MARKETING

MANAGEMENT NOTES

MBA 1st Semester

Faculty: Ms. Ruba Nasim
Unit- 1 By- Ruba Nasim

What Is Marketing?

Marketing refers to activities a company undertakes to promote the buying

or selling of a product or service. Marketing includes advertising, selling, and
delivering products to consumers or other businesses.

According to Philip Kotler,

“Marketing management is the analysis, planning, implementation and
control of programmes designed to bring about desired exchanges with
target markets for the purpose of achieving organisational objectives.”

To sum up, marketing management may be defined as the process of

management of marketing programmes for accomplishing organisational
goals and objectives. It involves planning, implementation and control of
marketing programmes or campaigns.

Nature and Scope of Marketing

Marketing being a part of social science is highly dynamic and complex in

nature. The rapid changes in various sectors have brought great changes in
the concept of marketing. Traditionally, marketing was concerned with
buying and selling of goods and services only but now its scope has widened
and it encompasses a range of activities from consumer satisfaction to
consumer delight and management of customer relationship.

The scope (subject matter) of marketing is as follows:

(1) Products and Services:

Products and Service are the basic element of marketing. If there is no
product there is no marketing. It is concerned with the nature and type of
products, product quality and design, product planning and development,
product decisions relating to branding, labelling, packaging, trademarks etc.

(2) Marketing Research:

It includes an analysis of nature and types of customers, size of market,
customer attitude, buyer behaviour etc. An in-depth analysis of customers
and markets is a prerequisite for every marketer to have a successful
marketing.
(3) Channel of Distribution:
The pathway through which the goods move from producer to consumer is
the channel of distribution. It includes a number of intermediaries like
wholesaler, retailers, jobbers etc.

(4) Physical Distribution:

The physical movement of the goods from producer to consumer is physical
distribution. It includes transportation, warehousing, inventory control and
management, order processing etc.

(5) Promotional Decisions:

Different promotional tools are there like advertising, sales promotion,
personal selling, publicity, public relations etc.

(6) Pricing Decisions:

This is the only element of marketing which generates revenue for the firm.
Pricing is concerned with pricing policies and strategies, price
determination, discounts, commissions etc.

(7) Environmental Analysis:

An analysis of the environment in which the business is to be carried out is
the first step for any organisation. The various macro and micro factors
should be studied beforehand only to develop an understanding of the
strength, weaknesses, opportunities and threats, for an organisation.

What Is a Marketing Mix?

The term often refers to a common classification that began as the four Ps:
product, price, placement, and promotion.

Product
This represents an item or service designed to satisfy customer needs and
wants. To effectively market a product or service, it's important to identify
what differentiates it from its competitors.

Price
The sale price of the product reflects what consumers are willing to pay for
it. Marketing professionals need to consider costs related to research and
development, manufacturing, marketing, and distribution all involved in
preparing a product
Place
The type of product sold is important to consider when determining areas of
distribution. Basic consumer products, such as paper goods, often are
readily available in many stores. Premium consumer products, however,
typically are available only in select stores. Another consideration is
whether to place a product in a physical store, online, or both. It is also
important to study the product before selecting the target market.

Promotion
Joint marketing campaigns also are called a promotional mix. Activities
might include advertising, sales promotion, personal selling, and public
relations etc. Determination of the best mediums to communicate the
message and decisions about the frequency of the communication also are
important.

Three additional Ps of marketing mix might include.. people, process, and

physical evidence.

People refer to employees who represent a company as they interact with

clients or customers.

Process represents the method or flow of providing service to the clients

and often incorporates monitoring service performance for customer
satisfaction.

Physical evidence relates to an area or space where company

representatives and customers interact.

IMPORTANCE OF MARKETING MANG.

