MARKETING MANAGEMENT

UNIT-1
OBJECTIVES OF MARKETING MANAGEMENT:-
1. Creation of Demand-
 the first objective is to create demand through various means.
 Must make attempt to increase preferences and taste of consumers
 Goods and services to be produced to satisfy the needs of customers
 Providing the information of utility of goods and services among the consumers

2. Customer Satisfaction-
 Marketing manager must survey the demands of consumers and then try to fulfil it
 Along with selling customer satisfaction must be kept in mind
 Marketer should his marketing customer oriented

3. Market Share-
 Out of total purchases of a customer of a product or service, what percentage goes to a company
defines its market share. In other words, if consumers as a whole buy 100 soaps, and 40 of which are
from one company, that company holds 40% market share.
 It shows the size of a company, company’s dominance in the competitive market.

4. Generations of Profit-
 Important for marketing department to generate profit
 Profit earning must be related to the ‘Sale of Want’ and satisfaction of customers
 Profit should also be related to growth and diversification of the firm.

5. Creation of Good will and Public Image

 Important for a marketer to establish goodwill and public image
 Company must focus in providing quality products to customers at reasonable rates
 Goodwill can be established through sales promotion, publicity and advertisement
 public image can be established through high quality, reasonable price, convenient
distribution outlets.

7 Major Importance of Marketing Management

1. Marketing Helps in Transfer, Exchange and Movement of Goods
 Helps to both to customers and producers.
 Marketing provides specific needs and preferences of consumers
 What all products manufacturers can offer
 Involves the design of the products acceptable to the consumers
 Conducts the activities which facilitates the transfer the ownership between the seller and
buyer
2. Marketing is helpful in raising and maintaining the standard of living of the community
 Marketing is the delivery of standard of living
 Marketing provides opportunity to settle a better and comfortable society
 Marketing adds on the development of the community.
 Ensures uninterrupted supply of goods and services
 Ensures the availability of good and services to every class of the community
3. Marketing Creates Employment
 Involves a variety of work thus promoting a large number of employment
 Major marketing functions are- buying, selling, financing, transport, warehousing, risk
bearing and standardization.
 For each set of step good amount of human work force is required
 High production is very important and then marketing of the product is needed therefore
involvement of large number of people becomes mandatory

4. Marketing as a source of Income and Revenue

 A significant way to earn profit and generate income and revenue
 Through the analysis of income and revenue generated marketer can plan required marketing
steps
 Provides an objective and a target to be achieved by the marketers
 Provides opportunities to earn profits in the process of buying and selling the goods, by
creating time, place and possession utilities

5. Marketing acts as a basis for making decisions-

 Solves the basic doubts of production like what, how, when, how much and for whom.
 Helps to establish direct link between the producer and consumer
 Producers depends largely on marketing to decide what to produce and sell

6. Marketing acts as a source of new ideas

 Concept of marketing is dynamic
 Changes with the passage of time
 Rapid changes in the taste and preferences of consumers compels the marketing to remain
updated
 Acts like an instrument used to measure the change and new demand pattern of consumers

7. Marketing is helpful in development of an economy

 It helps the economy to keep moving
 Marketing is scientifically organised which makes the economy strong and stable
 Lesser the stress on marketing function, the weaker will be the economy

MARKETING ORIENTATION
 Market orientation is a business philosophy focused on identifying customer needs, wants and
meeting them.
 Company with market orientation approach focuses on designing and selling and goods and services
that satisfy customer needs to remain profitable.
 A successful market oriented company satisfies the needs and desires of customer through their
product.

DISADVANTAGE
 Market orientation lacks innovation.
 Market orientation primarily focuses on customer needs, thus, can make the company lose sight of
company’s technical breakthrough
 Product oriented company tend to be technically and scientifically innovative, but may lose out
consumers being unable to know what they want.

TYPES OF MARKETING ORIENTATION

1. PRODUCTION ORIENTATION-
 focus is to reduce costs through mass production
 believes that mass production generates economies of scale by reducing cost and
maximising the profit
 it avoids production efficiency processes thus ignoring product design and quality.
 Compromise at product design and quality reduces product appeal to customers.

