Unit V- Marketing management

▪ Marketing management is the analysis, planning, implementation and control of

programmes designed to bring about desired exchanges with target markets in order to
achieve the objectives of the organization.

▪ The aim of marketing is to know and understand the customers so well that the product or
service fits himself and sells itself.

▪ Marketing is a human activity directed at satisfying needs and wants through exchange
process.

▪ Marketing is the performance of business activities that direct the flow of goods and
services from the producer to consumer.

▪ Marketing is a total system of interacting business activities designed to plan, promote and
distribute need satisfying products and services to the existing and potential consumer.
Functions of marketing Management:
▪ Marketing research.
▪ Sales forecasting.
▪ Advertising.
▪ Distribution channeling.
▪ Packing.
▪ Pricing.
Marketing Organization:
▪ Marketing has grown over years from sales department to a complex marketing
activities.
▪ Small companies appoint a sales manager who mange's a sales.
▪ As company expands it has to add the marketing functions.
▪ Medium and large scale companies invest in marketing research, new product
development, advertising and sales department, customer service.
Marketing Organization:
Marketing department may be organized by
▪ Functions: Sales, Marketing research, New product, Advertising, Sales promotion.
▪ Geographic organization: North, South, East and West.
▪ Products or Brands: Product A,B,C and so on.
Customer satisfaction:
Main focus is on the customer, a clear commitment to quality of product or service and
considerate mechanism for dealing with customer complaints should be their.

From point of view of customer satisfaction, following elements to be considered:

▪ Specification.
▪ Conformance to the specification.
▪ Reliability.
▪ Value.
▪ Timely delivery.
Environmental variables:
Environmental variables of the marketing are the variables affected by the
environmental forces.
▪ Customer variables: Number and location, purchasing power, buying behavior,
habits, lifestyles and needs, quality and brand awareness.
▪ Competition variables: Structure of industry, buyers or sellers market, nature of
competition, number of competitors, products offered by competitors, competitors
strength and weakness.
▪ Trade variables: Structure of trade, types of intermediate and their strengths, trade
practices, services provided by the trade.
▪ Other environmental variables: Govt regulations, Political variables, climate
variations, social cultural and economical variables.
Market planning:
It involves,
▪ Gathering the essential facts related to the market, consumer, competitors and
environment.
▪ To analyze its own resources and capabilities.
▪ To provide the frame work for all business decisions on markets, products,
manufacturing facilities, investments and organizational structure
▪ To seek to achieve the desired marketing objectives of the firm.

Marketing planning process:

▪ Analyzing the business environment an spotting the broad business opportunities
▪ Defining mission and settling objectives and goals.
▪ Find out strengths, weakness, opportunities and threats and convert them for firms
advantage.
▪ Developing the marketing strategy. Select target market and develop market mix.
▪ Formulate detailed functional plans and programmes, which includes plans for
sales, distribution, sales promotion, sales force and organization.
Market concept versus selling concept:
▪ Marketing concept states that a firm should have its basic objective, as the
satisfactory of consumer desires and need.
▪ Selling concept states that since consumers will normally not buy enough products of
the company unless they are approached with a substantially selling and promotion
efforts.
Marketing goals:
▪ Maximize consumption. As this will lead to create maximum production, wealth and employment.
▪ Maximize consumer satisfaction.
▪ Improve the quality of life by improving the quality, quantity, range and accessibility.

Duties of marketing manager:

Marketing mangers should see that the following functions are performed for goods to move from
manufacturers to consumers.
▪ Selling.
▪ Buying.
▪ Transportation.
▪ Storage.
▪ Risk bearing.
▪ Standardization and grading.
▪ Financing.
▪ Market information.
Marketing Strategy: A marketing strategy consists of two parts:
▪ Market segment.
▪ Marketing mix.

Marketing segmentation consists of identifying a sufficient number of common buyer

characteristics to permit subdivision of the total demand for the product into
economically viable segments

Marketing managers should identify the market segment, that is the target group of
persons to whom the firm wishes to appeal.

Identifying market segments and selecting target market: Major segmentation variables for
consumer markets are:
▪ Geographic ( Nation, region, state, City)
▪ Demographic ( Age, Family size, Gender, Income, Occupation, education, religion)
▪ Psychographics ( Life style, Personality)
▪ Behavioral ( Benefits, attitude, user status)
Marketing Mix: It consists of market plan that will satisfy the
wants and desires of consumers. It involves decision making in
the following areas (4Ps).
1. Product: Marketing managers plan and develop the right products or
services in terms of quality, packing, branding and design for the
market segment.
2. Price: Marketing managers determine a competitive fair price for
products, which should earn a fair profit.
3. Distribution (Place): Marketing managers make products or services
available to customers by distributing goods through channels of
distribution.
4. Promotion: Marketing managers inform customers about their
products or services by means of such marketing functions as personal
selling and advertising.
Pricing:
• A price for a product or service refers to the amount of money needed
to acquire the product ort service. In competitive business, marketing
managers strive to establish pricing polices to meet certain objectives.
▪ To enable the firm to earn a fair percentage of profit.
▪ To meet or stay a head of competition.
▪ To maintain or increase the firms share of the market.
▪ To stabilize its prices.

