Meaning of Marketing
Narrow Concept
“Marketing is the performance of business activities that direct the flow of goods and services from producer to consumer or users.” – AMA (American Marketing Association)
Broad Concept
“Marketing is the activity, set of instructions and exchanging offerings that value for customers, clients, partners and society at large.” – AMA (American Marketing Association, 2013)
Today, marketing must be understood not in the old sense of marketing sales. “Telling and Selling” but in the new sense we can say marketing is “meeting customer needs profitability.”
Evolution of Marketing Philosophies
“Customer is the King of the market.” Marketing philosophy is the philosophy or principle of doing business.
The Production Concept (Popular in 1920 AD)
This concept believes that consumers will favor those products that are widely available and low in cost.
Production managers were oriented on:
- Mass production
- Low price/cost
- Mass distribution
The Product Concept (1920-1930 AD)
This concept believes that consumers will favor those products that offer good quality performance and innovative features.
Managers emphasized on:
- The quality improvement
- Durability of goods
- “Build a better mousetrap”
- Buyer admires quality
The Selling Concept (1930-1950 AD)
People do not purchase enough products unless they are persuaded to buy.
Managers in this concept:
- Convincing and persuading buyers
- Aggressive selling method
- High promotion, advertising, and personal selling (salesmanship)
- “Telling and Selling”
- Does not consider customer satisfaction
- The old concept of marketing
The Marketing Concept (1950-1970 AD)
It holds that the key to achieving organizational goals is being more effective than competitors in creating, delivering, and communicating superior customer value to your target market.
Pillars/Principles of marketing concept:
- Target market
- Customer-oriented
- Integrated marketing (co-ordination within the marketing department and also co-ordination between other departments of the company to satisfy customers)
- Profitability
The Holistic Marketing Concept (2004 Onwards)
This concept is an integration of marketing concepts and societal concepts with a focus on relationship marketing. Fairtrade: customers, stakeholders, employees, and employers; all are satisfied.
“Everything Matters in Marketing.”
Integrated Marketing
- co-ordination with marketing and other departments
- Channel
Internal Marketing
- Staff training to satisfy customers
Performance Marketing
- Profitability
- Corporate Social Responsibility (CSR)
Relationship Marketing
- Long-term relationship with customers and other parties (distributors, suppliers, bank), etc.
Meaning and Tasks of Marketing Management
Marketing Management
Marketing management is the process of decision-making, planning, and controlling the marketing aspects of a company. (It is PODC ‘Plan Organize Direct Control’ of marketing activities)
Tasks of Marketing Management
- Analyzing marketing opportunities (Comes from changes in environmental forces)
- Capturing marketing insights (MIS, MR-Market Research)
- Developing marketing strategy and plans
- Connecting with customers (Understand the needs and preferences of customers properly. Which is your target market? What? Why? When? Where? and How often do customers buy?)
- Building strong brands
- Creating value
- Communicating and delivering value
- Conducting market responsibility for long-term success
Marketing Challenges of the 21st Century
- Intense competition
- Expectation of consumers
- Changing habits of the consumer
- Changing media habit
- Creating consumer database
- Brand parity is less concern for quality by consumers as they believe the minor difference
- Adoption of relationship marketing
Firms’ responses to cope with the challenges of 21st Century
- Relationship marketing
- Integrated communication
- Innovating culture
- Target market
- Customization
- Digital Marketing
Relationship Marketing (1980)
Building a large group of satisfied and loyal customers is Relationship Marketing (RM).
“Relationship Marketing is the process of creating, maintaining and enhancing strong value-laden relationships with customers and stakeholders.”- Philip Kotler
Build relationships at many levels (economic, social, technical, legal, etc.)
Relevance/Importance of Relationship Marketing
- Long-term relation
- Customer satisfaction
- Loyal customer
- Good communication
- Development of business partnership
- Long-term profit
Practices of Relationship Marketing
- Basic Marketing
- Reactive Marketing
- Accountable Marketing
- Proactive Marketing
- Partnership Marketing
Approaches or Strategies for Relationship Marketing
- Quality assurance
- Financial benefits
- Social benefits
- Technical benefits
Relationship Building Process (Customer Development Process)
Suspects → Prospects (willing and ability to pay) → First-time customer → Repeat customer
Ex-customers Pool
Partners → Advocates → Member → Clients
Green Marketing
Green marketing refers to the process of selling products or services based on their environmental benefits. Such products are “environment friendly,” and concerned with environmental protection. If the environment is polluted with excess energy consumption, chemical use, and plastic bags, 3R (Reduce, Reuse, Recycle) should be implemented all around the world.
Practices of Green Marketing
- Environment awareness
- Resource conservation
- Recycled products
- Green product – Organic farming and marketing of organic food
E-Marketing
Buying and selling something electronically is e-marketing. It is also called internet marketing.
Electronic-Marketing is the marketers’ effort to inform, communicate, promote and sell their product through the internet or electronic media.
The World Wide Web of computers connects billions of people and firms together. (TV, computers, internet, telephone, ATM card, credit card, and VISA card)
Features of E-Marketing
- Individual communication
- Online selling
- Elimination of middleman
- Data depository
- Enhance promotion
- Global alliance
- Need for electronic devices
- Good relationship
Importance of E-Commerce
- Direct marketing
- Growth of sky shops, cyber stores
- Enhance promotion
- Profitable customers can be contacted
Marketing Mix – UPS of Marketing
The marketing mix is the set of marketing tools the firm uses to pursue its marketing objectives in the target market. The marketing mix is a blend of product, place, price, and promotional tools offered for customer combinations of different marketing activities.
The basic purpose of determining the marketing mix is to satisfy the needs and wants of the customers in the most effective manner.
Components of Marketing Mix
Marketing mix for Product (Product, Price, Place, and Promotion)
Product: Variety, Quality, Design, Features, Brand Name, Packaging, Services, Product Development, etc.
Price: List Price, Discounts, Allowances, Payment Period, Credit Terms, etc.
Place: Channels, Coverage, Assortments, Locations, Inventory, Transportation, Logistics, etc.
Promotion: Advertising, Personal Selling, Sale Promotion, Public Relations, Publicity, etc.
Marketing mix for Service (Product, Price, Place, Promotion, People, Physical Environment, and Process)
People: Internal Marketing (Employee, Manager, Professionalism, Politeness, etc.)
Physical Environment: External environment of the marketing (Land, Building, Location, Decoration, Cleanliness, etc.)
Process: Service-providing process (Order Delivery, Table Serving, Speed, Timely, Accuracy, etc.)
