chp1 2 -marketing management
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Marketing Management
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What is Marketing??
Selling?
Advertising?
Promotions?
Making products available in stores?
Maintaining inventories?
All of the above, plus much more!
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Marketing = ?
Marketing is the process of planning and
executing the conception, pricing, promotion,
and distribution of ideas, goods, services to
create exchanges that satisfy individual and
organizational goals
American Marketing Association
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Marketing = ?
Marketing management is the art and science of
choosing target markets and getting, keeping, and
growing customers through creating, delivering, andcommunicating superior customer value.
Marketing management is the art and science of
choosing target markets and getting, keeping, and
growing customers through creating, delivering, andcommunicating superior customer value.
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Marketing = ?
The Process That seeks to influence
voluntary exchange transactions between
a customer and a marketer. The Marketing
process involves communication and
requires a mechanism or system to carry
out th
e exch
ange of th
e marketers productfor something of the value.
The Process That seeks to influence
voluntary exchange transactions between
a customer and a marketer. The Marketing
process involves communication and
requires a mechanism or system to carry
out th
e exch
ange of th
e marketers productfor something of the value.
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Marketing as a Concept
Marketing concept involves:
(a) customer orientation
(b) competition orientation
(c) the ability to respond to environmental
changes (changes in consumer needs,
competition, government policy, technology,
etc.) before the competition.
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What is marketing orientation and
how can it be employed in
organisation?(a) Consumer-orientation
Successful marketing companies continuously
monitor customer needs, wants and preferences.
Unfulfilled consumer needs drive their new
product development efforts.
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What is marketing orientation and
how can it be employed in
organisation?(b) An integrated approach to exploiting market
opportunities
Integrate all elements of the marketing mix, and
not just merely advertising and selling, into a
sound business plan that could help tosuccessfully fight competition.
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What is marketing orientation and
how can it be employed in
organisation?(c) Futuristic approach
Money spent on marketing not an expenditure but
an investment.
Invest in market share development activities
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What is marketing orientation and
how can it be employed in
organisation?d) Highly developed marketing systemsHighly developed marketing systems that act as
market barometers.
Commonly used systems relate to complaint
management, customer feedback, customer
relationship management (CRM) and today even
e-CRM.e) Marketing culture pervades the organisation
f) Speed in responding to customer's problems
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Simple Marketing System
Industry(a collection
of sellers)
Market(a collection
of Buyers)
Goods/services
Money
Communication
Information
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Marketing = ?
Marketing is the sum of all activities that take you to a
sales outlet. After that sales takes over.
Marketing is all about creating a pull, sales is all about
push. Marketing is all about managing the four Ps
product
price
place promotion
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Marketing Mix
The Specific combination of interrelated and
interdependent marketing activities in which an
organization engages to meet its objectives.
The basic elements of the marketing mix :
product, place, price, and promotion; also called
the controllable variables of marketing, because
they can be controlled and manipulated by the
marketer.
The Specific combination of interrelated and
interdependent marketing activities in which an
organization engages to meet its objectives.
The basic elements of the marketing mix :
product, place, price, and promotion; also called
the controllable variables of marketing, because
they can be controlled and manipulated by the
marketer.
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The 4 Ps & 4Cs
Marketing
Mix
Product
Price Promotion
Place
Customer
Solution
Customer
Cost
Communication
Convenience
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Place ( Distribution )
The element of the marketing mix that encompasses
all aspects of getting products to the consumer in
the right location at the right time.
Channel of Distribution Manufacturer Wholesaler
- Retailer Ultimate consumer.
The element of the marketing mix that encompasses
all aspects of getting products to the consumer in
the right location at the right time.
Channel of Distribution Manufacturer Wholesaler
- Retailer Ultimate consumer.
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Promotion
The element of the marketing mix that includes all
forms of marketing communication.
The element of the marketing mix that includes all
forms of marketing communication.
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Price
The amount of money or other consideration that
is, something of value given in exchange for a
product/service.
The amount of money or other consideration that
is, something of value given in exchange for a
product/service.
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Difference Between - Sales & Marketing ?Difference Between - Sales & Marketing ?
Salestrying to get the customer to want what the
companyproduces
Marketingtrying to get the company produce what the
customerwants
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Marketing and Selling Orientations
Orientation/
Concept
Focus Means Ends
Selling Product Aggressive selling and sales
promotion with emphasis on price
variations to close the sale. I mustsomehow hook the customer.
Maximise profits
through sales
maximization
Marketing
Marketing
Customer
Customer
Integrated marketing plan
encompassing product, price,
promotion and distribution backed up
by adequate environmental scanning,consumer research and opportunity
analysisemphasis on service "what
can we do that will make us better
than and superior to our competitors,
in the customer's eyes "?
