Sessions I Objectives

What concepts underlie the discipline of marketing What basic tasks do marketing managers perform What is marketing concept and how does it contrast with other philosophies of doing business

Core Concepts of Marketing

Needs,Wants and Demands Product or Offering Value and Satisfaction Exchange and Transactions Relationships and Networks Marketing Channels Supply Chain Target Markets

Marketing Management
Process of analyzing,planning,implementing,coordinating and controlling programs involving the conception,pricing,promotion and distribution of goods, services and ideas designed to create and maintain beneficial exchanges with the target markets for the purpose of achieving organisational objectives

Modern Marketing System

Suppliers
Company (Marketer)

Competitors Environment

Environment

Marketing Intermediaries
End User Market

Marketing Management
Marketing Management
Implementing programs to create exchanges with target buyers to achieve organizational goals

Demand Management
Finding and increasing demand, also changing or reducing demand such as in Demarketing

Profitable Customer Relationships

Attracting new customers and retaining and building relationships with current customers

Essential requirements of marketing

The identification of consumer needs(What goods & services are bought, how they are bought,by whom they are bought and why they are bought) The definition of target market(grouping of customers by common characteristics, geographic, demographic, psychological etc) The creation of differential advantage by which a distinct competitive position relative to other companies can be established

How the differential advantage can be established?

Manipulation of the elements in the marketing mix

The Ps of marketing

Product-Product Management, NPD, Branding, Packaging Pricing-Discounts, Allowances,Terms of Business etc Promotion-Advtg, SalesPromotion, Publicity, PR,personal selling Place-Channel Management,Physical Distribution People-Employee selection, training, motivation Physical evidence-layout , dcor, ease of access,forms of presentation Process Management-How the customers are handled and managed from the point of very first contact with the organisation

Company orientation towards marketplace

The Production Concept The Product Concept The Selling Concept The Marketing Concept The Societal Marketing Concept

Marketing and Sales Concepts Contrasted

Starting Point
Factory

Focus
Existing Products

Means
Selling and Promoting

Ends
Profits through Volume

The Selling Concept

Profits through Satisfaction

Market

Customer Needs

Integrated Marketing

The Marketing Concept

Societal Marketing Concept

(Human Welfare)

Society

Societal Marketing Concept

(Want Satisfaction)

Consumers

Company
(Profits)

Holistic Marketing Concept

Relationship Marketing Integrated Marketing Internal Marketing Performance Marketing

Pillars of the Marketing Concept

Target Market Customer Needs Integrated Marketing Profitability

Marketing Tasks

Target those customers most compatible with its resources Develop products that meet the needs of the target market better than the competitive products do Make products readily available Develop customer awareness of the problem solving capabilities of the companys product line Obtain feedback from the market about the companys products

Marketing tasks

Developing marketing strategies and plans Capturing marketing insights Connecting with customers Building strong brands Shaping market offerings Delivering value Communicating value Creating long term growth

The Customer Focus

Factors influencing customer satisfaction

Delivery system Product Performance Image Price Value Relationship Employee Performance Competition

Requirement for developing customer driven organization

Instilling customer oriented values and beliefs supported by top management Integrating market and customer focus into strategic planning process Developing strong marketing managers and programs Creating market based measures of performance Developing customer orientation throughout the organization

Marketing Myopia

Because of myopic product focus others gain the benefits of growth Define the business in terms of basic customer needs rather than product Transportation Business rather than railroad business- energy instead of petroleum business,communication rather than telephone business Xerox changed focus from copiers when it became the document company Defining a business in terms of generic need is useful in fostering creativity and generating strategic options and avoiding internally oriented product/production focus

Dynamism in Business and Marketing

ESCALATING INFULENCE OF TECHNOLOGY

Competitive Advantage High Cost Short Life Cycles Range of Choices Innovation Process Analyzing Customer Needs Information technology Environmental responsibility

Gillete Sensor Case

Gillete sensor razor introduced in 1990 required about $200 mn do develop and start manufacturing another $110 mn in commercialization Business Challenge was formidable
To substantially increase Gilletes profits sensor must perform a marketing miracle:halt a 15 year old trend towards inexpensive disposable razors at double the cost of shaving using disposablessensor will be a hard sell

Challenges
Customers Expect higher quality and service and customization Perceive fewer real product differences Show greater price sensitivity Can obtain extensive product information

Brand Manufacturers Intense competition from local and foreign brands Rising promotional costs and shrinking profits Bargaining power of retailers who command limited shelf space

Store based retailers Small retailers versus the giant retailers Store retailing versus non store retailing Large retailers selling experience rather than only product assortment

Shifts

Marketing does marketing-Everyone does marketing Making everything-outsourcing Many Suppliers- Few suppliers- Partnerships Relying on old market positions- uncovering new ones Emphasising on tangible assets- emphasis on intangible assets Advertising- IMC Store retailing-non store retailing Selling to everyone- Selling to well defined target market Market Share- Customer Share Local- Glocal Focusing on financial scorecard- Marketing Score card Shareholder focus Stakeholder focus

Company responses and adjustments to challenges

Reengineering Outsourcing-virtual companies E-commerce Benchmarking-study world class performers and adopt best practices Alliances Partner suppliers Market Centered Global Decentralised

Marketer responses and adjustments to challenges

Relationship Marketing Customer lifetime value Customer Share instead of market share-Variety to existing customers Target Marketing Individualization Customer Database Integrated Marketing Communication Channels as partners Every employee a marketer Model based decision making