1. INTRODUCTION TO
MARKETING MANAGEMENT
Chapter 1: Marketing Function
NEELA MULTANI

2. WHAT IS MARKETING?
 Marketing is identifying and meeting human and social
needs.
 In short, marketing is “meeting needs profitably.”
 Philip Kotlar, a pioneer in marketing, defined marketing
as: “Marketing is a social and managerial process by
which individuals and groups obtain what they need and
want through creating and exchanging products and
value with others.”
 The American Marketing Association defined
marketing as: “Marketing is an organizational function
and a set of processes for creating, communicating, and
delivering value to customers and for managing
customer relationship in ways that benefit the
organization and its stakeholders.

3. MARKETING MANAGEMENT
 Marketing management is the art and science of
choosing target markets and getting, keeping, and
growing customers through creating, delivering, and
communicating superior customer value.

4. OBJECTIVES OF MARKETING
 To satisfy needs, wants, and demand of consumer
and business.
 To provide value, quality and satisfactions.

5. MARKET AND MARKETERS
 A marketer is someone who seeks a response -
attention, a purchase, a vote, a donation - from another
party, called the prospect. If two parties are seeking to
sell something to each other, we call them both
marketers.
 Traditionally, A market was physical place when buyers
and sellers gathered to buy and sell goods.
 Economists describes a market as a collection of buyers
and seller who transact over a particular product or
product class (E.g. Housing market or grain market).
Modern economies abound in such markets.

6. WHAT IS MARKETED?
 Goods e.g. cars, machines, watches, cosmetics
 Services e.g. restaurants
 Events e.g. world cup, Olympics
 Experiences e.g. amusement park, water park
 Persons e.g. celebrity marketing
 Places e.g. incredible India campaign
 Properties e.g. real estate
 Organizations e.g. Philips “sense and simplicity”
campaign
 Information e.g. schools, labs
 Ideas e.g. AIDS awareness, discourage smoking

7. ENGINEERS IN MARKETING
 Technical backgrounds
 Real understanding of the properties of the product
 Understand the realities of production and design
on the product
 Helps in deciding pricing strategy

8. CHARACTERISTICS / FEATURES OF
MARKETING
 Operational
 Customer-oriented
 Overall business philosophy
 Long-term survival
 Mutual benefits
 Business objective

9. CORE MARKETING CONCEPTS
 To understand the marketing function, we need to
understand the following core set of concepts.
1. Needs, Wants, and Demands
2. Target Markets, Positioning, and Segmentation
3. Offerings and Brands
4. Value and Satisfaction
5. Marketing Channels
6. Supply Chain
7. Competition
8. Marketing Environment

10. NEEDS, WANTS AND DEMANDS
 Needs are the basic human requirements. E.g.
air, food, water, clothing, shelter
 Needs become wants when they are directed to
specific objects that might satisfy the need. Wants
are shaped by our society.
 Demands are wants for specific products backed by
an ability to pay.

11. NEEDS
 Five types of needs:
1. Stated needs (The customer wants an
inexpensive car.)
2. Real needs (The customer wants a car whose
operating cost, not its initial price, is low.)
3. Unstated needs (The customer expects good
service from the dealer.)
4. Delight needs (The consumer would like the
dealer to include an onboard navigation system.)
5. Secret needs (The customer wants friends to see
him as a savvy consumer.)

12. TARGET MARKET, POSITIONING AND SEGMENTATION
 Marketers start dividing the market into segments. They
identify distinct group of buyers by examining
demographic, psychographic, and behavioral differences
of buyers.
 After identifying market segments, the marketer then
decides which present the greatest opportunity – which
are its target market.
 For each, the firm develops a market offering that it
positions in the minds of the target buyers as delivering
some central benefit(s).
 E.g. Volvo for safety, Mahindra Scorpio luxury car (SUV)

13. OFFERING AND BRANDS
 Companies address needs by putting forth a value
proposition, a set of benefits that they offer to
customers to satisfy their needs. Offering can be a
combination of products, services, information, and
experiences.
 A brand is an offering from a known source.

