What is Marketing?

Marketing is the process of discovering and translating consumer needs and wants into product and service specifications, creating demand for these products and services and then in turn expanding this demand or user.

Marketing is an organisational function and set of processes for creating, communicating and delivering value to customers and for managing customer relationships in way that benefit the organisation and its stakeholder.

Definition of Marketing

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Scope of Marketing

The scope of marketing can be understood in terms of functions that an entrepreneur has to perform. These include the following:

Functions of exchange

which include buying and assembling and selling ?

Functions of physical supply

include transportation, storage and warehousing.

Functions of facilitation

Product Planning and Development, Marketing Research, Standardization, Grading, Packaging, Branding, Sales Promotion, Financing.

Marketing Management

Includes managing the need or the demand which in turn involves Managing Customer Relationship. Marketing Management thus helps the organization to achieve its goals by seeking to affect the level, timing and nature of demand. Simply put, marketing management is demand management.

Therefore, Marketing Management is defined as “art and science of choosing target markets and getting, keeping, and growing customers through creating, delivering, and communicating superior customer value”. A word of caution here is that ‘marketing’ should not be equated as ‘selling.

What is Marketed ?

Few entities marketed are explained by E.g.:

Goods

Tangible items that can be perceived by touch is known as goods.Physical goods constitute the bulk of most countries’ production and marketing effort. In developing nations, goods particularly food, commodities, clothing, and housing–are the mainstay of the economy. E.g. Refrigerators, Television Sets, Food Products, Machines etc.

Services

As economies advance, a growing proportion of their activities are focused on the production of services.Products that have intangible properties such as Working of Airlines, Hotels, Car Rental Firms, Barbers, Beauticians Etc. and Professionals such as, Accountants, Bankers, Lawyers, Engineers, Doctors, and Software Programmers etc. are termed as services.

Experience

Marketers create experiences by offering a mix of both goods and services. A product is promoted not only by communicating features but also by giving unique and interesting experiences to customers. For example water park, and theme parks provide experience marketing.

Another different real life experience is been enjoyed by customers at modern retail outlets. Now retailing is not an activity involved in just selling goods to the customers, it has now become an experience.

Shopping in a mall where the delightful experience comprises of not only shopping but also, spending time with family and friends, eating out, watching movie and enjoying the day.

People

Marketing can help people to market themselves. Due to a rise in testimonial advertising, celebrity marketing has become a business. Cricketers, film stars, authors, painters, musicians and sportsperson market themselves.

Some of the well–known personalities are Amitabh Bachchan, Sachin Tendulkar, Salmaan Khan etc. These people are not only successful in marketing themselves but also they lent their names to products like perfumes (Shilpa Shetty), retail stores by the name of true blue (Sachin Tendulkar), and clothes and accessories by Salman Khan with the name of ‘Being Human’.

Places

Cities, state and nation can be marketed to the consumers. Place marketers include real estate developers, commercial banks, businesses etc. The tourism ministry is also aggressively promoting tourist spots locally and globally. One cannot forget the incredible India campaign by Indian government to market India as tourist spot.

In India, Bangalore is known as the silicon valley of India. Kerala is known as God’s own country. Madhya Pradesh is known as “Heart of incredible India”. A campaign by Amitabh Bachchan for “Khushoo Gujaratki” (https:// www.youtube.com/watch?v=45Djyuzk9fI).

Organizations

Organizations actively work to build image in the minds of their customers. The PR department plays an active role to create a unique and favourable image in the eyes of customers. Marketers of the services need to build the corporate image, as exchange of services does not result in the ownership of anything.

The organization’s goodwill promotes trust and reliability. The organization’s image also helps the companies in the smooth introduction of new products.’Tata group’comprising of multiple brands, stands for trust and quality globally.

Philips advertises with the tag line, “Let’s Make Things Better” promise its customers, products that are technologically advance and hassle free.

Property

Properties are intangible rights of ownership of either real property (real estate) or financial property (stocks and bonds). Properties are bought and sold, and this occasions a marketing effort by real estate agents (for real estate) and investment companies and banks (for securities).

Properties, whether tangible like real estate or intangibles like stocks can be marketed to the customers. Properties are bought and sold and this exchange process seeks the role of marketing.

