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Introduction to marketing

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This is an introduction to the basic concepts of marketing

This is an introduction to the basic concepts of marketing

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  • I had been arguing about market with my wife since last Tuesday but since I found: How the markets really work, I do find your point of view quite interesting and, in this case specifically, quite useful.
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  • 1. Marketing Management - 1
    • Rajeev Roy
  • 2. What is ‘Marketing’?
    • Marketing is an organisational function and a set of processes for creating, communicating and delivering value to customers and for managing customer relationships in ways that benefit the organisation and its stakeholders
    • Marketing is a 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.
  • 3. Marketing vs Sales
    • Peter Drucker
    • “ The aim of marketing is to make sales superfluous”
  • 4. Marketing vs Sales
    • Marketing is a more comprehensive process
    • Sales – focus on needs of Seller
    • Marketing – focus on needs of buyer
    • Selling has a short term outlook.. Marketing has a long term vision
  • 5. Importance of Marketing
    • According to the Customer Service Institute, it costs as much as five times as much to acquire a new customer than it does to service an existing one.
    • Customers tell twice as many people about a bad experience over a good one.
    • For an average company, 65% of its business comes from its presently satisfied customers.
  • 6. Marketing Myopia
    • There is no ‘growth’ industry
    • Belief that growth is assured by an expanding and affluent population
    • Belief that there is no competitive substitute for the industry’s major product
    • Too much faith in mass production
    • Preoccupation with the product and with R&D
  • 7. Demand
    • Negative Demand
    • Non-existent Demand
    • Latent Demand
    • Declining Demand
    • Irregular Demand
    • Full Demand
    • Overfull Demand
    • Unwholesome Demand
  • 8.
    • Needs
    • Wants
    • Demand
  • 9.
    • Segmentation
    • Targeting
    • Positioning
  • 10. Marketing Product Customer Solution Price Cost Place Convenience Promotion Communication 4 Ps 4 Cs
  • 11. 5 C's
    • Customer (customer needs, segments, consumer behavior)
    • Company Skills (brand name, image, production capability, financial strengths, organization, etc.)
    • Competition (actions are interrelated, market environment)
    • Collaborators (downstream wholesalers or retailers, upstream suppliers)
    • Context (culture, politics, regulations, social norms)
  • 12. Changes
    • Marketing Department to Marketing Organisation
    • Focus on Product Unit to focus on Segments
    • Working with fewer suppliers
    • Emphasis on intangible assets
    • Online interactions
    • Market share vs share of wallet
    • Glocal
    • Stakeholders vs Shareholders
  • 13. Marketing Challenges
    • The danger of 1P marketing
    • Training
    • Getting reliable/useful customer info
    • Low cost, high quality competition
    • Power of distributors/retailers
    • Measuring impact of marketing
  • 14. Marketing Sins
    • The firm is not sufficiently market-focused or customer-driven
    • The firm does not fully understand its target customers
    • The firm needs to better define its competitors and monitor them
    • The firm is not good at finding new opportunities
    • The firm has not managed well its relationship with stakeholders
  • 15. Cont..
    • The firm’s market plans and planning processes are deficient
    • The firm’s products need tightening
    • Weak brand building and communication
    • The firm is not well organised to carry on marketing
    • Lacking in use of technology
  • 16. Core Competency
    • It is a source of competitive advantage
    • It has an application in a wide variety of markets
    • It is difficult for competitors to emulate
  • 17. Porter’s Generic Strategies
    • Overall Cost Leadership
    • Differentiation
    • Focus
  • 18. SWOT
  • 19. SWOT
    • Only accept precise, verifiable statements
    • Ruthlessly prune long lists of factors, and prioritize factors so that you spend your time thinking about the most significant factors.
    • Apply it at the right level - for example, at product or product line level, rather than at the much vaguer whole company level.
    • Supplement it with other option-generation tools - none is likely to be completely comprehensive.
  • 20. STEP
    • Socio-Cultural
    • Technological
    • Economic
    • Political / Legal
    • Natural
  • 21. Porter’s Five Forces
  • 22. Supplier Power
    • The market is dominated by a few large suppliers
    • There are no substitutes for the particular input,
    • The suppliers customers are fragmented
    • The switching costs from one supplier to another are high,
    • There is the possibility of the supplier integrating forward
    • The buying industry hinders the supplying industry in their development
    • The buying industry has low barriers to entry.
  • 23. Customer Power
    • They buy large volumes,
    • There is a concentration of buyers,
    • The supplying industry comprises a large number of small operators
    • The supplying industry operates with high fixed costs
    • The product is undifferentiated
    • Switching to an alternative product is relatively simple
    • Customers have low margins and are price-sensitive,
    • Customers could produce the product themselves,
    • The product is not of strategic importance for the customer,
    • There is the possibility for the customer integrating backwards.
  • 24. Entry Barriers
    • Economies of scale
    • High initial investments and fixed costs,
    • Cost advantages of existing players due to experience curve
    • Brand loyalty of customers
    • Protected intellectual property like patents, licenses etc,
    • Scarcity of important resources, e.g. qualified expert staff
    • Distribution channels are controlled by existing players,
    • Existing players have close customer relations
    • High switching costs for customers
    • Legislation and government action 
  • 25. Competitive Rivalry
    • There are many players of about the same size,
    • Players have similar strategies
    • There is not much differentiation between players and their products, hence, there is much price competition
    • Low market growth rates (growth of a particular company is possible only at the expense of a competitor),
    • Barriers for exit are high