MARKETING MANAGEMENT 1

MARKETING MANAGEMENT 1An Introduction to MarketingMarketing is an ExchangeThe customer seeks benefits from the company and pays for the product.

The company offers benefits to its customers and seeks profits.CustomerCompanyWhat We Can MarketGoodsServicesExperiencesEventsPeoplePlaces InformationIdeas IndustriesCompaniesThe Marketing Framework5 Cs

STP

4PsThe Marketing Framework 5 CsBegin with situation analysis:

Customers- Who are they? What are they like? Do we want to draw different customers?

Company- What are our strengths and weaknesses? What customer benefits can we provide?

Context- What is happening in our industry that might reshape our future business?

Collaborators- Can we address our customers needs while strengthening our B2B partnerships?

Competitors-Who are the competitors we must consider? What are their likely actions and reactions?The Marketing Framework- STPWith the background analysis, proceed to strategic marketing planning via STP:

Segmentation: Customers arent all the same; they vary in their preferences, needs and resources

Targeting: Attracting some of those customers makes better sense than going after all

Positioning: Communicate your benefits clearly to your intended customersThe Marketing Framework- 4PsMarketing tactics to execute the planning:

Product- Will customers want what your company is prepared to produce?

Price- Will customers pay what youd like to charge?

Place- Where and how will customers purchase your market offering?

Promotion- What can you tell your customers or do for them to entice them to purchase?The 4Ps ComponentsProductVarietyQualityDesignFeaturesBrand nameServicesWarrantiesReturnsPriceList priceDiscountsCredit termsPromotionSales promotionTrade promotionAdvertisingPR/PublicityPersonal Selling/Direct Marketing

PlaceChannelsCoverageLocationsInventoryLogisticsMarketing Mix8Marketingis meeting needs profitably

MASLOWS HIERARCHY OF NEEDSWhat is a Product?A particular bundle of benefits which satisfies particular needs and wants.

Anything that can be offered to a market to satisfy a want or need.

Products include tangible goods, intangibles, ideas. (for the purpose of class discussion, the word product would imply all of these)

11Most tangible products have intangibles attached (an Airconditioner has intangible benefits like financing, customer education, after sales service offered with purchase)

Changing Concepts in Marketing

The Production concept Holds that consumers will prefer products that are widely available and inexpensive

The Product concept Holds that consumers will favor those products which offer the best quality, performance or innovative features

The Selling concept Whatever is produced will sell

Marketing Management PhilosophiesProduction Concept

Product ConceptSelling ConceptMarketing ConceptSocietal Marketing ConceptCustomer-Driven Marketing and Sales Concepts Contrasted

Societal Marketing Concept

15ValueThe benefits that the customer derives out of the product over and above the cost of the product . Benefits = Functional + Emotional

Costs = Monetary + Time + Energy + Opportunity

16The marketer can increase the value of the customer offering in several ways :Raise benefitsReduce costsRaise benefits and reduce costsRaise benefits by more than the raise in costsLower benefits by less than the reduction in costs

The customer who is choosing between two value offerings, V1 and V2, will examine the ration V1 : V2. He or she will favor V1 if the ration is larger than the one; he/she will favor V2 if the ratio is smaller that one; he/she will be indifferent if the ratio equals one.

Government agencies sell their products at lower prices than private sector. Several customers still opt for the private sector offerings, as in the case of Jet Airways vis a vis Air India. Why? Because of the other related costs involved in flying Air India (delays) and the emotional benefits offered by Jet Airways.

The marketer can increase the value of the customer offering in several ways :

Raise benefitsReduce costsRaise benefits and reduce costsCustomer / ConsumerA Customer may be defined as - A potential consumer of a product OR- A person who is targeted by through communication

A Consumer may be defined as - One who consumes the product

18Customer SatisfactionDependent on the products perceived performance relative to a buyers expectations.

19Customer Perceived ValueCustomers evaluation of the difference between all the benefits and all the costs of a marketing offer relative to those of competing offers.Customer Relationship ManagementThe process of building and maintaining profitable customer relationships by delivering superior customer value and satisfaction.Customer Loyalty & RetentionCustomer Lifetime ValueThe entire stream of purchases that the customer would make over a lifetime of patronage.Share of CustomerThe share a company gets of the customers purchasing in their product categories.Issues & Challenges in Marketing in IndiaHigh volatility in marketDiversity & convergenceCatering to the affluentPoor markets also need marketingEngaging customer 24 x 7Enhancing accessIssues & Challenges in Marketing in IndiaPrice and value major determinants in consumption behaviorIndian global brands..?Ecology sensitivityWord of mouth a stronger influence in adoption24Marketing FundamentalsThe very essence of marketing is satisfying customer needsThe Marketing function develops a value proposition to satisfy those needsAn important function of Marketing is promotionThe Marketing function strives to develop a sustainable competitive advantage through product features, technology, pricing, positioning and placement, and organizational learningAll other functions are strategically aligned to meet Marketings objectivesIn todays competitive global marketplace, companies face a singular challenge: INNOVATE OR PERISH25Innovation in MarketingInnovation in Marketing satisfies customer needs and develops a competitive advantage through differentiation along one or more of the following performance characteristics: Desired Product Features and Design Size Usability Quality Time Price Cost savings/ Incremental Revenues26