pre-ph.d. notes for marketing

8/3/2019 Pre-ph.d. Notes for Marketing

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MARKETING PROCESS

1.Analysing marketing opportunities

2.Selecting target markets

3.Developing marketing mix

4.Managing the marketing effort


1.Marekting Information System

2.Marketing Research System

3.Marketing environment PEST

2.Selecting target markets

1.Segmentation

2.Target Marketing

3.Positioning

3.Developing marketing mix

1.Product

Line,mix,depth,consistency

Branding, Brand Extension


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Packaging

New Product development process

Product life cycle

2.Price

3.Place

4.Promotion mix- AD,SP,PS,PR,DR


1.Markeing Organisation

2.Marketing Control

1.Annual Plan control

2.Efficienty control

3.Profitability control

4.Strategic control

BRANDING


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A BRAND IS A NAME,TERM, SIGN, SYMBOL, DESIGN OR A COMBINATION OF THEM INTENDED TOIDENTIFY THE GOODS OR SERVICES OF ONE SELLER OR GROUP OF SELLERS AND TODIFFERENTIATE THEM FROM THOSE OF COMPETITORS.

WORLDS MOST 10 VALUABLE BRANDS

COCO-COLA MARLBORO IBM MCDONALDSDISNEY SONY KODAK INTELGILLETTE BUDEWISER

BRAND-IS THAT PART OF THE BRAND THAT CAN BE VOCALISED-BUSH,ANACIN,COLGATE,

A BRAND MARK IS THAT PART WHICH CAN BE SEEN BUT IS NOT UTTERABLE.

(FEVICOL,CAMLIN,ASIAN PAINTS,BOMBAY DYEING)

A TRADE MARK IS A LEGALLY PROTECTED BRAND

CHARACTERISTICS OF GOOD BRAND NAME

1.IT SHOULD BE EASY TO PRONOUNCE, RECOGNISE AND REMEMBER

2.IT SHOULD BE ASSOCIATED WITH AN ATTRACTIVE PICTURE OR IMAGE, SO THAT IT GETS

RECORDED IN THE HUMAN MIND AND WILL FACILITATE RECALL.

3.IT SHOULD SUGGEST SOMETHING ABOUT THE PRODUCT LIKE ACTION, COLOUR, TYPE , ORTHE BENEFITS DERIVED IN USING THE PRODUCT.

E.G., STOPACHE,QUICKFIX,DUROPLY,BAND-AID, GROMOR,SRINGAR ETC.,

4.IT SHOULD GIVE THE RIGHT CONNOTATION TO THE BUYER. (KOOLAIR , SUNFLAME)

5.IT SHOULD NOT CARRY POOR MEANINGS IN OTHER COUNTRIES AND LANGUAGES

SEARCHING FOR BRAND NAMES - METHODS

1.ASSOCIATION TESTS: WHAT IMAGES COME INTO MIND


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2.MEMORY TESTS- HOW WELL IS THE NAME REMEMBERED

3.PREFERENCE TESTS-WHICH NAMES ARE PREFERRED

BRAND EXTENSION/LINE EXTENSION

BRAND EXTENSIONS- A COMPANY MAY USE ITS EXISTING BRAND NAME TO LAUNCH NEWPRODUCTS IN OTHER CATEGORIES.

LINE EXTENSIONS - CONSIST OF INTRODUCING ADDITIONAL ITEMS IN THE SAME BRAND NAME

SUCH AS NEW FLAVOURS, FORMS , COLOURS, ADDED INGREDIENTS, PACKAGE SIZES,

ADVANTAGES OF THESE EXTENSIONS1.ESTABLISHES THE PRODUCTS QUALITY

2.MUCH HIGHER CHANCE OF SURVIVAL THAN NEW BRAND LAUNCHES

3.SAVING HUGE NEW BRAND LAUNCHING EXPENSES

DISADVANTAGES OF THESE EXTENSIONS

1.BRAND NAME LOSING SPECIFIC MEANING

2.MIGHT DAMAGE RESPECT FOR ORIGINAL PRODUCT

3. MAY BE INAPPROPRIATE TO THE NEW PRODUCT

4.BRAND MAY LOSE ITS SPECIAL POSITIONING IN THE

CONSUMERS MIND THROUGH OVEREXTENSION

5.BRAND CANNIBALISATION.


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BRAND NAMES WHICH HAVE BECOME GENERIC NAMESEXAMPLES

NYLON, VASELINE, FIBREGLASS, THERMOS, ASPIRIN,KEROSINE, LINOLEUM, CELLOPHANE,ESCALATOR, ZIPPER,JEEP ETC.,DECOLAM, DALDA.XEROX,

CHOICES IN SELECTION OF A GOOD BRAND NAME1.INITIALS/ACRONYMNS :

2.INDIVIDUAL NAMES WITH NUMBERS:VICKS ACTION-500, TIK-20,

3.PERSONAL/FAMILY OR FOUNDER NAME:JOHN BOYD DUNLOP

4.GEIOGRAPHICAL/HISTORICAL NAMES;

5.PART OF COMPANYS NAME-

6.COMBINATION OF TWO WORDS- FAIR & LOVELYTIPS&TOES,

7.ANIMALS- KINGFISHER,TORTOISE

TOP INDIAN BRANDS

COLGATE BATA PONDS DETTOL BRITANNIA

PHILIPS VICKS IODEX RIN GODREJ

TATA LIFEBUOY DALDASURF HORLICKS

AMUL ARIEL LUX NIRMA REYNOLDS

MRF TITAN ANACIN VIP EVEREADY

J&J BAJAJ PARLE BAND-AID WHIRLPOOL


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COCA-COLA BPL VIM GLAXOCOMPLAN

DABUR CINTHOL ATLAS TOPAZ THUMS-UP

SONY RASNALIRIL PEPSI SUNLIGHT

HERO TVS CERELAC MAGGI RED LABEL

DHARA KWALITY BATA DETTOL CADBURYS

HAWKINS HORLICKS DUNLOP PONDSPAARACHUTE

USHA MAGGI LAKMENESCAFE THUMS-UP

ROBIN BLUE BURNOL KORES HMT ANCHOR

BRANDING

A BRAND IS A NAME,TERM, SIGN, SYMBOL, DESIGN OR A COMBINATION OF THEM INTENDED TO

IDENTIFY THE GOODS OR SERVICES OF ONE SELLER OR GROUP OF SELLERS AND TO

DIFFERENTIATE THEM FROM THOSE OF COMPETITORS.

WORLDS MOST 10 VALUABLE BRANDS

COCO-COLA MARLBORO IBM MCDONALD SDISNEY SONY

KODAK INTEL GILLETTE BUDEWISER


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TOP INDIAN BRANDS

COLGATE BATA PONDS DETTOL BRITANNIA

PHILIPS VICKS IODEX RIN GODREJ

TATA LIFEBUOY DALDASURF HORLICKS

AMUL ARIEL LUX NIRMA REYNOLDS

MRF TITAN ANACIN VIP EVEREADY

J&J BAJAJ PARLE BAND-AID WHIRLPOOL

COCA-COLA BPL VIM GLAXOCOMPLAN

DABUR CINTHOL ATLAS TOPAZ THUMS-UP

SONY RASNALIRIL PEPSI SUNLIGHT

HERO TVS CERELAC MAGGI RED LABEL

DHARA KWALITY BATA DETTOL CADBURYS

HAWKINS HORLICKS DUNLOP PONDSPAARACHUTE

USHA MAGGI LAKMENESCAFE THUMS-UP

ROBIN BLUE BURNOL KORES HMT ANCHOR

BRAND-IS THAT PART OF THE BRAND THAT CAN BE VOCALISED-BUSH,ANACIN,COLGATE,

A BRAND MARK IS THAT PART WHICH CAN BE SEEN BUT IS NOT UTTERABLE.

(FEVICOL,CAMLIN,ASIAN PAINTS,BOMBAY DYEING)

A TRADE MARK IS A LEGALLY PROTECTED BRAND

CHARACTERISTICS OF GOOD BRAND NAME

1.IT SHOULD BE EASY TO PRONOUNCE, RECOGNISE AND REMEMBER

2.IT SHOULD BE ASSOCIATED WITH AN ATTRACTIVE PICTURE OR IMAGE, SO THAT IT

GETS RECORDED IN THE HUMAN MIND AND WILL FACILITATE RECALL.


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3.IT SHOULD SUGGEST SOMETHING ABOUT THE PRODUCT LIKE ACTION, COLOUR,

TYPE , OR THE BENEFITS DERIVED IN USING THE PRODUCT.

E.G., STOPACHE,QUICKFIX,DUROPLY,BAND-AID, GROMOR,SRINGAR ETC.,

4.IT SHOULD GIVE THE RIGHT CONNOTATION TO THE BUYER. (KOOLAIR , SUNFLAME)

5.IT SHOULD NOT CARRY POOR MEANINGS IN OTHER COUNTRIES AND LANGUAGES

BRAND EXTENSION/LINE EXTENSION

BRAND EXTENSIONS- A COMPANY MAY USE ITS EXISTING BRAND NAME TO LAUNCH NEW

PRODUCTS IN OTHER CATEGORIES.

LINE EXTENSIONS - CONSIST OF INTRODUCING ADDITIONAL ITEMS IN THE SAME

BRAND NAME SUCH AS NEW FLAVOURS, FORMS , COLOURS, ADDED INGREDIENTS,

PACKAGE SIZES,

ADVANTAGES OF THESE EXTENSIONS

1.ESTABLISHES THE PRODUCTS QUALITY

2.MUCH HIGHER CHANCE OF SURVIVAL THAN NEW BRAND LAUNCHES

3.SAVING HUGE NEW BRAND LAUNCHING EXPENSES

DISADVANTAGES OF THESE EXTENSIONS

1.BRAND NAME LOSING SPECIFIC MEANING

2.MIGHT DAMAGE RESPECT FOR ORIGINAL PRODUCT

3. MAY BE INAPPROPRIATE TO THE NEW PRODUCT


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4.BRAND MAY LOSE ITS SPECIAL POSITIONING IN THE

CONSUMERS MIND THROUGH OVEREXTENSION

5.BRAND CANNIBALISATION.

