ASHABIKASH MOHAPATRA

MODULE 1

The AMERICAN MARKETING ASSOCIATION defines marketing as the performance of

business activities that direct the flow of goods and services from producer to
consumer or user.

Marketing is-

• -result of careful planning and execution

• -it is tricky

Marketing is an organizational function and a set of process for creating,

communicating and delivering value to customers and for managing customer
relationship in ways that benefit the organization and the stakeholders.

Marketing practitioners and some marketing academicians perceive the entire

scope of marketing to be profit oriented.

Marketing is the,

1. -analyzing

2. -organizing

3. -planning

4. -controlling of the firms.

Marketing is used to,

• -create the customer

• -keep the customer

• -satisfy the customer

The focus of these activities can be concluded that marketing is one of the premier
components of business management. I.e. operations, human
resources,accounting,law and legal aspects and others.

Marketing is a societal process by which the individuals and the groups obtain what
they need and want through creating offering and freely exchanging products and
services of value with others.

What is marketed?

 -goods (car, television)

  -services (hotels, barbers)

 -events (trade shows)

 -experiences (restaurant creating ambience of Orissa)

 -persons (CEO’S, artists)

 -places (states, regions)

 -properties (real estate)

 -Organizations (TESCO)

 -information (books, schools)

 -ideas (kya idea sir’ji)

Who markets?

• Marketers and prospects

Marketers stimulate demand for their company’s product. Eight demand

states are possible

Negative demand

• Nonexistent demand

• Latent demand

• Declining demand

• Irregular demand

• Full demand

• Overfull demand

• Unwholesome demand

 Markets

It’s a physical place where buyers and sellers gathered to buy and sell goods.
 (TYPES OF MARKET)

CONCEPT OF MARKETING:

• EXCHANGE CONCEPT

• PRODUCTION CONCEPT

• PRODUCT CONCEPT

• SALES CONCEPT

Here under these concepts, it is to see that how other face up with a problem and
organization catching up with marketing concept are better enabled to win
customer and succeed.

Work of a marketer

Marketing is a never ending process it is not only performed by a particular person

or department it needs to take into consideration all the relevant factors, from
package design to logistic methods. Marketing must be involved in general
management activities.

Changing new marketing environment has put considerable demands on the

marketing executives. Marketers must have diverse quantitative and qualitative
skills.

Marketers should try to,

 Strengthen the brands

 Measure market effectiveness

 Drive new product development based on customer needs

 Gather meaningful customer insights

  Utilizing new marketing technology

Marketing concept:

Emerged -1950’s

Motto-customer centered

Previously-product centered

Now in marketing concept the job is to find right product for right customers but not
to find right customer for your product.

Marketing concept got its birth that out of the awareness that an organization
should always be focused on consumer wants and end up with satisfaction of those
wants. This concept puts the customer at both the beginning and end of the
business cycle. Here everything is seen from the customer prospect.

SELLING VS MARKETING

MARKETING SELLING

1. It starts with the buyer & 1. It starts with the seller and
focuses constantly on the focuses on seller and its need
needs of buyer.
2. seller is the center of the
2. Buyer is the centre of the business universe
business universe.

3. Emphasis on identification of a
market opportunity. 3. emphasizes on saleable surplus
available with the corporation

4. seeks to convert product into

4. Seeks to convert customer cash
needs into products

5. Views business as a customer

satisfying process 5. views business as a goods
producing process
6. Buyer determines the shape the
marketing mix should take 6. sellers preference dominates
the formulation of the
7. Emphasize on innovation in marketing mix
every sphere on providing
better value to the customer by 7. emphasize on staying with the
adopting better technology existing technology and
 8. Consumer determines price reducing cost

9. Emphasis is on integrated
marketing
8. cost determines the price

9. emphasis is on somehow selling

10. Firms practicing there is no coordination
marketing thinks that between departments
marketing is the central
function of the business the 10. firms practicing selling
entire organization is organized thinks that production is the
around the marketing function central function of the
organization
11. Marketing views customer
as the very purpose of the
business ,sees the business 11. selling views the
from the point of the view of customer as the last link in the
the customer, customer business
consciousness is the main
motto

MARKETING PROCESS

Under the marketing concept, the firm must find a way to discover unfulfilled customer needs
and bring to market products that satisfy those needs. The process of doing so can be modeled in
a sequence of steps: the situation is analyzed to identify opportunities, the strategy is formulated
for a value proposition, tactical decisions are made, the plan is implemented and the results are
monitored.