14. VALUE AND SATISFACTION
 The offerings will be successful if it delivers value
and satisfaction to the target buyer.
 Value reflects the sum of the perceived tangible and
intangible benefits and costs to customers. (quality,
service, price)
 Satisfaction reflects a person’s judgments of a
product’s perceived performance (or outcome) in
relationship to expectations.

15. MARKETING CHANNELS
 To reach a target market, the marketer uses three kinds
of marketing channels.
 Communication channels deliver and receive
messages from target buyers.
E.g., newspapers, magazines, radio, television, mail, tel
ephone, posters, internet.
 The marketer uses distribution channels to
display, sell, or deliver the physical product or service(s)
to the buyer or user. They include
distributors, wholesalers, retailers, and agents.
 Service channels to carry out transactions with
potential buyers. They include
warehouses, transportation companies, banks, and
insurance companies.

16. SUPPLY CHAIN
 The supply chain is a longer channel stretching
from raw materials to components to final products
that are carried to final buyers.
 When a company acquires competitors or expands
upstream or downstream, its aim is to capture a
higher percentage of supply chain value.

17. COMPETITION
 Competition includes all the actual and potential
rival offerings and substitutes a buyer might
consider.
 E.g. car manufacturer may buy from TATA steel or
Steel authority of India (SAIL) or from abroad; or
buy aluminum for certain parts to lighten the car’s
weight.

18. MARKETING ENVIRONMENT. . .
 The marketing environment consists of the task
environment and the broad environment.
 The task environment includes the actors engaged in
producing, distributing, and promoting the offering.
These are the company, suppliers, distributors, dealers,
and the target customers.
 In the supplier group are material suppliers and service
suppliers, such as marketing research agencies,
advertising agencies, banking and insurance
companies, transportation companies and
telecommunication companies. Distributors and dealers
include agents, brokers, manufacturer representatives,
and others who facilitate finding and selling to
customers.

19. . . . MARKETING ENVIRONMENT
 The broad environment consist of six components.
1. Demographic environment
2. Economic environment
3. Physical environment
4. Technological environment
5. Political-legal environment
6. Social-cultural environment
 Marketers must pay close attention to the trends and
developments in these environments and make timely
adjustments to their marketing strategies.

20. FUNCTIONS OF MARKETING. . .
 Marketing is not something to be done just by the
marketing department. The real task of doing
marketing is delivering benefits to meet customer’s
present and future needs – is part of everyone’s
job.
 Tasks in marketing-
 Setting marketing objectives
 Developing and implementing strategic marketing
plans
 Market and environmental analysis
 Conducting marketing research

21. . . .FUNCTIONS OF MARKETING. . .
 Designing the appropriate marketing mix-
 The service product itself
 Pricing policy
 Promotion and advertising
 Distribution systems
 People-customer service and marketing training
delivery process.
 Designing the service environment
o Marketing input in sales management
o Internal communications
o Integration with other departments

22. . . .FUNCTIONS OF MARKETING
 To achieve organizational objectives.
 The primary objective of marketing is the realization of
profit through customer satisfaction.
 The important functions of marketing management are:
 Marketing research
 Sales forecasting
 Marketing mix / 4 P’s in marketing
 Advertising
 Sales promotion
 Pricing

23. MARKETING PHILOSOPHIES – EVOLUTION OF
MARKETING CONCEPTS
 Marketing philosophies explain the following
concepts.
1. The production concept
2. The product concept
3. The selling concept
4. The marketing concept
5. The societal marketing concept
6. The holistic marketing concept

24. THE PRODUCTION CONCEPT
 Oldest concept in business.
 This concept emphasizing on improving production process
and it holds that consumers will prefer to buy products that are
widely available and inexpensive.
 Managers of production-oriented business concentrate on
achieving high production efficiency, low costs, and mass
distribution. Faster delivery leads to more customers.
 This concept is also useful when a company wants to expand
the market.
 Example: The largest PC manufacture, LENOVO in China
takes advantage of the huge inexpensive labour pool to keep
costs and prices low, there by dominate the markets.

