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Introduction to world of marketing,oportunity pricing decision etc
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Importance of Marketing Management: Marketing management has gained importance to meet increasing competition and the need for improved methods of distribution to reduce cost and to increase profits. Marketing management today is the most important function in a commercial and business enterprise. The following are the other factors showing importance of the marketing management: (i) Introduction of new products in the market. (ii) Increasing the production of existing products. (iii) Reducing cost of sales and distribution. (iv) Export market. (v) Development in the means of communication and modes of transportation within and outside the country. (vi) Rise in per capita income and demand for more goods by the consumers
1. Setting Marketing Goals: The prime task of marketing manager is to set marketing goals and objectives. Clearly and precisely defined objective can help marketing manager to direct marketing efforts effectively. The goals and objective (whether strategic and operating, or short-term and long-term) must be suitably communicated with the employees concern. As far as possible, objectives should be expressed in the quantifiable terms. 2. Selecting Target Market: Segmenting the total market and selecting the target market is a fundamental task of marketing management. Modern marketing practice is based on the target market, and not on the total market. Marketing manager cannot satisfy the needs and wants of entire market. He must concentrate his efforts only on well-defined specific groups of customers, known as the target market. All the marketing functions are directed to cater needs and wants of the target market only. Based on company’s overall capacity, the target market should be selected. 3. Formulating Suitable Marketing Organisation: To implement marketing plan, a suitable organisation structure is essential. On the basis of analysis of type of products, type of market, geographical concentration of market, and many other relevant factors, appropriate organisation must be designed. Various alternative structures are available, such as product organisation, geographic organisation, functional organisation, matrix organisation, etc. Based upon requirements, the appropriate structure should be prepared and modified as per needs. 4. Maintaining Healthy Relations with other Departments: Marketing department needs cooperation from other departments of organisation, including financial department, personnel department, and production department, to satisfy customers effectively. Their support is considered to be important to satisfy consumers. Thus, for integrated efforts, marketing manager should try to establish good relations with them. Likewise, within marketing department, he must establish coordination among various personnel.
5. Establishing and Maintaining Profitable Relations with Outside Parties: Alike internal support, the external relations are also extremely necessary. Marketer, in order to carry out marketing activities effectively, must establish and maintain healthy relations with various parties, such as suppliers, service providers, government agencies, dealers, consultants, and so forth. Without their support, marketing manager cannot carry out functions successfully. Due to important role of external relations, contemporary marketing practices can be said as relationship marketing. 6. Marketing Research Activities: Marketing research is one of the important functions of modern marketing. Marketing research involves systematic collection, analysis, and interpretation of data on any problem related to marketing. It provides the manager with valuable information on which marketing decisions can be taken. Marketing research is essential to know adequately about consumers and market situation. It is a basic function to satisfy consumers. Marketing efforts are based on the marketing research information. 7. Sales Management: Sales management is one of the important functions of marketing management. Sales management concerns with planning, implementation, and controlling selling efforts. It performs all the activities directly related to execution of sales. Sales department carry out selling functions. Sales department formulates sales policies, ensures adequate quantity of products, maintains sales records, formulates structures for sales department, manages sales force (salesmen), and controls selling efforts. 8. Exercising Effective Control on Marketing Activities: Control is essential to ensure that activities are performed as per plan. Control involves establishing standards, measuring actual performance, comparing actual performance with standards, and taking corrective actions, if needed. Control keeps the entire marketing department alert, active, and regular. Marketing manager should set up an effective controlling system to monitor marketing efforts. Marketing Management is a social and managerial process by which individuals or firms obtain what they need or want through creating, offering, exchanging products of value with each other.
On the contrary, he will work for damaging your reputation. Therefore, it can be asserted that this philosophy offers only a short-term advantage and is not for long-term gains.
