B.E.

SEMESTER: V
Marketing Management
(Inst. Elective II)
Prof. Siraj Bloch | Faculty Of Management, MEFGI siraj.bloch@marwadieducation.edu.in | 8128668957

* * * * * * = 3 Subjects

Prof. Siraj Bloch

What is Marketing ??
According to American Marketing Association

Science and art of exploring, creating and delivering value to satisfy the
needs of a target market at a profit.

Prof. Siraj Bloch

Need Want & Desire - Marketing Research | Product Development | Product + Value | Consumer Behaviour & Loyalty 3

Existence Of Marketing Barter System / Exchange Concept (till 1950)

Production Concept(till 1970s)
(till 1980s)

Product Concept

Selling Concept(till 1990s)

Marketing Concept
Holistic Marketing Concept
Prof. Siraj Bloch

Marketing Vs. Sales POP Vs. POD

Brand Vs. Product Branding

Role of Marketing Manager
Prof. Siraj Bloch

Efforts Vs. Results

STP in Real Life

Age: 18 - 24 College goers Using mouth fresheners Conscious about Bad-mouth order Need: Fresh breath & White teeth

Age: 5 - 15 School Kids Dont like brushing Forced to brush twice a day Need: Strong & Healthy teeth

Prof. Siraj Bloch

STP in Real Life

Prof. Siraj Bloch

Classical STP

Segmentation
Grouping of people having similar needs.

Prof. Siraj Bloch

Classical Segmentation

Geographic:
Region & Climate, Density & Size, Town/Metro

Demographic:
Age, Gender, Life Cycle, Occupation, Income

Psychographic:
Lifestyle & Personality

Behavioural:
Occasions, Uses & Benefits, Attitudes
Prof. Siraj Bloch

Process Of Segmentation

Need Base Segmentation

e.g. Bike Category

Homogenous within segment & Heterogeneous from other segments

Prof. Siraj Bloch

10

Classical STP

Targeting
Choosing one of those segments.

Prof. Siraj Bloch

11

On the basis of.

Targeting

Competition
Margin & Penetration

Your Competency
Strength & Background

PLC Stage
Growth Potential & Profitability

Prof. Siraj Bloch

12

Harley Davidson 1%ers

1970

Targeting

1%ers
HELLS ANGELS - 2007

Prof. Siraj Bloch

13

Exercise - 1
Soap Category Car Category Shoe Category

Shampoo Category
Mobile Phone Category Apparels Category
Prof. Siraj Bloch

14

Classical STP

Positioning
What your TG think about you. A space in the minds of the consumers.

Desire Vs. Actual

Prof. Siraj Bloch

15

How to do it

Positioning

By Product Attribute:
Size, # years in business, largest

By Benefits:
Leader in certain benefits, fastest pain relief / whiter than white

By Usage Occasion:
Orange juice in breakfast, Chocolate In sweet

By Users:
Best for some user group, J&J

Vs. Competitors:
Better than competition, Coke & Pepsi, 7up Uncola
Prof. Siraj Bloch

16

Positioning In Practice
Strengthen own position -> By Claims:
Now 25% bigger, 30% whiter

Reposition yourself according to some unmet needs:

Lifebuoy rough use to family soap Savlon Dettol was irritating & burning

Deposition competition:
All Political parties coke Pepsi is sweet Pepsi Nothing official about it
Prof. Siraj Bloch

17

Identify Positioning

Prof. Siraj Bloch

18

S T P .

Complete the Exercise - 1

Prof. Siraj Bloch

19

Marketing Mix

4Ps = Marketing Mix

Product (Solution) New Product Development Price (Cost, Price, Value) Positioning Place (Availability) Distribution

Promotion (Brand Vs. Sales) Push Vs. Pull

Prof. Siraj Bloch

Apple | Merq | Lorial & Dell | HUL Vs. P&G

20

Consumer Behavior

I.

Pre-purchase High Involvement Purchase (Impulse Purchase) Low Involvement Post-purchase (Experience)

II.

III.

