Introduction to Marketing

Dr Javed Iqbal

Contemporary issues in
Marketing
How to identify
customer?
How can we identify and choose profitable
market segments?
How can differentiate our offer from our
competition?
How should we react to competitors?
How can we satisfy our customers and
build brand loyalty?
How can we measure the effectiveness of
an add campaign, of Public Relations, of a
promotion, etc?

Evolution of Marketing
1. Production: consumers will favor products
that are available and highly affordable

2. Product: consumers favor products that offer

the most in quality, performance, and innovative
features

3. Selling: consumers will not buy unless an

organization undertakes a large-scale selling and
promotional effort

4. Marketing: determining the needs and wants

of target markets and delivering the desired
satisfactions more effectively and efficiently
then the competitors

5. Societal marketing: generating customer

satisfaction and long-run societal well-being are
the keys to both achieving the companys goals
and fulfilling its responsibilities

What Is Marketing?
Simple definition:
Marketing is the management process
responsible for identifying, anticipating, and
satisfying customer requirements profitably.
(CIM,2001)

Goals:
1. Attract new customers by promising superior
value.
2. Keep and grow current customers by delivering
satisfaction.

Marketing Defined
Marketing is the activity, set of
instructions, and processes for creating,
communicating, delivering, and
exchanging offerings that have value for
customers, clients, partners, and society
at large.

OLD view of
marketing:

NEW view of
marketing:

Making a sale
telling and
selling

Satisfying
customer needs

Why is Marketing
Important?
Shifting Business Paradigms

Buyers markets
Sellers markets

The Marketing Process

A simple model of the marketing process:
Understand the marketplace and customer
needs and wants.
Design a customer-driven marketing
strategy.
Construct an integrated marketing
program that delivers superior value.
Build profitable relationships and create
customer delight.
Capture value from customers to create
profits and customer quality.

Needs, Wants, and Demands

Need: State of felt deprivation including physical,
social, and individual needs.
Physical needs: Food, clothing, shelter, safety
Social needs: Belonging, affection
Individual needs: Learning, knowledge, selfexpression

Want: Form that a human need takes, as

shaped by culture and individual
personality.

Wants + Buying Power = Demand

Need/ Want Fulfillment

Needs & wants are fulfilled through a
Marketing Offering:
Products:
Persons, places, organizations, information,
ideas.

Services:
Activity or benefit offered for sale that is
essentially intangible and does not result in
ownership.

Experiences:
Consumers live the offering.

Customer Value and Satisfaction

Dependent on the products perceived
performance relative to a buyers
expectations.
Care must be taken when setting
expectations:
If performance is lower than expectations,
satisfaction is low.
If performance is higher than expectations,
satisfaction is high.
Customer satisfaction often leads to consumer
loyalty.
Some firms seek to DELIGHT customers by

Marketing Management
The art and science of choosing target
markets and building profitable
relationships with them.
Requires that consumers and the
marketplace be fully understood.
Aim is to find, attract, keep, and grow
customers by creating, delivering, and
communicating superior value.

Marketing Management
Marketing managers must consider the
following, to ensure a successful
marketing strategy:
1. What customers will we serve?
What is our target market?

2. How can we best serve these

customers?
What is our value proposition?

Choosing a Value
Proposition
The set of benefits or values a company
promises to deliver to consumers to satisfy
their needs.
Value propositions dictate how firms will
differentiate and position their brands in
the marketplace.

The Marketing Concept

The marketing concept:
A marketing management philosophy that
holds that achieving organizational goals
depends on knowing the needs and wants
of target markets and delivering the
desired satisfaction better than
competitors.

Customer Perceived Value

Customer perceived value:
Customers evaluation of the difference
between all of the benefits and all of the
costs of a marketing offer relative to
those of competing offers. (Armstrong
& Kotler)
Perceptions may be subjective
Consumers often do not objectively
judge values and costs.
Customer value = perceived benefits perceived
sacrifice.

The Marketing Mix

The set of controllable, tactical marketing tools that
the firm blends to produce the response it wants
in the target market.
Product: Variety, features, brand name, quality,
design, packaging, and services.
Price: List price, discounts, allowances, payment
period, and credit terms.
Place: Distribution channels, coverage, logistics,
locations, transportation, assortments, and
inventory.
Promotion: Advertising, sales promotion, public
relations, and personal selling.

Marketing strategy

Customer-Driven Marketing Strategy

Requires careful customer analysis.
To be successful, firms must engage in:
Market segmentation
Market targeting
Differentiation
Positioning

Market Segmentation and Targeting

Segmentation:
The process of dividing a market into
distinct groups of buyers with different
needs, characteristics, or behavior who
might require separate products of
marketing programs.
Targeting:
Involves evaluating each market
segments attractiveness and selecting
one or more segments to enter.

Differentiation and Positioning

Differentiation:
Creating superior customer value by
actually differentiating the market offering.
Positioning:
Arranging for a product to occupy a clear,
distinctive, and desirable place relative to
competing products in the minds of target
consumers.

Market Segmentation
Key segmenting variables:
Geographic
Demographic
Psychographic
Behavioral

Different segments desire different benefits from

products.
Best to use multivariable segmentation bases in
order to identify smaller, better-defined target
groups.

Market Segmentation
Why Segment?:
Meet consumer needs more precisely
Increase profits
Segment leadership
Retain customers
Focus marketing
communications

Evaluating Market Segments

Segment size and growth:

Analyze current segment sales, growth rates,

and expected profitability.

Segment structural attractiveness:

Consider competition, existence of substitute

products, and the power of buyers and
suppliers.

Company objectives and resources:

Examine company skills and resources needed

to succeed in that segment.
Offer superior value and gain advantages over
competitors.

Market Targeting
Market targeting involves:
Evaluating marketing segments.
Segment size, segment structural
attractiveness, and company objectives
and resources are considered.

Selecting target market segments.

Alternatives range from undifferentiated
marketing to micromarketing.

Being socially responsible.

Differentiation and
Positioning
A products position is:
The way the product is defined by
consumers on important attributesthe
place the product occupies in consumers
minds relative to competing products.
Perceptual positioning maps can help
define a brands position relative to
competitors.

Differentiation and
Positioning
Identifying possible value differences and
competitive advantages:
Key to winning target customers is to
understand their needs better than
competitors do and to deliver more value.
Competitive advantage:
Extent to which a company can position
itself as providing superior value.
Achieved via differentiation.

Thank you.