SATHYABAMA UNIVERSITY

FACULTY OF BUSINESS ADMINISTRATION

SUBJECT TITLE: Engineering economics and marketing management SUBJECT CODE: SBAX1002

Course: B.Tech(chemical) Year: IV Semester: VIII

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UNIT V

Marketing
Marketing is a social process by which individual and groups obtain what they need and
want through creating and exchanging products and value with other.

This definition includes following core concepts:-

1. Needs, wants and demands

2. Products, value and satisfaction
3. Exchange and transaction, markets and marketers.

Needs, wants and Demands

1. Need - A state of felt deprivation of some basic satisfaction (food, clothing, shelter)
2. Wants- Wants are desires for specific satisfiers of the deeper needs. Needs are few
and wants are many.
3. Demands- Are wants backed by ability to buy and willingness to buy.

Products, Offers, Satisfiers, Resources:

Anything that can be offered to someone to satisfy a need or want is a product.

Product refers to physical object
Services refer to intangible object

Value and Satisfaction

Value is the customer estimate of the products capacity to satisfy a set of goals
Value is the ratio between what the customer gets and what he gives
Customer gets benefits and assume costs

Exchange and Transaction

 Exchange is the act of obtaining a desired product by offering something inreturn.
Exchange takes place when (5) conditions are satisfied
Two parties should be there
Each party must have something of value to the other
Each party is capable of communication and delivery
Each party is free to accept or reject the offer
Each party believes that it is appropriate to deal with the other party
Exchange is a process rather than event. It is a value creating process because it
normally leaves both parties betteroff.
Transaction is a trade of values between two or more parties.

What is market?

A market consist of all the potential customers sharing a particular need or want who might
be willing and able to engage in exchange to satisfy that need or want.

What is marketing?

Marketing is the management process which identifies, anticipates and supplies customer
requirements efficiently and profitably.

In other words, it is the process of understanding, creating and delivering profitable value
to targeted customers better than the competition.

Marketing mix

A mixture of several ideas and plans followed by a marketing representation to promote a

particular product or brand is called marketing mix.

Elements of marketing mix

1. Product:- goods manufactured by organizations for the end user called products.
Products can be of two types tangible and intangible products. An individual can see,
touch and feel tangible product as compared to intangible products. A product in a
market place is something which seller sells to the buyers in exchange of money.
2. Price:- the money which a buyer pays for a product is called as price of the product.
The price of a product is indirectly proportional to its availability in the market.
Retail stores which stock unique products (not available at any other store) quote a
higher price from the buyer.
3. Place:- place refers to the location where the products are available and can be sold or
purchased. In a market, buyers and sellers can physically meet and ineract with each
other whereas in a virtual market buyers and sellers meet through internet.
 4. Promotion:-promotion refers to the various strategies and idea implanted by the
marketers to make the end use aware of their brand. Promotion includes various
techniques employed to promote and make a brand popular amongst the masses.
Promotion is replaced by communication, it can includes advertising, public realtions,
personal selling and any form of communication between the firm and the consumers.

Marketing management.

Marketing management is the analysis, planning, implementation and control of programs

designed to create, build and maintain beneficial exchanges and relationship with target
markets for the purpose of achieving organisational objectives.

Marketing management as the art and science of choosing target market and getting,
delivering and communicating superior customer value.

Marketing management tools

1. Developing marketing strategies and plans.

2. Capturing marketing in sight
3. Connecting with customers
4. Building strong brands
5. Shaping the market offering
6. Delivering value
7. Communicating value
8. Creating long term growth

Marketing concepts

There are five competing concepts under which organisations conducts their marketing
activities.

1. Production concept
2. Product concept
3. Selling concept
4. Marketing concept
5. Societal marketing concept

Advertising
The word advertising is derived from the latin word adverto. Ad means towards and verto
means inturnleterally, it is meant to turn peoples attention to a specific thing.

