Market Classification

Advance marketing mgt

• Total Market: 100
• Potential Market: 80
• Available Market: 60
• Eligible Market: 40
• Target
T t Market:
M k t 30
• Penetrated Market: Actual customers

Types of Market Types of Market

• B2B: Industrial • Rural Market
– Companies, Institutions, Channel, NGO, Cooperative, Middlemen etc. (non
personal usage) – Reaching rural customers for improving revenue
• B2C: Urban • Referral market
– Households, families, individual (personal usage) – Recommenders such as doctors, architects, consultants,
• C2B: Compiler support teachers, opinion leaders etc.
– Platforms supporting consumers to get deals such as
• Policy bazar • Recruitment market
• Book my show – Naukri, Shine etc. consultants, educational institutions providing
p g
• Trivago etc opportunities to get jobs
• C2C: Direct deals
– Platforms providing opportunities to consumers to reach other consumers
• Supplier market
• OLX – Raw material providers to OEMs as OEMs
• Quicker – Private label mfrs
• B2G: Government
– Reaching government institutions, Kind of B2B only
• Replacement market
• B2E: Internal market – Middlemen market for spare parts
– Reaching employees of the organization • International market
– Salary Account as an example – Cross national boundaries for expansion of markets

Market size enhancement is the key Business Markets

• The idea is to expand market size….
–Higher the width of market better the sales revenue
• IKEA, Apple, Samsung, Amul, M&M, Reebok, Nike etc.
–better the security,
–better the reach,
–better the distribution,
–better the consumption and soon
• The whole idea of improving the sales revenue
is to expand market size

1
 Purchasing activities or Buy Phases Problem or Need recognition
• It consist of various stages of buying decision making • The problem may be recognized in the following
process indicating the logical sequence of activities such
as circumstances within the buying firm or may be
– Problem or need recognition recognized by a smart marketer:
– Determine the characteristics and quantity of needed product –Availability of material is not there
– Development of specifications of needed product
–Supplied product quality is not satisfactory
– Search for potential suppliers
– Obtaining and analyzing supplier proposals –Supplied machine breaks down too often.
– Evaluation of proposals and selection of supplier • If the industrial marketer identifies a problem
– Selection of an order routine
– Performance feedback and post purchase evaluation
–within the buying organization and suggests how the
problem could be solved
• The understanding of buy-phases and type of buying
situation is very useful for an industrial marketer • then there are better chance of it being selected as a supplier
– as it helps in developing an appropriate selling strategy.

Example – Case of a material handling Determination of characteristics and

equipment manufacturing company quantity of product needed
• The sales executive visited a car manufacturing • It depends on the type of the product such as
company in India and –In case of technical products:
–while taking a walk on the shop floor he noticed a long • The technical department such as R&D, production, quality
queue of trucks control
• waiting to unload the incoming components and parts. – will
ill suggestt the
th needed
d d product
d t andd its
it quality
lit
–The operation of unloading was taking a long time as –In case of non technical products:
it was done in a semi-manual way.
• The purchase department will suggest the needed product and
–He studied the operation and then suggested that he quantity on the basis of their experience.
could supply an automatic equipment i.e.
• Hydroelectric lift table which could reduce the time of
unloading substantially.
• Another example is Red Double tape.

Development of specification of needed Search for Potential Suppliers

product
• This required the knowledge of
• During this stage, the purchase department – available options and their acceptability.
takes the help of • This knowledge can be obtained by various sources
–their technical personnel and if required outside such as
– Trade journals
sources such as suppliers and consultants
– Trade portals
• to develop product specification or dimensions at the early
– Sales calls
stage
– Catalogues
– as any mm change in design or specification would be very costly
for the organization. – Word of mouth
– Internet
• E.g. – Trade shows and
–If diameter of the pipe is increase by even 1mm – Industrial directories etc.
• then the specific product will not fit in the pipe.

2
 Search for Potential Suppliers Obtaining and analyzing supplier proposals
• This required the knowledge of • A supplier proposal can be submitted in the following
forms
–available potions and their acceptability. – Formal offer
– Quotation or Estimate
• The acceptability of the supplier depends on – A formal bid Microsoft Excel
Worksheet
–Type of buying organization – Bill of quantities
–Buying
Buying situation • It should include
– The product specifications
–Decision making members – Price
–Supplier’s reliability in delivery and service – Delivery Period
– Payment terms
–Quality of product and service – Taxes and duties applicable Microsoft Excel
Worksheet
– Transportation cost
– Cost of transit insurance and
– Any other relevant cost if required

S.No. Name of the Company Contact Person Contact Detail's

Evaluation of Proposals and Selection of 1 Mercedez Benz-Pune Capt. Shanker Srinivasan (+91) 20 27505000
Supplier Head - Corporate Communications (+91) 20 27505306

2 Godrej - Mumbai Mr.Mehernosh B.Pithawalla ( +91) 22 5596 4755

• Evaluation is done on a set of each attribute Manager - Marketing (+91) 22 55965656/5959
–by giving a weight age to each attribute on a 100 point
rating scale. (Refer table 3.1 – A supplier evaluation Associated Capsules
3 Group. Mr. Shirish Vaidya (+91) 22 28682650
system) Microsoft Excel Marketing Manager
Worksheet

• The supplier who get the highest score from a

4 BASF-Mumbai Ms. Sunita Sule (+91) 22 5661 8000
total rating of 57 Manager - Corporate
Communications (+91) 22 2495 0512
–receive the purchase order from the buying
organization. 5 Kirti Ornaments -Mumbai Mr. Sagar Joshi (+91) 22 5636 7773

• Also check for references as per next slide Director- Marketing (+91) 22 5636 7769

6 Fine Organics - Mumbai Ms. Ujjwala More (+91) 22 2509 3400-11

Manager Marketing

Selection of an order Routine - PO Sample PO

• Here, the mechanics of exchange of goods and
services is worked out. It includes activities such
as
–Issuing PO to selected supplier
–Qty to be purchased from each supplier
–Frequency of order placement by buyers (4 times in a
year)
–Delivery schedule for supplier (Deadlines)
–Follow up on actual delivery to verify schedule
–Payment terms for buyers

3
 Performance feedback and post purchase Clip
evaluation
• B2B Deal – Raju ban gaya gentlemen
• The user department gives a feedback on • Maruti Kitna deti hai ad
–whether the purchased item solved the problem or
not.
• A formal or informal review
–regarding the performance of each supplier takes
place
• If the user is satisfied
–then repeat purchase takes place else order is given
to another supplier

Type of purchases or buying situations or Type of purchases or buying situations or

Buy classes Buy classes
• New Purchase or New Task: • Modified Re-buy or change in supplier :
–This is a first time purchase –This situation comes if the buyer is not satisfied
• due to internal or external factors. • with the suppliers’ performance or the need arises for cost
–E.g. When a firm diversify into new products or reduction or quality improvement.
services
–Therefore
Th f buyer
b search
h ffor iinformation
f ti
• it requires purchase of new machine, materials or parts.
• about alternative source of supply
–Since, here buyer has limited knowledge and lack of
experience that is why –E.g.
• he obtain a variety of information about product and supplier, • Swift VS P&I onsite case
prices and soon.
–This process takes more time and more people are
involved in decision making.

Types of Buying Situations (Buy classes)

Type of purchases or buying situations or
Buy classes
1. New Task / New purchase
• Repeat Purchase or Straight Re-buy: – Problem/ need is different from past experience.
– Problem recognition maybe triggered by internal or external factors.
–This situation comes when buyer requires certain – More information, risk, decision time, people involved
product or services continuously and
• if he is happy with the existing supplier 2. Modified Rebuy / Change in Supplier
– then
h PO would
ld go to them
h as a repeat order.
d – Due to existing suppliers’ poor performance,
performance or change in
specifications or awareness of better alternatives for Quality, cost etc.
–E.g. – Uncertainty about most suitable supplier
• Swift VS P&I Case
3. Straight Rebuy / Repeat Purchase
– Due to existing suppliers’ good performance
– Routine, low risk decision. Less information needed

24

4
 Buy Grid Framework Buy Grid Framework

AnalyzesPurchasedecisionprocessunderdifferentbuyingsituations. Buy classes (situations)

Buy phases New Modified Straight
Buy classes (situations) Task Rebuy Rebuy
Buy phases New Modified Straight 1. Problem / need recognition Yes May be No
Task Rebuy Rebuy 2. Characteristics, Quantity of needed Yes May be No
1. Problem / need recognition product
2. Characteristics, Quantity of needed product 3 Specification of needed product
3. Yes May be No

3. Specification of needed product 4. Potential suppliers’ search Yes Yes No

4. Potential suppliers’ search 5. Obtain and analyze supplier proposals Yes Yes May be

5. Obtain and analyze supplier proposals 6. Evaluate proposals and select suppliers Yes Yes No

6. Evaluate proposals and select suppliers 7. Select an order routine Yes Yes May be

7. Select an order routine 8. Performance feedback and evaluation Yes Yes Yes

8. Performance feedback and evaluation

Buy--Grid Framework by Robinson

Buy News 492. Print ad
• It combines 3 types of buying situations (Buy-classes)
with 8 stages of buying decision process (Buy-Phases).
• The result from this framework is as follows:
– All 8 stages are applicable in case of a new task buying situation,
• however in case of modified or straight re-buy only some of the
buy-phases
yp are applicable
pp
– The most difficult situation occurs in case of a new task buying
situation
• to determine the characteristics and specification of a product which
require more number of decision makers.
– Modified re-buy situations are not very difficult to handle
– Straight re-buy situations are handled in a routine manner.

