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- Dr.C.Senthil Nathan MBA, M.Phil, Ph.D(Marketing Area)

Faculty of Management

American Marketing Association- Definition- Marketing is an organizational function and a
set of process for creating, communicating and delivering value to customers and for
managing customer relationships in ways that benefit the organization and its stakeholders.
Marketing Management: is the art and science of choosing target market and getting,
keeping and growing customers through creating, delivering and communicating superior
customer value.
(III) Difference between Marketing & Selling:
Marketing concept is to achieve organizational goals that company is being more effective
than competitors in creating, delivering and communicating superior customer value to your
chosen target markets.
Selling concept holds that consumers and business, if left alone wont buy enough of the
organizational products. The organization must therefore undertake an aggressive selling and
promotional effort. In selling company sell what they make, rather what market wants.
Selling is applicable to unsought goods such as insurance and encyclopedia.


Selling focuses on need of seller
Selling is preoccupied with sellers
need to convert his product into cash

Marketing focuses on needs of buyer
Marketing is satisfying needs of
customer by means of product and
whole cluster of things associated with
creating, delivering and finally
consuming it.

Consumer will prefer products that are widely available in market and inexpensive. Here
company focuses on high production efficiency, low costs and mass distribution. This
concept is used when a company want to expand in the market.

According this concept consumers favour products that offer most quality, performance or
innovative features. Mangers in these organisation focuses on making superior products and
improving them over time. The drawback is managers are so obsessed with love affair with
product without focussing on consumer needs, proper pricing, distribution, advertising and
Selling concept holds that consumers and business, if left alone wont buy enough of the
organizational products. The organization must therefore undertake an aggressive selling and
promotional effort. In selling company sell what they make, rather what market wants.
Selling is applicable to unsought goods such as insurance and encyclopedia.
Marketing concept is to achieve organizational goals that company is being more effective
than competitors in creating, delivering and communicating superior customer value to your
chosen target markets.
It is based on development, design, and implementation of marketing programs, process and
activities that recognizes their breath and interdependencies. Four component of Holistic
(i) Internal Marketing
(ii) Integrated Marketing
(iii) Performance Marketing
(iv) Relationship Marketing


McCarthy classified marketing activities under 4ps called Marketing Mix.
(i) Marketing Mix: It is tool in the hands of marketing manager to attract the target
audience towards the product. It is used to influence the consumers and trade channels
towards companys product. There are 4ps in marketing Product, Price, Place and
(a)Product: Product variety, Quality, Design, Features, Brand Name, Packaging, Sizes,
Services, Warranties and Returns
(b) Price: List Price, Discounts, Allowances, Payment period, Credit terms.
(c) Promotion: Sales Promotion, Advertising, Sales force, Public relations and Direct
(d)Place: Channels, Coverage, Assortment, Location, Inventory and Transport
(ii) Need, Wants and Demand:
Need: This is basic human requirement. People need air, food, water, clothing and shelter to
survive. Strong needs are recreation, entertainment etc.
Want: Need becomes want when they are directed towards a specific object that satisfy the
need.(Thirsty consumer may go fresh juice, some may go energy drink, some may go for
carbonated drink)
Demand: This is want for specific product and backed by ability to buy the product.
(iii) Target Market, Positioning and Segmentation: Marketers identify and profile distinct
group of buyers who might prefer or require varying product and service mixes by examining
demographic, psychographic and behavioural difference among buyers.
After identify the segments that marketer then decide which segment offers greatest
opportunity- called Target Market.
Positioning: For market offering(product, service etc) it positions in the mind of target
buyers as delivering some central benefits.
(iv) Offering and Brand: Needs of company is addressed by putting a Value proposition
a set of benifits that they offer to customer to satisfy their needs. Intangible value proposition
is made physical by an offering which can be combination of product, service, information
and experience.

Brand is an offering from known source. It is name, sign, symbol or combination of all these
to identify one seller and differentiate him from other seller.

(v) Value and Satisfaction:

Value= qsp(quality, service and price).
Satisfaction reflects a persons judgement on a product perceived performance in relationship
with expectations regarding the product.
(vi) Marketing Channels:
There are 3 types- Communication Channel, Distribution channel, service channel.
Communication channel- TV, Radio, Newpaper, billboards, poster etc
Distribution Channel- Distributer, wholesaler, retailer, agent etc
Service Channel- Warehouse, Transportation companies, banks and insurance.
(vii) Supply Chain:
It involves longer channel from raw material to components to final products
that are carried to final buyers.
(viii) Competition:
Competition includes all actual and potential rival offerings(competitors that
might arise in future) and substitutes a buyer might consider.
(ix) Marketing Environment:
Task Environment: This environment includes the actors who are
manufacturing, distribution and promoting the product.- Company, distributers, dealers,
target customers and suppliers( material suppliers and service suppliers-marketing research
agencies, ad agencies, bank and insurance)
Broad Environment: Demographic, Economic, Physical, Technological,
Political legal and Social-cultural environment. Marketers should pay close attention to the
trends developing in this environment.
Major Societal forces:
Industrial age was characterised by mass production and mass consumption stores stuffed
with inventory, ads everywhere and rampant discounting. The information age promises to

