Defining Marketing for the 21st Century 1 Marketing Management

Chapter Questions Why is marketing important? What is the scope of marketing? What are some fundamental marketing concepts? How has marketing management changed? What are the tasks necessary for successful marketing management?

Good Marketing is No Accident The roaring success of four-wheeler Tata Ace, in a market earlier dominated by three-wheeler load carriers, was due to a deep understanding of the market needs and customer requirements.

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.

Selling is only the tip of the iceberg “There will always be a 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 or service available.” Peter Drucker

What is Marketed? Goods Services Events & Experiences Persons Places & Properties Organizations Information Ideas

Successful New Product Launches Require Careful Planning

Scope of Marketing Who markets? Marketer, someone who seeks a response from another party, called Prospect Marketers are responsible for Demand Management Negative demand: consumers dislike the product and may even pay to avoid it Non-Existent: consumers may be unaware of or uninterested in the product. Latent: consumers may share a strong need that cannot be satisfied by an existing product. Declining: consumers begin to buy the product less frequently or not at all. Irregular: seasonal Full: consumers are satisfactorily buying all products. Overfull: more consumers would like to buy the product Unwholesome: consumers may be attracted to products that have undesirable social consequences.

Demand States Nonexistent Latent Declining Irregular Full UnwholesomeOverfull Negative

Scope of Marketing Who markets? Key Customer Markets Consumer companies selling mass consumer goods Branding | Mass selling Business Professional buyers | well-informed Global Companies in global marketplace must decide which countries to enter when to enter and how to enter. Adaptability | Operational matters N0n-profit & Government Companies selling to non profit need to have careful pricing. E.g temples etc. Highly price sensitive | Competitive pricing

Key Customer Markets Consumer Markets Business Markets Global Markets Nonprofit/ Government Markets

Figure 1.1 Structure of Flows in a Modern Exchange Economy

Figure 1.2 A Simple Marketing System

Scope of Marketing Who markets? Marketplaces, Marketspaces & Metamarkets Marketplaces Physical | buying yourself Marketspaces Online | ‘Ordering’ Metamarkets A cluster of complementary products and services closely related in the minds of people however spread across a wide industry etc automobile industry used cars, new cars, dealers, insurance, financing, spare parts etc. Complimentary products

Core Marketing Concepts Needs, wants, and demands Target markets, positioning, segmentation Offerings and brands Value and satisfaction Marketing channels Supply chain Competition Marketing environment

Fundamental Marketing Concepts Core Concepts Needs Basic Human Requirements Wants Needs which are directed to a specific object Demands Wants for specific products backed by ability to pay (acquire)

Fundamental Marketing Concepts Core Concepts Understanding Needs Stated Real Unstated Delight Secret –Pair of jeans –Quality –Affordable, Branded –A good discount deal –‘wanna’ look cool!!!

Fundamental Marketing Concepts Core Concepts Satisfying everyone……how? Segmentation Different segments based on several factors Target Markets Segments presenting greatest opportunity Positioning Positioned carefully as delivering certain benefits….

Fundamental Marketing Concepts Core Concepts Offering Positioning is “crafted” into an offering Value proposition: a set of benefits that satisfy needs. Brands An offering from a known source

Fundamental Marketing Concepts Core Concepts Value ‘perceived’ tangible and intangible benefits and costs to customers Satisfaction Fulfillment of a need *WRONG* Person’s comparative judgments resulting from a product’s perceived performance If performance < expectations: dissatisfied/dissapointed If performance<=expectations: satisfied/delighted

Fundamental Marketing Concepts Core Concepts Marketing Channels Communication channels interacting with target buyers Distribution channels display, sell or deliver Service channels facilitating transactions with buyers

Fundamental Marketing Concepts Core Concepts Supply Chain Marketing Channel: Marketer to target buyer while Supply Chain: A complete value delivery system From Raw materials to components to final buyers

Fundamental Marketing Concepts Core Concepts Competition all the actual and potential rival offerings and substitutes that a buyer might consider Coke’s competition (?)

Company Orientations Production SellingMarketing Product

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Company Orientations toward the marketplace The Holistic Marketing Concept “Everything matters” Based on the development, design and implementation of marketing programs, processes, and activities that recognizes their breadth and interdependenices 4 Components Relationship marketing Integrated marketing Internal marketing Social responsibility marketing

Figure 1.4 Holistic Marketing Dimensions

Figure 1.5 The Four P’s

Internal Marketing Internal marketing is the task of hiring, training, and motivating able employees who want to serve customers well.

Performance Marketing Financial Accountability Social Responsibility Marketing Social Initiatives Corporate social marketing Cause marketing Cause-related marketing Corporate philanthropy Corporate community involvement Socially responsible business practices

Marketing Management Tasks Develop market strategies and plans Capture marketing insights Connect with customers Build strong brands Shape market offerings Deliver value Communicate value Create long-term growth