BRAND NAMES WHICH HAVE BECOME GENERIC NAMES

EXAMPLES

NYLON, VASELINE, FIBREGLASS, THERMOS, ASPIRIN,KEROSINE, LINOLEUM, CELLOPHANE,

ESCALATOR, ZIPPER,JEEP ETC.,DECOLAM, DALDA.XEROX,

CHOICES IN SELECTION OF A GOOD BRAND NAME

1.INITIALS/ACRONYMNS :

2.INDIVIDUAL NAMES WITH NUMBERS:VICKS ACTION-500, TIK-20,

3.PERSONAL/FAMILY OR FOUNDER NAME:JOHN BOYD DUNLOP

4.GEIOGRAPHICAL/HISTORICAL NAMES;

5.PART OF COMPANYS NAME-

6.COMBINATION OF TWO WORDS- FAIR & LOVELY

TIPS&TOES,

7.ANIMALS- KINGFISHER,TORTOISE

Brand equity The value of a brand, based n the extent to which it has high brand loyalty, name awareness,perceived quality, strong brand associations, and other asses such as patents, trademarks, and channel

relationships.

COMMUNICATION & CONSUMER

BEHAVIOUR


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TYPES OF COMMUNICATION

INTERPERSONAL COMMUNICATION

COMMUNICATION THAT OCCURS ON APERSONAL LEVEL BETWEEN TWO OR

MORE PEOPLE.

FORMAL INTERPERSONAL

COMMUNICATION IS THE KIND OFCOMMUNICATION THAT TAKES PLACE

BETWEEN A SALESPERSON AND A

PROSPECT, IN WHICH THE

SALESPERSON SERVES AS THE

SENDER AND THE PROSPECT THE

RECEIVER OF THE PRODUCTINFORMATION.


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FACE TO FACE COMMUNICATION CAN

BE BOTH VERBAL AND NONVERBAL.

SOME FACIAL AND BODILY

MOVEMENTS

SIMPLE SMILE

BROAD SMILE

COMPRESSED SMILE

GRIN

UPPER LIP OUT

LOWER LIP OUT

BIT LIPS

COMPRESSED LIPS

OPEN MOUTH

CHEW

GRIND TEETH

TONGUE BETWEEN LIPS


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TONGUE OUT

BLINK

CLOSE EYES

WINK STARE WIDEN EY4ES

LOOK DOWN

LOOK AROUND

BLUSH

SHRUG

SCRATCH

ADJUST CLOTHING

COVER EYESFINGERS ON FACE

STROKE CHIN STROKE MUSTACHE

STROKE BEARD

TWIST HAIRS

CLAP

HANDS CLASPED


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HANDS FOLDED

IMPERSONAL COMMUNICATION OR

MASS COMMUNICTION

COMMUNICATION DIRECTED TO A

LARGE AND DIFFUSE AUDIENCE.

IMPERSONAL COMMUNICATION IS

CARRIED BY SUCH MASS MEDIA

CHANNELS AS TELEVISION, RADIO,

NEWSPAPERS, MAGAZINES ETC.,

NOT ALL MASS COMMUNICATIONS

HAVE COMMERCIAL OBJECTIVES


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DEVELOPING EFFECTIVE

COMMUNICATIONS STEPS

1.IDENTIFY THE TARGET AUDIENCE-

IMAGE ANALYSIS, FAMILIARITY,

FAVOURABILTY ANALYSIS

2.DETERMINE THE COMMUNICATION

OBJECTIVES COGNITIVE, AFFECTIVEOR BEHAVIORAL

COGNITIVE- PUT SOMETHING IN

CONSUMERS MIND

AFFECTIVE CHANGE AN ATTITUDE

BEHAVIORAL - GET THE CONSUMER

TO ACT

3.DESIGN THE MESSAGE

4.SELECT THE COMMUNICATION

CHANNELS

5.BUDGET

6.DECIDE ON THE COMMUNICATIONS

MIX


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7.MEAUSRE RESULTS

8.MANGE THE INTEGRATED

COMMUNICATION PROCESS

BARRIERS TO COMMUNICATION AND

CONSUMER BEHAVIOUR

SELECTIVE EXPOSURE AND SELECTIVE

PERCEPTION

BALANCE THEORY - POSTULATES

THAT INDIVIDUALS SEEK

INFORMATION THAT IS CONSISTENT

WITH THEIR NEEDS, INTERESTS, AND

ATTITUDES AND AVOID INFORMATIONTHAT IS NOT.


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PREPARED FOR MBA (DAY) IV

SEMESTER 2001

PSYCHOLOGICAL NOISE- DISTRACTING

THOUGHTS, ADCLUTTER,

DAYDREAMING

REDUNDANCY IS CONSTANTLY

PRACTICED BY MARKETERS WHO

REPAT THE SAME ADVERTISEMENTS

OVER AND OVER IN THE SAME

MEDIUM.(DIFFERENT TYPES OF

ADVERTISEMENTS)

REPEATED EXPOSURE TO AN

ADVERTISING MESSAGE HELPS

SURMOUNT PSYCHOLOIGICAL

BARRIERS TO MESSAGE RECEPTION.

ROADBLOCKING - TO ENSURE

VIEWING OF THEIR COMMERCIALS


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DESPITE FREQUENT CHANNEL

SWITCHING DURING COMMERCIALS ,

SOME ADVERTISERS BROADCAST THE

SAME COMMERCIALS

SIMULTANEOUSLY IN EACH

NETWORK.

OVERLAPPING AUDIENCES - SINCE

MANY MEDIA - ESPECIALLY THOSE

WITH SIMILAR EDITORIAL FEATURES

AND FORMATS HAVE OVERLAPPING

AUDIENCES, ADVERTISERS USUALLY

PLACE THEIR ADVERTING MESSAGES

SIMULTANEOUSLY OR SEQUENTIAL INA NUMBER OF MEDIA WITH SIMILAR

AUDIENCE PROFILES.

COMMUNICATION TECHNIQUES TO

MAKE A MESSAGE MEMORABLE

1.GET THE AUDIENCE AROUSED


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2.GIVE THE AUDIENCE A REASON FOR

LISTENING

3.USE QUESTIONS TO GENERATEINVOLVEMENT

4.CAST THE MESSAGE IN TERMS

FAMILIAR TO YOUR AUDIENCE

5.TIE MATERIAL BY A THEME AND

PRESENT IN A LOGICAL MANNER6.REPEAT KEY POINTS

7.USE RHYTHM AND RHYME

8.ASK YOUR AUDIENCE FOR A

CONCLUSION

ONE SIDED VERSUS TWO SIDED

MESSAGES

TELLING AUDIENCE ONLY THE GOOD

POINTS ABOUT THEIR PRODUCTS

TWO-SIDETELLING THE AUDIENCE THE BAD

POINTS ABOUT THEIR PRODUCTS


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A PRACTICAL ILLUSTRATION OF TWO-

SIDED ADVERTING IS COMPARATIVE

ADVERTISING. - ADVERTISING THAT

EXPLICITLY NAMES OR IDENTIFIES

ONE OR MORE COMPETITORS OF THE

ADVERTISED BRAND FOR THE

PURPOSE OF CLAIMING SUPERIORITY.

ORDER EFFECTS

ON TV THE COMMERCIALS SHOWN

FIRST ARE RECALLED BEST, THOSE IN

THE MIDDLE THE LEAST AND ONES AT

THE END SLIGHTLY BETTER THAN

THOSE IN THE MIDDLE.

THE MEDIA RECOGNIZE THE IMPACT

OF ORDER EFFECTS BY ASSIGNING

"PREFERRED POSITION" PLACEMENT

TO FRONT, BACK, AND INSIDE

COVERS OF MAGAZINES,

HUMOUR IN ADVERTISING


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1.HUMOUR HEIGHTENS AWARENESS

OF AND BRINGS ATTENTION THECOMMERCIAL.

2.HUMOROUS COMMERCIALS HAVE A

SHORT LIFE SPAN.

3.HUMOUR SHOULD NOT BE USED

FOR SENSITIVE GOODS AND SERVICESLIKE MONEY, SAFETY

SEX IN ADVERTISING

THERE ARE FEW APPEALS IN

ADVERTISING THAT EQUAL THE

ATTENTION GETTING VALUE AS SEX .

SEXUALLY ORIENTED ADS COULD BEUSED AS

1.ATTENTION GETTING DEVICE


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2.TO DISPLAY THE FUNCTION OF THE

PRODUCT

3.AS FANTASY IMAGES4.SYMBOLICALLY -

MEN AND WOMEN RESPOND

DIFFERENTLY TO SEX IN

ADVERTISING. FOR EXAMPLE,

PERCEPTIONS AMONG MEN OF AN

AD'S SEXINESS DEPEND ON THE

EXTENT OF NUDITY PORTRAYED. FOR

WOMEN, ROMANTIC CONTENT IS THEPRIMARY DETERMINANT OF WHETHER

AND AD IS "SEXY".


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CULTURAL, SUBCULTURAL AND CROSS-CULTURAL ASPECTS OF CONSUMERBEHAVIOUR

Culture is the sum total of learned beliefs, values and customs that serve to

direct the consumer behaviour of members of a particular society.

Given the broad and pervasive nature of culture, its study generally requires a

global examination of the character of the total society, including such factors as

languages, knowledge laws, religions, food customs, music, art, technology, work

patterns, products, and other artificats that give the society its distinctive flavour. In a

sense, culture is a societys personality. For this reason, it is not easy to define its

boundaries.

The belief and value components of our definition refer to the accumulated

feelings and priorities that individuals have about things. More precisely, beliefsconsist of the very large number of mental or verbal statements (i.e., I believe) that

reflect a persons particular knowledge and assessment of something (another person,

a store, product, a brand). Values are also beliefs. However, values differ from other

beliefs in that they meet the following criteria:


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1. they are relatively few in number,2. they serve as a guide for culturally appropriate behaviour,3. they are enduring or difficult to change,4. they are not tied to specific objects or situations.5. they are widely accepted by the members of a society.

Therefore, in a broad sense, both values and beliefs are mental images

that affect a wide range of specific attitudes, which in turn influence the

way a person is likely to respond in a specific situation. In contrast to

beliefs and values, customs and overt modes of behaviour that constitute

culturally approved.or acceptable ways of behaving in specific situations.

Customs consist of everyday or routine behaviour. Thus, while beliefs and

values are guides for behaviour, customs are usual and acceptable ways

of behaving.

The Invisible Hand of Culture:

The impact of culture is so natural and so automatic that its influence on

behaviour is usually taken for granted. A true appreciation of the influence culture has

on our daily life requires some knowledge of atleast one other society with difference

cultural characteristics.

Culture Satisfies Needs:

Culture exists to satisfy the needs of the people within a society. It offers order,

direction, and guidance in all phases of human problem solving by providing tried andtrue methods of satisfying physiological, personal, and social needs.