4. Marketing Concept Those companies who believe in this concept are of the opinion that success can be achieved only through consumer satisfaction. The basis of this thinking is that only those goods/service should be made available which the consumers want or desire and not the things which you can do. In other words, they do not sell what they can make but they make what they can sell. Keeping in mind this idea, these companies direct their marketing efforts to achieve consumer satisfaction. In short, it can be said that it is a modern concept and by adopting it profit can be earned on a long- term basis. The drawback of this concept is that no attention is paid to social welfare. 5. Societal Marketing Concept This concept stresses not only the customer satisfaction but also gives importance to Consumer Welfare/Societal Welfare. This concept is almost a step further than the marketing concept. Under this concept, it is believed that mere satisfaction of the consumers would not help and the welfare of the whole society has to be kept in mind. For example, if a company produces a vehicle which consumes less petrol but spreads pollution, it will result in only consumer satisfaction and not the social welfare. Primarily two elements are included under social welfare-high-level of human life and pollution free atmosphere. Therefore, the companies believing in this concept direct all their marketing efforts towards the achievement of consumer satisfaction and social welfare. In short, it can be said that this is the latest concept of marketing. The companies adopting this concept can achieve long-term profit. Marketing Environment The term Marketing Environment refers to the forces and factors that affects the organisation ability to built and maintain good relationship with its customers. Marketing environment surrounds the organisation and it impacts upon the organisation. Marketers have to interact with internal and external people at micro and macro level and builds internal and external relationships. The key elements of marketing environment are as follows :- 1. Internal Environment, 2. Micro Environment, and 3. Macro Environment. Internal Environment Internal factors like men, machine, money, material, etc., on which marketing decision depends consists internal marketing environment. The internal environment refers to the forces that are within the organisation and affects its ability to serve its customers. It includes marketing managers, sales representatives, marketing budget, marketing plans, procedures, inventory, logistics, and anything within organisation which affects marketing decisions, and its relationship with its customers.
Micro Environment Individuals and organisations that are close to the marketing organisation and directly impacts its ability to serve its customers, makes Marketing Micro Environment. The micro environment refers to the forces that are close to the marketing organisation and directly impact the customer experience. It includes the organisation itself, its suppliers, marketing intermediaries, customers, markets or segments, competitors, and publics. Happenings in micro environment is relatively controllable for the marketing organisation. Macro Environment Macro environment refers to all forces that are part of the larger society and affects the micro environment. It includes demography, economy, politics, culture, technology, and natural forces. Macro environment is less controllable. Marketing Strategy - Your marketing strategy is an explanation of the goals you need to achieve with your marketing efforts. Your marketing strategy is shaped by your business goals. Your business goals and your marketing strategy should go hand-in-hand. Marketing Plan - Your marketing plan is how you are going to achieve those marketing goals. It's the application of your strategy a roadmap that will guide you from one point to another. The issue is that most people try to set out to achieve the "how" without first knowing the "what." This can end up wasting resources for a company, both time and money. Marketing Strategy ---> Marketing Plan ---> Implementation = Success Your marketing strategy consists of: The "what" has to be done. Inform consumers about the product or service being offered. Inform consumers of differentiation factors. Your marketing plan consists of: The "how" to do it. Construct marketing campaigns and promotions that will achieve the "what" in your strategy. Your implementation consists of: Taking action to achieve items identified in marketing strategy and marketing plan. A developed market is a country with a highly industrialized economy, typically with a large service sector. A developed country will tend to have a high GDP per capita income, and built out infrastructure (transportation, communications) compared to a developing country. Another name for a developed market is “advanced” market or advanced economy. Examples: United States, Japan, Germany, Australia, Canada, France A developing market is the opposite of a developed market. Surprisingly, China is a developing market because, while it has the second highest GDP in the world, its also has the largest population. The average citizen in China does not have close to the same level of economic prosperity as one would find in the United States. market research :
procedures to gather, sort, analyze, evaluate, and distribute the needed, timely, and accurate information to marketing decision makers.” Internal Records System: Internal records system is a major and easily accessible source of information. It supplies the results data. It consists of all records of marketing operations available within organisation. This system concerns with collecting, analyzing, interpreting, and distributing needed information from records of various departments of the company. Main sources include various records on sales and purchase, ordering system, sales force reporting system, inventory level, receivable-payables, marketing staff, costs, the past research works, and other literatures/reports available within organisation. Particularly, for sales orders and sales force reporting, the computer technology is excessively used for accurate, efficient, and speedy transmission of information. Marketing Intelligence System: While internal report system concerns with information available from internal records of organisation, the marketing intelligence system supplies the managers with happening data. It provides information about external happenings or external environment. Marketing intelligence system is: The set of procedures and sources used by managers to obtain every-day information regularly about pertinent developments in the marketing environment. A manager can try to expose external environment in various ways. Marketing intelligence system consists of various methods. A manager can use one or more below mentioned methods: i. Reading newspapers, books, and other publications. ii. Watching TV, hearing radio, or Internet surfing. iii. Talking to customers, dealers, suppliers, and other relevant parties. iv. Talking to other managers and employees of his company as well as of other companies. v. Maintaining live contacts with other officials and agencies. vi. Purchasing useful information from professional sources. vii. Assigning marketing intelligence task to professional agencies, etc.
