Ppt-1 marketing - Lecture notes 1-4 PDF

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lecture notes for marketing management from kotler's book....

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Questions: Why is marketing imp?

It informs: On a base level, marketing is useful for customer education. Sure, you know the ins-and-outs of your product but do your consumers? In order to buy into a product, your audience needs to have a solid understanding of what it does and how it works. It sells: Marketing is important because it helps you sell your products or services. The bottom line of any business is to make money and marketing is an essential channel to reach that end goal. It grows: Marketing is an important strategy to ensure the growth of your business. While your current customers should always be your main priority, marketing efforts can help you expand this base. What is scope of marketing? Marketing has a very wide scope it covers all the activities from conception of ideas to realization of profits. Some of them as discussed below: 

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Study of consumer wants and needs: Goods are produced to satisfy consumer’s wants and needs. Therefore study is done to identity consumer needs and wants. These needs and wants motivates consumer to purchase. Study consumer behaviour: Marketers perform study of consumer behaviour. Analysis of buyer behavior helps marketer in market segmentation and targeting. Product planning and development: It includes the activities of product research, marketing research, marketing segmentation, product development, determination of attributes, quality and quantity of products. Branding: Branding of products is adopted by many reputed enterprises to make their products popular among their customers and many other benefits. Marketing manager has to take decision regarding the branding policy, procedures and implementation programs. Packaging: Packaging is to provide a container or wrapper to the product for safety, attraction and ease to use and transportation of product.

How has marketing management changed? Marketing management has changed a lot in recent years. Following are some changes listed below:  Network information technology  Globalization

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Deregulation Privatization Heightened competition Industry convergence Consumer resistance Retail transformation Disintermediation

What are the tasks necessary for successful marketing management?       

Developing marketing strategies & plans Assessing marketing opportunities & customer value Choosing value Designing value Delivering value Communicating value Sustaining growth & value

---------------------------x-------------------------x----------------------x-------------------------TYPES OF DEMAND: 1) Negative Demand Negative demand is a type of demand which is created if the product is disliked in general. The product might be beneficial but the customer does not want it. Example of negative demand is a) Dental work where people don’t want problems with their teeth and use preventive measures to avoid the same. b) Insurance, which people should have but they delay buying an insurance policy. Similarly, people would like to avoid heart attacks and hence may pay for a full body check up where the results might be negative, but still the customer has to pay. The marketer has to solve the issue of no demand by analyzing why the market dislikes the product and then counter acting with the right marketing tactics. 2) Unwholesome demand Unwholesome demand is the other side of Negative demand. In negative type of demands, customer does not want the product even though product might be necessary for the customer. But in unwholesome demand, the customer should not desire the product, yet the customer wants the product badly. Best example of unwholesome demand are cigarettes, alcohol, pirated movies, guns etc. 3) No demands

Certain products face the challenge of no demand. The best example for the same can be education courses where there is very low demand or no demand at all. Such cases are very hard to counter. 4) Latent Demand Latent demand is, as the name suggests, a demand which the customer realizes later. Thus, while buying the product, he might not desire some features. But later on, he might think about those features and buy the product. The best example of latent demand are normal phones vs smart phones. People nowadays want more and more features in the smartphone. They might settle for a normal phone, but then later on they get the itch to buy a smart phone. Similarly, people might buy a petrol car. But most likely their second car will be a diesel car. A marketing managers job is to find out the features which people might be looking for later and market them to the customer in such a manner that he immediately wants them. 5) Declining demand Declining demand is when demand for a product is declining. For example, when CD players were introduced and IPOD came in the market, the demand for walkman went down. Although there was still a demand for the product, the demand was a declining demand. A marketers job in such a case to think ways to revive the product so that the demand is not declining. 6) Irregular demand Irregular demand can be demand which is not consistent. The best example of irregular demand is seasonal products like umbrellas, air conditioners or resorts. These products sell irregularly and sell more during peak season whereas their demand is very low during non seasons. The best way to counter irregular demand is to introduce incentives for the customer to buy the product. 7) Full demand In an ideal environment, a company should always have full demand. Full demand means that the demand is meeting the supply potential of the company. It also means that the markets are happy with the products of the company and that people want to buy from the same company. The marketing challenge in this type of demand is to maintain the same level of interest in the product and the company. 8) Overfull demands Overfull demands happen when the companies manufacturing capacity is limited but the demand is more than the supply. This can be observed in the cement industry occasionally. Generally, most cement industries have limited manufacturing capacity. And hence, brand switching in cement industry is high. Many companies use de-

marketing techniques to counter act overfull demands. This is because if the company keeps marketing, but it is not able to supply the material, then the company might suffer badly in brand equity.