In a cultural context, a firms products and services can be viewed as

offering appropriate or acceptable solutions for individual or societal needs. If a product

is no longer acceptable because a value or custom that is related to its use does not


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adequately satisfy human needs, then the firm producing it must be ready to revise its

product offering. Marketers must also be alert to newly embraced customs and values.

Culture is Learned:

Unlike innate biological characteristics (eg., sex, skin, hair colour, intelligence),

culture is learned. At an early age we begin to acquire from our social environment a set

of beliefs, values and customs that constitute our culture.

How Culture is Learned Anthropologists have identified three distinct forms of

cultural learning: formal learning, in which adults and older siblings teach a young family

member how to behave, Informal learning, in which a child learns primarily by imitating

the behaviour of selected others (family, friends, TV heroes), and technical learning, in

which teachers instruct the child in an educational environment as to what should be

done, how it should be done, and why it should be done.

Encujturation and Acculturation:

In discussing the acquisition of culture, anthropologists often distinguish between

the learning of ones own, or native, culture and the learning of some other culture. Thelearning of ones own culture is known as Enculturation, the learning of a new or foreign

culture is known as acculturation;

Culture is Shared:

To be considered a cultural characteristic, a particular belief, value or practice

must be shared by a significant portion of the society. Accordingly, culture is frequently

viewed as group customs that link together the members of a society.

Various social institutions within a society transmit the elements of culture and

make the sharing of culture a reality. Chief among such institutions if the family, which

serves as the primary agent for enculturation the passing along of basic cultural


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beliefs, values, and customs to societys newest members. A vital part of the

enculturation role of the family is the consumer socializations of the young.

In addition to the family, educational institutions also shares the responsibility for

the transfer of selected aspects of culture. Educational institutions are specifically

charged with imparting basic learning skills, history, patriotism, citizenship, and the

technical training needed to prepare people for significant roles within society. Another

social institution that plays a major role in the transfer of culture throughout society is the

mass media.

Culture is Dynamic:

Many factors are likely to produce cultural changes within a given society (new

technology, population shifts, resource shortages, wars, changing values, customs

borrowed from other cultures). For this reason, the marketer must carefully monitor the

socio cultural environment in order to market an existing product more effectively, or to

develop promising new products.

THE MEASUREMENT OF CULTURE;

A wide range of measurement techniques are employed in the study of culture.

For example, the projective tests used by psychologists to study motivation and

personality and the attitude measurement techniques used by social psychologists and

sociologists, are relatively popular tools in the study of culture.

In addition, content analysis, consumer field work, and value measurement

instruments are three research approaches that are frequently associated with the

examination of culture and the spotting of cultural insights and trends.

Content Analysis:

Conclusions about a society, or specific aspects of a society, can sometimes be

drawn from an examination of the content of its messages. Content analysis, as the


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name implies, focuses on the content of verbal, written, and pictorial communications

(eg., the copy and art composition of an ad.)

Content analysis can be used as a relatively objective means for determing

whether social and cultural changes have occurred in a specific society.

SUB CULTURE

A subculture can be thought of as a distinct cultural group that exists as an

identifiable segement within a larger, more complex society. The members of a specific

subculture tend to possess beliefs, values, and customs that set them apart from other

members of the same society. In addition, they adhere to most of the dominant cultural

beliefs, values and behavioural patterns of the larger society.

Thus the cultural profile of a society or nation can be viewed as a composite of

two distinct elements: (1) the unique benefits, values and customs subscribed to by

members of specific subcultures; and (2) the central or core cultural themes that are

shared by most of the population, regardless of specific subcultural memberships.

Subcultural analysis enables the marketing manager to focus on rather large and

natural market segments. In carrying out such analysis, however, the marketer must

determine whether the beliefs, values and customs shared by members of a specific

subgroup make them desirable candidates for special marketing attention. Subcultures

are therefore relevant units of analysis for market research.

SUBCULTURAL CATEGORIES;


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1. Nationality subculture2. Religion subculture3. Regional subculture4. Age subculture

5. Sex subculture

NATIONALITY SUBCULTURES;

While most Indian citizens, see themselves as Indian they frequently retain a

sense of identification and pride in the language and customs of their ancestors.

When it comes to consumer behaviour, this ancestral pride is manifested moststrongly in the consumption of ethnic foods, in travel to the homeland, and in the

purchase of numerous cultural artifacts (ethnic clothing, art, music.

RELIGIOUS SUBCULTURES;

Difference religious groups flourish in

any country. The members of all thesereligious groups are at times likely tomake purchase decisions that areinfluenced by their religious identity.Nevertheless, consumer behaviour isdirectly affected by religion in terms of

products that are symbolically andritualistically associated with thecelebration of various religious holidays.Though marketers are often reluctant toreach religious subcultures through


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religious publications, advertising inreligious media can be rewarding. Verylittle consumer research has been devoted

to examining how religious affiliation andcommitment influences consumerpreferences and loyalties.GEOGRAPHIC SUBCULTURES;

India is a large country, one that enjoys a wide range of climatic and geographic

conditions. Given the countrys size and physical diversity, it is only natural that the

Indian people have a sense of regional identification and use this identification as a wayof describing others. Such labels often assist us in developing a mental picture a

stereotype of the person in question.

In India there are many regional differences in consumption behaviour. For

example, coffee drinking is more in the South.

AGE SUBCULTURES:

All major age subgroupings of the population might broadly be thought of as

separate subcultures. Within the context of the family life cycle. Each stage of the life

cycle (bachelorhood, honeymooners, parenthood, postparenthood, and dissolution)

could be considered a separate subculture, since important shifts occur in the demand

for specific types of products and services.

SEX SUBCULTURE;

All known societies assign certaintraits and roles to males and others tofemales, for instance, aggressiveness,


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competitiveness, independence, and selfconfidence were long considered to betraditional masculine traits, neatness,

tactfulness, gentleness, and talkativenesswee considered to be traditional femininetraits. In terms of role differences,women have historically been cast ashomemakers with responsibility for childcare, and men as the providers or

breadwinners. Many advertisers appeal tosuch sex-linked roles, and consumertastes are frequently influenced by sex-role factors.

THE WORKING WOMAN:

Marketers and consumer researchershave been increasingly interested in theworking women, especially the marriedworking woman. They recognize thatworking wives are a large and growingmarket segment whose needs differ from

those of women who do not work outsidethe homes.

CROSS CULTURE


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To determine whether and how to enter a foreign market, marketers should

conduct cross-cultural consumer analysis is defined as the effort to determine to what

extent the consumer of two or more nations are similar or difference. Such an analysis

can provide marketers with an understanding of the differences in psychological, social,

cultural, and environmental characteristics so as to permit the design of effective

marketing strategies for each of the specific countries involved.

Today many companies almost all major corporations sell their products

throughout the world. Infact, the issue is generally not whether to sell a brand in other

countries, but how to do it (i.e., one product, one global advertising campaign worldwide,

or tailored products and localized ads for each country).

FACTORS:

1. Language differences2. Differences in consumption patterns3. Differences in potential market segments4. Differences in the way that products or services are used5. Differences in the criteria for evaluating products and services6. Differences in economic and social conditions7. Differences in marketing research opportunities.


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(OU Campus)-For private circulation only

DECISION AREAS IN ADVERTISING

Advertising is any paid form of nonpersonal presentation and promotion of ideas,goods or services by an identified sponsor.

STEPS IN DEVELOPING AN ADVERTISING PROGRAMME

1.Setting the advertising objectives2.Deciding on the advertising budget3.Choosing the advertising message4.Decding on the Media5.Evaluting advertising effectiveness

I. SETTING THE ADVERTISING OBJECTIVES

The advertising objectives must flow from prior decisions on target market,market positioning and marketing mix. Advertising objectives can be classifiedaccording to whether the aim is to inform, persuade or remind. Informativeadvertising figures heavily in the pioneering stage (to build a primary demand).Persuasive advertising becomes important in the competitive stage and Reminderadvertising is important with mature products.

II. DECIDING THE ADVERTISING BUDGET

There are five specific factors to consider when setting the advertisingbudget.

1.Stage in the Product Life Cycle New Products require more advertising2.Market Share High market share -less advertising3.Competition and clutter More advertising4.Advertising frequency High frequency requires more advertising


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5.Product substitutability More advertising

Methods of setting the advertising budget:

1.Affordable method2.Percentage of sales method

3.Competitive parity method4.Objective and task method

III.CHOOSING THE ADVERTISING MESSAGE

Ideally the message should gain attention, hold interest, arouse desire andelicit action (AIDA) Model.

1.What to say? MESSAGE CONTENTThere are 3 types of appeals. Rational, emotional and moral. Rational appealsclaim that the product has certain benefits. Emotional appeals attempt to stir upnegative or positive emotions that will motivate purchase. Ego, Fear, guilt, shame:

Humour, love, pride and joy. Moral appeals are directed to the audience sense ofwhat is right and proper.

2.How to say it? MESSAGE FORMAT & EXECUTION

In a print ad, the communicator has to decide the headline, copy,illustration and colour. If the message is over the radio the communicator has tochoose words and voice qualities. If the message is be carried on TV all theseelements plus body language have to be planned. Presenter has to pay attentionto facial expression, gesture, dress and posture and hairstyle.

Creativity is required in every aspect o message format and execution.

Creative people must find a cohesive style, tone, words and format for executingthe message. Memorable and attention-getting words must be found.

Any message can be presented indifferent execution styles:

1. SLICE OF LIFE This style show one or more typical people suing theproduct in a normal setting.

2. LIFESTYLE: This style shows how a product fits in with a particularlifestyle.

3. FANTASY This style creates a fantasy around the product or its use.(Dream themes)

4. MOOD OR IMAGE - This style BUILDS A MOOD OR IMAGE AROUND THE

PRODUCT, SUCH AS BEAUTY, LOVE OR SERINITY. No claim is mad aboutthe product except through suggestion

5. MUSICAL this style shows on e or more people or cartoon characterssinging a song about the product.

6. PERSONALITY - This style creates a character that represents the product.7. TECHCHNICAL EXPERTISE - This style shows the companys expertise in

making the product.8. SCIENTIFIC EVIDENCE - This style presents survey or scientific evidence

that the brand is better.


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9. TESTIMONIAL EVIDENCE - This style features a highly believable or likablesource endorsing the product.

Creativity is especially required for headlines. There are six basic types ofheadline:

1.NEWS New boom and more inflation ahead2.QUESTION Have you heard?3.NARRATIVE They laughed at me.4.COMMAND Dont buy5.1-2-3 WAYS 12 ways to save income tax6.HOW-WHAT-WHY -

Format elements such as ad size, colour and illustration will affect an adsimpact. Larger and colour ads gain more attention. Picture, headline and Copy areimportant in that order. Even then a really outstanding ad will be noted by about50% of the exposed audience.

