Marketing Management Chapter One Reading Materail

Reading Material Of marketing

1. MBA 1
st
Semester




Marketing for Managers

2. Meaning of Marketing

3. • Marketing refers to the entire activities ranging from developing the ideas to the
after-sales services.
• Concepts of Marketing
• Marketing is a very wide term. It includes all the activities involved right
from the production of the goods, until their consumption. Generally,
activities that deal with buying and selling of goods or services are called
marketing. It is also a process which carries goods from producer to
ultimate consumer. Thus, it bridges the gap between consumer and
producer.
• Concept of marketing can be studied into two aspects.
A. Narrow Concept
• It concentrates on selling whatever has been produced ignoring the consumer's
satisfaction.
• It is a traditional concept which focuses on 'telling and selling'. This concept is
based on 'we sell what we make'.
B. Broad Concept
• The broad concept of marketing gives first priority to customers satisfaction.
• It accepts profit as the gift of customer's satisfaction.
Marketing

4. Extra

Basis of Difference Old Concept of Marketing New Concept of Marketing
Introduction It is the process of buying and
selling of products to earn profit.
It is the process of identifying
consumers' need, producing
products and satisfying the needs.
Scope Scope is limited in old concept. It has wider scope.
Objective/Purpose The main objective of the old
marketing concept is to earn
profits through more production
and high sales.
The new concept also aims to
earn more profit but through
customers satisfaction and
welfare.
Orientation It is production and Product-
oriented.
It is Customer-oriented.
Focus On It focuses on mass production
and large volume sales.
It focus on consumer satisfaction
and social welfare.
Start/End It starts after production and
ends after sales.
It starts before production and
ends after customer satisfaction.
Role Of Marketing
Information System
No role of Marketing Information
System.
Important role of Marketing
Information System.
Social Responsibility It is not involved in social
responsibility.
It emphasis on social
responsibility.

5. • Modern marketing began
in the 1950s when people
started to use more than
just print media to
endorse a product.
• As TV -- and soon, the
internet -- entered
households, marketers
could conduct entire
campaigns across
multiple platforms.




Evolution of Marketing ?(Extra)

6. • 1. Needs, Wants and Demand:
• Needs: A human need is a state of felt deprivation of some satisfaction. People
require food, clothing, house to live in and a few other things for survival.
The needs of human beings can be classified in physiological, security, social,
esteem and self-actualization needs. For example- food, clothing, knowledge,
etc. are human needs.

• Wants: Wants are desires for specific satisfiers of these deeper needs.
Although people's needs are few, their wants are many. Human wants are
continually shaped and reshaped by social forces and institutions, such as
schools, families, and business corporation. Eg: American wants burger, a
Nepalese wants momo.

• Demand: A demand is a customer’s wants, ability to pay and willingness to
pay a price for a specific goods or services. For eg; Many people want a
Mercedes but only a few are able to buy one. Company must measure not only
how many people want their product, but also how many people willing and
able to buy it. Demand can be of two types: Primary and secondary demand.
Marketing Concepts

7. Product is a generic term used to describe what is being sold by a seller or
marketer. A marketer can satisfy the needs and wants of his customers by
‘offering something’ in exchange for money. And this ‘offering’ is basically a
product. Products can be anything. It can be
• Physical product (e.g. fan, cycle etc.),
• Service (e.g. haircuts, property deals etc.),
• Place (e.g. Kathmandu, Pokhara etc.),
• Organization (e.g. Maiti Nepal,CG Group etc.)
• Idea (e.g. Family Planning, safe driving etc.).
In the context of marketing, a service refers to an intangible offering provided
by one party to another. Unlike physical products, services are not tangible
objects that customers can touch or possess; instead, they involve performing
actions, providing expertise, or delivering experiences. Services can encompass
a wide range of offerings, including professional advice, consulting, healthcare,
education, hospitality, entertainment, and more.
2. Product or Service:

8. 3. Value, Satisfaction and Expectations:
• Value: Value reflects the perceived tangible and intangible benefits and cost
to customers. Value is primarily a combination of quality, services, and price
(qsp) called the customers value triad. Value perceptions increase with
quality and services but decrease with price. Providing value is essential for
attracting and retaining customers.

• Satisfaction: It refers to the buyer’s state of being adequately rewarded by
the purchase decision. Satisfaction reflects a person’s judgment of a product
perceived performances in relationship to expectations. If the performance
falls short of expectations, the customer is disappointed. If it matches
expectation the customer is satisfied. If it exceeds them, the customers are
delighted.

• Expectations: Expectations are formed on the basis of the buyer's past
buying experiences, statements made by friends and associates, and
marketers and competitors information and promises. Managing
expectations is critical; if they are set too high and not met, it can lead to
dissatisfaction. Conversely, exceeding expectations can result in delighted
customers. Marketers must align their messaging and promises with what
they can deliver to ensure a positive customer experience.

