MARKETING MANAGEMENT CONCEPTS AND NATURE.pptx

Marketing Management (CP-204)
BU, Bhopal unit-1

1. Concept: Marketing Management Marketing management is 'the art and science of choosing target markets and getting, keeping, and growing customers through creating, delivering, and communicating superior customer value. The concept reviews the process used to determine what products or services may be of interest to customers and the strategy to use for marketing mix. It also explores the process of understanding, creating and delivering value to targeted business markets and customers.

2. Definition Philip Kotler & Keller - "Marketing management is the art and science of choosing target markets and getting, keeping, and growing customers through creating, delivering, and communicating superior customer value“ Philip Kotler - “the analysis, planning, implementation and control of programs designed to bring about desired exchanges with target markets for the purpose of achieving organizational objectives”.

3. Nature of Marketing The Nature of Marketing (or Modern marketing) may be studied under the following points: Human activity:  Originally, the term marketing is a human activity under which human needs are satisfied by human efforts. It’s a human action for human satisfaction. Exchange Process:  All marketing activities revolve around commercial exchange process. The exchange process implies transactions between buyer and seller. It also involves exchange of technology, exchange of information and exchange of ideas.

4. Marketing is an Integrated Process: Marketing is not a single activity. It is rather a coordination of several inter-related activities. The interaction between different activities gives a unique character to marketing. Marketing is a managerial process in so far as it involves the functions of planning and control. Marketing is also a social process as it is concerned with the satisfaction of human needs and this is one of the most important Characteristics of Marketing.

5. Consumer-oriented:  A business exist to satisfy human needs, hence business must find out what the desire of customer (or consumer) and thereby produce goods & services as per the needs of the customer. Thus, only those goods should be produce that satisfy consumer needs and at a reasonable profit to the manufacturer (or producer). Art as well as science:  In the technological arena, marketing is the art and science of choosing target markets and satisfying customers through creating, delivering, and communicating superior customer value. It is a technique of making the goods available at right time, right place, into right hands, right quality, in the right form and at right price.

6. Starts and ends with customers:  Marketing is consumer oriented and it is crucial to know what the actual demand of consumer is. This is possible only when required information related to the goods and services is collected from the customer. Thus, it is the starting of marketing and the marketing end as soon as those goods and services reach into the safe hands of the customer. Creation of Utilities:  Marketing creates four components of utilities viz. time, place, possession and form. The form utility refers to the product or service a company offers to their customers. The place utility refers to the availability of a product or service in a location i.e. Easier for customers. By time utility, a company can ensure that products and services are available when customers need them. The possession utility gives customers ownership of a product or service and enables them to derive benefits in their own business.

7. Goal oriented:  Marketing seeks to achieve benefits for both buyers and sellers by satisfying human needs. The ultimate goal of marketing is to generate profits through the satisfaction of the customer. Guiding element of business:  Modern Marketing is the heart of industrial activity that tells what, when, how to produce. It is capable of guiding and controlling business.

8. System of Interacting Business Activities:  Marketing is the system through which a business enterprise, institution or organization interacts with the customers with the objective to earn profit, satisfy customers and manage relationship. It is the performance of business activities that direct the flow of goods and services from producer to consumer or user. Marketing is a dynamic process . series of interrelated functions: Marketing is a complex, continuous and interrelated process. It involves continuous planning, implementation and control.

9. Marketing is Pervasive: marketing is required in business as well in social and other organizations. In other organizations, marketing is necessary for spreading socially useful ideas and programs family planning, adult education, communal harmony, national integration, environmental protection, etc. Such marketing is called social marketing. Know Your Market: It is important to know your market and your customers. If you are advertising a product for elderly citizens, you wouldn’t want to advertise in certain markets or on certain radio stations or during certain television shows. Knowing who you might be advertising to is of a great help to get more customers. Easier said than done actually, but if you know your market it doesn’t have to be that hard. Know Your Customers: This goes along with number 8. Not only do you have to know your market, you also have to know your customers, possible customers and your customer base. For example, if you are advertising car repair supplies, you might want to advertise on sports talk stations instead of an all ladies channel

10. Marketing environment A marketing environment encompasses all the internal and external factors that drive and influence an organization's marketing activities. Marketing managers must stay aware of the marketing environment to maintain success and tackle any threats or opportunities that may affect their work

11. . A company's marketing environment includes every element that may affect its ability to connect with its customers. This can include internal elements such as resources, equipment and a company's corporate structure. It can also include external components like existing customers, delivery platforms and top competitors. Both internal and external conditions can affect how a customer responds to a business and determine how a business might grow. Some benefits of understanding your marketing environment include: Assisting you in understanding the company's competitors and the market Supporting you in identifying your current and potential customers Helping you determine future marketing plans Aiding you in assessing current trends

12. Types of marketing environments Here are the three main types of marketing environments: Internal marketing environment : Marketing professionals work with the resources, company values, systems and processes that exist within a company. These influence the tasks that a company's marketing and advertising teams complete and how effectively they can create campaigns and content to be competitive in a market.

