Sir Padampat Singhania University Principles of Marketing Subject

Sir Padampat Singhania University Principles of Marketing Subject: Introduction to Marketing Subject Code: BM 391 Credits : 5 -0 -0 -5 Branch: B. B. A Semester 5 Faculty : Dr Disha Mathur 1

Learning Outcomes Introduction Background of Marketing Evolution of Marketing role Definitions of Marketing Functions and scope of marketing Core Concepts of Marketing Management Orientations/ Philosophies Traditional to Modern Marketing Selling vs Marketing Challenges 2

Why Study Marketing? Plays an important role in society Vital to business survival, profits and growth Offers career opportunities Affects your life every day on various levels as a customer, as public , etc.

Background of Marketing Early humans had only basic requirements such as food and shelter They themselves obtained them collecting, growing and hunting. Therefore they were self- sufficient. Once the needs became more, the man could not obtain them on his own. Then he had to exchange for what he has with others. It was called the Barter System However, Barter system was not efficient. There were many problems with the barter system. E. g. Person could not easily find another person who had his need and who wanted his surplus. Then came the introduction of medium of exchange

Continued. . The birth of selling goods and services started with the use of money as a medium of exchange. People started producing more items than that they want and sold them in the market for money and obtained their other requirements from the money they received, That gave birth to MARKETS. Markets are places where customers and suppliers met. They were geographical places. It was a pre-planned place at a preplanned time to exchange goods.

Markets The excess items were sold in the market and that made markets very competitive The number of Sellers also grew in time such that consumers started to have much choice. After some time the producers could not handle selling effectively. There were problems of sharing time for production and selling and many other practical problems. As a results specialist sellers were born. They are called the MIDDLEMEN

Continued. . The focus shifted to sales, retaining customers and finding new customers Selling could not be done well without really understanding the needs and wants of customers Therefore customers became all the more important A customer oriented approach had to be used That paved the way to form businesses as Marketing Organizations

It Is Important to note that: Marketing is not only used by commercial profit oriented organisations but also by other organizations such as temples, churches and many other not for profit organizations and persons. For example : Temple/Church provide their service (product) to its congregation(customer) It announcers its activities (promotion) to its congregation (target market). It depends on funds of congregation ( price/payment) for its survival. Further it is located where their congregation can have easy access ( place). Therefore customer would be the most important element of any marketing organization. Marketer needs to strive to satisfy its customers as “No customers means No business” 8

A Market System The set of all actual and potential buyers of a product or service Communication Industry (a collection of sellers) Products / Services Money Information A simple marketing system 9 Market (a collection of buyers)

Main actors and forces in a modern marketing system Competitors Marketing intermediaries Suppliers Company (marketer) 10 End user market

Evolution of marketing Role

What is Marketing? Marketing is the delivery of customer satisfaction at a profit. “Meeting Needs Profitably” 12

The Goal of Marketing is: To attract new customer by promising superior value, and To keep current customers by delivering satisfaction. 13

Marketing Defined Marketing is Selling No, because: Selling is part of Marketing starts long before the company has a product or service Marketing involves homework to asses needs, measure their extent, and determine if a profitable opportunity exists Selling only occurs only after a product is manufactured or a service is created Marketing continues throughout a product’s life, finding new customers, improving product appeal and performance, and managing repeat sales Philip Kotler “On Marketing” 14

Definitions “Marketing is a managerial and societal process by which individuals and groups obtain what they need and want through creating, offering and freely exchanging products and services of value with others. Philip Kotler( The Millennium Edition – 2000) 15

Marketing Management is. . “Marketing Management is the process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods and services to create exchanges that satisfy individual and organisational goals” American Marketing Association 16

Functions/Tasks of Marketing 17 Marketers act as the customers’ voice within the firm and marketers are responsible for many more decisions than just advertising or sales: Analyse industries to identify emerging trends/ Assessing opportunities. Determine which national and international markets to enter or exit/ Identifying markets to enter. Conduct research to understand consumer behavior. Design integrated marketing mixes – products, prices, channels of distribution, and promotion programs.

Scope of Marketing Places: India , Goa, Malaysia � Properties: real estate, farm houses, etc � Organizations: hospitals, educational institutes, etc � Goods: pen car, etc � Services: doctors, CAs, Teachers � Experiences : Theme parks, amusement parks, movies. � Information: Google, wiki, etc � Ideas: Interior decorator, vastu , etc � Events: New years party, award shows. � Persons: actors, sportsmen, politicians, etc. 18

Understanding Marketing definition To explain marketing definition, we examine the following important terms : Needs, wants, and demands Products and services Value, satisfaction and quality Exchange, transactions, and relationships Markets 19

Core Marketing Concepts 20

Needs, Wants, and Demands Needs: The most basic concept underlying marketing is that of human needs. Human needs are states of felt deprivation. Human have many complex needs: Physical needs for food, clothing, warmth, and safety Social needs or belonging and affection Individual needs for knowledge and self – expression Wants: Want are the form taken by human needs as they are shaped by culture and individual personality. They are specific. People have almost unlimited wants but limited resources. Demands: When backed by buying power, wants become demands. 21

Products and Services Product: Anything that can be offered to a market to satisfy a need or want. The concept of product is not limited to physical objects – anything capable of satisfying a need can be called a product. However, these are largely tangible, material offerings. Services: In addition to tangible goods, products also include services, which are activities or benefits offered for sale that are essentially intangible and do not result in the ownership of anything. These cannot be touched and stored. 22

Values, Satisfaction, and Quality 23 Values: Customer value is the difference between the values the customer gains from owning and using a product and the costs of obtaining the products. Payment- received Satisfaction: Customer satisfaction depends on a product’s perceived performance in delivering value relative to a buyer’s expectation. If the product’s performance falls short of the customer’s expectations, the buyer is dissatisfied. Quality: Customer satisfaction is closely linked to quality. Quality has a direct impact on product performance. Quality can be defined as “freedom from defects”.

