Why it is supremely important to have satisfied customers?

1.Buys more & stays loyal 2.Buys additional products as the company introduces 3.Talks favorably about the company 4.Pays less attention to competing 5.Costs less to serve then new consumer

What is Marketing???
Marketing is a social and managerial process by which individuals and groups obtain what they need and want through creating, offering, and exchanging products of value with others

Marketing is simply creating demand for you product

Importance of Marketing
Marketing influences many aspects of peoples daily lives
All goods and services they buy Stores in which they purchase Radio and TV programs they consume are paid for by advertising CV they produce to impress potential employers

Marketing offers exciting career paths Marketing is important to every organisation

Importance of Marketing
Marketing concepts and techniques are also relevant for non-profit companies Marketing plays a major role in economic growth and development by
Stimulating research and new ideas, resulting in new goods and services Providing choice among products which may satisfy customers, resulting in fuller employment, higher incomes and higher standards of living

Scope of Marketing
Goods

Scope of Marketing
Experiences

Scope of Marketing
Events

Scope of Marketing
Persons

Scope of Marketing
Services

Scope of Marketing
Places

Scope of Marketing
Ideas

Scope of Marketing
Information

Scope of Marketing
Organizations

Environment Environment

Modern Marketing System

14

sE U d n E rE e s U d n E rn e s U d r e s U d n r e ta e kM rM a M t e k r t e k r a

iM ta e kM rM a M g n ie tk e k rr a g n ia t g n i t e k r g n e m rt e tn n II sI e in rr a iIe d e m re e tm s e ia rin a id d s e it r e m r e s e i r a i d

Environment

a p m o C y n a p m o C y n a p m o C y n a p m o C y n e kt rM a M (( )k rr e ta e k rt a M (e )) rr e te e k r a M ( ) r e
e iu lS p p u S sS rS e ip lu p p s rp e ip lu s r e i l p s r

e p m o C s rm o to iC tC e p m o s riC o tt ie tp s r o t e p m o s r o t i t

Some Basic Concepts

Need A state of felt deprivation of some basic satisfaction Wants Are desire for specific satisfiers to fulfill the needs Demand Are wants for specific products that are backed by an ability and willingness to buy them

Some Basic Concepts

Market Offering Some combination of products, services, information or experiences offered to a market to satisfy a need or want Customer Value A customers estimate of a products over all ability to satisfy his or her needs

Some Basic Concepts

Customer Satisfaction The extent to which a products perceived performance matches a buyers expectations

Some Basic Concepts

Value The difference between the benefits a customer derives from an offering and the cost of those benefits A good or service that does not meet a consumers needs results in low customer value, even if the price is very low A higher price may be acceptable if the desired benefits are obtained

Some Basic Concepts

Very Important to remember Customer are and will always be value maximizers
An organisation that offers superior customer value is likely to win and keep customers

In how many ways People can get what they want?

Four ways people can obtain what they want 1.Self-production 2.Coercion 3.Begging 4.Exchange

Marketing emerges when people decide to satisfy their needs & wants through exchange

For Exchange To Take Place

5 conditions must exist 2 parties Something of value for other Capable of communication Free to accept or reject the offer It is appropriate or desirable to deal with the other party

Market
A set of All actual and potential buyers of a product 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 Market Place Physical market as like shopping centre Market Space Digital market as on the web

What is Marketing???
Marketing is a social and managerial process by which individuals and groups obtain what they need and want through creating, offering, and exchanging products of value with others

Marketing is simply creating demand for you product

4 Types of business orientations

Production Concept
Consumer will favor those product that are widely available and low in cost Managers of production oriented organizations concentrate on achieving high production efficiency and wide spread distribution

Product Concept
Consumer will favor those product that offer the most quality, performance, or innovative features

Managers of these organizations focus their energy on making superior products and services and improving them overt time

Selling Concept
Consumer if left alone ordinarily will not buy enough of the organizations products The organization must undertake an aggressive selling and promotion effort Many organization practice selling concept when they have over capacity Their aim is to sell whet they make rather then what the market buys

