Ba5207 Marketing Management

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1. BA5207 MARKETING MANAGEMENT UNIT 1 2. UNIT I INTRODUCTION Marketing – Definitions - Conceptual frame work – Marketing environment : Internal and External -…
  • 2. UNIT I INTRODUCTION Marketing – Definitions - Conceptual frame work – Marketing environment : Internal and External - Marketing interface with other functional areas – Production, Finance, Human Relations Management, Information System. Marketing in global environment – Prospects and Challenges.
  • 3. Marketingconsistsofindividual& organizational activitiesthatfacilitate& expedite satisfying exchange relationships in a dynamic environment through the creation,distribution,promotion& pricingof goods.
  • 4. The Marketing Management Process Marketing Managementis theprocessofplanning, organising,implementing& controllingmarketingactivities to facilitate& expediteexchangeseffectively& efficiently. ANALYSIS Collect and analyse marketing Information (Environmental scanning) IMPLEMENTATION Resource allocation, organising, programmes MONITOR and CONTROL Outcomes Set standards and Measurements PLANNING Take decisions about which consumers to satisfy and the marketing mix
  • 5. What Is Marketed? Goods Services Events Experienc e Persons Places Properties Organizations Information Ideas
  • 6. Needs, Wants & Demand Need want demand
  • 7. Needs, Wants and Demands  Needs :-are the basic human requirements. Physiological needs, social needs, individual needs for fulfillment. Most basic concept underlying marketing  Wants : Desire shaped by culture and individual personality  Demands: Wants backed by purchasing power. Given their resources, people demand products with the benefits that give them the most satisfaction.
  • 8. Marketing Management Concepts *The orientations under which organisations may conduct their marketing activities namely: (i)Production Concept:Orgs that employ this concept assume that customers are only interested in the availability of products at lower prices.Managers of production oriented concentrate on achieving high production efficiency, low costs, and mass distribution such that marketing is not really necessary. (i)Selling Concept: Companies oriented towards selling focus on selling whatever they make -They assume that customers will resist or are reluctant to purchase products or services not essential to them and therefore employ creative advertising and aggressive sales people to overcome customer resistance/reluctance
  • 9. Marketing Management Concepts (iii)Product Concept: Premised or based on the belief that customers favour quality, performance or innovative featuresand will buy the high quality products if made available.
  • 10. Marketing Management Concepts (iv) Marketing Concept: Companies oriented towards the marketing concept firmly believe that the customer and the satisfaction of customer needs is key to organisational success. * Org places the customer needs at the heart of what it does and its activities are driven by the need to achieve the highest level of customer satisfaction *Pillars of the Marketing Concept  Customer Centricity Organisational Integration MutuallyProfitableExchange
  • 11.  (v) The Holistic Marketing Concept  The Holistic Marketing concept is based on the development, design and implementation of marketing programs, processes, and activities that recognizes their breadth and interdependencies.  Holistic marketing recognizes that “everything matters” in the marketing Marketing Management Concepts
  • 12. . Diagramof Holistic Marketing
  • 13. 1.Relationshipmarketing Relationship marketing includes of building mutual satisfaction with customers long term relationships with key parties as well as go through profit of the business. key parties are- • • • Customers-People those who are the target market for a firm. Channel - Suppliers, distributors Partner- Delears, agencies Relationship marketing involves cultivating the right kind of Relationship with right kind of groups. Outcomes of Relationship marketing is to create marketing network which consist of customers, employees, suppliers, distributors, retailer, agencies and soon.
  • 14. 2. Integratedmarketing  T h e marketer task is to device marketing activities and assemble fully integrated marketing programs to create , communicate anddeliver value for customers.  Marketing programs are the combination of decisions on value enhancing marketing activities to use.
  • 15. marketing mix/ integrated M.C. Carthy classified marketing into 4 tools
  • 16. RobertLauterborn suggestedthat the seller four P’scorrespontto the customers fourC’s Two key out comes of Integrated marketing are- •Many different marketing activities are employed to communicate and deliver value and •All corresponding activities are co-ordinated to maximize their joint effects
  • 17. 3. InternalMarketing • Internal Marketing is the task of hiring, training and motivating to able employees who want to serve customers well. • Intenal marketing must take place on two levels- • At one level think the various marketing function- » » » » » Sales forcing Advertising Customer service Product management Marketing researchand so on • Another level think about thecustomerswants, needs,demand and satisfaction.
