marketing for managers

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Marketing for Managers

Rubina D‟Mello



Contents Marketing an Its Applications

Marketing planning and Organisation

Understanding Consumers

Product Management

Pricing an Promotion Strategy Distribution and Public Policy



Block 1

Marketing and its Applications



Chapter 1

Introduction to Marketing



The Meaning of Marketing

Marketing is the performance of business

activities that directs the flow of goods andservices from producer to consumer or user

PRODUCER

Product

CONSUMER

Need

Marketing activities



The Marketing Mix

C

Product

Price

Promotion

Place



Marketing StrategyNeeded to create and retain a satisfied

customers

Strategies

STDP Strategies

Marketing Mix Strategies



STPD Strategies Segmentation

Aggregating process – A cluster of people with

similar needs.

A Homogeneous group of customer who willrespond to a marketing mix in a similar way.

Targeting Once the market segment is defined, it has to

decide how many and which one to target.



Differentiation Product Differentiation

Service Differentiation Channel Differentiation

Personnel differentiation

Positioning It‟s a perception about your offering in the

minds of the consumer.



Product Mix StrategiesWhat is Product Mix

Set of all products offered by an

organisation to its customersConsists of

Width

Length Depth

Consistency



Case Study

Product-lineLength

Product-Mix Width

Beverages Juice Snacks

Pepsi

Mountain Dew

Aquafina

Mirinda

7-Up

Dukes SodaDukes Mangola

Slice

Tropicana

Orange

Nature Sweet

Apple

Grape

Pineapple Tomato

Mixed Fruit

Lays

Cheetos

Lehar

Numkeens

Nutyumz

Kurkure

Product-Mix Width and Product-Line Length for PepsiCo India



Strategy of Product Mix Expansion of product mix

Contraction of product mix

Altering existing products

Positioning the product



PlaceIs concerned with all the decisions involved in the getting right product to

the target market‟s place.

Distribution Channels – any series of firms that

participate in the flow of products from producer to its finalconsumers.

Manufactures or producer

Consumer

Nestle

Wholesaler

Wholesaler

Retailer

Wholesaler

Retailer

Toyota

Retailer

Raymond's



Promotion Mix Strategy

Push Strategy

directing communications to channel

members Pull Strategy

directing communications to end users

Factors type of product/market

buyer readiness stage

product life-cycle stage



Chapter 2

Marketing in a Developing Economy



Marketing functions performed atdifferent levels of development



Relevance of Marketing in adeveloping economy

Marketing and planned economic growth

How to view the marketing effort

Significance of macro and micro marketing

General role of marketing

Stimulates potential aggregate demand and thusenlarge the size of the market

It helps in the discover of entrepreneurial talent



Areas of Relevance

Marketing in agriculture, basic industries, miningand plantation

Intermediate industrial goods Semi-industrial products

Export trade & services like tourism and banking



The Relevance of Social Marketing

4 P‟s

Social Marketing planning system



Chapter 3Marketing of services



The service sector

The services sector has been growingat a rate of 8% per annum in recent

years More than half of our GDP is accounted

for from the services sector

This sector dominates with the best jobs, best talent and best incomes



“There are no such thing as

service industries.There are onlyindustries whose service

components are greater or less

than those of other industries.Everybody is in service.”

-Theodore Levitt-



What is services?

It is the part of the product or thefull product for which the customer

is willing to see value and pay for it.



Growing Importance of Services

Economic well being increases thedemand of services

Changing lifestyle

Complexity of the product



Characteristics of Services Intangibility

Perishability

Inseparability

Variability Client relationships

Right of owner-ship



Intangibility

Hard to grasp, concept is abstract

Dramatization often necessary for concept

Hard to separate the service provider and the service



Perishability Services cannot be stored or held in

inventory.

If not used when available, they “go to

waste”.



Inseparability

Outlet accessibility can limit the area covered

by the service.

Image is important: Image affects the

perception of the service.



Variability Service quality tends to vary

considerably.

Haircut from your hair dresser vs.

“Javed Habib”



Client Relationships Relationships between service organizations

and customers are often close

Potential for loyalty longterm



Right of owner-ship It is not taken to the service, we merely

experience it.

e.g. Services of a doctor, lawyer, teacher,

mechanic, etc..



