Asst. Prof.

Manasi Patel
Introduction to Marketing

CHAPTER-1

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Topics in Module 1

Marketing Management Marketing Environment

• Introduction • Introduction
• Objectives • Environmental Scanning
• Scope and Importance • Techniques of Environment
• Types of Market Scanning
• Core Concepts of Marketing • Analyzing the Organization’s
• Functions of Marketing Microenvironment
• Marketing Orientations • Company’s Macro Environment
• Differences between Micro and
Macro Environment
• Marketing Planning and
Implementation
• Marketing Management is an
organizational discipline, which
deals with the practical
application of marketing
orientation, techniques and
methods in enterprises and
organizations and with the
management of a company's
marketing resources and
activities.
Need , Want & Demand
• Needs are the essential things to
fulfill the states of deprivation for our
survival. Needs can be basically
divided into Physical Needs, Social
Needs, and Individual Needs.

• Physical needs include the basic

human requirements such as air for
breathing, food, water, clothing, and
shelter.

• Social needs are the requirement

for belongings and affection from
friends and family.

• Individual needs can be varied

depending on each person’s
perception, knowledge, and
environment.
 Need , Want & Demand

• Wants are directed by

our surrounding towards
reaching certain needs.
Therefore human’s wants
can be varied depending
on each individual’s
perception, environment,
culture, and society.
Need , Want & Demand
Needs or Wants turn to be Demands when a customer is willing and having
the ability to buy that needs or wants.
Meaning of Marketing

Human

Need
Satisfy Wants
Demand

Create
Communicate Product
Deliver

Manufacturer
Organization
Definition of marketing

• According to Philip Kotler, “Marketing is

the science and art of exploring, creating,
and delivering value to satisfy the needs of
a target market at a profit. Marketing
identifies unfulfilled needs and desires. It
defines, measures, and quantifies the size
of the identified market and the profit
potential. It pinpoints which segments the
company is capable of serving best and it
designs and promotes the appropriate
products and services.”

• Another definition by Philip Kotler is

“The Marketing concept is a customer
orientation backed by integrated
marketing aimed at generating customer
satisfaction as the key to satisfying
organizational goals”.
Objectives of Marketing

• To satisfy the clients’ requirements and their

objectives.

• To leverage the gain for the growth of business.

• To develop customer base for the business.

• To create an appropriate marketing mix.

• To raise the quality of life of people.

• To build a good image of the organization.

• To maintain the long-run concept.

 2. Marketing
Scope of Marketing
1. New Product
Officials

3. Setting 4. Decision
Marketing Goals Making

5. Price Setting
Importance of Marketing
(a) Creation of demand for goods and services

(b) Betterment in the standard of living

(c) Creation of social utility

(d) Special benefit to developing countries

(e) Maintenance of survival and mobility of business

(f) Sense of security

(g) Maintenance of balance between demand and supply

(h) Means of living,

(i) Export promotion

(j) Sales promotion

(k) Increase in the risk bearing capacity.

 A set up where two or more
parties engage in exchange of
goods, services and information
is called a market. Ideally a
market is a place where two or

What is a
more parties are involved in
buying and selling.

Market
The two parties
involved in a
transaction are
called seller and
buyer.
Types of Markets

• Physical Markets - Physical market is a

set up where buyers can physically meet
the sellers and purchase the desired
merchandise from them in exchange of
money. Shopping malls, department
stores, retail stores are examples of
physical markets.

• Non Physical Markets/Virtual markets -

In such markets, buyers purchase goods
and services through internet. In such a
market the buyers and sellers do not meet
or interact physically, instead the
transaction is done through internet.
Examples - Rediff shopping, eBay etc.
• Auction Market - In an
auction market the seller
sells his goods to one who
is the highest bidder

• Market for Intermediate

Goods - Such markets sell
raw materials (goods)
required for the final
production of other goods.
• Black Market - A black
market is a setup where illegal
goods like drugs and weapons
are sold.

• Knowledge Market -
Knowledge market is a set up
which deals in the exchange of
information and knowledge
based products.

• Financial Market - Market

dealing with the exchange of
liquid assets (money) is called a
financial market.
Core Concepts of Marketing
Core concepts of marketing are the essential elements that
make the whole marketing system complete. They are the
essence to make a proper marketing system.

