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Marketing management by Govind Kumar
- 1. Marketing Management The MarketingConcept Dr. Govind Kumar (Ph.D.) Assistant Professor FCM, Rama University Kanpur MBA II Sem (2015-16)
- 2. Marketing marketing is theprocess of planning and executing the conceptions, pricing, promotion, and distribution of ideas, goods, and services, to create exchanges that satisfy individual and organizational goals. Marketing Management Marketing management is the art and science of choosing target markets and getting, keeping, and growing customers through creating, delivering, and communicating superior customer value.
- 3. The holistic marketingconcept is based on the development, design, and implementation of marketing programs, processes and activities that recognizes their breadth and interdependencies. Holistic marketing recognizes that “everything matters” with marketing-and that a broad, integrated perspective is often necessary. There are four components of holistic marketing are relationship marketing, integrated marketing, internal marketing, and social responsibility marketing Holistic Marketing Concept
- 4. Holistic Marketing Dimension Holistic Marketing Internal Marketing Integrated Marketing Relationship Marketing Socially Responsible Marketing MarketingDepartment Senior Management Other Departments Communication Product & Services Channels Customers Channels Partner Ethics Environment Legal Community
- 5. Components of MarketingMix Marketing Mix Product Price Place Promotion Product Variety Quality Design Features Brand Name Packaging Sizes Services Warranties Returns List Price Discounts Allowances Payment Period Credit Terms Sales Promotion Advertising Sales Force Public Relations Direct Marketing Channels Coverage Locations Inventory Transport 4Ps Given by McCarthy
- 6. Relation Between 4Ps& 4Cs 4Ps Product Price Place Promotion 4Cs Customer Solution Customer Cost Convenience Communication RobertLauterbornsuggestedthatthesellers’four Pscorrespondtothecustomers’fourCs.
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- 8. Core Concept ofMarketing A core set of concepts creates a foundation for marketing management and a holistic marketing orientation. Needs, Wants, and Demands: Needs are the basic human requirements. People need food, air, water, clothing, and shelter (security) to survive. People also have strong needs for recreation, education, and entertainment. These above needs become wants when they are directed to specific objects that might satisfy the need. An American needs food buy may want a hamburger, French fries and a soft drink. Demands are wants for specific products backed by an ability to pay. Many people want a Mercedes; only a few are willing and able to buy one. Company measures not only how many people want their product but also how many would actually be willing and able to buy it.
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- 10. From a managerialpoint of view, marketing is the process of planning and executing the conceptions, pricing, promotion, and distribution of ideas, goods, and services, to create exchanges that satisfy individual and organizational goals. Marketing management is the art and science of choosing target markets and getting, keeping, and growing customers through creating, delivering, and communicating superior customer value. Marketing management has experienced a number of shifts in recent years as companies seek marketing excellence. The set of tasks necessary for successful marketing management includes developing marketing strategies and plans, connecting with customers, building strong brands, shaping the market offerings, delivering and communicating value, capturing marketing insights and performance, and creating successful long-term growth.
- 11. C C DV T P Creating Communicating Delivering Value TargetMarket Profit
- 12. Summing up alltogether, every company must focus on both micro and macro environmental forces in order to build successful marketing strategy for rapid growth and to achieve predefined organizational goals. This can only be met when an organization have through knowledge of global marketing environment.
- 13. Objective and Goal Setting AssessingYour Current Situation Writing the Plan and Strategy Implementing and Managing Your Plan 1 2 3 4
- 14. Jobber (2007) definesit as a "system in which marketing data is formally gathered, stored, analyzed and distributed to managers in accordance with their informational needs on a regular basis." Kotler, at al, (2006) "an overall Marketing Information System can be defined as a set structure of procedures and methods for the regular, planned collection, analysis and presentation of information for use in making marketing decisions."
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- 16. Consumer behavior asthe behavior that consumers display in searching for, purchasing, using, evaluating, and disposing/ordering of products and services that they expect will satisfy their needs. Consumer behavior focuses on how individual consumers and families or households make decisions to spend their available resources (time, money, effort) on consumption-related items. CB includes what they buy, why they buy it, when they buy it, where they buy it, how often they buy it, how often they use it, how they evaluate it after the purchase, the impact of such evaluation on future purchases, and how they dispose of it.