Buying Centre
Buying centre or Decision making unit or
buying group Important for Sales team to identifying Key Buying Influencers
ƒ For Highly Technical products, Engineers & R&D personnel are key
• It is defined as a body of all the individuals or influencers.
groups ƒ For Component parts eg spark plug, battery etc in an auto co, Quality
–who participate in the buying decisions process and Control & Production people.
–who have interdependent objectives and share
ƒ For straight
g Rebuy,
y, where repeat
p p
purchase is made,, Purchase
common risk.
i k Executives are most important.

5
Members or participants in decision making Members or participants in decision making
unit unit
• Top management persons • Technical Persons
–They are Director, president, vice president, general –They are Engineers, Production Manager, Quality
manager etc. control manager, Maintenance manager, R&D
–Involvement: They are involved in the following Manager etc.
• Product diversification –Involvement:
I l t They
Th are involved
i l d iin th
the ffollowing
ll i
• Giving Approvals • Product specification
• Making guidelines and • Negotiations with suppliers
• Purchase of high value capital equipment • Performance feedback on technical aspects etc.

Members or participants in decision making Members or participants in decision making

unit unit
• Purchase Department • Account and Finance Persons
–They are Purchase managers or assistants or gate –They are involved while finalizing commercial terms
keepers such as
–Involvement: • Mode of payment
• They are involved in coordination within different • Issuance off bank
b k guarantees
departments as well as with suppliers to purchase the items. • Issuing payments and soon

Members or participants in decision making Buying Centre Roles

unit
• Initiators:
• Marketing function – They are problem or need Recognizer
• which could be resolved by purchase of a product or service.
–They are involved in giving suggestions related to
– They could be any individual in the buying firm.
customer satisfaction while purchase in transit
• such as packaging related decision to avoid damages, • Buyers: They are purchase managers or assistants and
their responsibilities includes
• while
hil finalizing
fi li i commercial i l terms suchh as
– Obtaining quotation
– Mode of payment
– Supplier evaluation and selection
– Issuance of bank guarantees
– Negotiation
– Issuing payments and soon
– Processing PO
– Expediting deliveries
– Implementing purchase policies of the organization

6
 Buying Centre Roles Buying Centre Roles
• Influencers: • Gate-Keepers
– Those who influences buying decisions such as
• Technical people, experts and consultants
–They are assistants or Junior persons attached to
– who have the knowledge about the product purchase manager who could control the following:
• Deciders: • Control the flow of information to the managers of the buying
– Who take the actual buying decisions which may vary depending centre
upon the product type
type. • Control
C t l the
th sales
l people’s
l ’ meeting
ti withith the
th members
b off the
th
• E.g. buying centre.
– For Routine purchase:
• Purchase manager is the decider
– For high value products:
• Top management people
– For technical products:
• Technical people

Marketing Strategies-
Strategies-Various Buying Situations & Phases
Marketing strategies for managing Industrial
buying Nature Buy classes
Buy phases New Task Modified Straight Rebuy
Rebuy
• After getting the PO, (Sample) 1. Problem / need Anticipate Problem; Use In Supplier-Maintain In Supplier-Maintain
–the user satisfaction level or complaints recognition advtg & creative sales
persons to convince of
quality/ service stds; Out
Suppliers-Watch for
close relation with users
& buyers; Out Supplier-
• must be monitored by the Industrial marketer problem solving capability developing trend Convince firm to
reexamine options
–so that immediate corrective action can be taken 2. Solution Provide Tech assistance & In Supplier & Out Same as Phase 1
Determination
D t i ti i f
info Supplier-Stress
S li St prob b
• before a major damage is done which results in good buyer- solving capability
seller relationship. 3. Determining Provide detailed product/ Same as Phase 2 Same as Phase 1
Needed Item service info to decision
• The marketing strategy depends on the makers
4. Potential suppliers’ In Supplier-Maintain In Supplier-Watch for Same as Phase 1
following search dependability; Out problem; Out Supplier-
Supplier- demonstrate demonstrate ability to
–Type of products ability to perform task perform task

–Buy-phases 5. Searching for & Understand details of Understand details of Make timely proposals
Qualifying supplier customer problem/ needs; customer problem/ needs;
–Buy-classes make timely proposals make timely proposals
40

Contemporary Purchasing Activities IndustrialMarketingIntelligence

• Just-in-time (JIT) Delivery

• Out sourcing

• Global sourcing

• Single sourcing

• Value analysis / Value engineering

• Supplier evaluation system/Multi attribute model

• Buying committee/Buying centre

Activities Tools
41

7
 Concept of Buying Behavior Buying Roles
• Buying Behavior: • Initiator: who suggests idea of buying. E.g.
Parents
–Study of what customer do and why.
• Influencer: whose view or advice influences
• Objective to know this behavior for a marketer decision. E.g. Friends, teacher for a book
–To know what is important to customer • Decider: when, what, how, where to buy. E.g.
–What
What influences consumer decision making Father
–Design consumer interest based marketing program • Buyer: who makes actual purchase. E.g. Mother
• User : who consumes product or service. E.g.
Son/Daughter

Consumer Buying Steps Between Evaluation of Alternatives

Process and a Purchase Decision
Problem
recognition
Evaluation
Information of
alternatives
search

Evaluation of Attitude
of others
alternatives
Purchase Purchase
Purchase intention decision
decision
Unanticipated
Post purchase situational
behaviour factors

Decision Making Sets

Stage Brief description

The consumer perceives a

need and becomes
Problem motivated to solve a
recognition problem. Motivation
Total
Set Aware- The consumer searches for
Consid- information required to
ness Information make a purchase
eration Choice search decision Perception
Set
Set Set Decision
The consumer compares
Information various brands and
evaluation products Attitude formation

The consumer decides

Decision which brand to purchase Integration

Post-purchase The consumer evaluates

evaluation their purchase decision Learning

8
 Phases in Purchase Decision Process B2B
How Customers Use or
Problem / Need recognition
Dispose of Products
Decide product characteristics & quantity
To be
Rent it Give it (re)sold
Get rid of it away Develop Product specifications
temporarily Loan it
To be Search for potential suppliers
used
Trade it
Get rid of it Obtain & analyse supplier proposals
Product permanently Direct to
Use for consumer
original Sell it Evaluate and select suppliers
purpose
Keep it Convert Through Selection of an Order Routine
to new Throw it middleman
purpose away Performance feedback & Evaluation

Store it To
intermediary

Phases in Purchase Decision Process - B2B vs B2C

B2B Mix
B2B B2C
Problem / Need recognition Problem / Need recognition
• 6Ps, 6Cs, 6As
Decide product characteristics & quantity –Product, Price, Place, Promotion, Process and Proof
–CS, Cost, Conv, Comm, Coordination and
Develop Product specifications InformationSearch
Confirmation
Search for p
potential suppliers
pp
–Acceptable, Affordable, Accessible, Awareness,
Actions and Assurance
Obtain & analyse supplier proposals • 5B
Evaluate and select suppliers Evaluation of Alternatives –B2B Markets, Buyphases or process (B2B), Buying
situations or classes, Buying center participants and
Selection of an Order Routine Purchase Decision roles, Buying decision making process (B2C)
• 7M
Performance feedback & Evaluation Post Purchase Behaviour

B2B Mix
• 7M
– Marketing basics: 5Cs:
• CS, CV, CRM, Complaints and Customization
– Markets and goods: Types:
• Urban, Rural, Industrial, Government, International, etc. and
• Goods such as Machines and equipments, Material and parts, MRO:
Maintenance, Repairs and operating supplies, Marketing of Services
•Chapter: 6
– MICRO and d MACRO E Environment
i t
– Marketing Analytics:
• MKIS + Marketing Intelligence + Marketing Research
– Marketing Plan or Strategy:
• STPD + Marketing Mix
– Market Trends:
• Green marketing, Sustainable marketing, Social marketing, Direct
marketing, Digital marketing, Mobile marketing etc.
– Measuring market performance