Definition of Advertising

Advertising is any paid form of non personal presentation and promotion of ideas, goods or
services by an identified sponsor - American marketing association
Advertising is mass communication of information, intended to persuade buyers as to
maximize profits - littlefield

Steps in advertising process:-

Advertising include various types of institution such as business firms, museums, amusement
parks, hotels, hospitals, chantable organisation, government agencies, tec., advertisement
disseminate message to target audience.

The advertising department proposes a budget, develops advertising strategy, approves

adverisements and compaigns hard, handles (i) direct mail advertising (ii) dealer displays and
(iii) other forms of advertising. The five Ms are decided in developing an advertisement
programme: mission, money, message, media and measurement.

These decision are explained:-

1. Setting the advertising objective

2. Deciding on the advertising budget
3. Choosing the advertising message
4. Deciding on media
5. Evaluating advertising effectiveness.

Features of Advertisement

1. Advertisement is a mass non personal communication

2. Advertisement benefits the buyers
3. Advertisement persuades buyers to buy the goods advertised
4. Ultimately advertisement maximises the profits
5. Advertisement is a paid form of publication
6. Advertisement is identified with a sponsor

Advertisement and Sales promotion

Sales promotion:- includes those marketing activities other than personal selling,
advertising and publicity. They stimulate consumer purchasing and dealer effectiveness
such as displays, should and expositions, demonstration and various non recurring selling
efforts.

S.NO ADVERTISEMENT SALES PROMOTION

1. Advertising is presentation of Sales promotion is rather a king of
information about the product by an inducement. It develops a favourable
identified sponsor. purchase decision
2. It is recurring It is non recurring
3. It has a long term effect, creating a It is of short term nature
good image of company.
4. Many and varied media carry in Media include premiums, prizes,
advertisement message ( press, audio, sampling, consumer contents, trading
visual, television, etc) stamps etc.
5. Advertisement acts in pre and post Sales promotion plays its role in the
transaction phase. transaction phase.

Advertising objectives

The primary objectives of advertisement is to increase sales. It has become the lifeline of
modern business. Personal selling and other forms of promotion are support by
advertising

1. Increase sales volume thereby reducing unit production sales

2. Stabilies a firms business
3. Increases the percentage of net profit
4. Secures leadership or domination
5. Establishes the character of the management in the public mind as reputation
6. Sells the institution as well as the product or services
7. Sets a standard for organisation performance
8. Protects a company from competition
9. Establishes standards of value for the product
10. Create new uses of the product.

Types of Advertising.

1. Product Advertising
2. Institutional Advertising
3. Other types.
(a) Product advertising:- product advertising attempts to inform and stimulate the market
about the advertisers promoters specific branded products in such a manner as to
make the brands seem more desirable
Product advertising may be sub divided into following:-
1. Direct action and indirect action advertising
2. Pioneer demand and selective demand advertising.
(b) Institutional advertising:- institutional advertising creates a favourable image of the
company which market the product or services. Service organisation such as life
insurance, corporation of India, state bank of India, Indian bank focus on creating a
good image among the public.
(c) Other types:-
The other types of advertising are as follows
 When an advertising is sponsored by manufacturer, is known as national
advertisement, when a advertising, retailer undertakes an advertisement
campaign it is called local advertisement
Consumer advertising is aims at altimate consumers who buy goods and
services for personal use.
Emotional advertisng appeals to emotional motives of buyers. For example,
advertisement for premium brands life pears, dove etc.
Whereas cinthol and life boy appeal to rational motives of buyers by eg.
Planning about the medicinal qualities of these soups.

Criticism of Advertising

Advertising has been criticised on many grounds A. longman has levelled the following
charges against advertisement:-

1. Advertisement sells people thing they neither need or want

2. Advertisement creates proliferation of variety in goods
3. Advertising increases the prices of pdt/services
4. Advertising is deceptive and misleading
5. Most advertising are not relevant to situations
6. Advertising stimulates bad taste
7. Advertisement has a shortlife
8. Advertisement is intrusive

Sales promotion:-
Definition:

Those activities that supplement both personal selling and advertising, co ordinate them and
help to make them more effective

Sales promotion consists of short term incentive to encourage purchase or sales of a product
or services

Objectives of sales promotion:

