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MARKETING AND SALES.

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Presentation on theme: "MARKETING AND SALES."— Presentation transcript:

1 MARKETING AND SALES

2 All of the above, plus much more!
What is Marketing…?? Selling? Advertising? Promotions? Making products available in stores? Maintaining inventories? All of the above, plus much more!

3 Marketing Marketing is the art and science of choosing target markets and getting, keeping, and growing customers through creating, delivering, and communicating superior customer value.

4 Simple Marketing System
Communication Industry (a collection of sellers) Market of Buyers) Goods/services Money Information

5 Selling vs. Marketing Dimension Selling Marketing
Concepts Integral part of Marketing Broader concept, includes selling, brand, Mkt research, distribution, promotion, strategy Objective Transaction Exchange, Customer, Demand management Target Buyer Needs/ wants of the customer Focus Product Brand/ service USP Price Value Strategy Sales force + promotion Marketing mix Period Short term Long term Controls Sales/Delivery/ Collections Customer satisfaction, market share Skills Selling/ Communication Analytical Orientation People Team Begins When you have a product Much before & long after a product

6 Difference Between - Sales & Marketing ?
Sales trying to get the customer to want what the company produces Marketing trying to get the company produce what the customer wants

7 Scope of marketing What can be marketed or sold ?
Goods Services Events Experiences Personalities Place Organizations Properties Information Ideas and concepts What can be marketed or sold ? Anything under the sun …………

8 Core Concepts of Marketing
Needs, wants demands Products Utility, Value & Satisfaction Markets Marketing & Marketers Exchange, Transaction Relationships

9 Core Concepts of Marketing
Need – food ( is a must ) Want – Pizza, Burger, French fry's ( translation of a need as per our experience ) Demand – Burger ( translation of a want as per our willingness and ability to buy ) Desire – Have a Burger in a Mac-D

10 Customers Competition Company
In order to understand Marketing let us begin with the Marketing Triangle Customers Competition Company

11 Who is a Customer ?? CUSTOMER IS . . . . .
Anyone who is in the market looking at a product / service for attention, acquisition, use or consumption that satisfies a want or a need

12 Product is Anything that is offered to the market for attention, acquisition, use or consumption that satisfies a want or a need

13 Market A Public place where buyers and sellers make transactions, directly or via intermediaries

14 Types of Products Consumer Products Industrial PRODUCTS Services

15 Uniqueness of medical products marketing
Customer and consumer are two separate entities Customer is more aware and informed about the products Marketing is regulated by various guidelines (example: advertising not allowed for schedule H drugs) Medical council of india( MCI) governs the inputs provided to medical practitioner (doctor i.e customer for pharma companies) While Drugs and Magic remedies act governs the content of advertising of the medical products Direct to consumer marketing is not allowed for on prescription medical products

16 Uniqueness of medical products marketing
Marketing of product and claims has to be backed by clinical evidences for medical products Evidence based marketing is desirable For OTC ( over the counter products) marketing can be done by advertising directly to the patient (eg: ranbaxy’s revital)

17 medical products selling process
detailing Doctors Pharma company Sales representative Product sample Clinical data Prescribes Rx money Patient Retail chemist medicine

18 Distribution

19 The Distribution Function
distribution is about getting the product or service to the customer as conveniently as possible; it deals with access and availability intermediaries perform many of the distribution functions on behalf of suppliers merchant intermediaries actually take title to physical products that they distribute agents do not ever own the products, but they arrange the transfer of title Distribution happens through various channels

20 Distribution Channel What is a Distribution Channel?
A set of organizations (intermediaries) involved in the process of making a product or service available for use or consumption by the consumer or business user. Used to move the customer towards the product Selling through wholesalers and retailers usually is much more efficient and cost effective than direct sales.

21 Distribution Channels
The role of distribution entails: Arranging for its sale and transfer of title Promoting the product Storing the product Assuming some risk during distribution. Intermediaries often perform these activities for producer or consumer. All roads lead to Rome

22 Distribution Channel Functions
Information: gathering and distributing marketing research and intelligence information about the marketing environment. Promotion: developing and spreading persuasive communications about an offer Contact: finding and communicating with prospective buyers Matching: shaping and fitting the offer to the buyer’s needs, including such activities as manufacturing, grading, assembling, and packaging.