9
 Global Marketing Changing Contemporary International Marketing/Business Env.

A process of focusing resources (men, money, materials and management 1. Globalization

skills) and objectives of the organization on global marketing/business
opportunities and threats. 2. Competition in the world market
3. Globalize work groups
Company Resources + Objectives 4. Global Delivery System

Global business
opportunities and threats

Why do companies seek international business/marketing Stages of Internalization/Entry Strategies in International Marketing
or Types/Streams of International Business: Global Marketing
Decisions
1. Saturation in the domestic market
1. Exporting
2. Trade Deficit
2. Licensing
3. New emerging market
3. Franchising
4. Economies of scale
4. Contract Manufacturing
5. Safety net during business down turns
5. Manufacturing in foreign country
6 Low
6. L costt labor
l b
6. Wholly owned subsidiary
7. Tax Incentives
7. Joint Venturing
8. Access to world wide technology resources and diverse economic groups
8. Mergers and acquisitions
9. Strategic Alliance
10. Foreign direct investment (FDI)

Earlier methods – Exporting, licensing and contract manufacturing

Latest – Joint venture, mergers and acquisitions, strategic alliances

Examples of companies doing international marketing

Global Vs. Domestic Marketing
1. Macdonalds • Similarities
2. Dell – Need
3. Fedex – Want
4. Blue dart – Demand
5. Sony
– Product levels
– Service levels
6 Motorola
6. M t l
– Exchange
7. HP
– Transaction
8. Nokia – CS
9. LG – CV
10. Hitachi – CRM
– Quality and improvements

10
 Global Vs. Domestic Marketing The Role of Orientations

• Differences
– Political Environment
– Economical Environment 1. Ethnocentric – The company believes that home country is superior and products
• Monetary system which succeed locally are superior and will succeed in the other countries also, without
adaptation. Differences in consumer needs and wants in global markets are ignored.
• Demand and supply pattern Marketing management is centralized. In today’s world market, this is a totally wrong
policy.
– Socio Cultural Environment 2. Polycentric – The company assumes or believes that each country in which it plans to
operate is unique. For each country they develop unique business and marketing
– Technological Environment strategies suitable for the local conditions and consumer needs. These are described as
multinational companies (MNC). Marketing management is decentralised.
– Legal System 3. Regiocentric – The company management views regions as unique and develops an
– Marketing Mix System integrated regional marketing management strategy. A company that focuses its
attention on Asian region or only in the Middle-East region is regiocentric.
– Documentation 4. Geocentric – These companies see the entire world as a potential market and strive to
develop integrated global market strategies.
– Rules and Regulations
– High risk due to larger volumes, high value and time element

The Forces Affecting Global Marketing Global Marketing Program

Driving Forces Restraining Forces 1. Choosing the entry strategy

2. Selecting target markets
Technology Myopic Management
3. Product decisions
Trade agreements Ethnocentric Management
4. Channel decisions
Economic Growth Trade barriers
5. Pricing strategy
Transport
6. Global promotion
Communication
7. Procedural formalities
8. Organisational requirements
9. Ethical considerations

International Business Environment

Global Marketing
Environment • International Business is effected continuously
by
–Internal or home or domestic &
–External or host or international Environment.
• An international
te at o a bus
businessman
ess a ca
can be
successful
–only if he understands and accepts the
• dynamics of international business environments.

11
 Internal Environment Internal Environment (4Ps + Depart.)
• Environment within the company needs to be • The internal environment consists of:
analyzed – Organizational flexibility and adaptability
–before looking for international business. – Leadership and management attributes
– Support from stakeholders
• A SWOT analysis is required to achieve
– Past experiences etc.
success while planning.
p g – Product
P d t or Brand
B d IImage
– Finance and other sources
– Plant location
– Logistics and Supply chain management
– Human resource and core competencies
–Production, Material Management capacity
–Marketing Skills

External Environment Demographic Environment – For market

segmentation
• The external environment consists of the
• Demographic Environment – Measurable characteristics
following: of Population
– Demographic – It is the collections of data by census/Survey in each country. It
is published data. This is required for market segmentation in the
– Economic host country. The data relates to the following:
– Political • Population
• Age
A wisei classification
l ifi ti
– Legal • District wise classification
– Social and Cultural • Income – High, Middle and Low
• Education and
• Occupation
• Family Size
• Religion
• Generation
• Nationality
• Rural, urban etc

Political Environment – Effect of Govt. Political Environment - Risks

• It is the direct or indirect effect of the system of • The political risks are of 4 types:
government and judiciary on international – Transfer Risk: The host country may impose
business. restrictions on the following:
• Transfer of money & Profits
• If political environment is not in favor for
• Transfer of capitals
international marketer then doing g business may y
• Transfer of peoples
be risky.
• Transfer or production equipment
• E.g. There were restrictions on export of textile • Transfer of technology
good from India to Europe and USA. – Operational Risk: The operational activities may by
constrained by taxation.

12
 Political Environment - Risks Political Systems
• Ownership control Risks • Democracy:
– The government may restrict the ownership of assets – Elected representative is for 5 years subject to their
performance.
• or only allow minor ownership by confiscation of properties.
– Normally democracy should develop business climate, individual
• Seizure of Business enterprise and help international business.
– E.g. Taiwan and India
– The ggovernment may y close business activities
abruptly with or without compensation to the • Totalitarian
international marketer. – Here Individual freedom and enterprise is totally restricted. The
power belongs to one man or a group.
• An international marketer usually cross check – E.g. China, Cuba and Myanmar.
the risks before taking Jobs and only enters if – Business here is risky, however china is progressing in
profits are there. international trade
• due to its focused attention on economic policies.

Legal Environment – Different laws to Legal Environment

regulate
• MNCs are giving importance to political and legal issues
• It is the legal system in the host country which includes when they enter into international business.
– different laws that regulate the companies and Individuals. • The important consideration are:
• The legal system arms which affect the international – Intellectual Property – Patent, trade marks, technology etc.
trade are: – Piracy
– Civil Laws – Bribes
– Contract Laws – Infrastructure
– Patent Laws – Working conditions
– Tax Laws – Discriminations – unfair treatments of a group
– Competitive Law • Indian system should be pro active towards
– Dispute resolution like conciliation/reunion, arbitration/settlement international business like china to grow further.
and litigation/Legal Action.

Cultural Environment – Socially Learned Dimension of Culture

Behavior
• Power Distance - Hierarchy
• This is the very important aspect of international – It is the culture of giving powers to higher level people
business environment. Culture is social behavior which in the organization as others obey their orders.
comes by
– learning from parents, teachers, friends and society. It is not – E.g. MD instructing managers
inherited. – E.g. Head of the family takes related decisions.
• Different culture makes – E.g.
E g India comes under this factor
– people to perceive and think differently and
– set their own priorities. • Uncertainty Avoidance – By making guidelines
• Culture affects the following: – It is the culture of making rules and regulations to run
– Individual Values a business so that uncertainty in actions can be
– Group Values avoided.
– Work Values
– Managerial Attitude and decision making –E.g. You cannot say no for project related to out of
– Interpersonal Relations station
– Ethical Levels

13
 Dimension of Culture Cultural Environment – Internal = External
• Individualism • When doing International business, the internal
– It is Culture of looking after your self and your culture environment should match with the
families. external culture environment.
• Masculinity • Effective manager in international context
– It is the culture of g
giving
g importance
p to money,
y should focus on the following:g
material, status and success by working hard and
taking challenges
• Very high degree of cultural understanding of
• Femininity
the foreign market.
– It is the culture characterized by caring others, ethical
values and quality of life. • Respect and appreciation of foreign culture

Economic Environment – 4 Types Economic Environment – Classification By

Income
• The economic forces that are prevailing a
country is called economic environment. It may • The countries are put in 4 categories based on
be classified as: their incomes in year 2000:
– By Income – Low Income Countries: Per capita less than 735 US$
– By Region – Low Middle Income: Between 736 to 2995 US$
– By Economic System – Upper Middle Income: Between 2996 to 9265 US$
– By Trade Policies – High Middle Income: 9266 US$ & above
– Developing countries: LIC, LMC and UMC (2500 –
10000 – 30000 – Above 30000 per month)
– Developed Countries: HMI. High education and
quality of life. IB Scope here is good.

Economic Environment – Classification By Economic Environment – Classification By

Region Economic System
• Classification By Region: • Market Economy Or Capitalism: Private world
• The major regions are: – Here all the products and services are owned by
Private enterprises. E.g. USA
– USA and Canada
– East and central Europe
p
• Command Economy Or Socialism: Government
world
– Latin America and Pacific
– Here Government owns and runs the business in the
– Central Asia country for goods of its people.
– East Asia and Pacific – Government decides what to produce, when to
– Middle east and north Africa produce and how much to produce.
– South Asia • Mixed Economy
– Sub Saharan Africa – Here Government and private player owns and runs
the business in the country. E.g. India

14
 Economic Environment – Classification By
Trade Policies
• It may be classified as
• Inward looking economy:
–It does not encourage export
•Chapter: 7
• Outward Looking Economy:
–It encourages export.
• E.g. India till 1990 was an inward looking
economy but now it is outward looking economy.