13. External microenvironment:  An external microenvironment covers the relationships outside of the company. A company's external contacts may include customers, suppliers or other outside agencies. External macro environment:  The term macro environment refers to the market or field in which a company performs. While macro factors may affect the entire industry, they rarely have a direct impact on a specific company.

14. 7 elements of macro-marketing environments 1. Demographic environment Demography is the study of populations. The demographic environment for a company encompasses the people who are part of a specific market. This environment includes the size and density of a particular population and the common occupations people have. It also covers the age, race and gender of prospective customers in a demographic group. Understanding the company's demographic environment can help you adjust marketing strategies, develop products and target advertising effectively. Some factors that companies might monitor to determine their demographic environment include population growth, population shifts and economic class shifts.

15. 2. Economic environment A company's economic environment refers to the factors that influence consumer buying habits and the company's performance. A company's economic environment may fluctuate based on government funding, credit availability, market trends, interest rates and shifts in the global economy. For example, an economic recession could negatively affect a business's profits, but an economic surplus might encourage customers to make larger purchases.

16. 3. Natural environment A natural environment, or physical environment, refers to both the location a business operates and the place it sources any natural resources it needs. For example, a lumber shortage is a natural marketing environment that may affect a construction business. Here are a few common factors that impact the natural environment of a business:A shortage or surplus of raw goods A fluctuation in the cost of energy A change in the quality of air Natural disasters Climate change A change in government policies Resource availability can often increase production costs, which may raise product prices and reduce a customer's purchasing ability. If a business is aware of its natural environment, it can adjust its processes and budgets accordingly.

17. 4. Technological environment A technological environment includes a specific market, technological equipment and innovative practices and products. Technology like laptops, automated machines and social media can all improve an organization's productivity and reach. In this type of marketing environment, it's important for companies to understand customer behavior. This can provide them with basic market information and help them determine if they need to develop additional technology to follow market trends. Companies may also gather information about customer behavior to help them evaluate and update their technology regularly.

18. 5. Political environment Changes in a country's national or local political situation can modify a company's external marketing environment. Politics might determine tariffs, regulations and other standards that affect the cost of purchasing goods and conducting business operations. Political environments may sometimes influence the global economy, which can alter the behavior of a market.

19. 6. Social environment A social environment refers to the way companies and consumers respond to social experiences. For example, an organization might donate a portion of its earnings to nonprofits or government agencies that help communities in need.The values, opinions and beliefs of a potential customer may change based on what they experience, who they interact with and what values they observe in a company. Learning about the customers' social needs and how it affects their shopping behaviors may help the company develop more effective advertising campaigns.

20. 7. Cultural environment Similar to social environments, a cultural environment refers to the way local communities interact with each other and your brand. Depending on the region, this type of marketing environment can vary widely. Some factors that influence a cultural environment include people's opinions about their community, other social groups and the company. For this reason, identifying and monitoring your customers' opinions can help the company adapt quickly to cultural shifts. This can help improve the success of the company's marketing efforts and show how the company's values align with the culture of its customers.

21. 6 elements of micro-marketing environments Micro-marketing environments often have a direct impact on business operations. Learning about the components of microenvironments can help a company decide how to handle conflicts and improve relationships with external partners and consumers. Here are some elements that comprise a micro-marketing environment:

22. 1. Suppliers Suppliers provide raw materials, services or goods to a company. The prices, service availability and product quality that a supplier offers can affect the cost and condition of products that customers purchase.Companies often consider their suppliers to be their partners and may expect suppliers to commit to delivering quality goods to customers. Researching a variety of suppliers can help the company determine which one may provide the product quality and prices your customers are seeking.