lead to more accurate level of production, more targeted communication and more relevant
(ii) Globalization: Technological advances in transportation, shipping and communication
have made it easier for companies to market in other countries and easier for consumers to
buy products and services from marketers in other countries
(iii) Deregulation: Deregulation and liberalization in various industrial sector had led to
foreign Direct investments to create greater competition and growth opportunities. Various
sectors like Airlines, Insurance is providing different and better services to customers as a
result of deregulation
(iv) Privatization: Many countries like India, Great Britain are privatizing public sector
companines for better results. In UK British Airways and British Telecom are handed overto
private management for better results. In India VSNL and MTNL are given to private
management for better results
(v) Heightened Competition: There is intense increase in competition from domestic and
foreign brands results in rising promotion costs and shrinking profit margin. Retailers are
giving competition in shelf space by introducing their own brands competing with national
brands. Many brands are entering into related product categories. For example Britannia is
entering into bread, curd from biscuits sector to create mega brand.
(vi) Industry Convergence: Intersection of two or more industries leads to new marketing
opportunities. Computing and electronics collaboration had lead to ipod, tab etc.
(vii) Consumer resistance: Consumer resists promotions and advertisements they avoid
products and they feel over market
(viii) Retail transformation: Small retailers are facing competition from big retailers. Big
retailers are facing competition from e-commerce sites such as flip cart. Retailers are
providing customer experience of product , service and entertainment to compete with online

Analyzing the Marketing Environment for Needs:
FAD: This is short-term opportunities provided by Market. Short lived(IPL
Players hairstyle, Jersy etc)
Trend: Reveals shape of future and provide future direction( SMS based
communication, Whatsapp based communication)

Megatrend: Slow to form once in place it will be there for 7 to 10 years (Face
book, E-Mail etc)

(A)Mega/Macro Environment:
(i) Political Environment,
(ii)Demographic Environment
(iii) Natural Environment,
(iv) Legal Environment,
(v)Technology Environment,
(vi)Socio-cultural and
(Vii) Economic Environment
(a)Demographic Environment:
Population size: 76% percentage of world population are in less developed countries and
growing at 2% per year whereas population in most developed country are growing at 0.6%
Population Growth rate: China worlds largest population, Followed by India(16.7% of
world population- In 2025 there will be 1395 million people & 1593 million people by 2050.
Population Age Mix: Average age in India-23.8, Pakistan-20.3, Bangladesh-23.8, Srilanka29.5. Japan, US aged population. Marketers are targeting young Age group-15 to 25 Years.
Religious composition: Hindus, Muslims, Christians, Buddhism
Literacy level: School dropouts, UG, PG,Doctorates etc.
Workforce composition: Workers, Engineers, Doctors, Lawyers,
Household Patterns: Single, Married without kids, Married with kids, Joint family,
Divorced, Widowed.
Regional characteristics: Asian, European, Middle east.
Within-India- North, East, South, West. Urban, Semi-urban and Rural.

(b)Economic Environment:
Economic environment comprises the following:
GDP of the country: Gross Domestic product of the country will be studied by companies.
It is the value of total volume of goods and services produced in a country during a year or
particular period of time.
Prices, Savings, Debt and credit availability should be studied in India.
Foreign Exchange Reserve: In a strict sense, foreign-exchange reserves should only include
foreign banknotes, foreign bank deposits, foreign treasury bills, and short and long-term
foreign government securities held by Reserve Bank of India(RBI). However, the term in
popular usage commonly also adds gold reserves, special drawing rights (SDRs),
and International Monetary Fund (IMF) reserve positions.
Inflation: Inflation is the percentage change in the value of the Wholesale Price Index (WPI)
on a year-on year basis. It effectively measures the change in the prices of a basket of goods
and services in a year. In India, inflation is calculated by taking the WPI as base.
Income classification of Indian Consumers:(McKinsey Report 2007)
Annual Income Classification in India (per Annum):
Globals- > Rs.10 Lakhs
Strivers- Rs.5,00,000 Rs.10,00,000
Seekers- Rs.2,00,000-Rs.5,00,000
Aspirers-Rs.90,000- Rs.2,00,000
Deprived- Less than Rs.90,000

(c) Socio-cultural Environment:

Consumer belief, values and norms largely define consumer tastes and preferences.
Belief, value and norms are influenced by happening in society.
Six major faiths in India- Hindu, Christian, Muslim etc
Languages-1600 out of this 22 languages are officially recognized
Dress code and Food habits vary from state to state

Education is given utmost importance by all Indians.

All above affect product design, variety, packaging and promoting the products.
(d) Natural Environment:
Preserving environment and reducing pollution is given utmost priority by
government considering global warming and climate change scenario. Companies are
incorporating environment policy in overall company policy so wastage of resources such as
power, water is practiced. Recycling, renewable energy source are coming into practice.
Eco-friendly packaging, discouraging use of plastic covers also encouraged by companies.
(e)Technological Environment:
New technology in every product category is making old products obsolete.
Mobile phone, Smart phone, Smart watches, Smart eyewear, Tabs are replacing are reducing
sales of product category such as Landline phones, walkman, Personal computers.
Blackberry had become obsolete because of smart phones introduced by prominent players
such as apple, Samsung, Nokia etc.
Technological changes affect sales of product and their life period forcing marketers to
introduce upgraded products.
(f) Political- Legal Environment:
Government Policies: Changes in political scenario formulation of new government in
centre as well as state leads to new policies. The policies will affect marketing of products.
Government Laws: Mobile phone without harmful materials. Food items without harmful
ingredients that affect the health are laws prevailing in country. Marketers should understand
the law and its implications for successful marketing.
MRP(Maximum Retail Price) in packaging is essential as per Indian law.
Six Rights of Indian Consumers: Safety, Information, Choice, Representation and Redressal.
All government policies and laws of land should be understood and monitored carefully by
companies to modify their marketing strategies to suit new developments