Difference between physicalgoods and services

Physical goods Services

tangible intangible

homogeneous heterogeneous

Production and distribution areseparated from consumption

Production, distribution andconsumption are simultaneousprocesses

A thing An activity or process

Core value processed in factory Core value produced in the buyer-

seller interaction

Customers do not participate inthe production process

Customers participate inproduction

Can be kept in stock Cannot be kept in stock

Transfer of ownership No transfer of ownership



SERVICES MARKETING MIX

Product

Place

Prize

Promotion

People Physical Evidence

Process



In services, the lastexperience remains uppermost

in your mind. Therefore, it isnot enough to be good, you

have to be consistently good



Service quality is directlyproportional to employeesatisfaction



Block 2

Marketing Planning and Organisation



Chapter 4

Planning Marketing Mix



The Elements of Marketing Mix

Product activities Quality, features, style, brand name, packaging, sizes,

services, warranties, returns

Pricing activities

Target customers, cost, competition, the law, socialresponsibility

Promotional activities Advertising, personal selling, sales promotion, publicity and

public relations

Place or Distribution related activities

Physical distribution Transportation, warehosuing and storage, Order processing,

Inventory control, Location

Channels of distribution



The Place of the Marketing Mix inMarketing planning

Current Marketing Situation

Identification of Problems and Opportunities

Defining Objectives Designing the Marketing Strategy

Developing the marketing programme



The Relationship between Marketing Mixand Marketing Strategy

The concept of Optimum Marketing Mix



Marketing Mix and some specific Situation

New product development andmarketing mix

Product life cycle and marketing mix

Role of Advertising in marketing mix

Role of price in marketing mix



TheProductLife Cycle



Chapter 5

Market Segmentation



The Concept of Market

In respect of the network of institutions likewholesalers and brokers dealing in a product

To refer to the nature of demand for theproduct, as when we speak of the market forsoap



The concept of segmentation

Relationship of a segment to a market

Market Segmentation versus productdevelopment

Benefits and doubts about segmentation

What is grouped in forming segments

What, how, where, when, why, who



Bases for Segmentation

Occasions, Benefits,Uses, or Attitudes

Behavioral

Demographic

Age, Gender, Family sizeand Life cycle, Race,Occupation, or Income ...

Lifestyle or Personality

Psychographic

Geographic

Region, City or MetroSize, Density, Climate



Segmenting Business Markets…Contd.

Bases

for Segmenting

Business

Markets

DemographicsPersonal

Characteristics

SituationalFactors

OperatingCharacteristics

PurchasingApproaches



How is the basis for segmentation selected?

Methods that companies use

Logical division

Perceptual mapping technique Considerations in using perceptual maps



Selection of Segments

General factors Company trust

Size & growth potential

Investment needed Profitability

Risk

Competition

Specific Segmentation factors Segment durability

Mobility

Visibility

accessibility



Chapter 6

Marketing Organisation



Principles of Designing an Organisation

Specialisation

Departmentalisation

Standardisation Formalisation

Centralisation

Evaluation

Structure




The changing role of Marketing Organisation Simple sales department Sales department with some marketing function Separate marketing department

Integrated marketing department Marketing oriented organisation

Considerations involved in designing the marketing organisation Statement of objective and goals of the firm Nature of the product/Line of activity Areas of operation Nature of Industry Computerisation & up-gradation of information system External environment & Government intervention.




Methods of designing the Marketing Organisation

Functional Organisation

Product Management Organisation

Market Centered Organisation

Organisation of Corporate Marketing

No corporate marketing support

Minimal corporate marketing support moderate corporate marketing

Strong corporate marketing



Chapter 7

Marketing Research & Its Applications



The Context of Marketing Decisions Definition of Marketing Research Purpose of Marketing Research Scope of Marketing Research Marketing Research Procedure

Problem Definition Research design Field Work Data Analysis Report presentation and implementation

Marketing Research in India Problems of conducting marketing research



Application of Marketing Research

Sales & Market Analysis Determination of market potential Determination of market share Sales forecasting Design of market segmentation studies Target market Distribution channel studies Determination of market characteristics Determination of competitive information

Product Research

Evaluation of new product ideas Testing for new product acceptance Evaluating the need for change in product information Testing package design Testing of product positioning



Application of Marketing Research

Business Economics and corporate research Studies of business trends Pricing studies Diversification studies