Exchange, Transactions, and Relationships Exchange : The act of obtaining a desired object from someone by offering something in return Transaction : A trade between two parties that involves at least two things of value, agreed – upon conditions a time of agreement, and a place of agreement. Relationship marketing : The process of creating, maintaining, and enhancing strong, value – laden relationships with customers and other stakeholders 24

MARKETING MANAGEMENT PHILOSOPHIES The role that marketing plays within a company varies according to the overall strategy and philosophy of each firm. There are five alternative concepts under which organizations conduct their marketing activities: ØProduction concept ØProduct concept ØSelling concept ØMarketing concept ØSocietal marketing concepts 25

Company Orientations Towards Marketing

Production Concept The philosophy that consumers will favour products that are available and highly affordable and that management should therefore focus on improving production and distribution efficiency. 27

Product Concept The philosophy that consumers will favour products that offer the most quality, performance, and innovative features. 28

Selling Concept The idea that consumers will not buy enough of the organization’s products unless the organization undertakes a large – scale selling and promotion effort. 29

Marketing Concept enunciates: The idea that the social and economic justification for an organization’s existence is the satisfaction of customer wants and needs while meeting organizational objectives. 31

Key Components of the Marketing Concept achieving organizational goals consists in determining the needs and wants of target market and delivering the desired satisfaction more effectively than competitors Customer Orientation Corporate activities Are focused on Customer satisfaction Integrated Effort All staff should accept The responsibility of Creating customer satisfaction Goal Achievement The belief that corporate goals can be achieved Through customer Satisfaction

Marketing Management Orientations- Selling vs Marketing Production concept Product Concept Selling concept Marketing Concept Societal Marketing Concept

Societal Marketing Concept The idea that the organization should determine the needs, wants, and interests of target markets and deliver the desired satisfactions more effectively and efficiently than competitors in a way that maintains or improves the consumer’s and society’s well – being. 34

Three Considerations Underlying The Societal Marketing Society (Human welfare) Societal marketing concept 35 ü Less toxic products ü More durable products ü Products with reusable or recyclable materials Consumers Company (Want satisfaction) (Profits)

Marketing Myopia First introduced -Theodore Levitt Narrow minded approach: Here the 36 marketer wants to sell the product and services, without much focusing on the customer demands/needs Also known as marketing short sightedness. It is a type of distorted vision about the organisation. Focus on product rather than customer Mass production

Review: Marketing Management Philosophies Orientation Focus Production What can we make or do best? Sales How can we sell more aggressively? Marketing What do customers want and need? Societal What do customers want and need, and how can we benefit society?

Marketing Process A marketing process include all the steps and activities in the that a marketing department administers to reach its objectives. The marketing process include the following activities: 1. Analyzing marketing opportunities and developing the organization’s mission and objectives. Can be done by SWOT analysis (strengths, weaknesses, opportunities, threats). 2. Selecting target markets. 3. Developing the marketing strategy by developing marketing mix (4 P’s). Ø Product , Price, Promotion, and Place. 4. Managing the marketing effort. Ø Include analysis, planning, implementation, and

Preparing an Integrated Marketing Plan and Program Price Place Promotion Product

MARKETING CHALLENGES INTO THE NEW CENTURY Growth of Non-Profit Marketing The Information Technology boom Rapid Globalization The changing World Economy The call for more Ethics and Social responsibility 40

THE NEW MARKETING LANDSCAPE The past decade taught business firms everywhere a humbling lesson. Domestic companies learned that they can no longer ignore global markets and competitors. Successful firms in mature industries learned that they cannot overlook emerging markets, technologies, and management approaches. Companies of every sort learned that they cannot remain inwardly focused, ignoring the needs of customers and their environment. 41

References: References Kotler, P. , Keller, K. , Koshy, A. , Jha, M. (2007) Marketing Management: A south Asian Perspective, (12 th ed. ) Pearsons Education. Kotler, P. , (1998), Marketing Management - analysis implementation and control, (9 th ed. ), Prentice Hall. planning Kotler, P. & Keller, K. 2011. Marketing Management 14 th Edition, Upper Saddle River, NJ, Prentice Hall. Kotler, P. , Armstrong, G. , Saunders, J. and Wong, V. , (2001), Principles of Marketing, (Third European Edition), Prentice Hall, Harlow Kotler, P. and Armstrong, G. (1997) Marketing An Introduction. Fourth Edition. New Jersey. Prentince Hall International 42