23 Number of Channel Levels
Channel Level - Each Layer of Marketing Intermediaries that Perform Some Work in Bringing the Product and its Ownership Closer to the Final Buyer. Producer 0-level channel Consumer 1-level channel Producer Retailer Consumer Producer 2-level channel Wholesaler Retailer Consumer Producer 3-level channel In Pharma Wholesaler Jobber Retailer Consumer

24 All India organization of Chemists & Druggists Association (AIOCD)
Factory HUB Branch/C & F Agent Distributor Chemist All India organization of Chemists & Druggists Association (AIOCD)

25 Evaluation of Domestic Pharmaceutical Distribution
1970 National distributors 1980 Own Branches Early 1990’s CFAs Mid 90’s Hubs, CFAs, Consignment Agent 2000 to2006 Hubs, CFAs Rs.650 Cr Rs.2,750- Rs.3,000cr Rs.8,000-Rs.8,500 cr Rs.14, ,500cr Rs 23,500cr Stockist margins (4% & 6%) (6% & 8%) (8% & 10%) Retailer margins (8% & 12%) (12% & 16%) (16% & 20%) Entry of Sub- stockists Increase in Institutional sales Entry of government Pharmacy chains (2002 onwards) Stockists- 18,000 Retailers- 1,25 lakhs 20,700 2 lakhs 23,500 3 lakhs 28,500 4 lakhs 55,000 5 lakhs Stockists Chemists Price Control 8% 16% Out of Price control 10% 20% Source: EY research & trade bodies

26 Pharma distribution channel
Pharma company 1 CFA Distributor ( stockist) Selected Institutes (hospitals) Cental govt or state govt 2 Sub Distributor ( sub stockist) Retailer ( chemist) Patient (consumer) 3 3-level channel of distribution

27 Role of carrying and forwarding agent (CFA)
A extended part of pharma company ( single pharma company) CFA can also be a manufacturer owned warehouse or an independent service provider paid a certain commission per unit handled They help in the routinization of transactions adjustment of assortment discrepancy and sorting-breaking down a heterogeneous supply into separate stocks that are relatively homogeneous ALLOCATION- breaking down a homogeneous supply into smaller slots & ASSORTING-Building assortments that are readily consumable Accumulation-BRINGING SIMILAR STOCKS from different suppliers Does not have a fixed margin for doing that but operates on share of revenue on the volumes that it trades ( 1.5 to 2% commission) Appointed at a state level ( at max 2-3 CFA’s per state)

28 Role of a stockist ( distributor)
Keep stock of multiple pharma companies to distribute it to the retail chemist They get fix margins for selling the medicines from the pharma companies ( 10% for the product out of price order and 8% for the product within price order) They are appointed by the pharma company and have to operate to distribute products for a particular region (territory) Pharma company appoints minimum1 and max 3 distributers for one region) Order stock at every month end from the respective CFA’S (termed as closing 28th to 31st or 1st week of every month) Is take a permission from All India Organisation of Chemist and Druggist ( AIOCD)

29 Role of a sub-stockist They share the stock with stockist to distribute it to the area not covered by the stockist Shares the margins with the stockist Act as mediator between stockist and retailer Have a limited existence in pharma supply chain For rural and extra urban regions a pharma company appoints a sub-stockist to increase their reach in those areas

30 Role of a retail chemist
Is a point of purchase for the patient Operates on fixed margins(20% for products not under price order and 16% for products under price order) Order stock from stockist as and when required and do not have a fixed ordering schedule Keeps stock of all the companies and sells to the patients at maximum retail price (MRP) They are registered with state FDA authorities

31 Retail chains

32 Patterns of Distribution
Determines the intensity of the distribution Intensity decides the service level provided Types of distribution intensity: Intensive Selective Exclusive

33 Distribution Intensity
Intensive: distribution through every reasonable outlet available – FMCG Selective: multiple, but not all outlets in the market – pharma, frozen food Exclusive: may be only one outlet in a market - car dealers

34 Intensive Distribution
Strategy is to make sure that the product is available in as many outlets as possible Preferred for consumer, pharmaceutical products and automobile spares

35 Selective Distribution
A few select outlets will be permitted to keep the products Outlets selected in line with the image the company wants to project Preferred for high value products Tanishque jewelry Keeps distribution costs lower

36 Exclusive Distribution
Highly selective choice of outlets – may be even one outlet in an entire market Could include outlets set up by companies – Titan, Bata Producer wants a close watch and control on the distribution of his products.

37 THANK YOU -PHARMA STREET


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