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Introduction :
Marketing Management before formulating marketing mix
must take a look at the environment in which enterprises
will to operating in future. It is well known that
environment affects the business planning. The more a
business understands its environment, better chance it has
for profitable growth. Environment represent a complex of
shipts in the structure of society and economy, in the state
of technology, in the customer demand in the market place
and in the requirement of Govt. The knowledge of changing
of environmental force will on able the enterprises to tune
its plan correctly change in the marketing environment.
Gathering information / Marketing information
System
The Marketing environment is changing at an acceleration
rate, the need for real time market information is great than
at any time in the past.
The shifts are from local to national to global marketing,
from buyers needs to buyer wants from price to non price
competition. As companies expand their geographical
market coverage, there Managers need more information
more quickly. As incomes improve buyers become more
selective in their choice of goods. To predict buyer’s
responses to different features, style and other attributes,
1
sellers must turn to marketing research. As Seller’s
increase their use of branding product differentiation,
advertising and sales promotion they require information on
the effectiveness of these marketing tools.
2
Scanning the Environment.
Successful companies take an outside view of their
business. They recognize that the marketing environment is
constantly presenting new opportunities and treats and they
understand the importance of continuously monitoring and
adapting to that environment.
One company that has constantly reinvested one of its
brands to keep up with the changing marketing
environment is Mattel with its Barbie doll.
The major responsibility for identifying significant market
place changes falls to the company’s marketer’s more than
any other group in the company. They must be trend
trackers and opportunity seekers. Although every manager
in an organization needs to observer the outside
environment, marketers have two advantages. They have
disciplined methods – Marketing intelligence and Marketing
Research for collecting information about the marketing
environment.
They spend more time with customers and more time
watching competitors.
Marketing Environment
External Macro environment
3
The following external forces have considerable influence
on any organizations marketing opportunities and activities.
Therefore they are macro environmental forces.
4
A change in any one of them can cause changes in one or
more of the others. Hence they are inter related. One thing
they all have in common is that they are dynamic forces that
are subject to change and at an increasing rate.
Demographics : Refer to the characteristic of populations
including such factors as size , distribution and growth
because people constitute markets, demographics are of
special interest to marketing executives.
Economic conditions: People alone do not make a
market. They must have money to spend and be willing to
psend it. Hence the economic environment is a significant t
force that affects the marketing activities of just about any
organization. A Mareketing program is affected especially
by such economic factors as the current and anticipated
stage the business cycle as well as inflation and interest
rates.
5
Economic condition
TechnologySocial & Cultural forces
CompetitionDemographics
Political and Legal forces
Company Marketing Program
Stages of Business Cycle
The tradition business cycle goes through four stages
Prosperity
Recession
Depression
Recovery
which return full cycle to Prosperity
Prosperity: Is the period of economic growth. During this
stage organization tend to expand their marketing
programmers as they add new products and enter new
markets.
Recession : is a period of retrenchment ( cut down, reduce
in expenses) for customers and business. We tighten our
economic belts.
Recovery : is the period when the economy is moving from
recession to prosperity. The marketers challenge is to
6
Prosperity
RecessionInflation
Recovery
determine who quickly prosperity will return and to what
level.
Inflation: The rice in prices of the goods and services
represent inflation. When the price rises at a faster than
personal incomes , customer buying power declines.
Interest Rate: are another external economic factor that
influences marketing programmers. When interest rates are
high customers tend not to make long term purchase such
as housing. Marketers some time offer below market
interest rates a s a Promotion device to increase business.
Competition: A company’s competitive environment is a
major influence on its marketing programmers.
A firm faces mainly three type of competition
External micro environment
Three additional environmental forces are external to
an organization and affect is marketing activities. These are
the firm’s market suppliers and marketing intermediaries.
They represent microenvironmental forces for a company
dealing effect with them is critical to business success.
Recognizing that many companies are using customer
relationship management software to keep a track of their
customers buying activities and to communicate better with
them
7
Firm, markets, suppliers and marketing intermediaries
represent micro-environmental forces for a company.
Te arrow reflect the inter relationship of product, payments,
information and influence between the company and its
external environment.
INTRODUCTION TO MARKETING RESEARCH
What is Marketing Research?
Marketing Research involves “the gathering, processing,
analysis, storage & dissemination of information in a very
systematic way to market goods and services and to
improve decision making.”
Learning more about consumers and dealers and about
marketing mix generally is the heart of marketing research.
Marketing management has to rely more heavily on
marketing research as a managerial tool in solving any
problem in the field of marketing.
“Marketing Research can also be defined as the
systematic gathering, recording and analysing of data about
problems connected with the market place, i.e. problems
relating to product, price, promotion and distribution of the
4 P’s of the marketing mix.
8
Suppliers Marketing Intermediates
Market Intermediates
The MarketCompany Marketing Program
The research may be limited to a specific problem or
deals with a very comprehensive topic covering all the
manifolds facets of the market, providing the basis for
making decisions.
