Marketing is a societal process by which individuals and group obtain what they
need and want through creating, offering and freely exchanging , products and servicesof
values with others.
Acc. To A.M.A.
Marketing is a process of planning and executing the conception, pricing,
promotion and distribution of ideas , goods and services to create exchange that satisfy
individuals and organizational goals
In the early 1960s, Professor Neil Borden at Harvard Business School identified a
number of company performance actions that can influence the consumer decision to
purchase goods or services.
Borden suggested that all those actions of the company represented a “Marketing
Professor E. Jerome McCarthy, also at the Harvard Business School in the early
1960s, suggested that the Marketing Mix contained 4 elements: product, price, place and
Marketing mix is the set of marketing tool the firm uses to pursue its marketing
objectives in target market.
The four Ps are:
Product: The product aspects of marketing deal with the specifications of the
actual goods or services, and how it relates to the end-user's needs and wants. The scope
of a product generally includes supporting elements such as
Size and services
warranties, guarantees, and returns
This refers to the process of setting a price for a product, including discounts. The price
need not be monetary - it can simply be what is exchanged for the product or services,
e.g. time, energy, psychology or attention. Eg.
This includes -
It refers to how the product gets to the customer; for example, point of sale placement or
retailing. This fourth P has also sometimes been called Place, referring to the channel by
which a product or services is sold. Ex.-
Four New Ps
Personalization: It is here referred customization of products and services
through the use of the Internet. Early examples include Dell on-line and Amazon.com,
Participation: This is to allow the customer to participate in what the brand
should stand for; what should be the product directions and even which ads to run.
Peer-to-Peer: This refers to customer networks and communities where advocacy
happens. The historical problem with marketing is that it is “interruptive” in nature,
trying to impose a brand on the customer.
Predictive modeling: This refers to algorithms that are being successfully applied
in marketing problems (both a regression as well as a classification problem).
Marketing Mix Strategy
Concepts of Marketing
Exchange of a product between the seller and the buyer.
It is a significant part of Marketing, However, Marketing in itself a broader term.
Exchange comprise distribution aspects and price mechanism, which is most vital
in transaction. However, value satisfaction, creative selling are out of the context of
Marketing depends upon production, whatever is being produced, that only to sell.
In this concept production is superior i.e. ‘Marketing can be managed by
Believes the volume of production followed by low cost attracts customer.
Marketing is best acknowledged and succeed with best product attributes.
Concept is based on customer’s preference to high quality product.
Aggressive promotion and push its products.
Heavy advertising, high-power personal selling, large-scale promotion, public
relations the main tools used by organization.
Marketing Myopia is found in this concept too.
Shift in Orientation
Production Orientation to Marketing Orientation
Product Orientation to Customer Orientation
Supply Orientation to demand Orientation
Sales Orientation to satisfaction Orientation
Internal Orientation to External Orientation
Comparisons between various concepts
Integrated Management, with Marketing as the Fulcrum
Realization of all organizational goals, including profits
It is a form of marketing developed from direct response marketing campaigns
conducted in the 1960's and 1980's which emphasizes customer retention and continual
satisfaction rather than individual transactions and per-case customer resolution.
Relationship marketing differs from other forms of marketing in that it targets an
audience with more directly suited information on products or services which suit
retained customer's interests, as opposed to direct marketing, which focuses upon
acquisition of new clients by targeting majority demographics based upon prospective
According to Leonard Berry relationship marketing can be applied when there
are alternatives to choose from; when the customer makes the selection decision; and
when there is an ongoing and periodic desire for the product or service.
A key principle of relationship market is the retention of customers through
varying means and practices to ensure repeated trade from preexisting customers by
satisfying requirements above those of competing companies through a mutually
Relationship marketers speak of the "relationship ladder of customer loyalty".
It is the systematic application of marketing along with other concepts and
techniques to achieve specific behavioral goals for a social good.
Social marketing can be applied to promote, for example, merit goods, make the
society avoid demerit goods and thus to promote that considers society's well being as a
This may include asking people not to smoke in public areas, for example, ask
them to use seat belts, prompting to make them follow speed limits.
social marketing has two parents - a 'social parent' = social sciences and social
policy, and a 'marketing parent' = commercial and public sector marketing approaches.