Product mix studies Plant & warehouse location studies

Advertising Research Audience Measurement Determining the most cost effective media plan Copy Testing Determining advertising effectiveness Consumer behaviour research



Block 3

Understanding Consumers



Chapter 8

Determinants of Consumer Behaviour



Importance of consumer behaviour formarketers

Types of consumers Buyers v/s Users

Figure 16.2 A Simple Model of Consumer Decision Making



g p g

Firm’s Marketing Efforts

1. Product

2. Promotion3. Price

4. Channels of distribution

Sociocultural Environment

1. Family

2. Informal sources3. Other noncommercial sources

4. Social class

5. Subculture and culture

Need Recognition

Prepurchase Search

Evaluation of Alternatives

Psychological Field

1. Motivation2. Perception

3. Learning

4. Personality

5. Attitudes

Experience

Purchase

1. Trial

2. Repeat purchase

Postpurchase EvaluationOutput

Process

Input

External Influences

Consumer Decision Making

Postdecision Behavior

Factors influencing consumer behaviour



ProblemRecognition

Informationsearch

Purchasingdecision

Postpurchasebehaviour

attitudes

personalitymotivation

learning perception

External Environment

Individual Determinants

culture

family

social group social class

subculture

others

Factors influencing consumer behaviour



Chapter 9

Models of Consumer Behaviour



What is a decision?

Process of decision making

Involvement

Alternative differentiation

Time pressure

T pes of Cons me Decision



Types of Consumer DecisionMaking

What to buy

How much to buy

Where to buy

When to buy

How to buy

l f C i i



Levels of Consumer DecisionMaking

Buying Roles

Buying Behaviour

Extensive problem solving

Routinized buying behaviour

Variety seeking behaviour



Stages in the Buyer Decision Process

Identify theproblem

recognition

Gather informationabout the

product and

brands

Evaluate thealternativesand selectthe best

possiblealternative

Purchase

decision/buying theproduct

Post purchase

Evaluation

• Post purchase useand disposal



Models of Buyer Behaviour

Horward-Seth Model Inputs Perceptual & learning constructs Outputs Exogenous or external variable

Engel-Kollat-Bloackwell Model Information processing Central control unit Decision process Environmental influences

Model of family decision making

Influencers Gatekeepers Deciders Preparers Buyers users

Model of industrial buyer behaviour

Chapter 10



Chapter 10

Indian Consumer Environment

Demographic Characteristics

Income and consumption characteristics Characteristics of organisational consumers

Geographic characteristics

Market potential

Socio cultural characteristics



Block 4

Product Management



Chapter 11Product decision and strategies



Product

Physical goods

Services Experiences

Events

Persons

Places

Properties

Organizations

Information

Ideas

Anything that can be offered to a market to satisfy a want or need



The fundamental service or product the customer is buying

In a bank the customer is looking for

security of his money

Marketer has to turn core benefitinto basic product Bank accounts like savings account,

current account

A set of attributes and conditions the buyersexpect when they buy the product The bank customer would expect a cheque book,

locker and other deposit products like FD, RD

A product that exceeds customer

expectations A bank can offer facilities like ATM/Debit

cards, Telebanking, Internet Banking and

also other financial services

Encompasses all possibleaugmentation and transformationsthe product might undergo in future Anywhere banking, ATM sharing, CRM

priority banking, portfolio management

Product Levels



Product Mix

Product mix has a certain…

Width

Length

Depth

Consistency

Case Study



Case Study

Product-lineLength

Product-Mix Width

Beverages Juice Snacks

Pepsi

Mountain Dew

Aquafina

Mirinda

7-Up

Dukes Soda

Dukes Mangola

Slice

Tropicana

Orange

Nature Sweet

Apple

Grape

Pineapple

Tomato

Mixed Fruit

Lays

Cheetos

Lehar

Numkeens

Nutyumz

Kurkure

Product-Mix Width and Product-Line Length for PepsiCo India



Case Study

Print RetailEntertainmentNet

The Times Group

The Times Group contd..