Prof. Siraj Bloch

21

Consumer Behavior Process

Repeat

Problem Recognition

Information Search

Evaluation

Decision

BUY

Reject

Prof. Siraj Bloch

22

Marketing Research
According to American Marketing Association

Process that links customer, consumer and trade to marketers through information which can identify the opportunity or solve the problem.
According to Cooper and Schindler

Systematic enquiry that provides information

to guide managerial decisions.

Prof. Siraj Bloch

23

Why Marketing Research??

Decision Making on the basis of:

A.

Management Information System

B.

Business Intelligence System

Marketing Research

C.

Prof. Siraj Bloch

24

Marketing Research

Research Approach: A. Qualitative B. Quantitative Types of Research: 1) Exploratory Research 2) Descriptive Research 3) Causal Research

Prof. Siraj Bloch

25

Marketing Research
Sources of Data Collection (Types of Data): A. Primary Data B. Secondary Data Sampling Methods: A. Probability (Random/Stratified Random) B. Non-probability (Convenient / Quota / Judgmental)

Why Sampling? Sample Size

Prof. Siraj Bloch

26

Marketing Research Process

1) 2) 3) 4) 5) 6) 7)

Problem or opportunity identification Meeting of Decision Maker and Market Researcher Converting management problem to research problem Formal research proposal Approaches to research (Research Designing) Field work and data collection Data preparation and data entry

8)
9) 10)

Performing data analysis

Interpretation of result and presentation of findings

Management decision and its implementation

27

Prof. Siraj Bloch

Product Life Cycle

Sales

Profits

Product Development

Introduction

Growth Time

Maturity

Decline

Prof. Siraj Bloch

28

New Product Development Process

Marketing Strategy
Concept Development and Testing Idea Screening Idea Generation

Business Analysis Product Development

Test Marketing Commercialization

New Product Development Process

Prof. Siraj Bloch

29

Pricing
Price is the economic value of the product (good & services)
normally expressed in terms of money.

Price is an agreement between sellers and buyers at which goods and services are exchanged for money.

Price is the specific value at which the product is exchanged. Thus, it is an exchange value of product expressed in monetary form.

Prof. Siraj Bloch

30

Different views on Price

Consumers point of view:
Price is a means for getting the product.

Consumer pay for expectations

Price is perceived value: Physical product + Other Benefits

(after sales services, guarantee, warrantee, prestige, brand

image, credit facility, installation, education)

According to them, the price is equal to all types of

satisfactions or benefits derived from the product.

Prof. Siraj Bloch

31

Different views on Price

Marketers point of view:
Value of total offerings

Cost of Physical Product + Promotion + Services + Distribution

Prof. Siraj Bloch

32

Pricing Approaches
Cost-plus Pricing:
Set the price at your production cost, including both cost of goods and fixed costs at your current volume, plus a certain profit margin.

Target Return Pricing:

Set your price to achieve a target return-on-investment (ROI).

Fair Pricing:
Sometimes it simply doesn't matter what the value of the product is,

even if you don't have any direct competition. There is simply a limit
to what consumers perceive as "fair".
Prof. Siraj Bloch

33

Pricing Approaches
Value-based Pricing:
Based on the value it creates for the customer This is usually the most profitable form of pricing, if you can

achieve it. (As per the Brands Equity)

The most extreme variation on this is, "pay for performance" pricing for services, in which you charge on a variable scale according to the results you achieve.

Prof. Siraj Bloch

34

Pricing Approaches
Psychological Pricing
Ultimately, you must take into consideration the consumer's perception of your price, figuring things like:

Positioning:
"low-cost leader priced lower than competition High on price = High on quality

Popular price points: There are certain "price points" (specific prices) at which people become much more willing to buy a certain type of product. Rs. 99 Rs. 199 Shop $99
Prof. Siraj Bloch

Rs. 299 etc and Rs. 149 Rs. 179

35

Pricing Approaches
Creaming or skimming Loss leader Penetration pricing Discrimination Pricing Premium pricing Dynamic pricing High-low pricing Freemium Pricing (Early Buyers Electronic Gadgets)

(Reliance Handset Telecom Services) (Gaining Market Share initially) (Time, Day, Age, Loyalty Cards) (Artificially high positioning) (Online portal Air ticket) (Starting at .) (Trial Activation)

