Marketing –

Introduction and
Concepts
‘Marketing is the management process
that identifies, anticipates and
satisfies customer requirements
profitably’

The Chartered Institute of Marketing

‘The right product, in the right place,
at the right time, and at the right
price’
‘Marketing is a social and managerial
process by which individuals and
groups obtain what they want and
need through creating, offering and
exchanging products of value with
others’
Kotler 1991
A better definition of marketing:

Marketing is War!
• The true nature of marketing today
involves the conflict between
corporations.
• Not the satisfying of human needs
and wants!
 What leads to defeat in both
War and Marketing?

• Over-pessimism (Fear of Failure)

• Over-optimism (Failure to Fear
Failure)
 Implications of marketing
• Who are our existing / potential customers?
• What are their current / future needs?
• How can we satisfy these needs?
• Can we offer a product/ service that the customer
would value?
• Can we communicate with our customers?
• Can we deliver a competitive product orservice?
• Why should customers buy from us?

Marketing
 Is this enough?
• Is knowing what the customer wants
enough when all of your competitors
know it as well?
• Or is success based primarily on
strategies and tactics?
 Most Common Marketing
Errors
• Failure to keep products/services up-to-date
• Failure to estimate market potential accurately
• Failure to gauge the trend of the market
• Failure to appreciate regional differences in
market potential and in trend of market
• Failure to appreciate seasonal differences in
your customers’ demand
 Most Common Marketing
Errors
• Failure to establish the advertising budget
based on the job to be done
• Failure to adhere to policies established in
connection with long-range goals
• Failure to test-market new ideas
• Failure to differentiate between long-term
strategies and short-term tactics
• Failure to admit defeat
 Most Common Marketing
Errors
• Failure to try new ideas while a brand is
climbing
• Failure to integrate all phases of the
marketing operation into the over-all program
• Failure to appraise objectively your
competitors’ brands
• Failure to get the facts and interpret them
correctly
Good Marketing professionals need to
understand the nature, causes,and
cures of marketing failures
 WE'RE NOT DELTA - BUT
WE'RE TRYING TO FLY!
"We want to be like Delta!" proclaimed Anatoly Brylov, Chief
Executive of the Russian airline Aeroflot in an interview with
Time Magazine. That's quite an easy thing to say, but poses
such an enormous challenge for an airline that has been
struggling to come to terms with marketing. Delta has grown
steadily from its 1920s origins as a southern crop spraying
company to be the USA's number 3 airline. By all accounts, it
is popular with its customers and it has to be, for most of its
routes are operated in competition with other airlines. Aeroflot
by contrast has been associated with everything that is
anathema to the management of Delta. During the Soviet era,
travel on Aeroflot had been so dire that the airline -
disparagingly referred to as "Aeroflop", was frequently
described as "the world's worst airline".
 WE'RE NOT DELTA - BUT
WE'RE TRYING TO FLY!
The contrast between Delta and Aeroflot can be explained in terms of the
extent to which the two airlines have adopted a marketing orientation. Delta
has had to fully embrace the principles and practices of marketing because if it
didn't, competitors who did would soon win over customers. Aeroflot on the
other hand traditionally had little need for marketing. It operated in a centrally
planned economy where consumer sovereignty had little meaning. If a
passenger wanted to fly somewhere, they usually had no choice but to fly with
Aeroflot. Aeroflot's managers were not really concerned with attracting more
passengers or making life better for their existing passengers - they saw
themselves just like any other government bureaucrat who was charged with
implementing a centrally planned economic program. So long as they met very
loosely defined targets, they were OK. The targets themselves weren't
marketing targets at all but operational targets referring to the number of
flights operated or the fuel consumption of aircraft. There was little concern for
whether the flights were going to the right places at the right times, or with
the right level of facilities before, during and after the flight.
 WE'RE NOT DELTA - BUT
WE'RE TRYING TO FLY!
In a communist centrally planned economy, it was not surprising to find
Aeroflot adopting a production orientation to its business. Operational
considerations came first, customers came second. Stories abounded
about what this actually meant for passengers. Planes were known to
leave late because members of the crew were drunk, baggage was
routinely stolen by ground staff and ticketing and reservations system