Maximise profits
through increased
consumer satisfaction
and hence highermarket share.
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Scope What do we market
Goods
Services
Events
Experiences
Personalities
Place
Organizations
Properties Information
Ideas and concepts
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Core Concepts of Marketing
Based on :
Needs, Wants, Desires / demand
Products, Utility, Value & Satisfaction
Exchange, Transactions & Relationships
Markets, Marketing & Marketers.
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Needs, wantsdemands
Markets Marketing &
Marketers
Utility, Value &Satisfaction
Xchange, Transaction
Relationships
Products
Core Concepts of Marketing
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Core Concepts of Marketing
Need food ( is a must )
Want Pizza, Burger, French fry's ( translation of a
need as per our experience ) Demand Burger ( translation of a want as per our
willingness and ability to buy )
Desire Have a Burger in a five star hotel
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In order to understand Marketing let us begin withthe Marketing Triangle
Customers
CompetitionCompany
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Who is a Customer ??
Anyone who is in the market looking at a product /
service for attention, acquisition, use or consumption
that satisfies a want or a need
CUSTOMER IS . . . . .
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Customer
CUSTOMER has needs, wants, demands anddesires
Understanding these needs is starting point of theentire marketing
These needs, wants arise within a frameworkor an ecosystem
Understanding both the needs and the ecosystemis the starting point of a long term relationship
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How Do Consumers Choose Among
Products & Services?
Value - the value or benefits the customers gain from
using the product versus the cost of obtaining the
product.
Satisfaction - Based on a comparison of performanceand expectations.
Performance > Expectations => Satisfaction
Performance < Expectations =>Dissatisfaction
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Customers - Problem Solution
As a priority , we must bring to our customers
WHAT THEY NEED
We must be in a position toUNDERSTAND
theirproblems
Or in a new situation to give them a chance to
AVOID the problems
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Customer looks for ValueCustomer looks for Value
Value = Benefit / Cost
Benefit = Functional Benefit + Emotional
Benefit
Cost = Monetary Cost + Time Cost +
Energy Cost + Psychic Cost
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Analysis Of CompetitionAnalysis Of Competition
Whoare your competitors?
Whatare their strengths and weaknesses?
Whathave been their strategies?
Howare they likely to respond to your
Marketing plan?
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Strategic MarketingStrategic Marketing
Strategic marketing management is concerned with
how we will create value for the customer
Asks two main questions
What is the organizations main activity at aparticular time? Customer Value
What are its primary goals and how will these be
achieved? how will this value be delivered
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Strategic PlanningStrategic Planning
Strategic Planning is the managerial process of
creating and maintaining a fit between the
organizations objectives and resources and the
evolving market opportunities.
Also called Strategic Management Process
All organizations have this
Can be Formal or Informal
Strategic Planning is the managerial process of
creating and maintaining a fit between the
organizations objectives and resources and the
evolving market opportunities.
Also called Strategic Management Process
All organizations have this
Can be Formal or Informal
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The Strategic-Planning, Implementation,
and Control Process
The Strategic-Planning, Implementation,
and Control Process
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Business Strategic-Planning Process
External environment
(Opportunity &
Threat analysis)
Internal Environment
(Strength/ Weakness analysis)
Goal FormulationBusiness Mission
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Strategy Formulation
Environmental Analysis
Internal AnalysisCompetitor
Customer
Supplier
Regulatory
Social/ Political
Technology Know-How
Manufacturing Know-How
Marketing Know-How
Distribution Know-HowLogistics
Strength & Weaknesses
Identity Core Competencies
Opportunities & Threats
Identify opportunity
Fit internal Competencies with external opportunities
Firm Strategies
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The Marketing Plan
A written document that acts as a guidebook of
marketing activities for the marketing manager
A written document that acts as a guidebook of
marketing activities for the marketing manager
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CONTENTS of MARKETING PLANCONTENTS of MARKETING PLANBusiness Mission Statement
Objectives
Situation Analysis (SWOT)
Marketing Strategy
Target Market Strategy
Marketing Mix Positioning
Product
Promotion
Price
Place Distribution People
Process
Implementation, Evaluation and Control
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The Marketing ProcessThe Marketing Process
Business
MissionStatemen
t
Objectives
Situationor SWOT
Analysis
ImplementationEvaluation, Control
Target MarketStrategy
Marketing Strategy
Product
Promotion
Place/Distribution
Price
Marketing Mix
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Marketing Environment
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Why a product like radio declined
and now once again emerging as
an entertainment medium ?