Print




GROUP SITES


Net





Entertainment





Retail



Product Line Decisions

B. Product line Lengtha. Objectives

b. Cycle

1. Line Stretching a. Down market Stretch

b. Up market Stretch

c. Two way stretch

2. Line Filling Just-noticeable difference

3. Line Modernization, Featuring and Pruning

Chapter 12



Product Life cycle and New ProductDevelopment

The Product Life Cycle Concept

Marketing Mix at different stages



Strategy Introduction Growth Maturity Decline



1. Objective Aggressive Entry Maximize Share Boast

Profits

Milk

Products

2. Focus Non- Users New Segments Defend

Share

Cut Costs

3.Customer

Targets

Innovators Early

Adopters

Majority Laggards

4.Competitor Few Growing Number Many Declining

5.Differentiated Advantage

ProductPerformance

Brand Image Price & Service Price

Marketing MIX Introduction Growth Maturity Decline

1. Product Basic Extension &Enhancement

Differentiation

& Variety

Rationalize

Range

2. Price High Lower Lower Stabilizing

3.Promotion High High Falling Low

4. Advertisement

Forms.

Awareness BrandPerformance

Loyalty Selective

5.Distribution Selective Intensive Intensive Rationalize



New Product Development Strategy

Stages in new product development

Ideas generation

Screening of ideas Concept testing

Product designing and evaluation

Product testing

Product launching



Chapter 13

Branding and packaging decison



Branding

Definition: “A brand is a name, Term, Sign, Symbol,

Brand or combination of them intended to identify

the goods or services of one seller or group of sellers and to differentiate them from those of

competitors.”

-American Marketing Association

•Trademarks – legal right to the exclusive use of that name or mark

Challenges in Branding and



Challenges in Branding anddecisions

Branding to be or not to be..

Whether Produce Manufacturer Brands or

Distributor / Private BrandsWhich Brand Name/s to use

Whether to use Line extensions, Brand

Extensions, Multi Brands, New Brands or

Cobrands



Brand Name Features

suggest something about the product‟sbenefits

suggest the product or service category

suggest concrete, “high imagery” qualities

be easy to spell, pronounce, recognize, andremember

be distinctive

not carry poor meanings in other countries andlanguages

A Brand name should



Packaging

What is packaging

Packaging Industry Used materials : Metals, plastics, wood, paper, glass, laminates, polysters,

etc.

Functions of packaging Protection, Appeal Performance Offer convenience to the end-users Cost effective

Legal dimensions of packaging Statutory requirements

Net weight, when packed Date of manufacture Date of expiry Directions of storage MRP Directions for use



Block 5

Pricing and Promotion Strategies



Chapter 14

Pricing policies and practices

Price



Price

• Three variables that determine profit:

Sales

Volume Price X Cost Profit - =

Price

Customer Seller

Benefit



Determinants of Price

Demand

Competition



Setting the Price



Premium

Strategy(Mercedes,Evian)

Overcharging

Strategy

(Cielo)

Good-Value

Strategy(Amul)

Economy

Strategy(Akai,OK)

Price

Higher Lower

Higher

Lower

Q u a l i t y

Pricing StrategiesPrice-Quality Strategies

C t P i i Obj ti



•Survival•Low Prices to Cover Variable Costs and Some Fixed Costs to Stayin Business.

•Current Profit Maximization•Choose the Price that Produces the Maximum Current Profit, Etc.

•Market Share Leadership•Low as Possible Prices to Become the Market Share Leader.

•Product Quality Leadership•High Prices to Cover Higher Performance Quality and R & D.

•Market Skimming•Initially setting up High Prices to Skim the market

Corporate Pricing Objectives

S l ti th P i Obj ti



Survival(Mobile Operators)

Maximum marketskimming

(Nokia Handsets / Intel Micro Chips)

Product-qualityleadership

(Maruti)

Maximum currentprofit

(Aiwa)

Maximum marketshare(Kodak KB)

Selecting the Price Objective

Estimating Cost



Estimating Cost

Total CostsSum of the Fixed and Variable Costs for a Given

Level of Production

Fixed Costs (Overhead)

Costs that don’t vary with sales or production levels.

Executive SalariesRent

Variable Costs

Costs that do varydirectly with the

level of production.

Raw materials



Markup Pricing

Target Return Pricing

Perceived Value Pricing

Value Pricing

Going-Rate Pricing

Sealed-Bid Pricing

Selecting a Pricing Method



Pricing Methods

Markup price = unit cost

(1-desired return on sales)Where unit cost is variable cost + (fixed cost/unit sales)

Target return pricing (target ROI) =

Unit cost + desired return X invested capitalUnit sales

Break even volume = fixed cost

Price – variable cost



Value-based Pricing

Pricing strategy reflects the beliefs and

attitudes of the customer.

