Download Subject : Apparel Marketing Unit 2: Introduction to fashion marketing

Subject : Apparel Marketing
Unit 2: Introduction to fashion marketing
Quadrant 1 – E-Text
Learning Objectives
The learning objectives of this unit are to:
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Define marketing, market, need, want, demand, value, satisfaction.
Differentiate between various philosophies of Marketing.
List components of Marketing.
Detail the process of Fashion Marketing.
Review and appreciate latest developments in Fashion Marketing.
2.1 Definitions
Marketing is a social and managerial process by which individuals and groups (organizations)
obtain what they need and want through creating and exchanging value with others - By Philip
Kotler.
It’s a process by which companies create value for customers and build strong customer
relationships in order to capture value from customers in return.
The definition when analyzed deals marketing as both social (where the traditional way of
transaction and exchange through social groups takes place) and managerial ( where modern way
of dealing through organizational structure and methods takes place). It deals how individual
(Haute couture, Designer wear) and groups (Pret, bridge, street wear) segments are to be targeted
and positioned. The definition lays emphasis that without need and want there is no demand and
hence no marketing. It lays emphasis that without marketers creating and delivering value there
will not be any purchase, hence no exchange. Let us understand the important terms in the
definition:
Market: The traditional definition says it’s a place where buyers and sellers meet. In today’s
context it can be virtual. The set of all actual and potential buyers of a product or service.
Need: States of felt deprivation
Want: The form human needs take as shaped by culture and individual personality.
Demand: Human wants that are backed by purchasing power.
Customer perceived Value: The customer’s evaluation of the difference between all the costs
of a market offering relative to those of competing offers.
Customer Satisfaction: The extent to which a product’s perceived performance matches a
buyer’s expectations.
2.2 Various Philosophies of Marketing
Normally the moment anybody talks of the term marketing people remember and think about how
people sell on the street, traffic signals and door to door selling. But those are desperate
measures and one method of selling. The evolution of marketing has history and it is a
philosophy by itself. Let us examine the evolution of the concept.
1. Production Concept: The idea is that consumers will favor products that are available and
highly affordable and that the organization should therefore focus on improving the production
and distribution efficiency.
2. Product Concept: The idea is that consumers will favor products that offer the most quality,
performance, and features and that the organization should therefore devote its energy to making
continuous product improvements.
3. Selling Concept: The idea is that consumers will not buy enough of the form’s products
unless it undertakes a large-scale selling and promotional effort.
This is the concept normally which comes to our mind when we talk of marketing. But beyond a
point it cannot market a product because consumers don’t buy a product because marketers are
offering a product. They will buy only when there is a need and a suitable product and other mix
are also offered. Hence the need for an effective, practical approach is needed, which
necessitated the next concept.
4. Marketing Concept: The marketing management philosophy is that achieving organizational
goals depends on knowing the needs and wants of target markets and delivering the desired
satisfactions better than competitors do.
Selling and Marketing Contrasted
Starting Point
Focus
Means
Ends
The selling concept
Factory
Existing Products
Selling and Promoting
Profits through sales
Volume
The Marketing Concept
Market
Customer needs
Integrated Marketing
Profits through
Customer satisfaction
Societal marketing Concept:- A principle of enlightened marketing that holds is that a company
should make good marketing decisions by considering the consumers’ wants, company’s
requirements, Consumers’ long-run interests, and society’s long- run interests. As we see it has
three considerations:
Society (Human Welfare), Consumers (Want Satisfaction), Company (Profits).
Today many companies follow this concept because mature consumers buy products or services
from a company which has a concern for society in which they live and contribute to it. Even
Governments (e.g. Indian Government) encourages the companies to spend some part of profit
on the society itself through CSR (Corporate social Responsibility).
2.3 Components of Marketing
The major tools or components of marketing are Four P’s, also called as Marketing Mix, are
important for the success of Marketing. Though there are various views on number of
components or tools like 4,5,7 P’s, we will follow Philip Kotler’s model of 4 P’s. The other P’s
which are mentioned by other authors on Marketing like people, process are dealt by Philip
Kotler in personal selling, Customers and STP as the core of process and managing of marketing
effort as part of Strategy.
Philip Kotler defines Marketing mix as” The set of Controllable tactical marketing tools Product, Price, Place, Promotion - that the firm blends to produce the response it wants in the
target market”.
