Chapter 1 Introduction To Marketing

Chapter 1
Introduction to Marketing
ADipraj Kayastha
Learning Resource by
S K Lamichhane, Faculty Member
Global College of Management
This material is for the exclusive use of Biraj Ghimire at Global College of Management
Inside this chapter – 10 LH
Meaning, basic concepts & definition of marketing
Business-oriented definitions of marketing
Emerging concepts in marketing
Marketing Mix
Implication of Marketing Mix

Activity
What do you What do you think What do you want

already know this topic is about? to learn from this
about Marketing? Chapter?
This material is for the exclusive use of Biraj Ghimire at Global College
Theorizing Marketing
Marketing is the process of creating, communicating and
delivering value building strong profitable, sustainable and
satisfying customer relationship
Marketing is identifying customer needs and wants, designing

right products and services and satisfying the customers for a
long term relational benefit.
4
Theorizing Marketing
Marketing is the process of creating, communicating and
delivering value building strong profitable, sustainable and
satisfying customer relationship
Marketing is identifying customer needs and wants, designing

right products and services and satisfying the customers for a
long term relational benefit.
5
Scholars’ definition
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 other (Kotler,
2016).
Marketing is the process of planning and executing
conception, pricing, promotion, and distribution of ideas,
goods, and services to create exchanges that satisfy individual
and organizational objectives (AMA, 2004).
Marketing is the activity, set of institutions, and processes for
creating, communicating, delivering, and exchanging offerings
that have value for customers, clients, partners, and society at 6
Inside definitions
•Broader than personal selling
•Right products services  Creating value
•Customer satisfaction
•Acquire, enhance, retain customers
•Long term benefit
•Society & stakeholders
•Communicating value  Promotions
•Delivering value  Distribution 7
What is Marketed?
Goods
Services
Events & Experiences
Persons
Places & Properties
Organizations
Information
Ideas
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Mktg Mgmt
Core Marketing Concepts
Needs, Wants, and Demands
• Needs: State of felt deprivation including physical,
social, and individual needs.
• Wants: Form that a human need takes, as shaped by
culture and individual personality.
• Demands: Wants supported Buying Power
• Product: Anything offered in market to satisfy
human needs (product, service, experience)
• Market: Pool of actual & potential customers having
similar needs & wants
9
This material is for the exclusive use of BirajMktg Mgmt
Ghimire at Global College
• Offering and Brands
– Value proposition: a set of benefits they offer to customers to satisfy their
needs
– Brand: is an offering from a known source
• Value and Satisfaction
– Successful if it delivers value and satisfaction to the target buyer
– Value is a central marketing concept
– Satisfaction reflects a person’s judgment of a product’s perceived
performance
• Marketing Channels
– Communication channels; Distribution channels; Service channels; Supply
Chain
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• Competition
– All the actual and potential rival offerings and substitutes a buyer might
consider
• Marketing environment
– Task environment
• Actors engaged in producing, distributing, and promoting the offerings
• The company; suppliers; distributors; dealers; and the target
customers
– Broad environment:
• Demographic; Economic; Physical; Technological; Political-Legal;
Social-cultural
11
MKT Segmentation: Dividing market into smaller groups of
customers who have distinct needs, characteristics, behavior
Product Positioning: Development of favorable image in minds

of customers compared to competitors
Target Market: is a marketplace where customer needs best

matches w/ company resources
12
The New Marketing Realities
"The marketplace is not what it used to be."
• Major forces that are affecting today’s Marketing:

A. Network information technology (development of ICT)
B. Globalization (going global)
C. Deregulation (more freedom to business community)
D. Privatization (very few govt. enterprises and reducing)
E. Heightened Competition (Many players, easy entry)
F. Industry Convergence (having few major player in the market)
G. Consumer Resistance (more information to customers)
H. Retail Transformation (power of retailer)
I. Disintermediation (direct to customer thru non-traditional way)
13
The New Marketing Realities
• New Consumer Capabilities
A.A substantial increase in buying power
B.Greater variety of goods and services
C.Great deal of information available
D.Greater ease in interacting and placing orders
E.Ability to compare notes on products and services
F. Amplified voice to influence peer and public opinion
• New Company Capabilities
A. Internet
B. Research
C. Speed of internal information
D. Speed of external information “buzz’
E. Better target marketing
F. Mobile marketing
G.Differentiated goods
H. Improved purchasing, recruiting, training, and communications
14
Importance of Marketing
Organization Customer Economy
● Basis for existence
● Creation of utilities ● Employment
● Source of revenue ● Maintains demand &
● Information
● Basis for planning & supply
● Satisfaction
decision
● Gears economic
● Creates innovation & ● Supports selection
growth
change ● Upgrade in living
● Product distribution standard
● Adaptation
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1. Production concept Assumption
consumers buy the products which are widespread in the market
and are affordable, low priced or cost effective
Focus
Tools
Mass production Low priced product,
(efficiency) Mass distribution
Required Goal
A production premise Earn profit through