1. Bridge between advertising and personal selling

2. Introduction of new products
3. Attracting new customers
4. Inducing present customers to buy
5. Improving the public image of the firm

Types of sales promotion

1. consumer sales promotion:- sales promotion aimed at consumers is called consumer

sales promotion. It aims at stimulating consumer. The main consumer promotion
 sales tool include samples, coupons, demonstration, contests, cast retinal offer,
premium etc.
2. dealers sales promotion:- dealers sales promotion a trade promotion is employed
when products are sold through the retailers or whole salers. Dealers sales promotion
tools include buying allowance, merchandise allowance, price deals, premium,
cooperative advertising, sales contest, point of purchases etc.,
3. sales force promotion:- sales force promotion aims at the sales force. It stimulates
them to work hard. The tools for sales force promotion include bonus to sales force,
sales force contests, salesmans meet and conferences.

Channels of distribution
A set of inter dependent organisations included in the process of making a product or
services available for use or consumption by the consumer or business user - philpkotler

A channel of distribution or marketing channel is the structure of intra company organisation

units and extra company agents and dealers, wholesale and retail through which a
commodity, product or service is marketed. - American marketing of association

Features of marketing channels

every marketing channel consist of one or more of the transfer points

the transfer of the tittle may be direct or indirect. It is direct when the producer sells
the product outright to a wholesaler or retailer.
A channel always includes both the producer and the final consumer for the product
as well as agents, middlemen, involved in the transfer of title
The channel does not include firms such as rail, roads, banks, other institutions which
render services.
A channel of distribution is a structive it is organised and represents a choice among
alternative.

Types of channel of distribution

1. Channel of distribution for consumer goods:-

(a) Zero level channel
(b) One level channel
(c) Two level channel
(d) Three level channel
2. Channel of distribution for industrial goods
3. Producers users
4. Distribution channel for services.

Middlemen
A middlemen participants in marketing channel at points at between the producers and final
buyers

The American Marketing Association defines middle man in the following words

A middleman is one who specialises in performing operations or rendering services that are
directly involved in the purchase and sale of goods in the process of their flow from
producers to final buyers.

Classification of middleman

1. Merchant middleman
(a) Wholesalers:- all the activity in selling goods or services to those who buy for
resale or business use - philpkotler

Characteristics of wholesalers:-

Wholesaler operate between the manufacture and resellers

Wholesalers gives advice to the manufacturers and reatailer
Wholesaler sells in large volume
Wholesaler doesnot sell to the ultimate consumer final user
As a merchant middleman, wholesaler takes tittle to the goods he handles
(b) Retailers:-
The word retailers is derived from a word retailer. It means to cut again. Retail
trade cuts if similar protions from large volume goods. Retailing consists of the
activities involved in selling directly to the ultimate consumer for personal, non
personal user

Definition:-
Retailing includes all the activities involved in selling goods or services directly to
final consumers for their personal, non business
Types of retailers
1. Itinerant retailers
2. Fixed shop retailers
3. Small shop retailers
4. Large shop retailers

FRANCHISING:-

Franchise means privilege. A franchise is a conditional right given to a reatailer

to market the company product and services under the banner of the franchiser.

a franchising operation is a legal contractual relationship between a franchiser (

the company offering the franchise) and the franchisee ( the individual who will
own the business)
IMPORTANT QUESTIONS
PART A
1.Write anote on industrial marketing
2.Mention any four types of sales promotion tools
3.What is meant by franchising?
4.What are all the major functionsof retailer?
5.Define advertisement
6.What do you meanby advertisement?
7.Explain any two concepts in marketing
8.Who are middleman? Give examples
9. What are all the major functionsof wholesaler?
10.Define consumer
PART B
1..Describe varies forecasting techniques used in marketing
2.What is franchising?Explain the varies methods of franchising?
3.Discuss the different channels of distribution in marketing
4.What are the varies sales promotion techniques?
5.Define industrial marketing.Distinguish between industrial marketing and consumer
marketing
6.Define advertising.What are the different media for advertising?What are the varies
promotional techniques now?