Principles of Marketing

Safiullah Mengal IMS University

of Balochistan
 Safiullah Mengal IMS University of
Balochistan

RECOMMENDED BOOKS
• Philip Kotler, Principles of Marketing,
Printice Hall
• McCarty & Perreault, Jr., Basic
Marketing: A managerial approach, IRWIN
 Safiullah Mengal IMS University of
Balochistan

What is Market?
• “A market consists 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” (Philip Kotler).
 Safiullah Mengal IMS University of
Balochistan

What is Marketing?
• Marketing is a social process by which
individuals and groups obtain what they need
and want through creating and exchanging
products and value with others…. PHILIP KOTLER
 Safiullah Mengal IMS University of
Balochistan

Marketing……..
The essence of Marketing is a transaction - an
exchange- intended to satisfy human needs and
wants. There are three elements in the marketing
process :
(A) MARKETERS
(B)WHAT IS BEING MARKETED
(C) TARGET MARKET
MARKETING CONCEPTS
Needs, Wants and Demands
• Needs – Basic Human Requirements
• Wants – Directed at specific objects
• Demands – Backed by ability to pay

Target Markets, Positioning & Segmentation

Offerings and Brands

• Offering – Value Proposition made Tangible
• Brand – Offering from a known source

Value & Satisfaction

• Value – Benefits / Cost
• Customer Value Triad – Quality, Service and Price
• Satisfaction – Product’s perceived performance

Marketing Channel
• Communication Channel – Deliver & Receive
message
• Distribution Channel – Display, sell & Deliver
• Service Channel – Carry out transactions
 Safiullah Mengal IMS University of
Balochistan

Cont.…Marketing Concepts
Needs:
• The most basic concept underlying marketing is that of human needs.
• Human needs are states of felt deprivation.
• Human have many complex needs:
• Physical needs for food, clothing, warmth, and safety
• Social needs or belonging and affection
• Individual needs for knowledge and self – expression
Wants:
• Want are the form taken by human needs as they are shaped by culture and
individual personality.
• People have almost unlimited wants but limited resources.
• They want to choose products that provide the most value and satisfaction
for their money.
Demands:
• When backed by buying power, wants become demands.
• Consumers view products as bundles of benefits and choose products that
give them the best bundle for their money.
 Safiullah Mengal IMS University of
Balochistan

Cont.…Marketing Concepts
Product:
• Anything that can be offered to a market to satisfy a need or want.
• The concept of product is not limited to physical objects – anything
capable of satisfying a need can be called a product.
Services:
• In addition to tangible goods, products also include services, which are
activities or benefits offered for sale that are essentially intangible and do
not result in the ownership of anything.
 Safiullah Mengal IMS University of
Balochistan

Cont.…Marketing Concepts
Exchange :
• The act of obtaining a desired object from someone by offering
something in return
• For exchange potential to exist, five conditions must be satisfied:
• (1) there are at least 2 parties,
• (2) each party has something that might be of value to the other party,
• (3) each party is capable of communication and delivery,
• (4) each party is free to accept or reject the exchange, and
• (5) each party believes it is appropriate or desirable to deal with the
other party
 Safiullah Mengal IMS University of
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Transaction :
• A trade between two parties that involves at least two things of value, agreed –
upon conditions a time of agreement, and a place of agreement.
Relationship marketing :
• The process of creating, maintaining, and enhancing strong, value – laden
relationships with customers and other stakeholders .
• Marketers and Prospects:- A Marketer is someone who seeks a
response-attention ,a purchase, a vote, a donation-from another
party, called the prospect. If two parties are seeking to sell something
to each other, we call them both marketers.
 Safiullah Mengal IMS University of
Balochistan

Cont.…Marketing Concepts
• Target Market: a particular group of consumers at which a
product or service is aimed.
• Positioning: A marketing strategy that aims to make a brand
occupy a distinct position, relative to competing brands, in the
mind of the customer
• Segmentation: is the process of dividing a market of potential
customers into groups, or segments, based on different
characteristics.
 Types of Markets Safiullah Mengal IMS University of
Balochistan