Events

Marketers promote different events from time to time to their customers. These events can be for individuals or organizations. Commonwealth games, Cricket World Cup Series, Musical Concert, Awards, and Fashion shows, etc are events.

Information

Information is basically produced and marketed and distributed by universities, schools, colleges, newspapers, magazines, books etc to the customers at a price. The customers here might be parents, students and communities.

Ideas

Every marketer offers some idea. Some offer it for money others do it for society in general. Marketers make profit from society and they shall also give back to the society. Social marketing comprises of creating awareness on ideas like Family Planning, AIDS awareness, discouraging–smoking, child labour, domestic violence, wearing of helmet while driving, blood and eye donation etc.

Marketer

A marketer is someone who seeks the response – attention, a purchase, a vote, a donation – from a prospect. Marketers work to understand the needs and wants of specific market and to select the market that they can serve best.In turn they develop products and services that create value and satisfaction for customers in these markets.The result is profitable long–term customer relationships.

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Fundamental Marketing Concepts

Needs

A human need is a state of felt deprivation of some basic satisfaction. People require food, clothing, shelter, safety, belonging, esteem and few other things for survival It includes needs that are physiological, safety, social, esteem, and self–actualization.

These needs are not created by their society or by marketers; they exist in the very texture of human biology and the human condition. We need to understand what type of need the prospect customer has ? Is it explicit, mentioned clearly or is it implicit, not expressed or unspoken.

There are five types of needs.

Types of Need	Definition	Examples
Stated Need	What the customer asks for ?	The customer wants and Inexpensive car
Real Need	What the stated needs actually means ?	The customer wants a car whose operating cost, not initial price, is low
Unstated Need	What the customer also expects but does not ask for ?	The customer expects good service from the dealer
Delight Need Secret Need	Needs that are not essential but would delight if met	The customer would like the dealer to include an on-board GPS(navigation) system
	Needs that the customer does not express often intangible in nature	The customer wants to be seen by friends as a savvy consumer.

Wants

Wants are desires for specific satisfiers of these deeper needs. A Gujarati needs food and want “Khichdi, Khaman & Khakhara”, need clothing’s and wants saree, salwar suit (for ladies) and kurtapiyama, shirt and pants (for gents) for office wear, chaniyacholi (for girls) and kediyu (for boys) for social occasions like garba, and needs leisure by travelling.

In another society, those needs are satisfied differently : Malays, in Malaysia and Singapore satisfy their hunger with local food, their clothing needs on special occasions with the bajukurong or kebaya, and their leisure needs are satisfied through shopping and movie watching. Human wants are continually shaped and reshaped by social forces and institutions such as religious groups, schools, families and business corporations.

Demands

Demands are wants for specific products that are backed by an ability and willingness to buy them. Individual wants become demand when supported by a purchasing power. There are many people who want a Macbook, but only a few are able and willing to buy one. Companies must therefore measure not only how many people want their product but, more important, how many would actually be willing and able to buy it.

There are eight types of Demands

Negative Demand	Consumers dislike the product and may even pay to avoid it
Nonexistent Demand	Consumers may be unaware of or uninterested in the product
Latent Demand	Consumers may share a strong need that cannot be satisfied by an existing product.
Declining Demand	Consumers begin to buy the product less frequently or not at all.
Irregular Demand	Consumers purchase vary on a seasonal, monthly, weekly, daily or even hourly basis
Full Demand	Consumers are adequately buying all products put into the marketplace
Overfull Demand	More consumers would like to buy the product than can be satisfied
Unwholesome Demand	Consumers may be attracted to products that have undesirable social consequences

Segmentation, Target Market, Positioning (STP)

Every individual has different choices for different things, so every customer cannot be served by the same marketing mix. But again it is not economically viable to have a tailored marketing mix for each customer. Segmentation can be understood as the process of clubbing together similar customers in a group.

The groups are smaller and more homogeneous, so that they can be served by a marketing mix especially designed for the group or segment. Segmentation can be viewed as the vehicle for entering a market. Market segments the buyer by demographic,geographic, psycho graphic and behavioral difference between them.

• Demographic segmentation means an audience bifurcation on the basis of age, race, gender, family size, income or education.
  
  
• Geographic segmentation means dividing by location, city, state, region or country.
  