The Marketing Process

Situation Analysis

|
V

Marketing Strategy
 |
V

Marketing Mix
Decisions

|
V

Implementation &
Control

I. Situation Analysis

A thorough analysis of the situation in which the firm finds it serves as the basis for identifying
opportunities to satisfy unfulfilled customer needs. In addition to identifying the customer needs,
the firm must understand its own capabilities and the environment in which it is operating.

The situation analysis thus can be viewed in terms an analysis of the external environment and
an internal analysis of the firm itself. The external environment can be described in terms of
macro-environmental factors that broadly affect many firms, and micro-environmental factors
closely related to the specific situation of the firm.

The situation analysis should include past, present, and future aspects. It should include a history
outlining how the situation evolved to its present state, and an analysis of trends in order to
forecast where it is going. Good forecasting can reduce the chance of spending a year bringing a
product to market only to find that the need no longer exists.

If the situation analysis reveals gaps between what consumers want and what currently is offered
to them, then there may be opportunities to introduce products to better satisfy those consumers.
Hence, the situation analysis should yield a summary of problems and opportunities. From this
summary, the firm can match its own capabilities with the opportunities in order to satisfy
customer needs better than the competition.

There are several frameworks that can be used to add structure to the situation analysis:

• 5 C Analysis - company, customers, competitors, collaborators, climate. Company

represents the internal situation; the other four cover aspects of the external situation
• PEST analysis - for macro-environmental political, economic, societal, and technological
factors. A PEST analysis can be used as the "climate" portion of the 5 C framework.
• SWOT analysis - strengths, weaknesses, opportunities, and threats - for the internal and
external situation. A SWOT analysis can be used to condense the situation analysis into a
 listing of the most relevant problems and opportunities and to assess how well the firm is
equipped to deal with them.

II. Marketing Strategy

Once the best opportunity to satisfy unfulfilled customer needs is identified, a strategic plan for
pursuing the opportunity can be developed. Market research will provide specific market
information that will permit the firm to select the target market segment and optimally position
the offering within that segment. The result is a value proposition to the target market. The
marketing strategy then involves:

• Segmentation
• Targeting (target market selection)
• Positioning the product within the target market
• Value proposition to the target market

III. Marketing Mix Decisions

Detailed tactical decisions then are made for the controllable parameters of the marketing mix.
The action items include:

• Product development - specifying, designing, and producing the first units of

the product.
• Pricing decisions
• Distribution contracts
• Promotional campaign development

IV. Implementation and Control

At this point in the process, the marketing plan has been developed and the product has been
launched. Given that few environments are static, the results of the marketing effort should be
monitored closely. As the market changes, the marketing mix can be adjusted to accommodate
the changes. Often, small changes in consumer wants can addressed by changing the advertising
message. As the changes become more significant, a product redesign or an entirely new product
may be needed. The marketing process does not end with implementation - continual monitoring
and adaptation is needed to fulfill customer needs consistently over the long-term.

Marketing function

During the first half of this century, the administrators and managers were purely production oriented and
the field of functions of marketing was completely neglected. As the saying goes troubles and difficulties
are no mans concern, they slowly began to understand identify and analyze the importance of marketing
functions during the fifties when they faced the problems of excess production.
Hence those who have understood the concept of marketing function and practiced accordingly survived
and others were slowly edged out of the field of marketing. Developing countries particularly countries like
India have to concentrate a little more in this field so that they can avoid simultaneously the problems of
scarcity and excess productions

The word marketing was a recent addition to the industrial vocabulary. At initial stages of its development
it just referred to buying and selling activities at market place. As the days pass on after the world war two
the very concept was adapted to include very many factors and functions come under its meaning. During
the forties and fifties of this century managers and administrators were purely production oriented and the
field and functions of marketing was in no mans thinking.

