2. 2
Session 1:
What is Marketing Management
The Marketing Management Process
Business Orientation towards Marketing.
3. 3
Kotler & Drucker on Marketing
The future is not ahead of us. It has already
happened. Unfortunately, it is unequally
distributed among companies, industries and
nations
Peter Drucker:
The business enterprise only
has two basic functions:
marketing and innovation.
4. 4
Marketing & Exchange
What is marketing? Is marketing selling?
Marketing (Kotler, 1980):
Human activity directed as satisfying needs and
wants through exchange processes.
For exchange to occur, there must be:
Two parties
Each with something of value to the other
Capable of communication and delivery
Free to accept/reject the offer
Agreement to terms
See also transaction, barter, transfer, and behavioral
response
5. 5
Selling is only the tip of the iceberg
“There will always be need for
some selling. But the aim of marketing
is to make selling nonessential. The aim
of marketing is to know and understand
the customer so well that the product or
service fits him and sells itself. Ideally,
marketing should result in a customer
who is ready to buy. All that should be
needed is to make the product or
service available.”
Peter Drucker
6. 6
Marketing Management Process
Develop a marketing strategy
Market segmentation - positioning
Design marketing mix
Product / Service price channel promotion
Plan and implement
marketing programs
Forecast
sales and
contribution
Obtain
feedback
on results
Take into account
international
factors
Take into
account societal
concerns
Estimate
market
potential
Do a customer
analysis
Do a competitor
analysis
Adopt a marketing
philosophy
Develop a marketing strategy
Market segmentation - positioning
Design marketing mix
Product / Service price channel promotion
Plan and implement
marketing programs
Forecast
sales and
contribution
Obtain
feedback
on results
Take into account
international
factors
Take into
account societal
concerns
Estimate
market
potential
Do a customer
analysis
Do a competitor
analysis
Adopt a marketing
philosophy
7. 7
Who are Marketing Managers
and What Do They Do?
Marketing Managers
Anyone responsible for making significant
marketing decisions
Brand manager is charged with managing
and further developing the brand equity
Category manager coordinates the
marketing strategies of related products
and brands
8. 8
Simple Marketing System
A Market consists of all the potential customers
sharing a particular need or want who might
be willing & able to engage in exchange to
satisfy that need or want
10. 10
Organize by product units.
Focus on profitable transactions.
Look primarily at financial
scorecard.
Focus on shareholders
Marketing does the marketing
Build brands through advertising.
Focus on customer acquisition
No customer satisfaction
measurement
Over-promise, under-deliver
Organize by customer segments.
Focus on customer lifetime value
Look also at marketing scorecard
Focus on stakeholders
Everyone does the marketing
Build brands through behavior
Focus on customer retention and
growth
Measure customer satisfaction
and retention rate
Under-promise, over-deliver
Old Economy New Economy
Business Practices Changed:
11. 11
Business Orientations to the
Marketplace
1. Production concept: assumes consumers
favor those products that are widely
available and affordable. (Focus: wide
distribution; high volume).
2. Product concept: assumes consumers will
favor those products that offer the most
quality, performance, and features.
12. 12
Business Orientations to the
Marketplace
3. Selling concept: assumes that consumers
will either not buy or not but enough of the
organizations’ products unless the
organization makes a substantial effort to
stimulate the customer’s interest in the
product. (Focus: needs of the seller)
13. 13
Business Orientations to the
Marketplace
4. Marketing concept: holds that the key to
achieving organizational goals consists in
determining the needs and wants of target
markets and delivering the desired
satisfactions more effectively and efficiently
than competitors. (Focus: different needs of
buyers)
14. 14
Comparing
Selling & Marketing Concept
Starting Point Focus Means Ends
Factory Products Selling &
Promoting
Profits through
Sales volume
Target
Market
Customer
needs
Integrated
Marketing
Profits
through
Customer
Satisfaction
Marketing
Selling
Make-Sell Philosophy
Sense-Respond Philosophy
Right Customers for your products
Right Products for your customers
15. 15
Pillars for the Marketing Concept
The Marketing Concept
A business philosophy that the key to achieving
organizational goals is to determine the needs of
target markets and deliver the desired
merchandise more efficiently than competitors
Integrated
Company
Effort
Goal-directed
behavior (e.g.,
profit)
Customer
Orientation with
target markets
16. 16
Business Orientations to the
Marketplace
5. Societal marketing concept: [adds to the
marketing concept the words] … for the
objective of preserving and enhancing the
consumer’s and society’s well being.
(Focus: needs of buyers and society)
Current examples?
17. 17
Societal Marketing Concept
Marketing Managers Must Balance
Promote sale of
goods and services
Long-term needs for a
safe and healthy
environment
Profits
Public
Interest
20. 20
Relationship marketing: mutually satisfying
long-term relationships with key parties
(e.g., customers, suppliers).
Interdependence between buyer and seller
Repeated transactions
Database marketing
Interactive Marketing
Value of cooperation
Quality , delivery, and technical support become
important (in addition to price)
Relationship Marketing
22. 22
Integrated Marketing
Communications (IMC)
The coordination of the promotion mix
elements with each other and with other
elements of the brand’s marketing mix
such that all elements speak with one
voice.
23. 23
Five Key Features of IMC
1. Start with the customer or prospect.
2. Use any form of relevant contact.
3. Achieve synergy (speak with a single voice).
4. Build relationships.
5. Affect behavior.
25. 25
Core Concepts
Needs, wants, and
demands
Target markets, positioning,
segmentation
Offerings and brands
Value and satisfaction
Marketing channels
Supply chain
Competition
Marketing environment
Marketing planning
26. 26
Marketing Core Concepts
Need: basic human requirements; a state of felt
deprivation; Do marketers “create needs”??
Want: a specific object that can satisfy a need
Demands: wants for specific products backed by
an ability to pay
Product, Offering, and Brand (offering from a
known source)
Value proposition: a set of benefits to satisfy
needs
27. 27
Marketing Core Concepts
Marketing Channels (communication,
distribution, service)
Supply Chain (raw materials -> final buyers)
Competition (brand, product, form --supplying
the same need, generic – competition for
same $$ in an area)
29. 29
Theodore Levitt’s
“Marketing Myopia”
What are business leaders myopic about?
Four self-deceiving conditions causing firms
to believe that they are in a growth industry:
1. Expanding and more affluent population
2. No competitive substitutes
3. Mass production and declining unit costs
4. Preoccupation with the product