2. PRODUCT ORIENTATION-
 It believes that product’s high quality & functional features makes a product superior
 Believes that if product is superior customers will obviously like it.
 But only superiority is not required, product must fulfil customer’s needs and demands

3. SALES ORIENTATION-
 Keeps a simple focus- make the product and then sell it to the target market.
 This orientation lacks relevant research related to market needs and desire
 Without effective research prior to product development and finally an effective
promotion strategy.

4. MARKET ORIENTATION-
 This orientation takes the customer as the heart of business.
 All activities are based around the customers
 Endeavours to understand customer needs and wants and then implements marketing
strategy.
 Further research is done to identify the change of need demand of consumer to improvise
product

CORE CONCEPT OF MARKETING

Marketing is social and managerial process by which individuals and groups obtains what they needs and
wants through creating and exchanging product and value with others.
1. Needs-
 to create the existence of unmet so as to undertake marketing activities.
 Tries to satisfy needs of consumers
 Human nature feels the state deprivation of basic satisfaction
 This state of deprivation creates the need.
 Need is the state of mind which reflects restlessness in humans and thus need is created.

2. Wants-
 Wants satisfies the need
 Wants is the desire of consumers
 To fulfil the desire of consumers, the needs of consumers are satisfied
 Needs are limited but wants are many
 Marketer concentrates on creating and satisfying wants

3. Demand-
 It is related to the want for specific product
 Demand is related to the ability and willingness to buy the product
 Demand is directly depended on time
 It is important that all demands are fulfilled within the time
 Demand provided by time according to the ability and willingness to buy increases the
demand
 Demand is influenced by making the product attractive, affordable and easily available.

4. Product-
 Product includes both good and services
 Consumers gets more satisfaction by the service of the product not merely by buying the
product
 The service provided by the product after owning it attracts the consumer to buy the product
 Product is also referred as bundle of satisfaction both the physical and psychological.
 Tangible product is a package of services or benefits
 Marketer should consider product benefits and services instead of product itself
 Anything which can satisfy the need and want can be product
5. Utility (Value), Cost, Satisfaction-
 Utility means overall capacity of product to satisfy need and want
 Utility is the guiding concept to choose the product
 Buyer purchases a product which has more utility
 Thus utility is the strength of product to satisfy a particular need
 Cost means the price of product
 Charge paid by the customer to avail certain service is the cost of the product
 Utility of product is compared with cost that he has to pay
 Consumer prefers to buy the product which has more utility within a limited price
 Satisfaction means the fulfilment of needs.
 Satisfaction is achieved when a consumer gets the more value (utility) of the product by
paying limited cost
 Satisfaction is closely related to the fulfilment of the expectations of the consumer

6. Exchange, Transaction, and Transfer-

 Marketing is a platform where people satisfy their needs and wants through exchange
 Exchange is an act of obtaining a desired product from someone by offering something in
return.
 Exchange is possible when following five conditions are satisfied_
i. There should be at least two parties
ii. Each party has something that might be of value for the other
iii. Each party is capable of communication and delivery
iv. Each party is free to accept or reject the exchange offer
v. Each party believes it is desirable to deal with the other party

7. Relationship and Network

 Marketing practice is deeply related to relation building which is called relationship
marketing
 Relationship marketing is the practice of building long-term profitable or satisfying relation
with key parties like customers, suppliers, distributors and others in order to retain their long-
term preference in business.
 A marketer must focus on long term market relationship based on trust and win-win situation
 Relationship marketing needs trust, commitment, cooperation and high degree of
understanding
 Network is an important part of relationship marketing
 Marketing network includes company and its stakeholders like, customers, employees,
suppliers, distributors, advertising agencies and many others.