9. • Exchange
• Exchange is a process by which two or more individuals or organizations give
and receive something of value. For exchange to happen, the following
conditions must be satisfied.
➢ There are at least two parties,
➢ Each party has something of value to offer to the other party,
➢ Each party is capable of communication and delivery,
➢ Each party is free to accept or reject the offer,
➢ Each party believes in the credibility of other party.
• Transactions: Transactions are the basic unit of exchange. A transaction
consists of a trade of values between two parties. Transactions do not always
require money as one of the traded values. A barter transaction can consist
of trading services instead of goods. Usually, a legal system arises to support
and enforce compliance on the part of transactions.
• Transfer: n the context of marketing and business, transfer can involve the
exchange of ownership, possession, or rights related to products, services, or
assets. In a transfer, A gives something to B but does not receive anything
tangible in return. When A gives B a gift, a subsidy, or a charitable
contribution, it is called a transfer.
4. Exchange, Transactions and Transfer :

10. 1. Segmentation: - It is dividing a market into distinct groups of buyers with different
needs, characteristics, behaviors who might require separate product or marketing
mixes. Market segmentation is the identification of portions of the market that are
different from one another. It allows the firm to better satisfy the needs of its potential
customers.
2. Target market: - A segment or segments of a mass market selected by the
management for business is called target market. A target market is the specific group
of people you want to reach with your marketing message. They are the people who
are most likely to buy your products or services, and they are united by some common
characteristics, like demographics and behaviors.
3. Positioning: - Positioning/ product positioning generally means the act of building the
company’s, image and value in the market. More specifically, product positioning can
be defined as the place a product occupies in consumers’ minds relative to competitors
offerings.
5. Segmentation, Target Market and Positioning :

11. Market
• 'Market' was derived in English from Latin word 'Marcatus'
which can be translated into a place where the business is
conducted.
• Markets have existed since the first human civilization where
people would barter their goods and services.
• As civilizations have evolved, so have the markets. Markets
continue to grow and evolve from a place where people would
barter their goods and services to selling goods and services
online.
• Ideally a market is a place where two or more parties are
involved in buying and selling. The two parties involved in a
transaction are called seller and buyer.
• The market may be physical like a retail outlet, where people
meet face-to-face, or virtual like an online market, where there
is no direct physical contact between buyers and sellers.

12. • Marketing management is the process of decision making, planning,
and controlling the marketing aspects of a company in terms of the
marketing concept, somewhere within the marketing system.
• According to Philip Kotler, “Marketing Management is the art and
science of choosing target markets and building profitable relationship
with them. Marketing management is a process involving analysis,
planning, implementing and control and it covers goods, services,
ideas and the goal is to produce satisfaction to the parties involved”.
• Marketing Management performs all managerial functions in the field
of marketing. Marketing Management identifies market opportunities
and comes out with appropriate strategies for exploring those
opportunities profitably.
• It has to implement marketing programme and evaluate continuously
the effectiveness of marketing-mix. It has to remove the deficiencies
observed in the actual execution of marketing plans, policies, and
procedures. It looks after the marketing system of the enterprise.
Marketing Management

13. 1. Production Concept
2. Product Concept
3. Selling Concept
4. Modern/New Marketing Concept
5. Societal Marketing Concept
6. Holistic Concept

Company Orientation towards the Market Place

14. • The production concept holds that consumers will favor products that are available and
highly affordable.
• This philosophy assumes that consumers buy those products which are widely available
and have affordable cost.
• Therefore, management should focus on improving production and distribution
efficiency. This philosophy is also called manufacturing-oriented philosophy.
• In Nepal organizations like Biscuit Company, Toffee Company etc. base their marketing
activities on such concept.
• Goldstar company follows this concept.

15. • 1. Production Oriented
• The production concept gives emphasis to mass production
and mass selling.
• 2. High Production Efficiency
• The production concept believes that high production
efficiency can be achieved through the use of modern technology,
standardization and large-scale production.
• 3. Low Price
• The production concept believes that price of products should
be cut down to attract customers.
• 4. Wide Distribution
• Arrangement for wide sales and distribution should be made
to make the product available everywhere.
Features Of Production Concept of Marketing

16. • The product concept holds that consumers will favor products that offer the most in
quality, performance, and innovative features.
• The business philosophy known as “the product concept” is based on perception that the
consumer or customers are interested more in the quality and performance of the product
or the service rather than its volume of production or price.
• They prefer to purchase products with higher quality and performance.
• Example – Apple is one company which works highly on product concept to get the best
products to their consumers. Apple's products are perceived to be very high quality with
innovative features and great performance.

17. • 1. Emphasis on Product
• Quality Product concept of marketing gives emphasis to produce
quality goods in large quantity.
• 2. Reasonable Price
• The product concept believes that no hard effort needs to sell quality
products at reasonable price.
• 3. No Concern With Customers' Need
• The product concept does not care for customers' needs, wants or
interest, preference etc. rather it focuses attention on producing quality
and durable goods at lower cost.
• 4. Quality Improvement
• The product concept believes that quality product should be
improved to attract customers.
Features Of Product Concept of Marketing

18. • This concept was very popular in between 1930- 1950 A.D. The selling
concept holds that consumers will not buy enough of the firm's product
unless it undertakes a large-scale selling and promotion effort.
• In this concept, it is assumed that buyers do not normally think of buying, so
the manufacturer should manage aggressive selling and heavy promotional
activities.
• The objective of the organization is to sell what they make rather than what
the market wants. It focuses on creating sales transactions rather than on
building long-term profitable relationships with customers.
• Life Insurance companies, Political Marketing, Encyclopedia Publications etc.
gives emphasis to selling concept.