Glimpses of English &

Indian Landscape
Stratford,
Cotswold
Ashwell, &
Lake District

The Future Of Rural India.

India
Why Rural Is Important To Us?

Where Does India Live

GDP share Population Large

Cities 53 large
25% 12 % cities 1 Million
+
7,887
29% 18% <1
towns
Small Towns Million

50% 70 %
Per capita GDP
<
10,000
Challenges of
in rural regions Villages Doing
has grown at a
CAGR of 6.2 per (650,000)
cent since 2000. 850 mn consumers Business in
Source : Census of India 2011,, India Urbanization Econometric Model -McKinsey
89centre
Global Institute ,MART Knowledge
Rural & Small 90

T I di

15
 Understanding Diversity … A Snapshot Tale of Three India's…Where to go

J&K
21 official languages, 432 dialects INDIA 1 2 3
4 major religions PunjabHP
56 Socio Cultural Regions TV 50 2 12 Haryana

ownership(%) 5 Rajasthan UP
Bihar
Bihar
4 wheeler 4 1. 0. Gujarat MP Jharkhand WB
Kerala ownership (%) 5 9
Literacy 63% Chattisgarh
93% Maharashtra Orissa
GDP Share 30 3 36
(%) 4 AP
Population 20 3 50 Karnataka
Per Capita Goa Bihar (%) 0 TN
TN
Income 3700 470 Kerala
(USD per annum)

Source : Census of India 2011,, Directorate of Economics & Source : Max NCAER Survey, 2007 and IRS 2011
Statistics 2012 ,MART Knowledge centre 91 92
(c)MART

Consumption Story

93 94

Urban And Rural Household Spending

Spending In 2015 (US $)

Source : Max NCAER Survey, 2007

• 50% of India’s income comes from rural

• Percentage of disposable income in rural Rural catching up fast with urban
similar to urban

16
 Opportunities--Rural Market
Opportunities
• Increase in population and hence increase in demand.
• Rural income rising sharply.
• Increased literacy rate.
• High potential - one of the world’s largest booming
markets
• Agrarian prosperity- monsoons dependent.
• Green/white revolution.
• Crave For Modernization
Modernization- More aspirational.
• A deep desire to provide their children a better future
through education and healthcare
• Believe brands are trustworthy and reliable. trading
up and seeking more features that enhance their
social image
• Better connected in both the physical and digital
sense.
• Street-smart about common retailer ploys and
schemes
98

Rural Merchandise Rural Is Brand Conscious But

Fakes Are A Big Challenge
Retailing

Villages have
become
consumer
durable sale
points

Consumption Pattern
Sale of Branded Mini
Mini-- Mono Block Consumer Durable Ownership
Pump
Rur
Urban
al
Total market 75 lacs Television 37 78
size units Electric Iron 14 42
Refrigerato
C
Crompton 16 lacs
l r
6 35

Usha 5 lacs Two

11 29
wheeler Lots of catching up
Kirloskar 10 lacs Pressure
24 73 to do
Unorganised 50 lacs Cooker

Source : IRS

17
 Reasons Why Companies Are For Going
Rural vs Urban Rural
Retail Stocking • Size of market
• Largely untapped
Category Av no. brands per
• Too crowded urban market
retailer • Income on the rise/ disposable income
Rural Urban • Income from other than agriculture
Toothpaste 3 7 • Better exposure-
exposure media
• Great success stories
Toothbrush 3 6 – Unilever (> 50%)
– Colgate (50%)
Biscuits 3 9 – LG (50%)
– Asian Paints (60%)
Hair oil 3 7 – Dabur (40%)
– Cadbury (25%)
Source : ORG – Hero Honda (40%)

Reasons For Going Rural Key Challenges

• Media creating an impact creating awareness 4- A’s 4- P’s

• Government policies
– White revolution (Milk products) ƒ Awareness
– Yellow revolution (Poultry & edible oils)
Promotion
– Blue revolution (Aqua culture)
ƒ Affordability Price
• Emp
Employment
oyment schemes
ƒ Availability Pl
Place
• Rural electrification
• Money spent on medical & health, sanitation, primary • Acceptability Product
education
• Growth stories
– Coca Cola growing over 35% in rural areas compared to 22% in urban
Availability and Affordability are the two most
– There are 3000 HH in rural areas that earn > than Rs.50 lacs/ year (USD 85,000) critical

Rural Products

•Easy to use
•After sales service
Innovative Practices At The Bottom of
•Conveniently packed- success of sachet the Pyramid
•Simple product literature
•Easy to identify- having a logo

18
 Developing Products & Services for
the BOP Same Product Different Positioning
Basic economics of BOP market are based on:
Anything that has a value in exchange. Companies need Presented as Aspiration
to develop products and services that address the unique
needs of customers, innovate on the mobility platform to drive Luxury remains the
awareness for their brands and increase their physical as well (splurging same. How
as mental reach to win loyalty.
money)
y) you present
•Product
P d t tto beb marketed
k t d with
ith requirements
i t off rurall
India should not be an extension of the urban offering makes the
•Philips launched Free Power Radio – does not require difference
battery/ electricity. Wind with a lever and radio runs for
30 min.
•Small unit packages
Presented as
• Low margin per unit
a medicinal
• High volume tonic
• High return on capital employed

Product & Price Decisions Same Product Two Different Type of

Consumer
• Tailoring products, including packaging them and
giving them Brand names, to give a rural image
Presented
• Related to rural life and mindset as Luxury
– (eg. Stressing daily need in stead of luxury)
• Routine buying products should be of lower prices
Same
and in case of durables, they look for reasonably product two
priced products. positioning
• Few examples:
Release your
self from
stress
(stress
buster)

a) Products Related To Health And b) Products Based On Affordability

Protection
• Cadbury launched chocolate flavored biscuits so • Small size packs with low prices are popular
that rural mothers opt for these biscuits rather than
chocolates
Solar Powered
p
phone

Godrej Chotukool

19
Example: Disruptive Innovation, Heralding New Disruption in Healthcare: The
Emerging Business Models And Organizational
Processes. Ambupod
One patient, micro-
ambulance cum
telemedicine
enabled rural
Health platform.
Th low-cost vehicle
This h
The Tata Ace is a mini-truck will enable
ChotuKool, the mini refrigerator (similar to Japanese Kei truck
made for rural India doesn’t launched by Tata motors). It is in healthcare and
have a compressor. It actually competition with the prevalent ambulance services
opens from top, runs on three-wheeled goods carriers. The 3-
batteries. wheeler tempos, considered unsafe,
at the most distant
The refrigerator weighs only 7.8 has been slowly replaced by this new of villages.
kg, runs on a cooling chip and a Tata model.providing ‘last mile
fan similar to those used to cool transportation’
computers. Price: $

c) Products With Simple Packaging Road Show/ Video on Wheels

US 8
¢

Coca Cola template to

crack rural market

The 4 A’s

Awareness Affordability

•Excellentnetwork of dealers
•Easy availability of
•Villagers& in neighbourhood
owned it. Good Word-of-mouth loan
SUBRAMANIAM BUYS
SU U S A MOPED:
O TVS
S 50 • Other mopeds faced problems
•Minimal breakdown -
•Wife saw children being dropped
The 4A’s to school an essential deciding
•TVS was spotted at repairer’s factor.
shop
•Good resale value
•Manufactured in home state

20
 The 4 A’s

Availability Acceptability
Social Marketing
•Excellent network of •Subramanium had to
dealers perform number of
household chores.
•Preferred to wait
•Needed tot carry perishable
e i h ble
despite other mopeds product such as milk twice
were available across daily
the shelf. •Hassel free service & spares
•Reduced perceived risk •When the bullocks are
engaged in the field, the
children walk the distance,
which happens at least once
in a fortnight

Social Marketing Social Marketing Concept: Behavioral

change
• Important to know
• Action programs designed to increase the acceptability
–It is a part of CSR for organizations
of
–Some companies resort to Promotion of product – social idea, image, cause or practice among a target group
related social causes • For social welfare
• E.g. Dettol Swine flu campaign • Action program to guide the public
– away from products that are harmful for them (e.g. drugs, tobacco
and alcohol) or
– to direct them towards products that are helpful for them or
society (e.g. praying together, condoms etc.)
• This is usually done by non profit organization,
government or quasi government agency.
• E.g.
– Publicity campaign for prohibition of smoking in Delhi explained
the place where one can and cannot smoke in Delhi