• Psycho graphic segmentation is done on the basis of customer personality traits, attitudes, interests, values, and other lifestyle factors.
  
• Behavioral segmentation is done on the basis of customer’s purchase behavior, customer loyalty, occasions based and benefits needed (quality, performance, customer service, special features).

A firm carries out quite a few other tasks in addition to segmentation while choosing the target market. Segmentation is just the prelude, the means, or the tools; choosing the target market is the ultimate purpose and result. Then through developing market offerings, it strives to take position in the mind of the target customer, by delivering key benefits to him.

Offering and Brand

Companies provide ‘Offerings’, a set of benefits to satisfy the needs of customers. It can be in the form of product, services, experience etc. ‘Brand’ is the offering from the known source. E.g. : Apple Products, Le–Meridian Hotel etc.

Marketing Channels

There are three types of marketing channels. They are Communication, Distribution and Services Channels.

Communication Channels

Deliver marketing messages to potential customers. E.gs : television, radio, magazines, newspapers, hoardings, webpages, direct mailers and email.

Distribution Channels

Distribution channels are the delivery method for products. It helps display, sell or deliver the products or services to the user. These channels may be direct via the Internet, mail or mobile phone or telephone and the indirect channels via distributors, retailer, wholesaler or intermediaries.

Service Channels :

Service Channels up companies in carrying out business transactions.E.gs. Warehouses, Transportation Companies, Bank and Insurance Companies.

• Paid Media is one in which marketer have to pay fee and get their offerings marketed. The Platform includes TV, magazine and advertisement, paid search and sponsorship.
  
  
• Owned Media is media which is owned by the company like website of the company, Blog, face book page or a corporate brochure.
  
  
• Earned Media is types of media in which your offerings are communicated by customer, media by word of mouth, buzz or viral marketing.
  

Impression and Engagement

Impression refers to the number of times an advertisement, Face book post, tweet, or any other digital content is served up to the audience.

Engagement

Refers to active involvement of the customer with the communication of the company. Online measures of engagement are comments, likes, shares, clicks, re–tweets or any other measurable interaction with your digital content. If the content is good, then more audiences are likely to engage.

Value and Satisfaction

Value means consumer look on for the good deal from the company offerings. Satisfaction on the other hand, means that customer after purchase of the product, uses that product, and if the performance of that product matches the expectation than customer is satisfied. Otherwise, the customer is disappointed. If the performance exceeds the expectation than the customer is delighted.

Supply Chain

According to the Philip Kotler, Supply Chain is a channel stretching from raw materials to components to finished product carried to final buyers.

Competition

means the rivalry between companies selling similar products and services with the goal of achieving revenue, profit, and growth in market share.

Market Environment

There are internal and external factors that surround the business and influence its marketing operations. Internal factors include employees, customers, shareholders, retailer, distributors and the external factors includes political, legal, social, technological and economical conditions.

A company’s marketing environment consists of the actors and forces outside of marketing that affect marketing management ability to build and maintain successful relationships with target customers”. – Philip Kotler

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Philosophy of Marketing

There are five concepts under with organization conduct their marketing activities :

Exchange Concept

This concept holds the central idea in marketing is exchange–exchange of product between the seller and the buyer. Some firms operate with the idea that marketing is simply a matter of giving a product to someone in exchange of money. Marketing is broader than exchange.

Marketing includes concern for customer, generation of value satisfaction, creative selling and integrated action for serving the customer. Exchange covers the physical aspects and the price mechanism involved in marketing. Exchange concepts is the least evolved view on marketing.

Production Concept

This is the oldest concepts guiding sellers. In this concept, firm believes that business can be managed by maximizing production, so that unit cost of the product will be low.

Firm works on the MANTRA “Maximising output, with lower unit cost and selling the product to the customer with a low price”.

Here production dominates and the marketing is given less importance. It is assumed that the low price of the product will attract the customer. In practice, however, it does not happen because customer are motivated by various other factors other than price.

Product Concept

In this concept consumer will prefer the product that offers quality, performance, new product, ideally designed and engineered products and innovative features.

Managers in these product oriented organizations achieve success by focusing their energy on making superior products, emphasis on quality assurance, and product attributes.

They spend most of their time and money on research and development and bring out many products. They produce the quality products but fail to the determine consumer needs and satisfaction. Hence this cannot achieve great marketing success.

