissions over the
past 14 years in the purchase of components for Tatra trucks.
Antrix Devas deal Rs. 200,000 crore
The scam involves former ISRO chairman G Madhavan Nair and three other scientists
who were responsible for a controversial contract between Antrix Corporation and
Devas Multimedia Private Limited.
MACRO ENVIRONMENT POLITICAL ENVIRONMENT

• Complexity of the bureaucracy
• In simple words bureaucracy means excessively complicated administrative procedure. India’s
bureaucracy can place limitations on international investment opportunities.
• One of the main issues facing businesses wishing to operate in India, is the complexity of the
bureaucracy the so-called “license raj” which can add significantly to the cost of doing business.
Indian bureaucracy most inefficient in Asia: Survey
Country Points
Points out of 10; the higher the score, the worst the country's
rating.
Bureaucratic hurdles and government processes resulting in a
difficult operating environment.
Singapore 2.25
Honk Kong 3.53
Thailand 5.25
Taiwan 5.57
Japan 5.77
South Korea 5.87
Malaysia 5.89
China 7.11
Philippines 7.57
Indonesia 8.31
Vietnam 8.54
India 9.21

• Corruption
• Bureaucracy
• Attitude of nationals
• Political unrest
• Voice and Accountability
• Absence of Violence
• Government Effectiveness
• Regulatory Quality
• Rule of Law
• Control of Corruption
• Civil wars
Political Instability Index
MOST POLITICALLY STABLE LEAST POLITICALLY STABLE
1. Norway, 2. Denmark, 3. Canada, 4. Sweden, 5.
Finland
1. Zimbabwe, 2. Chad, 3. Congo, 4.
Cambodia, 5. Sudan
PEACE AND CONFLICT INSTABILITY INDEX
Most Peaceful (Top five) Most Conflicted (Top five)
Slovenia, Sweden, Finland, Ireland and Netherlands
Afghanistan, Congo, Burundi, Guinea and
Djibouti
COUNTRY INDICATORS FOR FOREIGN POLICY: FAILED AND FRAGILE
Least Fragile Most Fragile
Denmark, Sweden, Finland, Japan & Switzerland
Somalia, Afghanistan, Chad, Congo and
Yemen

Basic Country Knowledge
• Is the country a democracy or dictatorship?
• Does country rely on free market or government controls?
• Does government view foreign firms as positive influence?
• Are firm’s customers private or public?
• Does government act arbitrarily?
• Is existing government stable?

MACRO ENVIRONMENT SOCIO-CULTURAL ENVIRONMENT
 A set of beliefs, customs, practices and behaviour that exists within a population.
 International companies often include an examination of the socio-cultural environment prior to
entering their target markets.
Attitude of
people
Demographic
Factor Religion Social
Responsibility
Taste &
Preference Education Family Natural Factor
Income & Life
Style
Health & Safety
Factor Language Dressing
FACTORS WHICH EFFECT SOCIAL AND CULTURAL ENVIRONMENT

MACRO ENVIRONMENT ECONOMIC ENVIRONMENT
 Economic environment refers to the sum of all economic factors, policies and
nature of an economy which acts as a major determinant of the economic
environment within which the business enterprise work.
1. Economic system means structured regulations, objectives that governs economic
relation with people in a society and the way the in which the production, distribution,
consumption and allocation resources in a nation takes place.
a. In a capitalist economy factors of production are privately owned
and governed.
b. Under Socialist economy all the economic activities of the country
are controlled and regulated by the Government in the interest of
the public.
c. A Mixed economy is a combination of capitalist and socialist
economy. Both private and public sectors play key roles in the
development of the country.
Economic
Environment
Economic System
Capitalism
Socialism
Mixed Economy
Major Rates
Inflation
Interest
Forex rates
Business cycles
Recession
Boom
Recovery
Economic growth
rate
GDP
Per capita income
Economic Policies
Fiscal
Monetary
Foreign policy

 Economic environment refers to the sum of all economic factors, policies and nature
of an economy which acts as a major determinant of the economic environment
within which the business enterprise work.
2. Inflation rates and Interest rates
 Higher interest rates increases the costs.
 High rate of inflation rates results in reduced purchasing power for consumers which leads to lower
demand
3. Business cycles
 Economy experiences over a long period of time and includes economic conditions such as prosperity,
recession, depression and recovery.
4.Economic Policies
 Economic policy refers set of activities and response of government to influence its economy.
5. Savings, debt, and credit availability
 Spending and expenditures of customers are influenced by savings, debt they owe and availability of
credit. On account of employment opportunities income levels have increased in urban India, further
consumption in rural India has also grown faster
6. Economic growth rate
 Economic growth refers to increased capacity of production of goods and services compared from one
period of time to another.