But when they faced the problems of excess production during the fifties they slowly began to
understand, identify and analyze the term marketing and its functions. So those who have understood the
concept very well and practiced accordingly survived and others were slowly being eased out of the field.
All the more the developing countries like India to concentrate a bit more in this field so that they can
avoid problems of scarcity and excess production simultaneously.

After the production the goods have to pass through multi-various activities, before it reaches the ultimate
consumer. Some of the activities are general and others are special.

More than the distribution of the goods, products and services, marketing in its ambit includes the
analysis of the feedback information’s form the consumers and users. This feedback information is used
to after the existing decisions and policies. So that the organizational goals can say that marketing start
and ends with the consumer. By condensing the above said information we can define marketing
function. As an act operation or service which the original product and the ultimate consumer are linked
together.

Marketing is involved in all activities of economic nature. From the economics point of view it creates
time, place, and possession utilities s.. Even though most of the functions are performed by the so called
and intermediaries, this does not reduce or lesson the importance of such functions in any way. These
varied functions are grouped under three types of process brief

They are;

(a) Concentration
(b) Equalization and
(c) Dispersion

Concentration

Under this process, goods and products are collected together at a central point to facilitate further action
upon them. It is concerned with gathering, collecting and concern rating raw materials, partly finished
goods and finished products etc at central points. This concentration to a certain extent embraces various
other functions also such as assembling, storage, financing, grading, standardization, risk taking etc..
Equalisation

According to Clark, equalization consists of the adjustment of the supply to the demand on the basis of
the time and quality. This sort of adjustment can be done through storage and transportation in market
centers

Dispersion

It refers to the allotment of the raw materials to the producer and the final products to the consumers in
lots of small and big sizes suitable for their consumption.

Classification of Marketing Functions

There is consensus regarding the functional area of marketing. It varies from 5 to 36 and Rayan has even
identified 120 different kinds of marketing functions in the marketing journey of the products and articles.

(A) If we accept the marketing concept as stated in previous lesson we must agree to the simple
proposition that supply in the functions of demand and therefore subservient to it, here demand is the
limiting and key factor. So a better understanding of the demand will make clear about the various
functions of marketing. Bates and Parkinson divide it into four aspects. They are

1. Analysis and forecasting i.e., marketing research

2. Product development and design
3. Influencing the demand design, advertising etc
4. Service distribution after sales, service etc.

The success in marketing of a firm depends upon the co-ordination of these ingredients in such a way as
to create a suitable mix to the particular situation in hand.

Eight Universal Marketing Processes

1. Environmental and scanning analysis

2. Market research and analysis

3. Segmentation, targeting and positioning

4. Product development and differentiation

5. Valuation and pricing

6. Channel and value-chain management

7. Integrated marketing communications (IMC)

8. Relationship-building

The marketing environment surrounds and impacts upon the organization. There are three key
perspectives on the marketing environment, namely the 'macro-environment,' the 'micro-
environment' and the 'internal environment'.

The micro-environment

This environment influences the organization directly. It includes suppliers that deal directly or
indirectly, consumers and customers, and other local stakeholders. Micro tends to suggest small,
but this can be misleading. In this context, micro describes the relationship between firms and
the driving forces that control this relationship. It is a more local relationship, and the firm may
exercise a degree of influence.

The macro-environment

This includes all factors that can influence and organization, but that are out of their direct
control. A company does not generally influence any laws (although it is accepted that they
could lobby or be part of a trade organization). It is continuously changing, and the company
needs to be flexible to adapt. There may be aggressive competition and rivalry in a market.
Globalization means that there is always the threat of substitute products and new entrants. The
wider environment is also ever changing, and the marketer needs to compensate for changes in
culture, politics, economics and technology.
The internal environment.

All factors that are internal to the organization are known as the 'internal environment'. They are
generally audited by applying the 'Five Ms' which are Men, Money, Machinery, Materials and
Markets. The internal environment is as important for managing change as the external. As
marketers we call the process of managing internal change 'internal marketing.'

Essentially we use marketing approaches to aid communication and change management. The
external environment can be audited in more detail using other approaches such
National & Global Marketing

Global marketing is not a revolutionary shift, it is an evolutionary process. While the following
does not apply to all companies, it does apply to most companies that begin as domestic-only
companies.

Domestic marketing

A marketing restricted to the political boundaries of a country, is called "Domestic Marketing".