Need, Want, and Demand

Product, Service, and Experience

Market

Exchange, Transaction, and Relationship

Customer Value and Satisfaction

Functions of Marketing

Selling Buying and Transportation Storage

assembling

Standardization Financing Risk-Taking Market

and Grading Information
Market Orientation in Marketing Management

• The marketing orientation concept has

evolved, and for decades, it has been the model
of choice for businesses looking to establish
brands that can compete for customer
attention and loyalty. Businesses have had to
adapt to new marketing strategies to survive
the current market, like the shift from
traditional to digital marketing.
• Marketing orientation can be categorized
into five key groups. These are:

• Production orientation
• Product orientation
• Sales orientation
• Societal orientation
• Market orientation

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Production Orientation
• A management philosophy, concept, focus or
state of mind which emphasises production
techniques and unit-cost reduction rather than
the needs and wants of the target market; the
orientation assumes that consumers will
favour those products that are the most
readily available and at the most affordable
prices and that a concentration on efficiencies
in production and distribution will most readily
achieve the firm's objectives.

• One notable production orientation example

is fast food restaurant chains such as Burger
King and McDonald's, which focus on making
thousands of burgers a day at a cheap price.
Product Orientation Definition
• Product orientation is a marketing
management concept that emphasizes
the promotion of high-quality items to
increase sales. The corporation
considers product quality to be a
determinant of market demand. A
product-oriented corporation focuses
on creating high-quality articles and
pricing them appropriately so that
customers can recognize and acquire
the company’s products.

• Apple can be labelled as a product-

oriented company. Apple focuses on its
quality and relies on innovation to
enter new markets and create demand.
Sales orientation
• Sales orientation is a selling approach used
by companies to persuade customers to buy
products and services produced by them.
These companies generate their profits by
satisfying customers to buy their products
and don’t care about the needs of the
customers.
• These companies put a high emphasis
on advertising and marketing rather than
improving the quality of the products. They
make sure that their sales force has all the
abilities that are required to sell products.
The importance of the product and
production capacity is more than the
customers.

• Walmart is a great example of a sales

oriented company. Walmart heavily
advertised how they're known for having the
lowest prices. Through low prices they were
able to gain and retain their customer base.
Societal marketing
• Societal Marketing orientation is a
business philosophy that holds that
companies should market their
products and services in a way that is
beneficial to society. This means that
businesses should take into account the
social and environmental impact of
their marketing activities, and make
sure that they are doing more good
than harm.
• A good example of societal marketing
orientation company is Tesla. Tesla's
mission is not simply to make money
but to change the world by making
sustainable energy affordable and
accessible to everyone
Market Orientation
• Market orientation is an
approach to business that
prioritizes identifying the needs
and desires of consumers and
creating products and services
that satisfy them. Companies
that have a market orientation
consider the opinions and This Photo by Unknown Author is licensed under CC BY

needs of their target market as

a critical component of This Photo by Unknown Author is licensed under CC BY

their research and

development (R&D) for new
products.
• Amazon is an example of a
market-oriented company. As it
has grown and developed, it has
consistently added processes
and features that clearly This Photo by Unknown Author is licensed under CC BY-SA

address concerns and desires

expressed by consumers.
Introduction Marketing Environment

The marketing environment refers to all internal and external factors, which
directly or indirectly influence the organization’s decisions related to
marketing activities. Internal factors are within the control of an organization,
whereas external factors do not fall within its control. The external factors
include government, technological, economical, social, and competitive forces;
whereas organization’s strengths, weaknesses, and competencies form the
part of internal factors. Marketers try to predict the changes, which might take
place in future, by monitoring the marketing environment. These changes may
create threats and opportunities for the business. With these changes,
marketers continue to modify their strategies and plans. A marketing
environment mostly comprises of the following types of environments:
1. Micro Environment
2. Macro Environment
Factors
affecting
Micro
Environment
Factors
affecting
Maco
Environment
Environmental Scanning in Marketing

Environmental scanning involves reviewing

external sources and factors that impact the
internal operations of a business. Its purpose is
to identify potential sources to consult with or
consider when making business decisions. Those
involved in the decision-making process,
including company leaders and executives, use it
to understand issues that might impact the
business overall. Examples of issues that could
impact the success of an organization include the
actions taken by competitors, the political
landscape, regulatory changes and the overall
environment in which the business operates.
Techniques of
Environmental
Scanning

The main
techniques of
environmental
scanning are as
follows –

• SWOT Analysis
• PEST Analysis
• ETOP
• QUEST
 • SWOT analysis is a versatile tool and can
be applied to various situations, including
business planning, project management,
and personal development. It provides a
structured framework for evaluating the
internal and external factors that can
impact an entity's success.
SWOT • The process of conducting a SWOT
analysis typically involves gathering data
Analysis and information about each of the four
categories. This information can be
collected through internal assessments,
external market research, surveys, and
feedback from employees and stakeholders.
Once the analysis is complete, organizations
can use it to inform their strategic planning
and decision-making processes.
Strengths: These are internal attributes and resources that give an organization a

competitive advantage. Identifying strengths helps organizations understand what

they do well and can leverage to achieve their goals. Examples of strengths might

include a strong brand reputation, skilled employees, innovative products, or

efficient processes.

