marketing applications & practices

7/28/2019 Marketing Applications & Practices

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Marketing and its Applications

Dr. Tandon Kamal


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The Marketing Mix

C

Product

Price

Promotion

Place


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The Marketing Process

TargetConsumers

Product

Place Price

Promotion

Competitors

MarketingIntermediaries

PublicsSuppliers

Demographic-Economic

Environment

Technological-Natural

Environment

Political-Legal

Environment

Social-Cultural

Environment


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Marketing Strategy

Needed to create and retain a satisfiedcustomers

Strategies STDP Strategies Marketing Mix Strategies


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STPD Strategies

Segmentation Aggregating process A cluster of people with

similar needs. A Homogeneous group of customer who will

respond to a marketing mix in a similar way.

Targeting Once the market segment is defined, it has to

decide how many and which one to target.


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Differentiation Product Differentiation Service Differentiation Channel Differentiation Personnel differentiation

Positioning Its a perception about your offering in the minds

of the consumer.


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Product Mix Strategies

What is Product Mix Set of all products offered by an organisation to its

customers

Consists of Width Length

Depth Consistency


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Case Study

Product-lineLength

Product-Mix Width

Beverages Juice Snacks

PepsiMountain Dew

AquafinaMirinda7-Up

Dukes SodaDukes MangolaSlice

TropicanaOrangeNature Sweet

AppleGrape

PineappleTomatoMixed Fruit

LaysCheetosLeharNumkeensNutyumz

Kurkure

Product-Mix Width and Product-Line Length for PepsiCo India


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Strategy of Product Mix

Expansion of product mix Contraction of product mix

Altering existing products Positioning the product


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Place

Is concerned with all the decisions involved in the getting right product tothe target markets place.

Distribution Channels any series of firms that participatein the flow of products from producer to its final consumers.

Manufactures or producer

Consumer

Nestle

Wholesaler

Wholesaler

Retailer

Wholesaler

Retailer

Toyota

Retailer

Raymond's


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Promotion Mix Strategy

Push Strategy directing communications to channel

members Pull Strategy

directing communications to end users

Factors type of product/market buyer readiness stage product life-cycle stage


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What is Business Plan?

The business plan is a written document prepared bythe entrepreneur that describes all the relevantinternal and external elements and strategies for

starting a new venture. It is a integration of functional plans such as

marketing, finance, manufacturing, sales and humanresources.


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Outline of a Business Plan

Introductory Page Name and address of business Name(s) and address(es) of principal(s) Nature of business Statement of financing needed Statement of confidentially of report


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Outline

Executive Summary Three to four pagessummarizing the complete business plan

What is the business concept or model?

How is this business concept or model unique? Who are the individuals starting this business? How will they make money and how much?


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Outline Environmental and Industry Analysis

Future outlook and trends Analysis of competitors Market segmentation Industry and market forecasts

Description of Venture Product(s) Service(s) Size of business Office equipment and personnel Background of entrepreneurs


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Outline Production Plan

Manufacturing process (amount subcontracted) Physical plant Machinery and equipment Names of suppliers of raw materials

Operational Plan Description of companys operations Flow of orders for goods and/or services

Technology utilization


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Outline Marketing Plan

Pricing Distribution Promotion Product forecasts

Controls Organizational Plan Form of ownership Identification of partners or principal shareholders Authority of principals Management-team background

Roles and responsibilities of members of organization


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Outline Assessment of Risk

Evaluate weakness of business New technologies Contingency Plans

Financial Plan Pro forma income statement Cash flow projections Pro forma balance sheet Break-even analysis Sources and applications of funds


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Outline

Appendix (contains backup material) Letters Market research data Leases or contracts Price lists from suppliers.


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Using and Implementing TheBusiness Plan

The busi ness plan is designed to guide theentrepreneur through the first year of operations.

Implementation of the strategy contain control pointto ascertain progress and to initiate contingency planif necessary.

Business plan not end up in a drawer somewhereonce the financing has been attained and thebusiness launched.


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Measuring Plan Progress Entrepreneur should check the profit and loss statement, cash

flow projections, and information on inventory, production,quality, sales, collection of accounts receivable, anddisbursements for the previous month.

Inventory control Production control Quality control Sales control Disbursements


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Updating the Plan The most effective business plan can become out-of-

date if condition change. If the change are likely to affect the business plan,

the entrepreneur should determine what revisionsare needed.

