What is Marketing? Fundamentals of Marketing …

1 What is Marketing ? Fundamentals of Marketing Management Process by which individuals and groups Dr. (Sundar) Balakrishnan obtain what they need and want through creating and exchanging products and value with others. Managing World-Class Organizations Simply put: Marketing is the delivery of customer satisfaction at a profit. Balakrishnan S #1 Balakrishnan S #2. The Marketing Objective Activities in the Marketing Process .. Identify needs of customers that company can Satisfy the needs of a group of customers better satisfy than the competition.. Design a Product ( bundle of benefits ) that Distinguish from Selling or Advertising: satisfies those needs - better than existing merely a subset of Marketing actions used to products.

2 Satisfy consumer needs. Promote / communicate these benefits in order Marketing focuses on the use of all the firm's to motivate purchase controllable influences to satisfy the customer. Price at the right level so that consumers are willing & able to buy the product and the firm's profit goals are met Make the product available at the right Place so that exchange is facilitated Balakrishnan S #3 Balakrishnan S #4. Broad Objective of Marketing Core Marketing Concepts To grow the business by adapting it to changes in the Needs, wants, environment : and demands by monitoring changes in customer needs Products Markets changes in competition and services changes in the company's own skills /. resources looking for opportunities & threats that arise from these changes Exchange, Value, initiate tactical actions that fit the co's offering transactions, satisfaction, to these opportunities / threats.

3 And relationships and quality Balakrishnan S #5 Balakrishnan S #6. Consumer's Needs, Wants and Demands Products & Services: z Needs - state of felt deprivation for basic items such as food and clothing and complex needs such as for belonging. Products Anything that can be Offered to a Market to Satisfy a Need or Want I am hungry. z Wants - form that a human need takes as shaped by culture and individual personality. Experiences Persons Places I want a burger, fries, and a soft drink. z Demands - human wants backed by buying Organizations Information Ideas power. I have money to buy this meal. Services Activities or Benefits Offered for Sale That Are Essentially Intangible and Don't Result in the Ownership of Anything Balakrishnan S #7 Balakrishnan S #8.

4 Products How Do Consumers Choose Among Products and Services? DMP. z A bundle of Attributes that provide Consumers with certain Benefits. Value Gained From Owning a Product and z Also called Costs of Obtaining the Product is Resource; Marketing Offer; Customer Solution Customer Value z Ex: Drill Bits. Product's Perceived Performance in Delivering Value Benefits provided? Relative to Buyer's Expectations is z Sellers who focus on the Specific product rather Customer Satisfaction than the Benefits provided suffer from Marketing Myopia . Total Quality Management Involves Improving the Quality of Products, Services, and Marketing Processes Balakrishnan S #9 Balakrishnan S #10. How Do Consumers Obtain Products and What is a Market? Services?

5 People Who Exhibit Need Market . Transactions: Ethical Actual Exchanges: Buyers who Factors Unit of Measurement Buyers share a Situational Fundamental Concept Unexpected Resources to particular need Exchange or want that Relationships Building a Marketing can be satisfied Attitudes through Network Consisting of Relationship Marketing : The Company and All of Potential exchange Others or How does Saturn build lasting relationships with customers? Its Supporting Buyers Stakeholders Willingness to relationships. Exchange Click or Press Space Bar to Return Balakrishnan S #11 Balakrishnan S #12. Modern Marketing System Marketing Management Suppliers Marketing Demand Profitable Management Management Customer Company Relationships Competitors (Marketer) Implementing Finding and programs increasing Attracting new Environment Environment to create demand, also customers and Marketing exchanges changing or retaining and with target reducing building Intermediaries demand such buyers relationships to achieve as in with current organizational Demarketing customers End User goals Market Balakrishnan S #13 Balakrishnan S #14.

6 Marketing Management Philosophies Societal Marketing Concept Society Consumers favor products that are (Human Welfare). Production Concept available and highly affordable. Improve production and distribution. Consumers favor products that offer Product Concept the most quality, performance, and innovative features. Selling Concept Consumers will buy products only if Societal the company promotes/ sells these Marketing products. Concept Marketing Concept Focuses on needs/ wants of target markets & delivering satisfaction better than competitors. Consumers Company Societal Marketing Concept Focuses on needs/ wants of target (Want Satisfaction) (Profits). Balakrishnan markets & delivering superior #15 Balakrishnan S #16. Basic Marketing Concept Marketing vs.

7 Sales Concepts Achieving the SATISFACTION of the Customers' Needs Starting Focus Means Ends Point Selling Profits Existing While Factory and through Products Promoting Volume The Selling Concept Achieving the OBJECTIVES of the Organization Profits Customer Integrated Market through Needs Marketing Satisfaction The Marketing Concept Balakrishnan S #17 Balakrishnan S #18. Evolution of Marketing The Marketing Concept To achieve organizational (& Societal) goals Marketing as Organizational Philosophy by determining the needs and wants of customers and delivering the desired benefits more effectively and efficiently than Production Selling Marketing competitors. Philosophy Philosophy Philosophy z There is only one valid definition of business purpose: to create a customer.

8 - Peter Drucker z Everything starts with the customer.. - Lou Gerstner, CEO of IBM. Creating shareholder wealth is not the Marketing purpose of the business. It is the reward for Concept creating customer value.. - Michael Tracy and Fred Wiersema in CFO magazine This is going on today at Internet Time! Balakrishnan S #19 Balakrishnan S #20. Connecting With Customers Market Orientation z Market Segmentation: determining distinct groups An organization that has a market of buyers (segments) with different needs, orientation focuses its efforts on characteristics, or behavior. continuously collecting information about customers' needs and competitors capabilities, sharing this information across z Market Targeting: evaluating each segment's departments, and using the information to attractiveness and selecting one or more segments create customer value.

9 To enter. Balakrishnan S #21 Balakrishnan S #22. Developing the Marketing Mix Marketing Framework Product Price Goods-and-service Amount of money combination that a that consumers company offers a have to pay to target market Obtain the product Target Customers Activities that Inform, persuade target Intended customers to buy Positioning the product Company activities Promotion that make the product available Balakrishnan Place S #23 Balakrishnan Source: Robert Dolan, HBS Note S #24. Recasting the 6C - 4P Framework in Value The new view 6 Cs Framework Terms CONTEXT. Creating Customers Value Communicating Value Competitors COMPANY Complementors Customer Product Delivering Company Value Price Collaborators Competitor Collaborators Place Capturing Customer value your product more if the Complementors Value complementor's product is present ( , Complementor Context Promotion hot dog producer and mustard producer!)

10 Sustaining Customer value your product less if the Value Competitor competitor's product is present Balakrishnan S #25 Balakrishnan S #26. Consumer Benefits Relationship Marketing Create value for consumers and benefit producers through the four utilities: Form utility having a product or service in the form you The hallmark of developing and maintaining want it by to make it more appealing to buyers. effective customer relationships is today Time utility having a product or serviced when you want it. called relationship Marketing , linking the Place utility having a product or service where you want it. organization to its individual customers, employees, suppliers, and other partners Possession utility helping buyers to take possession of a for their long term benefit.