Marketing Management

Md. Abdul Hamid

Assistant Professor

Dept. of Business AdministrationDept. of Business Administration

Shahjalal University of Science and Technology

Bangladesh

(Now living in Denmark, Slovenia and Spain for higher studies.

Can be reached at mahamid.biz@gmail.com)

� the act or process of selling or purchasing

� the process or technique of the process or technique of the process or technique of the process or technique of promoting, selling, and promoting, selling, and promoting, selling, and promoting, selling, and distributing a product or servicedistributing a product or servicedistributing a product or servicedistributing a product or service

� Marketing…� Marketing…

� “the process of planning and executing

� the conception, pricing, promotion, and distribution of ideas, goods, and services to create exchange

� that satisfy individual and organizational goals.”

WantsWantsWantsWants…………“when needs are shaped by consumers’ culture it can be treated as wants.”

Demand

Human wants

that are backed by

buying power

Market

“the set of all

actual and potential buyers

of a Product”

� “Marketing deals with identifying and meeting social needs”

SatisfactionSatisfactionSatisfactionSatisfactionSatisfactionSatisfactionSatisfactionSatisfaction

“…. is the feeling of pleasure or displeasure that customers feel when

they compare the experience of a product with their expectations.”

� Marketing strategy…“the marketing logic(s) � “the marketing logic(s)

� by which � the business unit hopes � to achieve its marketing objectives.

� Goods...book, pen

� Services…teacher, doctor, programmer

� Experiences… magic, park

� Events...IPL, Close up1

� Persons…C. Ronaldo, MZI

� Places… Cox’sbazar, Jaflong� Places… Cox’sbazar, Jaflong

� Properties… real estate, securities

� Organizations… Red-cross, universities, Adhunik

� Information… TV news, brokerage house

� Ideas… consultants, architect

� Production concept… holds that consumers will

prefer products that are widely available and inexpensive.

� Product concept… holds that consumers will favor

those products that offer the most quality, performance, or those products that offer the most quality, performance, or innovative features.

� Selling concept… holds that consumers and

businesses, if left alone, will ordinarily not buy enough of the organization’s products. The organization must, therefore, undertake an aggressive selling and promotion effort.

Marketing concept…� Marketing concept…

� Customer orientation

� Integrated marketing

� Customer satisfaction

Relationship marketing…Relationship marketing…Relationship marketing…Relationship marketing…cultivating the right kind of relationships with

the right constituent groups (customers, channels, partners, media, govt. etc)

Integrated marketing…Integrated marketing…Integrated marketing…Integrated marketing…product offerings, price levels, communication

efforts, channel membersefforts, channel members

Internal marketing…Internal marketing…Internal marketing…Internal marketing…ensuring that every one in the organization

embraces appropriate marketing principles (top to bottom… apply marketing orientation)

Social responsibility marketing…Social responsibility marketing…Social responsibility marketing…Social responsibility marketing…ethical, environmental, legal, and social

context of marketing activities get priority

� DevelopingDevelopingDevelopingDeveloping… m. strategies and plans

� CapturingCapturingCapturingCapturing… m. insights

� ConnectingConnectingConnectingConnecting… customers

� BuildingBuildingBuildingBuilding… strong brands� BuildingBuildingBuildingBuilding… strong brands

� ShapingShapingShapingShaping… market offering

� CommunicatingCommunicatingCommunicatingCommunicating…value

� CreatingCreatingCreatingCreating… long term growth

� Globalization� Technology� Customer empowerment� Stiff competition� Powerful media� Powerful media� Deregulation� Privatization� Customization� Industry convergence� Disintermediation

� Basic marketing: The salesperson simply sells the

product.

� Reactive marketing: The salesperson sells the product

and encourages the customer to call if he or she has questions or complaints.

Accountable marketing: The salesperson contacts the � Accountable marketing: The salesperson contacts the

customer a short while after making the sale to check

whether the product is meeting expectations.

� Proactive marketing: The salesperson contacts the

customer from time to time with information about new products and product uses.

� Partnership marketing: The company works continuously

with the customer to discover ways to perform better.