• Price is the exchange valve of product.

• Pricing is the most important decision making process, because this is

the factor which brings revenue and profits to the concern.
Factors influencing pricing:
Internal factors:
✓Corporate and marketing objectives of the firm.
✓Basic characteristics of the product.
✓Stage of product on the product life cycle.
✓Elasticity of demand of the product.
✓Aspects related t the marketing mix of the firm.
✓Image sought by the firm through pricing.
✓Costs of manufacturing and marketing.

External factors:
✓Buyer behavior regarding the particular product.
✓Market characteristics.
✓Extent of bargaining power of customers.
✓Competitors pricing policy.
✓Government controls and regulations.
✓Social considerations
Pricing objectives:
▪ Profit maximization in the short run.
▪ Profit maximization in long run.
▪ A minimum return.
▪ Target sales volume.
▪ Target market share.
▪ Finding new market or deeper penetration.
▪ Keeping competitor out/parity with competition.
▪ Target profit.
▪ Charging the price affordable by weaker section.
Pricing methods:
▪ Cost based pricing includes cost plus pricing, full cost pricing, rate of return pricing,
marginal pricing.
▪ Demand based pricing includes what the market can bear, skimming pricing,
penetration pricing.
▪ Competition based pricing includes premium pricing, discount pricing, pricing when
competition is stable.
▪ Product line based pricing means, pricing is done for the entire product line,
thereafter each product of the product line is priced considering influence of price of
one product on the other.
▪ Tender pricing is a competition oriented method of pricing, in which items are
purchased by the customer through competitive bidding.
▪ Rebate and discounts includes discounts to specific class of customers, discounts
related to total quantity purchased, festival rebates, off season rebates, rebate for
cash down purchase.
Pricing strategies: A number of pricing policies may be adopted to sell the
product. The following policies may be sued.
▪ Skim the cream pricing strategy sets the prices at the highest level at which goods can be sold. This
policy is used for the products introduced for the first time.
▪ Penetration pricing, low prices are fixed to capture large market immediately. It is useful when the
products are sensitive to price changes or when the product faces strong competition after it is
introduced.
▪ Odd pricing/ Psychological pricing. This is practice of pricing goods at the odd ending prices like 11.99
Rs, 40.95 Rs etc.
▪ One price system or variable price system. In one price system the same price is charged from every
customer, who buys the same product. Under variable the prices will vary for same quantities among
different customers.
▪ Price lining. Its commonly found in retailing consists of selecting a limited number of prices at which
products will be sold such as 9.95, 12.95.
▪ Leader pricing. It results in advertising one or few products at a price below cost to attract customers.
▪ Follow the market pricing. This policy determines prices being set that follow average or usual prices
of other firms in the same line of business.
Marketing management process:
✓ Organizing the market planning.
- adopt strategic market planning
- prepare a detailed marketing plans.
✓ Analyzing market opportunities.
- identify new market opportunities.
- know the marketing environment.
- study consumer behavior.
- study of organizational behavior.
✓ Selecting target market.
✓ Developing the marketing mix
- decisions regarding products.
- decisions regarding pricing.
- decisions regarding place.
- decisions regarding promotion
Functions of sales department:
▪ Market research.
▪ Advertising.
▪ Sales correspondence.
▪ sales,.
▪ Service.
▪ Packing.
▪ Warehouse.

Staff of sales department:

▪ Sales manager.
▪ Salesman.
▪ Sales inspector.
▪ Sales agent or dealers.
▪ Packers.
▪ Estimators.
Distribution channel:
Channel distribution is used to refer to various alternative ways for supplying the products
to the consumers from producers.
1. Direct distribution,
2. Indirect distribution.
✓ Manufacturer- Retailers- Consumer.
✓ Manufacturers- wholesalers- Retailers- Consumers.

Packing:
▪ Consumer packing.
▪ Industrial packing.
▪ Military packing.

Purpose of packing: Contain, Carry, Dispense, Communicate, Measure, Display, Preserve,

Motivate, Glamorize and Promote.

Packing materials: Paper, Plastic, Nylon, Metal foil, Glass wares, Wood containers etc.
Market Research:
▪ It is a commercial research for the suitability of a business and is continuous process.

▪ Market research is very essential in mass scale production because volume production
depends upon the continuity of demand.

▪ The object of market research is to inform the management as to what the future holds
good for its products and proposed products.

