Introduction to

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But first, let’s break some ice…

Deliverables of today’s session

Introduction to Marketing (10 mins)– The Marketing concept (15 mins)– Marketing Mix (45 mins)

• Product• Price• Promotion• Place

– STP (Segmentation, Targeting and Positioning) (15 mins)

Also, a glimpse of:

• The Marketing Specializations: (30 mins)– Consumer Behavior– Marketing Research– Sales and distribution– Integrated Marketing Communications– Services Marketing– International Marketing– Brand Management

Introduction to Marketing

From the time you wake up..

• Turn off that alarm – brush your teeth – take a shower – have breakfast – get dressed – travel to work – use the copier – go out for dinner at ____ - fall asleep

• We use more than 250 brands by the time our day ends !!

Marketing is omnipresent ..!

“The average person in a metro-city is exposed to over 3,000 advertising messages a day…!!”

...consciously or otherwise.

Source: http://www.superprofile.com

• We are constantly being targeted !!

Marketing is natural…

• Analogy of marketing with the nature’s law of “survival of the fittest”

To accompany A Framework for Marketing Management, 2nd Edition Slide 12 in Chapter 1

What Can Be Marketed?What Can Be Marketed?

• Goods

• Services

• Experiences

• Events

• Persons

• Places

• Properties

• Organizations

• Information

• Ideas

Let’s define…

‘Marketing is the management process that identifies, anticipates and satisfies customer requirements profitably’

The Chartered Institute of Marketing

‘The right product, in the right place, at the right time, and at

the right price’

Adcock et al

‘Marketing is the human activity directed at satisfying

human needs and wants through an exchange

process’

Philip Kotler

To accompany A Framework for Marketing Management, 2nd Edition Slide 17 in Chapter 1

• The AMA definition: “Marketing is the process of planning and

executing the conception, pricing, promotion, and distribution of ideas, goods, and services to create exchanges that satisfy individual and organizational objectives.”

No single definition or approach

• But the common subject matters:

– The ability to satisfy customers,– The identification of favorable marketing

opportunities– The need to create an edge over competitors– The capacity to make profits to enable a

viable future for the organization– The aim to increase market share mainly in

target markets

Some marketing Gurus..

Evolution of the marketing concept

Production ConceptProduction Concept

Product ConceptProduct Concept

Selling ConceptSelling Concept

Marketing ConceptMarketing Concept

Consumers prefer products that are widely available and inexpensive

Consumers favor products that offer the most quality, performance,

or innovative features

Consumers will buy products only ifthe company aggressively

promotes/sells these products

Focuses on needs/ wants of target markets & delivering value

better than competitors

Company Orientations Towards the Marketplace

Societal Marketing Concept

Societal Marketing

Concept

Company(Profits)

Consumers(Want Satisfaction)

Society(Human Welfare)

Customers

Front-line people

Middle Management

TopManagement

Modern Marketing Concept Traditional Organization Chart

Modern Marketing Concept Customer-Oriented Organization Chart

Customers

Front-line people

Middle management

Topmanage-

ment

Customers Cus

tom

ers

To accompany A Framework for Marketing Management, 2nd Edition Slide 25 in Chapter 1

Simple Marketing SystemSimple Marketing System

Core Concepts of Marketing

Needs, wants, and demands

Productsand services

Value and satisfaction

Exchange, transactions,

and relationships

Markets

The Marketing Mix

Developed to achieve the company’s objectives.

Also called:

4 P’s of

Marketing

Product

What is a Product?

A product is anything that can be offered to a market to satisfy a want or need, including physical goods, services,

experiences, events, persons, places, properties, organizations, information, and

ideas.

Product Mix

• Total sum of all products and variants offered by an organization

Five Product Levels

‘Hotel’ Example:

• Core product: ‘rest and sleep’• Basic product: room includes bed,

bathroom, towels, desk, dresser, closet• Expected product: clean bed, fresh towels,

working electrical utilities• Augmented product: exceeds customer

expectations • Potential product: which includes all

possible augmentations and transformations

Product Differentiation

• Product form• Features• Customization• Performance• Conformance• Durability• Reliability• Repairability• Style

Service Differentiation

• Ordering ease• Delivery• Installation• Customer training• Customer consulting• Maintenance and repair

Product Life Cycle

Some products are just great..

But there are risks Involved:

• There is always a RISK of product failure due to:

• Failure of conventional marketing research

• Failure to gauge consumer tastes

• Outsmarted by competition

Some Products That Failed..

Source: http://lilomag.com/2011/01/31/top-10-failed-products/

People tend to pamper their pets, so it’s not far-fetched to believe consumers might serve bottled water to their cats and dogs.

But despite the fact that the water came in such delicious flavors as Crispy Beef and Tangy Fish, it never seemed to catch on..

• In what must be one of the most bizarre brand extensions ever Colgate decided to use its name on a range of food products called Colgate’s Kitchen Entrees.