- 17. Consumer behavior describestwo different kinds of consuming entities: the personal consumer and the organizational consumer. Personal Consumer: They buys goods and services for his/her own use, for the use of the household, or as a gift for a friend. Organizational Consumer: Includes profit and non-profit businesses, government agencies (local, state & national), and institutions (e.g. schools, hospitals, and prisons), which must buy products, equipment, and services in order to run their organizations.
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- 23. Market Segment: A marketsegment consists of a group of customers who share a similar set of needs and wants. Market segmentation is a marketing strategy which involves dividing a broad target market into subsets of consumers, businesses, or countries that have, or are perceived to have, common needs, interests, and priorities, and then designing and implementing strategies to target them.
- 24. Market Segments canbe defined in many different ways. One way to carve up a market is to identify the same preference segments. For Instance- Suppose ice cream buyers are asked how much they value sweetness and creaminess as two product attributes. Three different patterns can emerge. Homogeneous Preference Diffused Preference Clustered Preference
- 27. Segmentation Geographic Segmentation Demographic Segmentation Psychographic Segmentation Behavioral Segmentation Countries Nations States Regions Cities Life Style Personality Age Family Size FamilyLife Cycle Gender Income Occupation Education Religion Social Class Occasions Benefits User Status Usage Rate Loyalty Status Attitudes towards Products
- 28. Key Points toRemember: Target marketing involves three activities: market segmentation, market targeting, and market positioning. Markets can be targeted at four levels: segments, niche, local area and individuals. Market segments are large, identifiable, groups, within a market. There are two bases for segmenting consumer markets: consumer characteristics and consumer response. To be useful, market segments must be measurable, substantial, accessible, differentiable, and actionable. Marketer must choose target markets in a socially responsible manner.
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- 36. A product mixalso called product assortment is the set of all products and items a particular sellers offers for sale. A product mix consists of various product lines. A company’s product mix has a certain width, length, depth and consistency. Width- The width of a product mix refers to how many different product lines the company carries. Length- The length of a product mix refers to the number of items in the mix. Depth- A width a product mix refers to how many variants are offered of each product in the line. Consistency- The consistency of the product mix refers to how closely related the various product lines are in end use, production requirements, distribution channels, or some other way.
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- 39. P P PP P Marketers play a key role in the new-product process by identifying and evaluating new-product ideas and working with R&D and others in every stage of development.
- 40. Idea Generation Idea Screening ConceptDevelopment & Testing Marketing Strategy Development Business Analysis Product Development Marketing Testing Commercialization Drop Accept
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- 43. Characteristics Introduction GrowthMaturity Decline Sales Low Rising Peak Declining Costs High Cost Average Cost Low Cast Low Cost Profits Negative Rising High Declining Customers Innovators Early Adopters Middle Majority Laggards Competitors Few Growing Stable No beginning to decline Declining Marketing Objectives Create P Awareness Max Market Share Max Profit Reduce Expenditure Strategies Products Offer a basic Product Offer Product Extensions Diversity Brands & Items Models Phase out weak Price Change cost-plus Price to Penetrate Market Price to match or best competitors Cut price Distribution Build selective Dis. Build intensive Distribution Build more int. distribution Go selective Advertising Build product awareness Build awareness & interest in mass mkt. Stress brand difference & benefits Reduce to level needed Sales Promotion Use heavy sales promotion Reduce to take advantage of heavy customer demand Increase to encourage brand switching Reduce to minimal level
- 44. Summary of theLesson: Each stage of the product life cycle calls for different marketing strategies. The introduction stage is marked by slow growth and minimal profits. If successful, the product enters a growth stage marked by rapid sales growth and increasing profits. There follows a maturity stage in which sales growth slows and profits stabilize. Finally, the product enters a decline stage. The companies' task is to identify the weak products; develop a strategy for each one; and phase out weak products in a way that minimizes the hardship to company profits, employees and customers.
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- 54. Why Packaging SoImportant: Customers are drawn, more than anything, to products that look good. Something that is well designed and interesting is bound to attract more potential customers than a product that is poorly designed and looks bland. It is, after all, the key part in marketing product and ensuring it sells. It is also the key part in associating a brand to a certain thing- be it a color or a font . Packaging Design: Where it Begins: A good design should always reflex the product and the creativity and personality of the company. There is more, however, to packaging design than simply ensuring a package looks appealing.