Eight Essential Components Of Social Marketing
A consumer orientation to realize organizational (social) goals
An emphasis on the voluntary exchanges of goods and services between providers
Research in audience analysis and segmentation strategies
The use of formative research in product and message design and the pretesting of
An analysis of distribution (or communication) channels
Use of the marketing mix- utilizing and blending product, price, place and
promotion characteristics in intervention planning and implementation
A process tracking system with both integrative and control functions
A management process that involves problem analysis, planning, implementation
and feedback functions
Customer Relationship Management
It is a combination of philosophies, polices and strategies connecting different
players within an organization so as to coordinate their efforts in creating an overall
valuable series of experiences, products and services for the customer.
It is a term applied to processes implemented by a company to handle their
contact with their customers.
CRM software is used to support these processes, storing information on
customers and prospective customers. Information in the system can be accessed and
entered by employees in different departments, such as sales & personnel.
Details on any customer contacts can also be stored in the system.
The rationale behind this approach is to improve services provided directly to
customers and to use the information in the system for targeted marketing and sales
Types of CRM
Sales Intelligence CRM
Value Chain Analysis
Michael Porter gave this concept in his two books.
He proposed that every activity performed by the firm create some value
reflecting product & services thereby creating value chain.
Whole business is observed as single unified chain meant to deliver value to the
Comparisons are made between close competitors.
Value Delivery Process
It paves the way for production, sales, promotion
Value Creation/Value Delivery
Successful execution of firm’s promise
Additional benefits are associated
Value Communication-Info to customer
feedback is followed by search of new expectations.
Ex: Standard Chartered offers Global credit cards while rest offer country specific
cards, ABN Amro offers several facilities on savings A/C
Management Task future growth of business.
Decisions leading to effective strategies for timely accomplishment of goals.
Rapid changes make it necessary
Ensure optimum utilization of resources which in turn make the production and
product cost & quality competitive.
Concern of Strategic Planning
Direction of Growth
Extent of Growth
Pace of Growth
Timing of Growth
Business & Marketing Integration
Long-term sustainable organizational design
Components of Strategic Planning
Establishing the Organizational long-term goals.
Defining business for every business.
Understanding of internal/external environment.
Formulation of Corporate strategy
Followed by comprehensive marketing Plan
It is a written document that details the necessary actions to achieve one or more
It can be for a product or service, a brand, or a product line.
Marketing plans cover between one and five years.
A marketing plan may be part of an overall business plan. Solid marketing
strategy is the foundation of a well-written marketing plan.
Content of the marketing plan
A marketing plan for a small business typically includes Small Business
Administration Description of competitors, including the level of demand for the product
or service and the strengths and weaknesses of competitors.
The brief contents of marketing plan are:
Description of the product or service, including special features
Marketing budget, including the advertising and promotional plan
Description of the business location, including advantages and disadvantages for
Medium-sized and large organizations
Opportunities / Issue Analysis - SWOT
Action Programme (the operational marketing plan itself for the period under
Marketing Research is the research on manifolds problems of Marketing.
It is systematic gathering of information, presentation and interpretation of the
It aims to accomplish marketing goals of the organization.
It is complex but functional science study about consumer, competitiors and
To provide data analysis about consumer, market, demand.
To predict the trends of competition in market.
To assess the change in market scenario.
To chalk out right pricing strategy.
To select aqnd approve the methods of advertising & promotion.
Primary & Secondary Research
Research using own objective and fresh data at initial source is called primary
research or empirical study.
Research based on available data but using fresh objective is called secondary
Both are found in marketing.
Formulating the problem
Determining the research design
Preparation for the field work
Implementing the field work
Process the data
Tabulation and analysis
Prepare the report
Types of MR
Uses of MR
Filling in the gaps in knowledge
Concept identification and exploration
Identify relevant behaviour patterns
Identify attitudes, beliefs, opinions
To shortlist options where a large no. of options exist
Assessing comprehension, likeability, memory of business communication
Limitations of MR
It is not an exact science
Appreciation of the fact that there would be a difference from test conditions to
MR depends on responses. This can change depending on test conditions.
Validation is a problem. Element of subjectivity.
Biases can creep in owing to lesser skill of the MR team
Inadequate preparation and analysis can lead to erroneous conclusions
Lack of motivation due to MR not being appreciated by many companies
Formulating the problem
What is the marketing problem?