A company marketing only within its national boundaries only has to consider domestic
competition. Even if that competition includes companies from foreign markets, it still only has
to focus on the competition that exists in its home market. Products and services are developed
for customers in the home market without thought of how the product or service could be used in
other markets. All marketing decisions are made at headquarters.

The biggest obstacle these marketers face is being blindsided by emerging global marketers.
Because domestic marketers do not generally focus on the changes in the global marketplace,
they may not be aware of a potential competitor who is a market leader on three continents until
they simultaneously open 20 stores in the Northeastern U.S. These marketers can be considered
ethnocentric as they are most concerned with how they are perceived in their home
country.Export marketing

Generally, companies began exporting, reluctantly, to the occasional foreign customer who
sought them out. At the beginning of this stage, filling these orders was considered a burden, not
an opportunity.
International marketing

If the exporting departments are becoming successful but the costs of doing business from
headquarters plus time differences, language barriers, and cultural ignorance are hindering the
company’s competitiveness in the foreign market, then offices could be built in the foreign
countries. Sometimes companies buy firms in the foreign countries to take advantage of
relationships, storefronts, factories, and personnel already in place. These offices still report to
headquarters in the home market but most of the marketing mix decisions are made in the
individual countries since that staff is the most knowledgeable about the target markets. Local
product development is based on the needs of local customers. These marketers are considered
polycentric because they acknowledge that each market/country has different needs.

Multinational marketing

At the multi-national stage, the company is marketing its products and services in many
countries around the world and wants to benefit from economies of scale. Consolidation of
research, development, production, and marketing on a regional level is the next step. An
example of a region is Western Europe with the US. But, at the multi-national stage,
consolidation, and thus product planning, does not take place across regions; a regiocentric
approach. It should be noted that most companies that self describe their organization as
multinational really are not entirely multinational. In fact, the definition of the multinational
corporation itself is somewhat suspect. Simply calling a company a multinational corporation is
not enough. A company must make adjustments to the ways it perceives its role in the
international market place so that it might reap the rewards the multinational environment.
Essentially there are three responses or behaviors that the multinational corporation can use in
the international market place. These three orientations that a multinational corporation has been
described as ethnocentric, polycentric, and geocentric. In ethnocentric company the culture of
the home country pervades the organization. In the polycentric organization the host country
begins to play more of a role but the company still treats each individual country unit as a some
what disparate group with only a very small information flow back to headquarters. In the most
mature stage of multinational development, geocentric, the company has truly started to act
globally. The company can now begin to reap the benefits of the multinational economy. The
somewhat parasitic nature of the previous types of multinational system are now replaced with
the give and take of international relationships that involve the all important two way
communications flow.

Global marketing

When a company becomes a global marketer, it views the world as one market and creates
products that will only require weeks to fit into any regional marketplace. Marketing decisions
are made by consulting with marketers in all the countries that will be affected. The goal is to
sell the same thing the same way everywhere
 Technology

Nothing else evolves as fast as technology. Tomorrow's managers need to understand the
importance of innovation and diffusion of technology in an intensely competitive business
environment and to be aware of the various strategies available to reap the benefit of innovation.
Beyond the basics you will be exposed to innovative capabilities, implementing development
strategies which take into account technological changes, and the integration of technology and
strategy. The universal and fundamental importance of adopting appropriate scientific and
technological applications in promoting sustainable socio- economic development represents an
essential component of development planning policy

Government Policy

The general principle is that it is crucial for the government to provide a

stable macroeconomic environment conducive to business development with
a clear, transparent and neutral regulatory environment and neutral
incentives to all firms and industries. Clear, transparent and neutral
incentives (those which do not distinguish by sector or firm) are crucial so
that entrepreneurial innovation is rewarded more highly than rent-seeking
activities. The economy must provide its most talented members with the
incentive to engage in entrepreneurial activities such as starting or
expanding firms, developing new products and lowering costs. If the
economy provides extensive subsidies or tax exemptions to industries or
firms, or presents a difficult regulatory framework within which to do
business, corruption will be encouraged and, crucially, talented people will
find it more profitable to engage in the socially wasteful activity of lobbying
the government for subsidies, protection, tax or regulatory relief

Buyer Power

The power of buyers is the impact that customers have on a producing industry. In
general, when buyer power is strong, the relationship to the producing industry is near
to what an economist terms a monopsony - a market in which there are many
suppliers and one buyer. Under such market conditions, the buyer sets the price. In
reality few pure monopsonies exist, but frequently there is some asymmetry between a
producing industry and buyers. The following tables outline some factors that determine
buyer power.

