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
MKT GROWTH
QUESTION MARKS
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, SELFEXPRESSIVE 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 Neighbors Acquaintances
Friends
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 Larger Buyers Close SupplierCustomer Relationship Geographically Concentrated Buyers Inelastic Demand
Derived Demand Professional Purchasing Multiple Buying Influences Direct Purchasing Reciprocity 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
P1
P2
P3 EXAMPLE: VOLKSWAGEN
M3
SELECTIVE SPECIALIZATION M1
M2
M3 STAR MOVIES
P1 P2 P3
STAR NEWS
STAR PLUS
PRODUCT SPECIALIZATION M1
M2
SCHOOL & RESEARCH AND DEV P1 COLLEGE SCIENCE LAB INSTITUTES
M3 INDUSTRY APPLICATION E.G. QC LABS
P2 P3 PRODUCT: MICROSCOPE
MARKET SPECIALIZATION M1
M2 MICROSCOPES
P1 TELESCOPES
P2 STETHOSCOPES
P3
M3
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 Simple Trend Analysis Correlation Methods Break-Even Analysis Executive Judgment
Sales Force Composite Surveys of Buyers Intention Market Tests Substitute Method Delphi Method
THE MARKETING-MIX
THE MARKETING-MIX (THE 4 Ps)
Product
Price
Promotion
Place
THE PRODUCT LIFE CYCLE (PLC) INTRODUCTION SALES
MATURITY
SALES CURVE DECLINE
GROWTH
PROFIT CURVE
TIME
PLC: INTRODUCTION STAGE STRATEGIES PROMOTION HIGH HIGH
LOW
RAPID SKIMMING
SLOW SKIMMING
RAPID PENETRATION
SLOW PENETRATION
PRICE LOW
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 PriceSensitive 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 HIGH PRODUCT QUALITY LOW
M
MEDIUM
1. PREMIUM PRICING
2. HIGH-VALUE STRATEGY
4. OVERCHARGING STRATEGY
5. MEDIUMVALUE
7. RIP-OFF STRATEGY
STRATEGY 8. FALSE ECONOMY STRATEGY
LOW 3. SUPER-VALUE STRATEGY 6. GOOD-VALUE STRATEGY 8. ECONOMY 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