� WorldwideWorldwideWorldwideWorldwide populationpopulationpopulationpopulation growthgrowthgrowthgrowth............India, China, Africa, Bangladesh(1.37percent)

� PopulationPopulationPopulationPopulation ageageageage mixmixmixmix…………Mexico (young populations). Japan (old populations)

� EthnicEthnicEthnicEthnic marketsmarketsmarketsmarkets………… showing respect to the preferences of small ethnic groups

� EducationalEducationalEducationalEducational groupsgroupsgroupsgroups………… illiterates, high school dropouts, high school� EducationalEducationalEducationalEducational groupsgroupsgroupsgroups………… illiterates, high school dropouts, high school

degrees, college degrees, and professional degrees.

� HouseholdHouseholdHouseholdHousehold patternspatternspatternspatterns………… nuclear family, single parents, living together,

divorcee, career centered etc. How do you expect household patterns to changein the next 20 years?

� Geographical shifts in population…Geographical shifts in population…Geographical shifts in population…Geographical shifts in population… urban life (employment), natural

calamities (safety), migration to develop countries (Canada, USA, Australia)

� growing debt problems in developing economies � the speeding up of international transportation,

financial transactions, and communication � the move to market economies in former communist

countries countries � an explosion of strategic alliances among

multinational companies � the rise of trade blocs in the Europe and North

America � the rapid dissemination of global lifestyles

…income…income…income…income…prices…prices…prices…prices…savings…savings…savings…savings…debt, and…debt, and…debt, and…debt, and…credit …credit …credit …credit availabilityavailabilityavailabilityavailability

� Mass marketing

� Customized marketing

� Market Segmentation

A market segment A market segment A market segment A market segment consists of a large identifiable group consists of a large identifiable group consists of a large identifiable group consists of a large identifiable group

within within within within a market a market a market a market with similar wants, purchasing power, with similar wants, purchasing power, with similar wants, purchasing power, with similar wants, purchasing power, with similar wants, purchasing power, with similar wants, purchasing power, with similar wants, purchasing power, with similar wants, purchasing power, geographical location, buying attitudes, geographical location, buying attitudes, geographical location, buying attitudes, geographical location, buying attitudes, or buying habits.or buying habits.or buying habits.or buying habits.

� to find the best customers for a to find the best customers for a to find the best customers for a to find the best customers for a particular company particular company particular company particular company

� to help that company tailor its to help that company tailor its to help that company tailor its to help that company tailor its operations to those particular operations to those particular operations to those particular operations to those particular operations to those particular operations to those particular operations to those particular operations to those particular customers. customers. customers. customers.

� Survey StageSurvey StageSurvey StageSurvey Stage: go out and learn something about your market.

What do its members like and dislike?

What’s important to them?

Who are they?

Where do they come from?Where do they come from?

� Analysis StageAnalysis StageAnalysis StageAnalysis Stage: process your data, getting rid of statistical irregularities and focusing on the most significant clusters of potential customers.

� Profiling Profiling Profiling Profiling StageStageStageStage:come up with a description of each cluster, a profile that will help you think about how to market to that particular group.

� demographic demographic demographic demographic variables like age, gender, and family size.

� psychographic psychographic psychographic psychographic categories like lifestyle, personality, and values.

� behavior:behavior:behavior:behavior: potential customers’ knowledge of, attitude toward, use of, or response to your product.

FOR BUSINESS PRODUCTS ?FOR BUSINESS PRODUCTS ?FOR BUSINESS PRODUCTS ?FOR BUSINESS PRODUCTS ?geographygeographygeographygeography

benefits sought or benefits sought or benefits sought or benefits sought or

usage rate.usage rate.usage rate.usage rate.

� Measurable: able to measure the size, purchasing power, and characteristics of the segment. Otherwise, you won’t be able to compare it effectively to other segments.

� Substantial: have enough members and enough buying

power to justify targeting it.

� Accessible: able to get your message and your product to the segment. Accessible: segment.

� Differentiable: made up of people who respond in a unique way to particular marketing-mix elements and programs. If two groups respond the same way to a television commercial, they do not constitute two different segments.

� Actionable: able to devise an effective marketing strategy on the basis of the segment.

� Sales information systemsSales information systemsSales information systemsSales information systems,…� …provide current sales data. Marketers need tools

to keep up with the increased pace of company operations. And a number of companies have responded to this need, offering products that provide up-to-the-minute information about

customers and sales.

� Marketing Decision Support System…Marketing Decision Support System…Marketing Decision Support System…Marketing Decision Support System…� Marketing Decision Support System…Marketing Decision Support System…Marketing Decision Support System…Marketing Decision Support System…� …a coordinated collection of data, systems, tools, and techniques with supporting hardware and software by which an organization gathers and interprets relevant

information from business and environment and turns it into a basis for marketing action.