Effective marketing intelligence system can facilitate managers to take immediate actions like reacting to competitors, meeting changing needs of customers, solving dealers’ problems, and so on.
3. Marketing Research System: Marketing research is a powerful and independent branch of the MIS. In certain cases, managers need detailed information on the specific problem of the specific marketing area. Thus, it is a formal study of specific problems, opportunities, or situations. Normally, it is carried out for solving the specific problem. In this sense, it is not a part of routine activity. It collects need-based information. Nowadays, it is treated as the separate discipline or subject. Philip Kotler defines: “Marketing Research is the systematic design for collection, analysis, and reporting of data and findings relevant to specific marketing situations facing the company.” Marketing research consists of collecting primary and secondary data from various respondents using various tools through various methods for definite period of time, analyzing data using appropriate statistics tools, and presenting findings in forms of a report. It is conducted by internal expert staff or external professionals. 4. Marketing Decision Support System (MDSS): Previously, the component was known as Analytical Marketing System. While former three components supply data, the marketing decision support system concerns more with processing or analyzing available data. This component can improve efficiency and utility of the whole marketing information system. The system is used to help managers make better decisions. John D. C. Little defines: “A marketing decision support system (MDSS) is coordinated collection of data, systems, tools, and techniques with supporting software and hardware by which an organisation gathers and interprets relevant information from environment and turns it into a basis for making decisions.” According to the definition, the MDSS includes tools, techniques or models used for: (1) Data collection, (2) Data analysis, (3) Interpreting results, and (4) Supporting managerial decision-making. In real sense, it is not a separate component, but extension of other components. Statistical tools, new models, and software are used to help marketing managers analyze, plan, and control their operations. The MDSS consists of two sub-components – the statistical bank and the model bank. Commissioned research means research , survey or other work, the costs of which are wholly paid for by the customer. Commissioned research carried out in cooperation with industry and business will be done in confidence, in an unbiased manner and as agreed. Market Research Process Step1.Define the Objective & Your “Problem” Perhaps the most important step in the market research process is defining the goals of the project. At the core of this is understanding the root question that needs to be informed by market research. There is typically a key business problem (or opportunity) that needs to be acted upon, but there is a
and materials for the moderator. You get the idea. This is the part of the process where you start executing your plan. By the way, step 3.5 should be to test your survey instrument with a small group prior to broad deployment. Take your sample data and get it into a spreadsheet; are there any issues with the data structure? This will allow you to catch potential problems early, and there are always problems. Step 4. Collect Your Data This is the meat and potatoes of your project; the time when you are administering your survey, running your focus groups, conducting your interviews, implementing your field test, etc. The answers, choices, and observations are all being collected and recorded, usually in spreadsheet form. Each nugget of information is precious and will be part of the masterful conclusions you will soon draw. Step 5. Analyze Your Data Step 4 (data collection) has drawn to a close and you have heaps of raw data sitting in your lap. If it’s on scraps of paper, you’ll probably need to get it in spreadsheet form for further analysis. If it’s already in spreadsheet form, it’s time to make sure you’ve got it structured properly. Once that’s all done, the fun begins. Run summaries with the tools provided in your software package (typically Excel, SPSS, Minitab, etc.), build tables and graphs, segment your results by groups that make sense (i.e. age, gender, etc.), and look for the major trends in your data. Start to formulate the story you will tell. Step 6. Visualize Your Data and Communicate Results You’ve spent hours pouring through your raw data, building useful summary tables, charts and graphs. Now is the time to compile the most meaningful take-aways into a digestible report or presentation. A great way to present the data is to start with the research objectives and business problem that were identified in step 1. Restate those business questions, and then present your recommendations based on the data, to address those issues. Online marketing research is the process by which companies use the Internet to gather data to evaluate how well a product or service is selling to consumers. The information provided by a careful market analysis conducted online can also identify popular trends that can assist a company in creating a strategy that will get better results. When used properly, online marketing research can be an effective tool that a company can use to experience higher revenues. In addition to identifying potential areas for growth, online market research can help a company learn more about its target consumers. For example, if consumers purchase a certain type of product and then return to purchase accessories, that is a specific type of consumer behavior that can be measured. The information gathered from doing an online market research study is helpful to track this type of behavior. An online marketing research study can be conducted by the company itself, or the company may choose to hire an outside company to manage this. How and by what method a company decides to conduct a market research plan is dependent upon how objective or anonymous the company wishes to remain. An online marketing research program can include any number of methodologies. Some
