PREPARED BY:NEERAJ SHARMA

MPHIL (MANAGEMENT)

KEY CONCEPTS OF MARKETING&

FACTORS AFFECTING MARKET DECISIONS

TOPICS TO BE COVERED….. What is market? Today’s Market Scenario What is Marketing? Marketing Process What Smart companies do? What contributed to the Renault Duster's

success?? Why Nokia fails.. Factors affecting Market decisions Internal environment External environment

What is Market?? In the words of layman Market is a place where goods are physically present and

we go there for purchasing it. For him, market is fish market, vegetable and fruit market,

meat market, grain market. He thinks market is any geographical place where lots of

goods are present . But in actual, market is not necessarily a geographical

location. Products and services are purchased over the phone, through mail / electronic mail, online through internet.

Market is an arrangement in which two parties are involved: One party(seller)who agrees to sell the goods. Other party (buyer) who agrees to pay for the goods

purchased

Today's Market Scenario Huge competition Buyers are price sensitive Buyers have high service expectations Buyers are quality conscious Buyers expect more features in the product. To deal with these problems, the companies have

to do more efforts to understand the customer needs and to satisfy them.

In today’s economy, customer who buys the product is at the center of business universe. Companies revolve around the customer.

What is Marketing?? Marketing is the sum total of all activities which

aims at identifying, satisfying and retaining the customers

Marketing is getting and keeping the customer. (Theodore Levitt)

It begins before manufacturing It is much more than just selling stuff and

collecting money. Marketing has a long term perspective. It’s the connection between people and products,

customers and companies.

Marketing process

Market Research

Segmentation , Targeting and Positioning

Marketing Mix

Implementation

Control

What Smart Marketing companies do??

They are improving their customer knowledge, understanding customer economics and using customer connection technologies

they are inviting customers to co design the product

they are using more targeted media and integrating market communications to deliver a consistent message through every customer contact

They are reachable seven days a week and 24 hours a day at their toll free no. and by emails.

What contributed to the Renault Duster's success??

"The Logan's failure reminded us of the importance of understanding the customer, getting the product right and positioning the Duster correctly at the time of the launch," says Marc Nassif, Managing Director, Renault India.

The company identified a focus group of about 200 people whose profile matched the potential buyer of the Duster.

The study threw up 41 modifications that the European Duster needed.

They understood that a critical purchasing factor of a car in India is the exterior design

People loved an SUV with rugged looks that stood out in a crowd, but at the same time they wanted it to operationally perform like a sedan - easy to drive and offering good fuel efficiency.

Inside the car they preferred a dual-tone interior, and wanted the switches for power windows on the door rather than in the central console.

Indians preferred inclined seats for greater comfort.

Why Nokia fails..

Fails to understand the customer’s changing tastes and preferences.

Unable to deliver the right message like Strong value proposition of Nokia mobile phones.

FACTORS AFFECTING MARKET DECISIONS

There are forces inside or outside the company that affect marketing managements’ ability to build and maintain successful relationships with target customers.

Marketing Environment

Internal environment

External environment

Internal/Micro environment

Micro environment consists of the actors close to the company and affect its ability to serve its customers such as company , suppliers, market intermediaries, customers, competitors and the public.COMPANY

SUPPLIERS

PUBLICS

MARKET INTERMEDIARIESCOMPETITORS

CUSTOMERS

MARKETING

THE COMPANY In designing marketing plans, marketing management

takes other company groups into account such as top management, finance, research and development, purchasing, operations and accounting.

Should work in harmony to provide superior customer value and satisification

COMPANY’S INTERNAL

ENVIRONMENT

TOP MANAGEM

ENT

FINANCE

PURCHASING

PRODUCTION

RESEARCH AND

DEVELOPMENT

ACCOUNTING

SUPPLIERSSuppliers provide the resources needed by the

company to produce its goods and services. Important link in the value delivery system.

o Problems related with suppliers –

Shortages of supplies, delays in

supply, labor strikes.o Marketers must maintain

the relations with multiple

suppliers

MARKETING INTERMEDIARIES

Marketing intermediaries help the company to promote, sell and distribute its products to final buyers. They include-

Resellers- Wholesalers, Retailers, Agents, Brokers, Dealers

Marketing service agencies - Advertising agencies, Consultancy firms etc.

Financial intermediaries - banks, insurance companies etc.

Physical distribution firms - Warehousing firms, transportation firms.

CUSTOMERSThe company needs to study 5 types of customers

closely-

Should identify the differences in customer characteristics and segment the customers in different groups.

TYPES OF CUSTOMERS

CONSUMER

MARKETS

BUSINESS

MARKETS

RESELLER

MARKETS

GOVT. MARKETS

INTERNATIONAL MARKET

S

COMPETITORSCompetitor means other business units which are

producing or marketing similar products or a very close substitute of our product.

Cut throat competition in FMCGs like soft drinks, detergents, shampoo, toothpaste etc.

• Must understand competitor’s strengths and weaknesses.

• Must differentiate firm’s products and services from those of competitors

THE PUBLIC

A public is any group that has an actual or potential interest in or impact on an organization ability to achieve its objectives.

TYPES OF PUBLIC

FINANCIAL

PUBLICS

MEDIA PUBLICS

GOVT. PUBLICS

LOCAL PUBLICS

INTERNATIONAL PUBLICS

External /Macro Environment

The forces that affect the microenvironment. It includes-

ECONOMIC FORCESCULTURAL

FORCES

POLITICAL FORCES

MARKETING

TECHNOLOGICAL FORCES

NATURAL FORCES

Considered to be beyond the control of organization

DEMOGRAPHIC FORCES

DEMOGRAPHIC ENVIRONMENT

Demography is the study of human population in terms of size, density, location, age, gender, race, occupation etc.

Helps in market segmentation and targeting.Demographic trends

o Changing Family structureo Higher education level

ECONOMIC ENVIRONMENT consists of factors that affect consumer buying power and

spending patterns. Economic conditions affect the product planning, price

fixing, promotion policies etc. Distribution of income- - upper class - middle class - working class - underclass Various phases of trade cycles Employment level

NATURAL ENVIRONMENT

Natural environment involves the resources that are needed as inputs by marketers or that are affected by marketing activities.

The marketers must be aware of - Climatic and weather conditions –

Example - In hilly areas, jeeps are

in greater demand than carsNatural calamities leads to shortages of raw

materials.

TECHNOLOGICAL ENVIRONMENT

Technological discoveries and developments create opportunities and threats in the market like automobiles, T.V., personal computers, cell phones etc.

o Rapid change in technologyo - shorter product life cycleo Higher R & D budgets o Increased competition

POLITICAL ENVIRONMENT

Consists of laws, govt. agencies and pressure groups that influence or limit various organizations and individuals in a given society.

Increasing legislation Govt. policies for economic

growth like LPG , FDI policy , subsidies etc.

CULTURAL ENVIRONMENT

Includes Forces that affect a society’s basic values, perceptionsand behaviours.

Core cultural values Secondary cultural values.

Cultural factors affects the marketing strategy, promotion policies etc.

Differences in religionLanguage differences

THANK YOU