were corrupt and inefficient. It was commonplace for passengers to
bribe flight attendants to be allowed on an aircraft, even though all
seats were full. As for in-flight services, there weren't any, unless warm
water in plastic cups is counted.
The break up of the former Soviet Union and the rapid disintegration of the
centrally planned economy propelled Aeroflot into a new era in which
marketing took on significance for the first time. The spur to marketing
was the withdrawal of the heavy subsidies that the airline received from
the government - the airline now had to earn all of its income from fares
paid by passengers. And those passengers were able to exercise
increasing choice as the domestic civil aviation market was opened to
competition for the first time.
 WE'RE NOT DELTA - BUT
WE'RE TRYING TO FLY!
The first thing the new management did was to repaint its fleet of
aircraft with a new name - Aeroflot Russian International Airlines.
That was a skin-deep change - to achieve a true marketing
orientation, the airline had to embark on much more
fundamental change. Part of that fundamental change was to
impress upon staff that passengers were important people whose
needs had to be satisfied, rather than being brushed aside as
nuisances. Staff had to be made aware that over 70 new regional
airlines had appeared on the scene, many of them competing
with Aeroflot for passengers' business. Many of these - such as
Uzbekistan Air - had acquired modern western aircraft and put its
crews through a customer care programme which even Delta
might have approved of. The management structure also had to
change from an authoritarian structure to one which was able to
integrate operational and marketing functions, in order to allow
new opportunities to be profitably exploited.
 WE'RE NOT DELTA - BUT
WE'RE TRYING TO FLY!
• Despite the enormity of the airline's task, changes were put in
hand. The aircraft fleet has being modernized, including the lease of
a number of European Airbuses. This has gone some way to allay
potential customers' fears over the safety record of Aeroflot's
primitive Tupolev and Illuyshin aircraft, many of which have been
scrapped. Locally prepared in-flight meals have been replaced with
western made products. Flight attendants have been attending
politeness seminars, often run in conjunction with western
consultants. A number of key executives have been enrolled on
western run marketing and management courses. Fares are now
determined with due regard to market considerations, rather than
being set according to a central plan. Marketing research is now
taken very seriously to monitor customers' reactions to the airlines
service levels. In short, "passengers" have become "customers"
whose business can no longer be taken for granted.
 WE'RE NOT DELTA - BUT
WE'RE TRYING TO FLY!
Is Delta worried by the regeneration of Aeroflot? At the
moment, the two airlines compete only indirectly, but over
the longer term, Aeroflot has expressed its desire to become
a global airline. It signed an agreement with British Airways
which will help it to expand beyond its Russian base. Global
success would have seemed preposterous to an observer of
Delta back in 1924. But by putting customers first and
adopting the principles and practices of marketing, Delta has
achieved its current enviable position. With the same attitude
and determination, Aeroflot could just do the same.
 MARKETING VS SELLING
Example: M. Institute is an institute
specializing in preparing students for CAT.
It opened a branch at Bhopal in June 2002.
To open the branch, it recruited the following
persons: Branch Manager (BM), Marketing
Executive(ME), Student Counselor (SC),
Operations Executive (OE) and an office boy.
Faculty was not recruited initially.
BM, ME and SC were responsible for selling. OE was
responsible for administration of branch including
housekeeping and accounting. Due to the efforts of selling
team and an aggressive advertising campaign, more than
twenty enrolments were done in various courses within the
first two months. Faculty recruitment was done in a hasty
manner within a week of first enrolments. Students of first
batch complained of poor course material, inadequately
prepared faculty, and absenteeism of faculty. In the months
from November 2002 to January 2003, there have been no
fresh enrolments. By the end of January 2003, M. Institute
had sacked its complete original selling team and had
advertised for fresh executives who could give
commitments about meeting targets of enrolments.
 Task for Today
Newspapers have been facing declining sales
all over the world due to onslaught of
television in the past two decades. However,
some newspapers have suffered more than
others. A rare few have managed to grow in
spite of
difficult times. The picture seems confusing. If
you have to start a new newspaper in your
town, what will be the key factors that you
will devote your attention to?