efficiency in production
Orgns., implement this strategy to expand the market
2. Product concept Assumption
Consumers prefer products which are higher in quality among available
brands. So enhance product/service quality rather than price or affordability.
Quality products should be priced, distributed, advertised and sold properly.
Focus Tools
High quality, Innovative

Produce qualitative
products, performance
products guarantee/assurance, features
Required Goal
A production premise/factory Earn profit through

innovation and quality
3. Selling concept Assumption
because of repeated exposure with advertisement, consumers will
buy products even if they are not necessary or required. Works well
for the unsought products like insurance.
Tools
Focus
Aggressive selling, heavy
Produce whatever sellers promotion, promotional
efficiency by advertisement,
intends to make sales conversion
Required Goal
A production premise/factory Earn profit through high

volume sales
4. Modern Marketing Concept Assumption
considers customer’s needs, desire, wants, behavior and

perception. Build right and fit products for the targeted
customers. Tools
Focus
Integrated marketing
Address customer needs (communication) and inter
& wants (functional needs, departmental coordination
biogenic needs, psychogenic needs,…)
Required Goal
A target market (Mass, Earn profit by satisfying

concentrated, segmented, niche)
target customers. Utilize profit for
business expansion, growth & survival
5. Societal marketing concept
•Assumptions
keep balance between customer satisfaction
as well as long-run benefit of the society
the cost associated to recover hazard
associated with business activities like
pollution, resource depletion
consumers prefer the organizations that are willing to
show concern for their needs while giving emphasis to
long-term benefit of the society
21
Contd…
Requirement: market or targeted social group or beneficial
group
Focus: Social needs of the targeted customers
Tools: Act of socially acceptable marketing to protect, promote, support,

enhance, and preserve needs of society (environment) as well as the customers
(people)
Goal: Earn profit by satisfying needs of targeted customers and

delivering benefit to the society 22
Under this concept
•Deficient products have no long run as well as short run benefit like
gutkha. Hence they should not be produced.
• Pleasing products have immediate satisfaction but no long run benefit like
junk food, alcohol, pan masala, vape, e- cigarette they should be modified
for the lesser harm in the physical, mental health and environmental hazard.
•Salutary Product only give term satisfaction but have a long run benefit for
the society form an example: seat belt, air bags, soybean chips, organic tea
so they should be promoted
•Desirable product has both immediate satisfaction and long run benefit so
they should be produced as well.
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5. Holistic Marketing
Assumptions
For marketing success different aspects of
doing business should act as a single or
unified unit.
create positive and unified brand image and
deliver superior customer experience
conceptualizing, developing and implementing marketing

programs incorporating breadth and interdependence in terms of
a common goal, aligned activities and integrated activities
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25
5a) Internal marketing
•employees are treated as internal customers who then go
on to add value
•Core idea of internal marketing is to include dimensions of
internal operations with the marketing plans
implementation and execution
•Requires training, empowerment, teamwork, performance
appraisal, reward management, employee retention,
providing right tools & technology
26
5b) Integrated marketing
•product design, service delivery, sales, pricing, distribution, and
promotion should go hand-in-hand
•brand communication should be consistent among all departments
•all communication (advertising, sales promotion, direct marketing,
public relations, and digital marketing) in unified manner to give a
strong and focused brand image
•Businesses work towards making marketing decisions that create value
for stakeholders through a clear, concise marketing message
•ensure the company's customers and key stakeholders (internal &
external) have the same experience perception of the company
27
5c) Relationship marketing
•is based on maintaining long term, mutually satisfying relationship
with customers, channel partners, facilitating institutions and
stakeholders to enhance and retain the business
•Organizations should ensure the returns to all of these principal

