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Introduction of-marketing-management-and-rest-for-exam

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  • Core Concepts This CTR corresponds to Figure 1-1 on p. 4 and relates to the discussion on pp. 3-10. Also to the CTRs numbers 4 - 8 which follow. Core Concepts Needs. These emerge from a state of felt deprivation. Ask students to distinguish among physical, social, and individual needs. Wants . These are the form taken by human needs as they are shaped by culture and individual experience. Have students provide examples for different wants based upon geographical differences, gender, age, wealth. Link culture to socio-economic standing, education. Demands . These are wants backed by buying power. Discuss such popular items as dream vacations or favorite cars to illustrate the difference between wants and demands. You may want an Acura Legend but drive a Subaru Justy. Introduce the idea that demands are often for a bundle or group of benefits and may address a number of related needs and wants. Products . These are anything offered for sale to satisfy a need or want. Have students discuss an extended view of products to include services and ideas. Discuss the role of value in distinguishing products. Discussion Note: Ask students to identify their product choice set for cars, vacations, dating partners, or college professors. Exchanges . These are the act of obtaining desired objects by offering something in return. Link to barter economies and promises to pay (i.e., credit, checks). Transactions. These are an actual trade of value between at least two parties. Transaction marketing is part of the larger concept of relationship marketing in which parties build long-term, economic ties to enhance quality and customer-delivered value. Markets . These are the set of actual and potential buyers of a product. Markets may be decentralized or centralized. Markets exist wherever something of value is desired, such as in the labor market, the money market, even the donor market - for human “products” such as blood or organs.
  • Transcript

    • 1. Marketing A Philosophy An Attitude A Perspective A Management Orientation A Set of Activities 1
    • 2. The Purpose of Marketing • To understand the Needs & Wants of Customers • To create customer value through satisfaction and loyalty • To operate more effectively and efficiently than competitors • To increase the value of the organization 2
    • 3. Core Marketing ConceptsCore Marketing Concepts Products, Services, Experiences Value and satisfaction Needs, wants, and demands Exchange, transactions, and relationships Markets Core Marketing Concepts Core Marketing Concepts 3
    • 4. Marketing Management Process Marketing Management Process• Stage 1: Identifying marketing opportunities or problems. – Understand major environmental forces that create both opportunities and threats. • Stage 2: Market Segmentation, targeting, and positioning. – : Identify the most promising segment (s) and consider how to satisfy the customers that have homogeneous needs within each segment. • Stage 3: Understanding the customers. – Design a new product by understanding potential customers’ needs and purchasing patterns. • Stage 4: Developing a marketing mix. – Design a competitive marketing strategy by blending product, price, promotion, and place strategies. • Stage 5: Managing the marketing efforts. – Measure and evaluate the performances of current marketing strategy. 4
    • 5. Evolution of Business Models and the role of Marketing Marketing Product varietySellingProduction As business philosophy has evolved, so hasAs business philosophy has evolved, so has the role of marketing…customer satisfactionthe role of marketing…customer satisfaction is now at the coreis now at the core As business philosophy has evolved, so hasAs business philosophy has evolved, so has the role of marketing…customer satisfactionthe role of marketing…customer satisfaction is now at the coreis now at the core 5
    • 6. Product Orientation vs. Market Orientation Company Product Market Indian Railways We run rail services We are a people- and-goods mover Xerox We make copying equipment We improve office productivity Standard Oil We sell gasoline We supply energy Columbia Pictures We make movies We entertain people 6