Marketing management smoothen the process of exchange of ownership of

goods and services from seller to the buyer.
1. Analysing Market Opportunities:
Marketing management collects and analyses information related to
consumer’s needs, wants and demands, competitor’s marketing strategies,
changing market trends and preferences. This helps to identify market
opportunities.
2. Determination of Target Market:
Marketing management helps to identify the target market that the
organization wishes to offer its product.
3. Planning and Decision Making:
Marketing management helps to prepare future course of action. Planning
relates to product introduction, diversification. Decision making regarding
pricing, selection of promotional mix, selection of distribution channel is taken
by the marketing management.
4. Creation of Customer:
Consumers determine the future of the market .Therefore providing the best
product to the consumer according to their preference is the important task of
marketing. Marketing management helps in creation of new customers and
retention of current customers.
5. Helps in Increasing Profit:
Marketing caters to the varied and unlimited needs of consumers. Marketing
management helps to increase profit and sales volume. This is achieved by
expansion of market and increasing customers.
6. Improvement in Quality of Life:
Marketing management aims at providing innovative product and services to
the customers. Marketers continuously strive to incorporate new technology
and mechanism in their product to provide more satisfaction to customers
than before. This improves quality of life and makes life of consumers easier
than before.
7. Employment Opportunities:
Marketing process is a combination of different activities like research work to
assess the marketing environment, product planning and development,
promotion, distribution of product to customers and after sales service.
Marketing process requires researcher, production engineer, different
distribution intermediaries, sales personnel also creates employment
opportunities in advertisement section. Thus marketing management opened
up different employment thus creating employment opportunities.

FUNCTIONS OF MARKETING MANG.

Various functions of marketing management are:

1. Assessing the Marketing Opportunities:

Determination of marketing objectives and assessment of the marketing
opportunities for the firm, is an important function of marketing management.
The constantly changing market conditions and opportunities forces
marketing management to come out with planned progammes to meet the
challenges, and reap the opportunities.
2. Planning the Marketing Activities:
Planning is an important managerial function. Planning of marketing activities
is a crucial task and involves numerous steps. It involves planning effective
strategies to achieve the desired marketing objectives. It is concerned with
formulation of policies relating to product, price, channels of distribution,
promotional measures, forecast of target sales etc. Planning provides the basis
for an effective marketing for the enterprise.

3. Organising the Marketing Activities:

Another significant function of marketing is organising it implies
determination of various activities to be performed and assigning these
activities to right person, so that marketing objectives are achieved.

4. Co-Ordinating Different Activities of Enterprise:

Even the best of planning will not be rewarded if there is improper
coordination between different activities of the organisation. Marketing
involves various activities and these are inter-related and interdependent.
Product decisions, pricing strategies, channel structure research activities all
require proper coordination. Only then the objectives can be achieved.

5. Directing and Motivating the Employee:

A good direction is a must for effective performance of marketing functions.
Direction helps in ri ghtful performance of the work. Different leadership
styles are practised to guide the subordinates. A leader directs his subordinates
and ensures through effective supervision, that the performance is as per
planned specification. At the same time, it is necessary that employers are
properly motivated. Motivation not only helps in better performance by the
employee but also holds him back to the organisation for longer periods.

6. Evaluating and Controlling Marketing Efforts:

In order to have a profitable venture, marketing manager must evaluate the
results on a continuous basis. This will help him in knowing where the
organization is lacking. Controlling is a managerial function concerned with
comparison of actual performance with the standard performance and locating
the shortcomings if any, finally corrective measures are taken to overcome the
shortcomings.
Difference between Selling & Marketing

Selling is an action which converts the product into cash, but marketing is the process
of meeting and satisfying the customer needs. Marketing consists of all those activities
that are associated with product planning, pricing, promoting and distributing the
product or service. Selling focuses on the seller needs whereas marketing concentrates
on the needs of the buyer.

Selling is the modern version of Exchange under the barter system. When the focus is
on selling, the company management thinks that after production of the product has
been completed. It is the task of the sales department to sell whatever the production
department has manufactured. Aggressive sales methods are justified to this goal and
customer’s actual needs, and satisfaction on for granted.

But marketing is a wide and all-pervasive activity to a business firm. The task
commences with identifying consumer needs and does not end, till feedback on
consumer activities which comprises production, packaging, promotion, pricing,
distribution and then the selling. Consumer needs become the guiding force behind all
these activities. Profits are not ignored, but they are generated on a long run basis. The
distinction between selling and marketing are summarized in the following table:

Distinction between Selling and Marketing

S.NO SELLING MARKETING

1. Emphasis is on the product. Emphasis is on the customer wants

2 Company first makes the product and then Company first determines customer wants and then

figures out how to sell it. figures out to make it

3. Management is sales volume oriented Management is profit oriented

4. Profit through Sales Volume Profits through Customer Satisfaction

5. Planning is short-run-oriented, regarding Planning is long-run oriented regarding new product

today products and markets tomorrow’s markets, and future growth.

