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Ch.5 Marketing

The document discusses the importance of marketing for new ventures, including defining key concepts like markets, marketing, and market research. It outlines the purpose and benefits of conducting market research for a new venture to understand customers, competitors, and evaluate marketing strategies. Finally, it provides details on developing a marketing plan, with sections on gathering information, interpreting data, developing marketing strategies, and creating a marketing information system.

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Ritik Mishra
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0% found this document useful (0 votes)
25 views22 pages

Ch.5 Marketing

The document discusses the importance of marketing for new ventures, including defining key concepts like markets, marketing, and market research. It outlines the purpose and benefits of conducting market research for a new venture to understand customers, competitors, and evaluate marketing strategies. Finally, it provides details on developing a marketing plan, with sections on gathering information, interpreting data, developing marketing strategies, and creating a marketing information system.

Uploaded by

Ritik Mishra
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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CHAPTER-5

MARKETING
THE MARKETING CONCEPT FOR
ENTREPRENEURS

Market
Market
Knowledge
Knowledge

Marketing
Marketing Marketing
MarketingConcept
Concept Market
Market
Plan
Plan for
forEntrepreneurs
Entrepreneurs Research
Research

Pricing
PricingStrategy
Strategy
Approach
Approach
****Marketing Skills of Great Entrepreneurs
1. They possess unique environmental insight, which they use to spot opportunities that others overlook or
view as problems.
2. They develop new marketing strategies that draw on their unique insights. They view the status quo and
conventional wisdom as something to be challenged.
3. They take risks that others, lacking their vision, consider foolish.
4. They live in fear of being preempted in the market.
5. They are fiercely competitive.
6. They are meticulous about details and are always in search of new competitive advantages in quality and
cost reduction, however small.
7. They lead from the front, executing their management strategies enthusiastically and autocratically.
They maintain close information control when they delegate.
8. They drive themselves and their subordinates.
9. They are prepared to adapt their strategies quickly and to keep adapting them until they work. They
persevere long after others have given up.
MARKETING RESEARCH FOR NEW-VENTURES
What is a Market?:- A group of consumers (potential customers) who have purchasing power and
unsatisfied needs. A new venture will survive only if a market exists for its product or service (market niche).

What is Marketing? :-"Marketing is the management process responsible for “Identifying, anticipating and
satisfying” customer requirements profitably”.

What is Market Research:- Market research is the study of customers and the market.
What is Marketing Research?:- Marketing research is the study of all aspects of marketing. It is about
gathering of information about a particular market, followed by analysis of that information.

What is marketing plan:- The marketing plan will help determine who the target market is, how best to
reach them, at what price point the product or service should be sold, and how the company will measure its
efforts.
***MARKETING RESEARCH FOR NEW VENTURES:
Q- Is Marketing Research relevant to Entrepreneurs?
Purpose and Objectives
1. Marketing research is the first step in developing marketing plan for
launching a new business to improve the odds of success.
2. Marketing research provides data about customers, competitors and
effectiveness of marketing strategies, so as to develop a framework for
the implementation of strategies that would yield expected results.
3. To determine the feasibility of a new business, test interest in new
products/services, improve the aspect of business etc.
4. Overall, the purpose is to chalk out some strategy to market the product
or services that would give rise to a competitive advantage.
BENEFITS OF MARKET RESEARCH?

1. Market research increases the chances of success of a new-Venture.


2. Help in identification of opportunities and prepare against adverse market
responses.
3. Continuously learning about the outcome of marketing strategies.
4. Decrease risks about new products introduction in the markets
5. Help in constantly improving overall marketing strategy.
6. Knowing about customers, competition and outcome of marketing strategies.
7. Marketing research gives basic marketing benchmarks that an entrepreneur
should act on to compete in the market.
Q-Explain the purpose and benefits of Market research for a new venture?
MARKETING STRATEGY
Meaning:- Marketing strategy is the ‘fundamental goal of increasing sales, expanding market share,
and achieving a sustainable competitive advantage over the competitor’.

******Explain the marketing strategy for a New Venture in details?


1. Gathering Information
(a) Primary Data : It is the information that is gathered specifically for the research at hand (like
identifying target market & Customers, market characteristics, market potential, competitor analysis,
estimated market share and sales analysis, identifying and forecasting market trends, sales forecasting, new
products and services and its potential, pricing strategies etc)

(b) Secondary Data: It is the information that has already been compiled and available with Firm.
Advantage: Less expensive and available.
Disadvantages: Outdated, lacks specificity, questionable validity.
2. DEVELOPING AN INFORMATION-

• Make sure each question pertains to a specific objective in line with the
purpose of the study.
• Place simple questions first and difficult-to-answer questions later in the
questionnaire.
• Ask: “How could this question be misinterpreted?” Reword questions avoid
misunderstanding.
• Avoid leading and biased questions.
• Give concise but not complete directions in the questionnaire.
• Use scaled questions rather than simple yes/no questions.
3.INTERPRETING AND REPORTING THE INFORMATION

• Data organized and interpreted is information.


• Tables, charts, graphs
• Descriptive statistics—mean, mode, median
• Market research subject areas:
• Sales
• Distribution
• Markets
• Advertising
• Products

© 2012 CENGAGE LEARNING. ALL RIGHTS RESERVED.


4.AVOIDING INHIBITORS TO MARKET RESEARCH

• Mistaken beliefs that inhibit the use of marketing research:


• Cost: research is too expensive.
• Complexity: research techniques rely on overly complex sampling, surveying,
and statistical analysis.
• Strategic Decisions: only major strategic decisions need to be supported
through marketing research.
• Irrelevancy: research data will contain either information that merely
supports what is already known or irrelevant information.