    • 7. The Marketing Concept itself has evolved from.. 1) Catering to the customer1) Catering to the customer1) Catering to the customer1) Catering to the customer 2) Anticipating the customer2) Anticipating the customer2) Anticipating the customer2) Anticipating the customer 3) Fulfilling the customer3) Fulfilling the customer3) Fulfilling the customer3) Fulfilling the customer 7
    • 8. 9
    • 9. Old vs New marketing Challenges for Marketing in 21st century Speed ?….Outrun….? 10
    • 10. 11
    • 11. Some New-Age Marketing Trends • Relationship Marketing • Database Marketing • Network Marketing • Permission or Interruption marketing • Viral Marketing • Ambush Marketing 12
    • 12. So…Marketing is managing.. Connecting withConnecting with CustomersCustomers Technology Relationships GlobalAlliances Diverse Demands Ethics 13
    • 13. Fundamental Goals of MarketingFundamental Goals of Marketing • Goal 1: Attracting Customers: – Attract new customers by promising superior value and create transactions with them. – known as the leaky bucket approach. • Goal 2: Retaining and Growing Customers: – Satisfied customers are more likely to be loyal customers, and loyal customers are more likely to give the company a larger share of their business in the long run. – Retention strategy: Retain current customers for maintaining profitable long-term relationships with them by delivering superior value and customer satisfaction. Has this changed ? ?? 14
    • 14. What is marketing all about? 15
    • 15. 16
    • 16. Stakeholder Management- beyond marketing 17
    • 17. What is sustainability? 18
    • 18. Why is it important to achieve both satisfaction and loyalty? 19
    • 19. Satisfaction is a person’s feelings of pleasure or disappointment resulting from comparing a product’s perceived performance (or outcome) in relation to his or her expectations. 20
    • 20. Satisfaction & Loyalty Outcomes: – Sales to increase revenues – Less price sensitivity – Lower organization’s costs Satisfaction: Feelings from experience Loyalty: Choice of brand over others 21
    • 21. Value and Satisfaction:Value and Satisfaction: – Customers choose a product that provides the maximum perceived value among many marketing offers. • Customer perceived value = total benefits – total costs. • Total benefits: product features, services, information, and experiential values. • Total costs: monetary, time, and psychological costs. 22
    • 22. Determinants of Customer Delivered Value Image valueImage value Personnel valuePersonnel value Services valueServices value Product valueProduct value Total customer value Total customer value Monetary costMonetary cost Time costTime cost Energy costEnergy cost Psychic costPsychic cost Total customer cost Total customer cost Customer delivered value Customer delivered value 23
    • 23. Customers Front-line people Middle Management Top Management Traditional Organization Chart 24
    • 24. Customer-Oriented Organization Chart Customers Front-line people Middle management Top manage- ment C ustom ers C ustom ers 25
    • 25. Inactive or ex-customers Customer Development PartnersAdvocatesClients Repeat customers First-time customers Suspects Prospects Disqualified prospects 26
    • 26. Marketing Strategy 27
    • 27. Margin Margin The Generic Value Chain Primary Activities Support Activities Procurement Serv- ice Technology Development Human resource management Firm infrastructure Inbound Logistics Opera- tions Out- bound Logistics Market- ing and sales 28
    • 28. Market-Oriented Strategic Planning Objectives Skills Resources Opportunities Profit and Growth 29
    • 29. Growth Strategies: Ansoff’s Product/Market Expansion Grid 4. Diversification 2. Market development New markets 1. Market penetration Existing markets Existing products 3. Product development New products
    • 30. Marketing Environment What is ? How to analyze? For what? 31
    • 31. Actors in the Microenvironment
    • 32. The Company’s Macroenvironment
    • 33. Economic Factors • Inflation • Employment • Disposable income • Business cycles • Energy availability and cost • Others?
    • 34. Technological Factors • New discoveries and innovations • Speed of technology transfer • Rates of obsolescence • Internet; Mobile ; Cloud and Information processing technology –Platforms and Portability –Copy/Clone
    • 35. Political/legal Factors • Monopolies legislation • Environmental protection laws • Taxation policy • Employment laws • Government policy • Legislation • Others?