6. Let the buyer be aware Let the seller be aware

7. Product first then customer Customer first then the product

What is STP Marketing?
STP marketing is a model that stands for Segmentation, Targeting, and Positioning. It is
most commonly used strategy for marketers.
Segmenting
This is the practice of dividing your customers based on certain identifying
characteristics. While there are many ways to segment your market, here are
some of the most common ones:

 Age/Gender: Age and gender are very personal attributes, but they are also very
defining. The needs of a 20-year-old woman are inherently different than that of
a 60-year-old man, regardless of any other characteristic.
 Income: STP marketing professionals may also look at income level because the
more money people make, the more they tend to spend.
 Lifestyle: You may also want to segment your customers by lifestyle. For
instance, the needs of a customer with kids is often very different from those who
do not.
 Location: Look at your customers by location as well. Understanding where your
customers come from will help you target your ads and place them more
effectively.
 Behavior: This refers to brand loyalty, the kind of purchases customers have
made, and the frequency of purchases. For example, marketing message for
someone who hasn’t bought from you in a while will be very different compared
to a marketing message for someone who is a regular buyer.
 Beliefs and values: Religious and political beliefs can really define how you
reach out to potential customers.

Targeting
Once you have divided your customers into different groups, it is time to look at how
these segments contribute to your revenues and success. Based on this information,
you can then start to allocate marketing budgets and who to target, first. Here are three
ways to refine your targeting:
 Economic Potential: Depending on your business, you might find that one
segment is responsible for more sales than others. Thus, it might be more
productive to increase your marketing efforts for the group that spends more.

 Size: Next, look at the size of the segment. If one group contributes twice as much
as another, that doesn’t mean that it is absolutely the best segment to target. You
have to dig deeper. Look at the size of each segment and its potential for growth.
 Distinction: Finally, consider what makes a segment distinctive. You might see
that you have a segment with good economic potential and possibilities for
growth but if going after that demographic kills business as you know it, give it
some thought before you pursue that group.

Positioning
The last step in STP marketing is positioning. This involves creating a marketing mix to
reach your targeted segment and identifying the best way to reach your customers.
While there are many ways to do this, positioning strategies fall into three basic
categories:

 Function: Functional positioning is centered on how your product or service

meets the specific needs of your target demographic. This strategy relies on the
value you can provide your customer and the pain points you can resolve.
 Symbolism: You can also take the symbolism approach to positioning. Think
about what it is about your products or services that could bolster your
customers’ self-esteem and emphasize those features. Prestige brands often use
this strategy, playing up their logos, the exclusivity of their offerings, or a certain
lifestyle.
 Experience: Positioning can be based on the experience as well. This strategy is
designed to create an emotional connection with your target segment by focusing
on how it feels to use your products or services. Marketing messages like “Relax,”
“Let us take care of everything,” and “experience the difference” are examples of
this approach.

What Is SWOT Analysis?

SWOT (strengths, weaknesses, opportunities, and threats) analysis is a framework used

to evaluate a company's competitive position and to develop strategic planning. SWOT
analysis assesses internal and external factors, as well as current and future potential.

 SWOT analysis is a strategic planning technique that provides assessment tools.

 Identifying core strengths, weaknesses, opportunities, and threats that lead to
fact-based analysis, and new ideas.
 SWOT analysis is a technique for assessing the performance, competition, risk,
and potential of a business, Using internal and external data, a SWOT analysis can
tell a company where it needs to improve internally, as well as help develop
strategic plans.

SWOT Analysis was first used to analyze businesses. Now it's often used by governments,
nonprofits, and individuals, including investors and entrepreneurs.
Strength

It describes what an organization excels at and what separates it from the competition:
a strong brand, loyal customer base, a strong balance sheet, unique technology, and so
on.

Weakness

It stops an organization from performing at its optimum level. They are areas where
the business needs to improve in terms of customers, brand, capital, technology,
planning etc.