In this manner, the entrepreneur can maintainreasonable targets and goals and keep the newventure on a course that will increase probability of

success.


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BUSINESS MARKETING

IS MARKETING OF GOODS AND SERVICES TO:

Companies Government Bodies Institutions (i.e. hospitals) Non-Profit Organizations (i.e. American Red Cross)

FOR

USE IN PRODUCING THEIR PRODUCTS AND/OR TOFACILITATE THEIR OPERATIONS


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B2B: goods or services are sold for any useother than personal consumption

Note: It is not the nature of the product ;it is the reason for the transaction .

What Distinguishes B2B from B2C?


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You buy a gear to fix your mountain bike.Ford buys the same gear to fix a machine.Xerox buys soft drinks for its cafeterias.You start a landscaping business andpurchase a lawnmower.

The U.S. government buysanything.

Is it a B2C or a B2B Transaction?

B2B B2C M k ti


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B2B versus B2C MarketingCharacteristic B2B Market B2C Market

Sales volume Greater Smaller

Purchase volume Greater Smaller

Number of buyers Fewer Many

Size of individual buyers Larger Smaller

Location of buyers Concentrated Diffuse

Buyer-seller relationship Closer More Impersonal

Nature of channel More direct Less direct

Buying influences Multiple Single/Multiple

Type of negotiations More complex Simpler

Use of reciprocity Yes No

Use of leasing Greater Less

Key promotion method Personal Selling Advertising

BUSINESS TO BUSINESS


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BUSINESS TO BUSINESS:IT IS ALL ABOUT DEMAND

DERIVED DEMAND The demand for a companys products comes from

(derived) the demand for their customers products. Most demand comes from consumers.

JOINT DEMAND Two products are used together and demanded

together Both products are consumed at the sametime


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Major Uses of B2B Products

For additional production (e.g.,components are combined intosubassemblies and become part of

the finished product)For use in operations , but not partof the finished productFor resale


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Classifying Business Goods & Services

3 Main Categories of ProductsEntering Goods

Become part of the finished product

Cost assigned to the manufacturing process

Foundation GoodsCapital ItemsTypically depreciated over time

Facilitating ProductsSupport organizational operationsHandled as overhead expenses


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Entering GoodsRaw Materials

Farm products & natural products

Only processed as necessary for handling & transport

Require extensive processingManufactured Materials & Parts

Any product that has undergone extensive processing prior topurchase

Component Materials require additional processingComponent Parts generally do not require additional processing


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Foundation GoodsInstallations

Major long-term investment items

Buildings, land, fixed equipment, etc.Accessory Equipment

Less expensive & short-livedNot considered part of fixed plant

Portable tools, PCs, etc.


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Facilitating ProductsSupplies

Any supplies necessary to maintain the

organizations operations Services

Maintenance & Repair support

Advisory supportLogistical support


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Categories of B2B Customers

Commercial enterprises Indirect channel members and facilitators OEMs (original equipment manufacturers) Users = customers

Governmental organizations Institutions


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What is FMCG

Fast-moving consumer goods (FMCG) orconsumer packaged goods (CPG) are products thatare sold quickly and at relatively low cost. Examples

include non-durable goods such as soft drinks,toiletries, and grocery items. [Though the absoluteprofit made on FMCG products is relatively small,they generally sell in large quantities, so thecumulative profit on such products can besubstantial.


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Brand equity

How strong is your br and? Is it a brand with manyloyal buyers that people know and trust and arewilling to pay a price premium for? Or is it a weakbrand, commanding little loyalty and esteem? In

sum, is your brand equity high or low? Strong brandsenter the recession in a much more favourableposition than weak brands. They are on the shelvesof more retailers, have more shelf space and have alarger and more committed customer base.Marketing budgets for stronger brands also tend tobe higher.


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Marketing strategies for fast -movingconsumer goods

Four scenarios

1> Brand Equity (High), Reduction in brandinvestments.

2> Brand Equity (High), No reduction/increase inbrand investments. 3> Brand Equity (Low), Reduction in brandinvestments. 4> Brand Equity (Low), No reduction/increase inbrand investments.


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Consumer Durables Marketing

Introduction

A Durable good or a hard good is a good which does

not quickly wear out.More specifically, it yields services or utility over time

rather than being completely used up when usedonce. These products are hard goods that cannot be

used up at once.


