marketing and its fundamentals
TRANSCRIPT
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What is Marketing…??Selling?Advertising?Promotions?Making products available in stores?Maintaining inventories?
All of the above, plus much more!
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Marketing = ?
Marketing is the process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods, services to create exchanges that satisfy individual and organizational goals
American Marketing Association
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Marketing = ?
Marketing management is the art and science of choosing target markets and getting, keeping, and growing customers through creating, delivering, and communicating superior customer value.
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Simple Marketing System
Industry(a collection
of sellers)
Market(a collection
of Buyers)
Goods/services
Money
Communication
Information
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Marketing = ? Marketing is the sum of all activities that take you to a
sales outlet. After that sales takes over. Marketing is all about managing the four P’s –
product price place promotion
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The 4 Ps & 4Cs
MarketingMix
Product
Price Promotion
Place
CustomerSolution
CustomerCost
Communication
Convenience
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Difference Between - Sales & Marketing ?
Salestrying to get the customer to want what the company produces
Marketing trying to get the company produce what the customer wants
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Scope – What do we market Goods Services Events Experiences Personalities Place Organizations Properties Information Ideas and concepts
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Core Concepts of Marketing
Based on : Needs, Wants, Desires / demand Products, Utility, Value & Satisfaction Exchange, Transactions & Relationships Markets, Marketing & Marketers.
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Needs, wantsdemands
Markets Marketing &Marketers
Utility, Value &Satisfaction
Xchange, TransactionRelationships
Products
Core Concepts of Marketing
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In order to understand Marketing let us begin with the Marketing Triangle
Customers
CompetitionCompany
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Who is a Customer ??
Anyone who is in the market looking at a product / service for attention, acquisition, use or consumption
that satisfies a want or a need
CUSTOMER IS . . . . .
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Customer –
CUSTOMER has needs, wants, demands and desires
Understanding these needs is starting point of the entire marketing
These needs, wants …… arise within a framework or an ecosystem
Understanding both the needs and the ecosystem is the starting point of a long term relationship
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How Do Consumers Choose Among Products & Services?
Value - the value or benefits the customers gain from using the product versus the cost of obtaining the product.
Satisfaction - Based on a comparison of performance and expectations. Performance > Expectations => Satisfaction Performance < Expectations => Dissatisfaction
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Customers - Problem Solution
As a priority , we must bring to our customers “WHAT THEY NEED”
We must be in a position to UNDERSTAND their problems
Or in a new situation to give them a chance to AVOID the problems
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Customer looks for ValueValue = Benefit / Cost
Benefit = Functional Benefit + Emotional Benefit
Cost = Monetary Cost + Time Cost + Energy Cost + Psychic Cost
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Strategic Marketing
Strategic marketing management is concerned with how we will create value for the customer
Asks two main questions What is the organization’s main activity at a
particular time? – Customer Value What are its primary goals and how will these be
achieved? – how will this value be delivered
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Strategic Planning
Strategic Planning is the managerial process of creating and maintaining a fit between the organization’s objectives and resources and the evolving market opportunities.
Also called Strategic Management Process All organizations have this Can be Formal or Informal
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The Strategic-Planning, Implementation, and Control Process
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Business Strategic-Planning Process
External environment
(Opportunity &
Threat analysis)
Internal Environment
(Strength/ Weakness analysis)
Goal FormulationBusiness Mission
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Strategy FormulationEnvironmental Analysis
Internal AnalysisCompetitorCustomerSupplier
RegulatorySocial/ Political
Technology Know-HowManufacturing Know-How
Marketing Know-HowDistribution Know-How
Logistics
Strength & Weaknesses
Identity Core Competencies
Opportunities & Threats
Identify opportunity
Fit internal Competencies with external opportunities
Firm Strategies
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The Marketing Plan
A written document that acts as a guidebook of marketing activities for the marketing manager
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CONTENTS of MARKETING PLAN Business Mission StatementObjectivesSituation Analysis Marketing Strategy
Target Market Strategy Marketing Mix
Positioning Product Promotion Price Place – Distribution People Process
Implementation, Evaluation and Control
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The Marketing Process
Business Mission Stateme
nt
Objectives
Situation Analysis
Implementation Evaluation,
Control
Target Market Strategy
Marketing Strategy
Product
Promotion
Place/Distribution
Price
Marketing Mix
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Why a product like radio declined and now once again
emerging as an entertainment medium ?
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What Were the Drivers of This Change ?
Technology ?
Government policy ?
Other media substitutes ?
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Factors Influencing Company’s Marketing Strategy
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Demographics
SocialChange
EconomicConditions
Political & Legal Factors
Technology
Competition
EnvironmentalScanning
Target Market
ProductDistributionPromotion
Price
External Environment is not controllable Ever-Changing
MarketplaceExternal Marketing Environment
Physical / Natural
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The macro-environment
is the assessment of the external forces that act upon the firm and its customers, that create threats & opportunities
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P r o d u c tP r o d u c t
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Anything that is offered to the market for attention, acquisition, use or consumption that
satisfies a want or a need
Product is . . . . .
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Types of Products
ConsumerProducts
IndustrialProducts
PRODUCTS
Services
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Product Items, Lines, and Mixes
Product Item
Product Line
Product Mix
A specific version of a product that can be designated as a distinct offering among an organization’s products.