Opportunities

It refers to favorable external factors that could give an organization a competitive

advantage or an opportunity to grow.

Threats

It refers to factors that have the potential to harm an organization. For example, a
drought is a threat to a wheat-producing company, as it may destroy or reduce the crop
yield. Other common threats include things like rising costs for materials, increasing
competition, tight labor supply and so on.

Example- SWOT ANALYSIS OF AIRTEL

Strengths in the SWOT analysis of Airtel

1. Renowned Telecom company: With its 19+ years of rich experience in telecom
industry this MNC had travelled far to become world’s 3rd largest telecom operator
overseas with operations in nearly 20 countries.
2. High Brand: It is one of the pioneer brands in telecommunication with very large
customers.
3. Extensive infrastructure: Airtel has extended in all parts of the country resulting
into nationwide penetration.
4. Torchbearer of the telecom Industry: Because of its excellent services in
developing economies, Airtel has interconnected the life of people in an highly
efficient way. Airtel is a leading nationwide player in India and the torchbearer of
the telecom industry in India.

Weaknesses in the SWOT analysis of Airtel

1. High competition in the telecom market – Airtel, like all other service providers in
India, has been adversely affected by the extreme price competition of its competitors.

2. Late adoption of technology – Due to various regulatory uncertainties and delayed

spectrum auctions, India and Airtel were late to acquire the 4G party. The data tariffs
were high, speeds were unsatisfactory and customer’s acceptance of 4G was slow.
Opportunities in the SWOT analysis of Airtel

1. Strategic Partnership: Partnering with smart phone companies is going to be a

smart strategy as far as MNP (mobile number portability in India) is concerned.
This will ensure fixed cash flows in the future and a higher customer base.
2. Untapped geography of the current market: Although it is currently providing
3G & 4G services, but these services are limited to specific geographical locations.
Expansion of these services to most of its regions will help the company get more
margins and customers.
3. LTE: The whole wireless world is moving towards LTE (long term evolution or
4G). Airtel is working hard to capture the market.

Threats in the SWOT analysis of Airtel

1. Government Regulatory Framework: With the auction of spectrum & change in

the government policies on a regular basis, it is a potential threat to the stability &
existence of this industry thereby affecting the players.
2. Competition: Price war in the home market is a big threat in the growth of airtel.
3. MNP (Mobile number portability): MNP gives the customer independence to
change the service provider while retaining the number and as Airtel charges are
premium over other service providers, it can be a threat to the company.
1. Needs:

Needs are the basic requirements which human beings require for existence. These
mainly consist of air, water, food, clothing and shelter. Along with these needs, some
other needs which are required to be satisfied are education, medical care,
entertainment, and recreation.

The notion that marketer creates needs is wrong. The need actually pre-exists in the
market; the marketer just has to identify these needs, make the customers aware of
these needs, and make the customers believe that only their company can satisfy these
needs.

The needs can be further classified into 5 types as:

(i) Stated Needs:

These are the clearly defined needs of the customer; i.e. the customer clearly tells his
needs to the company. They are the easiest to deal with since through the stated needs
the marketer actually knows what the customer wants from them. For example, a
customer may ask for an inexpensive fridge.

(ii) Real Needs:

These are the actual needs of the customers which he may not be able to pinpoint to the
salesperson. In this case, salesperson has to ask questions to the customers to find out
the exact nature of the stated need by the customer. From the above example – if a
customer says that he wants an inexpensive fridge, he might be saying that he needs to
buy a fridge which consumes less electricity and thus save the electricity cost. In this
case the word “inexpensive” means that the initial cost might not be less but the
operating cost should be less; and for this the seller needs to ask specific questions to
understand the actual requirement of the customer.

(iii) Unstated Needs:

These are the benefits which are not asked by the consumers but they expect them
naturally with the products/services offered. E.g. Customer expects good service from
the showroom dealer from where he is going to purchase the fridge.

(iv) Delight Needs:

When a customer gets more than what he needs and if that makes him happy, then it is
called as delight needs. These needs help the marketer to cross the expectation level of
the customer. E.g. If the dealer provides the customer with free movable fridge trolley
and free fridge cover on purchase of fridge then the customer will be delighted.
(v) Secret Needs:

These are the needs which customer does not want to disclose but still gives indication
to have it from the seller. E.g. The customer wants his friends to see him as a savvy
customer and gain a social status for himself after buying the fridge.

