introduction to marketing management
DESCRIPTION
A new way to look at marketing... Introductory session to Hospital Management Students of BK School of Business Management, Gujarat University taken on 22 September 2011.for more details, visit:www.profmanishparihar.blogspot.comTRANSCRIPT
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But first, let’s break some ice…
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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)
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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
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Introduction to Marketing
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From the time you wake up..
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• 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 !!
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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
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• We are constantly being targeted !!
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Marketing is natural…
• Analogy of marketing with the nature’s law of “survival of the fittest”
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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
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Let’s define…
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‘Marketing is the management process that identifies, anticipates and satisfies customer requirements profitably’
The Chartered Institute of Marketing
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‘The right product, in the right place, at the right time, and at
the right price’
Adcock et al
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‘Marketing is the human activity directed at satisfying
human needs and wants through an exchange
process’
Philip Kotler
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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.”
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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
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Some marketing Gurus..
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Evolution of the marketing concept
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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
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Societal Marketing Concept
Societal Marketing
Concept
Company(Profits)
Consumers(Want Satisfaction)
Society(Human Welfare)
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Customers
Front-line people
Middle Management
TopManagement
Modern Marketing Concept Traditional Organization Chart
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Modern Marketing Concept Customer-Oriented Organization Chart
Customers
Front-line people
Middle management
Topmanage-
ment
Customers Cus
tom
ers
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To accompany A Framework for Marketing Management, 2nd Edition Slide 25 in Chapter 1
Simple Marketing SystemSimple Marketing System
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Core Concepts of Marketing
Needs, wants, and demands
Productsand services
Value and satisfaction
Exchange, transactions,
and relationships
Markets
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The Marketing Mix
Developed to achieve the company’s objectives.
Also called:
4 P’s of
Marketing
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Product
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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.
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Product Mix
• Total sum of all products and variants offered by an organization
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Five Product Levels
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‘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
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Product Differentiation
• Product form• Features• Customization• Performance• Conformance• Durability• Reliability• Repairability• Style
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Service Differentiation
• Ordering ease• Delivery• Installation• Customer training• Customer consulting• Maintenance and repair
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Product Life Cycle
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Some products are just great..
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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
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Some Products That Failed..
Source: http://lilomag.com/2011/01/31/top-10-failed-products/
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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..
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• 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.
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• 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
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• 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.
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New Product Testing
• It means that before the full-scale commercialization of new products, launching them into test markets to test its viability.
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• 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
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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
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PRICE
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Definition:
• In ordinary usage, price is the quantity of payment or compensation given by one party to another in return for goods or services.
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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
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Pricing Strategies
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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
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Place
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Marketing Channels and Supply Chain Management
The fourth ‘P’ of marketing
(place)
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How a Distributor Reduces theNumber of Channel Transactions
= Customer= Customer= Manufacturer= Manufacturer
11
3322
445566
778899
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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
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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
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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
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Channel Management DecisionsChannel Management Decisions
SelectingSelecting
FE
ED
BA
CK
MotivatingMotivating
TrainingTraining
EvaluatingEvaluating
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Promotion
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Concept of ‘Promotion’
• Promotion is all personal and impersonal efforts by a seller to
– Inform
– Persuade or
– Remind a target audience.
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Promotion includes:
• Personal Selling
• Advertising
• Sales Promotion
• Public Relations (PR)
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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
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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
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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
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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
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Marketing Concept - The 4 P’s && The 4 Cs
MarketingMix
Product
PricePromotion
Place
CustomerSolution
CustomerCost Communication
Convenience
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Marketing Concept - The 4 P’s
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The extended marketing mix
Also called the service marketing mix
• People
• Process
• Physical Evidence
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STP
• Segmentation
• Targeting
• Positioning
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Glimpse of Marketing Specializations
– Consumer Behavior– Marketing Research– Sales and distribution– Integrated Marketing Communications– Services Marketing– International Marketing– Brand Management