While conducting Marketing Research, the emphasis is
on:
OBJECTIVITY , i.e. determining the facts as they are
instead of individual hunches on what the facts are ought to
be. Ex: Those in the business think that they know
everything whereas, professionals check and ensure that
information is authentic and original and reliable.
COMPLETENESS, i.e., the availability of total data.
RELIABILITY depends on the manner in which
research is conducted.
OBJECTIVES OF MARKETING RESEARCH
1. Marketing research is used in the formulation of all
marketing plans, policies, programmes and procedures.
2. It is employed for evaluation of these plans, policies,
etc when they are brought into practise.
3. It is used in reducing and minimising all marketing
costs, particularly, selling, advertising, promotion and
distribution costs.
9
4. Programmes of marketing research incidentally
provide insurance cover for the survival and growth of the
business in a dynamic economy.
5. Marketing management through marketing research
can bring about the sale of right product (brand or package)
through right channels to right customers at right places by
evolving right plans, policies and programmes with the help
of right personnel.
6. The main objective of marketing research is to enable
manufactures to make goods acceptable and saleable and to
see that they reach the market more easily, quickly, cheaply
and profitably without sacrificing customer interest.
7. Marketing research finds out for the manufacturer
where are his customers, what they want, when they want
it, and where and how much they are willing to pay for it.
8. It enables producers, merchants, distributers and
advertisers to avoid mistakes either in manufacturing or in
marketing. To that extent it can minimize business failures
and maximise profits.
9. Marketing research is responsible to provide good
information. Managers bases their decisions on information,
not on data. Good information is timely, up to date,
accurate, adequate, relevant, reliable, economical and
above all understandable, acceptable and usable by
managers in decision making process.
10
10. Ever expanding markets require numerous middlemen
between producer and consumer. The widening of
communication gap is the chief single factor for increasing
importance of marketing research to fill up the
communication gap between the consumer and the
producer.
MARKETING RESEARCH PROCEDURE
1. Define the objective/s.
2. Conduct situational analysis.
3. Conduct informal investigation.
4. Plan and conduct formal investigation.
5. Analyze data and report results.
6. Conduct follow-up.
7. End project and report results.
SCOPE OF MARKETING RESEARCH
The scope of marketing research is very vast. Whether it
is the government, travel agency, airlines, business firms
and even non-profit organization, all can benefit from
market research.
Each ought to study consumer behaviour, consumer
demands and attitudes. Moreover, they have to understand
11
the competition, the characteristics of the market,
promotion campaigns, impacts, etc.
Every organization can do the market research separately
themselves or a group may do the research jointly for the
benefit of the members of the group.
Every organization may do the research for information
on how the competition is performing, to understand its
own performance and possible ways to improve. Thus
information may relate to pricing, relationship with
distributors and facilities provided (to end users and
intermediaries.)
Marketing Environment :
Company’s marketing environment is made up of sectors
and forces outside the firm’s marketing function. Those
forces affect the ability of marketing management to
develop and maintain a successful relationship with the
firms target audience.
There are two types of environment :
1. Micro Environment
2. Macro Environment
The Micro Environment consist of marketer and his
(1) Supplier
(2) Distributor
12
(3) Competitors
(4) Consumer
The Macro Environment consists of
1. Economic environment
2. Demographic environment
3. Socio-economic environment
4. Technological environment
5. Political environment
6. Legal environment
1. Economic Environment :
Economic environment is the most significant among
marketing environment. The very survival of business
depends on economic environment. Markets require people
who have purchasing power. The purchasing power
depends on
a. Current income
b. Prices
c. Savings
d. Debt
e. Credit available
If the price of new materials, labor and utilities like
electricity are showing inflating trends, the firm may have
no choice but to pass on the hike to the consumer in the
form of increased prices. If the firm is a monopolist or
13
oligopolist, then it might not face much consumer
resistance. But if the firm is in competitive situation then it
will face stiff resistance from the customer resulting in
customer shifting to another firm.
2) Demographic Environment :
Demographic environment explains the pattern and changes
in the society based on
a) Age
b) Sex
c) Education Background
d) Marital Status
e) Family size
f) Religion
Demographic environment is useful for marketing decision,
such as segmentation and strategies. Demography provides
quantitative as well as qualitative aspect of the population.
It also helps in doing behavioral analysis. E.g. Pepsi
promised to be the drink for the youngsters generation.
Today most urban women are found working Result is the
need for quick recipe and fast food.
3. Socio-Economic Environment :
Social environment of a nation determines the value system
of the society, which in turn affects the marketing of the
products. For example : social factors such as caste,
custom, convention influence the demand for goods and
services.