IV.DECIDING ON THE MEDIA

Media selection involves finding the most t cost-effective media to deliverthe desired number of exposures to the target audience.

Choosing among the major media types:

Newspapers Flexibility, timeliness, short lifeTV Combines sight, sound, motion; has clutter, costlyDirect Mail Audience selectivity, Junk mailRadio Low cost, fleetingMagazines Long life, some waste circulation

Outdoor Low cost, creative limitationsYellow Pages Wide reach, high competitionInternet Interesting Low customers

Prof.V.Shekhar, Dept., of Business Management, Osmania University, Hyderabad-500 007

SELECTING SPECIFIC VEHICLES:The media planner must search for the most cost-effective media vehicles

within the chosen media type. Media planners calculate the Cost Per ThousandPersons reached by a vehicle. The media planner ranks each media by a cost perthousand and favors media with the low cost per thousand. However, severalfactors have to be considered in applying the cost per thousand measure. Theseare audience quality, audience attention probability, magazine editorial quality and

the magazines ad placement qualities and extra services like lead-time.DECIDING ON THE MEDIA TIMING

In choosing media, the advertiser faces a macro scheduling problem and amicro scheduling problem. The macro-scheduling problem involves schedulingthe advertising in relation to season and business cycle. The firm can vary itsadvertising expenditure to follow the seasonal pattern, oppose the seasonalpattern or to be constant throughout the year. Most firms pursue a seasonalpolicy.


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The micro-scheduling problem calls for allocating expenditure within ashort period to obtain maximum impact. Continuity is achieved by schedulingexposures evenly throughout the given period. Concentration calls for spendingall the advertising money in a single period. Fighting calls for advertising for someperiod, followed by a hiatus with no advertising, followed by a second period ofadvertising activity. Pulsing is continuous advertising at low-weigh levels

reinforced periodically by waves of higher activity.

V. EVALUATING ADVERTISING EFFECTIVENESS

A) COMMUNICATION EFFECT- RESEARCH seeks to determine whether anad is communication effectively. Called copy testing, it can be done before an adis put into media and after it is printed or broadcast.

1.DIRECT RATING METHOD asks consumers to rate alternate ads. These rating are

used to evaluate the following:

How well does the ad catch the readers attention?

How well does the ad lead the reader to read further?

How clear is the message?

How effective is the particular appeal?

How well does the ad suggest follow-through action?

2.PORTFOLO TESTS ask consumers to view or listen to a portfolio of advertisements,

taking as much time as they need. Consumers are then asked to recall all the ads and

their content, aided or unaided y the interviewer. Recall level indicates an ads ability to

stand out and to have its message understood and remembered.

3.LABORATORY TESTS use equipment to measure physiological reactions like

heartbeat, blood pressure, pupil dilation and perspiration to an and. These tests

measure attention getting poser but reveal nothing about the impact on beliefs,

attitudes, or intensions.

SALES EFFECT RESEARCH

Advertisings sales effect is generally harder to measure than its communicationeffect because sales are influenced by many factors as products features, price,


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availability and competitors actions. One way to measure the sales effect of advertisingis to compare past sales with past advertising expenditures (Historical approach).Another way is through experiments. i.e. to test the effects of different advertisingspending levels in different markets and measure the differences in the resulting saleslevel. It could spend the normal amount in one market area, half the normal amount inanother area, and twice the normal amount in a third area, If the three market areas are

similar, and if all other marketing efforts are the same, the differences in sales in thethree cities could be related to advertising levels.

FACTORS RESPONSIBLE FOR CONSUMER BEHAVIOUR

AS AN INDIVIDUAL

1.Personalilty

Personality is defined as those inner psychological characteristics that both

determine and reflect how a person responds to his or her environment

1)It reflects individual differences 2)It is consistent and enduring3)it can change

Sigmund Freuds psychoanalytic theory

Id pleasure principle Ego Superego-

2.-MOTIVATION

can be described as the driving force within individuals that impels them to action

Motivational research is research designed to uncover the consumers subconsciousor hidden motivations.

LEARNINGIs the process by which individuals acquire knowledge and experience.


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STRUCTURE OF MEMORY

SENSORY STORE- just for a second

SHORT TERM STORE BRIEF PERIOD, Look at tel no and forget before dialing. If

rehearsal takes place it goes to the long-term store

LONG TERM STORE- relatively extended periods of time for days, weeks, and even

years.

Pavlovian experiment Skinners experiment

ATTITUDES

Attitude is a learned predisposition to behave in a consistently favorable orunfavorable with with respect to a given object

Object here means such as issues, actions, behavior persons or events

PERCEPTION

Is the process by which an individual selects, organizes, and interprets stimuli into

meaningful and coherent picture of the world.

SOCIAL AND CULTURAL SETTINGS

GroupMay be defined as two or more people who interact to accomplish individual or

mutual goals.

FAMILYTwo or more persons related by blood, marriage or adoption that reside together.

Husband-dominated; wife dominated, Joint

SOCIAL CLASSDivision of members of a society into a hierarchy of distinct status classes, so that

members of each class have relatively the same statues and members of all other

classes have either more or less status


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UU LU UM Lm Ul LL

CULTURE

Is the sum total of learned beliefs, values, and customs that serve to direct the

consume behaviour s of members of a particular society.

Sub culture is a distinct cultural group that exists as an identifiable segment within a

larger more complex society.

INDUSTRIAL MARKETS/BUSINESS MARKETS

THE BUSINESS MARKET COMPRISES ALORGANISATIONS THAT BUY GODS AND SERVICESFOR USE IN THE PRODUCTION OF OTHER GOODSAND SERVICES FOR USE IN THE PRODUCTION OFOTHER PRODUCTS AND SERVICES OR FOR THE

PURPOSE OF RESELLING OR RENTING THEM TOOTHERS AT PROFIT.

CHARACTERISTICS OF AN INDUSTRIAL MARKET:

1.FEWER BUT LARGER BUYERS

THE INDUSTRIAL MARKET NORMALLY DEALSWITH FAR FEWER BUT LARGER BUYERS ANDTHEY PURCHASE IN BULK. FOR EXAMPLE, ATYRE MANUFACTURER HAS MANY CUSTOMERS INREPLACEMENT MARKET, BUT THE MAIN SALES


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WOULD BE BULK PURCHASES FROM ONE ORTWO MAJOR AUTOMOBILE MANUFACTURERS.

2.GEOGRAPHICALLY CONCENTRATED

MOST OF THE BUSINESS MARKETS AREGEOGRAPHICALLY CONCENTRATED AT FEWPLACES. CONSIDER FOR EXAMPLE PITAMPURNEAR INDORE, IN MADHYA PRADESH, WHEREALL LEADING AUTOMOBILE FIRMS HAVE PUT UPTHEIR MANUFACTURING UNITS THERE.(INDIASDETROIT).

3.DEMAND IS DERIVED

I.E., DEMAND IS DERIVED FROM DEMAND

FOR CONSUMER GOODS. A CAR MANUFACTURESBUYS STEEL BECAUSE CONSUMERS BUY CARS. IFCONSUMERS DEMAND FOR CARS DROPS, SOWILL THE DEMAND FOR STEEL AND OTHERPRODUCTS USED TO MAKE CARS. FOR EXAMPLE,INTELS LONG RUNNING INTEL INSIDEADVERTISING CAMPAIGN SELLS PERSONAL

COMPUTER BUYERS ON THE VIRTUES OF INTELMICROPROCESSORS. THE INCREASED DEMANDFOR INTEL CHIPS BOOS DEMAND FOR THE PCS


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CONTAINING THEM, AND BOTH INTEL AND ITSBUSINESS PARTNERS WIN.

4.DEMAND IS NOT EFFECTED BY PRICECHANGES

I.E., TOTAL DEMAND FOR MANY BUSINESSPRODUCTS IS NOT AFFECTED MUCH BY PRICECHANGES, ESPECIALLY IN THE SHORT RUN. ADROP IN THE PRICE OF LEATHER WILL NOTCAUSE SHOE MANUFACTURES TO BUY MUCHMORE LEATHER.

5.FLUCTUATING DEMAND

THE DEMAND FOR MANY BUSINESS GOODS

AND SERVICES TENDS TO CHANGE MORE ANDMORE QUICKLY- THAN THE DEMAND FORCONSUMER GOODS AND SERVICES DOES. ASMALL PERCENTAGE INCREASE IN CONSUMERDEMAND CAN CAUSE LARGE INCREASES INBUSINESS DEMAND. SOMETIMES A RISE OF ONLY10% IN CONSUMER DEMAND CAN CAUSE AS

MUCH AS A 200 % RISE IN THE DEMAND DURINGTHE NEXT PERIOD.

6.PROFESSIONAL PURCHASING


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A BUSINESS PURCHASE USUALLY INVOLVESMORE BUYERS AND MORE PROFESSIONAL

PURCHASING EFFORT. OFTEN, BUSINESS BUYINGIS DONE BY TRAINED PURCHASING AGENTS WHOSPEND THEIR WORKING LIVES LEARNING HOWTO BUY BETTER, THE COMPLEX THE PURCHASE,THE MORE LIKELY THAT SEVERAL PEOPLE WILLPARTICIPATE IN THE BUYING DECISIONPROCESS. BUYING COMMITTEES MADE UP OFTECHNICAL EXPERTS AND TOP MANAGEMENTARE COMMON IN THE BUYING OF MAJORGOODS.

7.COMPLEX BUYING DECISIONS

BUSINESS BUYERS USUALLY FACE MORECOMPLEX BUYING DECISIONS THAN DOCONSUMER BUYERS. PURCHASES OFTENINVOLVE LARGE SUMS OF MONEY, COMPLEXTECHNICAL AND ECONOMIC CONSIDERATIONS,AND INTERACTIONS AMONG MAY PEOPLE ATMANY LEVELS OF THE BUYERS ORGANISATION.

BUSINESS BUYERS MAY TAKE LONGER TIME TOMAKE THEIR DECISIONS BECAUSE OF THECOMPLEXITY OF DECISIONS. FOR EXAMPLE THEPURCHASE OF A LARGE COMPUTER SYSTEM MAY


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TAKE MANY MONTHS OR MORE THAN A YEAR TOCOMPLETE AND COULD INVOLVE A FEW CRORESOF RUPEES, THOUSANDS OF TECHNICAL

DETAILS, DOZENS OF PEOPLE RANGING FROMTOP MANAGEMENT TO LOWER-LEVEL USERS.