Perceived price/quality relationship.

Price is based on an understanding of the

value of the product as perceived by thecustomer.

Pricing Methods

V l B d P i i



Value-Based Pricing

Product

Cost

Price

Value

Customers

Customer

Value

Price

Cost

Product

Cost-Based Pricing Value-Based Pricing

START



Going-Rate

Company Sets Prices Based On What Competitors Are

Charging.

Sealed-Bid

Company Sets Prices Based On What They Think

Competitors Will Charge.

Pricing Methods



Selecting the Final Price

Psychological pricing

Sometimes price is equated to quality Reference Price

Influencing of other marketing-mix elements The final price must be take in to account the brands quality

and advertising relative to competition

Company pricing policies The Price must be consistent with company pricing policies

Impact of price on other parties such as dealers and distributors

Geographical Pricing

http://www.bata.com/home.htm



Marketing Management – Philip Kotler

Harry Potter –

J. K. Rowling

Adjusting prices to account for the Geographical Locationof Customers

US Price $124.67India Price Rs. 310

US Price $17.99India Price Rs. 636

g p g



Discount & AllowanceReducing Prices to Reward

Customer Responses such asPaying Early or Promotingthe Product.

Cash Discount

Quantity Discount

Functional Discount

Seasonal Discount

Trade-In Allowance Promotional Allowance

Promotional Pricing



• Reducing Prices to Increase Short-Run Sales

• Reducing Prices to Reward Customer Responses suchas Paying Early or Promoting the Product.

Promotional Pricing

http://www.godrej.com/vmv.htm



Product mix

Product-Mix Pricing Tactics:

Product-line Pricing

Optional-feature pricing

Captive-product pricing

Two-Part Pricing

By-Product Pricing

Product-Bundle Pricing

Product Mix Pricing Strategies



Optional-Product Pricing

Pricing Optional or Accessory ProductsSold With The Main Product

i.e. Car Options such as a CD player

Captive-Product PricingPricing Products That Must Be

Used Along With The Main Product

e.g. Printer cartridges

By-Product PricingPricing Low-Value By-Products To

Get Rid of Them

e.g. Sugarcane

Product-Bundle PricingBundles Of Products Sold

Together at a Reduced Price

e.g. Gillete razor blades & foam

Product

MixPricing

Strategies

g g

Product Line Pricing



Setting Price Steps Between Product Line Items

Product Line Pricing



Analyzing Competitors ‟Cost ,Prices and Offers

The company needs to benchmark itscosts against its competitors‟cost to

learn whether it is operating at a costadvantage or disadvantage.

The company also needs to learn the

price and quality of competitors‟ offers

Assessing & Responding toCompetitor Price Changes



Hold Current Price;Continue to Monitor Competitor’s Price.

Reduce Price

Raise Perceived

Quality

Improve Quality& Increase Price

Launch Low-Price“Fighting Brand”

Has Competitor CutPrice?

Will Lower PriceNegatively Affect Our

Market Share & Profits?

Can/ Should EffectiveAction be Taken?

Yes

No

No

No

Yes

Yes

Competitor Price Changes



Chapter 15

Marketing Communication

The Communication Process



The Communication Process

Sender Encoding

Feedback Response

Noise

MessageMedia

Decoding Receiver

Marketing Communication



Marketing CommunicationMix

Advertising

MarketingCommunication

SalesPromotion

PublicRelations

PersonalSelling

DirectMarketing

The Promotion Mix



Advertising

Sales PromotionSpecial Offer

Public Relations

Personal Selling

Direct Marketing

Advertising



Mass Media Newspapers TV Radio Magazines Billboards

Eg : Johnson & Johnson

A paid nonpersonal communication

about an organization and itsproducts transmitted to atarget audience through mass media

Sales Promotion



Types of sales promotions Coupon

Point-of-Purchase

Premium: free/ reduced-price

Trade Show Contests & More

Britannia Khao World CupJao

Consists of a diverse collection of incentive tools, mostly short term,designed to stimulate quicker or greaterpurchase of particular products orservices by consumers or the trade

