Sales Management

MARKETING
MARKETING is a process of transferring a
product or service to a buyer at a competitive
price in order to satisfy his or her need
 Marketing is a social and managerial process
by which individuals and groups obtain what
they need and want through creating and
exchanging products and value with others.
Marketing impacts the sales revenue of any
enterprise
 Markets
The set of all actual and potential buyers of a
product or service

Communication

Products / Services
Industry Market (a
(a collection collection of
of sellers) buyers)
Money

Information

A simple marketing system

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 Marketing Management
The analysis, planning, implementation, and
control of programs designed to create, build,
and maintain beneficial exchanges with target
buyers for the purpose of achieving
organizational objectives.

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 Marketing Concepts
Definition

Marketing concepts can be defined as the

marketing philosophies by which a firms goal
can be best achieved through identification
and satisfaction of the customers stated and
unstated needs and wants.
Meaning

Companies adopt different philosophies in relation to

marketing of their products. Some claim that they are
customer oriented and others say that they offer value to
their customers. Still others say that they treat their
customers as kings. These philosophies in relation to
marketing are known as marketing concepts.
 Types of Marketing Concepts
Traditional Concepts
Exchange Concept: The Exchange concept holds that
the exchange of a product between the seller and the
buyer is the central idea of marketing.
Production Concept: The production concept holds
that the consumer prefer the goods which are easily
available at lower prices. Therefore, it is necessary to
produce in large quantities at lower costs.
Product Concept: It is a belief of the
management that consumers favour the products
of superior quality, better performance and
innovative features. Therefore, successful
marketing requires continuous product planning
and development and improvement in quality
standards.
 Selling Concept :The idea that consumers will
not buy enough of the organizations products
unless the organization undertakes a large
scale selling and promotion effort.
 Modern Concepts
Marketing Concept: This is the modern concept of marketing
or marketing philosophy.

This concept holds that the primary task of a business firm is

to study the needs, desires and the preferences of the potential
consumers and produce goods which are actually needed by
the consumers.

When an organisation practices the marketing concept, all its

activities are directed to satisfy the consumer.
 Social Concepts: According to this concept, the task
of management is to identify and satisfy consumer
wants, in conformity with social interests.

Firms should not only consider consumer wants and

profits but also society interests while making their
marketing decision.
 Holistic Marketing Concept: Holistic marketing concept is a
new marketing concept. Holistic marketing recognizes that
everything matters with marketing- and that a broad,
integrated perspective is often necessary. There are four
components of holistic marketing concept. They are

Relationship marketing

Integrated marketing

Internal marketing

Social responsibility marketing

 Functions of marketing
Marketing and sales are critically important to
profit seeking companies because they strive
to ensure satisfaction in the exchange of
values between the products and consumers
of products and services.
ertising &promotion)
Marketing Interaction
tion
 SELLING CONCEPT
Vs
MARKETING CONCEPT
SELLING CONCEPT MARKETING CONCEPT
Inward focus on business. Outward focus on customer.

Define business by goods Define business by benefits

and services
for customer
For everybody or the
average consumer. specific group of customer

Profitability through sales Profitability through customer

volume satisfaction.

Less favorable in a More favorable in a

competitive environment. competitive environment.
 How the companies think?

SELLING CONCEPT MARKETING CONCEPT

Converting product into cash. Converting customers need into

Emphasis of sale of the product product.
already used. Emphasis on product planning
and development.
Fragmented approach to selling. Integrated approach to
marketing.
Buyer beware principle followed. Seller beware principal followed.
Cost determine price. Customer determine price , price
determine cost.
 HOW THE COMPANIES ACT
SELLING CONCEPT MARKETING CONCEPT

Focus on sellers needs Focus on customer needs

Holds customer and Holds customer and

business. business.

Manufactures the product Identifies the customer

first. first.

Sales volume or`iented Customer satisfaction

with profit oriented.
HOW THE COMPANIES PERFORM?
SELLING CONCEPT
MARKETING CONCEPT

Product supreme. Customer supreme.

Profit through sales volume Profits through customer

Planning is short term satisfaction.

oriented Planning is long term

Aims at customer oriented.

satisfaction with companies Aims at customers as profit

profit. targets.
 The selling and Marketing Concepts Contrasted

Starting point Focus Means Ends

Factory Existing products Selling Profits through sales volume

and promoting

The selling concept

Profits through customer

Market Customer needs Integrated marketing satisfaction

The marketing concept

 MARKET MIX
Marketing mix refers to those four elements
(product, price, promotion, and place) of a firms
marketing strategy which are designed to meet the
needs of customers.

These are often known as the four Ps.

