Download Definitions of marketing

Definitions of marketing
‘Marketing is the management process that
identifies, anticipates and satisfies customer
requirements profitably’
The Chartered Institute of Marketing
‘The right product, in the right place,
at the right time, and at the right
price’
Adcock et al
‘Marketing is a social and
managerial process by which
individuals and groups obtain what
they want and need through
creating, offering and exchanging
products of value with others’
Kotler 1991
Implications of marketing
• Who are our existing / potential customers?
• What are their current / future needs?
• How can we satisfy these needs?
• Can we offer a product/ service that the customer
would value?
• Can we communicate with our customers?
• Can we deliver a competitive product of service?
• Why should customers buy from us?
The marketing concept
• choosing and targeting appropriate
customers
• positioning your offering
• interacting with those customers
• controlling the marketing effort
• continuity of performance
Marketing management process
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Analysis/Audit - where are we now?
Objectives - where do we want to be?
Strategies - which way is best?
Tactics - how do we get there?
(Implementation - Getting there!)
Control - Ensuring arrival
Why is marketing planning necessary?
• Systematic futuristic thinking by management
• better co-ordination of a company’s efforts
• development of performance standards for
control
• sharpening of objectives and policies
• better prepare for sudden developments
The scope of marketing
• Marketing is typically seen as the task of
creating,promoting,and delivering goods and
services to consumers and businesses
• Marketers are skilled in stimulating demand
for a companys products
• Marketing managers seek to influence the
level,timing,and composition of demand to
meet the organisations objectives
• GOODS-Physical goods constitute the bulk of most
countries production and marketing effort
• Not only do companies market their goods
even,using the internet even individuals do it
• Services-As economies advance a growing
proportion of their activities is focussed on
production of services
• Services include the work of airlines,hotels,car
rentals,barbers or beautitians as well as
professionals
• Experiences- By orchestrating several services
and goods a firm can create,stage and market
experiences
• Events-Marketers promote time based
events,company anniversaries,major trade
shows,sports shows and artistic performances
• There is an whole profession of meeting
planners who work outs the event perfectly
• Persons-Celerity marketing is a major business
these days
• Today every major icon be it a filmstar or a
professional has a PR manager
• Places-places , cities, states regions and whole
nations attract tourists,factories,company HQ
and new residents
• Place marketers include economic development
specialists,real estate agents,commercial
banks,local business asssociations and ad and Pr
agencies
• Properties- are intangible rights of ownership
of either real property or financial property
• Properties are bought and sold and this
requires marketing
• Organisations-Organisations actively work to
build a strong favourable image in the minds
of the target public
• Corporates and institutions spend money to
build up their identity and image
• Information-can be produced and marketed
like a product or service
• This is what is done by institutions provide to
the student community and corporates to the
public
• Ideas-Every market offering includes a basic
idea,where product and services are platforms
for delivering some idea or benefit
• Social marketers are busy promoting ideas as
“say no to drugs” or “exercise daily”
Core marketing concepts
• Target markets and segmentation- A marketer
can rarely satisfy everyone in the market
• Not everyone likes the same soft drink,hotel
room,restaurant,college and movie
• Therefore marketers start by dividing up the
market based on demographic,psychographic and
behavioural differences among buyers
• The marketer then decides which segments
present the greatest opportunity which are its
target markets
• Marketplace,marketspace and metamarketBusiness people often use the term market to
cover various groupings of customers
• They talk about the need market(the diet-seeking
market),product market(the shoemarket),demographic market(youth market) and
geographic market(the french market)
• They exchange the concept to cover other
markets such as voter markets,labour markets
and donor markets
• Marketplace is physical as one goes shopping
in a store,market space is digital
• Marketspace is digital as when one goes
shooping on the internet
• Metamarket is a cluster of complementary
products and services that are closely related
in the minds of consumers but are spread
across diverse set of industries
• Marketers and prospects-A marketer is
someone seeking a response
(attention,purchase,vote or donation) from
another party called the prospect
• If two parties are seeking to sell something to
each other we call them both marketers
• Needs,wants and demands- Needs are basic
human requirements like food,air,water,
clothing and shelter to survive
• The needs become wants when they are
directed to specific objects that might satisfy
the need
• Demands are wants for specific products
backed by ability to pay
• Marketers do not create needs,needs preexist
marketers,marketers with societial factors
influence wants
• Product,offering and brand- Companies address
needs by putting forth a value proposition,a set of
