Marketing Fundamentals- Session 1 -

Flow

• What is Marketing?

• Difference between Marketing and Selling

• The Marketing Process

• Key Concepts in Marketing

What is Marketing?- What can you market?

- Evolution of the ‘Marketing Concept’ - Marketing – A Definition

What can you market? – An Exercise

• List down all responses

• Bucket them into groups and label them (see next slide)

• Is the marketer always the buyer?

What can you market?

Products Services

Concepts

Evolution of the ‘Marketing Concept’

The Production

Concept

• Consumers will buy products that are widely available and low in cost

The Product Concept

• Consumers will buy products that offer the best quality or performance

The Selling Concept

• Organization must undertake aggressive selling efforts to make customers buy

The Marketing Concept

Ref: Marketing Management by Philip Kotler

The Marketing Concept

Determine Needs and Wants of target markets and deliver the desired satisfaction more effectively

and efficiently than the competition

Product Oriented vs Market Oriented Definitions - Levitt

Revlon We make cosmetics We sell hope

Xerox We make copying equipment

We help improve office productivity

Encyclopedia Brittanica

We sell encyclopedias

We are in the information

production and distribution business

Carrier We make air conditioners and

furnaces

We provide a comfortable climate

at home

Volvo?

Difference between Marketing & Selling

Difference between Marketing & Selling

Factory Products Selling & Promotions

Profits through Sales Volume

Ref: Marketing Management by Philip Kotler,

Market Customer Needs Co-ordinated Marketing

Profits through Customer Satisfaction

Starting Point Focus Means Ends

Pen Exercise

The Marketing Process

Steps in the Marketing Process

Analyze Market Opportunities

Research and Select Target

Markets

Design Market Strategies

Implement and Evaluate marketing

initiatives

Plan Marketing Programs

Key Concepts in Marketing- Needs, Wants & Demand

- Target Market- Marketing Mix (4 Ps)

Needs, Wants, Demand

Some Definitions - Kotler

NeedA state of felt deprivation of some basic

satisfactionEg: Food, Clothing, Safety, Belonging…

Want

Demand

Desire for specific satisfiers of these needsEg: Burger, Mercedes Benz, an LV Bag etc.

Different for different socio-cultural structures

Wants backed by ability and willingness to buyEg: # of people who want a Merc and can buy it

Exercise – Need, Want & Demand

Demand States – 1

Negative Demand • Market dislikes the product and may even pay to avoid it• Eg: Dental work; ex-convicts as employees

No Demand • Market is indifferent to product• Eg: Foreign Language Course in Swahili

Latent Demand • Strong need but no available product• Eg: Mobile app development firm

Falling Demand • Drop in demand for an erstwhile strong product• Eg: Blockbuster

Ref: Marketing Management by Philip Kotler

Demand States – 2

Irregular Demand • Seasonal variations in demand• Eg: Easter stuff

Full Demand/Overfull Demand

• Demand that can be met by business/that cannot be met• Eg: Boeing

Unwholesome Demand

• Demand for products that are perceived as harmful• Eg: Illegal drugs

Ref: Marketing Management by Philip Kotler

Demand States & Marketing Tasks - An Exercise

• Identify 2 products/services/concepts for each Demand States

• State what would be the Marketing Task if you were a business/organization providing that product/service/concept

Target Market

Selecting a Target Market

1. Market Segmentation1. Can we serve the entire market effectively? If not, then2. Break the total market into segments that share certain properties

1. Segmentation variables – age, gender, life-stage, product usage, needs…..

2. Measure attractiveness of segments1. Overall Size2. Growth3. Profitability4. Competition presence5. Need Gaps in market

3. Select most attractive segment

Segmentation Variables - Exercise

• Asusi Ltd. Plans to introduce a new range of tablets for the US market. There is heavy competition in this segment – a noted competitor being a behemoth here. The Asusi Marketing Team has done its homework and produce the following product/market grid analysis. Help Asusi identify which segments to target? And Why?