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Key Customer Markets Consumer Markets: Companies selling mass consumer goods and services such as juices, cosmetics, athletic shoes, and air travel spend a great deal of time establishing a strong brand image by developing a superior product and packaging, ensuring its availability, and backing it with engaging communications and reliable service. Business Markets: Marketplaces where organizations purchase raw materials, natural resources and components of other products for their resale or for use in manufacturing another product. Business markets are generally made up of businesses which buy products and raw materials for their own operation. Global Markets: Companies in the global marketplace must decide which countries to enter; how to enter each (as an exporter, licenser, joint venture partner, contract manufacturer, or solo manufacturer); how to adapt product and service features to each country; how to price products in different countries; and how to design communications for different cultures. They face different

requirements for buying and disposing of property; cultural, language, legal and political differences; and currency fluctuations. Yet, the payoff can be huge. Nonprofit and Governmental Markets: Companies selling to nonprofit organizations with limited purchasing power such as churches, universities, charitable organizations, and government agencies need to price carefully. Lower selling prices affect the features and quality the seller can build into the offering. Much government purchasing calls for bids, and buyers often focus on practical solutions and favor the lowest bid in the absence of extenuating factors.

Segmentation, Targeting, and Positioning Segmentation, targeting, and positioning together comprise a three stage process. We first (1) determine which kinds of customers exist, then (2) select which ones we are best off trying to serve and, finally, (3) implement our segmentation by optimizing our products/services for that segment andcommunicating that we have made the choice to distinguish ourselves that way. Segmentation involves finding out what kinds of consumers with different needs exist. In the auto market, for example, some consumers demand speed and performance, while others are much more concerned about roominess and safety. In general, it holds true that “You can’t be all things to all people,” and experience has demonstrated that firms that specialize in meeting the needs of one group of consumers over another tend to be more profitable.

In the next step, we decide to target one or more segments. Our choice should generally depend on several factors. First, how well are existing segments served by other manufacturers? It will be more difficult to appeal to a segment that is already well served than to one whose needs are not currently being served well. Secondly, how large is the segment, and how can we expect it to grow? (Note that a downside to a large, rapidly growing segment is that it tends to attract competition). Thirdly, do we have strengths as a company that will help us appeal particularly to one group of consumers? Firms may already have an established reputation. While McDonald’s has a great reputation for fast, consistent quality, family friendly food, it would be difficult to convince consumers that McDonald’s now offers gourmet food. Thus, McD’s would probably be better off targeting families in search of consistent quality food in nice, clean restaurants. Positioning involves implementing our targeting. For example, Apple Computer has chosen to position itself as a maker of user-friendly computers. Thus, Apple has done a lot through its advertising to promote itself, through its unintimidating icons, as a computer for “nongeeks.”

HOLISTIC MARKETING CONCEPT: Holistic marketing concept is a part of the series on concepts of marketing and it can be defined as a marketing strategy which considers the business as a whole and not as an entity with various different parts.

According to holistic marketing concept, even if a business is made of various departments, the departments have to come together to project a positive & united business image in the minds of the customer. Holistic marketing concept involves interconnected marketing activities to ensure that the customer is likely to purchase their product rather than competition. Ex Exam am ample ple o off H Holi oli olisti sti sticc m maark rketin etin etingg co conce nce ncep pt

An organization will have different departments like sales and marketing, accounting and finance, R&D and product development and finally HR and operations. Thus, if you want to implement a holistic marketing concept in your organization, you need to ensure that R&D and product development take the feedback from marketing and sales to launch the product which is most likely to attract customers. On the other hand they need to work closely with accounting and finance to find out the exact budget for the project. Sales and marketing need to communicate to the HR the right kind of people that they need, and finally, admin and operations need to devise a plan to retain these people. Key concepts: Internal marketing – Marketing between all the departments in an organization Relationship marketing – Building a better relationship with your customers, internal as well as end customers is beneficial for holistic marketing. Performance marketing – Driving the sales and revenue growth of an organization holistically by reducing costs and increasing sales. Integrated marketing – Products, services and marketing should work hand in hand towards to growth of the organization.

Marketing Mix: 4Ps with 4Cs (Explained) The marketing mix is a blend of marketing variables that determine the level of marketing efforts on the target market. In simple terms; marketing mix is the tool that is used to influence the target market and its demand for product, service, or information.

Product The product is something like good, service, information etc. that satisfies the wants of a company’s target market.

Price Price means the number of dollar customers or consumers must pay to obtain/use the product. It is the amount paid by the customer by to a business. For example, a bottle of Wine that may cost $100.

Place Place indicates the company activities that ensure a product or service available to target consumers. It includes all activities like distribution channels, logistics, transportation, and locations offered by the company. A company may have many stores offering its products across the United States, but there may still locations where customers or consumer will not access that company’s products.

Promotion Promotion refers to the activities that communicate the merits of the product to target customers and influence to buy it. One of the major factors of promotion for products or services is advertising....