 The Marketing Mix:
The 4 Ps of Marketing

Place

The
Product Marketing Price
Mix

Promoti
on
Product:
Products must be ensured to meet the needs of
customers in terms of the following aspects:
1. Appearance
2. Function
3. Cost
 Marketing Mix: Product
Aspects Brief explanations or examples

The appearance
Color, size, shape, etc. must meet the consumer
needs.
The function
Able to be used
Convenient for use
Meeting special needs of customers
The cost
Production costs must be low enough to earn
some profit.
High cost, higher price.
Too high price, customers unlikely to buy.
Price:

The pricing policy that a business chooses is often a

reflection of the market at which it is aiming.

The right price set must take into account of

production costs, competitors prices and consumers
purchase ability and demand level.
 Marketing Mix: Price
Factors Influences on the price of a product

High production costs

High production costs would mean the high sale price
for the goods supplied by sellers.

High customer demand

High customer demand will lead to the increased
price of the goods or services. Suppliers are more
wiling to provide the goods or services as it is
more profitable for them to supply.

Low prices charged by

If the price of the substitute product offered by
competitors
competitors decreases, the demand for a product
will be decreased as well.
 Marketing Mix: Place

Definition:
Place refers to the means by which products can be distributed to
the consumers. The product must get to the right place at the
right time.
Decision making may be based on the following:
1. How the product is distributed physically, such as air, sea, rail,
or road.
2. How the product is sold, such as through retailers, wholesalers,
or direct mailing, etc.
 Marketing Mix: Promotion
Definition: Promotion refers to a number of promotional methods,
such as advertising, sales promotion, competitions, and personal
selling, etc.
A business must choose a method of promotion which is the most
effective in its particular market and for its own product.
For example, TV advertising may be better for the product with a
high sales turnover or a wide appeal. But for high-technology
machines or equipment, it is better to choose personal selling
methods.
 Product Life Cycle

Definition: Products pass through several stages of

development in its life from introduction to decline:

Stages of product life cycle usually include:

1.Development

2.Introduction

3.growth

4.Maturity

5.Saturation

6.Decline
 Product Life Cycle

The stages of the product life cycle:

Development Introduction Growth Maturity Saturation Decline

 Development
The product is being designed.
Suitable ideas are tested.
Decision is to be made whether or not to produce the
product.
If OK, the business begins to produce.
 Introduction
The product is new in the market.
Promotion is needed to increase the sales and make it
aware widely.
Product is still not profitable
Public awareness is very important to the success of a
product. If people don't know about the product they
won't go out and buy it.
 There are two different strategies you can use to
introduce your product to consumers:

Penetration

Skimming
 Introduction Stage
Penetration
This strategy usually set the product price very high
initially and then gradually lowers it over time.
This is a good strategy to use if there are few competitors
for your product.
Profits are high with this strategy but there is also a great
deal of risk. If people don't want to pay high prices you
may lose out.
 Introduction Stage
Skimming
In this case you set your prices very low at the
beginning and then gradually
increase them.
This is a good strategy to use if there are a lot of
competitors who control a large portion of the market.
Profits are not a concern under this strategy. The most
important thing is to get you product known and worry
about making money at a later time.
 Growth

The Growth stage is where your product starts to grow.

In this stage a very large amount of money is spent on

advertising.
You want to concentrate of telling the consumer how
much better your product is than your competitors'
products.
What are the ways in which you could prompt a product?
 Growth
The product is established in the market.
Sales begin to grow rapidly.
The product becomes very profitable.
The business needs to seek new opportunities and
enlarge the market.

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 Maturity

The third stage in the Product Life Cycle is the

maturity stage. If your product completes the
Introduction and Growth stages then it will then
spend a great deal of time in the Maturity stage.

During this stage sales grow at a very fast rate

and then gradually begin to stabilise.

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The product has a stable market share.
The growth levels off in the sales.
Sales have reached the top.
Competitors have entered the market.
The business needs to consider new product
development or innovate the product.
 Saturation
Too many competitors have entered the market.
Some businesses are forced out of their business.
Businesses have to develop some extension strategies to
extend their product life cycle.
For example, find new uses of the product; finding new
markets for the product; changing components of the
products, etc.
 Decline
This is the stage in which sales of your product begin to fall.
Either everyone that wants to has bought your product or new,
more innovative products have been created that replace yours.

Many companies decide to withdrawal their products from the

market due to the downturn.
The only way to increase sales during this period is to cut your
costs reduce your spending.
 THE MARKETING ENVIRONMENT
The forces that directly and indirectly influence an
organizations capability to undertake its business.