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What is services?

It is the part of the product or the fullproduct for which the customer is

willing to see value and pay for it.


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Growing Importance of Services

Economic well being increases the demand of services

Changing lifestyle Complexity of the product


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Characteristics of Services Intangibility Perishability Inseparability

Variability Client relationships Right of owner-ship


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Intangibility

Hard to grasp, concept is abstract

Dramatization often necessary for concept

Hard to separate the service provider and the service


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Perishability

Services cannot be stored or held in inventory.

If not used when available, they go to waste.


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Inseparability Outlet accessibility can limit the area covered

by the service.

Image is important: Image affects the perception of the service.


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Variability

Service quality tends to vary considerably.

Haircut from your hair dresser vs. Javed Habib


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Client Relationships

Relationships between service organizations and customers are often close

Potential for loyalty long term


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Right of owner -ship It is not taken to the service, we merely

experience it. e.g. Services of a doctor, lawyer, teacher,

mechanic, etc..

Difference bet een ph sical


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Difference between physicalgoods and services

Physical goods Services

tangible intangible

homogeneous heterogeneous

Production and distribution areseparated from consumption

Production, distribution andconsumption are simultaneousprocesses

A thing An activity or process

Core value processed in factory Core value produced in the buyer-seller interaction

Customers do not participate inthe production process

Customers participate inproduction

Can be kept in stock Cannot be kept in stock

Transfer of ownership No transfer of ownership


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Ch ll i B di d


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Challenges in Branding anddecisions

Branding to be or not to be..

Whether Produce Manufacturer Brands or

Distributor / Private BrandsWhich Brand Name/s to use

Whether to use Line extensions, Brand

Extensions, Multi Brands, New Brands or Cobrands


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Brand Name Features

suggest something about the products benefits

suggest the product or service category suggest concrete, high imagery qualities be easy to spell, pronounce, recognize, and

remember

be distinctive not carry poor meanings in other countries and

languages

A Brand name should


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Packaging

What is packaging Packaging Industry

Used materials : Metals, plastics, wood, paper, glass, laminates, polysters, etc.

Functions of packaging Protection, Appeal Performance Offer convenience to the end-users Cost effective

Legal dimensions of packaging Statutory requirements Net weight, when packed Date of manufacture Date of expiry Directions of storage MRP Directions for use


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Personal Selling

Role of personal Selling Types of selling jobs

Merchandise deliveries Inside order-taker Outside order-taker Missionary salesperson Sales engineer Tangible product seller Intangible product seller

The selling process Preparation Prospecting Preapproach Approach Sales presentation Handling objectives Closing the sale Post-sale follow-up


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What is sales promotion?

Sales promotion consists of a diverse collectionof incentive tools, mostly short term, designedto stimulate quicker and or greater purchase of

particular products/services by consumers ortrade

-Kotler

Below the line


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Non personal promotional effort that aredesigned to have immediate impact on sales

Employed for a pre-determined limited periodto increase consumer demand or stimulatemarket demand



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Sales promotion offers an incentive to buy Encompasses everything that is outside of

advertising, PR and DM Uses advertising, PR and DM to deliver the sales

promotion Can be planned to increase sales over a long period

and not necessarily about immediate results(privilege / mileage points)


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Why has SP grown so much?

Results ! - immediate / quick boost to sales Results over finite period of time - v/s

advertising or PR Results are measurable Easy and inexpensive to implement

Costs & efficiency of mass media /advertising has risen considerably


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.

Product managers face pressure to increasesales

Companies face more competition Consumers have become more deal oriented

Sales Promotions work!


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How does SP work?

Consumer decision making process (except for low cost,low involvement impulse pur.) - Awareness

- Information gathering- Pre purchase evaluation- decision

- PURCHASE- Post purchase evaluation


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- Awareness- Information gathering- Pre purchase evaluation- Decision- PURCHASE

- Post purchase evaluation

Advt / PR

Per Sell

SP


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SP works because ...

