Presentation on theme: "Unit 1 Introduction to Marketing. Marketing….. defined The Chartered Institute of Marketing define marketing as 'The management process responsible for."— Presentation transcript:
Unit 1 Introduction to Marketing
Marketing….. defined The Chartered Institute of Marketing define marketing as 'The management process responsible for identifying, anticipating and satisfying customer requirements profitably'
Marketing….. defined Philip Kotler defines marketing as 'satisfying needs and wants through an exchange process'
Marketing….. defined P.Tailor of suggests that 'Marketing is not only about providing products or services it is essentially about providing changing benefits to the changing needs and demands of the customer
Marketing….. defined Several experts argue that Marketing is the management process responsible for identifying, anticipating and satisfying customers’ requirements profitably
What is Marketing? Marketing is all about – - Identifying the need of the customer and developing product accordingly - Spreading awareness /creation of need - Building relationships with the customers - Ensuring maximum customer satisfaction
The Extended Marketing Mix Product Price Place Promotion People Process Physical evidence
Marketing mix Product Product development Product management Product features and benefits Branding Packaging After-sales services
Marketing mix Price Costs Profitability Value for money Competitiveness Incentives Quality Status
The Production Concept This concept holds the notion that a customer will prefer a product that is easily available and affordable. The main task that has to be performed by the marketing manager is to see that the production is done a mass scale and the goods are available easily.
Product Concept The product concept holds the notion that a customer will prefer those products that are of supreme quality. Therefore, the main task of any marketing manager is improve the quality of the product at every stage of production process. Under this concept, the companies are so focused in improving the quality of their products that they don’t pay attention on what the customer needs.
Product Concept An excess focus on the product and not on the customers leads to “Marketing Myopia” amongst the companies. Marketing Myopia is dangerous because it does not allows the companies to explore more effective and efficient ways of serving the customers needs.
Selling Concept Many organizations follow the selling concept, which holds that consumers will not buy enough of the organization's products unless it undertakes a large scale selling and promotion effort. Their aim is to sell what they make rather than make what the market wants. Such an effort carriers high risks
Selling Concept It focuses on creating sales transactions rather than on building long-term, profitable relationships with customers. It assumes that customers who are convinced to buy a product will like it. Or if they don't like it, they will possibly forget disappointment and buy it again later.
Marketing Concept Under this concept, the customer needs are discovered and all the efforts are devoted to satisfy the need of the customers. A company practicing this concept achieves the corporate objectives by meeting the customer needs in an efficient way than its competitors. All the initiatives are taken to provide customer satisfaction and establish a long term relationship with the customers.
Societal Marketing Concept The societal marketing concept is an enlightened marketing concept that holds that a company should make good marketing decisions by considering consumers' wants, the company's requirements, and society's long-term interests. It is closely linked with the principles of corporate social responsibility.
Societal Marketing Concept Most companies recognize that socially responsible activities improve their image among customers, stockholders, the financial community, and other relevant publics. Ethical and socially responsible practices are simply good business, resulting not only in favorable image, but ultimately in increased sales.
Marketing Environment All the surroundings that can affect the working of an organization comprises of the marketing environment. There are two key perspectives on the marketing environment, namely the 'internal environment‘ and the external environment
Internal Environment All factors that are internal to the organization are known as the 'internal environment'. They are generally audited by applying the 'Five Ms' which are Men, Money, Machinery, Materials and Markets. The internal environment is as important for managing change in an organization. The internal factors are, more or less, under the control of the management.
External Environment All those factors that are outside the organization and are,more or less, uncontrollable for the management are known as external environmental factors. For example Political, economic, social and technological factors belongs to the external environment. The external environment can be audited in more detail using other approaches such as SWOT Analysis and PEST Analysis.
PEST Analysis Political factors Economic factors Social factors Technological factors
Market Segmentation Market segmentation is the identification of portions of the market that are different from one another. Segmentation allows the firm to better satisfy the needs of its potential customers. The marketing concept calls for understanding customers and satisfying their needs better than the competition. Therefore, for different customer, the concept of segmentation helps in understanding the needs.
