Marketing - Definition & Importance, Concepts & Marketing Management Tasks

Chapter 1
Marketing: Definition & Importance
All activities involved in creation of time, place and
possession utilities.
The process of Planning & Executing the conception,
pricing, promotion and distribution of ideas, goods
and services to create exchanges that satisfy individual
and organizational objectives.
American Marketing Association

The management process responsible for identifying,
anticipating and satisfying customer requirements
profitably.
Chartered Institute of Marketing

Chapter 1
- Market vs Marketing
Market is an arrangement to provide an opportunity to exchange goods.
Marketing is sum total of all those activities that are related to flow of goods
from production to consumption.

- Marketing, Selling & Merchandizing
Marketing is a broader concept which is driven from customer’s demand.

Selling is one part of marketing which deals with persuading customers to
buy products that are available with seller.
Merchandizing refers to the process offering a variety of products to a retail
consumer in a manner which stimulates demand.

Chapter 1
IMPORTANCE OF MARKETING
1. Marketing helps to achieve, maintain and raise
the standards of living
-

Marketing is means through which production and
purchasing power are converted into consumption.

-

Better marketing  Mass production

-

Mass production  Low cost

-

Low cost  More buying power  Higher standard
of living

Chapter 1
2. Marketing Increases employment opportunities
-

Marketing involves various functions / subfunctions (Buying, Selling, Transport, Warehousing,
Financing, Risk management etc)

-

These functions create need for different
specializations

-

About 30-40% population depends directly or
indirectly on marketing

Chapter 1
3. Marketing increases national income
-

More purchasing power  increase in national
income

4. Helps maintain economic stability &
development
-

By maintaining demand supply balance

Chapter 1
5. Link between producer & consumer

6. Removes imbalance of supply & demand by
transferring surpluses
7. Helps create utilities of time, place &
possession

Chapter 1
IMPORTANCE OF MARKETING – Business Firms
1. Marketing Generates Revenue, by generating
sales & thereby profits
2. Marketing helps decision making process (what,
when & how much to produce, store or
transport)
3. Helps change management & innovations

Chapter 2
Marketing Concepts
1. Exchange Concept
-

Exchange is only a small part of the total marketing
process.

-

Other parts of marketing like customer orientation,
satisfaction, value creation, creative selling etc are
not covered

Chapter 2
Marketing Concepts
2. Production Concept
-

Production in large volume, at low cost will be
acceptable to customers

-

Concentrates on production efficiency

-

May do well in distribution

-

Rarely appreciated by customers

Chapter 2
Marketing Concepts
3. Product Concept
-

Focuses on design and quality of products

-

Believes that customers will automatically buy
products of high quality

-

R&D is essential element

-

Do not bother to study the market & consumer in
depth

Chapter 2
Marketing Concepts
4. Sales Concept
-

Believes that customers need to be persuaded to
buy the products

-

Involves advertising, large scale promotions,
publicity, discounts, public relations etc.

-

Does not take care of the need of the customer

Chapter 2
Marketing Concepts
Sales v/s Marketing
Marketing
determine future needs and has a
Approach strategy in place to meet those needs
for the long term relationship.

Sales
makes customer demand match the
products the company currently
offers.

fulfill customer's wants and needs thru
Focus products and/or services the company fulfill sales volume objectives
can offer.
Horizon Longer term

Short term

Once a product has been created for
Identifying customer needs (research),
a customer need, persuade the
Scope creating products to meet those needs,
customer to purchase the product to
promotions to advertise said products.
fulfill her needs

Chapter 2
Marketing Concepts
Sales v/s Marketing
Marketing

Sales

Strategypull

push

ConceptMarketing is a wider concept

Sales is a narrower concept

Marketing shows how to reach to
Priority the Customers and build long
lasting relationship

Selling is the ultimate result of
marketing.

Sales is the strategy of meeting
needs in an opportunistic,
Marketing targets the construction individual method, driven by
of a brand identity so that it
human interaction. There's no
Identity
becomes easily associated with need premise of brand identity,
fulfillment.
longevity or continuity. It's simply
the ability to meet a need at the
right time.

Chapter 2
Marketing Concepts
5. Marketing Concept
-

Starts with determination of consumer needs

-

Ends with satisfaction of these needs

-

Organizational activities revolve around customer

-

Products & Services are designed to serve customer
needs

-

Satisfied customer will only produce profits

Chapter 2
Marketing Concepts
Features of Marketing Concept
1. Consumer Orientation

2. Integrated management action
3. Consumer Satisfaction
4. Realizing organizational goals including profits

Chapter 2
Marketing Concepts
Benefits of Marketing Concept
1. Long Term success

2. Faster penetration
3. Better Products
4. Boosts creativity

5. Integrated functions
6. Mostly in profits
7. Better growth of employees

8. Contributes to overall growth of the society

Chapter 2
Marketing Concepts
Dilemma of Marketing Concept
1. Customer Orientation v/s Product standardization

2. Customer Orientation v/s Profits
3. May ignore social welfare at times
4. Constrains innovation, at times

Chapter 3
Marketing Management Tasks
Responsibilities of Marketing Management
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.

Market analysis
Set Goals
Forecast sales & profits
Strategies, policies & procedures
Evolve appropriate marketing mix
Organize marketing activities
Organize resources
Participation in product planning
Managing Supply chain
After Sales activities

Chapter 3
1. Conversional Marketing
-

Used during negative demand

-

Customer dislikes the product

-

May even pay to avoid the product

-

It is a rare condition

-

e.g. Waste Water

Chapter 3
2. Stimulational Marketing
-

Used during No demand

-

Customer is indifferent to the product

-

Task of converting no-demand into positive demand

-

Connect the product with existing need

-

Create environment where need is felt

-

e.g. Mushrooms

Chapter 3
3. Developmental Marketing
-

Used during Latent demand

-

Consumers share need for something which does not
exist

-

Opportunity for Marketer to develop a product

-

e.g. Electronic cigarette

Chapter 3
4. Remarketing
-

Used during fading demand

-

Consumers find either no use for the product or better
alternatives in the market

-

Marketers recreate the demand

-

e.g. Cinema halls

Chapter 3
5. Synchro Marketing
-

Used during irregular demand

-

Seasonal products

-

Results in wasteful underutilization of production
capacity

-

Marketers attempt to streamline the demand to meet
supply capacity

-

e.g. Hotels at hill stations, flight tickets during peak
season

Chapter 3
6. Maintenance Marketing
-

Used during robust demand

-

Established products

-

Does not need efforts to push supplies

-

Keep a watch on competition

-

Keep sharpening the saw

Chapter 3
7. Demarketing
-

Used during overfull demand

-

Or when you want to exit certain business

-

Supply falls short of demand

-

Marketers discourage customers in choosing certain
products

Chapter 3
8. Counter Marketing
-

Used when demand is considered unwholesome

-

Like alcohol, drugs

-

Marketers try to destroy demand

Marketing - Definition & Importance, Concepts & Marketing Management Tasks

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