Marketing

in the
Twenty-first Century
Company Orientations Towards the
Marketplace
Consumers prefer products that are
Production Concept widely available and inexpensive

lConsumers favor products that

Product Concept loffer the most quality, performance,

lor innovative features

Consumers will buy products only if

Selling Concept the company aggressively
promotes/sells these products

Focuses on needs/ wants of target

Marketing Concept markets & delivering value
better than competitors
 Customer Delivered Value

Starting
point Focus Means Ends

Existing Selling and Profits through

Factory products promotion sales volume

(a) The selling concept

Customer Integrated Profits through

Market needs marketing customer
satisfaction

(b) The marketing concept

 Selling V/s Marketing
Selling orientations
Focuses on the needs of the seller.
Preoccupied with the sellers’ need to
convert his product into cash.
Maximize profits through sales
maximization
“ we must somehow hook the
customer”
Marketing orientations
Focuses on the needs of the
buyer
Preoccupied with the idea of
satisfying the needs of the
customer by means of the
product and the whole cluster of
things associated with creating,
delivering and finally, consuming.
Maximize profits through
increased consumer satisfaction
& hence raise market share.
“ what can we do that will make
product better than competitors
in the customer mind”
 Selling V/S Marketing

There will always be need for some selling. But the

aim of marketing is to make selling superfluous. The aim of
marketing is to know and understand the customer so well
that the product or service fits him and sells itself.

Ideally, marketing should result in a customer who is

ready to buy. All that should be needed is to make the
product and service available.
Peter Drucker.
 Evolving Views of Marketing’s Role

Finance
Production
Production Finance
Human
resources
Marketing Human
resources Marketing

a. Marketing as an b. Marketing as a more

equal function important function
Evolving Views of Marketing’s Role

Production Finance

Production
Marketing
Human Customer
resources
Marketing

Finance Human
resources
c. Marketing as the d. The customer as the
major function controlling factor
Evolving Views of Marketing’s Role

Production

Marketing
Human
resources
Customer

Finance
e. The customer as the controlling
function and marketing as the
integrative function
Right Decisions to be taken by
Marketing Managers
What features to design into a new product?


What prices to offer to customers?

Where to sell products?

How much to spend on advertising, sales or the internet?

What will be the exact wording or colour for new packaging?

 Functions of CMOs

Strengthening the brands

Measuring marketing effectiveness
Driving new product development based on customer
needs
Gathering meaningful customer insights
Utilizing new marketing technology
Core Concepts of Marketing

Needs, Wants, and Demands

Target Market, Segmentation & Positioning

Product or Offering
Value and Satisfaction
Exchange and Transaction
Relationships and Networks
Marketing Channels
Supply Chain
Competition
Marketing Environment- task & broad
This Is a Need

Needs
Basic human requirements
including physical, social, and
individual needs.
This Is a Want

Wants

Form that a human need

takes, as shaped by
culture
and individual personality.
 This Is Demand
Wants Buying Power

“Demand”
 I want it, I need it…

Five Types of Needs

Stated needs
Real needs
Unstated needs
Delight needs
Secret needs
 Different Orientations

Reactive Market Orientation

Understanding and meeting customers’ expressed needs

Proactive Market Orientation

Focus is on customer latent needs.

Total Market Orientation

Combination of the above two.
Companies which follow this are likely to be the most successful.
 Segmentation and Target Marketing
#1 #2

Market Segmentation:
Divide the market into
segments of customers

Target Marketing:
Select the segment to
cultivate
 Positioning

It is the valued place which a product enjoys in the minds of the target buyers
as delivering some central benefit to them.

Examples:
Volvo – Car for those whom safety is major concern.
Scorpio – For people who prefer sturdy vehicle that offers luxury and
comforts.
 Need / Want Fulfillment

Needs and Wants

Fulfilled through a
Marketing Offer :
Some combination of
products, services,
information, or experiences
offered to a market to satisfy
a need or want.
 Brands

Brand is an offering from a known source.

Brand names such as McDonalds’ carries association in

people’s minds that make up the Brand Image;
Hamburgers, Fun, Children,
Fast food, convenience and Golden Arches

All companies strive to build a strong favorable and unique

Brand Image.
 Value and Satisfaction

Value
Value reflects the sum of the perceived, tangible and
intangible benefits and cost to customers.
It is primarily a combination of quality, service and price
called the ‘ Customer Value Triad’.
Value is a central marketing concept.

Satisfaction
Satisfaction reflects a persons’ judgement of a products’
perceived performance in relation to expectation.
 Value and Satisfaction

Expectation Performance Expectation Performance

8 10 10 8

If performance is lower than expectations, satisfaction is low.