• Consumer Markets: Companies selling mass consumer goods and services such as soft drinks, cosmetics, air
travels,
• Business markets:  marketing practice of individuals or organizations (including commercial businesses,
governments and institutions). It allows them to sell products or services to other companies or
organizations that resell them, use them in their products or services or use them to support their works.
• Global Markets: The changes in the cost of transportation, government policies and the overall need for
expansion have given an impetus to globalization. The strategies of global market companies may differ from
each other but the core concept is the same. Most global marketing companies work on one fundamental.
“Think local, act global”. The company which comes at the top of my mind is McDonalds and Coca Cola. Both
known for their global presence as well as for the way they customize their message based on the country
they are in.
• Government or non profit markets: The government market mainly involves Government offices, ordnance
factories, army, navy and other government departments. The non profits on the other hand may involve
groups based on different beliefs some of which really have an excellent brand name and are recognised by
several companies. Both of these entities have a limited purchasing budget and hence the price of products
is important. Accordingly the purchase process is organized.
 Safiullah Mengal IMS University of
Balochistan

Cont.…Marketing Concepts
• Brand: is a set of perceptions and images that represent a company,
product or service.
• Offering: is the total offer to your customers, is more than the product
itself and includes elements that represent additional value to your
customers, such as availability, convenient delivery, technical support or
quality of service.
• Value: also known as customer-perceived value, is the difference
between a prospective customer's evaluation of the benefits and costs
of one product when compared with others.
 Safiullah Mengal IMS University of
Balochistan

• Marketing channel: is the people, organizations, and activities

necessary to transfer the ownership of goods from the point of
production to the point of consumption. 
• Supply chain: is longer channel stretching from raw materials to
components to final products that are carried to final buyers.)
• Competition: is the rivalry between companies selling similar
products and services with the goal of achieving revenue, profit.
• Marketing environment: refers to factors and forces that affect a
firm's ability to build and maintain successful customer
relationships
 Safiullah Mengal IMS University of
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Demand States----
• Eight demand states possible:
• Negative demand - consumers dislike the product and may
even pay to avoid it.
• Nonexistent demand - consumers may be unaware of or
uninterested in the product.
• Latent demand - consumers may share a strong need that
cannot be satisfied by an existing product.
Declining demand - consumers begin to buy the product less
frequently or not at all.
 Safiullah Mengal IMS University of
Balochistan

Demand States…
• Irregular demand - consumer purchases vary on a seasonal,
monthly, weekly, daily or even hourly basis.
• Full demand - consumers are adequately buying all products put
into the marketplace.
• Overfull demand - more consumers would like to buy the
product than can be satisfied.
• Unwholesome demand - consumers may be attracted to
products that have undesirable social consequences.
 • Dental Work

Negative Demand • Vaccination

DEMAND STATES
• Foreign Language Courses

No Demand

• Harmless Cigarettes

Latent Demand • Fuel-Efficient Cars

• print media would be classified as a dying industry, CD Players etc

Declining Demand

• The best example of irregular demand is seasonal products like

Irregular Demand umbrellas, air conditioners or resorts

• Changing Preference

Full Demand • Increasing Competition

• Demarketing

Overfull Demand

Unwholesome • Cigarettes
• Alcohol

Demand • Best example of unwholesome demand are cigarettes, alcohol, pirated

movies, guns etc.
WHAT IS MARKETED?
GOODS PLACES

SERVICE
S
EXPERIENCES EVENT
S
PERSONS
PROPERTI
ES INFORMATION

ORGANIZATION
S IDEAS
 Safiullah Mengal IMS University of
Balochistan

What is Marketed
• 1.Goods: Physical good constitute the bulk of most countries’
production and marketing efforts. Each year companies market
cars, trucks, television sets, machine tools, industrial chemicals ,
watches , cosmetics, and various other mainstays of a modern
economy.
• 2.Services: Services include the work of airline, hotels, car rental
firms, barbers and beauticians, maintenance and repair people,
and accountants.
 Safiullah Mengal IMS University of
Balochistan

