LECTURE 01

INTRODUCTION TO
MARKETING

Contents

Concept of Marketing
Nature of Marketing
Integrated Marketing Concept
Marketing Activities
Concept of Market
Micro and Macro Marketing
Evolution of Marketing
Contd.

Contents (Contd.)

Marketing Philosophies
Modern Marketing Concept
Selling vs. Marketing
Marketing Bridges Gap b/w Producer and
Seller
Scope of Marketing
Functions of Marketing
Importance of marketing
Modern Marketing Process

Concept of Marketing
Meaning & Definition
Marketing provides Utility

Concept of Marketing

Identifying and meeting human and social

needs
Meeting needs profitably
AMA: Marketing is an organizational function and
set
of
processes
for
creating,
communicating and delivering value to
customers and for managing customer
relationships in ways that benefit the
organization and its stakeholders.

Concept of Marketing
(Contd.)

Social Definition (Philip Kotler): Marketing is a societal process by which individuals

and groups obtain what they need and want
through creating, offering and fully exchanging
products and services of value with others.
Peter F. Drucker: The aim of marketing is to make selling superfluous
To know and understand the customer so well that
the product or service fits him and sells itself.
Selling is just the tip of the Marketing iceberg

Concept of Marketing
(Contd.)

Marketing
UTILITY

satisfies

needs

by

providing

Form Utility
Person Utility Establishing Contact with the Cr
Exchange Utility
Transferring Gs to Br
(Introducing Money; Banking and Financing)
Place Utility
Physical Distribution & Logistics
(Transporting, Storage, Pkging; Insce)
Time Utility
Providing goods when needed
(Warehousing)
Knowledge
Utility
Providing
Information
(Promotion
Function)

Nature of Marketing

Nature of Marketing
1.

Customer & Competitor Directed

COMPETITOR EMPHASIS

CUSTOMER
EMPHASIS

Major

Minor

Majo
r

Market
Driven

Customer
Oriented

Mino
r

Competitor
Oriented

Self
Centered

Nature of Marketing
(Contd.)
2.

Delivers Value

3.

4.
5.

Customer Value = Total Benefits Total Cost

Perceived monetary value of the bundle of economic,
functional and psychological benefits that consumers
expect from a given market offering
TC Evaluating, Obtaining, Using and Disposing of
the given market offering

Creation
of
mutually
relationships
Aims cr satisfaction
Surrounded by Cr needs

beneficial

Nature of Marketing
(Contd.)
6.

Marketing is Business
Goal

Orientation
Exchange for Money
Profit Focus
7.
8.
9.
10.

Part of total envt.

Discipline
System and Process
Integrated process

Integrated Marketing Concept

Integrated Marketing
Concept

Many different marketing activities

communicate and deliver Value and
When
coordinated,
marketing
activities maximize their joint effort

Marketing Activities

Marketing Activities

Sellers View 4 Ps (McCarthy)

Buyers View SIVA
S -Solution
problem?
I
-Infon.
about it?
V -Value
sacrifice to get it?
A -Access

How can I solve my

-

How can I learn more

What is my total

Where can I find it?

Concept of MARKET
What is Marketed
Who Markets

Concept of Market

What is Marketed?
1.
2.
3.
4.
5.

Goods
Services
Events
Experiences
Persons

Concept of Market (Contd.)

What is Marketed?
6.
7.
8.
9.
10.

Places
Properties
Organizations
Information
Ideas

Concept of Market (Contd.)

Who Markets?
1. Marketers and Prospects

Eight demand states: Negative

demand: consumers dislike the product

and may even pay a price to avoid it.
Nonexistent demand: consumers may be unaware or
uninterested in the product.
Latent demand: consumers may share a strong need
that cannot be satisfied by an existing product.
Declining demand: consumers begin to buy the
product less frequently or not at all.

Concept of Market (Contd.)

Who Markets?
1. Marketers and Prospects

Eight demand states: Irregular

demand: consumer purchases vary on a

seasonal, monthly, weekly, daily, or even hourly basis.
Full demand: consumers are adequately buying all
products put into the marketplace.
Overfull demand: more consumers would like to buy
the product than can be satisfied.
Unwholesome demand: consumers may be attracted to
products that have undesirable social consequences.