Marketing Concept
Key in achieving organizational goals consist in determining the needs and wants of target markets and delivering the desired satisfaction more effectively and efficiently than competitors

Marketing and Sales Concepts Contrasted

Starting Point
Factory

Focus
Existing Products

Means
Selling and Promoting

Ends
Profits through Volume

Market

Customer Needs

Integrated Marketing

M e h T th e k rT a o C g n ie p e c n tM M e h T ta e k rn a o C g n ir p e c n tk t e o C g n i p e c t M e h T t e k r a o C g n i p e c n t

S e h T g n ie lh lT e c n o C tS p e S e h T g n il ll le e c n o C ti p e g n c n o C t p e S e h T g n i l l e c n o C t p e
Profits through Satisfaction
29

Regardless of its orientation, marketing managements crucial task is to create profitable relationships with customers

Customer Relationship Management

The overall process of building and maintaining profitable customer relationships by delivering superior customer value and Satisfaction

Relationship Building Blocks

Customer Perceived value

Customer Satisfaction

Difference between Total Customer Value and Total Customer Cost

The extent to which a products perceived performance matches a buyer's expectations

Customer Delivered Value

Total Customer Value

Total Customer Cost

Product Value Service Value Personnel value Image value

Monetary Cost Time Cost

Energy Cost Psychic Cost

Strategic Planning
The process of developing and maintaining a strategic fit between the organizations goals and capabilities and its changing marketing opportunities
Corporate Level
Business Unit, Product, and marketing level

Defining the Company Mission

Setting Company Objectives and Goals

Designing the business Portfolio

Planning marketing and other functional strategies

Mission Statement
A statement of the organizations purpose what it wants to accomplish in the larger environment

SWOT Analysis / TOWS Matrix Strength Internal Environment Weaknesses Opportunities Threats External Environment

Company Objectives/GOALS

SMART
Specific Measurable Achievable Realistic Time Bound

Designing Business Portfolio

The collection of Businesses and Products that make up the company

Analyze the current businesses -Establish SBUs -Assign resources to SBUs Planning new business, downsizing or terminating older business

Growth / downsizing
Product/market expansion Grid Existing Products New Products Curren t Market New Market
Market Penetration Strategy Market Development Strategy Product Development Strategy Diversification Strategy

Planning Marketing
Partner Relationship Management Working closely with partners in other company departments and outside the company to jointly bring greater value to customer

Partnering with others in the company Partnering with others in marketing System

Value Chain

The series of departments that carry out valuecreating activities to design, produce, market, deliver and support a firms products

Value Delivery Network

The network made up of the company, suppliers, distributors, and ultimately customers who partner with each other to improve the performance of the entire system

The Marketing Process

1. Analyzing Marketing Opportunities

4. Managing the Marketing Effort

2. Selecting Target Markets

3. Designing Marketing Mix

The Marketing Process

Market Segmentation Dividing the total market into distinct groups of Buyers who have distinct need, characteristics, or behavior and who might require a separate product Target Marketing The process of evaluating each market segments attractiveness and selecting one or more segments to enter

The Marketing Process

Market positioning Arranging for a product to occupy a clear, distinctive, and desirable place relative to competing products in the minds of target customers

Marketing Strategy for CA

The marketing Logic by which the business hopes to achieve its marketing objectives Market Leader Strategies Market Challenger Strategies Market Follower Strategies Market Nicher Strategy

The Marketing Mix

The set of controllable tactical marketing tools that the firm blends to produce the response it wants in the target market Product Price Place 4 Ps of Marketing Promotion

Managing The marketing Effort

Marketing Control
The process of measuring and evaluating the results of marketing strategies and plans and taking corrective action to ensure that objectives are achieved

Marketing Audit
A comprehensive, systematic, independent, and periodic examination of a companys environment, objectives, strategies, and activities to determine problem areas and opportunities to recommend a plan of action to improve the companys marketing performance

Contents of a Marketing Plan

Executive Summary Current Marketing Situation Threats and Opportunity Analysis Objectives and Issues Marketing Strategy Action Programs Budgets Controls

