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Changing Economy & Marketing Scenario

Prof. G.M. Chowdhury IBA, DU

February 2013

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Marketing takes a day to learn. Unfortunately it takes a

lifetime to master.
Philip Kotler, Marketing Guru

Business has only two functions marketing and innovation.

Milan Kundera, writer of Czech origin

CREATIVITY is thinking up new things. INNOVATION is doing

new things
Theodore Levitt, Marketing Guru

The aim of marketing is to know and understand the customer so well the product or service fits him and sells itself.
Peter Drucker, Marketing Guru

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Objectives
In this session we will address the following questions:
What is the new economy like? What are the tasks of marketing? What are the major concepts and tools of marketing? What orientations do companies exhibit in the marketplace?

How are companies and marketers responding to the

new challenges?

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Three Certainties have to be observed by successful companies

Global forces will continue to affect everyones business and personal life. Technology will continue to advance and amaze us. There will be a continuing push toward

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deregulation of the economic sector.

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Three developments that spell endless opportunities

Globalization Technological advances and

Deregulation But what is marketing and what does it

have to do with these issues?
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Marketing Defined
Marketing deals with identifying and meeting human and social needs. One of the shortest denitions of marketing is meeting needs protably.

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Marketing Defined..Contd.

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According to a social denition, marketing is a societal process by which individuals and groups obtain what they need and want through creating, offering, and exchanging products and services of value freely with others. As a managerial definition, marketing has often been described as the art of selling products. Peter Drucker, a leading management theorist, says that The aim of marketing is to make selling superuous. The aim of marketing is

to know and understand the customer so well that the product or

service ts him and sells itself. Ideally, marketing should result in a customer who is ready to buy.
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The New Economy

Substantial increase in buying power

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A greater variety of goods and services

A greater amount of information about practically anything A greater ease in interacting and placing and receiving orders

Companies can facilitate and speed up communications

among employees.

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The New Economy ..Contd.

Companies can have 2-way communication with
customers and prospects Companies can customize offerings and services to individual customers. The Internet can be used as a communication channel for purchasing, training, and recruiting.

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Marketing Task
Rules of radical marketing

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The CEO must own the marketing function. Make sure the marketing department starts small and flat and stays small and flat. Get face to face with the people who matter most the customers. Love and respect your customers. Create a community of consumers. Rethink the marketing mix. Be true to the brand.

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Marketing Task ..Contd.

Three stages of marketing practice:
Entrepreneurial Marketing

Formulated Marketing
Intrepreneurial Marketing

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The Scope of Marketing

Places
Properties Organizations Information Ideas

Goods
Services

Experiences
Events Persons

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Core Marketing Concepts

Marketplace, Marketspace, and Metamarket Marketers and Prospects

Needs, Wants, and Demands

Product, Offering, and Brand Value and Satisfaction Competition Marketing Environment
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Marketing mix

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Marketing Approaches
production concept
product concept selling concept marketing concept and societal marketing concept.

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Marketing Approaches
Production Concept

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One of the oldest, which holds that consumers

prefer products that are widely available and inexpensive.
Managers concentrate on achieving high production efficiency, low costs, and mass distribution.

Makes sense in developing countries, where consumers are

more interested in obtaining the product than in its features. Also used when a company wants to expand the market.
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Marketing ApproachesProduct Concept

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Holds that consumers favor those products that offer the most quality, performance, or innovative features.
The focus is on making superior products and improving them over time, assuming that buyers can appraise quality and performance. Companies design their products with little or no customer input Can lead to marketing myopia.

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Marketing ApproachesSelling Concept

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Holds that consumers and businesses, if left alone, will ordinarily not buy enough of the organizations products. The organization must, therefore, undertake an aggressive selling and promotion effort.
As consumers must be coaxed into buying, the company has a battery of selling and promotion tools to stimulate buying. Practiced most aggressively with unsought goodsgoods that buyers normally do not think of buying, such as insurance and funeral plots. Also practiced when firms have overcapacity. Their aim is to sell what they make rather than make what the market wants.
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Marketing Concept

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Holds that the key to achieving organizational goals consists of the company being more effective than its competitors in creating, delivering, and communicating customer value to its chosen target markets.
Rests on four pillars:
target market customer needs integrated marketing and protability.

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Marketing Approaches
Selling
focuses on the needs of the seller preoccupied with the sellers need to convert his product into cash takes an inside-out perspective.

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Marketing
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 nally consuming it. takes an outside-in perspective starts with a well-dened market, focuses on customer needs, coordinates activities that affect customers, and produces prots by satisfying customers.

takes an inside-out perspective starts with the factory, focuses on existing products, and calls for heavy selling and promoting to produce protable sales.

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Societal Marketing Concept

The societal marketing concept calls upon marketers to build social and ethical considerations into their marketing practices

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How Business and Marketing are Changing

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Company responses and adjustments

Reengineering Outsourcing E-commerce Benchmarking Alliances Partner-suppliers Market-centered Global and local Decentralized

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How Business and Marketing are Changing

Marketer Responses and Adjustments
Customer relationship marketing Integrated marketing

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Customer lifetime value

Customer share Target marketing

communications
Channels as partners Every employee a marketer

Customization
Customer database

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