8.BUYING PROCESS IS MORE FORMALISED

THE BUSINESS BUYING PROCESS TENDS TO BEMORE FORMALISED THAN THE CONSUMERBUYING PROCESS. LARGE BUSINESS PURCHASESUSUALLY CALL FOR DETAILED PRODUCTSPECIFICATIONS, WRITTEN PURCHASE ORDERS,CAREFUL SUPPLIER SEARCHES, AND FORMALAPPROVAL. THE BUYING FIRM MIGHT EVENPREPARE POLICY MANUALS THAT DETAIL THE

PURCHASE PROCESS.

9. BUYING MOTIVES

FINALLY, BUSINESS PURCHASE DECISIONSARE PRIMARILY RATIONAL, WHILE CONSUMERBUYING BEHAVIOUR IS RATIONAL AS WELL AS

EMOTIONAL.

INDUSTRIAL MARKETS & CONSUMER MARKETS-DIFFERENCES


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INDUSTRIAL MARKETS CONSUMERMARKETS

GEOGRAPHICALLY CONCENTRATEDGEOGRAPHICALLY DISPERSEDRELATIVELY FEWER BUYERS MASS

MARKETS

TECHNICAL COMPLEXITY

STANDARDISATION

SERVICE-V.IMP SOMEWHAT

IMPORTANT

TECHNICAL EXPERTISE LESS

TECHNICAL EXPERTISE

RATIONAL MOTIVES

PSYCHOLOGICAL MOTIVES

INTERPERSONAL RELATIONSHIPS NON-INTERPERSONAL RELATION

FUNCTIONAL INVOLVEMENT FAMILY

INVOLVEMENT

SHORTER CHANNELS LONGER

PERSONAL SELLING

ADVERTISING

COMPETITIVE BIDDING &NEGOTIATION LIST PRICES

INDUSTRIAL BUYER BEHAVIOUR


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MAJOR TYPES OF BUYING DECISIONS

1.STRAIGHT REBUY

IN A STRAIGHT REBUY , THE BUYERREORDERS SOMETHING WITHOUT ANYMODIFICATIONS. IT IS USUALLY HANDLED ON AROUTINE BIAS BY THE PURCHASINGDEPARTMENT. BASED ON PAST BUYINGSATISFACTION, THE BUYER SIMPLY CHOOSESFROM THE VARIOUS SUPPLIERS ON ITS LIST. ITIS THE MOST COMMON BUYING SITUATION ININDUSTRIAL PURCHASING.

2.MODIFIED REBUY

IN A MODIFIED REBUY, THE BUYER WANTSTO MODIFY PRODUCT SPECIFICATIONS, PRICES,TERMS OR SUPPLIERS. THE MODIFIED REBUYUSUALLY INVOLVED MORE DECISIONPARTICIPANTS THAN THE STRAIGHT REBUY.THIS BUYING DECISION IS INVOLVED WHEN THEY

FEEL THAT SIGNIFICANT BENEFITS SUCH ASQUALITY IMPROVEMENTS, REDUCTIONS MAY BEDERIVED FROM REDEFINING ALTERNATIVES.


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3.NEW TASK

THE MOST COMPLEX BUYING SITUATION IS

NEW TASK. A COMPANY BUYING APRODUCT OR SERVICE FOR THE FIRST

TIME FACES A NEW TASK SITUATION. IN

SUCH CASES, THE GREATER THE COST OR

RISK, THE LARGER THE NUMBER OF

DECISION PARTICIPANTS AND THE

GREATER EFFORTS TO COLLECT

INFORMATION WILL BE. THE NEW TASK IS

THE MARKETERS GREATEST

OPPORTUNITY AND CHALLENGE. IN THE

NEW TASK SITUATION, THE BUYER MUST

DECIDE ON PRODUCT SPECIFICATION,SUPPLIERS, PRICE LIMITS, PAYMENT

TERMS, ORDER QUANTITIES, DELIVERY

TIMES AND SERVICE TERMS.

PARTICIPANTS IN THE BUSINESS BUYING

PROCESS

THE DECISION-MAKING UNIT OF

BUSINESS MARKETS IS CALLED BUYING


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CENTRE. I.E., ALL THE INDIVIDUALS AND

UNITS THAT PARTICIPATE IN THE

BUSINESS DECISION-MAKING PROCESS.

THEY MAY PLAY ANY OF THE FIVE ROLES

IN THE PURCHASE DECISION PROCESS:

1.USERS : ARE MEMBERS OF THE

ORGANISATION WHO WILL USE THE

PRODUCT OR SERVICE.

2.INFLUENCERS: OFTEN HELP DEFINE

SPECIFICATIONS AND ALSO PROVIDE

INFORMATION FOR PROVIDING

ALTERNATIVES.

3.BUYERS: HAVE FORMAL AUTHORITY TO

SELECT THE SUPPLER AND ARRANGE

TERMS OF PURCHASE.

4.DECIDERS: HAVE FORMAL OR

INFORMAL POWER TO SELECT OR

APPROVE THE FINAL SUPPLIERS.

5.GATEKEEPERS : CONTROL THE FLOW

OF INFORMATION TO OTHERS. FOR

EXAMPLE, PURCHASING OFFICERS OFTEN


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HAVE AUTHORITY TO PREVENT

SALESPERSONS FROM SEEING USERS OR

DECIDERS. OTHER GATEKEEPERS INCLUDE

TECHNICAL PERSONNEL AND EVEN

PERSONAL SECRETARIES.

MAJOR INFLUENCES ON INDUSTRIAL BUYERS

1.ENVIRONMENTAL FACTORS ECONOMIC,TECHNOLOGICAL, POLITICAL, COMPETITIVE &CULTURAL2.ORGANISATIONAL FACTORS POLICIES,PROCEDURES ETC.,(CENTRALISED/JIT ETC)3.INTERPERSONAL FACTORS GROUPDYNAMICS

4.INDIVIDUAL FACTORS - AGE, EDUCATION,JOB POSITION, PERSONALITY, PERCEPTIONS

ETC., ALSO, BUYERS HAVEDIFFERENT BUYING STYLES.

THE BUSINESS BUYING PROCESS

1.PROBLEM RECOGNITION 2.GENERAL NEEDDESCRIPTION 3.PRODUCT SPECIFICATION 4.SUPPLIERSEARCH 5.PROPOSAL SOLICITATION 6.SUPPLIER


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SELECTION 7.ORDER-ROUTINE SPECIFICATION8.PERFORMANCE REVIEW.

1.PROBLEM RECONGITION

LAUNCHING A NEW PRODUCT, BREAKDOWN OF AMACHINE, PURCHASING MANAGER IS UNHAPPY WITHTHE CURRENT SUPPLIERS

2.GENERAL NEED DESCRIPTION

THE BUYER NEXT PREPARES A GENERAL NEEDDESCRIPTION THAT DESCRIBES THE CHARACTERISTICSAND QUANTITY OF THE NEEDED ITEM.

3.PRODUCT SPECIFICATION

DEVELOPING THE ITEMS TECHNICAL PRODUCT

SPECIFICATIONS. VALUE ANALYSIS IS AN APPROACHTO COST REDUCTION IN WHICH COMPONENTS ARESTUDIED CAREFULLY TO DETERMINE IF THEY CAN BEREDESIGNED OR MADE BY LESS COSTLY METHODS.

4.SUPPLER SEARCH

CONDUCTING A SUPPLIER SEARCH TO FIND THE BESTVENDORS BY REVIEWING TRADE DIRECTORIES,COMPUTER SEARCH, PHONING OTHER COMPANIESETC., THE NEWER THE BUYING TASK, AND, MORECOMPLEX AND COSTLY THE ITEM, THE GREATER THE


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AMOUNT OF THEM THE BUYER WILL SPENDSEARCHING F FOR SUPPLIERS.

5.PROPOSAL SOLICITATION

INVITING THE QUALIFIED SUPPLIERS TO SUBMITPROPOSALS, IN RESPONSE, SOME SUPPLIERS, WILLSEND CATALOGUES, SALES PERSON, OR DETAILEDWRITTEN PROPOSALS.

6.SUPPLIER SELECTION

DRAWING UP A LIST OF THE DESIRED SUPPLERATTRIBUTES LIKE PRODUCT QUALITY, ON TIMEDELIVERY, ETHICAL CORPORATE BEHAVIOUR,COMPETITIVE PRICES, PERFORMCE HISTORY,REPUTATION ETC., AND RANKING THEIR RELATIVEIMPORTANCE. BUYERS MAY NEGOTIATE WITH

PREFERRED SUPPLIERS FOR BETTER PRICES ANDTERMS BEFORE MAKING THE FINAL SELECTIONS.

7.ORDER ROUTINE SPECIFICATION

PREPARING AN ORDER-ROUTINE SPECIFICATIONWHICH INCLUDES THE FINAL ORDER WITH ITEMS

SUCH AS TECHNICAL SPECIFICATION, QUANTITYNEED, EXPECTED TIME OF DELIVERY, RETURNPOLICIES, AND WARRANTIES.

8.PERFORMANCE REVIEW


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REVIEWING THE PERFORMANCE FORM USERS. THEPERFORMANCE REVIEW MY LEAD THE BUYER TOCONTINUE, MODIFY OR DROP THE ARRANGEMENT.

THE ACTUAL PROCESS IN THE ABOVE STAGES ISMUCH MORE COMPLEX THAN DISCUSSED ABOVE.ALSO SOME OF THESE STAGES MAY BE COMPRESSEDOR BYPASSED.

Professor V.SHEKAHR

MARKETING


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Marketing is typically seen as thetask of creating, promoting anddelivering goods (physical) services

(airlines, hotels, barbers, lawyers,) -Many market offerings consist of avariable mix of goods and services.Events (Olympics, sports) persons(Celebrity marketing) places (cities,nations) properties (physical/financial), organisations (Corporateimage), information(educationalinstitutions, magazines) andideas(Products and services areplatforms for delivering some idea orbenefit) to consumers andbusinesses.

Definition- Marketing is the processof planning and executing theconception, pricing promotiondistribution of idea goods, services tocreate exchanges that satisfyindividual and organisational goals.