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What Were the Drivers of This Change ?
Technology ?
Government policy ?
Other media substitutes ?
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Why Market Leaders Suffered ?
HMT vs. Titan
HLL vs. Nirma
Bajaj vs. Honda Dot.com boom, then bust and now resurgence
Market leadership today cannot be taken for
granted.New and more efficient companies are able
to upstage leaders in a much shorter period.
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Factors
Influencing
Companys
Marketing
Strategy
Factors
Influencing
Companys
Marketing
Strategy
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Demographics
SocialChange
EconomicConditions
Political &Legal Factors
Technology
Competition
EnvironmentalScanning
EnvironmentalScanning
Target Market
ProductDistributionPromotion
Price
External Environmentis not controllable
External Environmentis not controllable Ever-Changing
MarketplaceEver-Changing
Marketplace
External Marketing EnvironmentExternal Marketing Environment
Physical / Natural
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The macro-environmentThe macro-environment
is the assessment of the external forces that actupon the
firm and its customers, that create threats & opportunities
Th M k ti Mi I t d
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The Marketing Mix In todays
world
The conventional view of the marketing mix consisted offour components (4 Ps): Product, Price, Place/
distribution andPromotion.
Generally acknowledged that this is too narrow today; now
includes , Processes, Productivity[technology ]People
[employees], Physical evidence
Marketers today are focused on virtually all aspects of the
firms operations that have the potential to affect the
relationship with customers.
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The Give and Get of Marketing
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GreatWords on Marketing
1. The purpose of a company is to create a customerThe only
profit center is the customer.2. A business has twoand only twobasic functions: marketing
and innovation. Marketing and innovation produce results: all the
rest are costs.
3. The aim of marketing is to make selling unnecessary.
4. While great devices are invented in the Laboratory, greatproducts are invented in the Marketing department.
5. Marketing is too important to be left to the marketing
department.
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Drivers of Customer Satisfaction
Many aspects of the firms value proposition contribute tocustomer satisfaction:
The core product or service offered
Support services and systems
The technical performance of the firm Interaction with the firm and it employees
The emotional connection with customers
Ability to add value and to differentiate as a firm focuses
more on the top levels
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Marketers and Markets
Marketers are focused on stimulatingexchanges with customers who make upmarkets B2C or B2B.
The market is comprised of people who play aseries of roles: decision makers,
consumers, purchasers, and influencers.It is absolutely essential that marketers have adetailed understanding of consumers, theirneeds and wants.
Much happens before and afterthe sale to
affect customer satisfaction
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Stages of Customer Interaction
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What Changed in Marketing
Organize by product units Focus on profitable transactions
Look primarily at financialscorecard Focus on shareholdersMarketing does the marketing Build brands through advertising Focus on customer acquisitionNo customer satisfaction
measurementOver-promise, under-deliver
Organize by product units Focus on profitable transactions
Look primarily at financialscorecard Focus on shareholdersMarketing does the marketing Build brands through advertising Focus on customer acquisitionNo customer satisfaction
measurementOver-promise, under-deliver
Organize by customer segments
Focus on customer lifetime value
Look also at marketing scorecard
Focus on stakeholders
Everyone does the marketing
Build brands through performance
Focus on customer retention
Measure customer satisfaction andretention rate
Under-promise, over-deliver
Old Economy New Economy
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Check Your Understanding
1. Marketing is the process of --------------- and----------- the conception, pricing, promotion,and distribution of ideas, goods, services tocreate exchanges that satisfy individual andorganizational goals.
2. Marketing management is the ------- and------------ of choosing target markets andgetting, keeping, and growing customersthrough creating, delivering, and
communicating superior customer value.
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Check Your Understanding
3.Consumer-orientation Successfulmarketing companies continuously monitor
customer needs, wants and preferences.
Unfulfilled consumer needs drive their new
product development efforts. ( True / False
)
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Check Your Understanding
4. Marketing is all about creating a -----------, sales is all about --------------.
5. Marketing is all about managing the four Ps
product
price
place
---------------
6. Marketing triangle is Customer , Company and ---------------.
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5
75
7
Check Your Understanding
7. Value = Benefit / ---------
8. Performance < Expectations => Dissatisfaction (True
/ False )
9. SWOT = -----------------------------------------------------
10. Demographic environment is a macro environment
aspect in marketing. ( True / False )
Ch k Y U d t di
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Check Your Understanding -
Answers
1. Planning , executing2. Art , Science
3. True
4. Pull , Push
5. Promotion6. Competitors
7. Cost
8. True
9. Strength, Weakness, Opportunity, Threat10. True
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Thank You