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# Evolution of marketing
The word marketing : originates from
the Latin word Mercatus meaning to
trade .
Webster dictionary defines a market as
a meeting together of people for the
purpose of trade by private purchase /
sale and subsequent use. It defines
marketing as the act or process of
selling or purchasing in a market.
# Evolution of marketing..
According to Philip Kotler, the
marketing guru, a market comprises
all potential customers sharing a
particular need or want who might be
willing and able to satisfy that need or
want for a mutually agreed
consideration
# Evolution of market.
The evolution of market occurred alongside
evolution of civilization.
In the beginning of human history, society was
self-sufficient with very few wants.
Each family was an independent unit of
production and consumption.
Since each family unit produced only what was
required for their consumption, there were no
surpluses.
Since there were no surpluses the need for the
creation of a market was not felt by anybody.
# Evolution of market..
With the passage of time, commercial activity
made its appearance in the lives of the people.
At this juncture, a need was felt for the creation
of exchanges for buying and selling of goods
and services or a market. For ex :
--if 10 families produce 10 different products,
several trips needed to exchange their goods
with each other.
If they lived far away from each other, the
difficulties became even more acute.
The idea of a market at a central location,
meeting on certain dates was born
# Evolution of market..
In early civilization religious and social
occasions were also converted into
occasions for exchange of goods.
With the introduction of Christianity into
Europe, the practice of converting such
festivals into fairs as well came into being.
(Fairs are conducted even today. Such as
Industry trade fairs). Certain fairs have
attained world wide fame (Ex. The Kumbh
mela
# Evolution of market
The medium of exchange was through
barter.
In barter system, goods are exchanged
for other goods.
Possible only in a simple economy. As
economy developed, deficiencies in the
system became apparent. They were:
-- The need to synchronize needs.Forex:
-- If a carpenter wants shoes but has only
a table to offer, then he has to find a
cobbler who also needs a table and is
willing to give shoes in exchange.
# Evolution of market
A standard measure of value was absent.
--Two persons who wanted each others goods could
not arrive at an equitable price. In such a situation,
one party was bound to suffer.
Indivisibility of commodities was a handicap because
of loss in value if commodities are divided. For ex :
-- If a man wanted cloth for half the value of his
buffalo and other goods for rest of its value , he
cannot divide the buffalo without completely
destroying its value.
impracticality of storing wealth in the form of
commodities
-- As many commodities are perishable.
# Evolution of market :
The invention of money completely
eliminated the above deficiencies
.Difficult to say how old the term money, is.
During the period of the Crusades banking
notes were issued by Knights of the templar to
pilgrims in exchange for gold .
In India , paper money in the modern sense
made its appearance in the late eighteenth
century with the issues of private banks as well
as semi government .
# Evolution of market :
Although money is the accepted medium of
exchange in the modern world , barter trade
does occur even now in unusual situations.
--- The food for oil programme introduced by
the United Nations in respect of Iraq is a recent
example.
--- Also resorted to by countries whose
economy is in shambles with a high inflation
rate and insufficient foreign exchange. For
ex ;Nigeria got into barter in mid 1980s in a
similar situation.
# Segmentation of markets :
On the basis of the way the business of exchange
of goods and services is conducted in terms of the
number units handled per exchange such as a
wholesale market and a retail market.
On the basis of type of goods sold
# Commodity market in which different kind of
commodities are sold exclusively in that market.
# Capital markets dealing with money, foreign
exchange , Stock market etc.
On the basis of Government regulations :
# Such as stock market or a financial market dealing
with IPOs is regulated
On the basis of the nature of the transaction :
# Such as the spot market , futures market , options
market etc
# NATURE OF MARKETING..
# What is a Bank ?
Financial institution which accepts deposits &
lends such money in the form of advances.
# Two major functions :
--- Basic (core) & Ancillary :
--- Basic Functions :
Deposit mobilization & lending are basic
functions.
Deposit (for a customer) is a liability for the bank
Its lending, however, forms its asset base.
Lending for individual & business needs.
# Types of Banks :
Commercial Banks:
-- Scheduled Banks :
-- PSBs and
-- other Indian banks
-- Non-scheduled Banks :
-- Foreign Banks and
-- RRBs (Regional Rural Banks )
NBFCs
Investment Banks
New Generation Banks.
# Types of Deposits
Time Deposit
Fixed Deposit
Recurring Deposit
Demand Deposit
Savings Bank
Current Account
Major difference lies in interest rates and
duration of withdrawal / transaction
# Marketing tools :
--- ABC Analysis :
The Pareto principle (also known as the 80-20
rule )
For many events, roughly 80% of the effects
come from 20% of the causes.
Business management thinker Joseph M Juran
suggested the principle and named it after
Italian economist Vilfred Pareto
-- He observed in 1906 that 80% of the land in
Italy was owned by 20% of the population;
In business normally "80% of your sales come
from 20% of your clients."
# Marketing tools
--- XYZ analysis :
Used normally in relation to the customer
demand .
X is high demand,
Y medium demand,
Z very low or sporadic demand.
--- VED ( Vital, Essential, Desirable)
Used in inventory control , FG mgmt , Mgmt of
accounts in banks
# Letter of Credit :
Is a document issued by a Bank to a beneficiary
guaranteeing payment for facilitating trade.
-- An Example :
Company A in India imports garments from
Company B in England.
A approaches his bankers SBI to open an LC in
favor of B in England.
SBI opens the LC and advises the LC to B
through SBI , London.
A is the opener, SBI India is the issuing bank
SBI London is the advising bank and B is the
beneficiary.
# Consignor :
The sender of goods .
# Consignee :
Receiver of goods.
# Indemnity :
Security against losses/damage.
-- Ex : By a vendor to a customer
-- by a beneficiary of an LC to the settling
bank
# Invisible trade :
Non merchandise trade like transport, banking,
insurance etc.
# Inflation rate or cost escalation coverage :
An agreed formulae to protect a vendor against
manufacturing cost escalations particularly in
respect of long delivery items.
# Third party bailees :
Intermediaries involved in a transaction
between a consignor& consignees
For Ex :Transporters ,Shipping companies
# Sellers Beware :
The seller accepts responsibility prior to
the sale and is liable to the buyer for any
deviations from the specifications stated in
the written sales contract.
# Buyers Beware :
Buyer buys on an as is where is basis
Buyer accepts the risk of the product
being either defective or unsuitable for his
or her needs.
# Ex-Works:
The buyer has to take delivery of the goods at
the factory gate.
# Free On Board (FOB) :
Normally used in international trade
Selling price includes cost of transportation and
loading charges onto a ship at a port in the
originating country is to sellers account.
# Cost,Insurance,Freight ( CIF ) :
Selling price includes all costs incurred for
reaching the goods to any port in the
destination country.
# Railway Receipt ( RR )
Receipt issued by Indian Railways to a
customer as a token of their having
received goods for transportation by rail.
# Goods Receipt (GR) :
A receipt issued by an road transport
company to a customer who has given
goods for surface transport.