Let us discuss in brief these components
Product: Goods and Service combination that marketers offer to the target market.
The products in apparel include Natural, Manmade; Outer& Inner wear; Tops, Bottoms; Men’s,
Women’s and Children’s wear; Formal ,Casual, Semi Formal wears; Custom Made,
Readymade; Accessories etc.
For a fashion Customer, product includes Design, Variety (Assortment), Quality, Features, Sizes,
Brand Name, Packaging, Services, Warranties, Returns etc.
Price: Amount of Money customers paying to obtain the product.
It includes List Price, M.R.P (Maximum Retail Price), Discounts, Allowances, Payment Period,
Credit terms etc.
Distribution/Place: The activities that make the product available to target customers.
It includes channels of distribution, Coverage, Assortments, Locations, Inventory,
Transportation, Logistics etc.
Promotion: Activities that communicate the merits of Product/Service and persuade target
customers to buy it.
It includes Advertising, Personal Selling, Sales promotion, Publicity, Public Relations, for
fashion Promotion. We can include also Visual Merchandising, Fashion Shows, In-store
Communication as additional tools of Promotion.
Customer: In marketing, as Gandhiji equated customer to a VIP, the very purpose and existence
of the company depends on the customer. As we know in Mass distribution customer is not one
and alone, but many. Their needs, wants and expectations differ. There are 7 billion population
in the world and as many types of customers. Hence marketer must divide the total market,
choose the best segment and design strategies so that the customers are given better value and
satisfaction than by the other competitors. In order to identify our company product/ customers
we have to understand the concept of Segmentation (dividing the market based on bases like
Geographic, Demographic, Psychographic, Behavioral etc.) then targeting them and positioning
(How to put it in the minds of Customers).
Core Concepts of Marketing
Target Markets & Segmentation
Needs, Wants, and Demands
Product or Offering
Value and Satisfaction
Exchange and Transactions
Relationships and Networks
Marketing Channels
Supply Chain
Competition
Marketing Environment
The core concepts are must with out which there is no successful marketing. As we want to
market, the first question that arises is to whom to market i.e. which segments and target markets
we have to serve. Having decided we have to answer the next question what will we serve. It
depends on what need, want and demand are there so that accordingly we can offer a product or
service .No customer buys any product if he is not getting value and satisfaction. Having a
product with value is one thing and facilitating exchange and transaction of it is another thing
which a successful marketer accomplishes.
For example, if a middle class young south Indian(Target) is feeling hungry(Need) and wants
south Indian food(Want) we can serve idly , dosa etc(Product). Fresh, hot tasteful idly at an
affordable price at his door step facilitates exchange and transaction and gives value as well
satisfaction.
In marketing concept, if you want to be continuously in business take continuous feedback
through relationships networks and thus the process will keep us to survive in the long run. By
developing superior, new innovative marketing channels and supply chain we can excel in
business and surpass the competitors. By bench marking , managing competition and surpassing
competition Marketers can be successful.
Hence Understanding the core concepts help Marketers to overcome any hurdles.
2.4 Process of Marketing
Having understood the concepts we have to study how marketing goal of satisfying customers’
needs and wants is achieved. It is achieved through Marketing process which will understand the
environment and opportunities first and then selects the target market.
The marketing mix i.e. Product, Price, Promotion, Place are developed and delivered through
managing the marketing process. The following diagram of Philip Kotler (Principles of
Marketing) depicts it very well.
Factors Influencing Company
Marketing Marketing Strategy
intermediaries
Demographic/
economic
environment
Technical/
physical
environment
Product
Suppliers
Place
Target Price
customers
Publics
Promotion
Social/
cultural
environment
Political/
legal
environment
Competitors
Internet Marketing
Also known as online Marketing. It helps in:
 Promoting a brand, products or services over the Internet.
 Involves email marketing, electronic customer relationship management and promotional
activities via wireless media.
 Combines the technical and creative aspects of the World Wide Web such as advertising,
designing, development and sales.
Types of Online Marketing
Affiliate Marketing, Display Advertising, Email Marketing, Inbound Marketing, Search Engine
Marketing, Search Engine Optimization, Social Media Marketing.
Upcoming Trends
Content Marketing, Image Centric Marketing, Advertisement Retargeting, Social Media
Marketing, Simple is More.