Social Marketing Concept Social Products

• Spreading socially beneficial ideas to influence • Ideas
or change the behavior of – Present to influence the belief of target audience
– E.g.
–Society, public, individual, target people etc.
• Smoking cause cancer
• But why? • Practice
–Assuming
Assuming it will do greater justice to society and – Action program for social welfare
nation at large – E.g.
• Purpose • Pulse polio campaign

–Social welfare • Tangible or physical products accompanying social

campaign
– Serve as a tool for social welfare
– E.g.
• Use of condoms, copper T, Pills for family planning
• Use of ORS for fighting dehydration

21
 Requirements for a social marketer Ps of Social Marketing
• Knowledge of target markets and • Product
– their bases for segmentation
• Knowledge of reference groups who can influence action • Price
program such as • Place
– Permission granting groups
• Means getting legal authorization for program • Promotion
– Support
S group • Publics
P bli
• Practicing practitioners such as doctors, consultants for delivering
the program • Partnership
– Opposition group
• Policy
• Religious groups and ethical groups standing against the ideas
– Evaluation group
• Legislative committees whose evaluation may have positive or
negative impact on the social marketing program

Product Price
• Desired behavior communicated to the audience • Cost (financial, emotional, time, psychological)
• Associated benefits or barriers
• Tangible objects or services that support –in making the desired behavior change
behavior change • E.g.
• E.g.
Eg –Giving
Giving up drinking involves costs in the form of
• Loss of company of friends
–Giving up drinking is the desired behavior
• Loss of social status and relaxation
–This will offer benefits such as
• savings, family happiness and good health
–Medicines that will help in giving up drinking

Place Promotion
• Locations to access products for social and • Communication through media channels
perform desired behavior • Communication through Promotion materials
• E.g. and activities
–Placing condom vending machines in a club, court or
bathroom etc.
–Offering nutritional information on a grocery store food
shelf
–Offering immunizations in a neighborhood clinin

22
 Publics: Group of people Partnerships
• Internal and external people • Tie up with other organizations in the community
–involved in the program that have similar goals for creating synergy
• External people includes • E.g.
–Target audience, policymakers, gatekeepers etc. • Tie up with NGOs
• Internal people includes
–Any one who is involved in the implementation of the
program

Policy 10 Strategic questions in social marketing

• Legislative decisions that help • Identification of social or health problem
• Designing actions that best address the problem
–remove barriers and change the behavior of target
• Identification of people to be influenced (Target
audience audience)
• E.g. • How the new behavior is beneficial compared to existing
behavior
–A legislation
g p
prohibiting
g child labor is important
p to curb
• Recognize how much trust worthy your action is
child employment practices
• Compare your offer with competition
• Identifying the best time and place to reach members of
your audience
• Determine the frequency of interventions so that it works
• Integrate a variety of interventions to influence behavior
• Check for requirement of partnering with other
organizations or not

Case studies National Rural Health Mission Campaigns

• Case of HUL – Project Shakti • Safe Motherhood
• Case of ITC – e Chaupal • Family Planning
• Case of HLL – Social marketing • Child Care
• Case of Colgate - Education • Adolescent reproductive and sexual health etc.

23
 Safe Motherhood Family Planning
• Chiranjeevi Youhana in Gurarat, • United states agency for international
• Ayushmati scheme in west Bengal, development funds and ICICI bank implements
• Mamta Friendly hospital Initiative in Delhi and –the Bindaas Bol campaign in 9 States
• to promote condom use by men through IMC.
• Saubhagyawati scheme in UP
• The Aadarsh Dampati
p Samman has been
• The
Th above
b are h
health
lth fifinancing
i schemes
h instituted in UP
–under public private partnership model
–to encourage family planning behavior among men
• to benefit women belong to the below poverty line category through male sterilization.
• They aim at providing emergency obstetric care • Under this scheme, Rs. 500 is awarded and role
and transport services model category is provided to those men

Child Care Adolescent reproductive and sexual health

• A community based approach, Kano Parbo na is • The Saathiya youth friendly Project in UP is a
started in west Bengal program that
–aimed at reducing low birth weight and malnutrition –aims to educate out of school girls on contraception
• The scheme tries to improve feeding practices of mothers and sexual health.
• The Ankur p
project
j in Maharashtra p
provides • Training
g is imparted to the g
girls at yyouth
–care for new born babies at home information centers
• by community health workers

Marketing of Family Planning Marketing of AIDS Prevention

• HLL Distributed contraceptives through rural • AIDS Awareness campaigns are organized
youth and • Government agencies, NGOs and corporate
–encourage their use through local media based enterprises
program –are working together to create synergistic effects
• Reliance conducts mass awareness programs
for HIV and other health issues
–through health camps in the form of sessions
• Diagnostic and referral services are also provided

24
 Social marketing ads
• Pulse polio Amitabh Bachan public awareness
campaign
• Social awareness ad campaign
•SUSTAINABLE
• Social marketing Aaj Tak
• Social awareness ad campaign cancer MARKETING
• Social marketing Aaj tak
• Census of India
• NACO Muqadar ka Sikandar

Sustainable Marketing Sustainable Marketing

• Save resources and protect environment for Meeting needs of consumers while preserving the ability
future generations of future generations to meet their needs

• Run Nokia Tree Plantation Ad

• Figure
Fi 20.1
20 1

Sustainable Marketing: 5E Sustainable Marketing: 6P

• End user rights to be protected (Consumerism) • Portfolio or product lines
• Environmental protection • Partnerships
• Ethics • People
• Earnings or Profit • Planet
• Effect
Eff t on future
f t generations
ti • Profit
P fit
• Productivity

25
 VISION:CocaCola Principles of Sustainable Marketing
• People: Be a great place to work where people are • CS, CV, CRM
inspired to be the best they can be.
• Portfolio: Bring to the world a portfolio of quality • Innovation marketing
beverage brands that anticipate and satisfy people's • Societal marketing
desires and needs.
• Partners: Nurture a winning network of customers • Social marketing
and suppliers
suppliers, together we create mutual,
mutual enduring • Green
G Marketing
M k ti
value.
• Planet: Be a responsible citizen that makes a
difference by helping build and support sustainable
communities.
• Profit: Maximize long-term return to shareowners
while being mindful of overall responsibilities.
• Productivity: Be a highly effective, lean and fast-
moving organization.

Social Criticisms of Marketing

Marketing’s Impact on Individual Consumers

High Prices

Deceptive Practices
High-Pressure Selling
Shoddy, Harmful or Unsafe Products
Planned Obsolescence
Poor Service to Disadvantaged
Consumers

Social Criticisms of Marketing Social Criticisms of Marketing

Marketing’s Impact on Individual Marketing’s Impact on Individual Consumers
Consumers Deceptive Practices
High Cost of Distribution
Complaint: Companies use deceptive practices that
Complaint: Response: lead customers to believe they will get more value
• Prices are too high due • Intermediaries are than they actually do
do. These practices fall into three
to high costs of: important and offer value categories:
• distribution • Advertising informs • Deceptive pricing
• Advertising and buyers of availability and
promotion merits of a brand • Deceptive promotion
• Excessive mark-ups • Consumer’s don’t • Deceptive packaging
understand the cost of
doing business

26
 Social Criticisms of Marketing Social Criticisms of Marketing

Marketing’s Impact on Individual Consumers Marketing’s Impact on Individual Consumers

Deceptive Practices Deceptive Practices
High-Pressure Selling
Response:
• Complaint: Salespeople use high-pressure selling
Support Legislation to protect consumers from that persuades people to buy goods they had no
deceptive practices
intention of buying
buying.
Make lines clear—Is it deception, alluring, or puffery
that is just an exaggeration for effect? • Response: Most selling involves building long-term
relationships and valued customers. High-pressure or
• Products that are harmful
deceptive selling can damage these relationships.
• Products that provide little benefit
• Products that are not made well

Social Criticisms of Marketing Social Criticisms of Marketing

Marketing’s Impact on Individual Consumers Marketing’s Impact on Individual Consumers
Deceptive Practices Deceptive Practices

Planned Obsolescence
Shoddy, Harmful, or Unsafe Products
• Complaint: Producers cause their products to
• Complaint: Products have poor quality, provide little become obsolete and change consumers’ concepts
benefit, and can be harmful. p
of acceptable styles
y to encourage
g more and earlier
• Response: Good marketers realize there is no value buying.
in marketing shoddy, harmful, or unsafe products. • Response: Planned obsolescence is really the result
of competitive market forces leading to ever-
improving goods and services; customers like style
changes and want the latest innovations.