It alters the price / value relationship that theproduct offers the buyer

Lowers price - use of coupons, discounts

Add value - value packs, extra free Everybody loves freebies Consumers have a reason to purchase the

product NOW Justifies post purchase evaluation


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Advantages

Sales promotions help shape buying patterns -Annual sales

Attract new audiences - trials for new products Increase sales - freebies, buy 1 get 1 free Increases profits Helps move stock / liquidate inventory

Increases awareness - reach new buyers


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Advantages

Encourages the consumer to buy more than usual ona single shopping visit

Reminder of product, especially when a new product

/ competitor is about to launch Improving TOM recall of the brand if promo is

advertised in mass media Demoralise newly launched brands


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Disadvantages

Can seem like last minute panic measures andthat can signal failure

Can give an impression of hard sell Greed for sales - promos are often not related to

the strategic elements of the brands mktg. mix Often viewed as simple reactionary techniques to

increase sales and profits Dilutes brand value - discount brands


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Sales promotion techniques

Price deals Discounts Price pack deals Samples Rebates Sweepstakes/contests

Frequency rewards Demos POP

Trade allowances Dealer loader Trade contests POP Displays Training programs Push money / Spiffs Exhibitions


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Samsung pinning toh winning

All India promo Aggressive use of mass media Consumer gets an assured gift on purchase of

any Samsung product 100 cr worth of prizes on offer Sms 16 digit pin and the gift u get wl b smsd 2

u.

Cash in on Diwali purchases


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Phod ke dekho offer

Consumer promotion scheme Packaged as a coconut which cons picks on

purchase of a Samsung product Breaking the coconut reveals a chance to win

a gift Strong consumer acceptance helped co to

achieve a growth of 35% in sales over last year- same period


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Test drive and win

Tata Motors celebrated 50 years Offer to test drive any Tata car - fill a form -

and lucky winners could win Prize Indica V2 Petrol Buzz / Hype / Awareness

Mass media - TV / Press / DM Helped build / gather data base

Buzz around Petrol

Developing a Sales Promotion and


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Developing a Sales Promotion andMerchandising Plan

Set sales promotion and merchandising objectives. What is your target audience? Establish a tentative sales promotion and

merchandising budget. Select sales promotion and merchandisingtechniques.

Developing a Sales Promotion and


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Select media for distributing promotions. Decide on timing of sales promotions andmerchandising.

Pretest sales promotions and merchandising. Prepare final sales promotion and merchandisingplan and budget. Measure and evaluate sales promotion andmerchandising success.

Developing a Sales Promotion andMerchandising Plan


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10 commandments of sales promos

Creativity

Knowyour target

Specificobjectives

Know

Basictechniques

Simplicity

AttngrabbingvisualsBe clear

Reinforceadvertising

Support brandimage

Coordinatewith mktg

Knowwhen to break


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Cyber Marketing

What is cyber marketing Cyber marketing and conventional marketing

Interconnectivity Interactivity Involvement

Information Individualisation integrity

Cyber marketing model The nature of cyber marketing

Customer profiling, segmentation and targeting Product planning Branding Pricing decision Advertising and sales promotion Distribution Marketing research


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Limitations of cyber marketing Limits of digitisation

Shopping experience Security issues Internet access density

Customers used to freebies Dot.com bust

Attracting traffic to the internet site


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What is internet ??

Global network of interconnected networks.

Includes millions of corporate, government,organizational and private networks.

Types of network forming internet

IntranetExtranet

Web


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What is E - Marketing

Process of growing & promoting an organization usingonline media

Ties creative and technical aspects of internet.

Creating, communicating and delivering value tocustomers.

Managing customer relationship.


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Objectives of Internet Marketing

Create Awareness. Generate Interest. Disseminate Information. Create an Image. Create a Strong Brand.

Characteristics of Internet


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Characteristics of Internetmarketing

Relatively Inexp ensive. Wide reach. Allows research, purchase of products

and services on convenience. Quick Response.


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Limitations of E - Marketing

Dependant on technology. Rigid mindset. Virtual aspect. Security Concern. Maintenance Cost.

Global competition.


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7 Dimensions to Consider

Personalization. Privacy. Customer Service. Community. Site.

Security. Sales Promotion.


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Methods of Internet Marketing Search engine marketing. Display Marketing E-mail Marketing, Affiliate Marketing Interactive Marketing

Blog Marketing. Viral Marketing

Last Message


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Last Message

Must remember that we all are human beings and dealingwith human beings,

We can smile, animals cant, show the world that we are

human beings by wearing smile all the times.Dr. Tandon Kamal

God Bless u all !

IN GOD WE TRUST

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