Forces Shaping the Digital Age

Digitalization & Connectivity

Customization & Customerization

Digital Age

The Internet Exploion

New Intermediaries

Forces Shaping the Digital Age

Intranet the network that connect people in the each other and to the company network Extranet A network that connects a company with suppliers and distributors Internet computer network that allows users all to connect with each other company to

its

over globe

Forces Shaping the Digital Age

Customization taking the initiative to individualize the marketing offering Customerization Leaving it to individual customers to design the marketing offering

E-Business The use of electronic platforms intranets, extranets & internet to conduct a companys business E-Commerce Buying and selling processes supported by electronic means, primarily the internet E-Marketing Companys effort to communicate about, promote and sell products and services over the internet

E-Commerce
Benefits to Buyers Convenient Easy & Private Greater product Access & Selection Comparative information Interactive and immediate

Benefits to Sellers Customer relationship building Reduced Cost Incensing speed and efficiency Flexibility Global reach

E-Commerce Domains
Targeted to Consumers Initiated By business Initiated By Consumers B2C Business to Consumer C2C Consumer to Consumer Targeted To Business B2B Business to Business C2B Consumer to Business

Managing Marketing Information

Marketing Information Systems

Marketing Information Systems, consist of people, equipment & procedures to gather, sort, analyze, evaluate and distribute needed, timely, and accurate information to the marketing decision makers Elements of MIS 1.Internal Records 2.Marketing Intelligence 3.Marketing Research

Marketing Intelligence
The systematic collection and analysis of publicly available information about competitors and day to day developments in the market Sources of MIS 1.Sales Force 2.distributors, retailers & other intermediaries 3.Competitors products/open house seminars/employees

ustomer advisory cell urchase information from outside source

Marketing Research
Marketing Research is a systematic design, collection, analysis, and reporting of data and findings relevant to a particular or specific marketing situation facing the company MR Firms fall into 3 categories 1.Syndicated service research firms 2.Custom marketing research firms 3.Specialty-line marketing research firms

Define the problem & research objectives

Developing Research Plan for collecting Information

Implementing the research plan collecting and analyzing information

Interpreting and reporting the findings

Research Objectives
Exploratory Research
Gathers preliminary information that will help define the problem and suggest hypotheses

Descriptive Research

Describes things as market potential for a product or the demographics and consumers attitudes Test hypotheses about causeand-effect relationships

Causal Research

Step 2 Research Plan

Research plan development follows these steps:
Determining Specific Information Needs Gathering Secondary information Planning Primary Data Collection

Information Sources
Secondary
Information that already exist somewhere, having been collected earlier or for other purposes

Primary

Data

In formation collected for the specific purpose at hand

Both Must Be: Relevant Accurate Current Impartial

Research Approach
Observational Research
Gathering data by observing people, actions and situations (Exploratory)

Survey Research
Asking individuals about attitudes, preferences or buying behaviors (Descriptive)

Experimental Research
Using groups of people to determine causeand-effect relationships (Causal)

Most Widely Used Form

Contact Method

Mi al F x i y le iblit Q a t yo u nit f D t C lle t d aa o c e C nr l o o to f Ine v w r t r ie e C nr l o o to f S m le a p S e do D t p e f aa C lle t n o c io Rs os Rt e p n e ae Cs ot Po or Go od E c ll n xeet F ir a Po or F ir a Go od

T le h n e poe Go od Fi ar Fi ar Ecl n x ele t Ecl n x ele Go od Fi ar t

Pr o a es n l E c lle t xe n E c lle t xe n Po or F ir a Go od Go od Po or

Ol e nin Go od Go od F ir a Po or E c lle t xe n Go od E c lle t xe n

Sampling Plan
Sample A segment of population selected for marketing research to represent the total population Who??? How Many??? How???

Research Instruments
Research Instruments

Questionnaire
What questions to ask? Form of each question? Closed-end Open-end Wording? Ordering?