Social Criticisms of Marketing Social Criticisms of Marketing

Marketing’s Impact on Individual Consumers
Deceptive Practices Marketing’s Impact on Society as a Whole
Poor Service to Disadvantaged Consumers
• Complaint: The marketing system serves disadvantaged customers
poorly. Some retail companies “redline” poor neighborhoods and avoid
placing stores there. False wants and too much
materialism
• Response: Some marketers profitably target these customers with
legitimate goods and services, and the consumer forum has taken action
against marketers that do advertise false values, wrongfully deny service, Too few social goods
or charge disadvantaged customers too much.

Cultural pollution

27
 Social Criticisms of Marketing Social Criticisms of Marketing
Marketing’s Impact on Society as a Whole
Marketing’s Impact on Society as a Whole
Too Few Social Goods
False Wants and Too Much Materialism

Complaint: Response: Complaint: Response:

• Th
The marketing
k ti system
t urges •P
Peoplel ddo h
have strong
t • Businesses oversell private • There needs to be a balance
too much interest in material defenses against advertising goods at the expense of between private and public
possessions. People are and other marketing tools. public goods and require goods
judged by what they own Marketers are most effective more public goods to • Producers should bear full
rather than who they are, when they appeal to existing support them social costs of their
creating false wants that wants rather than creating operations
benefit industry more than new ones. The high failure • Consumers should pay the
they benefit consumers. rate of new products shows social costs of their
that companies cannot control purchases
demand.

Social Criticisms of Marketing Social Criticisms of Marketing

Marketing’s Impact on Society as a Whole Marketing’s Impact on Other Businesses

Cultural Pollution
• Acquisition of competitors
Complaint: Response: • Unfair competitive marketing practices
• Marketing and advertising • Marketing and advertising are
create cultural pollution planned to reach only a target
audience, and advertising
makes radio and television
free to users and helps to keep
down the costs of newspapers
and magazines. Today’s
consumers have alternatives
to avoid marketing and
advertising from technology.

Consumer Actions to Promote Sustainable Consumer Actions to Promote Sustainable

Marketing Marketing
Consumerism

Traditional buyers’ rights include:

Consumerism is the organized movement of • The right not to buy a product that is offered for sale
citizens and government agencies to improve • The right to expect the product to be safe
the rights and power of buyers in relation to • The right to expect the product to perform as claimed
sellers • Comparing these rights, many believe that the
balance of power lies on the seller’s side

28
Consumer Actions to Promote Sustainable
Marketing Consumer Actions to Promote Sustainable
Marketing
Consumerism
Advocates call for:
• The right to be well informed about important aspects of the Environmentalism is an organized movement of
product concerned citizens, businesses, and
• The right to be protected against questionable products and government agencies to protect and improve
marketing practices people’s living environment
• The right to influence products and marketing practices in
ways that will improve the “quality of life”
• The right to consume now in a way that will preserve the world
for future generations of consumers

Consumer Actions to Promote Sustainable Consumer Actions to Promote Sustainable

Marketing Marketing
Environmentalism Environmentalism
Environmental Sustainability

• Environmental sustainability is getting profits • Pollution prevention

while helping to save the planet • Product stewardship
• Design for
f environment (DFE)
( )
• New clean technologies
• Sustainability vision

Consumer Actions to Promote Sustainable Consumer Actions to Promote Sustainable

Marketing Marketing
Environmentalism Environmentalism
Environmental Sustainability Environmental Sustainability
Pollution prevention involves not just cleaning up New clean technologies involve looking ahead
waste but also eliminating or minimizing waste
before it is created and planning new technologies for
Product stewardship involves minimizing the pollution competitive advantage
from production and all environmental impact Sustainability vision is a guide to the future
throughout the full product life cycle
that shows the company that the company’s
Design for environment (DFE) involves thinking ahead
to design products that are easier to recover, reuse, products, process, and policies must evolve
or recycle and what is needed to get there

29
Consumer Actions to Promote Sustainable Consumer Actions to Promote Sustainable
Marketing Marketing
Public Actions to Regulate marketing
Environmentalism
Environmental Sustainability

New clean technologies involve looking ahead

and planning new technologies for
competitive advantage
Sustainability vision is a guide to the future
that shows the company that the company’s
products, process, and policies must evolve
and what is needed to get there

Business Actions Toward Sustainable Business Actions Toward Sustainable

Marketing Marketing
Sustainable Marketing Principles Societal Marketing

Consumer- Customer-
Innovative
Oriented Value
Marketing
Marketing Marketing

Sense-of-
Societal
mission
Marketing
Marketing

Business Actions Toward Socially Business Actions Toward Socially

Responsible Marketing Responsible Marketing
Marketing Ethics Marketing Ethics

Corporate marketing ethics are broad • Who should guide companies?

guidelines that everyone in the organization • The free market and the legal system?
must follow that cover distributor relations
relations,
• Individual companies and managers?
advertising standards, customer service,
pricing, product development, and general
ethical standards

30
 Business Actions Toward Socially
Responsible Marketing
The Sustainable Company
•MARKETING PLAN
• Goes beyond caring for the needs of today’s
customers and has concern for tomorrow’s
customers and the broader world

Marketing planning Contents of a marketing plan - Sections

• Executive Summary
• Here the company decides – Major point’s review & recommendations
–what it wants to do with each business unit, • Current marketing situation
– Target market and its characteristics, Product mix, CoD, Competition
–how to achieve company objectives (strategies • Threats and opportunities analysis
required). – Goal is to understand external environment
• Objectives and issues
• A detailed marketinggp
plan for each business, – How to achieve objectives
product or brand is needed. • Marketing strategy
– Target market + marketing mix + Positioning while managing
environment
• Action programs (Implementation)
– What, when and who will do
– Marketing mix – operational strategies
• Budgets
– Profit and loss statement
• Controls
– Monitor planned results and take corrective action wherever necessary

Executive Summary – Plan’s major points Current marketing situation

review for top management
• It describe the target market and company’s
• It presents a brief summary of the position in including information about the
–main goals and recommendations of the plan for –Market description
management review, • Major segments, factors influencing customer purchasing
• helping top management to find the plan’s major points –Product performance
quickly
• Margin from the product line
–Competition and
• Position of competitors and their marketing mix
–Distribution
• Distribution channel

31
 Threats and opportunities analysis Objectives and issues involved
• It helps management to anticipate important • If the objective is to achieve 15 percent market
developments that have an impact on the firm share then how this objective may be achieved.
and its strategies.

Marketing Strategy Action Programs

• Target Market + Marketing Mix + Positioning. • Turning strategies into action programs that
• How to create value for customers answer the following questions:
• How to handle threats and opportunities etc. –What will be done
–When will it be done
–Who will do it
–How much will it cost

Budgets Controls
• Projected profit and loss statement. • Monitoring & reviewing results
• It shows • Understand Performance gap
–expected revenues (forecasted number of units sold • Identifying products that are not meeting their
and the average net price) and goals.
–expected
p costs ((Production, distribution and
marketing) and
• the difference is the projected profit and loss.
• Budget is the base for
–buying, producing, staffing and marketing operations.

32
 Marketing Implementation – Turning into Marketing Implementation – Doing things
actions right
• It is the process that turns marketing strategies • Implementation gain competitive advantage
and plans into marketing actions • This requires
–to accomplish strategic marketing objectives. –vision and mission,
• It addresses the following issues –team spirit,
–Who will achieve objectives –organizational structure,
–Where and when issues and –Skilled staff,
–How to achieve objectives –decision system,
–reward system and
–culture that support its strategies.

Marketing Implementation – Black and Marketing Implementation – Black and

Decker example Decker example
• Marketing implementation for company’s power • Marketing managers make decisions about
tools, outdoor equipment and other products –Target segments
require –Branding
–Day to day decisions and –Packaging
–actions by thousands of people both inside and –Pricing
outside the organization. –Promotion and
–Distribution

Marketing Implementation – Black and Marketing analysis, planning,

Decker example implementation and control
• Marketing managers talk (Integrating marketing) Analysis

–engineering about product design

–Manufacturing about product and inventory levels Planning Implementation Control
–Finance about funding and cash flows Develop Carry out the Measure results
–Outside organizations like ad agencies Strategic Plans plans

• to plan ad campaigns and news media to obtain publicity Evaluate Results

support Develop
Marketing Plans
–Retailers to advertise their products, provide ample Take corrective
shelf space and use company displays action

33
 Marketing Control – measuring gap + Marketing Control – Steps
Corrections
• Marketing control involve 4 steps
• The process of measuring and evaluating the –Setting specific marketing goals
results of marketing strategies and plans and –Measuring performance
–taking corrective actions to ensure that objectives are –Evaluate the causes of any differences between
achieved. • expected and actual performance
–Finally, taking corrective action to close the gaps
• between its goals and its performance.

