RECAP OF MKTG I AND

MARKETING MIX

SMITU MALHOTRA

1
RECAP
“Marketing is everything”-
comment.
Do you think marketing changes
the way companies think?

2
RECAP
 Core Concepts – What are Need ,
Wants , Demand - Products and
services – marketing offer.
 Discussion: what’s the difference
between these?
 Discussion: why is it important to
understand the difference?

3
Types of Needs
 Physical:
 Food, clothing, shelter, safety
 Social:
 Belonging, affection
 Individual:
 Learning, knowledge, self-expression

4
This Is a Want

Wants - form
that a human
need takes, as
shaped by
culture and
individual
personality.
5
 This Is Demand

Wants Buying Power

“Demand”
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 What Satisfies Consumers’
Needs and Wants?

Products
Products
Anything
Anything that
that can
can be
be Offered
Offered to
to aa Market
Market to
to Satisfy
Satisfy aa Need
Need or
or Want
Want

Persons
Persons Places
Places Organizations
Organizations

Information
Information Ideas
Ideas

Services
Services
Activity
Activity or
or Benefit
Benefit Offered
Offered for
for Sale
Sale That
That isis Essentially
Essentially
Intangible
Intangible and
and Does
Does Not
Not Result
Result in
in the
the Ownership
Ownership of of Anything
Anything
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RECAP
 Concept of Marketing Myopia

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 Marketing Myopia

 Sellers pay more

attention to the
specific products they
offer than to the
benefits and
experiences produced
by the products.
 They focus on the
“wants” and lose sight
of the “needs.”

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Marketing Myopia
 Railroads.
 Cinema.
 Mosquito creams.
 Tape spools.
 The travel agent.
 The courier service.

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RECAP
 Concept of value and satisfaction

11
 Value and Satisfaction

Expectation Performance Expectation Performance

8 10 10 8

If performance is lower than expectations, satisfaction is low.

If performance is higher than expectations, satisfaction is high.

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RECAP
 Contrast the concept of sales and
marketing.

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Marketing and Sales Concepts
Contrasted

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RECAP
 What is environmental analysis –
and its implication for
marketing?

15
 Actors in the
Microenvironment

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Major Macroenvironmental
Forces

17
Environmental analysis
 SWOT

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RECAP
 What is consumer behavior?
What are the buying roles and its
marketing implication?

19
Consumer behavior

BUYING
INITIATOR ROLES

INFLUENCER

DECIDER

BUYER

USER

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RECAP
 Describe the consumer decision
making process with marketing
implications.

21
Consumer Decision-Making
Process
Need
Need Recognition
Recognition

Information
Information Search
Search
Cultural,
Cultural, Social,
Social,
Individual
Individual and
and
Psychological Evaluation
Evaluation
Psychological of
Factors
Factors of Alternatives
Alternatives
affect
affect
all
all steps
steps Purchase
Purchase

Postpurchase
Postpurchase
Behavior
Behavior 22
RECAP
 Describe in short the Porter’s 5
forces model

23
 Porter’s Five Forces
Model of Competition
Threat of
Threat of
New
New
Entrants
Entrants

Bargaining Rivalry Among Bargaining

Power of Competing Firms Power of
Suppliers in Industry Buyers

Threat of
Substitute
Products 24
RECAP
 Concept of STP

25
 3 STEPS
 • Segmentation: grouping consumers by some
criteria
 • Targeting: choosing which group(s) to sell to
 • Positioning: select the marketing mix most
appropriate for the target segment(s)

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SMITU MALHOTRA
What is Marketing?

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Marketing is about …
 CUSTOMER ANALYSIS……having
profound knowledge about
 How customers behave
 Their motivation

 Their Perception and preferences

 Their Attitudes

 Their knowledge

 Their emotions

It means segmenting the market correctly

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Marketing is about …
 UNDERSTANDING COMPETITORS

 Thinking about their reaction

 Their objectives
 And capabilities

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Marketing is about …
 KNOWING YOUR OWN COMPANY

 Company’s capabilities
 Culture
 Relationship with distributors
 Suppliers
 Other strengths and weaknesses

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GOAL OF MARKETING
 To make new consumers
 To retain old consumers

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 Marketing is the Business NOW!

Engi-
Prodn.
neering

R&D Quality
Customers Marketing
Info. Supply
Systems Chain
Finance HRD

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 SUMMARY

CUSTOMER COMPANY

COMPETITOR
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FORMAT
 WHAT ARE THE ELEMENTS OF
MARKETING MIX
 HOW THEY WORK TOGETHER

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WHAT IS MARKETING MIX
 A COMBINATION OF DETAILED
STRATEGIES,TACTICS, OPERATIONAL
POLICIES , TECHINUQUES AND
ACTIVITIES TO WHICH RESOURCES
MAY BE ALLOCATED SUCH THAT
COMPANIES MARKETING OBJECTIVES
ARE ACHIEVED.

