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MM Unit - 1
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1.Market Analysis/Environment
2.Consumer Behaviour
3.Product Design
Course Outcomes: At the end of the course the student will be able to
CO1 Understand the fundamentals and analyze core aspects of marketing.
CO2 Demonstrate the market segmentation and targeting to build knowledge on consumer behavior
CO3 Use creative, critical and reflective thinking to address organizational opportunities and to interpret the product and pricing decisions.
Total Hours : 45
Text Books :
[1]Philip Kotler, Kevin Lane Kellar, Abraham Koshy, and MithileswarJha, "Marketing Management “A South Asian Perspective”, Pearson Education
[2]Ramaswamy V.S. &Namakumari S, Marketing Management – Global Perspective,Indian context – MacMillan 4th edition
Reference Books :
[1]Louis W Stern, Adel I El Ansary, and Anne T Coughlan.,"Marketing Channel", New Delhi: Prentice Hall of India
[2]Naresh K Malhotra and Satyabhusan Dash, "Marketing Research - An Applied Orientation",New Delhi: Pearson
NPTEL Link
https://nptel.ac.in/courses/110107147
Unit-I
Introduction to Marketing
Retailer
Wholesale
r
Goods/services
Industry Market
(a collection (a collection
of sellers) of Buyers)
Money
Information
21
Difference Between - Sales & Marketing ?
Sales
Trying to get the customer to want what the
company produces.
Marketing
Trying to get the company produce what the
customer wants.
Difference Between Sales and Marketing
Objectives of Marketing Management
1.Creating New Customers
2.Satisfying the needs of Customers
3.Enhancing the Profitability of the Business
4.Raising the Standard of living of the people –
Production of wide variety of goods and
services for satisfying customer’s needs
5.Building and retaining Long term relationship
with customers
Important Features of Marketing
1. Marketing is aimed at finding out consumer needs
and meeting these needs.
2. Marketing must consider profit as its main
objective.
3. Marketing is ongoing all the time. The marketing
process has no start or end.
4. Businesses must be prepared to respond to the
consumer reactions and changes all the time.
Importance of Marketing
1.Marketing Helps in Transfer, Exchange and
Movement of Goods
2.Marketing Creates Employment
3.Marketing as a Source of Income and Revenue
4.Marketing Acts as a Source of New Idea
5.Marketing Is Helpful In Development Of An
Economy
Functions of Marketing
1.Gathering and Analyzing Market Information
2.Marketing Planning
3.Product Designing and Development
4.Standardization and Grading
5.Packaging and Labelling
6.Branding
7.Customer Support Service
8.Pricing of Products
9.Promotion & Physical Distribution
10.Transportation& Warehousing
Defining and delivering customer value and
satisfaction
Customer value
• Customer value is best defined as how much a
product or service is worth to a customer.
• It's a measure of all the costs and benefits
associated with a product or service.
• Examples include price, quality, and what the
product or service can do for that particular
person.
Customer value
• Customer value is present when
the benefits offered by a product are more than
the costs used to acquire that product.
• Customer Value is the incremental benefit
which a customer derives from consuming a
product after paying in return.
• Customer value can be determined by
subtracting total customer costs from total
customer benefits.
Customer Value Parameters
Customer satisfaction
• Customer satisfaction refers to the evaluation
by customers of how well the value was
delivered by the product, i.e. did the product
deliver the value that they expected to receive
from it?
• Hence, it takes place after the customer has
purchased the product.
Difference between customer value and
customer satisfaction
1. Meaning
• Customer value is the difference between the
total benefits expected from a product/service
and the total costs incurred to obtain that
product or service.
• On the other hand, customer satisfaction
refers to the difference between the actual
performance experienced by a customer and
the expectation of the customer.
2. Type of process
• Customer value is a proactive process as it
takes place before the customer has actually
experienced the product, i.e. it is the pre
purchase assessment of a product by a
customer.
• In contrast, customer satisfaction is a reactive
process, which is basically the difference
between the expectation of the customer and
the experience of the customer after using that
product/service.
3. Concept
• Customer value is evaluated from the point of
view of customers.
• Customer satisfaction, however, is an emotional
concept as it pertains to the feelings of
customers. We determine how satisfied we are
from a purchase on the basis of our experience
of using that product/service.
4. Computation
• Customer value is determined by simply
subtracting total costs from benefits and can be
described in monetary terms.
• Customer satisfaction is measured in
qualitative terms as subtracting actual
performance from the expected performance is
more subjective in nature. It involves emotions
and is difficult to quantify.
Value Chain – Delivery network
What Is a Value Chain?
• A value chain is a series of consecutive steps
that go into the creation of a finished product,
from its initial design to its arrival at a
customer's door.
• The chain identifies each step in the process at
which value is added, including the sourcing,
manufacturing, and marketing stages of its
production.
• A value chain is a step-by-step business model
for transforming a product or service from idea
to reality.
• Value chains help increase a business's
efficiency so the business can deliver the most
value for the least possible cost.
• The end goal of a value chain is to create a
competitive advantage for a company by
increasing productivity while keeping costs
reasonable.