A group of closely-related product items.
All products that an organization sells.
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Product Mix
Width – how many product lines a company has
Length – how many products are there in a product line
Depth – how many variants of each product exist within a product line
Consistency – how closely related the product lines are in end use
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What is a Service? Defining the Essence
An act or performance offered by one party to another (performances are intangible, but may involve use of physical products)
An economic activity that does not result in ownership
A process that creates benefits by facilitating a desired change in customers themselves, or their physical possessions, or intangible assets
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Some Industries - Service Sector
Banking, stock broking
Lodging
Restaurants, bars, catering
Insurance
News and entertainment
Transportation (freight and passenger)
Health care
Education
Wholesaling and retailingLaundries, dry-cleaningRepair and maintenanceProfessional (e.g., law,
architecture, consulting)
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Classification of Services
Pure Tangible Product
Materials / Components
Computers
Major Product withMinor Services
Product = Service
Major Service withMinor Product
Business Hotels
Good Transportation
Banking Pure Intangible Service
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Intangibility – Services are intangibility cannot be seen, tasted, felt, heard or smelled before purchase.
Inseparability - Services are produced and consumed simultaneously.
Variability or Heterogeneity – Services are highly variable
Perishability – Services cannot be stored.
Non Ownership - Services are rendered but there is no transfer of title
Major Characteristic of Services
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The Marketing Mix
The conventional view of the marketing mix consisted of four components (4 Ps): Product, Price, Place/ distribution and Promotion.
Generally acknowledged that this is too narrow today; now includes , Processes, Productivity [technology ]People [employees], Physical evidence
Marketers today are focused on virtually all aspects of the firm’s operations that have the potential to affect the relationship with customers.
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The “8Ps” of Integrated Service Management vs. the Traditional “4Ps”
► Product elements► Place and time► Process► Productivity and quality► People► Promotion and education► Physical evidence► Price and other user outlays
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The Give and Get of Marketing
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Great Words on Marketing
1. “The purpose of a company is ‘to create a customer…The only profit center is the customer.’”
2. “A business has two—and only two—basic functions: marketing and innovation. Marketing and innovation produce results: all the rest are costs.”
3. “The aim of marketing is to make selling unnecessary.”4. “While great devices are invented in the Laboratory, great
products are invented in the Marketing department.”5. “Marketing is too important to be left to the marketing
department.”
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Drivers of Customer SatisfactionMany aspects of the firm’s value proposition contribute
to customer satisfaction: The core product or service offered
Support services and systems
The technical performance of the firm
Interaction with the firm and it employees
The emotional connection with customers
Ability to add value and to differentiate as a firm focuses more on the top levels
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Marketers and MarketsMarketers are focused on stimulating
exchanges with customers who make up markets – B2C or B2B.
The market is comprised of people who play a series of roles: decision makers, consumers, purchasers, and influencers.
It is absolutely essential that marketers have a detailed understanding of consumers, their needs and wants.
Much happens before and after the sale to affect customer satisfaction
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Stages of Customer Interaction
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What Changed in Marketing…
• Organize by product units• Focus on profitable transactions• Look primarily at financial
scorecard• Focus on shareholders• Marketing does the marketing• Build brands through advertising• Focus on customer acquisition• No customer satisfaction
measurement• Over-promise, under-deliver
• Organize by customer segments• Focus on customer lifetime value• Look also at marketing scorecard
• Focus on stakeholders• Everyone does the marketing• Build brands through performance• Focus on customer retention• Measure customer satisfaction and
retention rate• Under-promise, over-deliver
Old Economy New Economy
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Myth 1 – The larger the range of products, the more customer-centric I am.
Mythbuster – The range of products has Mythbuster – The range of products has emerged from beingemerged from beingcompetition-centric.competition-centric.
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Myth 2 – Better technology leads tobetter customer service.
Mythbuster – TechnologyMythbuster – Technologyalone does not deliver, alone does not deliver, helps people do.helps people do.
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Myth 3 – Launch a product and the customer will startusing instantly.
- Give a customer a card and he will learn how to play with it immediately
Mythbuster – Customers needMythbuster – Customers needTo be educated too…To be educated too…
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Mythbuster – Customers Mythbuster – Customers are not only present are not only present where competition is.where competition is.
Myth 4 – The only way to get a customer is from
competition.
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Myth 5 – Just advertise and - You will sell.
Mythbuster – Advertising will only sell, Mythbuster – Advertising will only sell, Not retain customers. Not retain customers.
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Myth 6 – No difference between marketing & selling
Mythbuster – Mythbuster – “Selling focuses on the needs of the “Selling focuses on the needs of the seller; marketing on the needs of the buyer. seller; marketing on the needs of the buyer.
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Myth 7 – In the absence of relationships ‘trust’ builds financial brands
Mythbuster – TMythbuster – Trust is not a differentiator at all…rust is not a differentiator at all…it is the very minimum that the customer expects!!it is the very minimum that the customer expects!!
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So what will the differentiators be :So what will the differentiators be :
• Technology ?
• Brand ?
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The real differentiator of The real differentiator of customer – centricity in a customer – centricity in a commoditised world of commoditised world of financial products - financial products -
Customer Service !Customer Service !