Country Top Rate Region
United Arab Emirates 55.0% Asia
Chad 40.0% Africa
United States 39.1% North America
Cameroon 38.5% Africa
Japan 37.0% Asia
Virgin Islands, U.S. 35.0% North America
Angola 35.0% Africa
Zambia 35.0% Africa
Equatorial Guinea 35.0% Africa
Malta 35.0% Europe
Argentina 35.0% South America
Congo 35.0% Africa
Yemen 35.0% Asia
Saint Kitts and Nevis 35.0% North America
Guyana 35.0% South America
France 34.4% Europe
Brazil 34.0% South America
Venezuela 34.0% South America
Pakistan 34.0% Asia
India (now 25%) 34.0% Asia
Corporate Tax Rates around the WorldWhich country has the highest tax rate?
Personal Income Tax
• 10 Ireland: 48%
• 9 Finland: 49.2%
• 8 United Kingdom: 50%
• 7 Japan: 50%
• 6 Austria: 50%
• 5 Belgium: 50%
• 4 Netherlands: 52%
• 3 Denmark: 55.38%
• 2 Sweden: 56.6%
• 1 Aruba: 58.95

MACRO ENVIRONMENT
World's Top Saving Countries
ECONOMIC ENVIRONMENT
• No. 1: Qatar-59%Estimated GDP
• No. 2: Kuwait - 55%Estimated GDP
• No. 3: China - 51%Estimated GDP
• No. 4: Saudi Arabia - 48%Estimated
• No. 5: Equatorial Guinea - 46%
• No. 6: Algeria - 45%Estimated
• No. 7: Singapore - 45%Estimated
• No. 8: Gabon - 42%Estimated
• No. 9: United Arab Emirates - 40%Estimated
• No. 10: Bahrain - 39%Estimated
• No. 11: Islamic Republic of Iran
• No. 23: India

MACRO ENVIRONMENT
Legal environment is closely linked with the political environment.
LEGAL ENVIRONMENT
Common Law
 Based on wisdom of judges decisions on individual cases through history
 Cases create legal precedents
Civil Law
 Based on codification of what is and is not permissible
 Judge determines scope of evidence collected and presented.
Religious Law
 Based on the officially established rules governing faith and practice of a
particular religion
 Theocracy: country that applies religious law to civil and criminal conduct
Kinds of Legal
System
Common Law
– based on
past decisions.
Code Law –
based on the
written laws.
Theocratic
Law – based
on religion.

MACRO ENVIRONMENT
MNCs & Legal environment
LEGAL ENVIRONMENT
1. International laws, treaties etc..
 Incoterms – laid by International Chamber of Commerce.
 Settlement of disputes
– Judicial dispute Settlement.
– Extra-Judicial dispute Settlement.
2. Laws of foreign countries.
 Regulation related to Products
 Product Standard
 Disclosure.
 Environment laws
 Product liability
 Packing and labeling
 Regulation of price.
 Regulation of promotion
 Regulation of trade practices
3. Laws of home country.
Protection of IPRS
Bribery and corruption
Advertising and sales promotion
Contracts
Shipping of goods
Labour laws
Environment laws

MACRO ENVIRONMENT LEGAL ENVIRONMENT
Countries Using Common Law
• United States
• Canada
• Australia
• India
• New Zealand
• Malaysia
Civil law
• Brazil
• France
• Egypt
• Germany
• Japan
• Mexico
• Spain
• Turkey
Religious and sharia law
• Afghanistan
• Yemen
• Saudi Arabia
• Iran

MACRO ENVIRONMENT
Top Ten Reasons for Studying the Legal Environment of Business
LEGAL ENVIRONMENT
1. Becoming aware of the rules of doing business.
2. Familiarizing yourself with the legal limits on business freedom.
3. Forming an alertness to potential misconduct of competitors.
4. Appreciating the limits of entrepreneurship.
5. Being able to communicate with your lawyer.
6. Making you a more fully informed citizen.
7. Developing an employment-related skill.
8. Exploring the fascinating complexity of business decisions.
9. Providing a heightened awareness of business ethics.
10. Opening your eyes to the excitement of the law and business.

MACRO ENVIRONMENT
SUMMARY
Political & Legal
Environment
• Political System
• Political Risk
• Political Ideologies
• Indicators of Political
Instability
• Monopoly controls
• Legislations
Economic Environment
• Economic System
• Inflation rates
• Business cycles
• Economic growth rate
• Economic Policies
• Savings, debt, and credit
availability
Socio-Cultural
Environment
• Changes in lifestyles
• Family structures
• Attitudes and values
• Household Patterns
• Social Mobility
Natural Environment
• Geographical Location
• Availability of resource
• Access to natural
resources
• Concern for environment
• Increased energy cost
Technological
Environment
• Degree of Automation
• Emerging Technologies
• R&D Activity
• Technology Transfer