14
One of the most significant social changes is the large
number of women entering the job market. This situation
has created demand for a wide range of product and
services necessitated by their absence from the home.
There is a lot of change in quality of life styles and people
are willing to have many durable consumer goods like
fridge, T.V., Oven, Geyser, frills etc. Life style have changes.
4. Technological environment :
Technological environment provides both opportunities and
threats. Its impact is direct as well as indirect. Technology
has released wonders such as unclear bombs, it has also
15
Consumer Culture
Consumer BehaviorPatternLife Style
Marketing Activities
Impact on FirmsMarketing Decisions
released such mixed blessings such as automobile and video
games.
Every new technology is a creative destruction. E.g.
Transistors hurt the vacuum tube industry. Xerox hurt
carbon paper business. Television hurt new papers. Instead
of moving with the new technology old industries fought or
ignored them, and these business declined.
5. Political Environment :
Marketing decisions are strongly affected by development in
the political environment. A marketer has to operate his
business in given political environment and his operation
are affected in greater or less degree by government
programme at different levels. Change in political climate
lead to changes in government policies. Political change
may take place in following forms :
a* Stable government leading to very few policy changes
b Frequent changes in government leading to frequent
changes in policies.
6. Legal Environment :
Marketing decisions are strongly affected by laws
pertaining to competition, price, advertising etc. It is
necessary for a marketer to understand the legal
environment of the country and the jurisdiction of its courts.
Some of the act which a marketer should know :
16
a. SEBI Act, 1992
b. Factories Act 1948
c. MRTP Act 1956
d. Environmental Protection Act, 1986
e. Taxation like corporate tax, excise, sales tax,
customs
Micro Environment :
The Micro Environment of organization consist of these
elements which are controllable by the management.
1. Competitor :
Demand for a firm’s product / services is also affected by
the nature and industry of competition in an industry. While
analyzing the competition, the firm should extends its
competitive analysis to include substitutes also, besides
scanning direct competitors. The objective of such analysis
is to predict each competitors response to changes in the
firms strategy and industry conditions.
Framework for Competitors Analysis :
Current & Current &
Satisfaction withMotivators Future goals Future strategy
current level of performance
17
2. Supplier :
The supplier to a firm can also alter its competitive position
and marketing capabilities. These are raw material
suppliers, energy suppliers, suppliers of labor and capital.
The relationship between suppliers and firm is based on the
extent to which each of them dependent on the other.
Broadly, the bargaining power of the buyer firm increased
in the following circumstances :
1. The buyer firm is monopoly or in an oligopoly
position and buys large volumes.
2. The products a buyer firm purchases
represents a significant fraction of buyer’s cost
or purchase.
3. The buyers firm can easily switch its vendors.
4. The buyer firm earns low profits and hence has
a pressure to lower its purchasing costs.
3. Consumers :
A marketers should know the following about the
consumers :
18
COMPETITORS
1. Who buys the product?
2. Why do they buy?
3. What are they looking for in the way of features and prices?
4. What are their images of different brands?
5. What do they think about competitors product?
6. Is the customer price sensitive?
7. What value does the customer think by buying our product?
8. Are there any substitution products?
19
4. Competitors :
What are the competitive scenario in the Indian Marketing
Environment :
Marketing is customer focused. It is not enough if a
company studies its consumers. A must also study its
competitors. E.g.: Coke considers Pepsi as its competitor in
India. Onida knows the BPL and Philips are its competitors
in the T.V. market. Similarly Times of India knows that
Indian Express and Statesman are its competitors. We
should know 3 types of competitors levels based on product
benefits.
a. Firm competition
b. Industry competition
c. Brand competition.
Limitations of the Marketing Research :
In spite of the rapid growth of marketing research, many
companies still fail to use it sufficiently or correctly, for
several reasons :
A narrow consumption of marketing research : Many
managers see marketing research as a fact-finding
operation. They expect the researcher to design a
questionnaire, choose a sample, conduct interviews, and
report results, often without a careful definition of the
problem or of the decision alternatives facing management.
20
Uneven caliber of marketing researchers : Some
managers view marketing research as little more than a
clerical activity and reward it as such. Less competent
marketing researchers are hired, and their weak training
and deficient creatively lead to unimpressive results.
Late and occasionally erroneous findings by marketing
research : Managers want quick results that are accurate
and conclusive. Vet good marketing research takes time and
money.
Personality and presentational differences :
Differences between the styles of line managers and
marketing researchers often get in the way of productive
relationships.
Application of Marketing Research
Marketing Research covers :
Market Research
Sales Research
Product Research
Advertising & Promotion Research
Research on Sale : methods & policies
Distribution research including the dealers research
Marketing Research may seek information on :
21
Market - Its size spread, growth in terms of volume and
revenue share of competition, segment wise.
Consumer - his profiles, habits, needs, preferences,
expectations, perception, both quantitatively &
qualitatively.