Prof. Siraj Bloch

36

Factors affecting Pricing Decisions

1) Targeted Segment 2) PLC Stage 3) Economic Trend 4) Product Development Cost

5) Perceived value of product

6) The level of competition

Prof. Siraj Bloch

37

Product Mix
Product Line: Group of Closely Related Products
1. Soap, Shower Gel, hand wash liquid, Face wash 2. Shampoo, Conditioner, Hair Oil, Syrum 3. Talcum powder, Fairness Cream, Sun-scream, Anti-aging Cream

Product Mix: Set of all Product Lines (1, 2 and 3)

Product Width = 3 Product Length = 4 x 3 = 12 Product Depth = 2 size x 3 Flavors = 6 Product Consistency = Similarity between Product Lines

(Personal Care, Toilet Products, Hygiene Products)

Prof. Siraj Bloch

38

Prof. Siraj Bloch

39

Definition of Advertising
Advertising is paid form of non personal communication about an organization, product, service or idea by an identified sponsor.

Public Service Announcement (PSA)

Non-personal = TV, radio, magazines, newspapers

Prof. Siraj Bloch

40

Classification of Advertising
Advertising to Consumer
(1) National

(2) Local
(3) Product Vs. Category Development

Advertising to Business & Professional

(1) Business to Business (2) Professional (3) Trade Above The Line Vs. Below The Line (ATL Vs. BTL)
Prof. Siraj Bloch

41

Advertising Medium
1) TV 2) Radio

3) Print (Magazine & News Paper)

4) Outdoor 5) Internet / Social Networking

6) Visual Merchandising
Advantages Vs. Disadvantages
Prof. Siraj Bloch

42

Advertising Budget
Percentage of Sales method

Objective and Task method

Competitive Parity method Market Share method Affordable method

Prof. Siraj Bloch

43

Measuring Advt. Effectiveness

1) Why to Measure? 2) When to Measure? 3) Where to Measure? 4) What to Measure? 5) How to Measure?

Prof. Siraj Bloch

44

Measuring Advt. Effectiveness

1) Attraction TOM 2) Uniqueness Clear POD 3) Relevant Recall & Association 4) Persuasion Conviction & Loyalty

Ad Pre-testing Dipstick

Prof. Siraj Bloch

45

Media Decisions

INDUSTRIAL PRODUCTS

CONSUMER PRODUCTS

SELLING
PR/SPONSORSHIP WOM

MEDIUMS
ADVERTISING PACKAGING POINT OF SALE PROMOTIONS

Prof. Siraj Bloch

Source: Data Modeling

46

Media Decisions
ADVERTISING PERSONAL SELLING PROMOTIONS

Awareness

Interest

Conviction

Purchase

Post-Purchase

Objectives
Prof. Siraj Bloch

Source: Data Modeling 47

Prof. Siraj Bloch

48

Agency Culture in Marketing

Prof. Siraj Bloch

49

Packaging
A package is the physical container or wrapping for a product.

A packaging is also:
Face of the Product Communication Medium A Sales person / A Motivator

Packaging @ Different Levels:

1) Raw Materials 2) Manufacturers 3) Retailers
Prof. Siraj Bloch

50

Functions of Packaging
Its functions include:
Defining product identity (Positioning - Green) Detailing about product (Benefits, Pricing & Storage) Meeting customer needs (Form & Size) Protection

Promotion
Educating / Ensuring Safe Use Regulation (Ingredient & Nutritional Value) Patented Identification

Prof. Siraj Bloch

51

WHAT IS BRANDING?

Desire Positioning

Actual Positioning

Customer is a value maximizer Brand is a risk reducer

Prof. Siraj Bloch

52

Brand is a Risk Reducer

Functional risk: The product does not perform up to expectations.

Physical risk: The product poses a threat to the physical health of the user or others.
Financial risk: The product is not worth the price paid. Social risk: The product results in embarrassment from others.