Classification:
▪ Product analysis.
▪ Market analysis.
▪ Distribution analysis.
▪ Competition analysis.
Market research techniques:
▪ Collection of data.
▪ Interviews.
▪ Market survey.
▪ Statistical methods.

Functions of market research:

▪ It helps in knowing that who and where the customer is and what he wants.
▪ It helps in knowing the sale trend, market potential and its shares in the market, which
is essential for production planning.
▪ It helps in knowing the defects in the products and reasons of resistance by consumers
and then to rectify them in future production.
▪ It studies the distribution channel and its effectiveness.
▪ It exploits new market and helps developing new [products.
▪ It safe guards the interest of the company against changes in the market in future.
▪ It keeps the business in touch with its market and thus helps the sales promotion
efforts.
Characteristics of good market research:
▪ Effective marketing research uses the principles of scientific method, careful
observation, prediction and testing.
▪ Marketing research develops innovative ways to solve the problem.
▪ Good marketing researchers should avoid over reliance on any one method.
▪ Good marketing researchers show concern for estimating the value of information
against its cost. This helps in deciding which research project should be conducted.
▪ Good marketing research benefits both the sponsoring company and its consumers.
Market promotion:
Market promotion is the promotional strategy of the concern should be to communicate
information about the concern or it products to the consumers to encourage them for
buying the product.

Elements of market promotion:

▪ Advertising.
▪ Personal selling.
▪ Publicity.
▪ Sales promotion.
▪ Packing.
Product life cycle
• The Product Life Cycle (PLC) defines the stages that a product moves through in
the marketplace as it enters, becomes established, and exits the marketplace.
• In other words, the product life cycle describes the stages that a product is likely to
experience.
• It is a useful tool for managers to help them analyze and develop strategies for their
products as they enter and exit each stage. The different satges are

✓1). The product development stage begins when the company finds and develops a new
product idea. During product development, sales are zero and the company’s investment costs
mount. This is a pre-stage.
✓2). The introduction stage is a period of slow sales growth as the product is being introduced
in the market. Profits are nonexistent in this stage because of heavy expenses of product
introduction.
✓3). The growth stage is a period of rapid market acceptance and increasing profits.
✓4). The maturity stage is a period of slowdown in sales growth because the product has
achieved acceptance by most potential buyers. Profits level off or decline because of increased
marketing outlays to defend the product against competition.
✓5). The decline stage is the period when sales fall off and profits drop.
Product Life Cycle
Major Stages in New-Product Development
Market promotion
• Promotional marketing refers to the process of sharing knowledge about a brand, product, or
service through multiple marketing channels to increase brand awareness. Promotional marketing
is one of the 4Ps of marketing, also called the marketing mix, which includes product, price, place,
and promotion.

• Four pillars of promotion: Advertising, Direct Selling, Sales Promotion and Public Relations. The
promotions mix refers to promotion strategies that are used to create demand for a product or
service.

• The 5 C's of marketing consist of five aspects that are important to analyze for a business. The 5
C's are company, customers, competitors, collaborators, and climate.

• Identify opportunities to sell more, serve better, save money, speak clearly, and sizzle with
excitement.
 Advertising
• The definition of advertising is an industry used to call the attention of the public to
something, typically a product or service. The definition of advertisement is the means of
communication in which a product, brand or service is promoted to a viewership in order
to attract interest, engagement, and sales.

• The process of advertising involves several stages, including planning the campaign,
creating the advertisement, executing the ad campaign and post-execution where
performance is evaluated based on predetermined key performance indicators (KPIs) like
increase in sales or return visits to the company's website.

• Advertising is a marketing activity that can help you to reach out to potential customers
and encourage them to buy your products or services. An effective advertising campaign
can help you to: increase customer reach. build customer awareness of your business and
brand
 Types of Advertising media
• Advertising media is 'the medium through which
an advertisement is delivered to a target
audience for the purpose of marketing,
promotion, and selling goods and services.
• The choice of the media depends on purpose of
advertisement, cost of advertisement and
circulation area and media.
• The types of media are
▪ Newspaper
▪ Television
▪ Radio
▪ Magazine
▪ Internet/email
▪ Transportation
▪ Outdoor
▪ Personal
▪ Sales promotion
▪ Speciality advertisements like during festivals, or
season sales
▪ Social media advertisement
Advertising message requirements
• The media of message should be suitable for presenting the concerns
message to specific market segment. The message should be tastefully
presented to the consumer in a clear and factual manner.
• An advertising copy should follow “AIDCA” which includes
▪ Attention: attention to read the advertise or listen
▪ Interest: have curiosity in the product
▪ Desire: increase the urge to acquire
▪ Conviction: decision to buy with good judgement
▪ Action: actually move the people to go out and buy