Marketing Management

Krishna Kishore SV
 Unit 1
Introduction to marketing
 What is Marketing?

Marketing is an organizational function

and a set of processes for creating,
communicating, and delivering value (Wowee)
to customers and for managing
customer relationships
in ways that benefit the
organization and its stakeholders. (Surface – MS?)
 What is Marketing Management?

Marketing management is the

art and science
of choosing target markets
and getting, keeping, and growing
customers through
creating, delivering, and communicating
superior customer value. (HMT, Khaithan Fans)
Eg: Xerox
Eg: Nirma Washing Powder, Stolen I phone Africa and China
The Scope of Marketing
 Core Concepts

• Needs, wants, and • Marketing channels

demands
• Supply chain
• Target markets,
positioning, • Competition
segmentation • Marketing
• Offerings and brands environment
• Value and • Marketing planning
satisfaction
Needs, Wants, and Demands

• Needs are the basic • Stated Needs (Customer wants an

inexpensive car)
human requirements
• Real Need (Customer wants a car
• Needs become wants whose operating cost, not its initial
when they are directed to price, is low)
specific objects that • Unstated Need (Customer expects
might satisfy the need. good service from the dealer)
• Delight Needs (Customer would like
• Demands are wants for the dealer to include an onboard
specific products backed navigation)
by ability to pay • Secret Needs (Customer wants
friends to see him as a savvy
consumer)
Segmentation, Target markets and Positioning

• The firm develops a market • Grameen Bank (Micro finance)

offering that it positions in the
minds of the target buyers as
delivering some central benefits • Mahindra Scorpio

• Volvo Cars
Offerings and Brands

• Intangible value proposition is • Boomer, Big Babol

made physical by an offering.
• A brand is an offering from a • Annapoorna Atta, Freedom
known source.

• Mountain Dew VS Sprite.

• For eg: McDonalds
Value and satisfaction

• Value reflects the sum of tangible and intangible

benefits and costs to customers. It’s a combination
of Q, S, P called customer value triad.
• Satisfaction reflects the person’s judgments of a
product’s perceived performance in relationship to
expectations

• Eg: Starbucks, Flipkart’s BBD, Sun DTH

Marketing channels

• Communication channels • Eg: ATL, BTL (FMCG,

• Distribution channels Pumps)
• Service channels • Eg: Intensive, Selective
(Motorola)
• Eg: Consumer
Electronics
Supply chain

• Vertical Acquisition. • Eg: CEAT

• Horizontal Acquisition • Eg: Myntra Jabong

Competition
• Potential rival offerings. • Apple Vs Samsung

• Product or service substitutes a • IOS Vs Android

buyer might consider
Company Orientations
Nike

Royal Enfield
Rolls Royce

Charging
cables, glass
wipers
Tata
Analysing the Marketing
Environment

Read Page Number 50 - 132

Macro Environment
o Technology environment (Eg: Home and Farm
Automation Trending)
o Socio-cultural environment (Techno
intoxification Eg: Whatsapp, MTS)
o Economic environment (Per Capita, and Rate
hikes)
o Political environment (Eg: China and Japan
dispute/Russia and Ukraine)
o Natural environment (Category 3 and 4 cyclones
have been normal presently, Fukushima, France
restarting Nuke plants)
o Demographic environment (South Korea Vs
India)
o Legal environment (business legislation on
plastic covers, Emission norms BS 4 to 6, rain
water harvesting)
o Government policies (Make in India, Promoting
entrepreneurship, women self employment)
Environment specific to the firm

• The market/demand
(Nature of Demand, Size of the demand, present and
potential, Changes taking place in demand, Invasion of
substitute products, Changes taking place in consumption
pattern/buying habits)
• The consumer (Taste and preferences - Furniture)
• The industry – (Fabric roll on – Mosquito repellant)
• The competition (Absolute advantage – AMD Vs Intel)
• Government policies that are specific to business
concerned
Marketing Realities (self reading page 17-21 in
Kotler)