- 56. Intangible products suchas accounting, banking, cleaning, consultancy, education, insurance, expertise, medical treatment, or transportation. Sometimes services are difficult to identify because they are closely associated with a good; such as the combination of a diagnosis with the administration of a medicine. No transfer of possession or ownership takes place when services are sold, and they (1) cannot be stored or transported, (2) are instantly perishable, and (3) come into existence at the time they are bought and consumed.
- 58. Three Types ofMarketing in Service Industry
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- 62. Price is notjust a number on a tag or an item: Price is all around us. You pay rent for your apartment, tuition for your education, and a fee to your physician or dentist. The airline, railway, taxi, and bus companies charge you a fare; the local utilities call their price rate; and the local bank charges you interest for the money you borrow.
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- 64. Cost based Pricing Demand based Pricing Competition based Pricing Other Pricing Method Cost –PlusPricing Markup Pricing Value Pricing Target Return Pricing Going Rate Pricing Transfer Pricing
- 65. 1. Cost BasedPricing refers to a pricing method in which some percentage of desired profit margins is added to the cost of the product to obtain the final price. In other words, cost based pricing can be defined as a pricing method in which a certain percentage of the total cost of production is added to the cost of the product to determine its selling price.
- 66. (a) Cost PlusPricing: Refers to the simplest method of determining the price of a product. In cost plus pricing method, a fixed percentage, also called markup percentage, of the total cost (as a profit) is added to the total cost to set the price. For example, XYZ organization bears the total cost of Rs. 100 per unit for producing a product. It adds Rs. 50 per unit to the price of product as’ profit. In such a case, the final price of a product of the organization would be Rs. 150.
- 67. (b) Markup Pricing:Refers to a pricing method in which the fixed amount or the percentage of cost of the product is added to product’s price to get the selling price of the product. Markup pricing is more common in retailing in which a retailer sells the product to earn profit. For example, if a retailer has taken a product from the wholesaler for Rs. 100, then he/she might add up a markup of Rs. 20 to gain profit.
- 68. 2. Demand BasedPricing: Demand based pricing refers to a pricing method in which the price of a product is finalized according to its demand. If the demand of a product is more, an organization prefers to set high prices for products to gain profit; whereas, if the demand of a product is less, the low prices are charged to attract the customers.
- 69. 3. Competition BasedPricing refers to a method in which an organization considers the prices of competitors’ products to set the prices of its own products. The organization may charge higher, lower, or equal prices as compared to the prices of its competitors.
- 70. 4. Other PricingMethod i. Value Pricing: Implies a method in which an organization tries to win loyal customers by charging low prices for their high quality products. The organization aims to become a low cost producer without sacrificing the quality. It can deliver high quality products at low.
- 71. Many companies areintent on developing stronger bonds with their customers- called CRM. This is the process of managing detailed information about individual customers and carefully managing all customer “touch points” to maximize customer loyalty. A customer touch point is any occasion on which a customer encounters the brand and product-from actual experience to personal or mass communications to casual observation.
- 72. CRM…. Continue… Some of thegroundwork for customer relationship management was laid by Don Peppers and Martha Rogers in a series of books. Peppers and Rogers outline a four-step framework for one-to-one marketing that can be adapted to CRM marketing as follows- A. Identify your prospects and customers B. Differentiate customers in terms of (1) their needs and (2) their value to your company. C. Interact with individual customers to improve your knowledge about their individual needs and to build stronger relationships. D. Customize products, services and messages to each customer.
- 75. Mass Marketing *Average Customer *CustomerAnonymity *Standard Product *Mass Production *Mass Distribution *Mass Advertising *Mass Promotion *One-Way Message *Economies of Scale *Share of Market *All Customers *Customer Attraction One-to-One Marketing *Individual Customer *Customer Profile *Customized Mkt Offering *Customized Production *Individualized Distribution *Individualized Message *Individualized Incentives *Two-Way Messages *Economies of Scope *Share of Customer *Profitable Customers *Customer Retention
- 77. GREEN MARKETING Here, term‘green’ is indicative of purity. Green means pure in quality and fair or just in dealing. For example, green advertising means advertising without adverse impact on society. Green message means matured and neutral facts, free from exaggeration or ambiguity. Green marketing is highly debated topic for lay people to highly professional groups.
- 78. Concept of greenmarketing concerns with protection of ecological environment. Excessive pollution has provoked the Nature and the Nature starts behaving in unnatural ways (in form of global warming v/s global cooling, heavy rains v/s draught, and other natural calamities like frequent earthquakes and tsunami, cyclones, epidemics, and so forth). Economic growth via production and consumption threatens peaceful life of human being on the earth. Green marketing is an attempt to protect consumer welfare and environment (the nature) through production, consumption, and disposal of eco-friendly products.
