vjim marketing1

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MARKETING MANAGEMENT

It is the process of planning & executing the conception,pricing, promotion and distribution of goals, services, andideas to create exchanges with target groups that satisfy

customer and organisational objectives

Marketing Management is essentially a DEMAND Management



SELLING AND MARKETING

Selling Concept

Consumers if left alone will ordinarily not buy enough of products. Theorganisations must therefore make an aggressive selling and promotion effort

Essentially sell what they make or produce rather than make what marketwants

Marketing Concept

Determining needs and wants of target markets and delivering the desiredsatisfactions more effectively and efficiently than competitors




SELLING AND MARKETING


rting Point Focus Means Ends

Products

&elling Promotion rofits through ales Volume

Factory

he Selling Concept

arget Market ustomer

Needs

oordinated

Marketing

rofits through Customer Satisfa

he MarketingConcept



MARKETING MIX


arketing Mix

arget Market

Product

oduct VarietyQualtityDesign

Features rand Name

PackagingSizes

ServicesWarrantiesReturns

PlaceChannels

Coverage

Assortmen

tsLocations

Inventory

Transport

Price

ist PriceDiscounts

Allowances ayment Period redit Terms

Promotion

ales PromotionAdvertising

ales Force ublic Relations irect Marketing



MARKETING MIX


Company ProductsServicesPrices

ales Promotion

Advertising

ales force

ublic Relations

irect Mail andTelemarketing

DistributionChannels arget Custom

fferMix

romotion Mix



MARKETING MANAGEMENT PROCESS


ysing Marketing Opportunities

esearching and Selecting Target Market

esigning Marketing Strategies

lanning Marketing Programs

,rganising implementing and controlling mar



MARKETING PROGRAMME

•

• 4 P’s 4 C’s•

• Product Customer needs and Values

• Price Cost to Customer

• Place Convenience

• Promotion Communication




PRODUCT LIFE CYCLE(PLC)


Sales

Profit

Introduction

Growth

Maturity

Decline

Time



VALUE DELIVERY PROCESS

•

• Identify the major attributes that customers value

• Assess the quantitative importance of the different attributes

• Assess the company’s and competitors performance on the

different customer values against their rated performance• Examine how customers in a specific segment rate the

company’s performance against a specific major competitoron an attribute by attribute basis

• Monitor customer values over time

•






ake the product ell the product

Desig

Product

Procure

Make Price Sell Advertise

/Promote

Distribute

Service





Pricing

Sourcing/Making

Distributing/Servicing

hoose the

ValueCustomerSegmentation

/arket Selection focus alue

positioning

rovide theValue

roductdevelopment

ervicedevelopment

ommunicate the

value

alesforce

alespromotion

Advertising



MARKETING PLANNING


argetCustomer

Product

Pricelace

Promotion

Competitors

argetCustomer

Suppliers Public

Ma

rke t

ing

org a

niza

tion

and

imple me

ntin

gsy

stem

s

Marketing planning

systems

Ma

rket

ing

Info

rmat

ion

syst

ems

M a r k e t i n g C o n t r o lS y s t e m

/echnological physicalenvironment

/ocio culturalenvironment

/olitical legalenvironment

/emographic economicenvironment



DETERMINANTS OF CUSTOMER ADDED VALUE


roduct Value

ervices Value

ersonal Value

mage Value

onetary Cost

ime Cost

nergy Cost

sychic Cost

otal Customer Cost

otal Customer Value

ustomer Delivered



CUSTOMER VALUE


ustomer delivered value is he difference between total ustomer value and total

.ustomer cost Total customer

alue is the bundle of enefits customers expect

rom a given

.roduct or service



MEHTODS OF TRACKING & MEASURING CUSTOMER SATISFACTION


.omplaint and Suggestion

Systems. ustomer SatisfactionSurveys

. host Shopping

. ost Customer Analysis

. autious in Measuring

ustomer

Satisfaction



SATISFACTION


ALUE CHAIN

•

•

•

irmInfrastructure M

argins

Servicearketing

&Sales

utbound logisticsOperationsnbound Logistics

Procurement

echnology Development

uman ResourceManagement

rimary Activities

M

DELIVERING CUSTOMER VALUE AND



DELIVERING CUSTOMER VALUE ANDSATISFACTION


alue DeliverySystem

!lease read



MEHTODS OF TRACKING & MEASURING CUSTOMER SATISFACTION


.omplaint and Suggestion

Systems. ustomer SatisfactionSurveys

. host Shopping. ost Customer Analysis

. autious in Measuring

ustomer

Satisfaction



SATISFACTION


• S will be less in industries where industries

ffer homogeneous product to a heterogeneous

.arket• S will be high in industries where high quality

omogeneous product is offered to a homogeneous.arket

• S will be lower where repeat buyers face

.witching costs They have to buy from a buyer.ven when CS is low

• ndustries which create repeat business generally/ave create higher level of CS

• .s company increases its market share CS can fall

his is because more customers with eterogeneous demands are drawn into buying a.airly homogeneous product