Exchange is the core concept ofmarketing: For exchange potential to


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exist, some conditions must besatisfied like-

1.There are atleast 2 parties2.Each party has something thatmight be of value to the other party.3.Each party is capable of communication and delivery4.Each party is free to accept orreject the exchange offer

LEVELS OF COMPETITION:

1.BRAND COMPETITION Matiz vs Santro2.INDUSTRY COMPETITION All carmanufacturers3.FORM COMPETITION All automobilemanufacturers3.GENERIC COMPETITION- All companiesthat compete at the same rupee value likemajor consumer durables, apartments.


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MARKETING MIX

Marketing mix is the set of marketing toolsthat the firm use s to pursue its marketingobjectives in the target market.

McCarthy classified these tools into fourbroad major groups that he called as 4 Ps.

PRODUCT - solution

Product variety, Quality, Design, Features,brand name, packaging, serviceswarranties,

PRICE - cost

List price, discounts, allowances, paymentperiod, credit terms etc

PROMOTION - communication

Sales promotion, advertisements, salesforce, public relations, direct marketing

PLACE - convenience


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Channels, Locations, Inventory, Transport

MARKETING PHILOSOPHIES

PRODUCTION CONCEPT holds thatconsumers will prefer products that arewidely available and inexpensive.

PRODUT CONCEPT- holds that consumerswill favour those products that offer themost quality, performance or innovativefeatures.

SELLING CONCEPT holds that consumers

and businesses, if left alone, will ordinarynot buy enough of the organisationsproducts and hence organistaions shouldundertake aggressive selling andpromotion effort.

MARKETING CONCEPT- holds that the keyto achieving its organisations goalsconsists of the company being moreeffective than competition in creating ,


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delivering and communicating customervalue to its chosen target markets.

Find wants and fill themPutting people first British AirwaysLove the customer , not the product

RELATIONSHIP MARKETING Building longterm relationships.

MANAGING PRODUCT LINES AND BRANDS

PRODUCT CLASSIFICATIONS-1. Non- Durable goods- tangible goodsnormally consumed in one or few uses-

many locations, heavy advertising, buildbrand loyalty2.Durable goods tangible goods thatnormally survive many usespersonal selling and service,3.Services intangible, inseparable,variable and perishable- Quality controlsupplier credibility etc.

CATEGORIS OF SERVICE MIX


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1.Pure tangible good toothpaste2.Tangible good with accompanyingservice car services

3.Hybrid Hotel/Restaurant4.Major service accompanying minorgoods & services Airlines- food, drinks,5.Pure service massage,

EQUIPMENT BASED OR PEOPLE BASEDAutomatic car washing Vs manual windowwashing

CLIENTS PRESENCE OR NOTBrain surgery, haircut Vs scooter repair or

TV repair

PRODUCT MIXAlso called as product assortment is the

set of all products and items that aparticular seller offers for sale.

INSEPARABILLITYIn the case of entertainment and

professional services buyers are veryinterest in the specific provider. MS

VARIABILLITY


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Because it depends on who performs

PERISHAILITY

Differential pricingNonpeak demand

PRODUCT LINE

A product mix consists of various productlines,

e.g. Detergents, toothpaste, bar soap,paper tissue

PRODUCT WIDTH

Width of a product mix refers to how maydifferent product lines the companycarries.

DEPTH refers to how may variants areoffered of each product line.


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CONSISTENCY refers to how closelyrelated the various product lines are in

end use like production requirements,distribution channels.

PACKAGINGIncludes the activities of designing andproducing the container for the product.Primary package old spice after shavelotion bottleSecondary package cardboard boxShipping package corrugated boxes forholding secondary package.

FUNCTIONS-1.Attracts attention2.Describes the products features3.Constant advertisement

SEGMENTATION


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Segmentation is an approach midwaybetween mass marketing and individualmarketing.

BASES FOR SEGMENTATION

GEOGRAPHIC - Region, city,DEMOGRAPHIC - Age, Family size, Familylife cycle, Gender, Income, Occupation,EducationOTHERS Personality, Occasions Regular, occasion, special occasion; Usagerate Light , medium, heavy

PRODUCT LIFE CYCLE

It is assumed that Products have life

cycles.

Product live cycle stages are divided into 4stages-1.Introduction A period of slwo salesgrowth as the product is introducted inthe market2.Growth A period of rapid marketacceptance and substantial profitimprovement


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3.Maturityu A period of slwodown insales growth because the product hasachieved acceptance by most potentail

buyers.4.Declilne sales show downward drift.

PLC concept is used to analyseBranded Products have shoter lifecyckles.Products may have a shorter or longer lifecylcleP roduct forms manual typewriters toelectric to electronic to -----follow thestandard PLC faithfullyProduct categories have the longest lifecycles- newspates, tvs, telephones etc.,

MARKETING STRATEGIES DURINGDIFFERENT STAGES OF PLC

Markting Research is the systematicdesign collection, anaysius and reprotingof data nd findings relevant ta specifcmarketing situation facing hthe company.

Markeing Research Process-


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1.Define the Problem and Research

Objectives-

2.Develop the Researcvh Plan

Primary data and secondary data

Researchg approcahes

Observationbal reserch

Focus group research

Survey research

Experimental research cause & effect

Research Insturments

Questionnaries- Closed End

Dichotomour tweo possible answers

Multiple choice many answers

Scales Rating, Importance, Intention to

buy, semantic differential


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Likert agreement and disagrmeent

OPEN END QUESTIONS

Completely unsturctured

Word assocition, Sentence completion,

Story completion, Picture completing, TAT

Mechanical instrumetns-

Eye cameras

Galvanometers measure the interest or

emotions aroused to a specific picture or

ad.

Audimeter is attached to televison sets

Sampling Plan

Sampling Unit Who is to be surveyed

Sample size- How many

Sampling poricedure How respondentsshould be chosenm Random, Judgement

etc.,

3.Collect the information


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4.Analyse the information

5.Present the findings

METHODS OF ESTIMATING THE FUTURE

DEMAND OF THE PRODUCT

1.Survey of Buyers intentions

2.Composite sales force opinions

3.Expert opinion

4.Past sales analysis

5.Test marketing

Elements in the Communication Process


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Sender- Encoding-Message

Decoding-Receiver

Response, feedback and noise

Developing effective Communications

Steps

1.Identify the target audience-image

analysis, familiarity, favourabilty

analysis

2.Determine the communication

objectives Cognitive, affective or

behavioral

Cognitive- Put something in

consumers mind

Affective change an attitude

Behavioral ;- get the consumer to act3.Design the message

4.Select the communication channels


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5.Budget

6.Decide on the communications mix

7.Meausre results

8.Mange the integrated

communication process

Marketing Communication Mix

Advertising Print and Broadcast

ads, Packaging, Brochures, Booklets,

Posters, leaflets, Directories,

Billboards, Reprints of ads, POP,Audiovisual material , Display signs

Sales Promotion Contests, games,

premiums, gifts, sampling, Fairs and

trades shows, Demonstrations,Rebates, Low interest financing. Tie-

ins


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1.Informative advertising-pioneeringstage2.Persuasive advertising- competitive

stage uses comparative3.Reminder advertising mature products

DAGMAR Defining Advertising Goals forMeasuring Advertising Results

ADVERTISING BUDGET

Factors considered - stage in the PLC,market share and consumer base,competition and clutter, ad frequency,

METHODS OF ADVERTISING BUDGET

Percent of sales, Affordability, Competitiveparity, Objectives and task method

David Ogilvy- brand image Confessionsof an Advertising man and oglivy onAdvertising use celebrities


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ROSSER REEVES USP Balsara cloveoil relates only to advertising whereaspositioning is a basic decision.

Leo Burnett advocated the use of commonman

ADVERTISING MESSAGE

1.Message Content What to say2.Message Structure How to say itlogically3.Message Format- How to say itsymbolically

4.Message Source Who should say it

MESSAGE CONTENTRational- quality, economy, value,performanceEmotional negative, love, pride, joy -vicksMoral-aids

Humour fevicol,amul,Fear- bad smell,licceasefireMESSAGE STRUCTURE


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One sided and two sided

M ESSAGE FORMAT

Headline, copy, illustration, colour in TVbody language

MESSAGE SOURCECelebrities, doctors, opinion leaders

Message generation benefitDesirability, Exclusiveness, believability

Message ExecutionMessages impact depends not only on

what is said but how it is said- style, tone,

words, formatExecution Styles Slice of life, lifestyle,fantasy, mood, personality symbol,technical expertise, scientific evidence,and testimonial.HEADLINES News New Boom and inflation aheadQuestion - Have you heard aboutNarrative They laughed when I sat onthe piano but whenCommand Dont buy unless


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1-2-3 Ways 12 Ways to save yourincome taxHow-What Why- How to increase the

PICTURE ,headline, copy - Reader noticesthe picture first

MEDIA SELECTION -

Reach The number of different personsor households exposed to a particularmedia schedule atleast once during aspecified time period. while launchingnew products, undefined target market,

Frequency The number of time withinthe specified time period that an averageperson or household is exposed to themessage when there are strongcompetitors, frequent purchase cycle.

Impact The qualitative value of anexposure through a give medium( Children ad in chandamama thanWomans World)


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COST PER THOUSAND

If a full-page colour ad in Times of India is

4lakhs and the estimated readership is 9lakhs, the cost of exposing the ad to 1000persons is approximatelyCost 4,00,000

Readers 9,00,000

Media schedulingBurstContinuousIntermittent

Evaluating advertising effectiveness

Communication effect research seeks todetermine whether ad is communicatingeffectively CALLED COPY TESTING

Direct rating, Portfolio, lab tests3 Methods of ad pre-testingDirect Rating Method asks consumers torate alternative ads,Portfolio tests ask consumers to view orlisten to a portfolio of advertisements,taking as much time as they need.


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Consumers are asked to recall all the adsand their content aided or unaided by theinterviewer.

Laboratory test use equipment to measurephysiological reactions Heart beats,blood pressure, pupil dilation,perspiration,

The parameters on which an ad copy has

to be evaluated or tested are desirability ,exclusiveness and believabilityRECONGITION TESTS-ADS ARE NOTSHOWNNOTED number of respondents who

remember having seen the ad

SEEN ASSOCIATED is the number ofreader showing who have seen the ad andthe brand or companyREAD MOST no of respondents whohave read the copy.

RECALL AIDED OR UNAIDED

Sales Effect research Historical approach


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SALES PROMOTION consists of a diversecollection of incentive tools mostly shortterm

PUBLIC RELATIONS involves a variety ofprograms designed to promote or protecta companys image or its individualproducts

SALES FORCE MANAGEMENT

The term sales representative can cover Deliverer, order taker, Missionary,Technician, Demand creator, solution

vendor,

FUNCTIONS OF SALES PERSON Prospecting, targeting, communicating,

selling, servicing, information gathering,etc.,

Time and duty analysisPerpetration Planning call strategyTravel means of transportationFood , Waiting, Selling,


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Administration Writing reports, billing,sales meeting, etc,

PRINCIPLES OF PERSONAL SELLINGPROSPECTING Examining datasources ,putting a booth in trade show,current customer, cultivating, coldcanvassing dropping in unannouncedoffices places.

