WHAT IS MARKETING

 Selling & Advertising are only the tip of the marketing.

 The marketing functions developed as the marketing
influence extended into different business sectors.
 It came into prominence in 1950s & 60s when the
countries have excess production capacity.
 Marketing spread more rapidly in consumer packaged
goods, consumer durables and industrial equipment.
 It has also attracted the interest of insurance & financial
service companies.
 Marketing of services present different challenges to the
marketing organisations.
 At the start of 21st century Marketing must be
understood not in the old sense of making sale by
“telling & selling”
 We live in the age of online one to one marketing,
tailoring product & services & working with the
customer.
 The marketing org that excels in understanding
consumer needs develops product that provide
superior value and then price, distribute &
communicate effectively & efficiently should find
their products & services very easily.
 Newer technologies present special challenges to the
marketing organisation for it brings them close to
global market.
 National borders are no longer a hurdle in the trade.
 We define Marketing as a social process by which
individuals & group obtain what they need & want
through creating & exchanging product & value
with others. To explain the same, we examine the
following terms
 Needs Wants & Demands
 Human needs are states of felt deprivation.
Human have many complex needs. They include
basic physical needs for food, clothing, warmth,
safety needs for belonging & affection, individual
needs for knowledge & expression.
 These needs are not invented by the marketrs.
These are the basic part of human makeup.
 People in less developed societies might try to
reduce their desire & satisfy them with what is
available.
 Wants are form taken by human needs as
they are shaped by culture & individual
personality.
 People have unlimited wants but limited
resources. When backed by buying power
becomes demand. The marketing org. go
a long way to understand the needs,
wants & demand of their target market.
A. H. Maslow Theory

