MARKETING MANAGEMENT NOTES - REVISON NOTES

MARKETING MANAGEMENT   REVISION  NOTES 

First of all, we welcome you to this online session. . Different people with different objectives would opt to learn marketing. However, marketing, as you will soon see, is important whether you are in the marketing function or any other function of a business. Besides, marketing is a very exciting field. It requires creativity for success. Thus, you have embarked on the study of an exciting subject, which can also increase your creativity. This course has been designed primarily to develop your awareness of the marketing orientation. It is assumed that such knowledge about marketing decisions and processes will not only improve your personal competence but will also help in attaining your organisations' objectives.

The objective of this question is to make you start thinking on your own: While answering the above question have you thought that Marketing and its Applications Marketing is selling or Marketing is advertising or Marketing is promotion If yes, then you are certainly on the right track.

In USA, 300 college administrators were asked about the meaning of marketing. As many as 90 per cent said that marketing was selling, advertising and/or public relations. It is no wonder that the Americans are bombarded with TV commercials, newspaper advertising, sales calls, etc. Even in our own country when managers are asked this question the majority of them give a similar reply. It is important to understand that marketing is much more than selling or advertising, although these do form part of the marketing functions. The American Marketing Association defines marketing as follows: "Marketing is the performance of business activities that directs the flow of goods and services from producer to consumer or user."

If yes, then you are certainly on the right track. In USA, 300 college administrators were asked about the meaning of marketing. As many as 90 per cent said that marketing was selling, advertising and/or public relations. It is no wonder that the Americans are bombarded with TV commercials, newspaper advertising, sales calls, etc. Even in our own country when managers are asked this question the majority of them give a similar reply. It is important to understand that marketing is much more than selling or advertising, although these do form part of the marketing functions. The American Marketing Association defines marketing as follows: "Marketing is the performance of business activities that directs the flow of goods and services from producer to consumer or user."

Do you agree with the above definition? Give your comments. Identify at least 20 products and services that are being currently marketed in India.

This definition is undoubtedly an improvement on describing marketing as selling as it shows that marketing does encompass other activities besides selling. Schematically, this definition can be reproduced as shown below: We can see that Marketing, as per this definition, starts with a ` product'. This is very common idea among many people, for example, in advertising agencies, as they normally are required to advertise to sell a product, which already exists. Similarly, salesmen are also given `products' and asked to sell them. Therefore, to them marketing often, starts with a product,

Human Needs and Marketing Concept We would now like you to fill in what you think come before a product comes into existence  for example  consumable and non durable products, consumer durable products,  A concept   a service, office equipment  etc. what you think should happen when the product or service has reached the consumer or user.

Let us now analyse what could have been written  for what ' comes before the product. You must remember that if you are an entrepreneur who wants to start a new business, you do not have a product. In fact you will have to decide what product you should manufacture and sell. How do you decide this? The answer to this question helps you in filling up (a). Please do so. The entrepreneur has first to decide what product he should select. This he can do only if he can identify the needs, which require satisfaction among human beings. Once he has identified the need of a group of human beings (called market segment), he can determine the product, which can help to satisfy that need. This is a part of the modern philosophy of marketing or the marketing concept.

A Service Philip Kotler, a well-known author in the area of marketing, defines marketing as "A human activity directed at satisfying needs and wants through exchange processes.”

Thus the most fundamental concept, which must be realised as being the basis of all marketing activities, is the existence of human needs. The human need is a state in which a person feels deprived of something. There are many human needs described in many ways. Briefly, these needs can be divided into two types. 1 Phys An Office Equipment iological needs; and 2 Psychological and Sociological needs. The physiological needs consist of the need for food, clothing, shelter and even sex. Similarly, there are social needs for belonging, affection and love from others. Of course, there are higher order psychological needs of self-actualization