Basis for segmentation 1) Geographic Segmentation The following are some examples of geographic variables often used in segmentation. Region: by continent, country, state, or even neighborhood Size of metropolitan area: segmented according to size of population Population density: often classified as urban, suburban, or rural
Basis for segmentation 2) Demographic Segmentation Some demographic segmentation variables include: Age Gender Income Occupation Education Religion
Basis for segmentation 3) Psychographic Segmentation Psychographic segmentation can be done on the basis of AIO- Attitude Interests Opinions
Basis for segmentation 4) Behavioralistic Segmentation Behavioral segmentation is based on actual customer behavior toward products. It include: Benefits sought Usage rate Brand loyalty User status: potential, first-time, regular, etc. Occasions: holidays and events that stimulate purchases
Targeting After the market has been separated into its segments, the marketer will select a segment or series of segments and 'target' them. The first is the single segment with a single product. In other word, the marketer targets a single product offering at a single segment in a market with many segments. For example, British Airway's Concorde is a high value product aimed specifically at business people and tourists willing to pay more for speed.
Targeting Secondly the marketer could ignore the differences in the segments, and choose to aim a single product at all segments i.e. the whole market. This is typical in 'mass marketing'. An example of this is the approach taken by budget airlines such as Go. Finally there is a multi-segment approach. Here a marketer will target a variety of different segments with a series of differentiated products. This is typical in the motor industry
Positioning Positioning has come to mean the process by which marketers try to create an image or identity in the minds of their target market for its product, brand, or organization. Positioning is all about 'perception'. As perception differs from person to person, so do the results of the positioning. For example, what you perceive as quality, value for money, etc, is different to my perception. However, there might be similarities as well.
Positioning Brand Positioning - Brand Positioning can be defined as an activity of creating a brand offer in such a manner that it occupies a distinctive place and value in the target customer’s mind According to Scott Davis, a company should change its positioning in every 3 – 5 years For example – -Kotak Mahindra – “Think investment, think Kotak” -Wal-Mart- “Always low prices, Always….” -Big Bazaar- “Isse sasta aur acha aur kahin nahin” -Tata- ”Improving the quality of life”
Positioning of Liril Liril was positioned on the freshness platform right from its birth. The girl and the waterfall with the unique jingle ensured that the freshness is experienced by the audience. Liril can be called as an experiential brand and the communication perfectly supported that. Liril did not change its positioning for 25 years although the models changed, the brand communication was consistent.
Positioning of Dominos Dominos Pizza have positioned them selves in the minds of the consumers as “fast home delivery of pizza under 30 minutes”. Because of this “Pizza Hut” has become the place to go and eat pizza but “Dominos” is what you think of when you think home delivery of pizza. This is what positioning is all about. Finding a place in the customers head.
Positioning Strategies POSITIONING BY PRODUCT ATTRIBUTES AND BENEFITS - Ariel that offers a specific benefit of cleaning even the dirtiest of clothes because of the micro cleaning system in the product. - Colgate offers benefits of preventing cavity and fresh breath. - Maruti Suzuki offers benefits of maximum fuel efficiency and safety over its competitors.
Positioning Strategies POSITIONING BY PRICE/ QUALITY - Parle Bisleri – “Bada Bisleri, same price” - Vishal Megamart – value retailer - Wal-Mart – “Always low prices, always”
Positioning Strategies POSITIONING BY COMPETITOR - Onida was positioned against the giants in the television industry through this strategy, ONIDA colour TV was launched with the message that all others were clones and only Onida was the leader. “neighbor's Envy, Owners Pride”. - Rin V/S Tide controversy
Repositioning a Brand Brand Repositioning is changing the positioning of a brand. A particular positioning statement may not work with a brand. Re-positioning involves changing the identity of a product, relative to the identity of competing products, in the collective minds of the target market.
Repositioning a Brand For instance, Dettol toilet soap was positioned as a beauty soap initially. This was not in line with its core values. Dettol, the parent brand (anti-septic liquid) was known for its ability to heal cuts and gashes. The extension's 'beauty' positioning was not in tune with the parent’s “germ-kill” positioning. The soap, therefore, had to be repositioned as a “germ-kill” soap (“bath for grimy occasions'') and it fared extremely well after repositioning. Here, the soap had to be repositioned for image mismatch. There are several other reasons for repositioning. Often falling or stagnant sales is responsible for repositioning exercises.