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THE ELEMENTS OF MARKETING
MIX
 PRODUCT
 PRICE
 PLACE
 PROMOTION
 PEOPLE
 PROCESSESS
 PHYSICAL EVIDENCE

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 4 Ps / 4 Cs / 4 As
of Marketing Mix
 PRODUCT & PACKAGING - CUSTOMER
SOLUTIONS – ACCEPTABILITY

 PRICING - CUSTOMER SACRIFICE –

AFFORDABILITY

 PROMOTION - CUSTOMER COMMUNICATION –

AWARENESS

 PLACEMENT / DISTRIBUTION - CUSTOMER

CONVENIENCE – ACCESSIBILITY

Please note that all these are 37

customer centric !
PRODUCT
 PRODUCT CONCEPT
 PRODUCT PACKAGING
 PRODUCT NAME
 BRANDING
 PRODUCT MIX

38
PRICE
 MANUFACTURER VS RETAILER
PRICES
 PRICING OBJECTIVES
 PRICING STRATEGIES
 SKIMMING VS PENENTRATION
PRICING

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PROMOTION
 ADVERTISING
 SALES PROMOTION
 DIRECT MARKETING
 PERSONAL SELLING
 PUBLIC RELATIONS
 TRADE SHOWS AND SPECIAL EVENTS

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PLACE
 CHANNEL LENGTH
 CHANNEL BREADTH
 CHANNEL MEMBER MANAGEMENT

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INTERDEPENDENCE
 WITHIN EACH CATEGORY
 BETWEEN CATEGORIES

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 MARKETING MIX HAS TO BE ALIGNED
WITH THE NEEDS OF THE TARGET
MARKET.

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PRODUCT DOMINANT

 SONY.
 ROLLS ROYCE.
 GOOD KNIGHT AND FROOTI.

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PRICING DOMINANT

 NIRMA.
 THE “GREY MARKET”.
 AIR DECCAN.

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PROMOTION DOMINANT

 COOL DRINKS.
 MAGGI KETCHUP.
 CHOCOLATES.

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PLACE DOMINANT

 UNILEVER.
 ITC.
 ASIAN PAINTS.

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HOW THEY WORK TOGETHER
 THE FOUR VARIABLES MARKETER
CAN USE IN DIFFERENT
COMBINATIONS TO CREATE
CUSTOMER VALUE.

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ITC - SUNFEAST

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OBJECTIVE

 TO SHOW HOW ELEMENTS OF

MARKETING MIX WORK IN TANDEM

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BISCUIT MARKET
 2 MAJOR PLAYERS – PARLE AND
BRITANNIA
 82 %MKT SHARE

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WHY BISCUITS?
 FOOD SEGMENT --- Rs 550,000Cr
 ONLY 6% BRANDED AND PACKAGED
 BISCUITS [Rs 4000Cr] TEMPTING AS
GROWING AT 12% YOY
 BUSINESS SYNERGY

 ……..BUT HLL HAD FAILED.

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SUNFEAST – THE GAMEPLAN
MARKET RESEARCH REVEALED

 CONSUMER WISHED TO TASTE NEW

AND INNOVATIVE PRODUCTS
 BETWEEN 2000 AND 2005 NO NEW
LAUNCH

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SUNFEAST – THE PRODUCT RANGE
LAUNCHED IN 2003 WITH 6 RANGES
 MARIE – ORANGE AND LIGHT

 BUTTERSCOTCH FLAVOURED CREAM

BISCUITS
 GLUCOSE,BOUBORN,MARIE PLAIN

IN 2004 LAUNCHED SUNFEAST

 MILKY MAGIC
 SNACKY

 GOLDEN BAKES

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SUNFEAST – PLACE [DISTRIBUTION]
 TOBACCO NETWORK A HELP IN
UNDERSTANDING DISTN
 USED EXISTING NETWORK
 BRAND AVAILABLE AT 1.8 MILLION
OUTLETS AGAINST BRITANNIA AT 3.3
m AND PARLE AT 1.6 m OUTLETS

55
SUNFEAST – PROMOTION
 Aug 2003 – major sampling exercise
 2005 –ADVTS TARGETTING
CHILDREN IN CARTOON CHANNELS
 MOTHERS IN GENERAL CHANNELS
 SHAHRUKH KHAN AND SURYA IN
SOUTH AS BRAND AMBASSADORS
 ANNUAL SPEND –35-40% T.O. FRM
BISCUITS INTO PROMOTIONS
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SUNFEAST - PRICING
 2 MODELS EXISTING IN THE MARKET
 PARLE – LOW PRICE – HIGH VOL
 BRITANNIA – HIGH MARGINS IN
CREAM VARIETY AND VOLUMES
FROM MARIE AND GLUCOSE
 ITC – FOLLOWED BRITANNIA ROUTE

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KEY CHALLENGES
 PRESENT SHARE(IN VALUE TERMS) –
ONLY 6.3% OF MARKET
 BRITANNIA- 37%
 PARLE -31%

 GAP STILL WIDE

 BRITANNIA AND PARLE HAVE HIGH
VOLUMES AND CAN PLAY THE PRICE
GAME BUT NOT ITC.
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 59
SOURCE – BUSINESS WORLD 29TH MAY 2006
THUS ………..
 THE FOUR VARIABLES MARKETER
CAN USE IN DIFFERENT
COMBINATIONS TO CREATE
CUSTOMER VALUE.


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Ideas/issues for Ad analysis
excercise

 COMMUNICATION OBJECTIVE
 HOW WELL DOES AN AD EMPHASIZE WHAT
THE PRODUCT DOES?..ITS
DIFFERENTIATING FEATURE?
 TARGET AUDIENCE
 POSITIONING
 MEDIA CHOICE VALID?

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