    • 36. Political Environment Includes Laws, Government Agencies, and Pressure Groups that Influence or Limit Various Organizations and Individuals In a Given Society. Increasing Legislation Changing Government Agency Enforcement Increased Emphasis on Ethics & Socially Responsible Actions
    • 37. Sociocultural factors • Demographics • Distribution of income • Social mobility • Lifestyle changes • Consumerism • Levels of education
    • 38. The Cultural EnvironmentThe Cultural Environment institutions and other forces that affect a society’s basic values, perceptions, preferences, and behaviors. • Core beliefs are persistent – Passed from parents to children; reinforced by society – Shape attitudes and behavior • Secondary cultural values change and shift more easily • Society’s cultural values are expressed through people’s views of: – Themselves – Others – Organizations – Society – Nature – The Universe
    • 39. The Marketing Environment and Competitor Analysis • Five forces analysis • SWOT analysis
    • 40. Threat of substitutes Potential entrants Threat of entrants Suppliers Bargaining power Substitutes Buyers Bargaining power COMPETITIVE RIVALRY Porter’s Five forces analysis
    • 41. Five Forces Analysis: Key Questions and Implications • What are the key forces at work in the competitive environment? • Are there underlying forces driving competitive forces? • Will competitive forces change? • What are the strengths and weaknesses of competitors in relation to the competitive forces? • Can competitive strategy influence competitive forces (eg by building barriers to entry or reducing competitive rivalry)?
    • 42. Responding to the Marketing Environment • Reactive: Passive Acceptance and Adaptation; Avoidance • Proactive: Environmental Management and New Product Development
    • 43. Customer/Product Profitability Analysis
    • 44. Consumer Behaviour An Introduction
    • 45. What is Consumer Behaviour? Those activities directly involved in obtaining , consuming and disposing of products and services, including the decision processes that precede and follow these actions
    • 46. Consumer Characteristics… Take- Away • CB is influenced by consumer characteristics – Individual chars (Personality, Lifestyle) – Environment (Reference Groups, Culture) • Important to take these variables into account in your marketing plan – introvert/extrovert: • Also important to keep track of trends… – E.g., lifestyle trends (McDonald’s) • Culture: Important because of global marketing – Localization vs. Standardization?? – Flexible Globalization is often the solution (McDonald’s)
    • 47. Perspectives of CB Logical Positivism 1. Understanding and predicting consumer behaviour 2. Cause and effect relationships that govern persuasion and/or education Post Modern – to understand consumption behaviour without any attempt to influence it
    • 48. 7 O FRAMEWORK eg purchase of soap
    • 49. 50 Firm’s Marketing Efforts 1. Product 2. Promotion 3. Price 4. Channels of distribution Sociocultural Environment 1. Family 2. Informal sources 3. Other noncommercial sources 4. Social class 5. Subculture and culture Output Process Input ExternalInfluenceConsumerDecisionMaking Post-Decision Behavior Post purchase Evaluation Purchase 1. Trial 2. Repeat purchase Need Recognition Prepurchase Search Evaluation of Alternatives Psychological Field 1. Motivation 2. Perception 3. Learning 4. Personality 5. Attitudes Experience A Model of Consumer Decision Making
    • 50. Decision Issues • Types of decisions – Routinized response (e.g., gas, sodas) – Limited problem solving (e.g., car service, fast food) – Extended problem solving (e.g., new car, computer, medical procedures) • Type of evaluation: – Compensatory: Decision based on overall value of alternatives (good attribute can outweigh bad ones) – Non-compensatory: Absolutely must meet at least one important criterion (e.g., car must have automatic transmission)
    • 51. Potential Family Life Cycle Stages YOUNG SINGLE BLENDED SINGLE PARENT FULL NEST I/II/III EMPTY NEST I/II OLDER SINGLE YOUNG COUPLE
    • 52. Household Decision Making • Roles/influence – Information gatherers/holders – Influencers – Decision makers – Purchasers – Users
    • 53. Adoption Process 1. Awareness 2. Interest 3. Evaluation 4. Trial 5. Decision 6. Confirmation
    • 54. Organizational Buyers • Types – Industrial – Reseller – Government and non- profit organizations • Characteristics – Greater involvement – Bureaucracy – Long term relationships
    • 55. Organizational decision making v/s Consumer decision making • Purchase decisions made by companies frequently involve many people • Organizational and industrial products are often bought according to precise, technical specifications that require a lot of knowledge about the product category. • Impulse buying is rare because buyers are professionals, their decisions are based on past experience and a careful weighing of alternatives. • Decisions often are risky, especially in the sense that a buyer´s career may be riding on his demonstration of good judgment. • The business-to-business marketing often involves more of an emphasis on personal selling than on advertising or other forms of promotion.