companies may use a direct method, by which a survey is sent out to existing customers to determine satisfaction levels and gather feedback. A company may also contact consumers and gather information from a specific demographic, such as an age group, or a specific geographic region. Companies may also use a “blind” method, by which a random sample of the population is contacted for opinions online. With the advent of more social media networking websites, some companies are tapping into communities to gather important market behavior information. Some of the larger social media networks offer up general data about the registered users of these sites to benefit market research. The information gathered online in social media networks can be very valuable to marketing firms. Using online market research data is one way that companies adapt existing products to meet the needs of consumers. It is also one of many ways that companies develop new products and services that consumers rely on. Companies carefully evaluate and use the data that online market research campaigns produce to influence the market via consumers. When it comes to online marketing research, the general understanding is that since the market is mostly consumer driven, anything that can be done to influence consumers is positive for business. Influencing consumers stimulates the market. This can result in better products, plus higher sales and revenues for companies who best use the research data. Market Research And Ethics A basic role for a marketing researcher is that of intermediary between the producer of a product and the marketplace. The marketing researcher facilitates the flow of information from the market or customer to the producer of the good or service. Such a situation, with three major players—the producer, the customer and the market researcher— often sets the stage for conflicts of interest which, as Plato noted, can give rise to ethical problems. Given the inevitability of ethical dilemmas in marketing research, well-established ethical guidelines are critical for their resolution. In this article, we identify resources for ethical decision making in marketing research in three key areas where problems often arise: In the relationship between the researcher and the client Between the researcher and the research subject Between the researcher and the marketing research industry INTERNATIONAL MARKET RESEARCH International Market Research is a particular discipline of Market Research, focusing on certain geographical areas. International Market Research is concerned with consumer goods, but also with any resource or service within a value chain which will be commercially utilised or further processed – which is the area of industrial goods and B2B-Marketing. International market research projects may have various objectives and purposes. Classical market research very often covers cross-country issues. Same question, but being raised internationally. This may however lead to differing answers from country to country – due to
positions, but also in New Business Development, in a Strategy staff, in Corporate Planning departments and of course, within top management. International Market Research provides an information base for strategic decisions. Here, competitive information needs to be available early, fastly, and with the right filter. What needs to be considered when executing International Market Research? Strategic decision-making requires an outstandingly high quality information base. Therefore, international market research projects have to consider the following: globalization experts are featured by product and industry knowledge, industry-specific experiences, methodological know-how like research methods, information access (e.g. to specialising commercial data bases), reputation (e.g. experts with door-opener-quality) and international experience, language skills, and others more competitive information needs the right focus, but also needs to be provided fastly, and early enough in order to be effective. information should be retrieved exclusively for your company – if all the industry enjoys the information there will not be any competitive gain Procurement of information may be done by internal staff (“make”, e.g. sales force, internal research department), but also by such type of external market intelligence specialist who are working in the international field.
Step 3 - The next step is to evaluate the various alternatives available in the market. An individual after gathering relevant information tries to choose the best option available as per his need, taste and pocket. Step 4 - After going through all the above stages, customer finally purchases the product. Step 5 - The purchase of the product is followed by post purchase evaluation. Post purchase evaluation refers to a customer’s analysis whether the product was useful to him or not, whether the product fulfilled his need or not? CREATING CUSTOMER VALUE Step 1: Understand what drives value for your customers Talk to them, survey them, and watch their actions and reactions. In short, capture data to understand what is important to your customers and what opportunities you have to help them. Step 2: Understand your value proposition The value customers receive is equal to the benefits of a product or service minus its costs. What value does your product or service create for them? What does it cost them–in terms of price plus any ancillary costs of ownership or usage (e.g., how much of their time do they have to devote to buying or using your product or service?) Step 3: Identify the customers and segments where are you can create more value relative to competitors Different customers will have varying perceptions of your value relative to your competitors, based on geographic proximity, for example, or a product attribute that one segment may find particularly attractive. Step 4: Create a win-win price Set a price that makes it clear that customers are receiving value but also maximizes your “take.” Satisfied customers that perceive a lot of value in your offering are usually willing to pay more, while unsatisfied customers will leave, even at a low price. Using “cost-plus” pricing (i.e., pricing at some fixed multiple of product costs) often results in giving away margin unnecessarily to some customers while losing incremental profits from others. Step 5: Focus investments on your most valuable customers Disproportionately allocate your sales force, marketing dollars, and R&D investments toward the customers and segments that you can best serve and will provide the greatest value in return. Also, allocate your growth capital toward new products and solutions that serve your best customers or can attract more customers that are similar to your best customers. Analysis of Consumer Markets Firms need to research the consumer market to find answers to the questions:
1. Who constitutes the market? (occupants)
