marketing management - session 2

7/31/2019 Marketing Management - Session 2

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Marketing Management

Prof. Rubina DMello


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The Meaning of Marketing

Marketing is the performance of business

activities that directs the flow of goods andservices from producer to consumer or user

PRODUCER

Product

CONSUMER

Need

Marketing activities


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Political/

Legal

Economic

Technological

Global

DemographicSociocultural

Competitive

Environment

Industry

Environment

Components of the General Environment


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II. Social ForcesA. Definition includes changes in the

demographic characteristics and the

cultural values of a population.

B. Demographics Easily quantifiableways of describing a population: age,

income, occupation, gender.


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C. Demographic Changes1. Larger population around 300 million2. Older population

- Aging Baby Boom (born between 1946-1964)- Generation X (born between 1965-1976)- Generation Y (born between 1977-1994)

3. Increasingly diverse4. Later Marriage5. Lower Birthrates6. Population Shifts


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III. Economic ForcesA. Why must marketers gauge economic conditions?

B. Inflationary Economy an economy where pricesof goods and services are increasing.

C. Recessionary Economy an economy where thereis a decline in Gross Domestic Product for two ormore consecutive quarters.

D. Consumer Income

- Gross income total household income for one year- Disposable income gross income less taxes

- Discretionary income gross income less taxes and

expenditures on necessities


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Technological ForcesA. Definition refers to inventions or

innovations from applied science or

engineering researchB. Can lead to new product development

C. Can render old products obsolete

D. Ignoring technology often meansbeing bypassed by competition

E. Impact of e-commerce


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LG Plasma Screen TVWhat products might be replaced with this?


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V. Competitive Forces

A. Definition the alternative firms that could provide a product tosatisfy a specific markets needs.

B. Questions to ask: Who are our major competitors (direct and indirect)? What is the size, growth, profitability, and target market of key

competitors? What are competitors key strengths and weaknesses? What are their capabilities in terms of products, distribution,

promotion, and pricing?

C. Where to get the information: Look at what the company says about itself (sales literature,

advertisements, annual reports, trade shows, company website) Look at what others say about the company (customers, sales

force, research firms, business and trade publications)


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VI. Regulatory Forces Regulatory forces are concerned with

the restrictions that state and federal

laws place on business activities. Theyexist to:

ensure competition

protect consumers


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Regulatory Forces (cont.)A. Laws Protecting Competition

B. Laws Protecting Consumers

-Many laws relate to food, drug, and cosmetics- Concerned with labeling guidelines and product

safety


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Regulatory Forces (cont.)C. Product related legislation

Patent law gives inventors the right to exclude othersfrom making or selling products that infringe on their

patented invention for a limited period of time. Copyright law gives the author of a literary, dramatic,

musical or artistic work the exclusive right to print,perform, and copy the work.

Trademark lawA word, phrase, symbol, or design

used to identify an organizations product and set itapart from competition.


14/20Slide 3-49

Kleenex, Band-Aid, and Q-TipsIn danger of becoming generic trademarks?


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BuyersSuppliers

Substitute

products

Potential

entrants

Industry competitors

Rivalry among

existing firms

Threat of

new entrants

Bargaining power

of suppliers Bargaining powerof buyers

Threat of

substitutes

Porter's Five Forces Model

Source: Michael E. Porter Competitive Strategy: Techniques for Analyzing Industries and Competitors, (The Free Press, 1980)


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Porters Generic Strategy

Focus

Differentiation

Overall Cost Leadership


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BCG Matrix


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BCG Matrix for TATA Group

Stars Question marks

Cash cows Dogs

Relative market share LowHigh

Industrygrowthrate

High

Low

Automobile,

Tea,

chemicals

Power,

Steel

Oil & Gas

Technology, consultancy,

Engineering services

Composites

Information System

Communication


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SWOT Analysis

SW Internal Factors

Strength

Weakness

OT External Factors Opportunities

Threat


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SWOT Analysis for Tata Group

ExperiencesMicroenvironmentBusiness model

Resource and capabilitiesculture

Value chainDistribution

macroenvironment

ExportsNew ProductsNew Markets

Acquisition and Mergers

Free MarketLow Barriers

Globalisation of Economy

marketing management - session 2

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