2. Wants:

The wants are a step ahead of needs and are largely dependent on the human needs. A
need becomes a want when a need is directed to a specified object. Wants are designed
according to the taste and preferences of the society.

Needs already exists in the market; however, wants may be created by the marketers. It
can also be said that Need and Want are relative terms because a product may be
considered to be a need by someone but it may also be perceived as a want by others.
E.g. To have a food is a basic need of human beings but to have biscuits for food is a
want created by the marketers.

3. Demand:

A demand is generated when a customer is willing to buy a particular product and has
an ability to pay for it. A company should study not only how many people want their
product but also how many would actually afford to buy the product. E.g. Many people
would be desirous to buy Ferrari car; however, there is only a small segment which can
afford to buy it which reflects the demand for Ferrari car in the market.

Demand = Willingness to pay + Ability to pay

4. Customer Value:

A product or services is successful when it delivers value and satisfaction to the buyers.
Value is usually a combination of quality, service, and price.

Value increases with quality and service and decreased with price.

A high value product not only helps the company to generate new customers but also
helps to retain the older ones. Eg. Online parcel tracking facility provided by the courier
companies without any additional cost can be one of the best examples of customer
value. The same goes for free delivery of products purchased through online shopping
portals.

5. Exchange:

It is act of obtaining an object which one needs from another by offering some other
thing in return. Marketing occurs when individuals decide to satisfy needs and wants
through exchange. Marketing helps to create a business environment where exchange
of value can take place.
Eg. A man visiting a fast food chain might have enough money to buy a burger while the
fast food chain should have a burger.

6. Customer and Consumer:

Customers and consumers are used interchangeably to define the same individual but
there is a difference.

If an individual purchases an item for his own use, then that individual is a consumer;
however, if the individual buys the product as a gift or purchases it for someone else for
any reason then the person purchasing that product is the customer and the person
who will use the product or benefit from its purchase is the actual consumer. The
customer can be a consumer but a consumer may or may not be a customer.

Eg. If a person buys a bike for himself then he is the customer as well as consumer of
that bike but if a father purchases a bike for his son then the father will be customer
and the son the consumer.

7. Customer Satisfaction:

Satisfaction reflects a person’s judgment of product’s perceived performance in

relationship to expectations. Customer satisfaction with a purchase depends on how
well the product’s performance lives up to the customer’s expectations.

(i) If the performance falls short of expectations, the customer is dissatisfied.

(ii) If it matches expectations, then the customer is satisfied.

(iii) If it exceeds the expectations, then the customer is delighted.

In short:

Performance < Expectation → Dissatisfied Customer

Performance = Expectations → Satisfied Customer

Performance > Expectations → Delighted Customer

Satisfied customers will buy the product repeatedly and recommend the same to
others; however, dissatisfied customers may switch to the competitors and discourage
others to buy the product.

8. Customer Delight:

Customer delight can be defined as the effect of delivering a product or service that
surpasses customer expectations in a favorable experience.

Performance > Expectations → Delighted Customer

In most cases delighted customers tend to come back again because of the great
services they have received from the company. Customer Delight directly affects sales
and profitability of a company as it distinguishes the company and its products and
services from the competition.

9. Customer Loyalty:

Customers are said to be loyal when they consistently purchase a certain product or
brand over an extended period of time.

Loyalty also means customers hanging in there, even when there may be a problem
with the company’s products or services, just because the organization was good to
them in the past and had addressed their issues whenever they arise. It means that
customers do not seek out competitors and, even when approached by competitors do
not show any interest in them.

10. Marketing V/s Market:

Marketing is the process of trying to get group of people interested in buying

company’s products or services. It is an organizational function and a set of processes
that work all together to serve the market effectively, efficiently and profitably. It is a
set of processes for creating, communicating, and delivering value to customers and for
managing customer relationships in ways that benefit the organization and its
stakeholders.

Market is a collection of buyers and sellers. A market, is a group of people who are
willing to buy something. It is a public gathering held for buying and selling
merchandise.