If performance is higher than expectations, satisfaction is high.
 Exchange, Transactions and
Relationships
Exchange is the act of obtaining a desired object from someone by offering
something in return.
Exchange means that people do not need to depend on handouts, or need to have
the skills that are required to produce every necessity for themselves.
Exchange is the core concept of marketing. For an exchange, several conditions
must be satisfied:
lAt least two parties must participate, and each must offer something that the

other values.
lEach party must want to deal with the other, and be free to accept or reject an

offer.
lEach party must be able to communicate and deliver the offer.
 Exchange, Transactions and Relationships
A transaction is marketing’s unit of measurement, and
consists of a trade of value between two parties.
In transactions it must be possible to clearly define what each
party is giving and gaining.
Relationship marketing is the process of creating, maintaining
and enhancing strong, value-laden relationships with
customers and other stakeholders
The Company’s Macro environment
Actors in the Microenvironment
 What is a Market?

The set of actual and

potential buyers of a
product.
These people share a
need or want that can be
satisfied through
exchange relationships.
 Defining Marketing
Marketing is a societal process by which individuals and groups obtain
what they need and want through creating, offering, and freely exchanging
products and services of value with others.

Aim of marketing
Know & understand customer so well that product fits & sells itself
 What is Marketing?

Marketing is an organizational function

and a set of processes for “creating,
communicating, and delivering value
to customers and for managing
customer relationships”
in ways that benefit the
organization and its stakeholders.
What is Marketing Management?

Marketing management is the

art and science
of choosing target markets
and getting, keeping, and growing
customers through
creating, delivering, and communicating
superior customer value.
What is Marketed?

Goods

Services
Events & Experiences

Persons

Places & Properties

Organizations
Information

Ideas
 properties
goods

What is Marketed
Events &
experiences Services

information

Ideas
 Who Markets?

Marketer and Prospect

A Marketer is someone who seeks a response- attention, a
purchase, a vote, a donation- from another party called the
prospect.
Marketers are responsible for demand management.
 Demand States

Negative Nonexistent Latent

Declining Irregular

Full Overfull Unwholesome

 Simple Marketing System

Communication

Goods/services
Industry Market
(a collection (a collection
of sellers) of Buyers)
Money

Information
 Structure of Flows
Resources Resources

Money Resource Money

markets
Services,
money Taxes,
goods
Services, Taxes
money
Manufacturer Government Consumer
markets markets markets
Taxes,
goods Services

Services, Taxes,
money goods

Money Money
Intermediary
Goods, services markets Goods, services
Market places, Market spaces

Market place is physical, such as a store you shop in.

Market space is digital, as when you shop on the internet.
 Metamarkets

A cluster of complementary products & services

that are closely related in the minds of consumers, but
spread across a diverse set of industries.
e.g. Automobile metamarket
Metamarket is a web based market centered
around an event or an industry, rather than a single
product, where everything connected with a certain
market can be found.
e.g. Edmunds.com for the auto industry,
Askman.com for men.
Holistic Marketing orientation- Development , design &
implementation of marketing programs , processes &
activities that recognizes their breadth &
interdependence
Integrated The Four Ps
marketing The Four Cs

Marketing
Mix

Place
Product

Convenience
Customer
Solution Price Promotion

Customer Communication
Cost
 Internal Marketing

Internal marketing is the task of hiring, training, and motivating able

employees who want to serve customers well.

Copyright © 2009
 Performance Marketing

Financial Accountability Social Initiatives

Social Responsibility Corporate social
Marketing marketing
Cause marketing
Corporate philanthropy
Corporate community
involvement
Socially responsible
business practices
Societal Marketing Concept

Society
(Human Welfare)

Cosumer Company
(Want Satisfaction) (Profits)
Marketing Management Tasks

Marketing strategies

Building strong brands

Connecting with customers

Delivering value

Communicating value

Creating long term growth

Consumer Centric Innovations

? What can you do with a boring product like a dishwash bar?

?Can you bring excitement into it?

?Is it possible to make INNOVATIONS to a product like dishwash bar?

 Innovation

•It is a key factor to ensure a bright future of a

company.
Gillete, 3M, Google, Apple have their entire
organisation focussed on innovation.
 Indian Companies on Innovation

Indian marketers are also not far behind.

Indian companies have been able to provide breakthrough marketing practices that
acts as a model for emulation for their western counterparts.
e.g. E-Chaupal of ITC, Project Shakti of HUL, GCMMF
 Consumer Centric Innovations

TATA ACE
Mini truck with engine capacity of less than one ton launched by Tata Motors in 2005.
Product based on deep understanding of the market needs & customer requirements.
Consumer Centric Innovations

T – 20 Cricket: A breakthrough product

The marketplace isn’t what it used to be…

Information technology

Globalization
Deregulation

Privatization

Competition

Convergence
Consumer resistance
Retail transformation
 New Consumer Capabilities
A substantial increase in buying power
A greater variety of available goods and
services
A great amount of information about practically
anything
Greater ease in interacting and placing and
receiving orders
An ability to compare notes on products and
services
An amplified voice to influence public opinion
 Marketing Planning Process
Analyzing marketing opportunities
Selecting target markets
Designing marketing strategies
Developing marketing programs
Managing the marketing effort
 Discussion Question

Marketing shapes consumer needs and

wants versus marketing reflects the needs
and wants of consumers.