benefits they offer customers to satisfy their needs
• The intangible value proposition is made physical
by an offering which is a combination of
products,services, and experiences
• A brand is an offering from a known source,and a
brand name carries many associations in the minds
of people
• All companies strive to build a strong and
favourable brand image
• Value and satisfaction-The offering will be
successful if it delivers value and satisfaction
to the target buyer
• The buyer choses between different offerings
on the basis of which is perceived to deliver
the most value
• Value can be seen as primarly a combination
of quality,service and price(QSP),called the
customer value triad
• Value increases with quality and service and
decreases with price
• We can define value as a ratio between what
the customer gets and what he gives
• The benefits include functional benefits and
emotional benefits
• The costs include monetary costs,time
costs,energy costs and psychic costs
• Exchange and transactions- Exchange is only one
of the four ways in which a person can obtain a
product
• One can self-produce the product or service,one
can use force to get a product,or as in burglary or
can beg
• Exchange is the core concept of marketing,is the
concept of obtaining a desired product from
some one by offering something in return
• For exchange potential to exist five conditions are
to be satisfied
• There are at least two parties
• Each party has something of value to the other
party
• Each party is capable of communication and
delivery
• Each party is free to accept or reject the exchange
offer
• Each party believes it is appropriate or desirable to
deal with the other party
• Transaction is a trade of values between two or
more parties
• A barter transaction involves trading goods or
services for other goods or services
• A transaction involves several dimensions,at least
two things of value ,agreed upon conditions,a
time of agreement and place
• Transfer is when A gives to B and receives nothing
tangible in return,eg:gifts,subsidies and
charitable contributions
• Relationships and networks-Transaction marketing
is a part of larger idea called relationship marketing
• Relationship marketing has the aim of building
mutually satisfying long term relations with key
parties- customers, suppliers,distributors in order to
retain their business
• Marketing network consists of company and its
supporting stake holders with whom it has built
mutually profitable business relationships
• Marketing channels-To reach a target market,the
marketer uses three kinds of marketing channels
• Communication channels deliver and receive
message from target buyers
• The marketer uses distribution channels to
display,sell or deliver the physical products or
services to the buyer or user
• The marketer also uses service channels to carry
out transactions with potential buyers like ware
houses,transport cos. and banks
• Supply chain-When marketing channels
connect the marketer to the target buyers,the
supply chain describes a longer channel from
raw materials to components to final products
• The supply chain represents a value delivery
system
• When a company moves upstream or
downstream its aim is to capture a higher
percent of supply chain value
• Competition-includes all the actual and potential
rival offerings and substitutes that a buyer might
consider
• Brand competition offers similar products and
services
• Industry competition is from all payers in the
industry
• Form competition is from all manufactures that offer
the same service
• Generic competition is from any other organisation
whose product is a purchase option for a buyer
• Marketing environment• Task environment includes the immediate actors
involved in producing,distributing and promoting
the offering
• The broad environment consists of six
components;
demographic,economic,natural,technological,politi
cal-legal and socio-cultural environment
• These environments contain certain forces that
have a major impact on the actors in the task
envronment
• The marketers task is to build a marketing
program or plan to achieve the desired
objectives
• The marketing program consists of numerous
decisions on on the mix of marketing tools to
use
• The marketing mix is the set of marketing
tools the firm uses to pursue its marketing
objectives in the target market
•
Mc- carthy classified these tools in to 4
broad groups
• The 4 p’s are product,price,place and
promotion
• Robert Lauteburn suggests that sellers 4Ps
correspond to customers 4 cs
• 4 c’s are customer solution,customer
cost,convenienc e and communication
Marketing management philosophies
• Marketing activities should be carried out in a
well-thought philosophy of efficiency
effectiveness,and social responsibility
• Eg: Dexter corporation
• There are 6 competing concepts under which
organisations conduct marketing activities
• namely the production concept,product
concept,selling concept,marketing
concept,customer concept and societal marketing
concept
• The marketing concept- emerged in the mid50s and challenged the preceeding concepts
• Instead of a product-centered make and sell
philosophy,the shift is to a customer centered
sense and respond
• The job is not to find right customers for the
products but right products for customers
• The marketing concept holds that key in
achieving organisational goals
• It consists of the company being more
effective than competitors in creating
delivering and communicating superior value
• Theodore levitt of Harward drew a perceptive
contrast between selling and marketing