ROLE & SIGNIFICANCE OF MARKETING
Organization’s reputation plays a significant role in improving the overall environment in which companies do business, including:
1. MARKETING SCRIPTS ORGANIZATION’S REPUTATION
• Maggi exceeded lead content, violated labelling rules and Nestlé lost at least $277 million + $70 million.
• TRAI recommended a penalty of Rs. 3,050 crore on top three telcos – Airtel, Vodafone and Idea, for violating their license agreement
and denial of interconnection to new player Reliance Jio.
• SpiceJet faces the music for dances on Holi
REGULATORY RISK
• INDIA'S BEST COMPANIES TO WORK FOR 2016
• Google India I American Express India I Ujjivan Financial Services I Teleperformance India I Godrej Consumer Products I Marriott
Hotels SAP Labs India I The Oberoi Group I Intuit India Lemon Tree Hotels.
ATTRACTING & RETAINING HIGH-QUALITY EMPLOYEES
• TOP TEN FORTUNE INDIA’S MOST ADMIRED COMPANIES
• ITC I L&T I Hindustan Unilever I Maruti Suzuki I State Bank of India I TCSCoca Cola India I Samsung India I Tata Motors
BUILDING STRONGER BRANDS
• Communicate like a human-being
• Learn about your customer
• Live for customer complaints
• Stay in regular contact with customers
• Build trust with customers
RELATIONSHIPS WITH CONSUMERS
• Offloading: Pay Rs 10 lakh to flyer with cerebral palsy, SC to SpiceJet.
• HSBC to pay record $1.9 bln U.S. fine in money laundering case
REDUCING LITIGATION

With the help of marketing tools like advertisement, sales promotion marketers can increase customer awareness of its
products which result in demand creation, leading to increased sales revenue.
2. MARKETING GENERATES REVENUE
Amazon's 'Apni Dukaan‘ & 'Aur Dikhao'
campaign captures the dilemma of
online shoppers
Star Sports has came out with
'Mauka Mauka' ad campaign
assisted the channel to get into
limelight.
 Marketing helps increase brand awareness and word of mouth of what a company offer.
 Marketing can be the biggest profit-making tool marketers find in business.
MARKETING IS THE MACHINE THAT DRIVES BUSINESS.

The external business environment includes technology, competition, socio-economic factors and
a business has to function under the influence of these factors for which marketing has to be
dynamic & proactive and not reactive.
3. MARKETING MAKES ORGANIZATION DYNAMIC
CHANGE IN TASTE & PREFERENCES
Scooterisation is back.
From 1948 when Bajaj Auto became the
first Indian scooter dealer till the mid-
1980s, scooters had enjoyed a dominance.
Automobile Products of India (API) that
had introduced the Lambretta scooter
in 1949
LML which entered into a tie-up
with Piaggio in 1983.
Kinetic Honda was a joint venture
between Kinetic Engineering Limited,
India and Honda Motor Company, Japan.
The JV operated during 1984 – 1998.
India's first gearless scooter.
Production: 1990-2000
Bajaj Sunny
Founded: 1994
TVS Scooty
The first scooter manufactured by
Hero Honda since 2005.
Pleasure

3. MARKETING MAKES ORGANIZATION DYNAMIC
Key Players in Scooters-2017
Honda and Hero parted ways and the Japanese
major arrived in 2000 with the Activa.
2017: Activa overtakes bikes,
revives scooter raj in India
Automatic scooters to overtake motorcycles in two-wheeler
segment as Honda drives growth.
Working women| Mileage | Better rural roads | Traffic
Conditions | Senior Citizens

Competitive advantage refers to superiority that a firm has over its competitors,
allowing it to generate greater market share than its competitors. This can be achieved
through by offering a better-quality product or service, lowering prices and increasing
marketing efforts.
4. CREATES COMPETITIVE ADVANTAGE
COMPANY INDUSTRY TYPE COMPETITIVE ADVANTAGE
IKEA Furniture industry
Superior product at an affordable rate backed by a strong
customer support system.
Facebook
Social networking
service
Superior database management and data processing
capabilities
Addidas
Apparel,
accessories
Uses brand name as leverage to break into new markets in
completely new territories.
McDonald's Restaurants
Providing convenience when people need and want to eat
fast food at prices that are competitive and provide best
value for the customer's money.
Flipkart E-commerce
Strategic investments and acquisitions & supply chain costs,
primarily warehouse management and logistics.
COMPANIES AND THEIR COMPETITIVE ADVANTAGE

It’s difficult to assign a monetary value to a brand, but no matter how intangible brand equity
may seem, a strong brand reaps considerable business benefits from:
1. Awareness
2. Credibility
3. Reputation
4. Customer satisfaction
Those benefits serve as tools to marketers in the effort to attract that mindful consumer who
wants to buy from a brand high in value.
5. BUSINESS VALUE ACCELERATION
Business value is a wider term that not only includes economic values such as profit motive,
shareholder wealth and interest but also combines values such as employee value, customer
value, supplier value, channel partner value, alliance partner value, managerial value, and
societal value.

Introduction to Marketing

Empfohlen

Empfohlen

Weitere ähnliche Inhalte

Was ist angesagt?

Was ist angesagt? (20)

Ähnlich wie Introduction to Marketing

Ähnlich wie Introduction to Marketing (20)

Mehr von Mohammed Umair

Mehr von Mohammed Umair (20)

Kürzlich hochgeladen

Kürzlich hochgeladen (20)

Introduction to Marketing