� “… the systematic and � objective identification, collection, analysis, dissemination, and use of information

� for the purpose of improving decision � for the purpose of improving decision making related to the identification and solution of problems and opportunities in marketing.”

� Problem definitionProblem definitionProblem definitionProblem definition

� Development of an approach to the Development of an approach to the Development of an approach to the Development of an approach to the problemproblemproblemproblem

� Research design formulationResearch design formulationResearch design formulationResearch design formulation� Research design formulationResearch design formulationResearch design formulationResearch design formulation

� Fieldwork or data collectionFieldwork or data collectionFieldwork or data collectionFieldwork or data collection

� Data preparation and analysisData preparation and analysisData preparation and analysisData preparation and analysis

� Report preparation and analysisReport preparation and analysisReport preparation and analysisReport preparation and analysis

� Market demand…Market demand…Market demand…Market demand…

…the total volume that would be bought by a …the total volume that would be bought by a …the total volume that would be bought by a …the total volume that would be bought by a defined customerdefined customerdefined customerdefined customer group in a group in a group in a group in a defined geographical areadefined geographical areadefined geographical areadefined geographical area in a in a in a in a defined time perioddefined time perioddefined time perioddefined time period in a in a in a in a defined marketing defined marketing defined marketing defined marketing environment environment environment environment under a under a under a under a defined marketing programdefined marketing programdefined marketing programdefined marketing program....

� Market forecast..Market forecast..Market forecast..Market forecast..

…The level of demand that actually occurs under a given level of industry …The level of demand that actually occurs under a given level of industry …The level of demand that actually occurs under a given level of industry …The level of demand that actually occurs under a given level of industry marketing expenditure is the market forecast.marketing expenditure is the market forecast.marketing expenditure is the market forecast.marketing expenditure is the market forecast.marketing expenditure is the market forecast.marketing expenditure is the market forecast.marketing expenditure is the market forecast.marketing expenditure is the market forecast.

� Market potential…Market potential…Market potential…Market potential…

…the limit approached by market demand as industry marketing expenditure …the limit approached by market demand as industry marketing expenditure …the limit approached by market demand as industry marketing expenditure …the limit approached by market demand as industry marketing expenditure approaches infinity.approaches infinity.approaches infinity.approaches infinity.

� Company demand…Company demand…Company demand…Company demand…

…the company’s estimated share of market demand at alternative levels of …the company’s estimated share of market demand at alternative levels of …the company’s estimated share of market demand at alternative levels of …the company’s estimated share of market demand at alternative levels of company marketing effort in a given time.company marketing effort in a given time.company marketing effort in a given time.company marketing effort in a given time.

� Company sales potentialCompany sales potentialCompany sales potentialCompany sales potential� Company sales potential is the sales limit approached by company demand as company marketing efforts increase

relative to competitors.

� Total market potential =Total market potential =Total market potential =Total market potential =

� number of buyersnumber of buyersnumber of buyersnumber of buyers x x x x items purchased per buyeritems purchased per buyeritems purchased per buyeritems purchased per buyer x x x x cost per cost per cost per cost per itemitemitemitem

� Business missionBusiness missionBusiness missionBusiness mission …a clearly stated statement that will ultimately focus on the activities that the company wants to achieve in future.

� SWOT analysis…SWOT analysis…SWOT analysis…SWOT analysis…strengths, weaknesses, opportunities and threats

� MacroMacroMacroMacro----environment…environment…environment…environment… the larger world in which the company operates. operates.

� MicroMicroMicroMicro----environment…environment…environment…environment… immediate environment of your business: customers, competitors, distributors, and suppliers.

� Goal formulation… Goal formulation… Goal formulation… Goal formulation… SMART

� Strategy formulation… Strategy formulation… Strategy formulation… Strategy formulation… strategy is a game plan for getting there.

� Program formulationProgram formulationProgram formulationProgram formulation

� ImplementationImplementationImplementationImplementation

� Feedback and controlFeedback and controlFeedback and controlFeedback and control

� …analyzing market opportunities…developing marketing strategies

� … planning marketing programs� … planning marketing programs

� … managing the marketing efforts & …ensuring proper feedback.

