Download - Session 2 MM-I
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Session - 2
Core Marketing Concepts &
Indian Scenario
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Core Marketing Concepts
Productsand
Services
Value, satisfaction,and quality
Needs, wants,and demands
Exchange, transactions,and relationships
Markets
CoreMarketingConcepts
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What motivates a Consumerto take action?
Needs - state of felt deprivation for basicitems such as food and clothing andcomplex needs such as for belonging.
i.e. I am thirstyWants - form that a human need takes as
shaped by culture and individual
personality. i.e. I want a Coca-Cola.Demands - human wants backed by
buying power. i.e. I have money to buy a
Coca-Cola.
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What Will Satisfy ConsumersNeeds and Wants?
Products - anything thatcan be offered to a
market for attention,
acquisition, use orconsumption and that
might satisfy a need or
want. Examples: persons,
places, organizations,
activities, and ideas.
Services - activities or
benefits offered for sale
that are essentially
intangible and dont result
in the ownership of
anything.
Examples: banking,
airlines, haircuts, and
hotels.
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How do Consumers choose amongProducts and Services?
Customer Value - benefit that thecustomer gains from owning and using a
product compared to the cost of
obtaining the product.
Customer Satisfaction - depends on the
products perceived performance in
delivering value relative to a buyers
expectations.
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How do Consumers obtainProducts and Services?
Exchanges - act of obtaining desiredbenefit(s) from someone by offeringsomething in return.
Transactions - trade of valuesbetween parties. Usually involves
money and a response.Relationships - building long-term
relationships (bond) with consumers,
distributors, dealers, and suppliers.
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How to convey to Consumers aboutProducts and Services?
Marketing Channels: Communication Channelsdeliver and receive messages from
target buyers. e.g. TV, Radio, Billboards, Posters, Internet etc.
Distribution channels: display, sell or deliver the products orservices.
Service channels: Facilitate transactions. e.g. Warehouses,Transportation companies, Banks and insurance companies.
Supply chain: channel stretching from raw materials tothe final buyers.
Marketing Environment: Task environmentcompany, suppliers including services
(like MR agencies, Ad agencies, Banking, Insurance,Transportation Companies etc), distributors, dealers, targetcustomers.
Broad environmentdemographic, economic, technological,
Socio-cultural, political and legal.
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Who PurchasesProducts and Services?
Market - buyerswho share a
particular needor wantthat canbe satisfied by a
companys products
or services.
ActualBuyers
PotentialBuyers
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Modern Marketing System
Suppliers
End User
Market
Marketing
Intermediaries
CompetitorsCompany
(Marketer)
Environme
nt
Environment
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Marketing Management
Marketing Management
Implementing programs to create exchanges with target buyersto achieve organizational goals
Finding and analysing the demand patternand increasing it over time;Changing or reducing demand(e.g. old models of Co.s in Automobile mkt)
Demand Management
Attracting new customers andretaining current customers
Profitable Customer Relationships
Need to understand
To understand and achieve
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EmergingChallenges
NonprofitMarketing
New
Marketingparadigms &InformationTechnology
EthicalConcerns Globalization
Changing
WorldEconomy
New Marketing Challenges
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Marketplace, Marketspace & Metamarkets
Marketplace is physical; Marketspace is virtual
(internet).
Metamarkets: cluster of complementaryproducts and services in the same industry.
E.g. Automobile Co.s, Car dealers, financial
companies, Insurance companies, spare parts dealers,
service shops, auto magazines auto sites over
internet.
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Target Markets, Positioning & Segmentation
Segmentation: based on demographic, psychographic and/or
behavioural similarities/ dissimilarities.
Target Markets: Identifying & profiling distinct group of buyers
prefer varying product/services mixesexamining the Macro-
environment (Demographic, psychographic, and behavioural differencesamong buyers)For SEGMENT(S) company may offer customized or
standardized benefit(s).
Positioning: Offering (value proposition) is suitably/ appropriately
placed in the mind of the customerbased on unique
features/identified gap(s) in the market. E.g. Scorpio launched by
M&M in 2002Sports utility vehicle (SUV)luxury and comfort
(positioning: luxury of a car and adventure of a SUV).
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Demand States Negative demand: consumers dislike the product but still pay for it. (e.g.
Vaccination, dental treatment etc.)
Nonexistent demand: consumer may be unaware or not interested in the
product/ service. (e.g. Pharma retail chains Membership schemes)
Latent demand: consumers may have a strong need- which either may not
be satisfied by existing products or may not have specified. (e.g. Insuranceetc.)
Declining demand: consumer begin to buy the product less frequently. (e.g.ice-creams, cold beverages during Winter)
Irregular demand: consumer purchase very occasionally. (e.g. Cement, WallPaint, electric switches and other appliances etc)
Full demand: consumers are adequately buying all products available in themarket. (e.g. Milk products)
Overfull demand: More consumers would like to buy than the supply. (e.g.Milk pdts. during Shivratri festival)
Unwholesome demand: consumers may be using products that have
undesirable social consequences. (e.g. Cigarettes, Alcoholic drinks etc.)
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Factors influencing Marketing Strategies
PLACE
PROMOTION
PRICE
PRODUCT
TARGET
CUSTOMERS
SUPPLIERS
MARKETING
INTERMEDIARIES PUBLIC
COMPETITORS
Demographic/Economic
Political/
Legal
Social/Cultural
Technological
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Designing a Customer driven
Marketing Strategy
To design a effective marketing strategy,
managers follow two important guidelines:
What customers will we serve?
(target markets)
How can we serve these customers best &better than competitors ?
(value proposition)
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Choosing an appropriate
Value Proposition
Value Proposition: set/ mix of benefits and values, acompany promises to deliver to the customer to satisfy
their needs.
How todifferentiate and
How to position it in the marketplace and market space.
e.g. Value propositions:BMW: the ultimate driving machine
Nokia: Connecting People anyone, anywhere
Apples iPhone: Touching is believing
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Indian Marketing Scenario
Conversion of EPZs into SEZs. Retail and Real Estate boom.
Growth in Medical Insurance & Tourism.
Branding of Tourism (Services).
Demographic changes in India society.
Branding of Commodities
Enhancement in Pharmaceutical value chain.
Jewellary market witnessing more organised
activities.