concepts mainly selling focusses on the needs
of the seller and marketing the consumer
• The marketing concepts rests on 4 pillars,
target market,customer needs,integrated
marketing and profitability
• Target market-Companies do best when they
choose their target markets
• They do this very carefully and prepare
tailored marketing programs
• Customer needs- A company can define its
target market but fail to understand the
customer needs eg:the marble like product
• Some customers have needs of which the are
not fully conscious or they cannot articulate
these needs or words require some clarity
• The needs of the customer should be
addressed with a solution not your offering
• Integrated marketing- When the companys
departments work together to serve the
customers interests its integrated marketing
• Not all employees in the organisation are
trained and motivated to work for the
customer
• Integrated marketing takes place at two levels
one at various marketing functions,next
marketing must be embraced by other depts
• Profitability- In the case of private firms,the
major objective is long term profitability
• In the case of non profit and public
organisations,its surviving and attracting
enough funds to perform useful work
• Private firms should not aim for profits as such
but rather to achieve profits as a consequence
of creating superior customer value
• The customer concept- Today many
companies are moving beyond the marketing
concept to the customer concept
• Companies practicing the marketing concept
work at the level of customer segments
• A growing number of todays companies are
now shaping separate offers,services and
messages to individual customers
• They collect information from the customers
past transactions,demographics,media and
distribution preferences
• They hope to achieve profitable growth
through capturing a larger share of customers
expenditures by building customer loyalty
• The advent of factory customization,
computers,internet and marketing software
makes it effective
• The societal marketing concept• There is a debate if marketing concept is an
appropriate philosophy in an age of
environmental deterioration
• There are also resource shortages,explosive
population growth,world hunger and poverty,
and neglected social services
• The marketing concepts sidesteps the potential
conflicts among consumer wants,consumer
interests and long-run societal welfare
• The fast food hamburger business an eg. of
unhealthy food creating environmental issues
• Situations like this enlarges the marketing
concept and those suggested are humanistic
marketing and ecological marketing
• The societal markets holds that the
organisations task is to cater to the interests
of the target market enhancing the consumer
and societys well being
How business and marketing are
changing
• Market place is changing radically as result of
major societal forces-technology,deregulation
• Customers-expect higher quality,service and
customization,internet supplements this
• Brand manufacturers- facing intense from
domestic and foregin brands,rising promotion
and shrinking margins also strong retailers
• Store based retailers-are suffering from
catalog houses,direct mails e-commerce etc
Company responses and adjustments
• Reengineering-From focussing on functional
departments,reorganising by key processes,
managed by a multidisciplined team
• Outsourcing-From making everything inside
the company to buying from outside if they
are cheaper and better and own brands
• Ecommerce-From attracting customers to
stores or sales people reaching them its
feasible to make available in the internet
• Benchmarking- from relying on self
improvement to understanding world class
performers and adopting best practices
• Aliances-From trying to win alone to network
of partner firms
• Partner suppliers-From using many suppliers
to using few but more reliable suppliers who
work close in a partnership relationship
• Market centered- From organising by products
to organising by market segments
• Global and local-From being local to being
both global and local called glocal
• Decentralised- From being managed at the top
to encouraging more initiative and
intrapreneurship at the local level
Marketer responses and adjustments
• Customer relationship marketing- From
focussing on transactions to build a long term
profitable customers,products and channels
• Customer life time value- From making profit
on each sale to making profits by managing
life time sale,lower price for longer periods
• Customer share- From a focus of gaining
market share to focus building customer share
• Target marketing- From selling to every one to
trying to be the best firm serving well defined
markets
• Target market is facilitaed by special interest
magazines,TV channels and internet news
groups
• Customization- From selling the same offer in
the same way,to customizing the offerings
• Customer database-From collecting sales data
to building rich data ware house of
information about preferences,purchases etc.
• Companies can apply data mining techniques
to discover new segments and trends
• Integrated marketing communications- From
heavy reliance on one communication tool
such as adv or sales force to several tools
• Channels as partners- From thinking of
channels as customers to treating them as
partners in delivering value to final customers
• Every employee a marketer- Instead of
marketing done only by the marketing,sales
and customer service to every employee doing
• Model based decision making- From basing
decisions on intuition or slim data to basing
decisions on models and facts