8. Market, Marketing, Marketer and Prospect-

 Market consists of all potential customers sharing a particular need or want who might be
willing and able to engage in exchange to satisfy this need or want
 Marketing is a social and managerial process by which individuals and groups obtain what
they need and want through creating and exchanging product and value with others
 Marketers is one who seeks one or more buyers to engage in an exchange. A marketer is
normally a company or business unit and the consumers who buy product from a company
for satisfying his needs or wants can be said as the prospects.

NEED, WANT, DEMAND

Phillip Kotler defines modern marketing as “Marketing is social and managerial process by which
individuals and groups obtains what they need and want through creating and exchanging product and value
with others.”
MARKETING MIX
It refers to the set of actions that a company uses to promote its brand. Marketing mix comprises of typical 4
Ps
 Price
 Product
 Promotion
 Place
To add on now we have another contemporary 4Ps which includes
 Packaging
 Positioning
 People
 Politics

PRICE-
 Refers to the value which is put for a product
 Depends on cost of production, segment targeted, ability of the market to pay, supply-demand and a
host of other direct and indirect factors.
 Used as a demarcation to differentiate and enhance the product image
This marketing mix includes-
 Price strategy
 Pricing
 Allowances
 Discounts
 Payment terms

PRODUCT-
 Related to the items which are actually sold
 Must have the ability to perform a minimal level of performance
 Plays a crucial in the successful implementation of marketing mix
This marketing mix includes-
 Features
 Quality
 Branding
 Packaging
 Services
 Warranties

PLACE-
 Refers to point of sale
 Catching the eye of the consumers and making it easy for consumer to buy
This marketing mix includes-
 Channels
 Market coverange
 Assortment
 Location
 Inventory
 Transport

PROMOTION-
 Related to activities undertaken to make the product or service known to the user and trade
 Includes advertising, word of mouth, press reports, incentives, commissions and awards to the trade
This marketing mix includes-
 Sales promotion
 Advertising
 Public relations
 Direct marketing
IMPORTANCE
 All elements influence eachother
 Helps to make business plan for the company to to handle in right manner and achieve
success
 Needs lots of understanding, market research and consultation with several people, from
users to trade to manufacturing and many others.

CONCEPT OF COSTUMER VALUE

Customer value is related to the difference between the values the customer gains from owning and using a
product and the cost of obtaining the product.
We live in an unstable and dynamic world where the change is necessity, the rate of change keep
accelerating all the time which in turn effects the customer’s needs, wants, expectation.
The customer can anytime become more demanding about the reliability, better quality of the product and
services. It is important for the marketer to maintain these demands of the customer to sustain in the market
TYPES OF VALUE
1. FUNCTIONAL VALUE- It is related to the extent to which a product is useful, has desired
characteristics and, and performs a desired function
 Appropriate features and characteristics- quality, aesthetics, creativity and customization.
 Appropriate performance – performance quality, reliability and service –support outcomes
 Appropriate outcomes- effectiveness, operational benefits and environmental benefits.

2. EXPERIMENTAL VALUE- It is related to the extent to which a product creates appropriate

feelings, experiences and emotions for the customer. Example- restaurants mainly focus on
aesthetics, aromas, ambiance. Organisations in travel or entertainment focus on creating emotional
values like pleasure fun excitement adventure.

3. SYMBOLIC OR EXPRESSIVE VALUE- It is related to the extent to which customers associate

psychological meaning to product. Some product appeal to customer’s self-concept and self-worth.
The products are bought because of their status, prestige and image

CONSUMER BUYING BEHAVIOUR: INTRODUCTION, CHARATERISTICS

Consumer behaviour is the actions and decisions processes of people who purchase goods and services for
personal consumption.