Buyers are Powerful if: Example

Buyers are concentrated - there are a few buyers with
significant market share
Buyers purchase a significant proportion of output -
distribution of purchases or if the product is standardized
DOD purchases from defense contractors
Circuit City and Sears' large retail market provides power
over appliance manufacturers
Buyers possess a credible backward integration threat -
Large auto manufacturers' purchases of tires
can threaten to buy producing firm or rival

Buyers are Weak if: Example

Producers threaten forward integration - producer can take Movie-producing companies have integrated forward to
over own distribution/retailing acquire theaters
Significant buyer switching costs - products not
standardized and buyer cannot easily switch to another IBM's 360 system strategy in the 1960's
product
Buyers are fragmented (many, different) - no buyer has
Most consumer products
any particular influence on product or price
Producers supply critical portions of buyers' input -
Intel's relationship with PC manufacturers
distribution of purchases

Supplier Power

A producing industry requires raw materials - labor, components, and other supplies.
This requirement leads to buyer-supplier relationships between the industry and the
firms that provide it the raw materials used to create products. Suppliers, if powerful,
can exert an influence on the producing industry, such as selling raw materials at a high
price to capture some of the industry's profits. The following tables outline some factors
that determine supplier power.

Suppliers are Powerful if: Example

Credible forward integration threat by suppliers
Suppliers concentrated
Significant cost to switch suppliers
Customers Powerful
Baxter International, manufacturer of hospital supplies,
acquired American Hospital Supply, a distributor
Drug industry's relationship to hospitals
Microsoft's relationship with PC manufacturers
Boycott of grocery stores selling non-union picked grapes

Suppliers are Weak if: Example

Many competitive suppliers - product is standardized Tire industry relationship to automobile manufacturers
Purchase commodity products Grocery store brand label products
Credible backward integration threat by purchasers Timber producers relationship to paper companies
Concentrated purchasers Garment industry relationship to major department stores
Customers Weak Travel agents' relationship to airlines
Consumer resistance considerations

Consumer resistance to marketing is widespread and growing. The combination of

increasing marketing saturation and new technologies of consumer control has led
to an unprecedented level of marketing resistance. Yet, little research has studied
this phenomenon directly. Yankelovich Partners field a MONITOR Omni Plus in
February 2004 to examine this problem and to identify opportunities and new
directions for marketers. This presentation will share the key highlights from this
groundbreaking research as well as the broad outlines of a new marketing model
preferred by consumers

Environmental scanning
Organizations use environmental scanning to monitor important events in their surrounding
Environment. It is a way to answer the question, "What's happening in my environment that will affect
my future?" Scanning involves identifying the issues and trends that have important implications for
the future. The scanning includes analysis of the information about these issues and trends to assess
their importance and determine their implications for planning and strategic decision making

Environmental scanning is usually used at the start of a futures project. It aims at broad
exploration of all major trends, issues, advancements, events and ideas across a wide range of
activities. Information is collected from many different sources, such as newspapers, magazines,
Internet, television, conferences, reports, and also science-fiction books. Various tools and
methodologies are used by large corporations to systematically scope their external environment.
An example is the widely used FUTURE structure developed by Futurist Patrick Dixon
described in his book Future wise - F ast, U rban, T ribal, U niversal, R adical, E thical.
Attention needs to be given to potential Wild Cards - low probability but potentially high impact
events.

Scanning is used to build up a comprehensive picture of factors that could impact strategy.

Four types of indicators can be examined in the process of environmental scanning:

1. Lone signals (individual factors that might indicate change)

2. Landmark events (in various areas of life)
3. Forecasts of experts
4. Statistical descriptions (to portray development of elements of the study).

