Strategic Marketing Management

Who is Customer

Customers refer to the people or organizations that seeks satisfaction of their needs and wants. In order to achieve satisfaction they move towards Market. Some customers have needs of which they are not fully conscious or they cannot articulate these needs or use words that require interpretation by the marketer. For Examples:

A customer wants inexpensive car, the marketer has to probe into different types of needs: 1. Stated Need 2. Real Need 3. Unstated Need 4. Delight Need 5. Secret Need

What is Market, Market Place, Virtual and Meta Market

Market is a place of existing and potential buyer for a defined product or services. Market Place is the place where one goes for shopping. The Virtual market is digital market in nature. Meta Market is a cluster of complementary product or services that are closely related to the mind of customers but are spread across a diverse set of industries.

Who is Marketer?

A marketer can be a person or organization who makes available products or services and offers them to customers with the intention of satisfying consumer needs and wants. is one seeking a response from other party called the prospect or potential consumer for stimulating the demand for the companys product or services. They are responsible for demand Management.

Categories of Marketer

Responsive Marketer: Finds stated needs and feels it. Anticipative Marketer: Looks ahead into what needs a customer may have in near future. Creative Marketer: Discover and produces solutions, customer did not ask for, but to which they enthusiastically respond. For Example: Sony who always create Market.

What is Marketed?

Goods Services Events Experiences Persons Places Properties Organizations Information Ideas

Types of Demand

Negative Demand: Disliking of Product Nonexistence demand: Unaware or uninterested Latent Demand: Strong need but cannot be satisfied by existing products Declining Demand: less frequently or not buying Irregular Demand: seasonal, monthly, yearly, once in a month Full Demand: Overfull Demand: Unwholesome Demand:

Marketing Concept
The

Exchange Concepts The Production Concepts The Product Concepts The Sales Concepts

Selling vs Marketing
The firm makes the product first and then figures out how to sell it and make profit. What is to be offered as a product is determined by the customer. The firm makes a total product offering that will match and satisfy the identified needs of the customer.

Selling views the customer as Marketing views the the last link in the business. customer as the very purpose of the business; sees the business from the point of view of the customer; customer consciousness permeates the entire organization-all departments and all people in the organization-all the time.

Selling starts with the seller, and is preoccupied all the time with the needs of the seller. Seller is the center of the business universe; activities start with the sellers existing products. Emphasizes on saleable surplus available with the corporation.

Buyer is the center of business Selling vs Marketingactivities follow the buyer universe; and his needs. Emphasizes on identification of a market. Seeks to convert customer needs into product.

Marketing starts with the buyer and focuses constantly on the needs of the buyer

Seeks to quickly converts product into cash

Views business as a goods producing process

Overemphasises the exchange aspect, without caring for value satisfactions inherent in the exchange.

Views business as a customer satisfying process.

Concerns itself primarily and truly with the value satisfactions that should flow to the customers from the exchange.

Marketing Concept
The

marketing concept is essentially a point of view about business. It enunciates that business is basically a need satisfying process and that business must be managed keeping the consumer and his need as the focus. The concept prescribes that all goals of business, including profit, must be realized through consumer orientation and generation of consumer satisfaction.

Features of Marketing Concept

Consumer

Orientation Integrated Management with Marketing Consumer Satisfaction Realization of all organizational goals, including profits

Societal Marketing Concept

Societal

Marketing concepts holds that the organizations task is to determine the needs, wants and interest of targeted markets and to deliver the desired satisfactions more effectively and efficiently than competitors in a way that preserves or enhances the consumers and society's well being.

Marketing as a Managerial Functions

Marketing

is a managerial activity involves analyzing the market opportunities, planning the marketing activities, implementing marketing plans and setting control mechanisms in such a way that organizational objectives are accomplished at minimum cost.

Concept of Value
Customer

value refers to perceived value by the customer in an offer. Means he will select the product that offers him the maximum utility for the money he parts with him.

Customer value-Conventional and Contemporary Models

Conventional Model: The conventional Model of the value creation process is highly firm centric where the firm believes that the competitive edge lies in its ability to innovate. Contemporary Model: Upholds the importance of customer in the whole value creation process. The Dialogue-Access-Risk Assessment-Transparency(DART) highlights this aspect in a vivid manner.

The linkage among BenefitValue-Cost-Satisfaction

The

customer assigns different weightages for the different benefits that he seeks from the offer and make a mental note of the total value provided by the offer. That metal note of total value assigns the total weight. Customer has to pay a cost for acquiring this value.