19. • 1. Selling-Orientation
• Selling concept of marketing gives emphasis to fulfillment of needs of
the sellers, it believes that product must be sold out.
• 2. Aggressive Selling and Promotion
• Aggressive sale promotional activities should be conducted to attract
customers. Only care is taken to increase sales quantity in the market.
• 3. No Concern with Consumers' Needs
• Selling concept is not concerned with the consumers' needs. It lays
emphasis on how to sell goods but not on what kind of goods should be
produced for the customers.
• 4. Customer Persuasion
It persuades customers to buy goods convincing them about the high
quality and price of the products.
Features Of Selling Concept of Marketing

20. • The marketing concept holds that achieving organizational goals depend on knowing
the needs and wants of target markets and delivering the desired satisfactions better
than competitors.
• Integrated marketing – Products, services and marketing should work hand in hand
towards to growth of the organization.
• Under the marketing concept, customer focus and value are the paths to sale and
profits. Instead of a product-centered “make and sell” philosophy, the marketing
concept is a customer-centered "sense and respond” philosophy.
• i.eThe managers practicing this philosophy emphasized the slogan "we make what
we can sell".
• The job is not to find the right customers for your product but to find the right
products for your customers.

21. 1. Well-defined Target Market
The marketing concept clearly defines target market of the
organization remains effortful to conduct more attractive and effective
programs than the competitors.
2. Focus on Customer Needs
The marketing concept pays attention to identify the
customers and provide them. So, it gives emphasis to create goods
that can satisfy the customers.
3. Integrated Activities
The marketing concept believes that customers' needs can be
satisfied through integrated and coordinated activities.
4. Organizational Goal
The goal of an organization can be achieved by only through
customers' satisfaction.
Features Of Modern/New Marketing Concept of Marketing

22. • The societal marketing concept holds that marketing strategy should deliver value to
customers in a way that maintains or improves both the consumer's and society's well-
being.
• The societal marketing concept suggests that the organization should determine the
needs, wants, and interests of target markets and deliver the desired satisfactions more
effectively and efficiently than the competitors.
• Coca-Cola releases an ad that shows people of different ethnicities and singing “America
is Beautiful” in different languages.
• Ariel is a detergent produced by Procter and Gamble. Ariel runs special fund raising
campaigns for less privilege classes of the world, mainly the developing countries. It also
contributes a share of its profits from every bag sold for the societal development.

23. • 1. Social Responsibility Orientation
• A business firm should bear social responsibility to increase consumers' interest and
social welfare.
• 2. Customer Need Satisfaction
• The societal marketing concept believes in supplying better quality goods than those
of competitors to satisfy the needs of target customers.
• 3. Integrated Marketing Efforts
• The societal marketing concept gives emphasis to integration and coordination
among all the organizational activities and efforts.
• 4. Profit through Social Well-being and Consumers' Welfare
• Proper harmony is compulsory among social well-being, supply of customers'
needs, profit earning and other objectives of any business organization. In other words,
societal marketing concept believes that profit can be earned only through proper care
for the interest and well-being of the society, consumers and firm itself.
Features of Societal Concept of Marketing

24. • Today's marketing is complex and comprehensive. Nowadays, people's need and
demand are inter-related with various dimensions of the life.
• Thus, it is essential to make marketing plans and programs in a co-ordinated manner
which is known as holistic marketing.
• Samsung is an example of Holistic marketing where the products are developed
keeping the customer in mind, The showrooms are branded in the proper manner,
the customer service is polite and the service is fast. Thus Samsung is an excellent
example of Holistic marketing.
• Ncell and CG Group in Nepal follows this concept.

25. • 1. A Common Goal
• Holistic marketing concept believes that the business and all its parts
should focus towards one single goal which is a great customer
experience.
• 2. Aligned Activities
• All of the services, processes, communication and other business
activities should be directed towards that common goal.
• 3. Integrated Activities
• All activities should be designed and integrated in such a way so as to
create a unified, consistent and seamless customer experience.
Features of Holistic Concept of Marketing

26. Capturing Customer Value from
Customers

27. S.
tep 1: Understanding the Marketplace and Customer Needs
• Understanding the marketplace and customers’ needs, wants, and demand is the first step to create
value for customers and build a customer relationship.
• Need refers to basic things that a human has to have in order to survive. Some of human needs are
physical needs like food, clothing, and shelter, social needs like belonging and affection, and
individual needs like learning, knowledge, and self-expression. In contrast, want refers to the form
of human needs that are shaped by culture and individual. Wants are something that an individual
like to have. Finally, wants to be backed by buying power that makes up
customer’s demand. Needs and wants are fulfilled through marketing offer.
Step 2: Designing a Customer-Driven Marketing Strategy
• After realizing marketplace and customer needs and wants, a successful company must design a
customer-driven strategy that builds a profitable relationship with the customer. In this step, the
marketing manager must answer two fundamental questions of: what customers will the company
serve? (What’s its target customer?) and how can the company serve this customer best? After
selecting segments of customers and target market, the manager chooses a brand’s value
proposition. A value proposition is set of the benefits and values that company promises to deliver
in order to satisfy customer needs. While designing a customer-driven marketing strategy,
marketers will address the following philosophy to carry their marketing strategies:
• The production concept
• The Product concept
• The selling concept
• The marketing concept
• The social marketing concept
• The Holistic Concept