PREAPPROACH phone, visit, time, letter,

APPROCAH Greeting,

PRESENTTAION AND DEMONSTRATION

AIDA Gaining attention, holding interest,arousing desire, and obtaining action.Features, advantages, benefits and valueSTYLES OF PRESENTATIONCANNED memorises sales talkNEED SATISFACTION APPROACH

OVERCOMING OBJECTIONS

CLOSING


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FOLLOW UP AND MAINTENANCE

SPIN Situation, Problem, Implication,

Need Payoff

RELATIONSHIP MARKETING is based onthe premise that important accounts needfocussed and continuous attention.

VERTICAL MARKETING SYSTEM

Corporate VMS Bata,Administered VMS MarutiContractual VMS Thumps up

HORIZONTAL MARKETING SYSTEMTVS-WHIRLPOOL ONIDA Two or morenon related companies working together.(Symbiotic marketing)

Marketing process



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2.Researching & selecting target

markets

3.Developing marketing strategies4.Planning marketing programmes


ANALYSING MARKETING OPPORTUNITIES

*Marketing Information System Internal

Records System, Marketing IntelligenceSystem , Marketing Research, MarketingDSS

Marketing Research PROCESS- Defininingthe problem and research objective,developing the research plan, collecting

the information, analyzing theinformation, presenting the findings.


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Methods of sales forecasting Survey ofbuyers intentions, composite sales forceopinion, expert opinion, market testing.

Scanning the Marketing Environment -

Macro and Micro

Analysing Consumer Markets and BuyerBehaviour &

Analysing Business Markets andBusiness Buying Behaviour &

Cultural, subcultural, social, groups,family, age , life cycle, income,

perception, motivation, learning, attitudes

Buying Roles Initiators, influencers,deciders, buyers, users

Low involvement and high involvement

Buying stages Problem recognition,information search, evaluation ofalternatives, purchase decision, post-


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purchase behavior. ( Satisfaction Dissatisfaction Dissonance)

BUSINESS Markets have fewer and largerbuyers, closer customer supplierrelationship, more geographicallyconcetrated, demand is derived fromconsumer markets,. Professionalpurchasers,

Stages in the Business Buying processCALLED BUY PHASES1.Problem recognition 2.General needdescription 3.Product specification

4.Supplier search 5.Proposal solicitation

6.Suppllier selection 7.Order-routinuespecification 8.performance review.

*DEALING WITH COMPETITION Competitors analuyis attack or avoidCompetitive intelligenceCustomer Value analysis Market leader larget shareChallenger attacjs narket leader 5typesFrontal


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FlankEncirclementBypass

Guerilla

Follower runner up imitator, adaptorNicher- serves small market segments

*Market segmentation and target

marketingBases of market segmentation


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(OU Campus)-For private circulation only

COMPANY ORIENTATIONS TOWARD THEMARKETPLACE

PRODUCTION CONCEPTThe production concept holds that the consumers will prefer products

that are widely available and inexpensive.Managers of Production-oriented

business concentrate on achieving high production efficiency, low costs and

mass distribution. They assume that consumers are primarily interested in

product availability and low prices. This orientation makes sense in

developing countries, where consumers are more interested in obtaining the

product than its features. It is also used when a company wants to expand

the market.

PRODUCT CONCEPT

The product concept holds that consumers will favour those products

that offer the most quality, performance, or innovative features. Managers in

these organisations focus on making superior products and improving them

over time. They assume that buyers admire well-made products and can

appraise quality and performance. Management might commit the better

mouse-trap fallacy. Product oriented companies often design their products

with little or no customer input. Very often they will not examine theircompetitors products. The product concept can lead to marketing myopia.

(Theodore Levitt Marketing Myopia Harvard Business Review-

August,1960).These organisations are often looking into a mirror when they

should be looking out of the window.

SELLING CONCEPT

The selling concept holds thatconsumers and businesses, if left alone,will ordinarily not buy enough of theorganisationals products. The


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organisation must, therefore, undertakean aggressive selling and promotioneffort.The concept assumes that

consumers typically show buying inertia orresistance and must coaxed into buying.Italso assumes that the company has awhole battery of effective selling andpromotion tools to stimulate morebuying.The selling concept is practised

most aggressively with unsought goods,goods that buyers normally do not think ofbuying , such as insurance, encyclopediasetc.The selling concept is also practiced inthe nonprofit area such as fund-raisers,

political parties etc. A political party

vigorously sells its candidates to votes.But marketing based on hard sellingcarries high risks.

MARKETING CONCEPT

The marketing concept holds that the

key to achieving its organisational goalsconsists of the company being moreeffective than competitors in creating,delivering, and communicating customer


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value to its chosen target markets. Themarketing concept has been expressed inmany colourful ways.

*Find wants and fill them *Love the customer, not

the product

*Putting people first *The customer is

the king

The selling concept takes an inside-out perspective.It starts with the

factory, focuses on existing products, and calls for heavy selling and

promoting to produce profitable sales. The marketing concept takes an

outside-in perspective. It starts with a well-defined market, focuses on

customer needs, coordinates all the activities that will affect customers, and

produces profits by satisfying customers.

SOCIETAL MARKETING CONCEPT

The societal marketing concept holdsthat the organisations task is todetermine the needs, wants,and interests

of target markets and to deliver thedesired satisfactions more effectivelyefficiently than competitors. In a way thatpreserves or enhances the customers andsocietys well being.The societal marketingconcept calls upon marketers to buildsocial and ethical considerations into theirmarketing practices, They must balance


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and juggle the often conflicting criteria ofcompanys profits, consumer wantsatisfaction, and public interest. They

believe that customers will increasinglylook for demonstrations of good corporatecitizenship.

Professor V.Shekhar, Department of Business Management, Osmania University, Hyd-7


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MARKETING CONTROL

1.Annual Plan Control 2.Profitabilty control 3. Efficiency control 4. Strategic

control

ANNUAL PLAN CONTROL

The purpose of annual plan control is to ensure the

company achieves sales profits, and other goals established

in the annual plan. The heart of annual plan control is

management by objectives.

Tools of Annual Plan Control

1. Sales Analysis Consists of measuring and evaluatingactual sallies in relation to sales goals. Sales varianceanalysis measure the relative contribution of differentfactors to a gap in sales performance Microsalesanalysis looks at specific products, territories, and soforth that failed to produce expected sales.

2. Market Share Analysis It can be done in three ways:

a) Overall market share is the companys salesexpressed as a percentage of total market sales.


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b) Served market share is its sales expressed as apercentage of the total sales to its served market(Served market share is always larger than thetotal market share).

c) Relative market share can be expressed asmarket share in relation to its largest competitor.

3. Marketing Expense-to-Sales Analysis: It is the key to

watch that the company is not overspending to achieve sales

goals.

4. Financial Analysis: Here the Expense to Sales ratiosare analysed in an overall financial framework to determines

how and where the company is making its money.

5. Market Based Scorecard Analysis Here two types of

scorecards are Prepared :

a) Customer performance scorecardb) Stakeholder performance scorecard

PROFITABILITY CONTROL

Seeks to measure and control the profitability of various products, territories,

customer groups, trade channels and order sizes.

Marketing Profitability Analysis


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For example a lawnmower company wants to determine the profitability of selling its

lawnmower through three types of retail channels: hardware stores, garden supply

shops, and departmental stores. The following activities are carried out for

conducting the marketing profitability analysis -

1.Identifying functional expenses

2.Assigning functional expenses to marketing entities

3.Preparing a profit and loss statement for each

marketing entity.

Based on the analysis of this exercise the company

determines corrective action.

Activity Based Accounting

Companies are showing a growing interest in using

marketing profitability analysis or its broader version, activity

based cost accounting (ABC) to quantity the true

profitability of different activities. ABC can give managers a

clear picture of how products, brand, customers, facilities,

regions, or distribution channels both generate revenues and

consumer resources. To improve profitability, manager canthen examine ways to reduce the resources required to

perform various activities, or make the resources more

productive to acquire them at a lower cost. Alternatively,

management may raise prices on products that consume


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heavy amount of support resources. The contribution of ABC

is to refocus managements attention away from using only

labour or material standard costs to allocate full cost, and

toward capturing the actual costs of supporting individualproducts, customers and other entities.

EFFICIENCY CONTROL

Focuses on finding ways to increasethe efficiency of the sales force,advertising, sales promotion anddistribution.

1.Sales Force Efficiency key indicators are average number of calls per salesperson per day, average

sales call time per contact, average revenue per sales call, average cost per sales call, entertainment cost

per sales call etc.,

2. Advertising Efficiency Advertising cost per thousand

target buyers reached by media vehicle, percentage

audience who noted, saw or associated, and read most of

each print ad. Consumers opinion on the ads content and

effectiveness, before and after measures of attitude toward

the product, number of inquiries stimulated by the ad and

cost per Inquiry.


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3. Sales Promotion Efficiency Percentage sold on deal,

percentage of coupons redeemed, number of inquiries

resulting from demonstration.

4. Distribution Efficiency Management needs to search for

distribution efficiency in inventory control, warehouse

locations and transportation models.

STRATEGIC CONTROL

From time to time, companies need toundertake a critical review of overallmarketing goals and effectiveness. Each

company should periodically assess itsstrategic approaches to the market placewith marketing effectiveness review,marketing audit and Ethical and Social

Responsibility Review

Marketing Effectiveness ReviewA companys marketing effectiveness is reflected in the degree to which it exhibits the following

five major attributes of a marketing orientation.


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1. Customer Philosophy Whether the managementrecognises the importance of delivering the needs andwants of chosen markets

2. Integrated Marketing Organisation To check if there

is a high-level marketing integration and control of themajor marketing functions.

3. Adequate Marketing Information Whether marketingresearch studies are being conducted on a regularbasis.

4. Strategic Orientation

i. What is the extent of formal marketingplanning ?ii. How impressive is the current marketing

strategy ?iii. What is the extent of contingency thinking and

planning ?

2. Operational efficiency How well is the marketing

strategy communicated and implemented ?