Self-assessment Tools of environment scanning

1. Self-administered questionnaires.

2. Informal evaluations.

3. Current/Best Practices Research

4. Benchmarking
 5. News Analysis

6. Market Research

• Delphi method

• Extrapolation

• Regression Analysis

Approaches to Environmental Scanning

1. SPIRE Approach

2. SCENARIO BUILDING Approach

Competition Analysis.
Competition is a contest between individuals, groups, nations, animals,
etc. for territory, a niche, or allocation of resources

Economic competition have been classified as

1. direct competition

2. substitute or indirect competition,

3. budget competition

Competition is the most important concept for development .In today’s

world

‘ IT IS A NECESSARY EVIL ‘.

Four different levels of competition.

• Brand competition

• Industry Competition

• Form Competition
 • Generic Competition

Factors contributing to competition

• Cost

• Govt Policies

• Presence of strong brands

• Customer

• Technology

• Lack of credible competition

Competition analysis Tools

As we know competition is very important force which needs to be observed
and analyzed, which is very important in order to know and understand the
competitors.

1.Du Pont Profitability Matrix

2. Competitive Arena Mapping (ARENA is a graphical tool designed to map the

business environment. ARENA provides a concise single picture of the external
actors influencing the organization's value that can be used for decision making.)

3.Segmentation Matrix (Segmentation is essentially the identification of subsets of buyers

within a market who share similar needs and who demonstrate similar buyer behavior. The world
is made up from billions of buyers with their own sets of needs and behavior. Segmentation aims
to match groups of purchasers with the same set of needs and buyer behavior. Such a group is
known as a 'segment'. Think of you r market as an orange, with a series of connected but
distinctive segments, each with their own profile.
 It consists of 5 steps, beginning with the market & environment research. After
fixing the targets and setting the strategies, they will be realized by the marketing
mix in step 4. The last step in the process is the marketing controlling.

Behind the corporate objectives, which in themselves offer the main context for the marketing
plan, will lay the "corporate mission"; which in turn provides the context for these corporate
objectives. In a sales-oriented organization, marketing planning function designs incentive pay
plans to not only motivate and reward frontline staff fairly but also to align marketing activities
with corporate mission.

This "corporate mission" can be thought of as a definition of what the organization

is; of what it does: "Our business is …". This definition should not be too narrow, or
it will constrict the development of the organization; a too rigorous concentration on
the view that "We are in the business of making meat-scales," as IBM was during
the early 1900s, might have limited its subsequent development into other areas.
On the other hand, it should not be too wide or it will become meaningless; "We
want to make a profit" is not too helpful in developing specific plans

Attractiveness of a Market

The following are some examples of aspects that should be considered when evaluating the
attractiveness of a market segment:

• Size of the segment (number of customers and/or number of units)

• Growth rate of the segment
• Competition in the segment
• Brand loyalty of existing customers in the segment
• Attainable market share given promotional budget and competitors' expenditures
• Required market share to break even
• Sales potential for the firm in the segment
• Expected profit margins in the segment

Suitability of Market Segments to the Firm

Market segments also should be evaluated according to how they fit the firm's objectives,
resources, and capabilities. Some aspects of fit include:
 • Whether the firm can offer superior value to the customers in the segment
• The impact of serving the segment on the firm's image
• Access to distribution channels required to serve the segment
• The firm's resources vs. capital investment required to serve the segment

The better the firm's fit to a market segment and the more attractive the market segment, the
greater the profit potential to the firm.

3 Approaches to Marketing Planning

1. The Freestyle Approach (Of the three approaches to planning, this will provide you with the
broadest view of marketing planning as well as the most up-to-date marketing tactics and
programs. It involves researching the marketing plan process by finding material online then
writing a plan based on what you've learned. In fact, the entire marketing plan section of
WebSiteMarketingPlan.com is devoted to those wanting to understand the planning process and
research marketing programs)

2. The "I Need a Structured Starting Place" Approach ( If Freestyle is too time consuming, you
may prefer a bit more structured approach. Purchasing an informational package of marketing
planning tools can help focus your efforts by providing you with a finite process and set of
materials to work with.)

3. The "Take Me Through It Step By Step" Approach (Work step-by-step through the software
and you will have a complete marketing plan document when you reach the final step. Marketing
Plan Pro is the most comprehensive, easy to understand marketing plan software

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