Major Societal Forces

• Network Information Technology
• Globalization
• Deregulation
• Privatization
• Heightened competition
• Industry convergence
• Consumer resistance
• Retail transformation
• Disintermediation
 Technological
Gadgets

Shipping
Corporations

Logistics

Readymade
Apparel,
Fashion
Designing
Student Group formation
 Unit II
Market Targeting, Developing and
Communicating a Positioning Strategy
Levels of
Segmentation
• Mass Marketing Eg: Ford
• Micro Marketing levels:
1. Segments
2. Niche Eg: Hallmark, Dogster, 1Up.com.
3. Local Areas Eg: Bharat Matrimony
4. Individuals, Customerization. Eg: Galleria
Picture Card
Segment Marketing
• A market segment consist of a group of customers who share
a similar set of needs and wants
• Flexible marketing consists of two parts:
1. A Naked solution
2. Discretionary options
Eg: Lxi/Vxi/Zxi
Eg: Masala tea/ Green tea – Chaipoint
 Segment - Levels and Patterns

• A segment can be characterized in two ways

1. Under preference segments, Homogeneous preferences
2. Diffused preferences
3. Clustered preferences
 Major Segmentation Variables for
Consumer Markets
Major Segmentation Variables for Consumer Markets
Geographic region Pacific Mountain, West North Central, West South Central, East North Central, East South
Central, South Atlantic, Middle Atlantic, New England - Tourism Packages / Scuber

City or metro size Under 5,000; 5,000–20,000; 20,000–50,000; 50,000–100,000; 100,000–250,000;

250,000–500,000; 500,000–1,000,000; 1,000,000–4,000,000; 4,000,000+ - Malls

Density Urban, suburban, rural – Private Schools, Training institutions/Skill development

Climate Northern, southern – Frozen foods/ Ready to eat
Demographic age Under 6, 6–11, 12–17, 18–34, 35–49, 50–64, 64+ - Bank Schemes
Family size 1–2, 3–4, 5+ - Washing Machines Or Refrigerators
Family life cycle Young, single; young, married, no children; young, married, youngest child under 6;
young; married, youngest child 6 or older; older, married, with children; older, married,
no children under 18; older, single; other – Insurance/Mutual Funds

Gender Male, female – Scooty/Pulsar, Hero/BSA SLR

Income Under $10,000; $10,000–$15,000; $15,000–$20,000; $20,000–$30,000; $30,000–
$50,000; $50,000–$100,000; $100,000+ - Hotels, Lodging and Boarding services
 Major Segmentation Variables
for Consumer Markets

Behavioral occasions Regular occasion, special occasion – Barbeque Nation/Teppanyaki

Benefits Quality, service, economy, speed - Automobiles (MS, Toyota)/ D Mart Pick up
stores
User status Nonuser, ex-user, potential user, first-time user, regular user – Provision Stores

Usage rate Light user, medium user, heavy user – Mixer grinder

Loyalty status None, medium, strong, absolute – Royal Enfield/AJIO/Airlines

Readiness stage Unaware, aware, informed interested, desirous, intending to buy – Airtel Prepaid-
Postpaid

Attitude toward Enthusiastic, positive, indifferent, negative, hostile – Myntra/Nestle

product
 Geographic Segmentation

• Geographical units
• Nations, states, regions, counties, cities, or
neighborhoods (Eg: Bajaj CT 100 Vs TVS)
• Nielsen Claritas’ PRIZM
• Education and affluence (Honda)
• Family life cycle (AMT)
• Urbanization (Automation – Fintech companies)
• Race and ethnicity (Manapuram Gold Loan)
• Mobility (DTH to mobile phone)
Demographic Segmentation

• Age and life-cycle stage (Education loan, home loan)

• Life stage (Senior citizen township)
• Race and culture (Kanthara/Racism in Hollywood)
• Gender (Gilette/Venus)
• Generation (Occulus)
• Income
 Demographic Segmentation

• Generation
• Millennials (Gen Y) - RED
• Gen X – Investment and saving
• Baby Boomers – Golf clubs, Karting, Exploring new ways
of life For eg: Subscriptions
• Silent Generation – Convince Vaccines acceptance
Psychographic Segmentation