Translate it to the research problem
Primary & Secondary Data
Other sources of secondary data collection.
Retail Shop Panels
Advertising Audience Panels
Results and discussion
Consumer Buying Behavior
Distinct characteristics of purchase decision-making in the contexts of
professional consumer services and organizational and consumer buying.
Three aspects: the factors involved, the purchase-decision task, and the nature of
the decision-making process.
Professional consumer services represents a unique setting for purchase decision-
making and cannot be considered equivalent to the organizational or consumer setting.
Buyer behaviour is focused upon the needs of individuals, groups and
organisations We begin at the bottom level.
Physiological needs such as food, air, water, heat, and the basic necessities of
survival need to be satisfied. At the level of safety, man has a place to live that protects
him from the elements and predators. At the third level we meet our social and
belongingness needs i.e. we marry, or join groups of friends, etc.
The final two levels are esteem and self-actualisation. Fewer people satisfy the
higher level needs. Esteem means that you achieve something that makes you recognized
and gives personal satisfaction, for example writing a book. Self-actualisation is achieved
by few. Here a person is one of a small number to actually do something. For example,
Neil Armstrong self-actualised as the first person to reach the Moon.
Buyer Decision Process
The marketing mix inputs (four P's price, place, promotion, and product) are
adapted and focused upon the consumer
The psychology of each individual considers the product or service on offer in
relation to their own culture, attitude, previous learning, and personal perception
The consumer then decides whether or not to purchase, where to purchase, the
brand that he or she prefers, and other choices.
Conceptual Model of Sustainable Consumer Behavior
Industrial Buying Process
Steps in Industrial Buying Process
Assignment of buying authority
Evaluation and selection
Step 1 Problem Recognition
What is the need?
Who has the need?
Step 2 Assignment of Buying Authority
Who knows the most about the product
Who has the problem
Who is in the position of responsibility
Step 3 Search Procedures
Locate the product
Other purchasing agents
Advertisements in journals, web
Develop a rating system for selection
Step 4 Evaluate and Select
Most specs met
Influences in Industrial Buying
Product / Purchase Influences
Organizational / Structural Influences
Identifying those particular groups of customers which your product/service is
capable of meeting their requirements (needs) most.
Each of these groups constitute a market segment
Selecting one or more segments to enter
Establishing and communicating the product’s key distinctive benefits in that
A large identifiable group within a market with similar wants, purchasing power,
geographical locations, buying attitudes
What is an attractive niche ?
A distinct set of needs
A premium can be charged
Not likely to attract competition
Gains certain economies through specialisation
Sufficient size, profit and growth potential
When the marketing mix is altered to suit the local conditions
eg. Giving a higher/ lower discount than what’s prevailing in the rest of the markets
or implementing a different promotion scheme
When the firm deals with each customer on a one – to – one basis
When products are customised for the customer
Especially for new innovative creations.
Follows change of the fashion such as Yoga and diet management, herbal
marketing, marketing for best suited healthy life style with eco-friendly methods.
Bases for Segmentation
Geographic –territory demarcations
Demographic – age, family size,sex, income,education, religion, etc.
Psychographic – lifestyle,personality,values
Behavioral – knowledge,attitudes,usage
Occasions – birthdays, lunchtime,vacations
Benefits – eg.travel – business, vacation, educational
User status – non users, ex users, first time users, regular users, potential users
Usage rate – light, medium, heavy
Loyalty status – diehards,shifters,switchers
Buyer Readiness – unaware – aware – informed – interested – desire – intention
Attitude – enthusiastic, positive, indifferent, negative, hostile
Criteria for segmentation
Single segment concentration
Full Market coverage -
Single product addressing all segments with a single marketing program.
Mass production is possible giving scale economies
Pushes price downwards enabling to attract price sensitive segments
A separate market offering for every segment
Marketing programs for every segment could be different
Pushes up costs at various levels, necessitating sufficient volumes for viability
Generates inter-segment rivalry
Most competitive advantages lasts only a short time. Companies therefore
constantly need to think up new value adding features and benefits to win the attention
and interest of choice rich, price prone consumers.
It is the act of designing a set of meaningful differences to distinguish the
company’s offering from competitors.
How can you differentiate?