The trading forces operating in a market place over

which a business has no direct control ,but which
shape the manner in which the business function and
is able to satisfy its customers.
COMPONENTS OF MARKETING ENVIRONMENT
Internal environment : Forces and actions inside the firm that
affect the marketing operation composed of internal stake
holders and the other functional areas within the business
organization.

External environment
Macro environment
Micro environment
 MICRO ENVIRONMENT

The factors in the immediate environment .

MACRO ENVIRONMENT

Broad forces which shape the character of opportunities

and threats.
 THE INTERNAL ENVIRONMENT

All factors that are internal to the organization are known

as the 'internal environment'.
They are generally audited by applying the 'Five Ms'
which are Men, Money, Machinery, Materials and
Markets.
The internal environment is as important for managing
change as the external. As marketers we call the process
of managing internal change 'internal marketing.
 THE INTERNAL ENVIRONMENT

. It includes the following:

The human resource department.

The operations department.

The accounting and finance department

The research and development department.
 Micro environment
The forces close to the company that affects its ability to serve.
It comprises all those organizations and individuals who directly
affect the activities of a company.
All factors which impact directly on a firm and its activities in
relation to a particular market.
1. Suppliers
2. The market channel
3. Customers.
4. Competitors
5. Public
 SUPPLIERS
Suppliers are either individuals or business houses.

.They provide resources needed by the company .

.The developments in the suppliers environment have a
substantial impact on the marketing operations of the company
.Companies can lower their supply costs and increase product
quality to gain competitive advantage in the market.
.supply shortages have to be fully monitored and plans should
be made to avoid it.
 Market intermediates

They are either business houses or individuals

They help the company in promoting, selling and

distributing the goods to customers.

They are middlemen, distributing agencies, market

service agencies and financial institutions.
 Customers

The target market of the company is usually of five types:

1.Consumer market i.e. individual and householders

2.Industrial market i.e. organizations buying for producing

other and services.

3.Reseller market i.e. organizations buying goods and

services with a view to sell them to others.
4.Government and other non profit markets. i.e.those
buying goods and services in order to produce public
services.
5.International market i.e. individuals and organizations
of nations other then home land who buy for either
consumption or industrial use.
 Competitors

No company stands alone in serving and satisfying

the needs of a customer market. It faces competition.

This helps the company in facing a host of

competitors with confidence .

The company in order to come out successfully has to

adopt means which may help it to outmaneuver.
The competitive environment consists of certain basic
things which every marketing manager has to take note
of.
Philip Kotler the best way for a company to grasp the
full range of its competition is to take view point of a
buyer.
 Public
Public is defined as any group that has an actual or
potential interest in or impact on a companys ability
to achieve its objective.

The actions of the company do affect the interest of

other groups i.e., those who form general public for
the company who must be satisfied along with the
consumers of the company.
According to Kotler companies must put their primary
energy into effectively managing their relationships with
their customers.
 Macro environment
Macro environment refers to those factors which are
external to companys activities and do not concern
the immediate environment.

It comprises general forces that affect all business

activities in market .
Factors affecting Macro environment
1. POLITICAL FORCES

1. ECONOMIC FORCES

1. SOCIAL AND CULTURAL

FORCES

1. NATURAL FORCES

1. TECHNOLOGICAL FORCES

1. DEMOGRAPHIC FORCES
 Political and Legal forces
Includes laws, government agencies and pressure groups that
influence or limit various organizations and individuals in a
given society.

Increasing legislation.

Changing government agency enforcement.

More emphasis on ethics and socially responsible actions.

 Economic environment
The economic environment consists of factors that affect
consumers purchasing and spending power.

Under economic environment manager generally studies

1.trends of gross national product

2.patterns of real growth in income

3.variations in geographical income distribution.

4.borrowing pattern ,trends and governmental and legal

restrictions.

5.major economic variables

 Social and cultural forces

Social responsibility has crept into the marketing

literature as an alternative to the market concept.

Socially responsible marketing is that business firms

should take the lead in eliminating socially harmful
products
 DEMOGRAPHIC FORCES

Demographic data helps in preparing geographical

marketing plans, household marketing plans, age and
sex wise plans.
It influences behavior of consumers which in turn will
have direct impact on market place.
A marketer must communicate with consumers
anticipate problems ,respond to complaints and make
sure that the firm operates properly.
 Technological Environment
Most dramatic force now shaping our destiny.
Changes rapidly.
Creates new markets and opportunities
Challenge is to make practical, affordable products.
Safety regulations result in higher research costs and
longer time between conceptualization and introduction
of product.
 Natural Forces
Involves the natural resources that are needed as
inputs by marketers or that are affected by marketing
activities.