- 79. Definition of GreenMarketing: “The marketing or promotion of a product based on its environment performance or an improvement thereof (Charter & Polonsky, 1999)” The holistic management process responsible for identifying and satisfying the requirements of customers and society, in a profitable and sustainable way 9Peattie, 1995)
- 80. Basically, green marketingconcerns with three aspects: 1. Promotion of production and consummation of pure/quality products, 2. Fair and just dealing with customers and society, and 3. Protection of ecological environment.
- 81. Impacts or Importanceof Green Marketing: Green marketing affects positively the health of people and the ecological environment. People are aware of pure products and pure methods of producing, using, and disposing the products. It encourages integrated efforts for purity in production and consumption as well. Environmental Benefits Consumer Benefits Product benefits Developing Economies
- 82. Reasons Why companiesto adopt Green Marketing: Opportunities or competitive advantage. Corporate social responsibilities (CSR). Government pressure. Competitive pressure. Cost or profit issues. Challenges in Green Marketing: Majority of the people are not aware of Green products and their uses. Green products require a recyclable and renewable materials or elements which are expensive. People are often perceived that green products are expensive compared to traditional products. Green Marketing depends on technology and requires a huge investment in Research and Development.
- 83. Green Marketing Mix Thecombination of 4 Green P‟s or Green factors(Eco-friendly) is known as Green Marketing Mix. GMM Green Product Green Price Green Place Green Promotion
- 84. SN Company Activities 1 PhilipsIndia Energy saving Lights, Medical Equipments, House hold appliances 2 Go GreenBOV Battery Operated Vehicles(BOV) 3 Philips Compact Fluorescent Light (CFL) bulbs 4 Hewlett-Packard Company Energy-efficient products and services and institute energy-efficient operating practices in its facilities worldwide. 5 Wipro Technologies Sustainable IT products and solutions, which help customers, achieve high productivity in energy, space and asset management through the lifecycle. Recycled plastic. Launched Green ware ranges of desktops are not only 100% recyclable, but also toxin-free. 6 CISCO Systems Cisco is planning to minimize the ecological impact by establishing responsible operation programs aimed to reduce energy consumption 7 Infosys Technologies Ltd. Focused on green buildings, water harvesting and conservation, better transport management by encouraging car pool for its employees and increasing bio-diversity in its campuses. Company Involved in Green Marketing
- 85. Showing Countries rankedaccording to their response level on Green Marketing SN Countries 1 India 2 UK 3 US 4 Australia 5 Canada 6 China
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- 90. Electronic commerce, commonlywritten as ecommerce, is the trading or facilitation of trading in products or services using computer networks, such as the Internet. Electronic commerce draws on technologies such as mobile commerce, electronic funds transfer, supply chain management, Internet marketing, online transaction processing, electronic data interchange (EDI), inventory management systems, and automated data collection systems. Modern electronic commerce typically uses the World Wide Web for at least one part of the transaction’s life-cycle, although it may also use other technologies such as e-mail.
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- 104. Marketing Channel Successful valuecreation needs successful value delivery. Holistic marketers are increasingly taking a value network view of their business. Instead of limiting their focus to their immediate suppliers, distributors, and customers, they are examining the whole supply chain that links raw materials, components, and manufactured goods and shows how they move toward the final consumers.
- 105. Most producers donot sell their goods directly to final users. Between producers and final users stands one or more marketing channels, a host of marketing intermediaries performing a variety of functions. Marketing channels decisions are among the most critical decisions facing management. The company's chosen channels profoundly affects all other marketing decisions. Companies use intermediaries when they lack the financial resources to carry out direct marketing, when direct marketing is not feasible, and when they can earn more by doing so. The most important functions performed by intermediaries are information, promotion, negotiation, ordering, financing, risk taking, physical procession, payment etc.
- 106. Manufacturers have manyalternatives for reaching a market. They can sell direct or use one-two-,or three-level channels, deciding which types of channel to use calls for analyzing customer needs, establishing channels objectives and identifying and evaluating the major alternatives, including the types and numbers of intermediaries involved in the channels. Effective channel management calls for selecting intermediaries and training and motivating them. The goal is to build a long-term partnership that will be profitable for all channel members. Marketing channels are characterized by continuous and sometimes dramatic change.
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