MARKETING MANAGEMENT

PRESENTED ON BEHALF OF:

SYMBIOSIS CENTRE FOR

DISTANCE LEARNING

BY: PROF. HIMMAT G. ADISARE

MARKETING
ENVIRONMENT & SYSTEM
MARKETING
ENVIRONMENT FACTORS
 ECONOMIC ENVIRONMENT
 COMPETITIVE ENVIRONMENT
 TECHNOLOGICAL ENVIRONMENT
 SOCIO-CULTURAL ENVIRONMENT
 POLITICO-LEGAL ENVIRONMENT
 DEMOGRAPHIC ENVIRONMENT
 NATURAL ENVIRONMENT
ECONOMIC ENVIRONMENT
 BUSINESS CYCLE:
 PROSPERITY
 RECESSION
 DEPRESSION
 RECOVERY

 INFLATION & DISINFLATION

 UNEMPLOYMENT
 HIGH INTEREST RATES
COMPETITIVE
ENVIRONMENT
 TYPES OF MARKET STRUCTURES:
 PURE COMPETITION
 MONOPOLISTIC COMPETITION
 OLIGOPOLY
 PURE MONOPOLY
 COMPETITIVE STRATEGIES:
 PRICE COMPETITION
 NON-PRICE COMPETITION
TECHNOLOGICAL
ENVIRONMENT
 ACCELERATING PACE OF
TECHNOLOGICAL CHANGE
 UNLIMITED INNOVATION,
RESEARCH & DEVELOPMENT
OPPORTUNITIES
 GOVERNMENT LEGISLATION &
REGULATION
SOCIO-CULTURAL
ENVIRONMENT
 PERSISTENCE OF CORE CULTURAL
VALUES:
 RELIGIOUS
 RACIAL
 TRADITIONAL ETC.
 CHANGES IN SECONDARY VALUES:
 MUSIC
 CLOTHES
 EATING HABITS ETC.
 POLITICO-LEGAL
ENVIRONMENT
 Legislation For Environment Protection

 Legislation For Protection Of Consumers

 Legislation For Protection Of Industries from each

other

 MRTP, FDA, PCBs ETC.

DEMOGRAPHIC
ENVIRONMENT
 POPULATION EXPLOSION
 SLOWDOWN IN BIRTHRATE
 CHANGING TRENDS IN HOUSEHOLDS
 CHANGING ETHNIC & RACIAL
POPULATIONS
 BETTER EDUCATED POPULATION
 SHIFT FROM MASS TO
MICROMARKETS
NATURAL ENVIRONMENT
 DEPLETION OF NATURAL
RESOURCES
 INCREASING COST OF ENERGY &
POWER
 EFFLUENTS & ENVIRONMENTAL
POLLUTION
 RENEWABLE & NON-RENEWABLE
RESOURCES
MARKET-ORIENTED
STRATEGIC PLANNING
 THE BCG MATRIX (ASSIGNING
RESOURCES TO SBUs)

 QUESTION MARKS
 STARS
 CASH COWS
 DOGS
 THE BCG MATRIX (CONTD)
RELATIVE MKT SHARE

25%
STARS QUESTION MARKS
MKT
GROWTH

10%
DOGS

0% CASH COWS
10x 1x 0.1x
THE BCG MARIX (CONTD)
 QUESTION MARKS: NEW BUSINESSES OF THE COMPANY IN
HIGH GROWTH-RATE MARKETS
 STARS: SUCCESSFUL Q-MARK BUSINESSES BECOME STARS
THAT GAIN MARKET SHARE AND GENERATE PROFITS FOR
THE COMPANY
 CASH COWS: STAR BUSINESSES THAT REMAIN
SUCCESSFUL. MARKET-GROWTH RATE SLOWS DOWN AS
COMPETITORS ENTER THE SEGMENT, BUT CASH COWS
CONTINUE TO GENERATE STEADY PROFITS. THESE
PROFITS IN TURN ARE USED TO SUSTAIN STAR BUSINESSES
AND FUND NEW QUESTION MARK BUSINESSES
 DOGS: THESE ARE BUSINESSES IN DECLINE AND
THE COMPANY HAS THE OPTION TO “HARVEST”
OR “DIVEST”
ANALYZING CONSUMER
BEHAVIOR
ANALYZING CONSUMER
BEHAVIOR
 FACTORS INFLUENCING CONSUMER
BEHAVIOR

 BUYING ROLES

 TYPES OF BUYING BEHAVIOR

 THE BUYING DECISION PROCESS

FACTORS INFLUENCING
CONSUMER BEHAVIOR
 CULTURAL FACTORS:
 Culture
 Sub-culture
 Social Class
 SOCIAL FACTORS:
 REFERENCE GROUPS
 FAMILY
 ROLES & STATUSES
FACTORS INFLUENCING CONSUMER
BEHAVIOR(2)
 PERSONAL FACTORS