He is happy when the value exceeds the cost that he incurs. And he gets satisfaction when on using the products, he finds that the value he actually receives matches the value that he assumed. The larger the value-cost gap, the greater is his satisfaction. Conclusion: The entire job of marketing management, commencing with planning and strategy formulation and extending to control of the marketing efforts, is concerned purely with this task arriving at the winning configuration of benefit-value-cost-satisfaction.

Enhancement of Value
Increasing

the functionality of the product Reducing the cost Giving better service support Giving the customer easy access to the product Offering beneficial communication.

Marketing is a value creating and value delivering process

The

value selection(Observing the need) Value creation / value delivering(development) Value communication(advertising, sales promotion) Value enhancement(adding features) Example: Tata Nana

Customer Value from Customers Perspectives

Personal

Esteem
Utility Social Price Quality

Customer Value and loyalty

1.

Loyalty is created only when customers perceives fairness, equity, and transparency in his/her relationship with the seller. Impact of loyalty on a firm is manifold:When a firm has been able to understand customer value and values, and has integrated it with the marketing mix, the firm is able to create and deliver a superior value to its target market. This market values this offer and hence willing to pay more. Since they are satisfied and feel delighted, they share their experience with their peers and thereby add new customers to the firms portfolio.

2. This perceived superior value by the customers fuels growth in the organization. This growth is reflected by increase in sales, profits, ROI, number of products and in the overall size of the operations 3. Superior perceived value also creates repeat business. Customers are more loyal to these firms than to others. Loyal customers also further spur the growth engine.

4.Growth and loyal customers helps firms target and retain the right employee. It must be notes that a motivated and loyal employee is a key resource in the value creation process and in turn customer loyalty. 5.Growth means more profits which makes the investor community happy and who, in turn invest more in this firm and attract more investors. 6. A motivated and loyal employee also enhances productivity and leads to cost advantage.

Marketing Mix- A sole vehicle for creating and delivering customer value

What is the mechanism through which a marketer carries out the value delivery process? The marketer delivers value to the customer basically through his market offer. He takes care to see that the offer fulfills the needs of the customer. He also ensures that the customer perceives the terms and conditions of the offer as more attractive then the other competing offers.

Marketing Mix- A sole vehicle for creating and delivering customer value
is this actually accomplished? This accomplished with the following: 1. Product 2. Transportation 3. Communication 4. Pricing
How

The Marketing Mix:- Four Ps of Marketing

James culliton, a noted marketing expert, who coined the expression marketing mix and described the marketing manager as a mixer of ingredients. To quote him, The marketing man is a decider and an artist-a mixer of ingredients, who sometimes follows a recipe developed by others and sometimes prepares his own recipe. And sometime he adapt his recipe to the ingredients that are readily available and sometimes invent some new ingredients, or experiments with ingredients as no one else has tried before.

Four Ps
Product

Place
Price Promotion

Product
Product

design, features, brand name, models, style, appearance. Product Quality, Warranty Package: Design type, material, size, appearance and labeling. Service: Pre-Sale and after-sale, service standards, service charges.

Place
Channels

of distribution: Channel design, types of intermediaries, location of outlets, channel remuneration, dealer-principal relations etc. Physical Distribution: Transportation, warehousing, inventory level, order processing etc.

 Personal

selling : Selling expertise, size of sales force and quality of sales force. Advertising: Media mix, vehicles, programmes. Sales Promotion: Publicity, public relations.

Promotion

Marketing; An interaction between marketing mix and environmental variables.

The

Market / Demand The Consumer The Industry The Competition Government Policies Supplier-related factors

Market / Demand
Nature

elastic Size of the demand, present and potential Changes taking place in demand Invasion of substitute products Changes taking place in consumption patter / buying habits.

of the demand-Inelastic and

The Consumer
Consumer

tastes and preferences keep fluctuating. Consumer brand loyalty too keeps changing. Today, he may be wanting cheaper version of given product, tomorrow may want better quality or after-sale service or may go for substitute products.

Industry and Competition

Number of seller and degree of diffentiation Degree of Globalization Keep an eye on the industry practices and competitors marketing strategy.

-Strength and Weaknesses -Strategies and Objectives

Analyze and re-evaluate your marketing strategy and bridge gap in your marketing plan.

Government Policies
Government

are often large purchases of goods and services. Govt. subsidies select firms and industries Govt. protect home producers against foreign competition.(MTNL 3G) In some cases, government happens to be producers and therefore, function as competitors.