25. THE PRODUCT CONCEPT
 This concept emphasizes in product. It holds that
customers favor products that offer the most
quality, performance, or innovative features.
 Managers in these organizations focus on investing
in research process, product
development, manufacturing and engineering for
making superior products and improving them over
time.
 A new product will not necessarily be successful
unless it’s priced, distributed, advertised, and sold
properly.

26. THE SELLING CONCEPT
 The goal is to increase sales volume and it holds that
consumers and business, if left alone, won’t buy enough
of the organizations’ products.
 Organizations must undertake an aggressive selling and
promotion effort through advertisement and personal
selling.
 Also it explains How to sell the products in markets?
Organization can attract the people or customer through
providing some offers such as coupons, sales, 0%
financial charge, instalment
scheme, guaranties, warranties, sometimes provides
home delivery.

27. THE MARKETING CONCEPT. . .
 It is based on customer-centered, “sense-and-
respond” philosophy. The goal of this concept is to
address the customer needs and wants.
 It holds that the key to achieving organizational
goals is being more effective than competitors in
creating, delivering, and communicating superior
customer value to its chosen target markets.
 Manager focus on identifying customer needs
wants, and preferences and market effectively to
address those needs, wants and preferences.

28. . . . THE MARKETING CONCEPT
 Selling focuses on the needs of the seller; marketing focuses
on the needs of the buyers.
 Selling is preoccupied with the seller’s need to convert his
product into cash; marketing with the idea of satisfying the
needs of the customer by means of the product and the whole
cluster of things associated with creating, delivering and finally
consuming it.
 Companies that practices both a reactive and a proactive
marketing orientation are implementing a total market
orientation and are likely to be the most successful.
 Example: Dell computer doesn’t prepare a perfect computer
for its target market, but it provides product platforms on which
each person customizes the features he desires in the
computer.

29. THE SOCIETAL MARKETING CONCEPT. . .
 It holds that the organization’s task is to determine the
needs, wants, and interests of target markets and to
deliver the desired satisfactions more effectively and
efficiently than competitors in a way that preserves or
enhances the consumer’s and society’s long-term well-
being.
 Example: HP have introduced recyclable computers and
printers and reduced greenhouse emissions.
 The societal marketing concept calls upon marketers to
build social and ethical considerations into their
marketing practices.

30. . . . THE SOCIETAL MARKETING CONCEPT
 Companies following this concept reducing demand
for a company’s own products, if that is in best
interest of society.
 Example: Philip Morris U.S.A. advertising the
negative effects of smoking. The company has a
youth smoking prevention department headed by a
Senior Vice President; his role is to prevent youth
from starting smoking and to help smokers to give
up smoking.

31. THE HOLISTIC MARKETING CONCEPT
 This concept is based on the development, design, an
implementation of marketing programs, processes and
activities that recognizes their breadth and
interdependencies.
 Holistic marketing recognizes that “everything matter”
with marketing –and that a broad, integrated perspective
is often necessary.
 There are four broad components for characterizing
holistic marketing:
1. Relationship marketing
2. Integrated marketing
3. Internal marketing
4. Social responsibility marketing

32. Products
Senior &
management services
Marketing Other Communications Channels
department departments
Internal Integrated
marketing marketing
Holistic
marketing
Sales
Performance Relationship
revenue
marketing marketing
Brand &
customer
equity
Community
Customers Partners
Ethics Legal Channel
Environment

33. RELATIONSHIP MARKETING. . .
 Relationship marketing aims to build mutually
satisfying long-term relationships with key
constitutes in order to earn and retain their
business.
 Four key constitutes for relationship marketing are
customers, employees, marketing partners
(channels, suppliers, distributors, dealers, agencies
), and members of the financial community
(shareholders, investors, analysts).
 The ultimate outcome of relationship marketing is a
unique company asset called a marketing network.