Consumer buying behaviour- it is sum total of a consumer’s attitude, preferences, intentions and decisions
regarding the consumer’s behaviour in the market place while purchasing the product or service.
 Consumer behaviour has the impact of social science disciplines like anthropology, psychology,
sociology and economics.
CHARACTERISTICS OF CONSUMER BEHAVIOUR
1. PROCESS- consumer behaviour has a systematic nature of buying decisions related to the
consumers. The below mentioned processes are included in the process of consumer behaviour:
 Identification of buying the product
 Information related to the search of buying product
 List of alternative brands
 Evaluating the alternative (cost-benefit analysis0
 Purchase decision
 Post-purchase evaluation by the marketer

2. INFLUENCED BY VARIOUS FACTORS- the following factors influence the consumer

behaviour very strongly
 Marketing
 Personal
 Psychological
 Situational
 Social
 Cultural

3. DIFFERENT FOR ALL CUSTOMER- each consumer possesses a unique buying behaviour and it
could due to various individual factors such as nature of the consumers’ life style, culture etc.

4. DIFFERENT FOR DIFFERENT PRODUCTS- consumer buying behaviour varies from one
product to another; the reason and factors could be many like quantity of items, brand of the product
etc

5. REGION BOUNDED- consumer behaviour varies across states, regions and countries, a consumer
always show buying according to the area and society where he lives. A consumer living in urban
area will have a behaviour different from those who are living in rural area.

6. VITAL FOR MARKETERS- marketers need to have a good knowledge of consumer behaviour. It
is important for a marketer to remain aware various factors that influence consumer behaviour of
their target consumers, thus enabling the marketer to take appropriate marketing decisions.

7. REFELCT STATUS- the buying behaviour of consumer is not related to his habit of buying
influenced by his nature of buying but it also reflects the status of the consumer. This status reflected
by the buying behaviour of the consumer is owned very preciously by the consumer.

8. SPREAD EFFECT- the buying of one consumer spreads to another too. Through our buying
behaviour we influence our friends and family. The showcasing of celebrities using various brands is
a way to spread the effect of the product of that product among the consumers.

9. STANDARD OF LIVING- the buying behaviour clearly reflects the standard of living of the
consumers, the kind of goods and services used by the consumer becomes the identity of that person
at various social, personal and professional platforms.

10. KEEPS ON CHANGING- consumer behaviour is transitory in nature, with time there are various
social, personal depending upon changes in age, education and income level.

BUYING MOTIVE
It is the motive to persuade the desire of people for buying any particular goods and service
It is related to the feelings and emotions of people.
IMPORTANCE OF BUYING MOTIVE
 Helps to target the customer.
 Helps to understand the desire of customer and then to fulfil it
 Helps to understand the need of customer
 Through buying motive the marketer can help in triggering the buying instinct of the customer.
TYPES OF BUYING MOTIVES
1. PRODUCT BUYING MOTIVES-
 Related to the characteristics, traits and factor of the products which persuade (makes the
consumer ready) to buy that product in comparison to the other products available in the
market. The factors can be physical, psychological, safety factors,
 Product buying motives is divided into two categories
 Emotional- buying which is done without applying the reasoning. Emotional buying motives
are related to prestige, imitation, affection, comfort, ambition, distinctiveness, pleasure, habit
 Rational- buying which is done because of reason, after analysing the need and necessity and
the usage of the product. It is related to security, economic, low price, suitability, utility,
durability, convenience.

2. PATRONAGE BUYING MOTIVES-

 Those factors which influence the consumer to purchase a product from particular shop instea
of other places.
 Two categories-
 Emotional- when a consumer does the buying from a particular shop without thinking much
about the other available shops. 6 kinds of emotional patronage buying-
1. Ambience of shop
2. Showcase of products
3. Recommendations by others
4. Prestige
5. Habit
6. Imitation

 Rational-product purchased from a shop after complete analysis and reasoning

FACTOR INFLUENCING CONSUMER BEHAVIOUR
Consumer behaviour is defined as decisions and actions which influence the purchasing behaviour.
Important for marketers to know what triggers the consumers’ mind towards buying the product
Purchasing is mostly influenced by rational and emotional reasoning
Study of consumer behaviour must be related past buying pattern and prediction of present and related future
buying pattern
1. MARKETING CAMPAIGN- advertisements play a crucial role in impacting the consumer buying
behaviour
It has the ability to shift the market share by influencing the purchasing decisions of consumers
Marketing brings awareness to the consumers buy not much attractive products like insurances,
medicines

2. ECONOMIC CONDITIONS- decisions influenced by the economic situation, important to create a

positive economic environment makes consumer confident and willing to buy.