Mechanical Devices
People Meters Supermarket Scanners

Step 3. Implementing the Research Plan

Marketing Research Process

Most Expensive & Subject to Error

70

y lA a n A t g n in z e h y l a t g n i z e h

a t a D a t a D

e s e R h c r a n a lR P e s e h c r a n a l P

e c o r P g n iP s s e h t e c o r g n i s s e h t

a t a D a t a D

c e lo lC o C t g n il t e h c e l t g n i t e h

a t a D a t a D

Marketing Research Process

Step 4. Interpreting and Reporting Findings Researcher Should Present Important Findings that are Useful in the Major Decisions Faced by Management.
1 p e t S e t n I . t e r p r F e h t g n it d n iS s 1 p e e t n I . t e r p r F e h t g n i d n i s 2 p e t S a r D . o C w s u lS c n s n o it 2 p e a r D . o C w s u l c n s n o i 3 p e t S p e R . t t r o n a M o m e g a t n e 3 p e t S p e R . t t r o n a M o m e g a t n e
71

Consumer Markets and Consumer Buying Behavior

Consumer Market All individuals and households who buy or acquire goods and services for personal consumption Consumer Buyer Behavior Buying behavior of final consumers The central question for marketers is: How do consumers respond to various marketing efforts the company might use?

Model of Buyer Behavior

Marketing and Other Stimuli
Marketing
Product Price Place Promotion

Buyers Black Box

Buyer Characteristics Buyer Decision Process

Buyer Responses
Product Choice Brand Choice Dealer Choice Purchase Timing Purchase Amount

Other

Economic Technological Political Cultural

74

Factors Influencing Buying Behavior

Four types of factors shape and influence a consumers buying behavior Cultural Social Personal Psychological

Factors Influencing Buying Behavior Cultural factors

Culture
Basic values, perceptions, wants and behaviors learned from family and other institutions people with shared values system based on common life experiences and situations

Sub Culture

Relatively permanent and ordered divisions in a society whose members share similar values, interest and behaviors

Social Class

Factors Influencing Buying Behavior

Social Factors
Groups

Family

Roles & Statuses

Opinion Leaders:- Person within a reference group who, because of

special skills, knowledge, personality, or other characteristics, exerts influence on others

Factors Affecting Consumer Behavior: Personal Personal Influences Personal Influences

Age and Life Cycle Stage Cycle Stage Economic Econom ic Situation Situation Personality & Personality & Self-Concept Self-Concept

Occupation Occupation

Lifestylee tific tio L s leId Identification ife ty n a n

Activities A tiv s c itie Interests In re ts te s Opinions O in n p io s
78

Factors Influencing Buying Behavior

Psychological Factors Motivation Motivation Perception Perception Learning Learning Beliefs & Attitude

Assignment

Types Of Buying Decision Behavior

High

Low

Brand differences

Significa nt Few

Complex Buying Behavior Dissonance reducing Buying behavior

Variety-seeking buying Behavior Habitual Buying Behavior

Involvement

Buying Decision Process

Purchase Decision Evaluation of Alternatives Information Search Need Recognition Post purchase Behavior

Need Recognition
Buyer Recognizes State Where the a Buyers Needs are Problem or Fulfilled and the a Need. Buyer is Satisfied.

Needs Arising From: Internal Stimuli Hunger External StimuliFriends

rE e p xi E a ix tx n e iE u o S lp s e c rp re e a ie tiE n e ir u o S ln s e c rt a ix u o S lp s e c r r e a i t n e u o S l s e c r cS iu lP b u P rP u o S s e c c ib lu b rlP u o S s e c c iu r u o S s e c c i l b r u o s e c m m o C a iC cl rC e u o S lo s e c ro m m a im c rm e u o S le s e c rr a iC c u o S lo s e c r m m a i c r e u o S s e c r o sn rP e P S lP a n e cs re u o s o s rr e S ls a n e c ro u o s S lP a n e c r u o s o s r e S l a e c r u o

Information Sources

Mass Media Consumer-rating groups Advertising, salespeople Receives most information from these sources Family, friends, neighbors Most effective source of information

Handling the product Examining the product Using the product

Evaluation of Alternatives
Consumer May Use Careful Calculations & Logical Thinking Consumers May Buy on Impulse and Rely on Intuition Consumers May Make Buying Decisions on Their Own. Consumers May Make Buying Decisions Only After Consulting Others.