 Age and Life-Cycle Stage

 Occupation
 Economic Circumstances
 Lifestyle
 Personality & Self-concept
ANALYZING CONSUMER BEHAVIOR
(CONTD)
 PSYCHOLOGICAL FACTORS

 Motivation
 Learning
 Perception
 Beliefs & Attitudes
BUYING ROLES
 INITIATOR: THE FIRST PERSON TO
SUGGEST THE IDEA OF BUYING
 INFLUENCER: A PERSON WHOSE VIEWS
IMPACT THE BUYING DECISION
 DECIDER: THE PERSON WHO DECIDES ON
WHAT, WHEN & WHERE TO BUY THE
PRODUCT OR SERVICE
 BUYER: THE ACTUAL PURCHASER
 USER: THE PERSON WHO USES/CONSUMES
THE PRODUCT OR SERVICE
 TYPES OF BUYING
BEHAVIOR
 COMPLEX BUYING BEHAVIOR: HIGH
INVOLVEMENT, VERY EXPENSIVE,
INFREQUENTLY PURCHASED,VERY RISKY, SELF-
EXPRESSIVE PRODUCTS (DESIGNER JEWELLERY,
CUSTOM-DESIGNED SPORTS CARS, HOUSING)

 DISSONANCE REDUCING BUYING BEHAVIOR:

HIGH INVOLVEMENT, EXPENSIVE,
INFREQUENTLY PURCHASED, SELF-EXPRESSIVE
PRODUCTS (FURNITURE, WHITE GOODS, PCs)
TYPES OF BUYING
BEHAVIOR (CONTD)
 VARIETY SEEKING BUYING BEHAVIOR:
LOW INVOLVEMENT, FREQUENTLY
PURCHASED, INEXPENSIVE PRODUCTS
(PASTRIES, BISCUITS, SNACKS)
 HABITUAL BUYING BEHAVIOR: LOW
INVOLVEMENT, FREQUENTLY
PURCHASED, INEXPENSIVE PRODUCTS
(SUGAR, SALT, FLOUR, FOODGRAINS)
THE BUYING DECISION
PROCESS
 Problem/need Recognition

 Information Search

 Evaluation Of Alternatives

 Purchase Decision

 Postpurchase Behavior
PROBLEM/NEED RECOGNITION

 From Internal Stimuli:

 Hunger
 Thirst
 Fear

 From External Stimuli:

 Neighbor’s Purchases
 Advertisements
 Window Shopping
 Newspapers & Magazines
INFORMATION SEARCH

 From Personal Sources:

 Family
Family 
 Friends Friends
 Neighbors
 Acquaintances
INFORMATION SEARCH
(CONTD)
 From Commercial Sources
 Advertisements
 Dealers
 Salespersons
 Packaging
 Displays
INFORMATION SEARCH (CONTD)

 From Public Sources

 Mass Media

 Chambers of Commerce

 Consumer Rating Magazines

INFORMATION SEARCH (CONTD)

 From Experiential Sources

 Handling the Product

 Examining the Product

 Using the Product

EVALUATION OF ALTERNATIVES

 Successive Sets in Consumer

Decision-Making

 Total Set
 Awareness Set
 Consideration Set
 Choice Set
 Buying Decision
PURCHASE DECISION

 Interfering Factors
 Attitudes of Others: Opposing and
intense opinions of family members, close
friends and acquaintances
 Unanticipated situational factors:
Changes in income, job transfer, loss of
employment, change of priority e.g.
sudden payment of educational fees etc.
POSTPURCHASE BEHAVIOR

 Post purchase Satisfaction

 Keep the Product
 Store the Product
 Convert to a Second Use
 Post purchase Dissatisfaction
 Try to return the product/take legal recourse
 Rent it
 Get rid of it/Throw it
BUSINESS MARKETS VERSUS
CONSUMER MARKETS
 Business Markets
 Fewer Buyers  Derived Demand
 Larger Buyers
 Professional
Purchasing
 Close Supplier-  Multiple Buying
Customer Relationship Influences
 Geographically  Direct Purchasing
Concentrated Buyers  Reciprocity
 Inelastic Demand  Leasing
MARKET SEGMENTATION
MARKET SEGMENTATION

 Strategies for Identifying Target Markets

 The Mass Market Strategy

 The Segment Concentration Strategy

 The Multi-Segment Strategy

MARKET SEGMENTATION (CONTD)

 Strategies for Market Targeting (Contd)

 Single Segment Concentration
 Selective Specialization
 Product Specialization
 Market Specialization
 Full Market Coverage
SINGLE SEGMENT CONCENTRATION

M1 M2 M3

P1

P2

P3

EXAMPLE: VOLKSWAGEN
 SELECTIVE SPECIALIZATION
M1 M2 M3
STAR MOVIES
P1

STAR NEWS
P2

STAR PLUS
P3
 PRODUCT SPECIALIZATION
M1 M2 M3
SCHOOL & RESEARCH INDUSTRY
P1 COLLEGE AND DEV APPLICATION
SCIENCE LAB INSTITUTES E.G. QC LABS