Marketing Audit

A marketing audit is a comprehensive, systematic,

independent and periodic examination of a companys or

business units marketing environment, objectives,

strategies, and activities with a view to determining problem

areas and opportunities and recommending a plan of action

to improve the companys marketing performance. The

components of a marketing audit are marketing environment,


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marketing strategy, marketing organisation, marketing

system, marketing productivity and marketing function.

Ethical and Social Responsibility Review

There are ethical and moral issues likebribery, stealing trade secrets, false anddeceptive advertising, quality and safety

of products, price fixing, barriers to entryetc., Companies need to evaluate whetherthey are truly practicing ethical andsocially responsible marketing.

SUMMARY OF MARKETING CONTROL

ANNUAL CONTROL

1.Sales Analysis

2.Market Share Analysis

3.Marketing Expense-to-Sales Analysis


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4.Financial Analysis

5.Market Based Scorecard Analysis

PROFITABILITY CONTROL

Marketing Profitability Analysis

Activity Based Accounting

EFFICIENCY CONTROL

1. Sales Force Efficiency

2. Advertising Efficiency

3. Sales Promotion Efficiency

4. Distribution Efficiency

STRATEGIC CONTROL

Marketing Effectiveness ReviewMarketing AuditEthical and Social Responsibility Review


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(OU Campus)- For Private Circulation Only

MARKETING ENVIRONMENT

Companies must constantly watch and adapt to the marketing

environment in order to seek opportunities and ward off threats. The

marketing environment comprises of all the actors and forces influencing the

companys ability to transact business effectively with its target customers.

MICROENVIRONMENT

The microenvironment consists of forces close to the company that

affects its ability to serve its customers the company, suppliers, marketing

channel firms, customer markets, competitors and public.

1.The company Top management, and other departments

2.Suppliers Value delivery system

3.Marketing intermediaries Resellers, physical distribution firms

4.Customers Five types

a) Consumer markets personal consumption

b) Business markets further processing or for use in production process

c) Reseller markets to resell for a profit

d) Government markets Government and government agencies

e) International markets Buyers in other countries Any of the above

markets

5) Competitors for their strategies

6) Publics Banks, financial institutions, investment houses, newspapers,

magazines, television, consumer groups, environmental groups, minority

groups, neighborhood residents, general public and companys internal

public.


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MACRO ENVIRONMENT

1.Demographic 2.Economic 3.Natural 4.Technological 5.Political 6.Cultural

DEMOGRAPHIC ENVIRONMENT

Demography is the study of human population in terms of size,

density, location, age, gender, race, occupation, and other statistics.

Demography refers to the vital and measurable statistics of the population.

Marketers have to keep a close track of demographic trends and

developments in their markets. They should track changing:

Population Growth: The world population is

showing explosive growth.Age structure How many young people, old or middle aged

Family structure Late marriages, number of

working women, divorce rates, single parenthouseholds, live in companionships etc.,

Geographical shifts in population Rural to

urban to suburbanEducated population and white-collar population

Ethnic Markets: Countries also vary in ethnic and racial make-up. At one

extreme is Japan where almost every one is Japanese; at the other is United

States where people from virtually all nations can be seen.

ECONOMIC


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Markets require purchasing poweras well as people. The economicenvironment consists of factors that

affect consumer purchasing powerand spending patterns. Changes inincome, income distribution, spendingpatterns (i.e. percentage spent offood, housing, utilities, clothing,transportation, health care,

entertainment, insurance etc.

Marketers must pay carefulattention to major a changes inincomes, cost of living, interest rates,savings, and borrowing patterns

because they can have high impact onbusiness especially for companieswhose products have high income andprice sensitivity.

NATURAL

The deterioration of natural environment is a major global

concern. In many world cities air and water pollution have

reached dangerous levels. Greenhouse effect: i.e.- dangerous

warming of the earth. Marketers need to be aware of the threats


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and opportunities associated with trends in natural environment.

These are :

1. Shortages of raw material Air, water, forests, oil, coal, minerals2. Pollution disposal of chemical and nuclear waste, littering ofearth with plastic3. Increased government intervention

TECHNOLOGICAL

One of the most dramatic forces shaping people lives is technology.

Technology has released such wonders as penicillin, open- heart surgery,

birth control pill, antibiotics, organ transplantation, computers and Internet. It

has released such horrors such as hydrogen bomb, nerve gas, nuclearmissiles, chemical and biological weapons and the machine gun. It has also

released such mixed blessings as the automobile, Credit cards and the TV.

Every new technology is a force for creative destruction of old things. The

economys growth rate is affected by how many major new technologies are

discovered. Unfortunately technological discoveries do not arise evenly

through time.

Many of the todays common products were not available 50 years

ago. E.g personal computers, video recorders, fax machines, cell phones.Scientists are working on AIDS cures, happiness pills, robots for fire fighting,

under water exploration, home nursing, flying cars, space colonies etc., New

technologies create new markets and opportunities as well as threats.

Marketers should watch the technological changes closely.

POLITICAL

Marketing decisions are strongly affected by developments in political

and legal environment. The political environment consists of laws,

government agencies and pressure groups that influence and limit various

organisations and individuals in a given society. Companies Act 1956; Trade

and merchandise Act 1958;Essential commodities Act; Prevention of Food

Adulteration Act;


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CULTURAL

Society shapes our beliefs, values and norms. People absorb almost

unconsciously a worldview that defines their relationship to themselves, to

others, to organisations to society, to nature and to the universe. They must

market products that correspond to societys core and secondary values, and

address the needs of different subcultures.

Professor. V.SHEKHAR, Head, Dept. of Business Management, Osmania University


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MARKETING

MARKETING IS TYPICALLY SEEN ASTHE TASK OF CREATING, PROMOTING

AND DELIVERING GOODS (PHYSICAL)SERVICES (AIRLINES, HOTELS,BARBERS, LAWYERS,) - MANYMARKET OFFERINGS CONSIST OF AVARIABLE MIX OF GOODS ANDSERVICES. EVENTS(OLYMPICS,SPORTS) PERSONS

(CELEBRITY MARKETING) PLACES(CITIES,NATIONS) PROPERTIES(PHYSICAL /FINANCIAL),ORGANISATIONS (CORPORATEIMAGE), INFORMATION(EDUCATIONALINSTITUTIONS,MAGAZINES) AND

IDEAS(PRODUCTS AND SERVICES AREPLATFORMS FOR DELIVERING SOMEIDEA OR BENEFIT) TO CONSUMERSAND BUSINESSES.


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DEFINITION- MARKETING IS THEPROCESS OF PLANNING ANDEXECUTING THE CONCEPTION,

PRICING PROMOTION DISTRIBUTIONOF IDEA GOODS, SERVICES TOCREATE EXCHANGES THAT SATISFYINDIVIDUAL AND ORGANISATIONALGOALS.

EXCHANGE IS THE CORE CONCEPT OFMARKETING: FOR EXCHANGEPOTENTIAL TO EXIST, SOMECONDITIONS MUST BE SATISFIEDLIKE-

1.THERE ARE ATLEAST 2 PARTIES

2.EACH PARTY HAS SOMETHING THATMIGHT BE OF VALUE TO THE OTHERPARTY.

3.EACH PARTY IS CAPABLE OFCOMMUNICATION AND DELIVERY4.EACH PARTY IS FREE TO ACCEPT ORREJECT THE EXCHANGE OFFER

LEVELS OF COMPETITION:

1.BRAND COMPETITION MATIZ VSSANTRO


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2.INDUSTRY COMPETITION ALL CARMANUFACTURERS3.FORM COMPETITION ALL

AUTOMOBILE MANUFACTURERS3.GENERIC COMPETITION- ALLCOMPANIES THAT COMPETE AT THESAME RUPEE VALUE LIKE MAJORCONSUMER DURABLES, APARTMENTS.

MARKETING MIX

MARKETING MIX IS THE SET OFMARKETING TOOLS THAT THE FIRMUSE S TO PURSUE ITS MARKETINGOBJECTIVES IN THE TARGET MARKET.MCCARTHY CLASSIFIED THESE TOOLS

INTO FOUR BROAD MAJOR GROUPSTHAT HE CALLED AS 4 PS.

PRODUCT - SOLUTIONPRODUCT VARIETY, QUALITY, DESIGN,FEATURES, BRAND NAME,PACKAGING, SERVICES WARRANTIES,

PRICE - COST


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LIST PRICE, DISCOUNTS,ALLOWANCES, PAYMENT PERIOD,CREDIT TERMS ETC

PROMOTION - COMMUNICATIONSALES PROMOTION,ADVERTISEMENTS, SALES FORCE,PUBLIC RELATIONS, DIRECTMARKETINGPLACE - CONVENIENCE

CHANNELS, LOCATIONS, INVENTORY,TRANSPORT

MARKETING PHILOSOPHIES

PRODUCTION CONCEPT HOLDS THATCONSUMERS WILL PREFER PRODUCTSTHAT ARE WIDELY AVAILABLE ANDINEXPENSIVE.

PRODUCT CONCEPT- HOLDS THATCONSUMERS WILL FAVOUR THOSEPRODUCTS THAT OFFER THE MOSTQUALITY, PERFORMANCE ORINNOVATIVE FEATURES.


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SELLING CONCEPT HOLDS THATCONSUMERS AND BUSINESSES, IF

LEFT ALONE, WILL ORDINARY NOTBUY ENOUGH OF THEORGANISATIONS PRODUCTS ANDHENCE ORGANISTAIONS SHOULDUNDERTAKE AGGRESSIVE SELLINGAND PROMOTION EFFORT.

MARKETING CONCEPT- HOLDS THATTHE KEY TO ACHIEVING ITSORGANISATIONS GOALS CONSISTS OFTHE COMPANY BEING MOREEFFECTIVE THAN COMPETITION INCREATING , DELIVERING AND

COMMUNICATING CUSTOMER VALUETO ITS CHOSEN TARGET MARKETS.

FIND WANTS AND FILL THEMPUTTING PEOPLE FIRST BRITISHAIRWAYSLOVE THE CUSTOMER , NOT THEPRODUCT


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RELATIONSHIP MARKETING BUILDING LONG TERMRELATIONSHIPS.

MANAGING PRODUCT LINES ANDBRANDS

PRODUCT CLASSIFICATIONS-

1. NON- DURABLE GOODS- TANGIBLEGOODS NORMALLY CONSUMED INONE OR FEW USES- MANYLOCATIONS, HEAVY ADVERTISING,BUILD BRAND LOYALTY

2.DURABLE GOODS TANGIBLE

GOODS THAT NORMALLY SURVIVEMANY USES P

pre-ph.d. notes for marketing

Documents