• The value-chain theory analyzes a firm's five
primary activities and four support activities.
Primary Activities
• Inbound logistics include functions like receiving,
warehousing, and managing inventory.
• Operations include procedures for converting raw
materials into a finished product.
• Outbound logistics include activities to distribute a
final product to a consumer.
• Marketing and sales include strategies to enhance
visibility and target appropriate customers—such as
advertising, promotion, and pricing.
• Service includes programs to maintain products and
enhance the consumer experience—like customer
service, maintenance, repair, refund, and exchange.
Support Activities
• Procurement concerns how a company obtains raw
materials.
• Technological development is used at a firm's
research and development (R&D) stage—like
designing and developing manufacturing techniques
and automating processes.
• Human resources (HR) management involves
hiring and retaining employees who will fulfill the
firm's business strategy and help design, market, and
sell the product.
• Infrastructure includes company systems and the
composition of its management team—such as
planning, accounting, finance, and quality control.
Delivery Network
• It is a network that is made up of the company,
its suppliers, its distributors, and ultimately its
customers who partner with each other
to improve the performance of the entire
system to deliver the customers value.
• “Value delivery network is a part of the
supply chain of a company and includes all its
direct participants involved in the production,
distribution, marketing, customer service, etc.
Marketing Environment
Meaning
• Marketing activities are influenced by several
factors inside and outside a business firm.
• These factors or forces influencing marketing
decision making are collectively called
marketing environment.
Marketing Environment
Definition
• According to “Philip Kotler” A company’s
marketing environment consist of the internal
factors and forces, which affect the company’s
ability to develop & maintain successful
transaction & relationship with the company’s
target customer’s.
Marketing Environment
Marketing Environment
• Micro environment: These are internal factors,
which the organization can control.
5. Political Environment
• Political environment consists of laws,
government agencies, and pressure groups that
influence or limit various organizations and
individuals in a given society
6. Cultural Environment
• Cultural environment consists of institutions
and other forces that affect a society’s basic
values, perceptions, and behaviors.
• Examples include culture, traditions, beliefs,
norms, etc.
The marketing environmental analysis will help
the marketer to:
1.Become well acquainted with the changes in
the environment.
2.Gain qualitative information about the business
environment; which will help him to develop
strategies in order to cope with ever changing
environment.
3.Conduct marketing analysis in order to
understand the markets needs and wants so as
to modify its products to satisfy these market
requirements.
4. Allocate its resources effectively and diversify
either into a new market segment or totally
into a new business which is outside the scope
of its existing business.
5. Identify the threats from the environment in
terms of new competitors, price wars,
competitor’s new products or services, etc.;
and prepare its strategies on the basis of that.
6. Identify its weaknesses such as lower quality
of goods or services; lack of marketing
expertise; or lack of unique products and
services; and prepare strategies to convert its
weaknesses into strengths.
7. Identify its strengths and fully exploit them in
firm’s advantage. These strengths can be in
terms of marketing expertise, superior
product quality or services, or giving unique
innovative products or services.
Digitalization and Customization
Digitalization
Digitalization
• Digitalization is the use of digital technologies
to alter a business model and generate new
revenue and value; it is transitioning to a digital
business.
The Advantages of Digitalization in Marketing
• Digitalization in Marketing can facilitate global trade
and settlement.
• Digital platforms connect buyers and sellers directly,
eliminating the need for a middleman.
• The youth are encouraged by digital platforms.
• Marketing and advertising costs are lower – Small
businesses can easily implement them without
breaking the bank to manage advertising for their
products and services.
• The results are more quantitative. You can now
answer the question, “Which half of your advertising
spend brings you results?”
The Impact of Digitalization in Marketing
1. Prompt Customer Feedback
2. Planning for the Short Term
3. Customers are easily accessible through digital
marketing channels.
4. Referrals and a large client base with a small
budget
5. More Effective Digital Branding
6. Increased Productivity through E-Learning
7. Increased Customer Satisfaction
Customization
What is customization?
• Customization refers to the action of altering a
product or service to suit a person’s or
company’s preferences or requirements.
• We can also use the term when we modify
something for a specific task.
• The focus is more on altering an existing
service, product, or experience to suit one
specific consumer or a group of them. The
customer is guiding the changes.
What is customization?
• Product customization refers to enabling
customers to personalize a product according
to their needs and preferences.
• Add ons, exclusive functionalities, templates,
and flexibility with product design all count as
different forms of personalization.
4 ways customized products impact customer
satisfaction
1. Cater to different customers’ requirements
2. Gain loyal customers
3. Understand your customers better
4. Boost sales and business success
Changing Marketing Practices
1. Find Out Where Your Customers Are
2. Be Available
3. Respond Quickly and with meaning
4. Understand their goals and help them make
informed decisions
5. Collaborate with your customers to create
value
6. Add a personal touch
7. Build Credibility
8. Measure and refine
The Best Marketing Practices
3.Access
4.Effective Promotion
Changing Marketing Practices
3. Retraining salespeople.