  • 18. 4. SocialResponsibility Marketing • • Social Responsibility Marketing concept build socialand ethical consideration into theirmarketing parties Focus on satisfying customer needs and wants while enhancing individual and societal well-being Consider the collective needs of society as well as customer desires and the organization’sprofits.  Society..……#1(Human welfare)  Consumers ..#2 (Want satisfaction)  Company ….#3(Profits)
  • 19. Outcomesof HolisticMarketing • Clear understanding about business vision/values, mission, and goals/objectives. • Developing marketing strategies andplans. • Conducting marketing research. • Selecting target markets and connect with key customers. • Configuring products and services. • Making value ,price statements and shape market offerings. • Deliver value by exploration and creationof value • Creating promotional messages and integratingmedia. • Managing the salesforce. • Managing marketing/distribution partners. • Doing internal marketing. • Capture market insights and build strong Brand
  • 20. Marketing environment means the market situation/atmosphere within which a business enterprise has to operate. According to Philip Kotler, ―the company‘s marketing environment is made up of the sectors and forces outside the firm‘s marketing function which infringe upon the ability of marketing management to develop and maintain a successful relationship with the firm‘s target audience.‖ Marketing environment is the sum total of political, economic, social, technological and other forces which move around the business enterprise.
  • 22. 1.It creates an increased general awareness of environmental changes on the part of management 2.It guides with greater effectiveness in matters relating to Government. 3.It helps in Marketing Analysis 4.It suggests improvements in diversification and resource allocations 5.It helps firms to identify and capitalise upon opportunities rather than losing out to competitors. 6.It provides abase of ‗objective qualitative information‘ about the business environment that can subsequently be of value in designing the strategies. 7.It provides acontinuing broad-based education for executives in general, and the strategists in particular.
  • 24. External forces have considerable influence on company‘s marketing activities. They aredynamic, ever-changing and arelargely uncontrollable by management. 1. Demography 2. Economic Environment 3. Social & Cultural Environment 4. Political & Legal Forces 5. Technology 6. Ecology (Nature)
  • 25. Demographic analysis deals with quantitative elements such as age, gender, education, occupation, income, geographic concentration and dispersion, urban and rural population, etc. Thus, demography offers consumer profile, which is very necessary in market segmentation and determination of target markets. 1. Demography
  • 26. 1. Demography Good demographic analysis combines several factors such as population rate of growth or decrease, income or economic power, life-cycle analysis of consumer, occupation, education, and geographic segmentation. Quantitative aspect of consumer demand is provided by demography, e.g., census of population, whereas qualitative aspect of consumer demand such as personality, attitudes, motivation, perception, etc., is provided by behavioral analysis. Both demographic and behavioural analyses enable marketing executives to understand the bases of market segmentation and to determine marketing reaction to a new product or consumer reaction to an advertising campaign.
  • 27. People constitute only one element of a market. The second essential element of a market is purchasing power and willingness to spend. Then only we have effective demand. High economic growth assures higher level of employment and income, and this leads to marketing boom in many industries. Marketing plans and programmes are also influenced by many other economic factors such as interest rates, money supply, price level, consumer credit, etc. Higher interest rates adversely influence real- estate market and markets for consumer durables sold on instalment basis. 2. Economic Environment
  • 28. Social class is determined by income, occupation, location of residence of members. Broadly, we have three social classes i.e., upper, middle and lower and each class has its own standards with respect to lifestyle, behaviour, etc. Culture provides people with a sense of identify and Understanding of acceptable behaviour in a society. Example: In our country, the younger generation is moving ahead with the times, but the traditional population is not comfortable with the westernisation of our culture 3. Social &Cultural Environment
  • 29. There are three aspects of social and cultural environment i.e., 1. Changes in our life-styles and social values, e.g., changing role of women, emphasis on quality of goods instead of quantity of goods, greater preference to recreational activities and demand for readymade food, beauty parlor, etc., 2. Major social problems, e.g., concern for pollution of our environment, socially responsible marketing policies, need for safety in occupations and products, etc., 3. Social &Cultural Environment
  • 30. 3. Consumerism is becoming increasingly important to marketing decision process. Social environment in many countries is responsible for emphasizing social responsibility of business and customer-oriented marketing approach. Societal marketing concept, demanding not only consumer welfare but also citizen welfare, is due to the prevalent social environment and social or cultural values in many countries. Marketers are now called upon not only to deliver higher material standard of living, but also assure quality of life, i.e., environment free from pollution. 3. Social &CulturalEnvironment
  • 31. Political and legal forces are gaining considerable importance in marketing activities and operations of business enterprises. Marketing systems are affected by government‘s monetary and fiscal policies, import-export policies, customs duties. Legislation controlling physical environment, e.g., anti-pollution laws also influence marketing plans and policies. We have also legislation to control and regulate monopoly and unfair trade practices in many countries. Marketing Management cannot ignore the legislation regulating competition and protecting consumers. 4. Political &LegalForces
  • 32. Business enterprises may not be allowed to resort to price 4. Political &LegalForces  discrimination, false and misleading advertising, exclusive distributorships and tying agreements, deceptive sales promotion devices, division of markets, exclusion of newcompetitors, and such otherunfair trade practices. 
  • 33. 5. Technology The evolution of global market by 2001 has been due to the wonders of science and technology. It is the driving force behind many new product innovations and the development of many markets Electronic industry is the best example of exploiting new marketing opportunities. Digital watches killed the marketing prospects of traditional watches. Artificial fibre cloth has almost taken over the pure cotton textile industries in many countries. Television has adversely affected radio and cinema industries.