3. PERSONAL PREFERENCES- personal preference of consumer behaviour is related to likes,

dislikes, priorities, morals and values. Marketers of fashion, food, personal care is very much related
to it. Consumers personal preference exerts a greater influence on the end purchase by the consumers

4. GROUP INFLUENCE- play a vital role in the consumer buying behaviour. Primary influential group
is that of family, classmates, immediate relatives and secondary influential group consists of
neighbours, friends, colleagues.
5. PURCHASING POWER- pays a vital role. Consumer analyses his purchasing power before making
any purchase, sometime very good product may fall beyond the purchasing power of the consumer,
therefore important for the marketers to analyse and identify the purchasing power of his consumers.

INFLUENCES OF CONSUMER BEHAVIOUR

1. INTERNAL INFLUENCE
i) Personal Factors
 Age
 Income
 Occupation
 Life style
 Personality

ii) Psychological Factors

 Motivation
 Perception
 Learning
 Beliefs and Attitude

2. EXTERNAL FACTORS
i) Cultural Factors
 Culture
 Sub-culture
 Social class

ii) Social Factors

 Family
 Reference group
 Role and status

STAGES IN CONSUMER BUYING BEHAVIOUR

STAGE 1- NEEDS/ REQUIREMENTS- at this stage the consumer realises the needs and requirements
which can be generated either by external or inter stimuli. At this stage marketer must study and understand
what kinds of needs and requirements rise mostly among the consumers

STAGE 2- INFORMATION SEARCH- at this stage consumer gather all relevant information which affects
his buying behaviour. For information search consumer can use industrial source, personal source, public
source and experiential source.

STAGE 3- EVALUATION OF ALTERNATIVES- at this stage consumer uses the information to evaluate
alternatives brands depending upon individual or specific buying situation. Different factors play a crucial
role in the stage 3.
STAGE 4- PURCHASE DECISION- at this stage consumer reaches the stage of buying and before reaching
this stage every consumer has to undergo purchase intentions and purchase decision. And these two aspects
are deeply influenced by the income, usual price and usual product benefits.

STAGE 5- POST-PURCHASE BEHAVIOUR- at this stage the consumer reaches the level where the
futuristic decision of buying behaviour is related. The stage of purchasing either reaches to satisfaction or
dissatisfaction and depending upon it the consumer shows his further buying behaviour

TYPES OF CONSUMER BUYING BEHAVIOUR

It depends on the degree of buyer involvement and the degree of differences among brands.

1. ROUTINIZED RESPONSE BEHAVIOUR/ HABITUAL BUYING BEHAVIOUR- this is the

most simple buying behaviour, it involves some sort of buying experience and the usage of product,
this behaviour is shown in the buying of low cost and frequently bought items, buyer is friendly with
the product and has confidence about its service and credibility.

2. LIMITED PROBLEM SOLVING/ DISSONANCE REDUCING BUYING BEHAVIOUR- this

is a type of buying behaviour where the consumer knows the product but has no strong bond about
the brand service therefore the consumer does not show brand preference. Therefore, the consumer
here shows a complex buying behaviour. Consumer prefers to gather more information before
buying any desired product

3. EXTENSIVE PROBLEM SOLVING/ COMPLEX BUYING BEHAVIOUR- this is a type of

buying behaviour where the consumer is unfamiliar about the product and brand. The consumer has
no knowledge about the criteria of buying that product. This buying behaviour involves extensive
research and information gathering by the consumer about the product.

4. VARIETY SEEKING- consumer buying behaviour is tend to change very frequently. Inspite of
every satisfaction and brand preference there could be multiple reasons for the change of buying
behaviour among the consumers. This is one thing that makes the consumer a variety seeking
consumer and the marketer must bring frequent varieties to his product to satisfy such buying
behaviour of the consumer.