knowledge
Self- actualization need
For self fulfillment

Esteem need
For self respect, reputation, status

Belonging & love need

For affection, acceptance etc.
Safety need
For security, protection, order
Physiological need
For food, shelter, clothes, warm
 In outstanding companies management stay
close to customer in an on going effort to
understand their needs & wants Disney (Mickey,
Minnie, Goofy)
 Product
 People satisfy their needs & wants with products.
A product is anything that can be offered to
market to satisfy a need & want. Usually product
suggests a physical product such as a car, a
soap. However, product is not limited to physical
objects. Any thing capable to satisfy a need can
be called a product. Person, place, orgnaisation,
activities and ideas.
 Value, Satisfaction & Quality
 Customer Value is the difference between the
values the customer gains from owing & using a
product and & cost of obtaining the product.
 Satisfaction depends on a product’s performance
in delivering value relative to buyer’s expectation.
 It is closely linked with the Total Quality Management
 Freedom from defects
 Quality as totality of features & characteristics of
a product that bears the ability to satisfy
customer needs. Quality begins with the
customer needs & ends with customer
satisfaction.
 Exchange, Transaction & Relationship
 Marketing occurs when people decide to satisfy
needs & wants through exchange. Exchange is
act of obtaining a desired object from someone
by offering something in return. Exchange is a
core concept of marketing. Several conditions
must be satisfied:- at least two parties, each
party must also want to deal with the other party,
each must be free to accept or reject the other’s
offer. Each party must communicate with each
other & deliver. Exchange creates value just as
production creates consumption.
 Transaction is marketing unit of
measurement. Transaction consists of a
trade of values between the two parties.
Transaction is in terms of monetary.
 Relationship Marketing involves creating,
maintaining & enhancing strong value
laden relationship with the customers &
other stakeholders. Beyond creating short
term transaction, marketers need to build
long term relationship with customers,
suppliers and distributors.
 Markets: The concept of exchange leads to
market. A market is a set of all actual &
potential buyers of a product. The size of
market depends on the number of people
who exhibit the need, have resources to
engage in exchange and are willing to
offer these resources in exchange for what
they want. Originally the term market
stood for the place where buyers & sellers
gathered to exchange their goods.
 Marketing Management:-
 We define Marketing Management as the
analysis, planning, implementation &
control of programs designed to create,
build & maintain beneficial exchange with
target buyers for the purpose of achieving
organisational objectives. Thus marketing
management involves managing demand,
which in turn involves managing customer
relationships.
 `
 Most people think that marketing management as
finding enough customers for the co’s current
output, but this is too limited view point. At any
point of time, there may be negative demand, no
demand, latent demand, declining demand,
irregular demand, full demand, overfull demand
and unwholesome demand.
 Marketing Management Philosophies
 The Production Concept
 The Product Concept
 The Selling Concept
 The Marketing Concept
 The Societal Marketing Concept
 Negative Demand: A market is in a state of negative demand if
a major part of the market dislikes the product and may even pay
a price to avoid it. People have a negative demand for
vaccinations, dental work and gall bladder operation. Employers
feel a negative demand for ex-convicts and alcoholic employees.
 No demand: Target consumers may be unaware of or
uninterested or indifferent to the product. Thus framers may not
be interested in the new and mechanical farming, students may
not be interested in undertaking the foreign languages.
 Latent Demand: Many consumers may share a strong need &
desire for something that can not be satisfied by any exiting
product. There is a strong latent demand for un-harmful
cigarettes, safer neighborhood, more fuel efficient cars, cure for
cancer
 Declining Demand: Every organization sooner or later, face
declining demand for one or more of its products
 Irregular Demand: Many organisations face demand that varies
on a seasonal, daily or even hourly basis, causing problems of idle
or overworked capacity. Museums are under visited etc.
 Full Demand: Organisation face full demand when they are
satisfied with their volume of business. Marketing task is to
maintain the current level of demand in the face of changing
consumers preferences and increasing competition. The marketing
organisation must maintain quality and continually measure
consumer satisfaction to make sure it is doing a good job.
 Overfull Demand: Some organisation face a demand level that is
higher than they want to handle. Thus a bridge might carry a
higher amount of traffic than is safe. The marketing task called
de-marketing requiring finding ways to reduce the demand
temporarily or permanently. General de-marketing seeks to
discourage overall demand and consists of such steps as raising
prices and reducing promotion ad service. Demarketing does not
aim to destroy demand but only reduce its level.
 Unwholesome demand: Unwholesome products will attract
organised efforts to discourage their cosumption. Unselling
campaigns have been conducted against cigarettes, alcohol, hard
drugs, handguns, large families.
 The Production Concept: The production is one of the oldest
concepts guiding the sellers. Consumer will favour those product
that are available & highly affordable. Focus is on improving
production & distribution efficiency. One of the oldest philosophies.
Still useful in two types of conditions demands exceeds supply or
when the product’s cost is too high & improved productivity is
needed to bring it down. When operating under production concept
the major risk is focusing too narrowly on their operations.
 Product Concept
Consumer will favour products that offer most quality, performance
& innovative features. Some believe that build a better mousetrap
the world will beat a path to their door. Buyers may be looking for
a better solution to a mouse trap. A better mouse trap will not sell
unless the manufacturer design, price it attractively place it in
convenient place for the buyers. Many of these managers are
caught in a love affair with their product and fail to appreciate that
may be less “turned on” and may even be moving in a different
direction. “Marketing Myopia” undue concentration on the product
rather than need. user needs train instead of transportation &
overlooked the challenges of airlines etc.
 The Selling Concept
Consumer will not buy enough of org’s product unless it undertakes large scale
selling & promotion effort. Here, we have to overcome the buying inertia and
coaxed the customer into buying. The concept is typically practiced with unsought
goods. Usually buyers do not think of buying insurance, coverage, encyclopedia
etc. benefits of the product are the core area for selling. Many firms practice the
selling concept when they have overcapacity. Thus marketing based on hard lines
carries high risks. It focus on creating sale transaction rather than on building long
term, profitable relationship with customers. Most of the assumption in this
concept are poor in nature about the buyer.
 The Marketing Concept
The marketing concept is a business philosophy that arose to challenge the
previous concepts. It’s central tenets did not fully crystallize fully until 1950s. The
marketing concept holds that the key to achieving organisational goals consists in
determining the needs & wants and delivering the desired satisfaction more
effectively and efficiently than competitors. The marketing concept expresses the
co’s commitment to the time honored concept in economic theory known as
“Consumer Sovereignty”. The determination of what is to be produced should not
be in the hands of companies or in government but in hands of consumers. To
respond to the customer need the organisation has to mold itself.
 JC Penny Motto” To do all in our power to pack
the customer’s dollar full of value, quality and
satisfaction”
 “To fly to serve” British Airways
 “You’re the boss” United Airlines
 Yes, we can” Radisson Hotel
 “Have it your way” Burger King
 Selling focus on the need of seller, marketing on
the needs of buyer.
 Selling is preoccupied with the seller’s need to
convert his product into cash
 marketing with the idea of satisfying the needs of
customer by means of a product and the whole
cluster of things associated with creating
delivering and finally consuming.
 Focus Means Ends