Segment 1Feature-driven

Segment 2Price-driven

Segment 3Convenience-driven

Size 15% 55% 30%

Demographic Profile Skews

Younger, affluent, males

Middle-aged, less affluent

Reasonably affluent, females

Growth 15% 6% 9%

# of key competitors

2 8 6

Examples of Segmented Target Marketing Approach

• Mercedes vs. Tesla• Exercise 2 – Select a set of Sports Leagues, and try to define the Market Segments & Target

Markets

The Marketing Mix

The 4 Ps of Marketing

What is the Marketing Mix/4 Ps of Marketing?

Marketing mix is the set of marketing tools that the firm uses to pursue its marketing objectives – Philip Kotler

Target Market

McCarthy’s 4-factor Classification – 4 Ps

Factors under each P

Target Market

McCarthy’s 4-factor Classification – 4 Ps

Variety, Quality, design, features, brand name, packaging, services, warranties…

List price, discounts, credit period, payment mode…

Channels, Locations, Assortment, Inventory, Transport

Sales Promotions, advertising, Salesforce, PR, DM …..

The 4 Ps –Exercise 1

• Categorise the following under the 4 Ps

– Advertising– Vending Machine– Free Samples– Retailing– After sales Service– Packaging– Posters– Credit terms– List Price– Coupons– Mailers– Discounts– Flavor

Product

Product Lifecycle

Introduction

Growth

Maturity

Saturation

Market Growth vs Market Share

Decline

Product Lifecycle – Exercise 1

Introduction

Growth

Maturity

Decline

Plot these strategies on the PLC:1. Significant sales growth;

investment in creating product/brand awareness and ramping up distribution

2. Profits not a priority; focus on investments

3. Sales growth begins to flatten; focus on pricing & promotions to maintain growth/shares

4. Product/Brand Extensions in order to continue to maintain demand

5. Marketing –spend cutting

Saturation

PLC – Exercise 2

• Plot the following products/services on the PLC:

– Desktops

– Paperbacks

– Corner bookstore

– Wearable computing

– Electric Cars

– Tablets

– Smart phones– Online Travel Booking

Product Mix/Product Line

• Also called Product Portfolio or Product Assortment

• Refers to the total range of products that a business offers

• Product Line Depth– Refers to the different sub-groups within a product line

• Product Mix Width

– Refers to the different types of products offered by a business within a broad umbrella mission

Starbucks example

Product Mix Strategy : An Example

CSD/(Carbonated Soft Drinks)/Soda

(Coca Cola Co.)Coke

Coke RegularCan

6.5 oz

12 oz

BottleDiet Coke

SpriteCoke Zero Fanta

Price

Broad Pricing Strategies

Skimming Premium

Economy Penetration

Product Quality

Pric

e

Low High

Low

Hig

h

Pricing - Exercise

Identify which pricing strategy is being adopted in each of the below cases:

• Tesla’s new introduction

• Google glasses

• A new Airline, Oceanic Air offers short-haul flights at $x lower than any other airline

• Amazon bundles free shipping into the cost of the latest best-seller by Malcolm Gladwell which is priced at $80.

• Walmart introduces a new range of private label groceries under their value brand

• Holiday-Inn introduces a package deal for a mid-week break

Place

Types of Channel Options

• Company Salesforce

• Distributors

• Wholesalers

• Retailers

• Agents/Franchisees

• Partners

• E-Commerce

• Companies change Distribution Channels over the PLC

• Channel Options differ based on B2C or B2B models

Promotion

The Communication Strategy

Tools

• Advertising• Sales Promotion• PR• Personal Selling

Vehicles• Print• TV• Radio• Outdoor• Internet/Social Media• Direct Mail• Events, Conferences

Positioning Strategy

When you have the 4 Ps figured out,

Use the 4 C test to evaluate from the Consumer’s POV

• Does it meet consumer needs? (PRODUCT)

• Is it at a favourable cost (vs competition)? (PRICE)

• Is it convenient to purchase ? (PLACE)

• Does the communication reach them? (PROMOTION)

Exercise

• Products/pictures of products

• What do you think were the 4 Ps for the product you picked up?

• Discuss answers,

Thank you