The Selling Concept

In this concept firms believe that main marketing concern is to aggressively push the product and persuade the customer to buy the offered product. However, the consumer will only buy the product if the organization undertakes a large– scale selling, heavy advertising, extensive sales promotion and substantial price discounts as the tools of sales concepts. The concept is unlikely to succeed as it assumes that selling is synonymous with marketing.

Marketing Concept

There are firms that believe that the customer is central to their business. This concept holds that achieving the organisational goals depends on determining the needs and wants of target markets and delivering the desired satisfactions more effectively and efficiently than the competitors do.

	Starting point	Focus	Means	Ends
Selling Concept	Factory	Products	Selling and Promoting	Profits through sales volume
Marketing Concept	Target market	Customer needs	Coordinated marketing	rofits through customer satisfaction.

(Adopted from Marketing Management : An Assam Perspective : 8th Edition)

Marketing Mix

James Culliton

a noted marketing expert, who coined the expression, “marketing mix.” According to Philip Kotler Marketing Mix is the set of controllable, tactical, marketing tools that the firm blends to produce the response it wants in the target market.

The 4Ps classified by McCarthy make up a typical marketing mix – Price, Product, Promotion and Place. However, nowadays, the marketing mix increasingly includes several other Ps like Packaging, Positioning, People and even Politics as vital mix elements.

Below is a given complete picture of the different tools under marketing mix variables.

(Source : Philip Kotler, Principles of Marketing, Pearson/PHI)

• Product : Means goods and the services which are offered by the company to the target market, to satisfy needs and wants.
  
  
• Price : Means the money which customer has to pay to buy a product or service.
  
  
• Promotion : Refers to activities of personal selling, advertisement, and communicating product benefits and attributes to target consumers to persuade them to purchase.
  
  
• Place : Stands for Physical distribution activities through which the product moves from the factory to the customer. Channels include distribution, logistics, warehousing, transport, etc.
  

In order to achieve the corporate objectives, the marketing programmes have to blend the four Ps into the ideal integrated action plan.

The above mentioned 4Ps relate to the seller perspective of the market. There are four Cs from the consumers view–point also.

Fours Cs

• Customer solution
  
• Customer Cost
  
• Convenience
  
• Communication

be effective, marketing people have to consider the four Cs first and then build the four Ps based on the requirements.

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Emerging Trends in Marketing

CAUSE RELATED MARKETING

Formulating and implementing marketing activities that are characterized by an offer from the firm to contribute a specified amount to a designated cause Many believe companies should prioritize support of issues that affect the quality of life on a local, national and global level.

Employees want to get involved in their company’s cause–related efforts mainly through matching grants.

E.g. – When someone buys a pair of TOMS shoes in the US, the company donates a pair of shoes to a child in a poor country like Haiti.

Benefits of Cause Marketing

• Increasing exposure and awareness of company for–profit or non–profit organisations
  
  
• enlargement in brand loyalty
  
• boost up in employee morale and loyalty
  
• growth in sales
  
• company reviews as well as positive press coverage
  
• respected and accepted business practice
  
• materials a corporate PR officer
  
• develops goodwill
  
• increasing reputation
  
• differentiating from the competition
  
• increases in donations through greater exposure
  
• greater public awareness of the cause, its supporters, and the
  
• activities undertaken to advance the cause.

Concerns

• long–term sustainability of the cause may be threatened if funding sources dry up and the company pulls out of the partnership.
  
• here is an ethical and moral issue about a shift from the intrinsic motivation of a company towards social responsibility to using social causes as an instrument to increase profitability and market share.
  
• may risk alienating certain consumers that may be hostile to certain social causes.

EXPERIENTIAL MARKETING

Experiential marketing is a strategy that engages consumers using branded experiences. The idea is to create a memorable impact on the consumer. It is a also called as “live marketing” or “event marketing experience.”

These experiences could include an event, a part of an event, or a pop–up activation not tied to any event. It is marketing strategy that engages the consumer and creates real– life experience that will be remembered. This type of marketing focuses on getting the consumer to experience the brand. The experience that will inspire them to share with their friends both online and off.

E.g. – In the opening of France’s IKEA store, the Swedish furniture company installed a vertical rock–climbing wall covered with IKEA furniture.