Public Relations & Publicity



Promotional tool Identify, establish, and

maintain beneficial relationships betweena company and its stakeholders

Benefits Corporate visibility

Image Building

Product Information

Patni Computers i-flex solutions

Personal Selling



Promotional tool in which asalesperson communicates

one-on-one with potential customers

JCI Franco Indian Pharma

Advantages

Immediate response

Tailored message

Ability to measure effectiveness

Disadvantages Relies on ability of sales rep. Expensive per contact

Direct Marketing & Others



Direct Communications with CarefullyTargeted Individual Consumers to

Obtain an Immediate Response

Catalog

Marketing

Kiosk

Marketing

Online

MarketingDirect-Mail

Marketing

Direct-Response

TV MarketingTelemarketing

Face-to-Face

Selling

Tracmail Rohini International

Push & Pull Strategy



Push Policy Promoting a product only to the next institution down the

marketing channel

Pull Policy Promoting a product directly to consumers to develop stronger

consumer demand that pulls products through the marketingchannel

Determinants of promotion mix



Determinants of promotion mix

Type of product

Determinants Target

Audience

CompanyPolicy

Budget

Stage inthe PLC

Nature of

market

Establish the Communication



Budget

AffordableBased on What the

Company Can Afford

Objective-and-Task Based on Determining

Objectives & Tasks, ThenEstimating Costs

Percentage of SalesBased on a Certain Percentageof Current or Forecasted Sales

Competitive-ParityBased on the Competitor‟s

Promotion Budget

After Determining Its Objectives, the MarketerMust Set the Communications Budget for Each

Product and Market.

Factors in designing promotion



mix strategies

Chapter 16



Advertising and Publicity

How advertising works? Types of advertising Role of advertising Advertising expenditure

Advertising management Setting advertising objective Developing advtg. Copy and message Selecting and scheduling media Measuring advertising effectiveness Coordinating with ad agency Publicity

Use of publicity Measuring effectiveness of publicity



Chapter 17

Personal Selling and Sales Promotion



Personal Selling

Role of personal Selling Types of selling jobs

Merchandise deliveries Inside order-taker Outside order-taker Missionary salesperson Sales engineer Tangible product seller Intangible product seller

The selling process Preparation Prospecting

Preapproach Approach Sales presentation Handling objectives Closing the sale Post-sale follow-up

h l ?



What is sales promotion?

Sales promotion consists of a diversecollection of incentive tools, mostly short

term, designed to stimulate quicker andor greater purchase of particularproducts/services by consumers or trade

-Kotler

“Below the line”




Non personal promotional effort thatare designed to have immediate impact

on sales Employed for a pre-determined limited

period to increase consumer demand or

stimulate market demand


Wh i l i ?




Sales promotion offers an incentive to buy

Encompasses everything that is outside of advertising, PR and DM

Uses advertising, PR and DM to deliver thesales promotion

Can be planned to increase sales over a long

period and not necessarily about immediateresults (privilege / mileage points)

Wh h SP h?



Why has SP grown so much? Results ! - immediate / quick boost to

sales

Results over finite period of time - v/s

advertising or PR Results are measurable

Easy and inexpensive to implement

Costs & efficiency of mass media /advertising has risen considerably



….

Product managers face pressure toincrease sales

Companies face more competition Consumers have become more deal

oriented

Sales Promotions work!

H d SP k?



How does SP work?

Consumer decision making process (except for low cost, low involvement impulse pur.)

- Awareness

- Information gathering

- Pre purchase evaluation

- decision

- PURCHASE

- Post purchase evaluation



- Awareness- Information gathering

- Pre purchase evaluation

- Decision

- PURCHASE

- Post purchase evaluation

Advt / PR

Per Sell

SP

SP k b



SP works because ...