28. S.
tep 3: Preparing an Integrated Marketing Plan and Program
• In this step, companies must construct integrated marketing program that delivers superior value to their
customers. For this purpose, companies insert their marketing strategy through 4ps of marketing, product, price,
place, and promotion.
• Product is a need-satisfying market offering that delivers companies value proposition
• Price is the value of the offered product
• Place makes the offer available for the target market by distribution
• Promotion is persuasive ways of communication that convince customers to buy that product
Example: "Apple’s marketing plan integrates product innovation, premium pricing, selective distribution, and
persuasive advertising to deliver superior value to tech-savvy consumers."
Step 4: Building Customer Relationship
• In the next step, companies build profitable relationships and create customer delight through a selective
relationship management. Customer relationship management (CRM) builds and maintains the profitable
relationship by delivering superior customer value and satisfaction. Delivering an expected quality which the
company promised to deliver attracts and retains customers. Some companies, however, decide to deliver products
higher than expectations which delight their customers.
Example: "Starbucks builds strong customer relationships by offering personalized rewards and exceptional service,
creating brand loyalty among its customers."
Step 5: Capturing Value from Customers
• Creating and capturing customer value is the final step in the marketing process. Successful companies try to
delight their customers and capture value from customers. By capturing customer value, firms build a long life
relationship with their customers. Satisfied customers tend to buy more and to be loyal to the company which
leads greater long-run profits. To aim the positive outcome of creating value, companies tend to create customer
loyalty and retention to capture customer lifetime value.
Example: "Amazon captures customer value by offering convenience and personalized recommendations, which leads
to repeat purchases and long-term loyalty."

29. • Developing the marketing strategies and plans:
A marketing manager has to identify consumer needs and wants, deliver
them by adding value to the products and communicate superior value.
Strategic planning is a managerial process of developing and maintaining
balance between organizations’ objectives, skills, resources, and its
changing marketing opportunities. Strategic planning takes place at four
levels: corporate, division, business unit and product.
• Monitoring marketing environment:
Managers must identify trends and convert them into opportunities. With
the changing global scenario, marketers must monitor six major
environmental forces. They include demographic, economic, socio-
cultural, natural, technological, political and legal forces.
• Marketing research:
In addition to monitoring marketing environment, managers also need
company-specific knowledge. Specific knowledge can be related to their
product, company’s market, target consumer group and response to their
communication efforts. Thus, modem marketing managers either hire
professionals or undertake marketing research.
Role of marketing manager in the current scenario

30. Continued…..
• Creating customer value, satisfaction and loyalty:
Customers are value maximizers. They buy from the firms that they feel offer highest
customer delivered value. Thus, utmost importance has to be given to quality
management programmes. This will build customer loyalty.
Customer relationship management is a process of managing detailed information
about individual customers and using them to build customer loyalty. Digital
technology has made it easy to conduct one-to-one marketing in place of mass
marketing.
• Market segmentation:
Modem markets are not homogeneous. A company cannot connect with all the
customers in a large and diverse market. Consumers can be grouped according to one
or more characteristics. A marketing manager identifies the market that can be served
efficiently. Such decisions require a deep understanding of consumer behaviour.
• Dealing with competition:
Competition has intensified and taken new dimensions. New competition is coming
from global marketers, online marketers, private label marketers and brand extension of
mega brands. Thus, a company’s marketing manager has to identify the competitor’s
strategies, objectives, strengths, and weaknesses. But too much emphasis should not be
given to competition alone. The modem managers must maintain a good balance of
consumer and competitor monitoring.

31. Marketing Challenges in the 21st Century
• Digital Transformation:
• In the 21st century, the pervasive influence of digital technologies has fundamentally reshaped the
marketing landscape. Companies face the challenge of adapting to this digital transformation by embracing
online platforms, utilizing data analytics for informed decision-making, and ensuring a seamless and
engaging digital customer experience. Strategies must evolve to encompass social media marketing,
content optimization, and harnessing the power of emerging technologies like artificial intelligence to stay
competitive in the digital era.
Eg: "Daraz Nepal’s online shopping platform and personalized recommendations have revolutionized digital
shopping for Nepali consumers."
• Increased Competition:
• Globalization and technological advancements have ushered in an era of heightened competition. The ease
of market entry allows new players to emerge rapidly, making it challenging for brands to differentiate
themselves. To stand out, businesses must focus on innovation, build distinctive brand identities, and
communicate unique value propositions that resonate with their target audiences. Successful strategies
involve understanding market dynamics, anticipating trends, and continuously adapting to changing
consumer preferences.
Eg:"Xiaomi and Realme's rise in Nepal has pushed brands like Samsung to innovate and offer more
competitive pricing."
• Changing Consumer Behavior:
• Shifts in consumer behavior, driven by factors such as increased connectivity and access to information,
demand a more nuanced marketing approach. Consumers today are informed, empowered, and seek
personalized experiences. Marketers must invest in deep customer insights, leverage data to customize
marketing efforts, and establish transparent and authentic communication to build and maintain trust.
Eg:"Young Nepali consumers are increasingly drawn to personalized offers and discounts via social media
platforms."

32. Continued…
• Data Privacy and Security:
• As digital interactions become more prevalent, concerns about data privacy and security have become
paramount. Stricter regulations and growing consumer awareness necessitate that businesses adhere to robust
data protection practices. Building and maintaining trust requires transparent communication about data usage,
implementation of stringent cybersecurity measures, and compliance with relevant privacy regulations.
Eg:"Digital payment platforms like eSewa and Khalti are ensuring stringent data security to build consumer trust in
Nepal."