Importance

he goal of experiential marketing is to create lasting impressions on consumers that they want to share with others and that, ultimately, lead to brand loyalty. The organisation is not advertising a product. It is just letting consumers see and feel what their lives would be like with it.

Direct Reach

This is when your campaign aims to interact directly with audience. E.g. – Using augmented reality applications to show customers what their chosen piece of furniture would look like when placed in their living room.

This is when your campaign aims to interact directly with audience. E.g. – Using augmented reality applications to show customers what their chosen piece of furniture would look like when placed in their living room.

Indirect Reach

This is when your target audience is primed to find out about your campaign through other media platforms as opposed to directly interacting with it. These are bold campaigns that rely on word of mouth, creating a viral marketing campaign around an event that everyone would talk about for ages to come.

E.g. – Red Bull sponsored Austrian skydiver to free-fall from an altitude of 39 kilometers and then parachuted back to Earth. This ambitious project was named Red Bull Stratos. It was something the world had never seen before.

Red Bull branded attempt was live streamed in 50 countries, across 80 TV stations, racked up a 8 million simultaneous viewers on YouTube, and watched live by a total of 52 million viewers.

GREEN MARKETING

Negative impact of human activities over environment is a matter of great concern today. There are many alternate names given to Green Marketing : Sustainable marketing, Environmental marketing, Green advertising, Eco–marketing, and Organic marketing.

Definition

Marketing products and services based on environmental factors or awareness. Companies involved in green marketing make decisions relating to the entire process of the company’s products, such as methods of processing, packaging and distribution”.

Green marketing is essentially a way to brand your marketing message in order to capture more of the market by appealing to people’s desire to choose products and services that are better for the environment.

There are many environmental issues that have impacted by the production of goods and services. Green marketing can appeal to a wide variety of these issues : an item that can save water, reduce greenhouse gas emissions, cut toxic pollution, clean indoor air, and/or be easily recyclable.

We can express green products which are : Originally grown, Recyclable, reusable and biodegradable, with natural ingredients, recycled with non–toxic chemical, under approved chemical usage, with eco–friendly packaging i.e. reusable, refillable containers Also, the products that do not harm or pollute the environment.

GUERRILLA MARKETING (GM)

Guerrilla Marketing is an advertising strategy that focuses on low– cost unconventional marketing tactics that yield maximum results. The term GM was inspired by guerrilla warfare is a strategy used by armed warriors against larger armies, tactics includes ambushes, sabotage, raids and elements of surprise. Guerrilla marketing uses the same sort of tactics in the marketing industry.

This alternative advertising style relies heavily on unconventional marketing strategy, high energy and imagination. GM is about taking the consumer by surprise, make an indelible impression and create copious amounts of social buzz. It is said to make a far more valuable impression with consumers in comparison to more traditional forms of advertising and marketing.

This is because most GM campaigns aim to strike the consumer at more personal and are memorable. GM originally was a concept aimed towards small businesses with a small budget, but this didn’t stop big businesses from adopting the same ideology.

Larger companies have been using unconventional marketing to complement their advertising campaigns. It can be used for promotion on the streets, shopping centers, parks, beaches or other public places getting the attention of the public.

Advantages

Cheap to execute. Whether using a simple stencil or a giant sticker, GM tends to be much cheaper than classic advertising.

Allows for creative thinking. With GM, imagination is more important than budget

Grows with word–of–mouth. It relies heavily on word–of–mouth marketing, considered by many one of the most powerful weapons in a marketer’s arsenal. There’s nothing better than getting people to talk about your campaign on their own accord.

Disadvantages

Mysterious messages can be misunderstood. While there is a sense of mystery, it can often go wrong for the lack of clarity. Authority intervention. Some forms of guerrilla marketing, such as non–permission from authorities.

Unpredicted obstacles. Many guerrilla marketing tactics are susceptible to bad weather that could easily threaten to undermine an entire campaign.

RURAL MARKETING

Rural marketing is now a two–way marketing process. There is inflow of products into rural markets for production or consumption and there is also outflow of products to urban areas. The rural market has been growing steadily over the past few years and is now even bigger than the urban market.