23. 2. Distributors and resellers Distributors help companies store and deliver their goods, often using warehouses. They also assist organizations by delivering products safely and on time. They may represent a specific brand, especially if they deliver to different outlets.Resellers may also deliver goods, but they often purchase them from a company first before selling them for a profit. For example, most retailers are resellers. To select the right reseller to work with, a company could consider which retailers best represent its brand and how that retailer might help it reach its target market. Companies often choose both distributors and resellers that have similar company values.

24. 3. Partners Partners are organizations that a company collaborates with to develop a product, deliver a service or provide a promotion. Typically, the members of a partnership include two or more companies that may operate in similar industries. However, a company may sometimes partner with a business from a different industry to expand its customer base.For example, a frozen food brand may partner with a soda company to offer consumers a discount when they purchase products from both brands. Each company has its own microenvironment and macroenvironment . In a partnership, the behavior of one company can directly affect the marketing environments of the other.

25. 4. Customers Customers exercise a major influence on a company's marketing environment. Companies may collect information about customer behaviors and opinions to help inform future business decisions.To manage this aspect of its marketing environment, a company may monitor the changes in customer preference and behavior and adjust its offerings as needed. For example, if a company receives negative feedback about a product, it might alter its product development practices.

26. 5. Competitors A company's competitors are part of its microenvironment because they directly affect daily business operations. A company can determine its position in the market to decide on strategies that can help it outperform its competition. Competing businesses often share customers, so it's helpful to monitor how the competitors are succeeding to understand ways that the company you work for might improve.

27. 6. The public The public includes any person who might engage with the company. The public can also include potential investors and people who refer new customers to the business. Understanding the public as a group of potential customers can help you target new markets to increase brand awareness.

28. Environmental Scanning The environment of a business is extremely dynamic in nature. It is always in a flux, i.e. constantly changing. Which means that the future of the business is also ever changing. And the organization must keep a close at its environment via environmental scanning. Let us learn the environmental scanning meaning.

29. In any business organization, there is an internal and external environment. They comprise all the factors that can affect the business of a company in any way. And they also present opportunities for the business to grow and threats that may harm the business. So these environments need constant monitoring. This is where environmental scanning comes into the picture. Environmental scanning meaning is the gathering of information from an organizations internal and external environments, and careful monitoring of these environments to identify future threats and opportunities. It is the analyses of all factors that may affect the future of the organization. Now that we know the environmental scanning meaning, let us see the purpose. The purpose of this process of environmental scanning is to provide the entrepreneur with a roadmap to the changes likely to happen in the future. So this way they can adapt the business to overcome the threats and capitalize on the opportunities coming their way.

30. Importance of Environmental Scanning 1] SWOT Analysis As we saw previously in the environmental scanning meaning, it is a complex process. The close study of the internal and external environment of an organization will reveal some very valuable information, i.e. the strengths, weaknesses, opportunities, and threats of a company. Let us take a brief look. Strength: After analysis of the internal environment of a company, we will be able to identify the strengths that give the company a competitive advantage. The entrepreneur can use this information to maximise these strengths and earn more profits.

31. Weakness: Study of the internal environment also point out the weaknesses of the company. For the growth and stability of the company, these identified weaknesses must be corrected without delay. Opportunity: Analysis of the external environment helps with the identification of possible opportunities. The entrepreneur can prepare to capitalize on these. Threats: Analysis of the external environment will also help in the identification of any business threats from competitors or any other factors. The company can come up with a strategy to diffuse such threats or minimize its impact.

32. 2] Best Use of Resources Environmental scanning helps us conduct a thorough analysis and hence leads to the optimum utilization of resources for the business. Whether it is capital resources, human resources or other factors of production, their best use and utilization is very important for any business. Environmental scanning will help us avoid any wastages and allow for the most effective and economical use of these resources.

33. 3] Survival and Growth of the Business It is a very competitive world and for any business to survive and thrive it is a difficult task. But if the business employs all the techniques of environmental scanning it can gain a significant advantage. It will allow the firm to prepare for future threats and opportunities while at the same time eliminating their weaknesses and improving on their strengths.

34. 4] Planning for Long Term A business must have a plan for both short term and long term. The planning of long-term objectives can only occur after proper analysis and environmental scanning meaning. This will help the entrepreneur plan the necessary business strategy.

35. 5] Helps in Decision Making Decision making is the choice of the best alternative done by management. Environmental scanning allows the firm to make the best decision keeping in mind the success and growth of the business. They point out all the threats and weaknesses. And they also identify the strengths of the firm.