Marketing Types
1. Strategic Marketing
2. Morph Marketing
Recent trends in Marketing 3. Meta Marketing
4. Relationship Marketing
5. Augmented Marketing
6. Direct Marketing
7
7. Enlightened Marketing
8. Online Marketing
9. Person Marketing
10. Place Marketing
11. Organization Marketing
12. Societal Marketing
13. Social Marketing: Cause and Cause Related
14. Green Marketing
15. Sustainable Marketing

Marketing Types Trends Contd….

1. Service Marketing: Interactive, internal and • Word of mouth marketing
external 1. Buzz marketing
2. De Marketing 2. Viral marketing
3. Synchro Marketing 3. Community marketing
4. Grassroot marketing g
4 Differential Marketing or Segment
4.
5. Evengelist marketing
5. Concentrated Marketing or Niche 6. Product seeding
6. Political marketing 7. Influential marketing
7. Ambush Marketing 8. Blog marketing
8. Guerrilla Marketing 9. Referral program marketing

34
 Trends Contd. Trends Contd.
1. Interactive marketing 1. Emotional marketing
2. Digital marketing 2. Holistic marketing
3. Database marketing 3. Performance marketing
4. E mail marketing 4. Corporate level marketing
5. Tailored or style or customize marketing 5. Business level marketing
6 Avalanche or snow ball marketing
6. 6 Functional level marketing
6.
7. Ghost marketing 7. Tele marketing
8. Online or web or cyber marketing 8. E marketing
9. Social media marketing 9. M marketing
10. Search engine marketing 10. Black marketing
11. Organic marketing 11. Business marketing
12. Inorganic marketing 12. Non business marketing

Trends Contd. Trends Contd.

1. Permission marketing
2. WoW Marketing 1. Customer ecstacy
3. Affinity marketing or partner marketing
4. Alliance marketing
2. Branching out
5. Call to action marketing 3. Glocalization
6. Content marketing
7. Cross media marketing 4. Discount shopping
8. Diversity marketing
9. Freebie marketing 5 Event
5. E t marketing
k ti
10. Free sample marketing
11. Scarcity marketing 6. Experience your competition
12. Undercover marketing
13. Humanistic marketing 7. Generic positioning
14. Formulated marketing
15. Entrepreneurial marketing 8. Modern marketing
16. Intrapreneurial marketing
9. Reverse sophistication
10.Pace marketing

Trends Contd. Dimensions

1. Robotic marketing 1. Consumer marketing
2. Leech marketing 2. Business marketing or Industrial marketing
3. Outsource marketing 3. Rural marketing
4. Instant marketing 4. Retail marketing
5. Product marketing
5 Dotcom
5. D t marketing
k ti
6. Service marketing
6. Integrated marketing
7. International marketing
7. Mass marketing 8. Research marketing
8. Segment marketing 9. Applied marketing
9. Niche marketing 10. Advanced marketing
10.Micro marketing

35
 Strategic Marketing – Designing 4 Ps Morph Marketing – Product with proper
service attitude
• System of integrated business activities or
program • Transforming products into service and
–designed to develop marketing mix in such a way that delivering undreamt of value to the consumer.
• leads to the satisfaction of customers wants (By Chaterjee)
– of selected market segments.
• 6 Laws of Morph Marketing
• Marketing Mix:
–Make the service a surrogate for product
–Product
–Track and solve customer’s problems
–Price
–Place –Mould your service through feedback
–Promotion –Create contact points with emotional value
–Note: Operational strategies have to be developed in –Educate customer about your service
each of the 4 areas. –Benefits from the service industry

Relationship Marketing – By giving

something special
Relationship Marketing
• It is the process of
The term relationship marketing refers to long-term and mutually
–creating, maintaining and enhancing strong beneficial arrangements wherein both buyer and seller focus on value
relationships
enhancement through the creation of more satisfying exchanges.
• with customers and other stakeholders.
• How
–By providing additional services, special recognition
and reward schemes to
• Regular and loyal customers
• E.g. British Airways offers
–special lounges with showers at 199 Airports for
frequent flyers
• to enhance relationship in a long way.

Relationship Marketing – By giving Augmented Marketing -

something special
• Additional benefits built around the actual
• Hutch Thank You card product.
–Scratch and SMS, you will get mileage on the basis of • E.g. Movies on demand
your history
• E.g. Online computer repair service
• BSNL Directory or instrument for those
customers • E.g.
E g Onsite warranty
–whose billing is more than Rs. 1000 per month

36
 Direct Marketing Enlightened Marketing
• Marketing with various media that interacts directly • Company’s marketing system should support the best
long run performance.
– with carefully designed target market to get a direct response.
• 5 Principles:
• E.g. – Customer oriented marketing
– Sending Mail • Identifying their need and fulfilling it
• E.g. – Innovating marketing
p
• Improving g on your
y products
p byy havingg a competitive
p edge
g
– Catalogue Selling
– Value marketing
• E.g. • Utilization of resources in to value building marketing investments
– Tele Calling – Sense of mission marketing and
• Company’s mission should be defined in social terms rather than
• E.g. narrow product terms
– Electronic Marketing – Societal Marketing
• Marketing decisions should take care of customers, company and
• E.g. society as a whole in the long run
– TV Shopping

Humanistic or Societal Marketing Concept Humanistic or Societal Marketing Concept

– Environment + Redesigning harmful – Environment + Redesigning harmful
products products
• The ideas that consumers will favor for those • It includes:
products and services – Company - Profit
– Customers – Want Satisfaction
–that improves the living standards of customers as
– Society – Human Welfare
wellll as society
i t iin th
the llong run.
• E.g.
• It is a principle of enlightened marketing which – Macdonald changed its oil
requires • E.g.
–the redesigning of such products which might harm – Khadi Gramdodyog sells recycled eco friendly paper, chart and
social interests. greeting cards.
–Firms to take care of social and ethical considerations • E.g.
while developing marketing strategies – Advertisement of Hamam Says, it is natural without adding
artificial fragrance or color.

Societal Marketing Concept Societal Marketing Concept

SOCIETY – HUMAN WELFARE

SOCIETAL
MARKETING
CONCEPT

CONSUMER WANT SATISFACTION COMPANY PROFIT SATISFACTION

37
 Societal Marketing Societal Marketing
Immediate Satisfaction
• Deficient Products
LOW HIGH
–E.g. Bad Taste, ineffective medicines
HIGH Salutary products Desirable products

Long Run
• Pleasing Products
Consumer –Junk Food, Cigarettes
Benefit
Deficient products Pleasing products
• Salutary Products
LOW
–Helmets, insurance products
• Desirable Products
Note: Company should turn their products into desirable products –Tasty and nutritious breakfast

The Societal Marketing Concept

Societal marketing concept is a management philosophy that takes into
account the welfare of society, the organisation, and its customers.

38
 More Examples Social Marketing Concept
• GE’s Energy Smart Compact Fluorescent light • Action programs designed to increase the acceptability
of
bulb – social idea, image, cause or practice among a target group
–Provide lighting, saves energy and long life • For social welfare
• Johnson and Johnson Stress Honesty, integrity • Action program to guide the public
and p
putting
gppeople
p before p
profits – away from products that are harmful for them (e.g. drugs, tobacco
andd alcohol)
l h l) or
– to direct them towards products that are helpful for them or
society (e.g. praying together, condoms etc.)
• This is usually done by non profit organization,
government or quasi government agency.
• E.g.
– Publicity campaign for prohibition of smoking in Delhi explained
the place where one can and cannot smoke in Delhi

Services Marketing
• Service is an activity or benefit that one party
can offer to another
–that is essentially intangible and
–does not result in the ownership of anything.
• E.g.
g
–Courier, Transportation etc.

Organization marketing – Attitude Person Marketing

development
• Activities undertaken to create, maintain and
• Activities undertaken to create, maintain and change attitude and behavior toward particular
change attitude and behavior of target people.
audiences towards an organization. • E.g.
• It is p
practices by
y both –Politicians,
o t c a s, sports
spo ts sta
stars,
s, film stars,
sta s, etc.
etc promote
p o ote ttheir
e
–Profit based organization careers and income
–Non profit based organization

39
 Place Marketing Concentrated Marketing
• Activities undertaken to create, maintain and • A market coverage strategy
change attitude and behavior toward particular –in which a firm goes after a large share of
Place. • one or a few sub markets
• E.g.
–Business
Business sites marketing, tourism marketing
–www.nurseryadmissions.com

Differential marketing De--Marketing – Reducing Demand

De
• A market coverage strategy in which firm • It is the process of reducing the demand for the
decides to target goods either temporarily or permanently by
–several market segments and designs separate offers
selecting fewer customers that it can serve and
for each. profitably.
• E.g.
g • Aim –
–Not
N t to
t destroy
d t demand
d dbbutt reduce
d or shift
hift it.
it
–HLL has lifebuoy, Lux and Rexona in popular segment
and • E.g.
–Liril and pears in premium segment –Zoological parks are over crowded on Saturday,
Sunday and holidays.
• Here De-marketing can be applied to regulate
demand

Synchro--marketing – Settling down with

Synchro
irregular demand
• Irregular demand cause idleness and over load,
synchromarketing can be used to alter the same
pattern of demand
–through flexible pricing, promotion and other
incentives.