CUSTOMER/PRODUCT PROFITABILITY ANALYSIS


C1 C2 C3

P1 ++ +HighProfitabilityProductP2 + +ProfitableProduct

P3 _ _ LosingProduct

P4 + _ Mixed-

BagProductHighProfitCustomer

Mixed-BagCustomer

LosingCustomer

Products

Customers



GENERAL ELECTRIC APPROACH - CLASSIFICATION

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nvest

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Selectivity

/ Earnings

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usiness Strength

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GENERAL ELECTRIC APPROACH - STRATEGIES

Protect Position•Invest to grow at maximumdigestible growth•Concentrate effort onmaintaining strength

Invest to Build•Challenge for leadership•Build selectively on strengths•Reinforce vulnerable areas

Build Selectively•Specialize around limitedstrengths•Seeks ways to overcomeweakness•Withdraw if indications of sustainable growth are lacking

Invest to Build•Invest heavily in mostattractive segments•Build up ability to counter competition•Emphasize profitability by raising

productivity

Selectivity/Manage forearnings•Protect existing programme•Concentrate investments insegments where profitability isgood and risks are relatively low

Limited expansion orharvest•Look for ways to expand withouthigh risk,otherwise, minimizeinvestment and rationalizeoperations

Protect andRefocus•Manage for current earnings•Concentrate on attractivesegments•

Defend strengths

Manage forearnings•Protect position in most profitable segments•Upgrade product line•

Minimize investment

Divest•Sell at time that willmaximize cash value•Cut fixed costs and avoidinvestment meanwhile

High

Medium

Low

Weakediumtrong

usiness Strength



MAJOR CLASSES OF GROWTH OPPORTUNITIES


ive growth ntegrative growth iversification g

Penetration ackward Integration oncentric DiversificationDevelopment orward Integration orizontal Diversification Development orizontal Integration onglomerate Diversification

Market PenetrationStrategy

Product DevelopmentStrategyMarket Development

Strategy

Diversification

Strategy

urrent Products

ew Markets

urrent Markets

ew Products



INTEGRATIVE AND DIVERSIFICATION GROWTH


Suppliers

Company

Competitors

hole Sellers Retailers inal Customer



BUSINESS STRATEGIC PLANNING


ness Mission

eedback nd

Control

nternalEnvironmentAnalysis

External

nvironment Analysis

Implementationrogram

formulationoal formulation

Strategyformulation



MACRO & MICRO ENVIRONMENT


MACROENVIRONMENT

MICROENVIRONMENTDEMOGRAPHIC/ECO

NOMICCUSTOMERS

TECHNOLOGICAL COMPETITORS

POLITICAL/LEGAL DISTRIBUTIONCHANNELSSOCIAL/CULTURAL SUPPLIERS



OPPORTUNITY MATRIX


1 2

3 4

High Low

High

Low

Attractiveness

uccessProbability

:NITY It is an area of need in which a company can perform profita

t is a challenge posed by an unfavorable trend or development that

, ,ould lead in the absence of defensive marketing action to rofit deterioration



THREAT MATRIX


1 2

3 4

High Low

High

Low

Seriousness

robability ofoccurrence

:NITY It is an area of need in which a company can perform profita

t is a challenge posed by an unfavorable trend or development that

, ,ould lead in the absence of defensive marketing action to rofit deterioration

STRENGTH / WEAKNESS ANALYSIS





Major Strength

Minor Strength

Neutral Minor Weakness

Major Weakness Hi Med Low

Marketing

Company ReputationMarket ShareProduct Quality

Service QualityPricing EffectivenessDistributionEffectivenessFinance

Cost / Availability of

capitalCash flowFinancial Stability

Performance

Importance






Major Strength

Minor Strength

Neutral Minor Weakness

Major Weakness Hi Med Low

ManufacturingFacilitiesEconomies of scaleCapacityAble dedicated

workforceAbility to produce ontimeTechnicalmanufacturing skillsFinanceVisionary capableleadershipDedicated employees