• Needless to say, the products did not take off and never left U.S. soil.

• Hockey Puck Mouse (1998-2000) by Apple

• This design debacle came in an array of Jellies colors, but the cutesiness couldn't compensate for the awkward round shape.

• The mouse was difficult to maneuver and the push button frustratingly evasive

• The 2-foot cord only barely reached around from the left-side USB port of most App

• After watching their share of the soft drink market shrivel for decades, in 1985 the Coca-Cola bottling company decided to do something about it:

• They introduced the “New Coke” with a change in their secret formula of more than a 100 yrs.

• Consumers revolted and ultimately the product failed.

New Product Testing

• It means that before the full-scale commercialization of new products, launching them into test markets to test its viability.

• Coke is test marketing some really cool looking aluminum bottles for Coke Classic, Diet Coke, and Coke Zero at nightclubs and special vending machines.

Source: http://www.vendingmarketwatch.com/news/10282919/coca-cola-co-to-test-market-machines-that-utilize-the-google-wallet

Vending machines being tested with “Google Wallet” smart phones

Source: http://www.vendingmarketwatch.com/news/10282919/coca-cola-co-to-test-market-machines-that-utilize-the-google-wallet

PRICE

Definition:

• In ordinary usage, price is the quantity of payment or compensation given by one party to another in return for goods or services.

Objectives of Pricing

• Short-term profit maximization

• Short-term revenue maximization

• Maximize quantity

• Maximize profit margin

• Differentiation

• Survival

Source: http://entrepreneurs.about.com/od/salesmarketing/a/pricingstrategy.htm

Pricing Strategies

Major Pricing Strategies

1. Price Vs. Non-price competition

2. Market entry strategies

3. Discounts and allowances

4. Geographic pricing strategies

5. Special pricing strategies

Place

Marketing Channels and Supply Chain Management

The fourth ‘P’ of marketing

(place)

How a Distributor Reduces theNumber of Channel Transactions

= Customer= Customer= Manufacturer= Manufacturer

11

3322

445566

778899

How a Distributor Reduces theHow a Distributor Reduces theNumber of Channel TransactionsNumber of Channel Transactions

= Distributor= Distributor= Customer= Customer= Manufacturer= Manufacturer

Store

11

22

33

44

55

66

Consumer Marketing ChannelsConsumer Marketing Channels

WholesalerWholesaler DistributorDistributor RetailerRetailer ConsumerConsumer

ConsumerConsumer

RetailerRetailer ConsumerConsumer

ManufacturerManufacturer

0-level channel

WholesalerWholesaler RetailerRetailer ConsumerConsumer MfgMfg

2-level channel

MfgMfg

3-level channel

1-level channel

ManufacturerManufacturer

Conventional Distribution Channel vs. Vertical Marketing Systems

VerticalVerticalmarketingmarketingchannelchannel

Manufacturer

Retailer

ConventionalConventionalmarketingmarketingchannelchannel

Consumer

Manufacturer

Consumer

Retailer

Wholesaler

Wh

ole

sale

r

Forward &Backward Integration

Eg. ITCAshirwad attaSunfeast

Channel Management DecisionsChannel Management Decisions

SelectingSelecting

FE

ED

BA

CK

MotivatingMotivating

TrainingTraining

EvaluatingEvaluating

Promotion

Concept of ‘Promotion’

• Promotion is all personal and impersonal efforts by a seller to

– Inform

– Persuade or

– Remind a target audience.

Promotion includes:

• Personal Selling

• Advertising

• Sales Promotion

• Public Relations (PR)

Personal Selling

• Direct presentation of a product to a prospective customer by a representative of the organization selling it.

– Face to face– Over the phone

Advertising

• The non-personal communication of information usually paid for & usually persuasive in nature, about products (goods & services) or ideas by identified sponsor through various media.

– Broadcast media (TV, Radio)– Print media (newspapers, magazines)– Outdoor media (billboards)– Internet– Mobile phones– Other media

Sales Promotion

• Incentives given to encourage sales and help personal selling.– Premiums – Event sponsorships– Contests– Trade shows– In-store displays, samples, rebates– Discounts and coupons

If given to channel partners: Trade Promotion

Public Relations

• Efforts to develop favorable attitudes and opinions about products/organizations– Newsletters– Annual reports– Lobbying, charitable events etc.

• Publicity– News stories about organization & products

Marketing Concept - The 4 P’s && The 4 Cs

MarketingMix

Product

PricePromotion

Place

CustomerSolution

CustomerCost Communication

Convenience

Marketing Concept - The 4 P’s

The extended marketing mix

Also called the service marketing mix

• People

• Process

• Physical Evidence

STP

• Segmentation

• Targeting

• Positioning

Glimpse of Marketing Specializations

– Consumer Behavior– Marketing Research– Sales and distribution– Integrated Marketing Communications– Services Marketing– International Marketing– Brand Management

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