Weaknesses: These are internal factors that hinder an organization's ability to

achieve its objectives. Identifying weaknesses is crucial for addressing areas that

need improvement. Weaknesses might include outdated technology, a lack of skilled

personnel, high production costs, or a poor reputation in a specific area.

Opportunities: These are external factors or trends in the market that an
organization can exploit to its advantage. Identifying opportunities helps
organizations understand how they can grow or expand their operations.
Opportunities might include emerging markets, changes in consumer
behavior, technological advancements, or new partnerships.

Threats: These are external factors or trends that could negatively impact an
organization's performance. Identifying threats allows organizations to
develop strategies to mitigate risks. Threats might include increased
competition, economic downturns, regulatory changes, natural disasters, or
shifts in consumer preferences.
PESTLE Analysis
A PESTLE analysis, also known as PESTEL analysis or PEST analysis, is a strategic
tool used by organizations to assess and analyze the external macro-environmental
factors that can impact their operations. The acronym PESTLE stands for Political,
Economic, Social, Technological, Legal, and Environmental factors.
Organizations conduct PESTLE analyses to gain a comprehensive understanding of the
external factors that could impact their strategic decisions, performance, and long-
term viability. By identifying and analyzing these factors, organizations can better
adapt to changes in their environment, capitalize on opportunities, and mitigate risks
and threats.
PESTLE analysis is often used in conjunction with SWOT analysis to create a more
complete picture of an organization's internal and external strategic considerations.
Together, these analyses help guide strategic planning, risk assessment, and decision-
making processes.
QUEST Analysis
Quick Environment Scanning Technique

The QUEST Analysis, or “Quick environmental scanning

Technique,” describes a procedure that allows for the
estimation of diverse environmental variables and evaluates
their impact on an organization. It attempts to analyze the
forces of nature by analyzing the impact of developments
and patterns that are occurring in the market
ETOP

ETOP stands for the term Environmental Threat and Opportunity

Profile. Environmental factors can be quite complex, and it can be
difficult to classify them into proper categories. This is where ETOP
comes in. It divides the environment into different sectors and
analyses the threat and impact of each sector. The process by which
organizations monitor their relevant environment to find
opportunities and threats affecting their business to make strategic
decisions is known as ETOP analysis.
Each sector and sub-effects sector of the organisation is examined
by ETOP. As an established company in this industry, GE Oil & Gas,
for instance, must scan the environment from an industry
perspective: The upstream, midstream, and downstream sectors
make up the O&NG industry. There is a need for ETOP due to the
following factors:

• It aids organizations in identifying threats and opportunities.

• To bolster the position of organizations and consolidate.
• Informs the strategists of the industries that will benefit the
organisation.
• Assist an organisation in understanding its position with regard
to its environment.
• Aids in developing a suitable strategy.
• Assists in creating a SWOT (Strategic Weakness Opportunities
and Threats) analysis.
 Aspect Micro Environment Macro Environment
Broader and encompasses external
Close and specific to the
Scope factors beyond the organization's
organization.
control.
Concerned with factors
directly affecting the
Focuses on external factors that can
Focus organization's day-to-day
impact the entire industry or market.
operations and decision-
making.
Elements are close and have Elements are typically distant and may
Proximity immediate relevance to the not have immediate impact but are
organization. important for long-term planning.
Factors are within the
Factors are largely uncontrollable and
Controllability organization's control or can
require adaptation strategies.
be influenced directly.
Short-term perspective,
Long-term perspective, considering
Time Horizon focusing on the current
trends and potential future changes.
business environment.
- Economic conditions (e.g., inflation,
- Customers and clients. - recession). - Technological
Suppliers. - Competitors. - advancements. - Political and legal
Examples
Distributors. - Employees. - factors. - Socio-cultural trends. -
Regulatory agencies. Environmental factors. - Market
demographics.
Directly influences day-to-day Shapes long-term strategic planning,
Influence on Strategy decisions, marketing tactics, market entry, and product development
and customer relationships. strategies.
Requires frequent
Calls for scenario planning and risk
adjustments and adaptations
Adaptation Strategies mitigation strategies to prepare for
to respond to changing
potential disruptions.
circumstances.
Focuses on building strong
May involve industry collaboration and
Stakeholder relationships with key
advocacy to influence broader industry
Engagement stakeholders in the
trends.
immediate environment.