About 70 per cent (more than 800 million) of India’s population lives in villages. ‘Go rural’ is the marketer’s new slogan. Indian marketers as well as multinationals, such as Colgate–Palmolive, Godrej and Hindustan Lever have focused on rural markets since long.

Thus, looking at the opportunities, which rural markets offer, the future is very promising. Indian villages had the concept of village markets popularly known as the village hats. The hats are basically a weekly gathering of the local buyers and sellers. The barter system was quite prevalent, which still continues in a number of places even today.

Definitions

Identifying the needs of customers and potential customers, providing products/services that satisfy their needs, and developing efficient processes or systems to deliver product/service to the market when, where, and how consumers want it.

Features of Rural Marketing

The main reason why the companies are focusing on rural market and developing effective strategies is to tap the market potential, that can be identified as :

Large and scattered population

With 70 per cent of India’s population living in rural areas (6 lakh villages) it holds a big promise for the marketers.

Higher purchasing capacity

Purchasing power of the rural people is on rise. Marketers have realized the potential of rural markets, and thus are expanding their operations in rural India. In recent years, rural markets have grown as there is overall growth of the economy. It has resulted into substantial increase in purchasing power of rural communities.

Market growth

The rural market is growing steadily over the years. Demand for traditional products such as bicycles, mopeds and agricultural inputs; branded products such as toothpaste, tea, soaps and other FMCGs; and consumer durable s such as refrigerators, TV and washing machines has also grown over the years.

Development of infrastructure

There is development of infrastructure facilities such as construction of roads and transportation, communication network, rural electrification and public service projects in rural India, which has increased the scope of rural marketing.

Low standard of living

The standard of living of rural areas is low and rural consumers have diverse socio–economic backwardness, because of low literacy, low per capita income, and low savings.

Traditional outlook

The rural consumer values old customs and traditions. The changes are accepted slowly with changes in demand pattern.

Marketing mix

The urban products cannot be dumped on rural population; separate sets of products are designed for rural consumers to suit the rural demands. The marketing mix elements are to be adjusted according to the requirements of the rural consumers.

VIRAL MARKETING

Definition

Viral marketing refers to a technique in marketing a product or a service where users help in spreading the advertiser’s message to other websites or the users create a scenario leading to multi– fold growth. Viral in literal sense means anything which spreads fast (across users).

This term is symbolically used in context with the web or mobile domain. It is a marketing strategy which inspires users to spread or share the message to other users which can lead to multi–fold growth.

E.g. – Gmail, when launched as a free web–based email service, was by invitation only at first which helped create curiosity among the users. The users who got a Gmail account could then send an invite to other users to create an account, and the chain continued. There are various elements for effective marketing strategy which can make it viral.

Firstly, product or services should be ‘free’ for all, and should have easy accessibility.

Next important element is the transferability part, which simple means that the message can be easily transferred or shared via email, WhatsApp, networking websites, etc. The message should be simple to understand and at the same time it should be short.

Another element is that the message should be interesting and intelligently placed. Users should be able to identify with the message. Viral Marketing is that which is able to generate interest and the potential sale of a brand or product through messages that spread like a virus, that is from person to person.

The idea is that for the users themselves that delide to share the content. Due to their speed and ease to share, social networks are the natural habitat of this kind of marketing.

E.g. – in recent times is the creation of emotional, surprising, funny or unique videos on YouTube, are shared on Facebook, Twitter and other channels. However, virality can be a double–edged sword. In this type of campaign, a large part of the control falls into the hands of the users, and there is a risk that the message can be misinterpreted.

On the other hand, a successful viral campaign can work miracles for a brand. Viral marketing campaign is very simple to carry out : create a video or another type of content which is attractive to your target, put it on the internet and promote it. From there on, all you can do is wait for users to start sharing like crazy.

Low cost. What characterizes viral campaigns is that the users do a significant part of the work for the brand, which drastically cuts down the costs of dispersion. Potential of great reach. A viral video on the Internet has the ability to reach a huge international audience without having to invest a huge sum of money or make any extra effort. It is not invasive.

As the user is making the decision to participate and share content, so it lessens the possibility of the brand coming across as invasive. It helps build up your brand. If we really hit the bull’s–eye in terms of creativity, it is creating content so incredible that users themselves decide to share it and, hence create a personal connection with the brand.

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