EntrepreneurialorientationFlexible and responsive

Performance

Importance



STRATEGY FORMULATION


• ver all cost leadership•Differentiation

•Focus

PROGRAM FORMULATION

• …echnological Leadership etc

IMPLEMENTATION• !trategy is only one of seven elements

-S Framework

FEEDBACK AND CONTROL

• ,ontrol Review and if required change



7-S FRAMEWORK


McKinsey

Strategy

Skills

Structure

Systems

Staff

hared Values

Style

MARKETING INFORMATION SYSTEM & MARKETING RESEARCH



MARKETING INFORMATION SYSTEM & MARKETING RESEARCH


, , , ,IS consists of people equipment and procedures to gather sort, , , ,nalyze evaluate and distribute needed timely and accurate

nformation to marketing decision making

keting Managers

ANALYSIS

PLANNING

IMPLEMETATION

CONTROL

ASSESSING NFORMATION NEEDS

DISTRIBUTINGINFORMATION

NTERNAL RECORDSMARKETINGINTELLIGENCE

MARKETINGRESEARCH

MARKETINGDECISION

UPPORTANALYSIS

arketing ENVIRONM

ARGET MERKETS

ARKETING CHANNEL

COMPETITORS

PUBLICS

ACROENVIRONMENT FO

ARKETING INFORMATION SYSTEM

EVELOPING INFORMATION

AKING DECISIONS ANDCOMMUNICATING

ANALYSING MARKETING INFORMATION SYSTEM & MARKETING RESEARCH




TERNAL RECORDS


•

•

• SALES• PRICES• INVENTORY LEVELS• RECEIVABLES• PAYABLES etc..

•

ORDER TO REMITTANCE CYSCLE

SALES REPORTING SYSTEMS DESIGNING A USER-ORIENTED REPORTS SYSTE

MARKETINGINTELLIGENCE

•

It is a set of procedures and sources used by managers to obtain their everyday information about pertinent developments i

Ways of Scanning

•Undirected Viewing•Conditional Viewing

•Informal Search•Formal Search






MARKETINGRESEARCH

ection, analysis, and reporting of data and finding relevant to a specifi

rch

irmsfirms

esearch firms

rch






he Marketing Research Process

•

– .ollecting the information Most expensive and most liable for error

r ob lem a nd r ese ar ch o bj ect ive s eveloping

he esearch Plan

Collecting he

Information

nalyzing he

information

resenting he

findings






he Marketing Research Process eveloping the Research Plan

Data

Sources

•Secondary Data

Internal Sources, Government Publications, Periodicals and Books, Commercial Data•Primary Data

ResearchApproaches

Observational research, focus group research, surveyresearch, experimental

researchResearchInstrumen

ts

Questionnaires•Closed End – Dichotomous, Multiple choice, Likert Scale,

Semanticdifferential, Importance scale, Rating scale, Intention to

buy scale•Open End – Completely unstructured, Word association,Sentence completion,

Story completion, Picture completion, Thematicappreciation test

Sampling

Plan

•Sampling unit•

Sample size•Sampling procedure : Probability(simple random,stratified random, cluster) Non Probability Sample( Convenience,

judgment, quota)

ContactMethods

Mail questionnaire, telephone interviewing, Personalinterviewing



CHARACTERISTICS OF GOOD MARKETING RESEARCH


• CIENTIFIC METHOD• ESEARCH ACTIVITY• ULTIPLE METHODS

• NTERDEPENDENCE OF MODELS and DATA• ALUE AND COST OF INFORMATION• EALTHY SKEPTICISM• THICAL MARKETING

MYTHS THAT HAVE TAKEN MARKETING MANAGEMENT DOWN THE WRONG PATH

• brands best prospects are the heavy buyers in thecategory• ,he more appealing a new product is the more likely it

ill be a success

• he effectiveness of advertising is revealed by how emorable and persuasive t is• company is wise to spend the major portion of its

esearch budget on focus roups and qualitative research



WHY MARKET RESEARCH IS NOT UTILIZED PROPERLY


• Narrow conception of marketing research• neven caliber of marketing researchers• ate and occasional erroneous findings by

arketing research• ntellectual differences



MARKETING DECISION SUPPORT SYSTEM


….. , ,coordinated collection of data systems tools nd techniques with support software and hardware

y which an organization gathers and interprets elevant information from business and environment.nd turns it into basis of marketing action