P2

P3

PRODUCT: MICROSCOPE
 MARKET SPECIALIZATION
M1 M2 M3
MICROSCOPES
P1
TELESCOPES

P2
STETHOSCOPES
P3
 FULL MARKET COVERAGE
M1 M2 M3

P1

P2

P3

EXAMPLES: HLL, GODREJ, P&G, COKE

MARKET SEGMENTATION VARIABLES

 Geographic Segmentation

 Demographic Segmentation

 Psychographic Segmentation

 Behavioral Segmentation
SEGMENTATION VARIABLES (CONTD)

 Geographic Segmentation
 By Nations
 By Regions
 By States
 By Cities
 By Localities
SEGMENTATION VARIABLES (CONTD)

 Demographic Segmentation
 By Age
 By Gender
 By Income
 By Education Level
 By Religion/Race
 By Nationality
SEGMENTATION VARIABLES (CONTD)

 Psychographic Segmentation

 By Personality

 By Lifestyle

 By Social Class
SEGMENTATION VARIABLES (CONTD)

 Behavioral Segmentation

 By Usage Pattern
 By Occasion
 By Loyalty Factor
 By Attitude Towards The Product
SALES FORECASTING
SALES FORECASTING METHODS

 Time Series Analysis  Sales Force

 Simple Trend Composite
Analysis  Surveys of Buyers

 Correlation Methods Intention

 Break-Even Analysis  Market Tests

 Executive Judgment  Substitute Method

 Delphi Method
THE MARKETING-MIX
THE MARKETING-MIX (THE 4 Ps)

 Product

 Price

 Promotion

 Place
 THE PRODUCT LIFE CYCLE (PLC)
SALES
INTRO- CURVE
MATURITY
DUCTION
DECLINE
SALES
GROWTH

PROFIT
CURVE

TIME
 PLC: INTRODUCTION STAGE STRATEGIES

PROMOTION
HIGH LOW

HIGH
RAPID SKIMMING SLOW SKIMMING

PRICE

RAPID SLOW
LOW
PENETRATION PENETRATION
PLC: GROWTH STAGE STRATEGIES

 Style, Quality & Features Improvement

 Introduce New Models & Flanker Products
 Enter New Market Segments
 Enter New Marketing Channels
 Shift from Awareness to Preference
Advertising
 Bring Price Down to Next Level of Price-
Sensitive Customers
PLC: MATURITY STAGE STRATEGIES

 PRODUCT MODIFICATION

 MARKET MODIFICATION

 MARKETING-MIX MODIFICATION

(Please refer to Handout)

PLC: DECLINE STAGE STRATEGIES

 Increase the Investment Level

 Maintain the Current Status till market
Position Becomes Clear
 Disinvest from Unprofitable Businesses
 Harvest
 Divest
 PRICING STRATEGIES

PRICE

HIGH MEDIUM LOW

1. 2. 3.
HIGH PREMIUM HIGH-VALUE SUPER-VALUE
PRICING STRATEGY STRATEGY
4. OVER- 5. MEDIUM-
PRODUCT 6.
M CHARGING VALUE
QUALITY GOOD-VALUE
STRATEGY STRATEGY STRATEGY
8. FALSE
LOW 7. 8.
RIP-OFF ECONOMY ECONOMY
STRATEGY STRATEGY STRATEGY
SETTING PRICING POLICY

 1. Selecting the Pricing Objective

 2. Determining Demand
 3. Estimating Costs
 4. Analyzing Competitors’ Costs, Prices,
and Offers
 5. Selecting a Pricing Method
 6. Deciding on the Final Price
PHYSICAL DISTRIBUTION

 Importance of Physical Distribution

 Place Utility & Time Utility to Products

 Increase in Customer Base

 A Highly Promising Activity for Cost

Reduction
PHYSICAL DISTRIBUTION (CONTD)

 The FOUR major component functions:

 Designing the Physical Distribution System

 Transportation
 Warehousing
 Inventory Management
PHYSICAL DISTRIBUTION (CONTD)

 Designing the Physical Distribution System

 Analysis of What the Customers Want

 Analysis of What the Competitors are Doing
 Designing by Unit Specification and
Considerations
 Optimizing the Cost of the System
 Maintaining System Flexibility
PHYSICAL DISTRBUTION (CONTD)

 Transportation
 Assessment of Transportation Requirements
 Choosing the Right Transport Mode or Mix of
Transport Modes
 Routing of the Consignments
 Operational Planning
 Implementation
 Controlling Transportation Costs
PHYSICAL DISTRIBUTION (CONTD)

 Warehousing

 Role and Importance of Warehousing

 Designing the Warehousing System

 Improving Warehousing Effectiveness

PHYSICAL DISTRIBUTION (CONTD)

 Inventory Decisions

 Carrying Inventory is Inescapable

 Elements of Inventory Costs

 Issues in Inventory Management

THANK YOU ALL FOR
YOUR PARTICIPATION IN
THIS CONTACT
PROGRAMME