34. . . . RELATIONSHIP MARKETING
 A marketing network consists of the company and
its supporting stakeholders – customers,
employees, suppliers, distributors, retailers, ad
agencies, university scientists, and others – with
whom it has built mutually profitable business
relationships.
 Another goal of relationship marketing is to place
much more emphasis on customer retention.
 Attracting a new customer may cost five times as
much as doing a good enough job to retain an
existing one.

35. INTEGRATED MARKETING
 Integrated marketing, the marketer’s task is to devise marketing activities
and assemble marketing programs that maximize the ability to create,
communicate, and deliver the value of customers.
 McCarthy said the marketing mix tools in terms of four Ps. Such as
Product, Price, Place, and Promotion.
 Marketing mix decisions must be made for influencing the trade channels
as well as the final customers.
 Marketing mix is a set of controllable tactical and represents the seller’s
view of marketing tools like product, price, place, and promotion
that the firm blends to produce the response it wants in the target
market.
 The market mix consists of everything the firm can do to influence the
demand for the product. The many possibilities can be collected into four
groups of variables known as the “four Ps”.

36. THE 4 P’S IN MARKETING/MARKETING MIX
 The marketing mix is the set of controllable
variables that the firm can use to influence the
buyer’s response.
 The marketing mix and 4 Ps of marketing are used
as synonyms for each other. In fact, they are not
necessarily the same things.

38. PRODUCT
 Product refers to the goods and series offered to
customers.
 The product can be subdivided into quality
levels, special features, styling, branding, product
range or mix, service back-up, warranty, durability
packaging.
 Combination of above is used for product. E.g. low
quality product backed by a high service element.

39. PRICE
 Price refers to the amount charged for the offered
product or services. The right product should be
offered at right place.
 Price is a mechanism of exchange between firm
and customer. It incorporates credit
terms, discounts, margins, resources and financial
services.

40. PROMOTION
 Promotion refers to advertising and selling part of
marketing i.e. informing potential customers of the
availability of the product, its price and place.
 Promotion includes two broad areas of advertising
and personal selling.
 Advertising – media/display/classified
 Merchandizing – promotional support for the retailer
 Personal selling – salesman is special discounts
 Publicity – press and public relations

41. PLACE
 Place refers to distribution channels used to get
your product to your customers.
 Place make the product physically available. It
includes distribution
channel, outlet, warehouse, factory
location, coverage stocks and freight.
 The essence of managing the marketing mix lies in
providing each group of customers with the mix of
product, price, place and promotion which suits
their needs.

42. LIMITATION OF FOUR P’S
 As the marketing mix comprises closely interrelated
elements, it is necessary to examine each to be
clear about their respective roles.
 Markets are dynamic and can be affected by a
range of uncontrollable environmental variables.
 Marketing has to devise strategies that take
account of these variables using available
marketing tools.

43. INTERNAL MARKETING
 Holistic marketing incorporates internal marketing, ensuring
that everyone in the organization embraces appropriate
marketing principles, especially senior management.
 Internal marketing is the task of hiring, training, and motivating
able employees who want to serve customers well.
 It takes two levels. One is the various marketing functions –
sales force, advertising, customer service, product
management, marketing research –must work together and be
coordinated from the customers point of view.
 At the second level, other departments must embrace
marketing; they must also “think customer”. In fact, marketing
thinking must be pervasive throughout the company.

44. PERFORMANCE MARKETING (SOCIAL
RESPONSIBILITY MARKETING)
 Understand the ethical, environmental, legal and social context of
marketing activities and programs. Social responsibility deals with social
problems and involving in social welfare.
 It holds that the organizations tasks is to determine the needs wants and
interests of target markets and to delivers the desired satisfaction to both
consumer and society effectively than competitors.
 The societal marketing concept calls upon marketers to build social and
ethical considerations into their marketing practices.
 Manager focus on identifying customer needs, wants, preferences and
marketing analysis like efficiency.
 Yet a number of companies, including Ben & Jerry’s have achieved
notable sales and profit by adopting and practicing a form of the societal
marketing concept called cause –related marketing.
 It is an opportunity to enhance their corporate reputation, raise brand
awareness, increase customer loyalty, build sales, and increase media
coverage.

45. THANK YOU