Profits
Products Selling &
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Promoting

Selling concept

Customer Integrated Profits thru

needs marketing Customer satisfaction

Marketing Concept
Evolving role of Marketing

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 Marketing is Advertising, Sales
Promotion and Publicity
 Marketing is smiling and a friendly
atmosphere
 Marketing is innovation
 Marketing is positioning
 Marketing is Analysis, Planning &
Control
 Marketing Challenges
in the 21st Century
 Marketing operates within a dynamic global
environment. Rapid changes can quickly make
yesterday’s winning strategies out of date.
 What are marketing challenges at the beginning of the
21st century. Today’s companies are wrestling with
changing customer values and orientation, market
maturity environmental decline, increased global
competition and host of other economic, political and
social problems. However, these problems also provide
marketing opportunities. Looking at different trends and
forces which are changing the marketing landscape.
 Growth of non-profit marketing
 Marketing has become a major component in the
strategies of many non profit organisations such
as colleges, hospitals, museums and now even
churches.
 Many private schools, universities are facing
declining enrolments, rising cost and global
competitors are using marketing to compete for
students and funds. They are defining target
markets, improving their communications and
promotions, responding better to students needs
& wants.
 Even govt agencies have shown increased
interest in marketing

 Rapid globalization
 During last 25 years economy has undergone
radical changes. Geographical and cultural
distances have shrunk with the advent of fast jet
airlines, fax machines, internet,
telephone/cellular links, digital satellite, TV
broadcasting and other technical advances.
 Almost every org large or small is touched in
some way by global competition.
 Companies like toyota, nestle, siemens,, sony are
facing tough competition of local manufacturers.
 Many goods and services are “ hybrids” with
design, material, purchases, manufacturing &
marketing taking places in several countries.

 Information technology & electronic
marketing
 Information revolution has reached a critical
mass where new information based
infrastructure is being developed, thru
convergence of telecommunication,
computer systems, softwares, info services
& media. This infrastructure is creating a
major shift in markets & competition. The IT
explosion is accelerating the rate of change
and emergence of new global competition. IT
has a profound impact on every industry in
the world.
 Changing world economy
 Large part of the world has grown poorer
during the past few decades. A sluggish
world economy has resulted in more
difficult times for both consumers &
marketing org. People’s need are greater
than ever, but lack means.
 Current economic conditions create
problems & opportunities for marketing org.
 Wal mart “we sell for less- always”,
 Satisfaction guaranteed.
 Callfor ethical behaviour & social
responsibility
 Social & environmental impact.

 The new marketing landscape

 Marketing operates within a dynamic
global environment. Peter Drucker, once
observed, a marketing organisation’s
winning formula for the last decade will
probably be its undoing in the next
decade.
 Today companies are facing the challenges
of changing customer values, market
maturity, environmental decline, increased
global competition & host of other
economic, political & social problems.