It alters the price / value relationshipthat the product offers the buyer

Lowers price - use of coupons, discounts Add value - value packs, extra free

Everybody loves freebies

Consumers have a reason to purchasethe product NOW

Justifies post purchase evaluation

Ad t



Advantages

Sales promotions help shape buying patterns- Annual sales

Attract new audiences - trials for newproducts

Increase sales - freebies, buy 1 get 1 free

Increases profits

Helps move stock / liquidate inventory

Increases awareness - reach new buyers

Ad t



Advantages

Encourages the consumer to buy more thanusual on a single shopping visit

Reminder of product, especially when a newproduct / competitor is about to launch

Improving TOM recall of the brand if promo isadvertised in mass media

Demoralise newly launched brands

Di d t



Disadvantages Can seem like last minute panic measures

and that can signal failure

Can give an impression of hard sell

Greed for sales - promos are often notrelated to the strategic elements of thebrands mktg. mix

Often viewed as simple reactionary

techniques to increase sales and profits

Dilutes brand value - discount brands

S l ti t h i



Sales promotion techniques

Price deals

Discounts

Price pack deals

Samples Rebates

Sweepstakes/contests

Frequency rewards

Demos

POP

Trade allowances

Dealer loader

Trade contests

POP Displays

Training programs

Push money / Spiffs

Exhibitions

„Sams ng pinning toh inning‟



„Samsung pinning toh winning‟

All India promo

Aggressive use of mass media

Consumer gets an assured gift onpurchase of any Samsung product

100 cr worth of prizes on offer

Sms 16 digit pin and the gift u get wl bsms‟d 2 u.

Cash in on Diwali purchases

„Phod ke dekho‟ offer



„Phod ke dekho‟ offer

Consumer promotion scheme

Packaged as a coconut which cons picks

on purchase of a Samsung product Breaking the coconut reveals a chance

to win a gift

Strong consumer acceptance helped coto achieve a growth of 35% in salesover last year - same period

Test drive and win



Test drive and win Tata Motors celebrated 50 years

Offer to test drive any Tata car - fill aform - and lucky winners could win

Prize Indica V2 Petrol

Buzz / Hype / Awareness

Mass media - TV / Press / DM

Helped build / gather data base

Buzz around Petrol



Some historic cases

Developing a Sales Promotion andMerchandising Plan



g

Set sales promotion and merchandisingobjectives.

What is your target audience?

Establish a tentative sales promotion andmerchandising budget.

Select sales promotion and merchandisingtechniques.

Developing a Sales Promotion andMerchandising Plan



Select media for distributing promotions.Decide on timing of sales promotions andmerchandising.

Pretest sales promotions and merchandising.Prepare final sales promotion andmerchandising plan and budget.

Measure and evaluate sales promotion and

merchandising success.

g

10 commandments of salespromos



promos

Creativity

Know

your

target

Specificobjectives

Know

Basictechniques

Simplicity

Attngrabbing

visualsBe clear

Reinforceadvertising

Support brand

image

Coordinate

with mktg

Know

when to

break



Block 6

Distribution and Public Policy

Chapter 18S l F ti



Sales Forecasting

What is a sales forecast?

How to prepare a sales forecast?

Product sales determinants Consumer non-durable goods Consumer durable goods

Industrial goods

Approach to sales forecasting Breakdown approach Market build-up approach



Methods of forecasting Executive Judgement Surveys Time series analysis Corelation and regression methods Market tests Combining forecast and using judgement

Status of forecasting method usage The evaluation of forecasts

Computerised sales forecasting Relating the sales forecast to the sales budget an profit

planning

Chapter 19Di t ib ti St t



Distribution Strategy Importance of channel of distribution Alternative channels of distribution

Direct selling Mercantile Agents

Brokers

Commission agent Merchant Middlemen

Wholesalers Retailers

Functions performed by retailers Services rendered by the retailers

Effective coordination between wholesaler and retailers Types of retailers

Department stores Co-operative stores Multiple shops or chain stores



Role of middlemen in Indian Economy Selecting an appropriate channel

The type of product Nature and extent of the marker

Existing channels for comparable products Buying habits of consumers Cost involved in distribution

Physical distribution tasks Location of manufacturing facilities Location of warehouses Mode and method of transportation Inventory decisions Using external distribution agency

Location of fixed facilities Specific issues relating to maintenance of stocks

Chapter 20Managing Sales pe sonnel



Managing Sales personnel

Selling and sales management

Recruitment and selection of salesmen

Training of sales personnel Motivating the sales personnel

Controlling the sales personnel

Chapter 21Marketing and Public Policy



Marketing and Public Policy

Regulatory role of the government

Role of government in marketing in developingeconomy

Government control and marketing decision makingprocess

Impact of government control on product decision

Impact of government control on pricing decision

Impact of government control on promotion decision Impact of government control on channel and

distribution decision

Chapter 22Cyber Marketing



Cyber Marketing What is cyber marketing Cyber marketing and conventional marketing

Interconnectivity Interactivity Involvement Information Individualisation integrity

Cyber marketing model The nature of cyber marketing

Customer profiling, segmentation and targeting Product planning

Branding Pricing decision Advertising and sales promotion Distribution Marketing research



Limitations of cyber marketing

Limits of digitisation

Shopping experience

Security issues

Internet access density

Customers used to freebies

Dot.com bust

Attracting traffic to the internet site

What is internet ??