    • 56. MODELS OF ORGANIZATIONAL BUYING BEHAVIOR To gain a simplified view to organizational buying behaviour for a practical use, there are several models to handle the complex environment. The following introduces four major groups first conceptualized by Rowland T. Moriarty : • Task oriented model • Non task oriented model • Decision process model • Complex model
    • 57. three types of buying decisions: • Straight rebuy- Purchasing department reorders on a regular basis. The buyer chooses from suppliers on an approved list. The suppliers make an effort to maintain product and service quality and propose “automatic reordering systems”. The “out-suppliers” attempt to offer something new or exploit dissatisfaction with existing supplier. • Modified rebuy- The buyer wants to modify product specifications, prices, delivery requirements and other terms. This involves additional decision participants on both sides. The “in-suppliers” become nervous and “out-suppliers” try to offer a better deal. • New task- The purchaser buys a product or service for the first time.
    • 58. MARKET SEGMENTATION
    • 59. • CONCEPT AND DEFINITION The concept of market segment is based on the fact that the market of commodities are not homogeneous but they are heterogeneous. Market represent a group of customer having common characteristics but two customer are never common in their nature, habits, hobbies income and purchasing techniques.
    • 60. • According to Philip kotler , “ Market segmentation is sub-dividing a market into distinct and homogeneous subgroups of customers, where any group can conceivably be selected as a target market to be met with distinct marketing mix.”
    • 61. • Market Segmentation is a method of “dividing a market (Large) into smaller groupings of consumers or organisations in which each segment has a common characteristic such as needs or behaviour.”
    • 62. DEFINITIONS • MARKET SEGMENTATION: Customer oriented -- identifies customer subgroups of the market as they currently exist. • PRODUCT DIFFERENTIATION: Product oriented -- identifies subgroups of competing products.
    • 63. RULE OF MARKET SEGMENTATION • Maximize homogeneity within market segments • Maximize heterogeneity between market segments
    • 64. Why you need customer segments • Customers are usually very different • College students, senior citizens, families with children, empty nesters… • The same message to all may not work so well. • Solution: create segments, and design a program for each segment.
    • 65. A valid segment strategy involves: • Communications to the segment (direct mail, email, on-location personal attention) • Rewards designed to modify behavior • Controls to measure the success of the strategy • A budget for implementation of the strategy • Specific goals and metrics for engagement: for behavior modification • An organization that accepts responsibility for the segment
    • 66. LEVELS OF MARKET SEGMENTATION
    • 67. 1. SEGMENT MARKETING Consists of a group of customers who share a similar set of needs and wants. Identifiable Group with in a Market with Similar • Wants • Purchasing Power • Geographical Location • Buying Attitudes
    • 68. FLEXIBLE MARKET OFFERING • Even in segments 100 % needs are not same – consists of two parts 1.Naked Solution :- products and services that all members of the segment values. 2.Discretionary options :- that some segment members value. Each option might carry an additional charge.  Example: Automobile industry – basic model is same but for A.C , power steering, power window buyer
    • 69. has to pay extra price.  Delta Airlines offers all economy passengers a seat and soft drinks. It charges economy passengers extra for alcoholic beverages.
    • 70.  Market Segments can be defined in many different ways. One way to carve up a market is to identify Preference segments Suppose ice cream buyers are asked how much they value sweetness and creaminess as two product attributes. Three different patterns can emerge.