• Adapting to Social and Cultural Trends:
• The dynamic nature of social and cultural trends presents a challenge for marketers aiming to stay relevant.
Companies must be attuned to changing societal norms, engage in purpose-driven marketing aligned with
values, and demonstrate cultural sensitivity. Aligning marketing campaigns with diverse perspectives and
societal shifts helps build a brand image that resonates positively with the target audience.
Eg:"Brands like Himalaya Herbal cater to Nepali cultural values by promoting wellness and using locally relevant
messaging."

• Omni-Channel Marketing:
• Consumer expectations for a seamless experience across various channels require marketers to adopt omni-
channel strategies. This involves integrating marketing efforts across physical stores, online platforms, and
other touchpoints to ensure consistency in messaging and customer experience. The use of analytics is crucial to
understanding customer journeys and optimizing strategies across all channels.
• Eg:"Bhat-Bhateni Supermarket’s integration of online and offline shopping ensures a seamless customer
experience across channels."

• Shorter Product Life Cycles:
• The rapid pace of innovation in products and services shortens their life cycles, posing challenges for marketers
to continually introduce new offerings. Adapting to this dynamic environment involves fostering a culture of
innovation within the organization, investing in research and development, and creating agile marketing
strategies capable of responding quickly to changing market demands.
Eg: "Samsung Nepal launches new smartphone models frequently to stay competitive in the fast-evolving tech
market."

33. Firm’s Responses To Marketing Challenges
• 1. Digital Transformation:
• Response: The firm recognizes the importance of digital transformation in today's market and has
adopted a proactive approach. It invests in digital marketing strategies, utilizes data analytics for
informed decision-making, and ensures a seamless online customer experience. The company
embraces social media platforms and leverages emerging technologies like artificial intelligence to
stay at the forefront of the digital landscape. Example: "Daraz Nepal, for example, proactively
invests in digital marketing, data analytics, and social media platforms to offer a seamless online
shopping experience."
2. Increased Competition:
• Response: In response to heightened competition, the firm focuses on differentiation strategies. It
continually innovates its products and services, building strong brand identities that resonate with
its target audience. By understanding market dynamics, anticipating trends, and adapting to
changing consumer preferences, the company positions itself as a unique and compelling choice in
a crowded marketplace. Example "To stand out in a competitive market, brands like Samsung
Nepal, for example, focus on continuous innovation and creating unique value propositions for
consumers."

3. Changing Consumer Behavior:
• Response: The firm understands the shift in consumer behavior and tailors its marketing approach
accordingly. It invests in obtaining deep customer insights, utilizing data for personalization, and
establishing transparent communication to build and maintain trust. The company prioritizes
delivering personalized experiences to meet the expectations of informed and empowered
consumers. Example "Companies like Unilever Nepal, for example, are adapting by personalizing
their marketing strategies through customer insights and transparent communication to build
trust."

34. .
4. Data Privacy and Security:
• Response: Recognizing the significance of data privacy and security concerns, the firm has implemented
stringent measures to protect customer data. It complies with relevant privacy regulations, communicates
transparently about data usage, and invests in robust cybersecurity practices. Building and maintaining
customer trust is a priority, and the company takes a proactive stance on data protection. Example Example:
"eSewa Nepal, for example, ensures stringent data protection measures, complies with privacy regulations,
and transparently communicates its data usage policies to maintain user trust."

5. Adapting to Social and Cultural Trends:
• Response: The firm actively monitors social and cultural trends to stay relevant. It engages in purpose-driven
marketing aligned with societal values, demonstrating cultural sensitivity. By aligning campaigns with diverse
perspectives and societal shifts, the company establishes a positive brand image that resonates with its target
audience. Example Example: "Brands like Patanjali Nepal align their campaigns with local cultural values,
promoting wellness and traditional remedies to resonate with Nepali consumers."

6. Omni-Channel Marketing:
• Response: To address the demand for a seamless customer experience across channels, the firm adopts omni-
channel marketing strategies. It integrates marketing efforts across various touchpoints, ensuring consistency
in messaging and customer experience. The use of analytics is prioritized to understand customer journeys
and optimize strategies across all channels. Example Example: "Bhat-Bhateni Supermarket, for example,
integrates online grocery shopping with its physical stores, providing a consistent experience across all
customer touchpoints."

7. Shorter Product Life Cycles:
• Response: Faced with shorter product life cycles, the firm fosters a culture of innovation. It invests in
research and development to introduce new offerings swiftly, staying ahead of market trends. The company's
agile marketing strategies allow it to adapt quickly to changing consumer demands, ensuring a continuous
stream of innovative products and services. Example Example: "Samsung Nepal, for example, regularly
launches new models of smartphones to stay ahead in the rapidly evolving tech market and meet consumer
demands."

35. i


















• Marketing Environment refers to all internal and external
factors, which directly or indirectly influence the
organization’s decisions related to marketing activities.
• SWOT Analysis.
• Internal environment provides Strengths(S) and Weaknesses
(W) to the marketers.
• External environment provides Opportunity (O) and Threats
(T) to the marketers.