5 Modern Marketing Concepts

1. The production concept

Before a business can offer a product to consumers, they must manufacture or produce
the product first. This concept is based on the philosophy the more is the production,
the less it costs for consumers and if a business can figure out how to produce a
product on a mass scale (factories), it lessens the costs for them as well. This concept
could be described as Increase profits, reduce costs.

2. The product concept

No matter how high quality a product is, the consumer essentially weighs the cost,
accessibility, and efficiency before deciding to purchase a product. If a business
produces luxury goods that are pricey, then the number of consumers willing to buy
may reduce, but the product will possibly target through niche market (targeted
customers).
3. The sales concept
Dealing with the process of actually selling a product, this concept emphasizes on
selling the product, no matter if the needs of the consumer are met or not. Following
this concept alone does not lead to long-term consumer relationships, satisfaction, or
consistent sales of a product.

4. The marketing concept

All motivations for creating a product and creating a marketing strategy to reach
potential consumers is all for meeting their wants and needs to increase their
satisfaction. This can lead to a business being the preferred choice among its
competitors due to putting the consumers’ needs first.

5. Societal marketing concept

While similar to the marketing concept in prioritizing the needs of the consumer, the
concept also urges businesses to put in mind the overall welfare of the consumer and
society as a whole. An example of this might be a business considering an eco-
friendly way of producing its products in order to reduce carbon emissions, making
the air healthier and improving breathing conditions for consumers.

What Is Consumer Buying Behavior?

Consumer Buying Behavior refers to the actions taken (both on and offline) by
consumers before buying a product or service. This process may include consulting
search engines, engaging with social media posts, or a variety of other actions. It is
valuable for businesses to understand this process because it helps them in better
searching their marketing initiatives to the marketing efforts that have successfully
influenced consumers to buy in the past.

What are the four types of buyers?

1. The Analytical Buyer - Motivated by logic and information, this buyer will look at all
the data on competing brands and products before making an informed decision.

2. The Amiable Buyer - Warm and friendly, this buyer just wants everyone to be happy.
That is why they are often paralyzed by big decisions when there is the perception of a
win/lose outcome.

3. The Driver Buyer - Drivers are most concerned with how others view them and
whether they follow. The Drivers are most concerned with their appearance rather than
the relationships that are formed during a transaction.

4. The Expressive Buyer - Relationships are key to the Expressive Buyer. They cannot
stand feeling isolated or ignored during a transaction. Instead, they want to feel like
your most important asset.
Five Steps in Buying Decision Process
There are five steps in the buying decision process:

1. Need recognition

2. Information search

3. Evaluation of alternatives

4. Purchase decision

5. Post-purchase behavior

Need Recognition Stage

Need recognition is the first step in the buyer decision process. In this step, the buyer
recognizes a need or realizes that a product or service they require is missing. They
may recognize this need either through external or internal stimuli (thinking)

Information Search Stage

Once an internal or external stimulus prompts consumers, they start collecting
information about possible solutions from various sources. Consumers also rely on
past experiences with brands while making a decision. A brand must successfully
provide its customers with all the information they want. Customers should be able to
interact with a brand - e.g. leave reviews and comments for future customers.

Evaluation of Alternatives Stage

In this step, customers evaluate their options - different companies provide ways to
meet their needs. Marketers must convince the consumer that their product is
superior to competitors'. Consumers compare the available solutions and opt for the
best one that fits their situation. This decision may be based on price, additional
features, or other product or service factors.

Purchase Decision Stage

Once the customer has all the information, they will finally decide to purchase one of
the alternatives. Two main factors influence this decision: attitudes and unexpected
situational factors.
Attitudes refer to how consumers are influenced by other consumers' opinions (e.g.,
through word-of-mouth). If someone whose opinion we value were to speak in favor
of a brand, our likeliness of purchasing from that brand will be high.

Unexpected situational factors refer to unforeseen changes in any factors that may
affect consumers' purchase decisions. These may include an unexpected price rise,
better product benefits, etc.

Post-purchase Behavior Stage

It is wrong to assume that a marketer's job is done once the customer makes a
purchase. Knowing if the customer was satisfied or dissatisfied with the purchase is
also crucial. The product or service will fail to meet the customer's expectations if the
brand promises more than what it can deliver.