Concept of Market (Contd.)

Who Markets?
2. Markets

Traditional Place where Br and Sr gathered to buy and

sell goods

S Constitutes Industry
B Constitutes Market
Types
Consumer Market
Business / Industrial Market
Non-Profit Market
Global / International Market

Concept of Market (Contd.)

3.

Who Markets?
Market Places;
markets

Market

Spaces;

and

Meta-

Market Place :
Physical
Market Space :
Digital Virtual world where S.& B.
meet through internet and www
Meta-Market :
Northwestern Universitys Mohan
Sawhney: Cluster of complementary products & services
that
are closely related in the minds of consumers but
spread across a diverse set of
industries.

Meta-mediaries
makemytrip.com

Marutitruevakue.com;

Micro & Macro marketing

Micro & Macro marketing

Micro Marketing

Process of formulating and implementing such

strategies by a firm (4 P Decisions) that ensures
flow of need satisfying Gs and Ss at profit

Stanton: Marketing is a total system of interacting

business activities designed to plan, price,
promote and distribute want satisfying products
& services to present and potential customers

Micro & Macro marketing

Macro Marketing

Complex system of organizations and

processes by which a nations resources are
distributed amongst people to satisfy their
needs and wants
How effectively society uses its resources
Functions: Information Function
Equalizing and Distribution Function
Centralized Exchange Function

Evolution of Marketing
Evolution
Comparison of:

Production Orientation;
Marketing Orientation; &
Customer Orientation

Evolution of Marketing

Evolution of Marketing
PROD .
MKTG.
CUST
BASIS
(Contd.)
ORIENTATION
ORIENTATION
ORIENTATION
N

FOCUS
STRESS
EMPHASIS
AIM

PHILOSOPHY

Push the product in Analyze custr and Customer

the market
create demand
Satisfaction through
Pdt.
Production Deptt.
Pdn
and
Mktg All Deptts.
Deptts/
Product
Consumer
Consumer
satisfaction
Profit through sale Profit
through Profit
through
of
a
successful assessment
of increased sale as a
product
Consumer Behavior result of customer
and placing the pdt satisfaction
accordingly
To sell what could To sell what is To produce what is
be produced
produced
by wanted and what
creating
demand should
give
artificially
satisfaction to the
consumers.

Marketing Philosophies
(Changing Concepts of Marketing)

Marketing Philosophies
Production Concept

1.

Belief :
cost &
Focus :
efficiency

Cr favors products that are in

widely available
Mass Prodn High Production

Mass Distn Wide Distn

Cr interested in getting quality products at
cost with assured supply.

Marketing Philosophies
(Contd.)
Product Concept

2.

Belief
:
Cr will favor those products that offer most
Qlty, Perfce & Features
Focus
:
Making good Products Improving them
over time
Leads to Marketing Myopia
Professor

Thoedre Levitt
Crooked perception of marketing & a short
sightedness about business
Undue concentration on the product rather than
on the need
Inadequate understanding of the market

Marketing Philosophies
Selling Concept

3.

Belief
:
selling
Focus
:

Organization must make aggressive

promotion effort
Hard Selling

Marketing Philosophies
Marketing Concept

4.

Belief :
Key to achieving organizational goals
consists
in determining the
needs and wants of target
markets
and delivering desired satisfaction
more effectively and efficiently than
competitors
Focus :
C. Satis. through better offerings

Marketing Philosophies
(Contd.)
Societal Marketing Concept

5.

Organizations task is to determine the

needs, wants and interests of target
markets
&
to
deliver
the
desired
satisfaction more effectively and efficiently
than competitors in a way that preserves or
enhances the customers and societys
well-being.

Marketing Philosophies
(Contd.)