Psychological risk: The product affects the mental well-being of the user.
Time risk: The failure of the product results in an opportunity cost of finding another satisfactory product.
53

Prof. Siraj Bloch

Role of Sales Force

Identifying Prospects (Google/McDonalds) Demonstration (Test Drive) Closing Sales (Automobiles) Relationship Building (Petrol Pumps) Post-Sales Service (Electronics) Collecting Feedback (Bachat Pack)
Prof. Siraj Bloch

54

Sales Force Design

Sales Territory Design Geographical Area Total Market Potential (Number of possible accounts * Buying power)

Sales Force Design No of total Customer + Prospects in a territory

Workload
(Current Account * Avg. time to serve an account + Prospects * Time spent to convert prospect into customer)

Prof. Siraj Bloch

55

Size of Salesforce
Methods to determine size of Salesforce

Breakdown Method

Salesforce size =

Forecasted Sales__________ Productivity per sales person = $10,000,000 / $250,000/sales rep = 40 sales reps

Uses Sales Value Easy to use and understand Best in stable selling environment
Prof. Siraj Bloch

56

Size of Salesforce
Methods to determine size of Salesforce Workload Method (Number of account * average time spent)

6,300 hours required to cover the market = 6.42 Reps. 980 hours per salesperson, actual selling time

Uses Volume and Selling efforts in time Conceptually Very Sound Method
Prof. Siraj Bloch

57

Size of Salesforce
Methods to determine size of Salesforce

Incremental Method
(Return on Investment Method)

Uses Average Return of Present Sales Person Comparison of Cost and Return

Prof. Siraj Bloch

58

Marketing Control Process

Marketing control is the process of taking actions to bring the desired results and actual result closer.

Many a times actual marketing results deviate from the expected results due to the change in the government regulation or change in competitors strategy and likewise.

An efficient and effective marketing control system can help in

detecting such deviations and take suitable and appropriate measures to control them.

Prof. Siraj Bloch

59

Marketing Control Process

Goal Setting

What do we want to achieve?

Performance Measurement

What is happening?

Performance Diagnosis

Why is it happening?

Corrective Actions
Prof. Siraj Bloch

What should we do about it?

Continuous and Internal

60

Marketing Audit
According to American Marketing Association - AMA

Marketing audit is a systematic and impartial review or appraisal of the total marketing operation.

Objective:
How well the marketing department of a company works or functions.

Prof. Siraj Bloch

Yearly and external

61

Marketing Audit

Prof. Siraj Bloch

62

Marketing Audit Process

Agreement on objectives. Scope and approach

Data collection

Report preparation and presentation

Steps in a Marketing Audit

Prof. Siraj Bloch

63

Marketing Audit Data collection

Factor Reputation Extension of credit Sales representatives Technical Support services Literature and Manuals Prompt Delivery Quick Response Customers Needs Product Price Personal Relationships Complete Product Line Product Quality
Prof. Siraj Bloch

All users rank 5 9 8 1 11 2 to 3 6 10 7 4

Company salesmen rank 1 11 5 3 10 4 2 6 7 9 8

Company Nonsales personnel rank 4 9 7 6 11 5 3 1 8 10 2

64

Marketing Audit
External Audit focuses on: Business & Economic Environment Internal Audit focuses on: Sales

Political Economy Social Technological

Total Sales Revenues Geographic Reach Visibility & Availability

Market & Competition

Size Trends Channels Customers Industry Behaviour

Marketing
Planning Vs. Execution Objective Analysis Desired Brand Vs. Actual Growth in Market Share

Prof. Siraj Bloch

65

Industrial Product Classification

Raw material
Farm products Natural Products

Manufactured Materials & Parts

Component materials Component parts

Capital Items
Installation Services Equipment
Prof. Siraj Bloch

66

Product Distribution
One of the 4Ps Process of making product available Direct or Through Intermediaries (Channels) Distribution Levels: Zero Level / One Level / Two Level Channel

Distribution Types: Intensive / Selective / Exclusive Distribution

Channel Mix: Different Level + Types at a time

Prof. Siraj Bloch

67

International Marketing
Why International Marketing is different from Local Marketing:

Culture

Climate
Law and Regulations Environment: Political, Economical, Sociological and Technological Trends and Customer Habits

Prof. Siraj Bloch

68

International Marketing

Trade off Between Standardization Vs. Customization in Marketing Mix Product, Price, Place and Promotion

Prof. Siraj Bloch

69

Prof. Siraj Bloch

70

sirajbloch@gmail.com

Thank You