© 2012 CENGAGE LEARNING. ALL RIGHTS RESERVED.


5.INTERNET MARKETING
• The Internet:
• Allows the firm to increase its presence and brand equity in the marketplace.
• Allows the company to cultivate new customers.
• Can improve customer service and lower costs by allowing customers to serve
themselves.
• Provides a mechanism for information sharing and collection at a fraction of prior
costs.
• Is a direct-sales distribution channel where the seller-buyer relationship is
immediate, and the waiting period that follows a traditional marketing campaign is
almost eliminated.
6. DEVELOPING THE MARKETING CONCEPT
• Marketing Philosophies
• Production-driven philosophy
• Sales-driven philosophy
• Consumer-driven philosophy
• Factors in Choosing a Marketing Philosophy
• Competitive pressure
• Entrepreneur’s background
• Short-term focus
• Market Segmentation
• The process of identifying a specific set of characteristics that differentiate one group of consumers from the
rest.
• Demographic variables
• Age, marital status, sex, occupation, income, location
• Benefit variables
• Convenience, cost, style, trends (depending on the nature of the particular new venture)
7.CONSUMER BEHAVIOR
• Consumer Behavior
• The types and patterns of consumer characteristics.
• Personal characteristics
• Psychological characteristics

• Major Consumer Classifications:


1. Convenience goods?
2. Shopping goods (Homogeneous and heterogeneous)?
3. Specialty goods?
4. Unsought goods?
5. New products?
8.DEVELOPING A MARKETING PLAN
• Marketing Planning
• The process of determining a clear, comprehensive approach to the creation
of customers.
• Elements of Marketing Planning
• Current marketing research
• Current sales analysis
• Marketing information system
• Sales forecasting
• Evaluation

© 2012 CENGAGE LEARNING. ALL RIGHTS


RESERVED.
DEVELOPING MARKETING PLANNING (CONT’D)

• Current Marketing Research


• The purpose of marketing research is to identify customers—target markets—and to
fulfill their desires.

• Areas of Market Research


• The company’s major strengths and weaknesses
• Market profile
• Current and best customers
• Potential customers
• Competition
• Outside factors
• Legal changes
© 2012 CENGAGE LEARNING. ALL RIGHTS RESERVED.
9.CURRENT SALES ANALYSIS

Sales Research Questions:


• Do salespeople call on their most qualified prospects on a proper priority and time-
allocation basis?
• Does the sales force contact decision makers?
• Are territories aligned according to sales potential and salespeople’s abilities?
• Are sales calls coordinated with other selling efforts, such as trade publication
advertising, trade shows, and direct mail?
• Do salespeople ask the right questions on sales calls? Do sales reports contain appropriate
information? Does the sales force understand potential customers’ needs?
• How does the growth or decline of a customer’s or a prospect’s business affect the
company’s own sales?
© 2012 CENGAGE LEARNING. ALL RIGHTS RESERVED.
10. MARKETING INFORMATION SYSTEM

****What is Marketing Information System (MIS)?:-It is a system which


compiles and organizes:-data relating to COST, REVENUE, and PROFIT
from the customer base for monitoring the STRATEGIES, DECISIONS, and
PROGRAMS concerned with marketing.
• Factors affecting MIS.
• Data reliability
• Data usefulness or understandability
• Reporting system timeliness
• Data relevancy
• System cost
© 2012 CENGAGE LEARNING. ALL RIGHTS RESERVED.
11.MARKET PLANNING

• Sales Forecasting
• The process of projecting future sales through historical
sales figures and the application of statistical techniques.
• Evaluation
• Evaluating marketing plan performance is important so
that flexibility and adjustment can be incorporated into
marketing planning.
THE MARKET PLAN: A STRUCTURED APPROACH

1. Appraise marketing strengths and weaknesses, emphasizing “competitive


edge” factors.
2. Develop marketing objectives, along with short- and intermediate-range
sales goals.
3. Develop product/service strategies.
4. Develop marketing strategies to achieve intermediate- and long-range sales
goals and long-term marketing objectives.
5. Determine a pricing structure.
12.PRICING STRATEGIES
The pricing decision and strategies get more determined by the value that a customer attaches
to the product than the cost of inputs. In highly competitive market conditions, a price war in
an industry can create havoc and may force many to quit the market. Example, Aviation
industry.

*****What are the three vital strategies in fixing prices?


1.Price Skimming? :(A new technology or product in the market for the first time-
examples:-mobile phones, DVD players, LED/HD TV, Flat TV

2.Penetration Pricing?:(Ideal for a competitive market, especially for new products-


Examples- New magazines).

3. Premium Pricing?:(Ideal incase no competitors in the market and the product provides
significant advantages to the customer because of the location, time, intense need. Examples?
PRICING STRATEGIES (CONT’D)
What are the Psychological factors affecting the pricing decision?
• The quality of a product is interpreted by customers according to the level of the item’s price.
• Customer groups shy away from purchasing a product where no printed price schedule is
available.
• Emphasis on the monthly cost of purchasing an expensive item results in greater sales than
an emphasis on total selling price.
• Buyers expect to pay even-numbered prices for prestigious items and odd-numbered prices
for commonly available goods.
• The greater the number of customer benefits the seller can convey about a product, the less
will be the price resistance.

© 2012 CENGAGE LEARNING. ALL RIGHTS RESERVED.


Project Work
1. “Nirma, the proverbial ‘Rags to Riches’ saga of Karsanbhai Patel, is a
classic example of the success of an Indian Entrepreneurship in the face
of stiff Competition”. Substantiate it in your own views?

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