stakeholders
•To develop the enduring relationships the organization should

understand their capacity, roles, needs, wants, motivation and desire.
28
5 d) Performance/Socially responsible marketing
•is focused around ensuring financial and non-financial
benefits (social benefits) or returns to business and society
from the marketing plans and programs.
•The dimension of performance marketing is enhancing

sales revenue, brand and customer equity, ethics,
environment, legal aspects, society.
Emerging concepts in
marketing
•Direct marketing
•Relationship marketing
•Green marketing
•Quality marketing
•E-marketing
Direct Maketing
•process of approaching directly with carefully targeted
pool of customers without the use of middlemen or
retailer
•implemented to seed response from the carefully chosen
pool of customers
•involves reaching customers through data analysis and
conducting Recency, Frequency and Monetary Analysis
(RFM Analysis).
DM features
•customer orientation,
•no middlemen,
•direct channel to communicate,
•direct interaction with targeted customers
•customized message for targeted customers.
Methods of DM
•Direct mail
•Direct selling
•Catalog marketing
•Telemarketing
•Televised shopping
•Kiosk marketing
Quality marketing
•Quality is the combination of qualitative (measurable) and non-
measurable features that helps to meet the needs of the consumers
•Quality marketing is the process of enhancing overall quality of
the products and services through continuous improvement and
everyone’s involvement.
•designing right products and services through continuous
improvement of production process, people, business process,
supply chain, customer services process and relationship
management process
34
Quality marketing
•Tools to maintain the quality is quality assurance, quality
improvement quality planning, quality control and statistical
quality control
•Quality also means meeting the needs and expectation of
consumers by continuous improvement, development on product
design, people, business process, value delivery process, customer
serving process
•As per ISO 9000 concept quality is the degree to which a set of
inherent qualitative and quantitate characters of the products fulfill
the requirement or expectation of consumer
35
Quality marketing
•requirements for quality marketing are: commitment,
customer orientation, everyone’s involvement, team
work, quality materials, production methods
•tools to implement quality market can be that of
customer’s feedback, training employees, quality
benchmarking (internal and external), relationship
management, continuous improvement and On-Time-
Delivery (OTD).
36
E-Marketing
•buying and selling products and services over electronic systems and
across digital touch points, primarily the internet
•Practically, e-marketing or internet marketing is implemented as

online selling companies, pure click companies (i. e only website
without physical store) and brick and click companies (both the
website and physical stores).
•
•Levels of e-marketing are Business to Business, Business to
Relationship Marketing
•customer relationship management (CRM) strategy to
develop lasting connection to the brand
•induce repeat customer, repeat purchases and generate a
positive and favorable word of mouth
•based on a premise to satisfy overall stakeholders and
developing sustainable relationship with customers,
suppliers, marketing intermediaries, government and
society.
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39
40
RM approach
•Basic marketing
•Reactive marketing :is marketing your product or service in the places
where people are already actively looking.
•Proactive marketing: is a form of marketing that allows for marketers
to be agile, real-time, data-driven, and adaptable to the ever-changing
space of what their customers could be seeking.
•Accountable marketing
•Add financial benefit
•Add structural ties
•Add social benefits
41
Green marketing
•creating, communicating and delivering values to the customers
with the special emphasis on environmental protection
•implement eco-friendly marketing, sustainable marketing and
adopting the Life Style of Health and Sustainability (LOHAS).
The LOHAS are the specific group of demography who are
willing to consume products for environmental benefit
•product the products and services that are believed to be
environmentally safe.
42
Green marketing strategy
•product modification
• low carbon footprint
• low carbon emission
• responsible packaging
•care for the natural world
• communicating green benefit
• responsible energy consumption
• reduce plastic pollution
• enhance life on land and water
43
Green marketing example
• This also makes the brand distinct, for an example handmade,
pashmina label, organic level and responsible labor label on
Dilmah Green tea.
• Ethical finance i.e. without exploitation of labor and
migrants, Banking without using money earned from
terrorism,
• ethically produced tea, Jungle Safari without riding elephant,
• no animals being hurt or killed during making of the movie.
44
Green marketing 4ps
•Green promotion is communicating green benefits to the
customers
•Green placement is the process of eco-friendly packaging, eco-
friendly labeling and eco-friendly shipping
•Green marketing has emerged out of governmental regulation
and exploring new niche for the LOHAS (lifestyle of health and
sustainability) and to gain that sustainable competitive
advantage
•Reasonably pricing the products compared to benefits
45
Green marketing evolution
• Ecological Marketing
• Environmental Marketing
• Sustainable Marketing
46
Marketing Mix
•Product
•Price
•Promotion
•Distribution
•People
•Process
•Physical evidence
Modern Marketing
• People
• Process (planning and decision making)
• Program (old 4Ps)
• Performance (financial and non financial)
48
4Ps 4As SIVA
Product Acceptability Solution
Price Affordability Value
Place Accessibility Access
Promotion Awareness Information
49
Product mix
• Product design – features, quality
• Product assortment – product range, product mix, product
lines
• Branding
• Packaging and labeling
• Services (complementary service, after-sales service, service
level)
• Guarantees and warranties
• Returns 50
Price mix
• Price strategy
• Price tactics
• Price-setting
• Allowances – e.g. rebates for distributors
• Discounts – for customers
• Payment terms – credit, payment methods
• Customer’s perceived value
• Differentiation
51
Promotion mix
• Advertisement
• Sales Promotion
• Personal Selling
• Public Relations
• Publicity
• Direct Marketing
• Message strategy - what is to be communicated
• Channel/ media strategy - how to reach the target audience
• Message Frequency - how often to communicate
52
Distribution mix
• Mode of distribution: intensive distribution, selective
distribution, exclusive distribution, franchising .
• An intensive distribution strategy involves selling a product in