CHARACTERISTIC

Production
Orientation

Product
Orientation

Selling
Orientation

Marketing
Orientation

Desire to capitalize
on synergies and
efficiencies
in
production process
Attention
to
designing
and
production
of
a
quality product
Dedicated
resources
to
stimulating interest
and
desire
for
product purchase
Focus on identifying
and
satisfying
needs and wants of
customers
Consideration
of
the short and long
term
effects
of
actions
on
customers and on

Dominant

Present

Present

Present

Societal
Marketing
Orientation
Present

Not Pertinent

Dominant

Present

Present

Present

Not Pertinent

Not Pertinent

Dominant

Present

Present

Not Pertinent

Not Pertinent

Not Pertinent

Dominant

Present

Not Pertinent

Not Pertinent

Not Pertinent

Not Pertinent

Dominant

Modern Marketing
Concept
Nature
Foundation
Importance
Limitation

Modern Marketing Concept

Nature
1.
2.
3.
4.
5.
6.

Customer Orientation
Marketing Research
Marketing Planning
Integrated Marketing
Systems approach
Customer Satisfaction

Modern Marketing Concept

(Contd.)

Foundation
Achieving Goals by meeting
Customer Needs

Customer
Orientation

Integrated
Marketing

Profit to
follow
Customer
Satisfaction

Modern Marketing Concept

(Contd.)

Importance
1.
2.
3.
4.
5.

Product Acceptability
Efficiency in marketing operations
Rational Decision Making and Problem Solving
Sustained growth of the organization
Effective mgmt of environment

Limitation
Ignores social perspective of business

Marketing vs. Selling

Marketing vs. Selling

Selling

Procuring orders from Customers and delivery

of products

Marketing

Design of products acceptance to Cr and

transfer of ownership from the Sr to Br

Marketing vs. Selling

(Contd.)
BASIS
Focus
Emphasis

SELLING
Sellers Needs
Pdt. Orientation

MARKETING
Buyers needs
Customer needs and
wants

Aim

Sales Volume =
Fragmented

CS =
Integrated

Approach
Process

Convert pdts. to cash Convert Cs needs to

pdts

Belief

Caveat Emptor

Strategy

High pressure selling Pdt planning &

to sell goods already development to
produced
match pdts with

Caveat vendor

Marketing vs. Selling

(Contd.)
BASIS

SELLING

MARKETING

Pricing

Cost determines
price

Consumer
determines price

Planning

Short-run

Long-run

Business
View

Goods producing
process

Consumer satisfying
process

Ideology

Existing technology Innovation;

and decreasing
providing better
costs
value to customers

Customer Last link in business Very purpose of

View
business

Marketing Bridges Gap b/w Producer

and Seller

Marketing Bridges gap b/w Pr &

Cr
1.
2.
3.
4.
5.
6.
7.

Spatial Separation
Temporal Separation
Separation of Information
Separation of Values
Separation of Ownership
Discrepancies of Quantity
Discrepancies of Assortment

Scope of Marketing

Scope of Marketing

Product Policy and Planning

Marketing research
Motivation research
Test marketing
Distribution
Channels
Transportation
Warehousing
Sales planning
Sales Targets
Expense Limits

Scope of Marketing (Contd.)

Sales Management
Recruitment
T & D
Sales Targets
Incentives
Performance Appraisal
Miscellaneous
4 Ps
Packaging

Functions of Marketing

Functions of Marketing
1.

2.

3.

Functions of Research
1. Marketing Research
2. Product Planning and Development
Functions of Exchange
1. Buying
2. Assembling
3. Selling
Functions of Physical Treatment
1. Stdzn, Grading & Branding
2. Packaging

Functions of Marketing
(Contd.)
3.

4.

Functions of Physical Treatment (Contd.)

3. Storage / Inventory mgmt / Warehousing /
Material Handling
4. Transportation
Functions of Facilitating Exchange
1. Salesmanship
2. Advertising
3. Pricing
4. Financing
5. Insurance

Importance of Marketing

Importance of Marketing

Marketing affects our lives

Marketing satisfies our needs
Generates revenues for the
business firms
Marketing and Economy

Modern Marketing Process

Modern Marketing Process

Market Anticipation

Customer Demand through Market Research

Producers

Goods
Flow

Marketing
Mix

Exchange something of Value

Goods
Flow

Customers