36. • Concept of Marketing Environment
• Various environmental factors affect the way a business is operated. These environmental factors can be
divided into two broad categories, such as the internal (Micro) environment and the external
(Macro) environment. The marketing environment refers to all micro and macro factors, which
directly or indirectly influence the organization’s decisions related to marketing activities. In other
words, a firm is surrounded by internal and external force which has a great effect on firm’s ability to
maintain lasting relations with target customers. It is essential to know both internal as well as external
environmental factors. Internal/Micro environment provides Strengths(S) and Weaknesses (W) to the
marketers whereas external/macro environment provides Opportunity (O) and Threats (T) to the marketers.

• The marketing environment of a business consists of an internal and an external environment. The internal
environment is company-specific and includes owners, workers, machines, materials etc. The external
environment is further divided into two components: micro & macro. Internal factors are within the control
of an organization; whereas, external factors do not fall within its control. The external factors include
government, technological, economic, social, and competitive forces; whereas, organization’s strengths,
weaknesses, and competencies form the part of internal factors.
Marketing Environmental Trend and forces

37. Specific and General Forces
Complexity
Vibrancy/Dynamic
Uncertainty
Relativity
Multi-faceted
Provides SWOT


Features of Marketing Environment

38. • Specific and General Forces
It refers to different forces that affect the marketing environment. Specific forces include those forces,
which directly affect the activities of the organization. Examples of specific forces are customers and
investors. General forces are those forces, which indirectly affect the organization. Examples of
general forces are social, political, legal, and technological factors.
• Complexity
Marketing environment is complex and very difficult to predict. Complexity nature of marketing
provides uncertainty to marketers. It implies that a marketing environment includes number of factors,
conditions, and influences. The interaction among all these elements makes the marketing environment
complex in nature. Example: "The unpredictable political environment in Nepal often leads to changes
in consumer buying patterns, making it challenging for marketers to predict demand."
• Vibrancy/Dynamic
Vibrancy implies the dynamic nature of the marketing environment. A large number of forces outline
the marketing environment, which does not remain stable and changes over time. Marketers may have
the ability to control some of the forces; however, they fail to control all the forces. However,
understanding the vibrant nature of marketing environment may give an opportunity to marketers to
gain edge over competitors. The marketer needs to research about every aspect of the environment to
create a full-proof plan. Example: "The recent shift towards online shopping in Nepal due to the
COVID-19 pandemic highlights the dynamic nature of the market, with brands like Daraz Nepal
rapidly adjusting their strategies to meet growing demand for e-commerce."
Features of Marketing Environment

39. Continued…
• Uncertainty
It implies that market forces are unpredictable in nature. Every marketer tries to predict market forces to
make strategies and update their plans. It may be difficult to predict some of the changes, which occurs
frequently. For example, customer tastes for clothes change frequently. Thus, fashion industry suffers a
great uncertainty. The fashion may live for few days or may be years.

• Relativity
It explains the reasons for differences in demand in different countries. The product demand of any
particular industry, organization, or product may vary depending upon the country, region, or culture. For
example, sarees are the traditional dress of women in Nepal, thus, it is always in demand. However, in
any other western country the demand of saree may be zero.

• Multi-Faceted
Marketing environment is multi-faceted. Firms perceive environmental changes similar to all in a quite
different manner. A similar change in environment can be a threat to a firm while a great opportunity for
other firms. For example Load-shedding, Technological advancements, etc.

• Provides SWOT
The marketing environment is related with strengths, weaknesses, opportunities and threats (SWOT).
SWOT analysis can help the marketers by creating a visual representation of the various factors that are
most likely to impact their business and help them successfully achieve their desired objective.

40. • The marketing environment is made up of the internal and external environment of the business. While the
internal environment can be controlled, the business has very less or no control over the external environment.
A. Internal Environment (Micro Environment)
• The internal environment of the business includes all the forces and factors inside the organization which affect
its marketing operations. The internal environment is under the control of the marketer and can be changed with
the changing external environment. Internal/Micro environment provides Strengths(S) and Weaknesses (W) to
the marketers.
Components of internal environment: (Micro Environment)
a) The Company
• One of the most important aspects of the micro environment of an organization is the self-analysis of the
company itself. It must understand its own strengths and weaknesses, objectives and goals of the business, and
resource availability. A company is made up of various levels of management like top, middle and lower level
management. These have many departments like production finance, human resources, marketing, research and
development etc. Marketing strategies, policies and plans are drawn up according to the philosophy (thinking and
ideas) of top management.
b) Customers
• A customer may be an individual or household, an organization, government and global customers that purchase
a product for consumption or use in the production of other products or for resale. The requirements of these
customers differ in quality, quantity, timing, price etc. Marketing specialists, or marketers, develop and market
messages to appeal to a company's customers' needs. All the marketing activities begin and end with customer.
Marketers must aim to retain existing customers and attract new customers.
c) Suppliers:
• Suppliers are the one who provides inputs such as material, components, labour and other stock of goods to the
firm, which is required to undertake manufacturing activities. It is quite common that the cost, quality, pricing
and delivery decisions are affected by suppliers’ policies. But, with cordial relations with suppliers, these can be
partially controlled. In case, the suppliers increase the price of raw materials, a company’s price of final products
also changes. Similarly, the cash term or credit period allowed by suppliers also affect cost of production and
inventory decisions. It is crucial to identify all the relevant suppliers and to develop good relationships with
them.
Forces/Classification/Components of Marketing Environment

