Marketing
Identifying and meeting human and social needs profitably.
The organizational function and set of processes for creating, communicating and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders
Marketing is the societal process by which individuals and groups obtain what they need and want through creating, offering and freely exchanging products and services of value with others
Exchange and transactions
Exchange is the process of obtaining a desired product from someone by offering something in return
Conditions
1) There should be two parties
2) Each has something that the other values
3) Each party is capable of communication
4) Each party is free to accept or reject the exchange offer
5) Each believes that it is desirable to deal with the other part
Two parties negotiating are known as engaged in exchange, once an agreement is reached, we say a transaction take place.
Eight states of demand
Negative demand Consumer dislike the product and may pay a price to avoid it
Nonexistent demand Consumer are unaware or disinterested in the product
Latent demand Consumers have a need which cannot be satisfied by current products
Declining demand Consumer purchase less frequently/do not purchase at all
Irregular demand Consumers purchase on a seasonal, monthly, weekly etc basis
Full demand Product is adequately bought by consumer
Overfull demand More consumers want the product that can be satisfied
Unwholesome demand Consumers want products that have bad social consequences
Type of Markets
1) Consumer markets
2) Business markets
3) Global markets
4) Nonprofit and Government markets
Markets- New concepts
Market place and Market space: Place is physical while space is digital
Metamarkets Cluster of complementary products and services that are closely related in the minds of consumers but are spread across a diverse set of industries
Company Orientation towards the market place
1.Production concept
Principle: Consumers will prefer products that are widely available and inexpensive
These businesses concentrate on high production efficiency, low costs and mass distribution
2. Product concept
Principle: Consumers will favors products that offer the most quality, performance or innovative features
These organizations focus on making superior products and improving over time
Flip: Leads to Marketing Myopia – shortsightedness of the marketer – falling in love with one’s own product rather that understanding consumer needs
3. The Selling concept
Principle: The consumer, if left alone will not purchase, so the organization has to aggressively sell it to the consumer.
Insurance companies do it!!!
Such firms want to sell what they make rather than make what the market wants – risky business!!!
4. Marketing concept
Principle: The key to organizational goals consists of the company being more effective than competitors in creating, delivering and communicating superior customer value to its chosen target markets
Difference between Selling and Marketing
Selling focuses on needs of seller while marketing focuses on needs of buyer
Selling needs with the seller’s requirement to convert his product to cash while marketing deals with satisfying the needs of customer by the means of product
5. The holistic marketing concept
It is based on the development, design and implementation of marketing programs, processes and activities that recognises their breadth and interdependencies
Holistic marketing
It has four components
1) Relationship marketing
2) Integrated marketing
3) Internal marketing
4) Social responsibility marketing
Relationship marketing
It aims to build mutually satisfying long term relationships with key parties – customers, suppliers, distributors and other marketing partners – in order to earn retain their business
Relationship marketing consists of
CRM Customer relationship management
PRM Partner relationship management
The ultimate outcome of relationship marketing is a unique company called a marketing network
It consists of company and its supporting stakeholders(customers, employees, suppliers, distributors, retailers, ad agencies)
Integrated Marketing
The marketer’s task is to devise marketing activities and assemble fully integrated marketing programs to create, communicate and deliver value for consumers.
Here is where is the marketing mix comes in!
defined as the set of tools that firm uses to pursue its marketing objectives
Marketing Mix
McCarthy called it the 4 P’s
Product – Variety, Quality, Design, Features, Brand name, Warranties
Price – List price, Discounts, Credit period
Place – Channels, Transport, Coverage, Locations
Promotion – Sales promotion, Advertising, Sales force, Public relations, Direct marketing
4 Ps
Product- Customer solution
Price- Customer cost
Place- Convenience
Promotion- Communication
Internal Marketing
Internal marketing is the task of hiring, training and motivating employees to serve consumers well.
This takes place at two levels
1) Various marketing functions must work together
2) Marketing must be embraced by other departments as well
Social Responsibility marketing
Understanding broader concerns and the ethical, environmental, legal and social context of marketing activities and programs
It states that the organization’s task is to determine the needs, wants and interests of target markets and to deliver the desired satisfactions more effectively and efficiently than competitors in a way that preserves or enhances the consumer’s and society’s well being.
Core concepts of marketing
Needs Basic human requirements – hunger, thirst
Wants Specific objects that satisfy needs – Pepsi for thirst and Pizza for hunger
Demands wants for specific products backed by ability to buy and willingness to buy
Needs
1) 1.Stated needs – basic inexpensive thing
2) 2. Real needs – less operating cost or maintenance cost
3) 3. Unstated needs – good service
4) 4. Delight needs – certain special features
5) 5. Secret needs – status, smart
S-T-P
1) Segmentation
2) Targeting of markets
3) Positioning
Marketing Channels
Three types
1) Communication channels
2) Distribution channels
3) Service channels
Marketing Environment
Task environment – company, suppliers, distributors and customers
Broad environment – demographic, economic, physical, technological, political, legal, socio-cultural