40
 Online Marketing – Form of Direct Social Media Marketing – Growth through
Marketing online sharing
• Company activities to market products and • Process of promoting business through social
services and build customer relationships media channels for communication
–over the internet is called online marketing –by providing the way people share their
• ideas, content, thoughts and relationships (online)
– in the form of text, audio, video, images and communities at
lesser cost.

Examples of Social Media Marketing Types

• Strategic Marketing
• Face book • Morph Marketing
• Relationship Marketing
• Linked in • Augmented Marketing
• Twitter • Direct Marketing
• Enlightened Marketing
• Blogs • Online Marketing
• Person Marketing
• You
Y T Tube
b • Place Marketing
• Organization Marketing
• Societal Marketing
• Social Marketing
• Green Marketing
• Service Marketing
• De Marketing
• Synchro Marketing
• Differential Marketing
• Concentrated Marketing
• Social Media Marketing

AFFINITY MARKETING
• ALSO KNOWN AS PARTNERSHIP MARKETING,
THIS TECHNIQUE LINKS COMPLEMENTARY
BRANDS, THEREBY CREATING STRATEGIC
PARTNERSHIPS THAT BENEFIT BOTH
COMPANIES. WHILE ONE ADDS VALUE TO
EXISTING CUSTOMERS BY GENERATING MORE
INCOME, THE OTHER BUILDS NEW CUSTOMER
RELATIONSHIPS 24 24
5 6

41
ALLIANCE MARKETING - AMBUSH MARKETING -
•THIS STRATEGY IS USED BY ADVERTISERS TO
•HERE TWO OR MORE ENTITIES COME CAPITALIZE ON AND ASSOCIATED THEMSELVES
TOGETHER TO POOL IN THEIR RESOURCES WITH A SPECIFIC EVENT WITHOUT THE
TO PROMOTE AND SELL A PRODUCT OR PAYMENT OF ANY SPONSORSHIP FEE
FEE, THEREBY
SERVICE, WHICH WILL NOT ONLY BENEFIT BRINGING DOWN THE VALUE OF SPONSORSHIP.
THEIR STAKEHOLDERS, BUT ALSO HAVE A IT HAS SUB-CATEGORIES LIKE DIRECT OR
GREATER IMPACT ON THE MARKET. PREDATORY AMBUSHING OR INDIRECT
24 AMBUSHING BY ASSOCIATION,
24 TO NAME A FEW.
7 8

CALL TO ACTION (CTA)

MARKETING
•- CTA IS A PART OF INBOUND MARKETING
USED ON WEBSITES IN THE FORM OF A
BANNER, TEXT OR GRAPHIC, WHERE IT IS
MEANT TO PROMPT A PERSON TO CLICK IT
AND MOVE INTO THE CONVERSION FUNNEL,
THAT IS, FROM SEARCHING TO NAVIGATING
24 AN ONLINE STORE TO CONVERTING
25 TO A
9 SALE. 0

COMMUNITY MARKETING -
•THIS TECHNIQUE CATERS TO THE NEEDS AND
REQUIREMENTS OF THE EXISTING CUSTOMERS,
AS OPPOSED TO USING RESOURCES TO GATHER
NEW CONSUMERS. THIS PROMOTES LOYALTY
AND PRODUCT SATISFACTION AND ALSO GIVES
RISE TO WORD OF MOUTH MARKETING AMONG
THE COMMUNITY.
25 25
1 2

42
 CONTENT MARKETING -
•IN THIS CASE, CONTENT IS CREATED AND
PUBLISHED ON VARIOUS PLATFORMS TO
GIVE INFORMATION ABOUT A CERTAIN
PRODUCT OR SERVICE TO POTENTIAL
CUSTOMERS AND TO INFLUENCE THEM,
WITHOUT MAKING A DIRECT SALES PITCH.
25 25
3 4

CROSS-MEDIA MARKETING -
•AS THE NAME SUGGESTS, MULTIPLE
CHANNELS LIKE EMAILS, LETTERS, WEB
PAGES ETC ARE USED TO GIVE
INFORMATION ABOUT PRODUCTS AND
SERVICES TO CUSTOMERS IN THE FORM OF
CROSS PROMOTION.
25 25
5 6

DIGITAL MARKETING -
•THIS STRATEGY USES VARIOUS DIGITAL
DEVICES LIKE SMARTPHONES,
COMPUTERS, TABLETS OR DIGITAL
BILLBOARDS TO INFORM CUSTOMERS AND
BUSINESS PARTNERS ABOUT ITS
PRODUCTS. INTERNET MARKETING IS A
25 KEY ELEMENT IN DIGITAL25MARKETING.
7 8

43
DIVERSITY MARKETING -
•THE AIM OF THIS STRATEGY IS TO TAKE
INTO ACCOUNT THE DIFFERENT
DIVERSITIES IN A CULTURE IN TERMS OF
BELIEFS, EXPECTATIONS, TASTES AND
NEEDS AND THEN CREATE A CUSTOMIZED
MARKETING PLAN TO TARGET THOSE
CONSUMERS EFFECTIVELY.
25 26
9 0

EVANGELISM MARKETING -
•IT IS SIMILAR TO WORD-OF-MOUTH
MARKETING, WHERE A COMPANY
DEVELOPS CUSTOMERS WHO BECOME
VOLUNTARY ADVOCATES OF A PRODUCT
AND WHO PROMOTE ITS FEATURES AND
BENEFITS ON BEHALF OF THE COMPANY.
26 26
1 2

FREEBIE MARKETING
•- HERE A PARTICULAR ITEM IS
SOLD AT LOW RATES, OR IS GIVEN
AWAY FREE, TO BOOST THE SALES
OF ANOTHER COMPLIMENTARY
ITEM OR SERVICE.
26 26
3 4

44
FREE SAMPLE MARKETING -
•UNLIKE FREEBIE MARKETING, THIS IS
NOT DEPENDENT ON COMPLIMENTARY
MARKETING BUT RATHER CONSISTS
MARKETING,
OF GIVING AWAY A FREE SAMPLE OF
THE PRODUCT TO INFLUENCE THE
CONSUMER TO MAKE26 THE PURCHASE. 26
5 6

GUERRILLA MARKETING -
•UNCONVENTIONAL AND INEXPENSIVE
TECHNIQUES WITH IMAGINATION, BIG
CROWDS AND A SURPRISE ELEMENT
ARE USED FOR MARKETING
SOMETHING, A POPULAR EXAMPLE
BEING FLASH MOBS. 26 26
7 8

VIRAL MARKETING SCARCITY MARKETING:

•WHERE APPROPRIATE,
CONSIDER MAKING YOUR
PRODUCTS ACCESSIBLE TO
ONLY A FEW CUSTOMERS.
26 27
9 0

45
 UNDERCOVER MARKETING
•HIDE SOME OF YOUR PRODUCTS AND
• ROLLS-ROYCE’S RELEASE OF THEIR YEAR OF THE DRAGON COLLECTION SERVICES’ BEST FEATURES.
EDITION OF THE PHANTOM SOLD QUICKLY
QUICKLY. ALTHOUGH THE COST OF THE CAR
WAS HIGHER THAN OTHER LUXURY CARS, THE SCARCITY DROVE THE DESIRE SOMETIMES NOT TELLING EVERYONE
AND THE PRICE.
EVERYTHING CAN BECOME A GREAT
SOURCE OF BUZZ.
27 27
1 2

VIRAL MARKETING: HUMANISTIC MARKETING:

•GET YOUR CUSTOMERS TALKING ABOUT
YOUR PRODUCTS AND SERVICES BY
HITTING ON SOMETHING SO GREAT THAT • HUMAN NEEDS ARE “A STATE OF FELT DEPRIVATION.” THEY DISTINGUISH
BETWEEN PHYSICAL NEEDS (FOOD, SHELTER, SAFETY, CLOTHING), SOCIAL
PEOPLE CAN’T HELP BUT SHARE WITH NEEDS (BELONGING AND AFFECTION), AND INDIVIDUAL NEEDS (KNOWLEDGE,
SELF-EXPRESSION). NEEDS ARE A RELATIVELY NARROW SET OF NON-
OTHERS. EACH TIME A NEW PRODUCT IS CULTURAL STATES OF FELT DEPRIVATION.

CREATED, CUSTOMERS HAVE TO BE GIVEN

A REASON TO DREAM ABOUT
27 THEIR 27
FUTURE PURCHASE. 3 4

46