41. d) Competitors
• Competitors are the rival sellers operating in the same industry. It must be noted that the
nature and intensity of competition highly influence the firm’s products and services. For a
firm to survive competition it is required to keep a close watch on the competitors (both
existing and potential). Hence, it is important that an organization is aware of its
competitors and in a position to analyze threats from its competition. A firm’s marketing
policies are affected by competitor’s policies. For example, Dove and Sunsilk
shampoo companies are direct competitors.
e) Marketing Intermediaries
• Market intermediaries are either individuals or business houses who come to the aid of the
company in promoting, selling and distributing the goods to the ultimate consumers. It acts
as a link between the business organization and the ultimate consumer. Organizations
typically rely on banks, and other sources to finance operations; wholesalers and retailers,
warehouses and transportation companies to distribute goods; and advertising, market
research firms and public-relations firms to market their products. The marketing strategy
is defined in part on the degree to which each intermediary can potentially increase or
decrease customer satisfaction.
f) Public
• Literally word ‘public’ refers to people in general. The public is people other than the target
audience of the organization. The public plays a vital role in the success of the business as
it can build or destroy the image of a company in the market. The public has the power to
influence the purchasing decision of the target audience. The environmentalists, consumer
protection groups, labour unions, media persons and local people are some of the well-
known examples of publics. Organization should formulate marketing strategies which
eventually result in the collective benefit and welfare of the public which your business is
part of. The public has the power to help company reach its goals; just as they can also
prevent from achieving them.

42. 2. External Environment (Macro Environment)
• The external environment constitutes factors and forces which are external to the business and
on which the marketer has little or no control. External/macro environment provides Opportunity
(O) and Threats (T) to the marketers.
• It constitutes the external factors and forces which affect the industry as a whole but don’t have a
direct effect on the business. The macro-environment can be divided into 6 parts.
a. Demographic Environment
Demographic environment is the scientific study of human population in terms of elements, such as
age, gender, education, occupation, income, and location. It also includes the increasing role of
women and technology. These elements are also called as demographic variables. Before marketing a
product, a marketer collects the information to find the suitable market for the product. Demographic
environment is responsible for the variation in the tastes and preferences and buying patterns of
individuals. The changes in demographic environment persuade an organization to modify marketing
strategies to address the altering needs of customers.
b. Economic Environment
The economic environment constitutes factors which influence customers’ purchasing power and
spending patterns. In other words, the purchasing power of a customer depends on the current
income, prices of the product, savings, and credit availability. These factors include the GDP, GNP,
interest rates, inflation, income distribution, government funding and subsidies, and other major
economic variables.
c. Political-Legal Environment
Political and legal environment consists of legal bodies and government agencies that influence and
limit the organizations and individuals. It also includes other pressure groups and agencies which
influence or limit the working of the industry and/or the business in the society. Every organization
should take care of the fact that marketing activities should not harm the political and legal
environment prevailing in a country. The political and legal environment has a serious impact on the
economic environment of a country.

43. d. Socio-Cultural Environment:
Socio-cultural environment comprises forces, such as society’s basic values, attitudes, perception, and
behavior. These forces help in determining that what type of products customers prefer, what influences the
purchase attitude or decision, which brand they prefer, and at what time they buy the products. The socio-
cultural environment explains the characteristics of the society in which the organization exists. The analysis
of socio-cultural environment helps an organization in identifying the threats and opportunities in an
organization.For example, the lifestyles of people are changing day-by-day. Now, the women are perceived
as an active earning member of the family. If all the members of a family are working then the family has
less time to spend for shopping. This has led to the development of shopping malls and super markets,
where individuals could get everything under one roof to save their time.

e. Technological Environment
Technology contributes to the economic growth of a country. It has become an Indispensible part of our
lives. Organizations that fail to track ongoing technological changes find it difficult to survive in today’s
competitive environment. Technology acts as a rapidly changing force, which creates new opportunities for
the marketers to acquire the market share. Marketers with the help of technology can create and deliver
products matching the life style of customers. Thus, marketers should observe the changing trends in
technology. Technology is one of the biggest sources of threats and opportunities for the organization and it
is very dynamic.
f. Physical/Natural Environment
The physical environment includes the natural environment in which the business operates. Natural
environment consists of natural resources, which are needed as raw materials to manufacture products by
the organization. The marketing activities affect these natural resources, such as depletion of ozone layer
due to the use of chemicals. The corrosion of the natural environment is increasing day-by-day and is
becoming a global problem.

44. Meaning
• Marketing plan refers to developing marketing strategies that will help the company
accomplish its overall strategic objectives. A detailed marketing plan is required for each
business, product, or brand.
• Marketing planning;
➢ involves an assessment of where the company stands in the marketplace;
➢ is a determination of where the company wants to be in the future;
➢ the creation of marketing actions designed to achieve that future desired position; and
➢ a provision of determining how the effectiveness of those actions will be evaluated at
the end of the operating period.
For eg, if any company wants to sell 200,000 LED television during FIFA World
Cup 2022, the production department must be ready to achieve that production level.
Finance department must arrange expenses and human resource department must have proper
human resource management for successful implementation of that marketing plan.
Without the support of top level management, other functional management and resou
rce availability, no marketing plan can succeed.
Planning is becoming a continuous process in order to respond to rapidly changing market
conditions.
Nature And Contents Of A Marketing Plan

46. .
1. Executive Summary
• The executive summary is the opening section of the marketing plan. It
presents a summary of the main goals and recommendations to be presented in
the plan. The executive summary helps top management to locate the plan’s
major points quickly. A table of contents should follow the executive summary.
Example: "Daraz Nepal aims to increase market share by 15% in the next year
through enhanced user experience, product expansion, and targeting rural
consumers."