Repositioning a Brand Maharaja - the positioning: Dishwasher in its initial Stages was possibly seen as an exotic product. Thus, Maharaja positioned it as a product aimed at the upper crust. Thus, the positioning statement was “your guests get Swiss cheese, Italian Pizza you get stained glassware.'' But Indians are reluctant to use dishwashers because of deeply embedded cultural reasons. Thus, the message had to be changed to appeal to the Indian housewife. Thus the positioning was changed to “Bye, Bye Kanta Bai'' indicating that the dishwasher signaled the end of the servant maid's tyranny. The brand, therefore, was repositioned from a sophisticated, aristocratic product to one that is functional and relevant to the Indian housewife.
Consumer behavior is about how individual make decisions to spread their time, money and effort on consumption related decisions. “ How do consumers respond to marketing efforts the company might use?” “ How do consumers respond to marketing efforts the company might use?” Consumer Buying Behavior
The Buyer Decision Process Need Recognition Information Search Evaluation of Alternatives Purchase Decision Postpurchase Behavior
The Buyer Decision Process Step 1. Need Recognition External Stimuli TV advertising Magazine ad Radio slogan Stimuli in the environment External Stimuli TV advertising Magazine ad Radio slogan Stimuli in the environment Internal Stimuli Hunger Thirst A person’s normal needs Internal Stimuli Hunger Thirst A person’s normal needs Need Recognition Difference between an actual state and a desired state Need Recognition Difference between an actual state and a desired state
The Buyer Decision Process Step 2. Information Search Family, friends, neighbors Most influential source of information Advertising, salespeople Receives most information from these sources Mass Media Consumer-rating groups Handling the product Examining the product Using the product Personal Sources Commercial Sources Public Sources Experiential Sources
The Buyer Decision Process Step 3. Evaluation of Alternatives Product Attributes Evaluation of Quality, Price, & Features Product Attributes Evaluation of Quality, Price, & Features Degree of Importance Which attributes matter most to me? Degree of Importance Which attributes matter most to me? Brand Beliefs What do I believe about each available brand? Brand Beliefs What do I believe about each available brand? Total Product Satisfaction Based on what I’m looking for, how satisfied would I be with each product? Total Product Satisfaction Based on what I’m looking for, how satisfied would I be with each product? Evaluation Procedures Choosing a product (and brand) based on one or more attributes. Evaluation Procedures Choosing a product (and brand) based on one or more attributes.
The Buyer Decision Process Step 4. Purchase Decision Purchase Intention Desire to buy the most preferred brand Purchase Intention Desire to buy the most preferred brand Purchase Decision Attitudes of others
The Buyer Decision Process Step 5. Postpurchase Behavior The Buyer Decision Process Step 5. Postpurchase Behavior Consumer’s Expectations of Product’s Performance Consumer’s Expectations of Product’s Performance Dissatisfied Customer Satisfied Customer! Satisfied Customer! Product’s Perceived Performance Cognitive Dissonance
Marketing Information system Marketing information system (MIS) is a set of procedures and methods designed to generate, analyze, disseminate, and store anticipated marketing decision information on a regular, continuous basis. An information system can be used operationally, managerially, and strategically for several aspects of marketing. Marketing informations can be used operationally, managerially, and strategically for several aspects of marketing.
We all know that no marketing activity can be carried out in isolation, know when we say it doesn’t work in isolation that means there are various forces could be external or internal, controllable or uncontrollable which are working on it. Thus to know which forces are acting on it and its impact the marketer needs to gathering the data through its own resources which in terms of marketing we can say he is trying to gather the market information or form a marketing information system.
Sources of Information Internal company information – E.g. sales, orders, customer profiles, stocks, customer service reports etc Marketing intelligence – This can be information gathered from many sources, including suppliers, customers, and distributors. Market research – Management cannot always wait for information to arrive in bits and pieces from internal sources
Advantages 1. Organized data collection. 2. An avoidance of crises. 3. Coordinated marketing plans. 4. Speed in obtaining sufficient information to make decisions.
Disadvantages The disadvantages of a Marketing information system are high initial time and labor costs and the complexity of setting up an information system