Relationship Marketing
Definition: According to Philip Kotler “Relationship Marketing has the aim to build mutually
satisfying long term relationship with key parties in order to earn and retain their business.”
Basic Concept: Relationship marketing basically refers to Development, growth, and
maintenance of long-term, cost-effective relationships with individual customers, suppliers,
employees, and other partners for mutual benefit.
What is it all about ?
In RM Firms build long-term relationships in four ways:
1.
2.
3.
4.
Gather information about their customers
Analyze the data and use it to modify the marketing mix
Monitor interactions with customers
Use customers’ preferences and knowledge
Major Features / Characteristics:
1.
2.
3.
4.
5.
6.
7.
8.
Focuses on long term rather than short term relationships.
Emphasizes retaining customers over making a sale
Ranks customer service as a high priority
Encourages frequent customer contact
Fosters customer commitment with the firm.
Bases customer interactions on cooperation and trust
Views customers as equal partners in transactions.
Encourages long-term relationships and repeat purchases.
Levels of RM
Basic Marketing: Here the salesperson sells to the final customers. This is also known as direct
sales.
Reactive Marketing: Here the salesperson sells the product and encourages the customer to call
for any comments or enquiries.
Accountable Marketing: The salesperson calls the customers to ensure whether the product is
working as per satisfaction and if there is any problem in the product. Furthermore he also asks
the customer for any suggestions/feedback to improve the service/product. Thus, he is taking
responsibility for the sales.
Proactive Marketing: The company works continuously with its large customers to help
improve performance. This is specially seen in financial companies wherein the movement in the
financial market induces the company to make changes regularly. However at the same time,
these financial companies have to take care of their customers as well. Thus they take regular
feedbacks from their large customers thereby developing their products accordingly.
Partnership Marketing: The company works continuously with its large customers to improve
its performance.
Ten Critical Players In RM: Suppliers, Distributors, End users ,Employees, Financial Firms,
Government, Media, Allies, Competitors, General public.
Why RM is Important?
It costs five times as much to attract a new customer as it does to keep a current one satisfied.
Viral Marketing
It is also known as word of Mouth Marketing.
Marketing phenomenon that facilitates and encourages people to pass along a marketing
message.
Viral marketing depends on a high pass-along rate from person to person. If a large percentage of
recipients forward something to a large number of friends, the overall growth snowballs very
quickly.
Elements of Viral Marketing
An effective viral marketing strategy:
Gives away products or services. Provides for effortless transfer to others. Scales easily from
small to very large. Exploits common motivations and behaviors. Utilizes existing
communication networks. Takes advantage of others’ resources.
Advantages of Viral Marketing
An Enhanced Customer List. Remarkable Growth in Comparatively Lesser Time. You Gain
More Credibility. You Gain More Credibility. Cuts your Promotional Costs.
Disadvantages of Viral Marketing
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Uncontrollable
Hard to Measure
Association with unknown groups
Spam threats
Keep away from making merely financial-based offer
Network Marketing
Network Marketing business model is the one in which a distributor network is needed to build
the business. Usually such businesses are also multilevel marketing in nature in that pay outs
occur at more than one level.
Network Marketing is a strategy in which the sales force is compensated not only for sales they
personally generate, but also for the sales of the other salespeople that they recruit. This recruited
sales force is referred to as the participant's "downline", and can provide multiple levels of
compensation. Other terms used for Network Marketing include pyramid selling, multi-level
marketing and referral marketing.
Network marketing is a type of business opportunity that is very popular with people looking for
part-time, flexible businesses. Some of the best-known companies in America, including Avon,
Mary Kay Cosmetics and Tupperware, fall under the network marketing umbrella.
Network marketing programs feature a low upfront investment--usually only a few Thousands of
Rupees for the purchase of a product sample kit--and the opportunity to sell a product line
directly to friend, family and other personal contacts. Most network marketing programs also ask
participants to recruit other sales representatives. The recruits constitute a Representative
"downline," and their sales generate income for those above them in the program.
This societal marketing concept is one of the most successful strategy among many
neighbourhood Auntys and uncles who sell Saries, Home Furnishings and Garments near our
homes. Even big companies like saree and fashion stores are using promoters, even auto & taxi
drivers to introduce or bring customers and pay them commissions.
2.5 Conclusion
To summarize, in this unit you have been introduced to the different philosophies of marketing,
examined the components and nuances of marketing and understood its synthesis and application
to fashion marketing.