Marketers Must Study Buyers to Find Out How They Evaluate Brand Alternatives

Purchase Decision
Desire to buy the most preferred brand

Purchase Intention

Attitudes of Others

Unexpected Situational Factors

Purchase Decision

Post Purchase Behavior

Satisfied Customer!

Consumers Expectations of Products Performance. Products Perceived Performance.

Dissatisfied Customer

Adoption Process
Awareness: Consumer is aware of product, but lacks information. Interest: Consumer seeks Information about new product. Evaluation: Consumer considers trying new product. Trial: Consumer tries new product on a small scale. Adoption: Consumer decides to make regular use of product.

Adoptors Categories
Percentage of Adopters
Early Majority Late Majority

Innovators

Early Adopters
13.5%

34%

34% 16%

Laggards

2.5%

Time of Adoption Late

Early

Infl. of Product Char. On ROA

Can results be easily observed or described to others?

Communicabilit y

Is the innovation superior to existing products?

Relative Advantage

Can the innovation be used on a trial basis? Is the innovation difficult to understand or use?

Divisibility

Complexity

Does the innovation fit the values and experience of the target market?

Compatibilit y

89

Segmentation, Targeting and Positioning

Evolution of marketing strategy

3 stages 1.Mass Marketing 2.Product-Variety Marketing 3.Target Marketing

Target Marketing:- The process of

evaluating each market segments attractiveness and selecting one or more segments to enter

Why Target Marketing???

1.Helps identify marketing opportunities better 2.The seller can develop right offer for the right market 3.The price, distribution & adv. Can be adjusted to reach the consumers effectively 4.They can focus on buyers whom they have the greatest chances to satisfying

Market Segmentation 1.Identify basis for segmenting the market & segment it 2.Develop profiles of resulting segments Market Targeting 3.Evaluate the attractiveness of each segment 4.Select the target segment

Market Positioning 5.Develop positioning for target segments 6.Develop a marketing mix for each segment

Major Segmentation Methods

1.Geographic Segmentation 2.Demographic Segmentation 3.Psychographic Segmentation 4.Behavioral Segmentation

Requirement for Effective Segmentation

To be useful segments must be; 1.Measurable 2.Substantial 3.Accessible 4.Differentiable 5.Actionable

Evaluating Market Segments

Two major factors 1.Overall attractiveness of the segment 2.Company Objectives & Resources Over all attractiveness
Structural Attractiveness 1, Intense segment rivalry Threat of new entrants of substitute products Bargaining power of buyers 5, bargaining power of suppliers

- Size & Growth

2, 3, Threat 4,

Selecting Target Market

Targeting Broadly Undifferentiated (Mass) Marketing

Differentiated (Segment) Marketing

Concentrated (Niche) Marketing

Micromarketing (local or individual) Marketing Targeting Narrowly

Positioning for Competitive Advantage

Product Position The way the product is defined by consumers on important attributes The place the product occupies in the consumers mind relative to competition Competitive Advantage Advantage over competitors gained by offering consumers greater value, either by providing more benefits that justify higher price

Positioning through Differentiation

Differentiation is the act of designing a set of meaningful differences to distinguish the companys offer from competitors offers Product Differentiation Services Differentiation Personnel Differentiation Image Differentiation

Positioning Errors
Underpositioning-Buyers have a vague idea of the brand , they dont really sense anything special about it Overpositioning-Buyers may have too narrow an image of the brand Confused image of too many Positioning-Buyers may have a confused the brand because of company making claims or repositioning frequently

Which Differences to Promote?

Not all brand differences are meaningful or worthwhile , a difference will be stronger to the extent that it satisfies the following criteria 1.Important 2.Distinctive 3.Superior 4.Preemptive 5.Affordable 6.Profitable

Value Proposition
The full positioning of a brand the full mix of benefits upon which it is positioned