  • 34. Ecology, economic development, and market economy can go hand- in-hand. Sustainable development, environmental protection can be integrated to assure a healthy, peaceful, and productive life in harmony with Nature, our Earth- Goddess. Environmental experts are vigorously advocating the preservation and survival of our entire ecological systems. It is said that pollution is an inevitable by- product of high-consumption economic systems prevalent in the advanced countries. The marketing system of an enterprise has now to satisfy not only the buyers of its products (consumers/users) but also societal wants. 6. Ecology (Nature)
  • 35. Marketing Executives are expected to take measures to conserve and allocate our scarce resources properly. Above all, they must show active interest in the welfare of community life. Ecological crisis is a burning problem in the global economy. Fortunately marketers and business leaders of the world have come together under the UNO and WTO to bring about sustainable industrial and commercial development free from dangers of pollution and prevent further self- destructive and ruthless exploitation of nature. 6. Ecology (Nature)
  • 36. These are factors which are specific to the business concerned and include Consumers, Marketing intermediaries and Suppliers. 1. Consumers 2. Marketing Intermediaries 3. Suppliers 4. Competition
  • 37. The wants, desires, preferences, expectations and aspirations of consumers keep fluctuating. Marketing system must respond to the customer needs and desires in all aspects. Marketing policies, programmes and strategies areplanned, organised and executed with themain objective of customer satisfaction and service. Today, marketing in the firm begins and also ends with the customers. First, we have to identify customers, i.e., our markets. Then, we develop our marketing programme in the form of the appropriate marketing mix to reach our customers, i.e., our target market. Weoffer our output of goods and services primarily to secure continuous customer satisfaction. Repeat sales are possible onlyon customer satisfaction. 1. Consumers
  • 38. The wants, desires, preferences, expectations and aspirations of consumers keep fluctuating. Marketing system must respond to the customer needs and desires in all aspects. Marketing policies, programmes and strategies areplanned, organised and executed with themain objective of customer satisfaction and service. Today, marketing in the firm begins and also ends with the customers. First, we have to identify customers, i.e., our markets. Then, we develop our marketing programme in the form of the appropriate marketing mix to reach our customers, i.e., our target market. Weoffer our output of goods and services primarily to secure continuous customer satisfaction. Repeat sales are possible onlyon customer satisfaction. 2. Marketing Intermediaries
  • 39. The Company purchases raw materials from vendors/suppliers and it has to ensure regular supplies to maintain continuity of production. Shortage of raw materials can affect production volumes leading to low sales and low profits. Similarly increase in the prices of raw materials can affect sales volumes and profits. Therefore, suppliers play a major role in the profitable running of an organisation 3. Suppliers
  • 40. Although price competition is still present, particularly in the retail market, non-price competition is of paramount importance for the manufacturer. The Marketing Manager has little or no control over the actions of competitors. Competitors considerably influence the company‘s choice of marketing strategies, particularly in relation to selection of target markets, suppliers, marketing channels as well as in relation to its product-mix, price-mix and promotion-mix. Marketing strategy is itself a plan to fight against competition and to win over the competition. Examples:Thepagingindustryhasbeen almostwipedoutbycellularcompaniesofferingshort messaging service.Typewritershavebecomeobsoletewiththeintroductionof computers. 4. Competition
  • 41. The marketing efforts arealso influenced by internal forces that are controllable by the management.These forces include Production, Finance, HR, Research and Development, Company location, Company image and marketing-mix components of product, price, promotion and distribution. Example: A Company wants to increase sales volumes by extending the marketing activities to new geographical areas. It has to consider human resources requirements like number and type of sales people required to cover the new markets.
  • 42. Marketing and other functional Areas  Marketing plays a vital role in any organization.  Marketing plays a vital role in finding the needs and wants of targeted customers.  Marketing function has greater interdependence with other functional areas of business.  Marketing plays vital role in generating revenue to the organization.  Marketing has interdependence with Finance, Production, HR and Information system.
  • 43. Marketing Interface with the company
  • 44. Integrative function of Marketing More than the integrative function, marketing function today has to perform the role of providing a competitive advantage (a strength which is more than the competitor which is considered important and valuable by the customers) to the company. The marketing division has to scan the market environment, identify the market opportunities, and lead change within the company to help the policy makers prepare strategies for success.
  • 45. Marketing and Finance Marketing affects finance in the following ways:  The magnitude of expected cash flows  The risk of the expected cash flows  The growth rate of the expected cash flows
  • 46. Marketing and Finance Marketing • Innovation • Brand Equity • Corporate Social Responsibility • Supply Chain Relations • Strategic Alliances • Customer Satisfaction Finance • Firm Value • Stock Returns • Systematic Risk • Liquidity Risk • Cost of Debt Focus of the Extant Marketing Literature
  • 47. Advertising and Liquidity Risk  Advertising creates value through multiple channels  Increased cash flow  Reduced market risk  Increased liquidity  Advertising can also reduce liquidity risk
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