Differentiation can be done in various ways depending on the industry and
Differentiation can occur in one or more of these areas – product, services,
personnel, channel, image.
Ordering Ease,Delivery,Installation,Customer Training,Maintenance and
Identity – what the company wants to project
Image – what the public perceive
Image can be enhanced by using, symbols, media, atmosphere, events and
• Differentiation must be meaningful and relevant to the consumer. So it should
satisfy the following criteria
This should be exclusive to the product and make a significant relevant impact to
The act of designing the company’s offering and image to occupy a distinctive
place in the consumer’s mind.
Positioning normally takes one position in the mind. More than one, the company
runs the risk of customer credibility and dilution of positioning
Use or application
PLC(Product Life Cycle)
Products have a limited life
Product sales pass through distinct stages
Profits rise and fall at different stages of the PLC
Product require different strategies in each stage of the PLC
Stages in PLC
Market Pioneering Stage
Market Growth Stage
Market Maturity Stage
Market Decline Stage
PLC Operates at three Levels
The Product Level
The Product-Sub Category Level
The Brand Level
Factors affecting each stage
Application of Innovation
New Product Launch
Brand existence and loyalty
Product Tailoring such as assembling, vendors at a place, Product’s Association
with other products for offer.
Nature and competitiveness of product.
Quality and Brand competitiveness.
Type of producer-Innovator/Me Too
Modification followed by promotion
Expenditure on advertisement
Less opportunities of innovation.
Non-Price Competition prevails.
Huge expenditure with falling revenue.
Cut-throat competition forces product to withdraw.
Taste, Fashion, Needs, Lifestyle & Preferences of consumers.
Product life cycle:------
Product management is critical
Products are the life blood of the company
A common, holistic methodology is needed to view product life cycles from
Product management is part of a company’s business model
Product management is not just about the job of a product manager
Stages in New Product Development
Generating New Product Ideas
Estimating the demand for New Products
End Use Method
Pricing-No pattern Pricing; skimming/penetration pricing
Market Test/Test Marketing
Conjoint analysis – to find out the best valued attributes by consumers
Denote Range & Variety of the products.
Complete set of all products for sale.
Width of PM-no of Product line carried
Length - No of items/brands in line.
Depth – No of items in each brand
1. Reliance operates in mobile, petroleum, agri-retail (width), in Mobile range such as
type of moile service (length), various types of sets for particular service (depth)
2. HLL-Bath Soaps, Fabric Wash, Beverages (width), Rexona, Lux, Dove (Length),
three colours and varieties of Lux (depth)
Stages in Product Development
Decision for No of Product line that can be accomodated by firm.
Decision for various inter or intra product line composition.
Product Differentiation, distinction & positioning.
Creating brand and managing the brands
Appraisal of each product line and product/brand depth
Line stretching, line filling, brand pruning.
Managing product quality.
Strategies - Introduction
Skimming the market
Penetrating the market
Must have sufficient resources to withstand the initial losses and heavy promotion
Incremental selling efforts at this stage is highest
The competitive cycle
Strategies - Growth
Improves quality and adds features
Adds new models and variants
Enters new market segments
Increases distribution coverage and adds new channels
Shifts communication from awareness to preference building
Scale economies enable it to lower prices to attract the next level of price
Strategies - Maturity
Most products are in this stage
Price wars are inevitable.
Scramble for market share
The fittest survive
Market modification, product modification, marketing mix modification can help
extend the maturity stage
Strategies - Decline
Rationalisation of products
Pioneer increases share
Harvesting whatever is possible
Divesting the product
Target return pricing
Perceived value pricing
Going rate pricing
Sealed bid pricing
It is used to lessen the impact of the actual pricing in the consumers mind
It is used as a surrogate to indicate the product quality or esteem
New methods of Pricing
Gain and Risk sharing pricing
Different pricing at different locations
Could be in terms of barter, countertrade and foreign currency
Loss leader pricing
Special event pricing
Low interest financing
Longer payment terms
Warranties and service contracts
Product Mix Pricing
Product line pricing
Optional feature pricing
Captive product pricing
Two part pricing
Product bundling pricing
Patterns of Channels.
Design a Channel System
Identifying Channel Power
Issues of Channel Conflicts
Creating & Administering the Channel
Selection of Dealer/Retailer and other links
Specific Channel for Multi-Level Marketing
Setting Channel Objectives & Strategy
Incorporating change of business environment
Break the Bulk & cater to tiny requirements.
