adv topic mrkting 9-2
TRANSCRIPT
8/3/2019 Adv Topic Mrkting 9-2
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IUNDERSTANDING MODERN
MARKETING
The Marketing Concept
Marketing Mix Model
Broadening Scope of Marketing
Marketing’s Role in the Organization
Creating Customer Value and Satisfaction
Relationship Marketing
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“The underlying philosophy of modern marketing management(since the 1960’s) is the outward
focus on customers as the “Center of the Universe”
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The Marketing Concept
Captured in terms such as: Customer orientation
Customer focused Customer driven
Customer centric
Customer satisfaction
Market driven
Exceed customerexpectations
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Marketing Concept
Key Characteristics
Focus on customers
Profits = f (customer satisfaction)
Supply adjusts to will of demand
Assumes intense competitive environment
Long-term time horizon
Normative not descriptive model
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Selling and MarketingConcepts Contrasted
Factory Existingproducts Selling andpromotion Profits throughsales volume
Targetmarket
Integratedmarketing
Profits throughcustomer
satisfaction
Customerneeds
Startingpoint Focus Means Ends
(b) The marketing concept
(a) The selling concept
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Problems in Implementingthe Marketing Concept
Inertia, entrenchment (old ways die hard) Projection of own beliefs and values
Confusion of MC with superficial PR
Learning about customer needs difficult to
operationalize Information lost in organizational maze
Calls for integrated organization to supportmarketing effort
Requires continuous monitoring
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Conclusion
Marketing concept ismore relevant than
ever as we enter the2nd decade of the 21st
century
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Operational Model for
Implementing thePhilosophy of the Marketing
Concept is the:
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The Marketing Mix Consists of Four Basic Strategic Variables
(the four “Ps”)
Product Strategy
Price Strategy Promotional Strategy
Place Strategy (Channels of
Distribution)
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The role of marketingmanagement is to mix or
blend these four strategicvariables in such a way as
to meet the needs of...
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THE TARGET MARKET
Target Market
Product Price Promotion Place
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This process does
not take place in a
vacuum
E i t
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Environment(Exogenous Variables)
Main Categories of Environmental Variables
Economic
Competitive
Technological
Socio-Cultural-Demographic
Legal-Political-Government
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Illustrative Representation
of the Marketing Mix
P l a c e
InternalControllable
Variables
(endogenous)
Product
P r i c e
PromotionTargetMarket
Environment•Economic•
Competitive•Socio-Cultural-Demographic•Legal-Political-Govt•Technology
Th M k i Mi M d l P
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Internal
ControllableVariables(endogenous) P
r o d u
c t
Price
P r o m o t i o n
TargetMarket
Environment•Economic•Competitive•Socio-Cultural-Demographic•Legal-Political-
Government•Technology
Place
The Marketing Mix Model PortraysMarketing Management as:
•Based on the marketing concept•Having a supply side anddemand side•Supply adapting to demand•Highly interactive•An open system•Requiring human direction
•Highly dynamic process•An extremely challenging managerial task•Universally applicable to
virtually any organization•Global in scope
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Marketing’s BroadenedScope
Manufacturers Retailers
Accounting
Law
Organizations
Non-profits Universities
Government
People (political
candidates) Countries
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Marketing as a StrategicComponent of the Organization
Marketing is elevated to a level
of strategic position in theorganization
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Marketing-ManagementInextricably Tied to Decisions
Involving:
Future direction of the organization
Markets to be served
Creation of competitive advantage
Long term organizational performance
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Therefore Strategic MarketingManagement Consists of at Least
Six Major Areas
1) Defining the organization’s business
2) Specifying the purpose of the organization
3) Identifying opportunities4) Formulating product/market strategies
5) Budgeting: financial, production, human resources
6) Monitoring, evaluating, and adapting
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Defining the Organization’sBusiness
Type of customers (markets) to be served
Needs of those customers Means by which organization will meet the needs
Competitive advantage (attainment and sustained)
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Production
Output and efficiency measures, e.g. output per
Man hour
Finance
ROI ROS
Profit
Cash Flow
Marketing
Sales Volume Margin
Market Share Customer Satisfaction
Specifying the Purpose of theOrganization
Aspirations of the organization andwhat it wishes to achieve ie.,
objectives and goals
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Identifying OrganizationalOpportunities
External (environmental) opportunitiesmatched with internal (organizational)
capabilities
What do we do best? (distinctive competency)
What must we do? (success requirements)
What might we do? (environmental opportunity)
Formulating Product/Market
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Formulating Product/MarketStrategies
MarketPenetration
MarketDevelopment
New Offering
Development
Diversification
EXISTING NEW
EXISTING
NEW
MARKETSOf f
ering
s
B dgeting Financial
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Budgeting, Financial,Production, and Human
Resources
Financial implications and allocations relevantto the marketing plan
Revenue, expense, and profit projections
Cost allocations made
M it i E l ti d
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Monitoring, Evaluating and Adapting Marketing Strategy
Marketing audit --comprehensive,systematic, independent, and periodic
examination of the organization’smarketing objectives and strategies to
identify problems and opportunities as wellas to recommend ways of improving
marketing performance
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Customer Value andSatisfaction
Input Customer Costs
Output Customer Benefits= = CV
Note: Costs defined broadlyBenefits (customer’s viewpoint)
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Customer Satisfaction
Customer’s perception of perceived
performance of offering relative to experience
Perceived performance below expectations = dissatisfied customer
Perceived performance meets expectations = satisfied customer
Perceived performance exceeds expectations = delighted customer
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Relationship Marketing
The development and maintenance of long-term, cost effective relationships
with customers in order to retain theirpreference
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Relationship Marketing Compared
to Transaction (Traditional)Marketing
Factor Transaction Marketing Relationship Marketing
Time orientation Short-term Long-term______________
Organizational goal Make sale Retain customers________
Customer service priority Relatively low Very high______________Customer contact Low to moderate Frequent_______________
Customer commitment Low High__________________
Seller-customer interaction Conflict manipulation Cooperation; trust________
Source of quality Mainly from production Company wide _______
Tools for Implementing
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Tools for ImplementingRelationship Marketing
Affinity programs
Frequent-buyer/user programs
Database marketingPartnerships (strategic alliances
Co-marketing and co-branding
EDI (electronic data interchange)
VMI (vender-managed inventory)
QR (quick response)
Life-time value of customer analysis
Social Networks