Supplier related factors

Bargaining

power in the industry Influence the costs of raw materials and other inputs to a firm and the profits a firm can take home. They also introduces frequent changes in their products, processes and business practices.

Marketing Strategy realizes the Marketing Objectives

Marketing

strategy is the complete and unbeatable plan, designed specifically for attaining the marketing objectives of the firm / business unit. The marketing objectives indicates what the firm wants to achieve, the marketing strategy provides the design for achieving them.

 For

Example: if the marketing objectives of a business unit stipulate that next year, it should achieve a sales revenue of Rs-1000 crores and a net profit of 15 percent on sales revenue. It is the job of marketing strategy to indicate how and wherefrom this sale and profit will come, which product lines / product / brands will accomplish this task and how.

Some points to be remembered while designing the Marketing Strategy

What

position does the unit seek in its industry.(IBIBO) What market segment to serve? And what product offers to make.(ICICI) The Growth Path: Market Penetration? Market Development? Or Product Development(Maruti and Microsoft)

 Who

are my Competitors? Whom to Compete, whom to avoid. On what differentiation strength to compete. -Product superiority? -Brand Power? -Distribution Strength -Better Service On what competitive advantages will the fight be based.

Formulating the Marketing Strategy

Selecting

the target market Positioning the offer Assembling the marketing Mix. -Mix has to be worked out for every brand. -Deciding the weightage for each P. -Marketing Mix cannot be Static -Marketing Mix is the Visible Part of Marketing Strategy.

Marketing Strategies fall under two categories:

Price-Oriented

Marketing Strategy Differentiation-Oriented marketing strategy

Marketing Tools and Techniques

How

do you grab people's attention, arouse their interest, trigger their desire, and motivate them to take action? Answer that four-part question correctly and you've identified the secret to achieving tremendous sales and marketing success in your business or profession.

Marketing Tools and Techniques

Gain

Customer Confidence Penetrate awareness Sincere enthusiasm Purchasing is an emotional decision Dispel distrust Impose a deadline Embrace Web marketing

How to Gain Competitive edge

Make a marketing a daily routine. Develop a "marketing consciousness. Continually ask questions, re-evaluate your marketing plan and strategies, Start a blog Email a press Speaking of media relations and effective public relations techniques, Anticipate why a prospective customer might be reluctant or ambivalent about doing business with you. Use of free or inexpensive marketing ideas.

Online Promotional Tools

Feedback Forms Bookmarking

Content Daily Give-Away, Coupons, Contests

Surveys Awards/Testimonials Online Chat Tours

Online and offline Promotional Techniques

Article Submissions Newsletters Press Releases

Banner Advertising
Sponsorships Link Strategies News Groups Email Marketing Search Engine Optimization Affiliate Marketing Web Site Promotion Services Collateral Material Trade Shows Launch Events

Product Management
Appraisal

of each product line and each product / brand in the line. Decisions on Packaging Product differentiations and positioning Managing brand and developing brand equity New product development Managing the PLC of products / brands Managing product quality

Product Differentiation and Positioning

Differentiation

formula Differentiation based on functional value Differentiation based on additional features Differentiation through product design. Differentiation based on Quality / operational efficiency/ technology / services.

based on ingredients /

Product Positioning
Al

Ries and Jack defines: Positioning is what you do to the mind of the prospect. says: The aim of product positioning si to create a perception for our brand in the prospects mind so that it stands apart from the competing brands.

Sengupta

Main Concerns in Positioning

Positioning

means putting the product in a predetermined orbit. Positioning connects product offering with target market Consumers mind a geometric Perceptual space; the product/ brand seeks a locus in the space through positioning. While positioning a brand, the firm has reckon competitors-especially the leaders Positioning.

Main Concerns in Positioning

Positioning

is not Over at one stroke; it has to be monitored and adapted. Product positioning and value proposition

Avenues for positioning are Many

Positioning viz- a viz competition, its performance gap Positioning on the consumers expectations and desires. Positioning on the plank of quality, price and service. Positioning on the product conformity with social demands In fact, a product offer can be positioned on any factor existing or emerging, which is of importance to the target marget.

Product Positioning and Brand Positioning

Example

of Maruti Omni

Issues in Product Positioning

Where is the new offer going to compete? As what? Which product function/customer need is it trying to meet. What other product categories serve this need? Where is the real gap, where is such a new offer most welcome and wanted by the market? What are the companies competencies to fight here?

Issues in Brand Positioning