Marketing Data

Marketing Decision Support System

Marketing evaluations and

tatistical Bank

egression analysis orrelation analysis

actor analysis iscriminate analysis

luster analysis o joint analysis……..tc etc etc

•

odel Bank

roduct design model ricing model

ite selection model-edia Mix model

dvertising budget model…tc etc etc



DEMAND MEASUREMENT AND FORECASTING


roductLevel

paceLevel

imeLevelong

Range edium

Range hort

Range

Customer

llsales

ndustry

Sales ompanySales

roductline

roductform

roductItem

Territ o

ry

Region

USA

World

0 types of demand meas

x 5 x 3




arket is a set of all actual and potential buyer of a,roduct and All Potential

uyers would have 3 characteristics

•Interest•Income•Access

DEMAND MEASUREMENT AND FORECASTING

otal Market otential Market

otentialMarket 0

%

%00otalPopulation

otentialMarket

%00

%0

%0

%0

%

vailable

Market

ualified vailable

Market

ervedMarket

enetratedMarket

VOCABULARY FOR DEMAND MANAGEMENT





ARKET DEMAND

ned customer group in a defined geographical area in a defined tim

ARKET FORECAST

f Industry where marketing expenditure actually occur is Marketing

ARKET POTENTIAL

,ket demand as industry marketing expenditures approach infinity fo






OMPANY DEMAND

’ .( = )t is the company s share of market demand Qi SiQ= ’i Company s Dmand= ’i Company s Market Share

=Total Market Demand

OMPANY FORECAST

.chosen marketing plan and an assumed marketing environment

, .ompany division or sales representative It is primarily a manager

ed volume of sales and is used primarily for making current purchasales

Quota

alesBudget

OMPANY POTENTIAL

pproached by company demand as company marketing effort increases

ESTIMATING CURRENT DEMAND



ESTIMATING CURRENT DEMAND


= nqp

= =Total Market Potential n

/umber of buyers in the specific product market= =Quantity purchased by an average buyer p Price of an

verage unit

alls for identifying all the potential buyers in each.arket and estimating their potential purchases It is effective and

fficient if one has a list of all potential buyers and a good estimate of.hat each will buy

– ne of the best methods used is Index.ethod

= . + . + .i 0 5Yi 0 3 Ri 0 2Pi

=i Percentage of total national buying power found in

rea I=i Percentage of national disposable personal income

riginating in area I=i Percentage of national retail sales in area I=i Percentage of national population located in area I

OTAL MARKET POTENTIAL OTAL MARKET POTENTIAL

ARKET BUILD UPMETHOD

-ULTIPLE FACTOR INDEXMENTHOD

REA MARKET POTENTIAL REA MARKET POTENTIAL

RAND DEVELOPMENT INDEX MENTHOD

ESTIMATING FUTURE DEMAND




ESTIMATING FUTURE DEMAND

OPLE SAY WHAT PEOPLE DO WHAT PEOPLE HA

MACROECONOMIC FORECAST

xpert Opinion rend Exploration rend Correlation

conometric Modeling-ross Impact Analysis

ultiple Scenarios

emand Hazard forecasting

INDUSTRY FORECAST

COMPANY SALES FORECAST

ENVIRONMENT FOR MARKETING DECISIONS



ENVIRONMENT FOR MARKETING DECISIONS


TREND

direction or sequence of events which have some momentum and dura

AJOR MACROENVIRONMENT FORCES

mographic Environment

orld wide explosive population growth opulation age mix determines needs

thnic Markets ducational groups

ouse hold patterns eographical shifts in population

hift from macro markets to micro markets

CONTENTS OF MARKETING PLAN



CONTENTS OF MARKETING PLAN


. xecutive Summary quick plan fro quick management skimming

. urrent Marketing Situation arket Situation roduct Situation

ompetitive Situation istribution Situation

acro Environment Situation. pportunity and Issue Analysis

/pportunity Threats Analysis/trengths Weakness Analysis

.Objectives inancial Objectives arketing Objectives

CONTENTS OF MARKETING PLAN 2



CONTENTS OF MARKETING PLAN - 2

. arketing Strategy arget Market

Positioning roduct LinePrice

istribution Outlets ales force

ServiceAdvertising

ales Promotion esearch and development arketing Research

. ction Programs

. rojected profit and loss statement

.Controls

vjim marketing1

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