It is important to understand that at any time some needs in a human being are dormant and unsatisfied whereas others are active and are being satisfied. A marketing man may thus devise a product or service aimed at satisfying a certain dormant need and thus provide satisfaction to the user as shown in photographs. This is why a man is often described as `a bundle of dormant wants'. The need exists but these have to be converted into `wants' by a marketing strategy. Marketing and its Applications In a socially competitive society, people may have unlimited wants but the ability to buy may be restricted on account of their economic background. They will, therefore, select from among those products, which give satisfaction or are needed more. Thus, when they are backed by ability to buy, the wants are converted into demand for your product. Therefore, when people decide to satisfy their needs and wants, in terms of marketing activities, exchange takes place. This explains in detail the definition given by Kotler. However, does this completely define marketing? Let us analyse this still further. Perhaps you h Introducing Product Selling Advertising Distribution Warehousing Transportation, etc. Similarly, Satisfied Consumer Revenues Surplus Profit, etc. If yes, then we can develop a process-oriented definition of marketing, as "the process of ascertaining consumer needs, converting them into products or services, and then moving the product or service to the final consumer or user to satisfy' certain needs and wants of specific consumer segment or segments with emphasis on profitability, ensuring the optimum use of the resources available to the organisation". In practice, often, separate departments with their own way of thinking perform the business functions, such as production, finance and marketing. Production is often considered the more important function as compare to marketing. This practice is, gradually losing ground and it is being recognized that unless you can sell a product, you should not manufacture it. Production-orientation evolved because often products were designed and developed by inventors who hoped that they would sell. However, if these products fail to satisfy some needs they would never sell in the market place. Therefore, consumer oriented thinking becomes necessary for any business to survive and grow. Peter Drucker stresses this by saying that marketing is so important that it is not enough to have a strong sales department entrusted with marketing. In his view, "concern and responsibility for marketing must permeate all areas of the enterprises".

 Normally, a salesman would like to think of his activity as a `selling' process. When he does this, he is more concerned with handing over his product and receiving money in exchange. However, if he adopts the modern philosophy of treating it as a `buying' process, his job becomes easier. He puts himself in the shoes of the customer and asks the question-Why should I buy this article? When he does this, he will start feeling and thinking as the customer does. His job will become smoother, as he will then know both the benefits and the disadvantages of the product or the service he is offering. This is an illustration of customer-oriented focus.

THE MARKETING MIX

Marketing is performed within a certain environment which itself is always changing. The marketing activities have, therefore, to change in consonance with environment to be continuously effective. In order to appreciate this process it is easier to divide the marketing activities into four basic elements, which are together referred to as the marketing mix.

 These four basic elements are: i) ii) iii) iv) Product, Place Price, Promotion, and Place (or physical distribution). As all these four start with the letter `P' they are, at times, referred to as the four Ps of the marketing mix or the 4Ps in marketing.

The word product stands for the goods or services offered by the organisation: Once the needs are identified, it is necessary to plan the product and after that keep on analysing whether the product still satisfies the needs which were originally planned for, and if not, to determine the necessary changes. You will learn this in greater detail when we talk about product strategies, about how new products are introduced, how they have to be modified in due course to continue to be successful in sales and why marginal or non-profitable products should be removed, unless they are contributing in some way to the overall benefit of the organisation. Price refers to the money value that the customer has to pay. The product has to be adequately priced. This involves considerations of the profit margin, the cost, the possibility of sales at different prices and the concept of the right price. Promotion is the aspect of selling and advertising, or communicating the benefits of the product or service, to the target customers or the market segment involved in order to persuade them to purchase such products or services. It includes selling through advertising as well as the sales force. Besides, a certain amount of promotion is done through special seasonal discounts, competitions, special price reductions, etc. collectively called sales promotion. Finally, physical distribution refers to the aspect of the channels of distribution through which the product has to move before it reaches the consumer. It also includes the logistics aspects of distribution such as warehousing, transportation, etc. needed for geographical distribution of the products. It is also concerned with the selection of distribution channels. The organisation must decide whether it should sell through wholesalers (who buy in large quantities and sell to retailers) and then to retailers (i.e., the shopkeepers, who ultimately sell to consumers), or whether directly to the consumers. There are many ways in which a product can be moved from the producer to the consumer. The optimum method has to be determined in terms of both consumer satisfaction and profitability to the organisation, or optimum use of the organisation's resources.