Help in Price Mechanism
Assist in Merchandizing
Act as change agent and generate demand
Take care of flows involved in distribution
Look after a physical distribution & financing.
Provide in Salesmanship
Helps in Price Mechanism
Each Distinctive tier of intermediaries is referred to as levels
Each link is referred to as Channel member
No of levels determines the length of channel.
Types of Marketing Intermediaries
Value Added Dealers
Value Added Resellers
C & F Agents
Designing Channel Systems
Establishing Channel Objectives
Channel Objective will decide Channel Design Ex: HLL Lifebuoy for 80 percent
village objective changed whole channel design
Channel objective depends on firm Ex: Reliance, NTC, Bombay Dyeing have
different set of channel design.
Designing Channel Systems
Identifying channel objectives
Find suitability of channel design for product
Evaluation of channel environment
Choice of Channel Intensity
Choice of Number of tiers
Selection of variant within a given design
Establishment of unified system
Establishment by Bottom up Method
Fixing number of members
Acknowledgement of contemporary channel scenario
THE COMMUNICATION PROCESS
Marketing Communications mix
Sender Encoding Message
PR and Publicity
Each of these has its own uses and limitations and hence a judicious mix is employed
by most companies.
Integrated Marketing Communications
This brings about synergy and better use of communication funds
Balancing the ‘push’ and ‘pull’ strategies
Improves the company’s ability to reach the right consumer at the right place at
the right time with the right message.
Distortions in Communication
Factors influencing effectiveness of communications
when the recipient’s source of communication is single
When message is in line with recipients opinions and beliefs
When issues are unfamiliar or peripheral issues
When the source is an expert, of high status, likeable, has power and can be
When social context or reference group will mediate the communication and
The hierarchy of effects model
The innovation – adoption model
The Hierarchy of Effects model
The Innovation Adoption model
Depending on the attitudes of the consumer, the communication will either get a +ve ,
neutral or -ve response depending on what attitudes the consumer has of the endorser
The message has to be considered depending on which media is going to be used
– eg. Layouts, props, models, music, voice, etc.
Personal – Direct selling
Non Personal – media, atmosphere, events
What is Advertising?
It is any paid form of non – personal presentation and promotion of ideas, goods,
services by an identified sponsor.
The 5 Ms of Advertising
Mission – objectives
Money – budgets
Message – communication
Media – what vehicles?
Measurement - evaluation
A specific communication task to be achieved to a specific degree to be
communicated to a specific target audience in a specific period of time.
Covering written matter, pictures, labels, logo & designs
Stages in Copy Development-Fact Finding Stage and Idea finding stage
How much to spend?
‘Half my advertising is wasted, but the trouble is I do not know which half
- John Wanamaker
How much to spend?
Depends on the product
What stage in the PLC
Market share and the consumer base
Competition and clutter
The most cost effective media mix to ensure achievement of the advertising goal.
How should you select media?
No. of persons exposed to a particular media schedule at least once during a
specified time period
No. of times within the specified period that a person is exposed to that message
Qualitative value of an exposure through a given medium
GRP (Gross rating points) = R * F
Wt. GRP = R * F * I
Whereas advertising gives a reason to buy, SP gives an incentive to buy
Advantages of SP
To reward loyal customers
To induce stocking by the trade
Adjust to short term variations in trade
Disadvantages of SP
With too many promotion schemes ‘promotion clutter’ confuses consumers
Attracts ‘brand switchers’ and ‘deal prone’ customers
Dilutes brand equity
Preponement of purchases
Expensive and wasteful, when not handled properly
Types of SP
Developing a SP campaign
Planning the programme
Incentive to be given
Implementing and controlling
Involves a variety of programmes to promote or protect a company’s image or
Functions of PR
Assisting in new product launches
Assisting in repositioning of product
Building interest in product category
Influencing specific target groups
Defending products that have encountered public problems
Building corporate image that rubs off on the products
Advantages of MPR
Stimulate sales force and dealers
Holds down promotion costs
The bottom line
PR is difficult to measure, but if consistently pursued with, it can have
tremendous synergy with advertising and sales promotion, thereby reducing overall