WHAT IS MARKETING ? Marketing is a social process by which individuals and groups obtain what they need and want through creating and exchanging products and value with others PHILIP KOTLER NEEDS ,WANTS and DEMANDS --PRODUCTS------VALUE & SATISFACTION--EXCHANGE & TRANSACTION---MARKETS & MARKETERS WHAT IS MARKETING ? The essence of Marketing is a transaction - an exchange- intended to satisfy human needs and wants. There are three elements in the marketing process : (A) MARKETERS (B)WHAT IS BEING MARKETED (C) TARGET MARKET NEEDS,WANTS AND DEMANDS NEED : A state of felt deprivation of some basic satisfaction ( Food, Clothing, Shelter, Belonging etc. ) WANTS : Wants are desires for specific satisfiers of the deeper needs. Needs are few and wants are many . DEMANDS : are wants backed by ------Ability to buy and Willingness to buy PRODUCTS / OFFERS / SATISFIERS / RESOURCES Anything that can be offered to someone to satisfy a need or want is a product . Product refers to physical object Services refer to intangible object VALUE AND SATISFACTION Value is the customers’ estimate of the Product’s capacity to satisfy a set of goals Customer gets benefits & assume costs WHEN :Customer Customer Expectance>Performance (dis-satisfied) Customer Expectance<Performance (Highly satisfied) Expectance=Performance (satisfied) EXCHANGE AND TRANSACTION Exchange is a process rather than event. It is a value creating process because it normally leaves both parties better off. A transaction is a trade of values between two or more parties ( A BARTER TRANSACTION OR A MONETARY TRANSACTION ). WHAT IS MARKET ? A market consists of all the potential customers sharing a particular need or want who might be willing and able to engage in exchange to satisfy that need or want. WHAT IS MARKETING MANAGEMENT ? Marketing Management planning, implementation programs designed to is the and analysis, control create, build of and maintain beneficial exchanges and relationships with target markets for the purpose achieving Organisational objectives. of WHAT IS MARKETING MANAGEMENT ? Marketing management management or it involves is the demand task of influencing the level, timing and composition of demand. At times the actual demand level may be below, equal to, or above the desired demand level and the major task of marketing management is to regulate the level of demand. STATE OF DEMAND AND MARKETING TASK State of demand Negative Demand No Demand Latent Demand Falling Demand Irregular Demand Full Demand Overfull Demand Un-wholesome Demand Marketing task Conversional Mktg. Stimulational Mktg. Developmental Mktg. Remarketing Synchro-marketing Maintenance Mktg. Demarketing Counter-marketing EVOLUTION OF MARKETING MANAGEMENT Marketing management has evolved through following stages : (1) Production Orientation Stage (2) Sales Orientation Stage (3) Marketing Orientation Stage (4) Social Responsibility & Human Orientation Stage COMPANY ORIENTATION FOR MARKETING ACTIVITIES Marketing Management can be defined as the effort to achieve desired EXCHANGE outcomes with TARGET MARKETS. Now the question arises : (1) What philosophy should guide the marketing activities? (2) What weights should be given to the interests of the organisation, the customers and the society? 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. MARKETING CONCEPT, DIMENSIONS There are FIVE competing concepts under which organizations conduct their marketing activities: The Production Concept The Product Concept The Selling Concept The Marketing Concept The Societal Marketing Concept (1) THE PRODUCTION CONCEPT Company Produce more & more Produce Consumers Sell Practically sells itself THE PRODUCTION CONCEPT Consumers will favour those products that are widely available and low in cost. Therefore increase production and cut down costs. And build profit through volume. (2) THE PRODUCT CONCEPT Produce Quality Products Sell Practically sells itself,if it gives most quality for money Consumers Buyers admire well-made products and can appraise product quality and performance. THE PRODUCT CONCEPT Consumers will favour those products that offer the most quality, performance, or innovative features. Therefore, improve quality, performance and features. This would lead to increased sales and profits. (3) SELLING CONCEPT Consumers have normal tendency to resist. Produce Sell it Aggressive selling & promotion efforts Consumers Making sales becomes primary function and consumer satisfaction secondary . THE SELLING CONCEPT Consumers , if left alone , will not buy enough of company’s products. Therefore, promote sales aggressively. And,build profit through quick turnover. (4) MARKETING CONCEPT “ LOVE THE CUSTOMER , NOT THE PRODUCT ” Learn what they want(MR) Produce it Consumers Market it Sell what they want(Satisfy needs of customers) THE MARKETING CONCEPT The key to achieving organizational goals consist in determining the needs and wants of target markets and delivering the desired satisfactions more effectively and efficiently than competitors. And build profit through customer satisfaction and loyalty. (5) THE SOCIETAL MARKETING CONCEPT It is Marketing Concept (+) Society’s well being. Balancing of following three considerations while setting marketing policies : Customer’s want satisfaction Society’s well being Company’s profits THE SOCIETAL MARKETING CONCEPT The societal marketing concept holds that the organization’s task is to determine the needs, wants, and interests of target markets and to deliver