    • 71. Homogeneous preference : – where all the consumer have roughly the same preferences. – We would predict that existing brand would be similar and cluster around the middle of the scale in both sweetness and creaminess. Diffused preference : – consumers vary greatly in their preferences Clustered preference :
    • 72. creaminess sweetness Homogeneous Preference -no natural segments -all buyers have same preference
    • 73. creaminess sweetness Diffused Preference -no pattern (…or poor research) -take center position
    • 74. creaminess sweetness Clustered Preference -natural segments -increases as number of competitors increases
    • 75. 2. NICHE MARKETING  Group of customers seeking a distinctive mix of benefits who are ready to pay extra premium.  Niche = segment sub – segments Eg. Washing detergents hard & gentle washes . Surf excel for tough stains ( hard on clothes) & Ezee from Godrej for delicate clothes. --- Astha , Sanskar , Q TV – focus on religion & spiritualism.  DISTINCT NEEDS  PAY PREMIUM  SPECIALIZATION  LESS COMPETITION  POTENTIAL
    • 76. 3. LOCAL MARKETING • Marketing programs tailored to the needs & wants of local customer groups in trading areas, neighborhoods , etc. • this trend is called grass roots marketing. Ex. – Spiderman 3 was released in 5 different language in India including bhojpuri. Chitle Pune sarees Kashmiri silk
    • 77. 4. INDIVIDUAL MARKETING • Ultimate segmentation – segments of 1 or customized marketing or one to one marketing. • Customerization – empower the consumers to design the product or service offering of their choice. • Ex. Paint companies have started doing this- Asian Paint , Nerolac , Berger Paints • Arvind mills launched Ruff’n Tuff Jeans, branded ready – to – stitch
    • 78. GEOGRAPHIC SEGMENTATION Divide the market into different group based on : • Region – South India , North , Western Region, East • City – metro cities, cities with population more than 1 million • World • Density • Climate • States Ex.- Mcdonalds globally, sell burgers aimed at local markets, for example, burgers are made from lamb in India rather then beef because of religious issues. In Mexico more chilli sauce is added and so on.
    • 79. DEMOGRAPHIC SEGMENTATION
    • 80. Segment Strategy
    • 81. An ideal segment… • Has definable characteristics in terms of behavior and demographics: for example, Retired Couples • Is large enough in terms of potential sales to justify a custom marketing strategy with appropriate rewards and budget • Has members who can be motivated by cost effective rewards to modify their behavior in ways that are profitable for your company • Makes efficient use of available data to support segment definition and marketing efforts • Can be measured in performance, with control groups • Justifies an organization devoted to it: can be a single person, or part of a person’s time, but there should be someone who “owns” each segment.
    • 82. Segment action plan: • A roadmap showing what will happen when. “Send each policyholder a birthday card and a policy review 45 days before their policy renewal date.” • A budget for the infrastructure and for the segment marketing plans • An organization chart that shows who is responsible for each segment • Specific goals to be achieved with milestones for measurement of success
    • 83. BASES FOR SEGMENTING MARKETS CONSUMER: • Geographic • Demographic (age, income, marital, occupation, ethnicity, etc. • Psychographic (AIO, lifestyles) • Behavioral (occasions, user status, usage rate, loyalty status, hierarchy of needs) • Benefits BUSINESS TO BUSINESS: • Demographic (industry, size, location) • Customer Variables (technology, user/nonuser, loyalty status) • Purchasing(centralized/decentral ized, functional orientation, contracts vs. bids vs. lease) • Situational (urgency, order size, product application)
    • 84. PSYCHOGRAPHIC SEGMENTATION
    • 85. BEHAVIOURAL SEGMENTATION
    • 86.  OCCASIONS - Archies and Hallmark cards, Monaco at tea time.  BENEFITS – Shampoo for hair conditioning, cleaning , hair fall defence dandruff control  USER STATUS- light – medium – heavy user  LOYALTY STATUS- hardcore loyal , split loyal- loyal to 2-3 brand ,shifting loyal, switcher
    • 87. PSYCHOGRAPHIC SEGMENTATION • Actualizers (taste, finer things) • Fulfilleds (functionability, value, durability) • Believers (established products/brands) • Achievers (visibility to peers) • Strivers (emulation) • Experiencers (experiential consumption) • Makers (basic practical possessions) • Strugglers (urgent basic needs)