What is internet ??

Global network of interconnected networks.

Includes millions of corporate, government,

organizational and private networks.

Types of network forming internet

IntranetExtranet

Web

What is E- Marketing



What is E- Marketing

Process of growing & promoting an organizationusing online media

Ties creative and technical aspects of internet.

Creating, communicating and delivering value to

customers.

Managing customer relationship.

Objectives of InternetMarketing



Marketing

Create Awareness.

Generate Interest.

Disseminate Information. Create an Image.

Create a Strong Brand.

Characteristics of Internet

marketing



marketing

Relatively Inexpensive.

Wide reach.

Allows research, purchase ofproducts and services on convenience.

Quick Response.

Differentiators from offlineMarketing



Marketing

One-to-one vs. one-to-many approach

Demographics targeting vs. behavioral

targeting. Measurability .

Response and immediate results.

Limitations of E- Marketing



Limitations of E Marketing

Dependant on technology.

Rigid mindset.

Virtual aspect. Security Concern.

Maintenance Cost.

Global competition.



SWOT Analysis

Strength



Strength

Your specialist marketing expertise.

A new, innovative product or service.

Location of your business. Quality processes and procedures.

Any other aspect of your business that

adds value to your product or service.

Weakness



Weakness

Lack of marketing expertise.

Undifferentiated products or services.

Location of your business. Poor quality goods or services.

Damaged reputation.

Opportunity



Opportunity

A developing market such as theInternet.

Mergers, joint ventures or strategicalliances.

Moving into new market segments thatoffer improved profits.

A new international market. A market vacated by an ineffective

competitor

Threat



Threat

A new competitor in your home market.

Price wars with competitors.

A competitor has a new, innovativeproduct or service.

Competitors have superior access tochannels of distribution.

Taxation is introduced on your productor service.

Hidden Benefits



Hidden Benefits

Tax Breaks.

Low Start up Costs.

Low Operating Costs.

High Profit Margin.

Market for little or no money.

You do not need your own Product.

Time Freedom.

Open 24 Hours in every country.



4Ps of Internet Marketing

Product



Product

Make sure that your product is somethingthat is useful to your intended customers.

Make sure that the product does what it says.

Ensure Quality. Packaging.

Brand Consistency.

Good After Sales Service.

Price



Price

Competitive Pricing.

Customers willingness to pay.

Experimentation with price.

Place



Place

Placement on Major Search Engines.

Placement of vertical search engines/

guides and local search. Placement through affiliates.

Promotion



Promotion

Promotion through display advertising.

Promotion though search marketing.

Promotion through socal media. Promotion through Public Relations.



Strategies of E -Marketing

7 Dimensions to Consider



7 Dimensions to Consider

Personalization.

Privacy.

Customer Service. Community.

Site.

Security.

Sales Promotion.



Classification of E-Marketing

Methods of Internet Marketing



g

Search engine marketing.

Display Marketing

E-mail Marketing, Affiliate Marketing

Interactive Marketing

Blog Marketing.

Viral Marketing



Segmentation and Targeting

Segmentation



g

Geographic

Demographic (Age, Income, Gender,

Education, Ethnicity) Psycographic (Activities, Interests,

Opinions, Personality, Values.)

Behaviour (Benefits sort, Usage level,Brand Loyalty, User Status.)

Behavioral Segmentation



g

Simplifiers

Surfers

Connectors Bargainers

Routiners

Targetting



g g

Four different approaches

1) Mass Marketing.

2) Multi segment Marketing.3) Niche Marketing.

4) Micro Marketing.



Differentiation and Positioning

Strategies

Differentiation



Product.

Service.

Personnel. Channel.

Image.

Positioning



g

Technology.

Benefit.

User Category. Competitor.

Integrator.

marketing for managers

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