the desired satisfactions more effectively and efficiently than competitors in a way that preserves or enhances the consumer’s and the society’s well being. It addresses conflicts between consumer’s and firm’s short run wants and long term welfare. STRATEGIC CONCEPT OF MARKETING Shifted the focus of Marketing from Product or customer to the CUSTOMER IN THE CONTEXT OF THE BROADER EXTERNAL ENVIRONMENT . To succeed, customer in marketers a context must know the including the competition, Govt. Policy& regulation and the broader economic, social and political macro forces that shape the evolution of market. STRATEGIC CONCEPT OF MARKETING Shifted the Marketing Objectives from PROFIT TO STAKEHOLDER BENEFITS. Stakeholders are individuals or groups who have an interest in the activity of a company . They include-----The employees and management, Customers, Society, Shareholders, Financiers/ Bankers, Government etc. STRATEGIC CONCEPT OF MARKETING Strategic Marketing Concept is Strategic Management, which integrates marketing with the other management functions. ( Major task is Profit for Stakeholders’ benefits ). MARKETING SYSTEM Marketing is concerned with the flow of goods and services from the points of production to the points of consumption. There is a systematic arrangement of these functions of marketing to move the goods and services to the needy persons. This system is essential to the creation of time, place and possession utilities. GOALS OF THE MARKETING SYSTEM MAXIMIZE CONSUMPTION MAXIMIZE CONSUMER SATISFACTION MAXIMIZE CHOICE MAXIMIZE LIFE QUALITY THREE LEVELS OF MARKETING Responsive Marketing Anticipative Marketing Need Shaping Marketing RESPONSIVE MARKETING It is the form of marketing when some company defines an existing clear need and prepare an affordable solution. (Recognizing that women wanted to spend less time for cooking and cleaning, led to the invention of modern washing machine, microwave oven etc.) ANTICIPATIVE MARKETING It is a form of marketing when a company recognize an emergent or latent need, and come out with an affordable solution. Evian, Perrier anticipated growing market for bottled drinking water as the quality of water deteriorated in many places. Anticipative marketing is more risky than responsive marketing; companies may come into market too early or too late, or may even be totally wrong about thinking that such a market would develop.(eg. Dish washers in India) NEED SHAPED MARKETING The broadest level of marketing occurs when a company introduces product that nobody asked for and often could not even conceive of. (e.g. Sony Walkman, Sony Compact Disc ) Late Akio Morita, founder and chairman of Sony, who introduced these and many other new products, summarized his marketing philosophy in these words: them.” “ I don’t serve markets. I create The Scope Of Marketing Marketers are involved with marketing ten types of entities: Physical Goods Service Experiences Events Persons Places Properties Organizations Information Ideas Exchange and Marketing Pots Hats bats soap knife Ten exchanges required without central market In very basic economic systems, each seller must meet directly with each buyer in order to exchange something of value. As needs increase, the number of exchanges can soon become unmanageable for one person. In a centralized market, a buyer can go to one location to find many different products from many different sellers. By reducing the time both buyers and sellers must spend to complete an exchange, prices can be lowered. Pots Central market middleman Hats soap bats knife Five exchanges required with central market PRODUCTS / OFFERS / SATISFIERS / RESOURCES Consumer markets Business markets Global markets Nonprofit/Government markets Marketing Functions Environmental analysis and marketing research: Monitoring and adapting to external factors that affect success or failure, such as the economy and competition; and collecting data to resolve specific marketing issues. Broadening the Scope of Marketing: Deciding on the emphasis to place, as well as the approach to take, on societal issues, global marketing, and the Web. Consumer analysis: Examining and evaluating consumer characteristics, needs and purchase processes; and selecting the group(s) of consumers at which to aim marketing efforts. Marketing Functions continued Product planning (including goods, services, organizations, people, places, ideas): Developing and maintaining products, product assortments, product images, brands, packaging, and optional features, and deleting faltering products. Distribution planning: Forming logistical relationships with intermediaries, physical distribution, inventory management, warehousing, transportation, allocating goods and services, wholesaling, and retailing. Promotion planning: Communicating with customers, the general public, and others through some type of advertising, public relations, personal selling, and/or sales promotion. Marketing Functions continued Price planning: Determining price levels and ranges, pricing techniques, terms of purchase, price adjustments, and the use of price as an active or passive factor. Marketing management: Planning, implementing, and controlling the marketing program (strategy) and individual marketing functions; appraising the risks and benefits in decision making; and focusing on total quality. Marketing Functions (Remember) Facilitating Functions Physical Functions Exchange Functions Buying and Selling Transportation DONE FOR THE DAY