2. Current Marketing Situation
• The current marketing situation is the first major section of the plan. It
describes the target market and the company’s position therein. This section
contains information about the market, product performance, competition, and
distribution. It contains a market description that defines the market, including
major market segments. Example: "Daraz leads Nepal’s e-commerce market
but faces growing competition from local platforms."

47. .
3. Threats and Opportunities
In this section, the planner lists as many threats and opportunities as anticipated that the product might
face. This section enables the manager to anticipate important developments that might affect the
company. An increase in the number of competitors and the introduction of new products are examples
of threats. In contrast, the improvement of economic conditions and product innovation are examples
of opportunities that have important implications for a marketer. Threats and opportunities should be
carefully analyzed from the company’s standpoint so that the managers might develop proper
strategies to counter these threats and exploit these opportunities. Example: "Opportunity: Increasing
internet access in rural areas. Threat: Rising competition from local e-commerce sites."

4. Objectives and Issues
Analysis of threats and opportunities leads the marketer towards setting objectives and consider issues
that will affect them.The objectives should be stated in terms of goals the company would like to attain
during the plan’s period. Example: "Daraz Nepal's primary objective is to expand its customer base by
15% in the next year, but a key issue is ensuring that its logistics network can support growth in rural
and remote areas, where delivery challenges exist."

48. .
5. Marketing Strategies
• In this section of the marketing plan, the manager outlines the broad marketing
strategy or ”game plan” for attaining the objectives. Marketing strategy is the
marketing logic by which the business unit hopes to achieve its marketing
objectives. It consists of specific strategies for target markets, positioning, the
marketing mix, and marketing expenditure levels. The marketing strategy
should detail the market segments on which the company will focus. Example:
"Strategy: Focus on personalized marketing, social media campaigns, and local
vendor partnerships."

6. Action Programs
• Marketing strategies should be translated into specific action programs that will
indicate what to do and when and by whom it will be done and its cost. The
action plan indicates when activities will be started, reviewed, and completed.
Example: "The action plan includes launching a digital marketing campaign by
the end of Q1, setting up regional warehouses to reduce delivery time, and
assigning specific teams to manage partnerships with local vendors."

49. .
7. Budgets
• Action plans allow the manager to make a supporting marketing budget that is essentially a
projected profit-and-loss statement. It shows the forecasted number of units that would be sold and
the average net price for revenues. On the expense side, it shows the cost of production, physical
distribution, and marketing. The difference is the projected profit. Top management will review the
budget and either approve or modify it. Once approved, the budget is based on materials buying,
production scheduling, personnel planning, and marketing operations. Budgeting can be very
difficult, and budgeting methods range from simple ”rules of thumb” to complex computer
models. Example: "Budget: NPR 3M for digital ads, NPR 2M for logistics, and NPR 1M for
vendor partnerships."

8. Controls
• Control is the last section of the marketing plan. It outlines the control methods that will be used to
monitor development. Goals and budgets are set for a specific time period. This allows the
management to review the results each period and identify businesses or products that are not
meeting their goals. Persons responsible for managing these businesses and products have to
explain these problems and the corrective measures. Example: "Controls: Monthly reviews to track
progress, with adjustments made for underperforming areas."

50. • The factors which affect the business marketing capabilities and strategies in Nepalese environment are: -
• Political: - The major strategies for any business in Nepal concerned with the political aspect are the lack of
strong and consistent government. For many decades, Nepal hasn’t been able to have a strong and consistent
government. Hence, the rise in corruption, unclear foreign policies, minimum economic development, etc.
affecting the marketing ability of foreign as well as national business organization.
• Legal: - The major fault in Nepalese legal system is the lack of clarity in many laws, rules and regulation. Nepal
has a very poor legislative and administrative system and it lead to delays and inefficiencies in obtaining
necessary permits and approvals.
• Economical: - Nepal an under developed nation has since the past many decade not been able to fit its
economic status. Due to various factors the economic performance of Nepal has been below poverty. There is an
increasing gap between the rich and poor, heavy dependence on remittance which will affect the performances
of the economy in the long run. The slow economic growth and increasing unemployment negativity affects the
marketing environment of Nepal.
• Socio-cultural: - The major portion of Nepalese population lives in rural areas with very small markets. High
numbers of population are uneducated. There is an increasing trend of domestic and international migration.
Major religion being HINDU and with joint family structure. The major numbers of population are very
traditional in thinking which affects the marketing strategies of business.
• Technological: - Nepal is far behind is use of contemporary technological. The level of Research and
Development is poor with very minimum level of technological transfer. There is heavy dependence of manual
labor and older technologies.
Contemporary Marketing Environment in Nepal

51. An automobile company is a leading manufacturing company in
its segment. The company has decided to launch fully solar
charged vehicles. This technology will cost the company 2000
cores annually. When the relationship manager of the company
was asked about the reason of bearing so much extra cost he
replied that the company considered environmental friendly
techniques as the only solution to increasing pollution. The
company feels by bearing extra cost it is fulfilling its
responsibility.

1. Identify the marketing management philosophy involved
in the following cases.
2. What is the decision taken by the company and why?
Case study exercise