What is Marketed……..
• 3.Events: Marketers Promise time-based events, such as major
trade shows, artistic performances. Marketers promote time-
based events, such as trade-shows, artistic performance, Asian
Games, Sport-events etc.
• 4.Experiences: An amusement park or a water park represents
experiential marketing.
• 5.Persons: Celebrity marketing is a major business. To-day,
every major film star has an agent, a personal manager and ties to
a public relations agency. For Examples, artists, musicians,
physician etc.
 Safiullah Mengal IMS University of
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What is Marketed……..
• 6.Organisations: Organizations actively work to build a strong,
favourable and unique image in the minds of their target publics.
Universities, museums, performing arts organisations and non-
profits all use marketing to boost their public images and to
compete for audiences and funds.
• 7.idea:Every market offering includes a basic idea. “In the
factory, we make cosmetics; in the store we sell hope.” Social
marketers are busy in promoting such ideas
 Safiullah Mengal IMS University of
Balochistan

What is Marketed……..
• 8.Places:Cities, states, regions and whole nations compete
actively to attract tourists, factories, company headquarters and
new residents. Further examples: commercial banks, local
business associations, real estate agents, Economic development
specialists etc.
 Safiullah Mengal IMS University of
Balochistan

What is Marketed…….
• 9. Properties: Properties are intangible rights of ownership of
either real property (real estate) or financial property (stocks,
bonds etc.). Properties are bought and sold, and this requires
marketing.
• 10.Information:Information can be produced and marketed as
a product. This is essentially what schools and universities
produce and distribute at a price to parents, students and
communities. For examples, magazines, encyclopedias, news-
papers etc. supply information.
• Ideas
 Safiullah Mengal IMS University of
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MARKETING PHILOSOPHIES
• The role that marketing plays within a company varies according to the
overall strategy and philosophy of each firm.
• There are five alternative concepts under which organizations conduct their
marketing activities:
▫ Production concept
▫ Product concept
▫ Selling concept
▫ Marketing concept
▫ Societal marketing concepts
 Safiullah Mengal IMS University of
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Production Concept
• The philosophy that consumers will favor
products that are available and highly affordable
and that management should therefore focus on
improving production and distribution
efficiency.
 Safiullah Mengal IMS University of
Balochistan

Product Concept
The philosophy that consumers will favour products that offer the
most quality, performance, and innovative features.
 Safiullah Mengal IMS University of
Balochistan

Selling Concept
The idea that consumers will not buy enough of the organization’s
products unless the organization undertakes a large – scale selling
and promotion effort.
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Balochistan

Marketing Concept
The marketing management philosophy that holds that achieving
organizational goals depends on determining the needs and wants
of target markets and delivering the desired satisfactions more
effectively and efficiently than competitors do.
 Safiullah Mengal IMS University of
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Societal Marketing Concept

The idea that the organization should determine the needs, wants,
and interests of target markets and deliver the desired
satisfactions more effectively and efficiently than competitors in a
way that maintains or improves the consumer’s and society’s well
– being.
COMPANY ORIENTATION
The Production
Concept
• Oldest Concept
• Consumers will prefer products that are widely
available & Inexpensive
• Concentrate on achieving high production efficiency,
low costs and mass distribution
• Eg: - Lenovo and Haier in China

The Product Concept

• Consumers favor products that offer most quality,

performance and innovative features.
• Make superior products and improve them over time.
• Caught in a “love-affair” with their product.
COMPANY ORIENTATION
The Selling Concept
• Consumers, if left alone, wont buy enough of the
organization’s products.
• Must undertake an aggressive selling and promotion
effort.
• Practiced most aggressively with unsought goods.
• Eg:- Insurance & Encyclopedias.
• Aim is to sell what they make rather than make what
the market wants.

The Marketing Concept

• Customer Centered instead of Product Centered.

• Not to find right customers for your products, but to
find right products for your customers.
• Eg:- Dell
• Reactive Market Orientation – Understanding and
meeting customers’ expressed needs
• Proactive Market Orientation - Understanding and
meeting customers’ latent needs
• Total Market Orientation
 The Societal Marketing

COMPANY ORIENTATION
Concept

• Societal marketing
concept goes beyond the
marketing concept
because it is concerned
with the long-term
benefits of the consumers
and the well-being of
society.
• It involves the control of
pollution, inflation,
shortages and neglect of
social services.