as many outlets as possible. Selective distribution involves
selling a product at select outlets in specific locations.
Exclusive distribution involves selling a product through one
or very few outlets.
53
• Market coverage: Product Specialization, Market
Specialization, Single Coverage, Full Coverage
• Channel member selection and channel member relationships
• Assortment
• Location decisions
• Inventory
• Transport, warehousing and logistics
54
People mix
• Staff recruitment and • Discretion
training
• Uniforms
• Incentive
• Scripting
management
• Queuing systems, • Appearance
managing waits • Interpersonal
• Handling complaints, behavior
service failures • Attitudes
• Managing social • Degree of
interactions
involvement
• Training
• Customer contact 55
Process mix
• Process design
• Blueprinting (i.e. flowcharting) service processes
• Standardization vs customization decisions
• Diagnosing fail-points, critical incidents and system failures
• Monitoring and tracking service performance
• Analysis of resource requirements and allocation
• Creation and measurement of key performance indicators (KPIs)
• Alignment with Best Practices
• Preparation of operations manuals
56
Physical evidence mix
• Facilities (e.g. furniture, equipment, access)
• Spatial layout (e.g. functionality, efficiency)
• Signage (e.g. directional signage, symbols, other
signage)
• Interior design (e.g. furniture, color schemes)
• Ambient conditions (e.g. noise, air, temperature)
• Design of livery (e.g. stationery, brochures, menus,
etc.) 57
Functions of Marketing
58
• Process of Marketing
59

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Chapter 1

Business-oriented definitions of marketing

Emerging concepts in marketing

Implication of Marketing Mix

What do you What do you think What do you want

Marketing is identifying customer needs and wants, designing

Marketing is identifying customer needs and wants, designing

Events & Experiences

Places & Properties

Product Positioning: Development of favorable image in minds

Target Market: is a marketplace where customer needs best

• Major forces that are affecting today’s Marketing:

A production premise Earn profit through

High quality, Innovative

A production premise/factory Earn profit through

A production premise/factory Earn profit through high

considers customer’s needs, desire, wants, behavior and

A target market (Mass, Earn profit by satisfying

Tools: Act of socially acceptable marketing to protect, promote, support,

Goal: Earn profit by satisfying needs of targeted customers and

conceptualizing, developing and implementing marketing

•Organizations should ensure the returns to all of these principal

•To develop the enduring relationships the organization should

•The dimension of performance marketing is enhancing

•Practically, e-marketing or internet marketing is implemented as

• An intensive distribution strategy involves selling a product in

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