� Executive SummaryExecutive SummaryExecutive SummaryExecutive Summary� Table of ContentsTable of ContentsTable of ContentsTable of Contents� Current Marketing SituationsCurrent Marketing SituationsCurrent Marketing SituationsCurrent Marketing Situations

Opportunity and Issue AnalysisOpportunity and Issue AnalysisOpportunity and Issue AnalysisOpportunity and Issue Analysis� Opportunity and Issue AnalysisOpportunity and Issue AnalysisOpportunity and Issue AnalysisOpportunity and Issue Analysis� ObjectivesObjectivesObjectivesObjectives� Marketing StrategyMarketing StrategyMarketing StrategyMarketing Strategy� Action ProgramsAction ProgramsAction ProgramsAction Programs� Projected Profit and Loss Statement.Projected Profit and Loss Statement.Projected Profit and Loss Statement.Projected Profit and Loss Statement.

� Arranged hierarchically from most important to least Arranged hierarchically from most important to least Arranged hierarchically from most important to least Arranged hierarchically from most important to least importantimportantimportantimportant. You need to know what matter most to your company and assign your resources accordingly.

� Stated quantitatively whenever possibleStated quantitatively whenever possibleStated quantitatively whenever possibleStated quantitatively whenever possible. You want to be able to measure your progress. It’s a lot easier to do this if your goal is to increase sales by a specific amount, than it is if your goal is simply to increase sales. amount, than it is if your goal is simply to increase sales.

� RealisticRealisticRealisticRealistic. Why set a goal you can’t achieve? Goal formulation is the basis of the concrete actions your company will take in the future. Unrealistic goals lead to irrational plans.

� ConsistentConsistentConsistentConsistent. Your company will have a number of goals, but they must be compatible. You can’t run in opposite directions at the same time.

Cultural factors: Culture, Sub-culture, Social class

� Reference groups

� Family

Role

& Status& Status

�Age…stage in the life cycle

�Occupation…economic

circumstances

Personality and self �Personality and self concept

�Lifestyle and values

MotivationMotivationMotivationMotivation…………Freud’s Theory people’s behavior are largely unconscious

Maslow’s Theory human needs are arranged Maslow’s Theory human needs are arranged in a hierarchy, from the most urgent to the

least urgent

Herzberg’s Theory people are motivated to act when there are no dissatisfiers associated with an action while at the same time there are sufficient satisfiers present

�PerceptionPerceptionPerceptionPerception… converting any stimulus in

your own psychology

�LearningLearningLearningLearning… experience, ideas, guidance

�Beliefs and attitudesBeliefs and attitudesBeliefs and attitudesBeliefs and attitudes…person's �Beliefs and attitudesBeliefs and attitudesBeliefs and attitudesBeliefs and attitudes…person's

enduring favorable or unfavorable evaluations, emotional feelings, and action tendencies toward

some object or idea

� Your mother (the initiator) suggests that you might think about buying your father a new dress for his birthday.

� You ask your sister (the influencer) what she thinks. She thinks it's a good idea.

� You (the decider) agree and decide to buy an expensive dress from a renowned store.

� However, you don't have time to go to the store, so you send your brother (the buyer) to make the actual purchase.

� Your father (the user) loves the new dress and use it regularly.

Nature of Business buying decisionsNature of Business buying decisionsNature of Business buying decisionsNature of Business buying decisions…

Business Buying Process…

� New task… buying for the first time

� Straight rebuy… reorder or rescheduling without modification

� Modified rebuy… reorder with modifications like price, volume, supply routine etc.

Influencing factors on Business Buying Decisions

� InitiatorsInitiatorsInitiatorsInitiators. Those who request that something be purchased. They may be users or other people in the organization.

� UsersUsersUsersUsers. Those who will use the product or service. In many cases, the users initiate the buying proposal and help define the product requirements.

� InfluencersInfluencersInfluencersInfluencers. People who influence the buying decision. They often help define specifications and also provide information for evaluating alternatives. Technical personnel are particularly important influencers.

� DecidersDecidersDecidersDeciders. People who decide on product requirements and/or � DecidersDecidersDecidersDeciders. People who decide on product requirements and/or on suppliers.

� ApproversApproversApproversApprovers. People who have formal authority to select the supplier and arrange the purchase terms.

� BuyersBuyersBuyersBuyers. People who have formal authority to select the supplier and arrange the purchase terms.

� GatekeepersGatekeepersGatekeepersGatekeepers. People who have the power to prevent sellers or information from reaching members of the buying center. For example, purchasing agents, receptionists, and telephone operators may prevent salespersons from contacting users or deciders.