Products - To know differentials among competing
products in same position, price sensitively, packaging
servicing, acceptability of features.
Promotion - Sales, effectiveness of communication, reach
of media reaction to promotion strategies, effectiveness of
sales force.
Distribution - Facilities available for stocking,
merchandising outlets shelf space usages, retailer loyalties.
Performance - Monitoring and Evaluation.
Marketing Research is interested in 5 vital areas of
marketing (1) Market (2) Product (3) Price (4)
Promotion (5) Distribution
Marketing research can be useful at 4 stages :
In the problems solving process in any branch of
marketing :
1) To identify and define the problems including
causes.
2) To suggest reasonable and profitable alternative
causes of action.
22
3) To determine most desirable alternative causes of
action and to ensure optimum use of resources.
4) To test the feasibility of particularly alternative
causes of action decided upon by management.
INTRODUCTION TO MARKETING RESEARCH
What is Marketing Research?
Ans: - Marketing Research involves “the gathering,
processing, analysis, storage & dissemination of information
in a very systematic way to market goods and services and
to improve decision making.”
Learning more about consumers and dealers and about
marketing mix generally is the heart of marketing research.
Marketing management has to rely more heavily on
marketing research as a managerial tool in solving any
problem in the field of marketing.
“Marketing Research can also be defined as the
systematic gathering, recording and analysing of data about
problems connected with the market place, i.e. problems
relating to product, price, promotion and distribution of the
4 P’s of the marketing mix.
The research may be limited to a specific problem or
deals with a very comprehensive topic covering all the
23
manifolds facets of the market, providing the basis for
making decisions.
While conducting Marketing Research, the emphasis is
on:
OBJECTIVITY , i.e. determining the facts as they are instead
of individual hunches on what the facts are ought to be. Ex:
Those in the business think that they know everything
whereas, professionals check and ensure that information is
authentic and original and reliable.
COMPLETENESS, i.e., the availability of total data.
RELIABILITY depends on the manner in which research is
conducted.
OBJECTIVES OF MARKETING RESEARCH
Marketing research is used in the formulation of all
marketing plans, policies, programmes and procedures.
It is employed for evaluation of these plans, policies, etc
when they are brought into practise.
It is used in reducing and minimising all marketing costs,
particularly, selling, advertising, promotion and
distribution costs.
Programmes of marketing research incidentally provide
insurance cover for the survival and growth of the
business in a dynamic economy.
24
Marketing management through marketing research can
bring about the sale of right product (brand or package)
through right channels to right customers at right places
by evolving right plans, policies and programmes with
the help of right personnel.
The main objective of marketing research is to enable
manufactures to make goods acceptable and saleable
and to see that they reach the market more easily,
quickly, cheaply and profitably without sacrificing
customer interest.
Marketing research finds out for the manufacturer
where are his customers, what they want, when they
want it, and where and how much they are willing to pay
for it.
It enables producers, merchants, distributers and
advertisers to avoid mistakes either in manufacturing or
in marketing. To that extent it can minimize business
failures and maximise profits.
Marketing research is responsible to provide good
information. Managers bases their decisions on
information, not on data. Good information is timely, up
to date, accurate, adequate, relevant, reliable,
economical and above all understandable, acceptable
and usable by managers in decision making process.
25
Ever expanding markets require numerous middlemen
between producer and consumer. The widening of
communication gap is the chief single factor for
increasing importance of marketing research to fill up
the communication gap between the consumer and the
producer.
26
MARKETING RESEARCH PROCEDURE
Define the objective/s.
Conduct situational analysis.
Conduct informal investigation.
Plan and conduct formal investigation.
Analyze data and report results.
Conduct follow-up.
End project and report results.
27
SCOPE OF MARKETING RESEARCH
The scope of marketing research is very vast. Whether it
is the government, travel agency, airlines, business
firms and even non-profit organization, all can benefit
from market research.
Each ought to study consumer behaviour, consumer
demands and attitudes. Moreover, they have to
understand the competition, the characteristics of the
market, promotion campaigns, impacts, etc.
Every organization can do the market research
separately themselves or a group may do the research
jointly for the benefit of the members of the group.
Every organization may do the research for information
on how the competition is performing, to understand its
own performance and possible ways to improve. Thus
information may relate to pricing, relationship with
distributors and facilities provided (to end users
and intermediaries.)
28
ASSISGMENT ON
MARKETING MANAGEMENT
TOPIC :
MARKETING ENVIRONMENT
Submitted to :
KRISHNA PRASAD. C.R.
MBA Faculty
Dr. AIT College
Submitted By :
CHITRA V.C.
BIJOY B.
DEVARAJ S.
DINESH KUMAR S.
DIVYA
GEETHA
GURURAJ
BHYRALINGEGOWDA
29