• Buyers are divided into groups on the basis of

psychological/personality traits, lifestyle, or values
• Eg: Culture frames all behaviors – Afghanistan/US/Japan.
Extreme sport.
VALS Segmentation System
Behavioral Segmentation

• Marketers divide buyers into groups on the basis of their

knowledge of, attitude toward, use of, or response to a
product.
 Behavioral Segmentation

• Needs and benefits

– Amazon Kindle
• Decision roles
• Initiator
• Influencer
• Decider
• Buyer
• User
 User and Usage-Related
Variables

Occasions
User status -
Active/Prospective
Attitude - Shared
attitudes
Usage rate – Light/Heavy
Loyalty status –
Loyal/Switcher
Buyer-readiness stage
 Market Targeting
A target market is a group of people with some shared characteristics that a
company has identified as potential customers for its products. (Eg: One plus,
Blackberry)
blank Description
1. Needs-Based Segmentation Group customers into segments based on similar needs and benefits sought by
customers in solving a particular consumption problem.
2. Segment Identification For each needs-based segment, determine which demographics, lifestyles, and
usage behaviors make the segment distinct and identifiable (actionable).

3. Segment Attractiveness Using predetermined segment attractiveness criteria (such as market growth,
competitive intensity, and market access), determine the overall attractiveness
of each segment.

4. Segment Profitability Determine segment profitability.

5. Segment Positioning For each segment, create a “value proposition” and product-price positioning
strategy based on that segment’s unique customer needs and characteristics.

6. Segment “Acid Test” Create “segment storyboard” to test the attractiveness of each segment’s
positioning strategy.
7. Marketing-Mix Strategy Expand segment positioning strategy to include all aspects of the marketing mix:
product, price, promotion, and place.
Specialty Hospitals
Virgin Galactic Washing Machine

Laboratory
materials for COKE
only
colleges
Segment by Segment Invasion Plan
Effective
Segmentation
Criteria

• Measurable
• Substantial
• Accessible
• Differentiable (eg: Russian cars)
• Actionable
Evaluating and Selecting the
Market Segments

• Possible Levels of Segmentation

Developing a Brand Positioning

• Positioning
• The act of designing a company’s offering and image to
occupy a distinctive place in the minds of the target
market.

• Mercedes Vs BMW
Value Proposition

Examples of Value Propositions

Company and Product Target Customers Value Proposition

Hertz (car rental) Busy professionals Fast, convenient way to rent the right
type of a car at an airport
Volvo (station wagon) Safety-conscious The safest, most durable wagon in
upscale families which your family can ride
Domino’s (pizza) Convenience-minded A delicious hot pizza, delivered
pizza lovers promptly to your door
 Competitive Frame of Reference

• Competitive frame of reference

• Defines which other brands a brand competes with and which should
thus be the focus of competitive analysis (Bajaj Vs AO Smith)
• Identifying and analyzing competitors
Points-of-Difference and Points-of-Parity

• Points-of-difference (PODs)
• Attributes/benefits that
consumers strongly associate
with a brand, positively
evaluate, and believe they
could not find to the same
extent with a competitive
brand
• Eg: Auto Vs Tata Smart
Points-of-Difference and Points-of-Parity

• POD criteria (Royal Enfield Vs Bajaj Dominar)

• Desirable

• Deliverable

• Differentiating
Points-of-Difference and Points-of-Parity

• Points-of-parity (POPs)
• Attribute/benefit associations that are not necessarily
unique to the brand but may in fact be shared with other
brands
Points-of-Difference and Points-of-Parity

• POP forms (Symphony)

• Category

• Correlational

• Competitive
 POP vs. POD

• Multiple Frames of Reference

• Straddle Positioning (Parachute)
 Points-of-Difference and Points-
of-Parity

• Choosing specific POPs

and PODs
• Competitive advantage
• Means of differentiation
(DHL)
• Perceptual map
• Emotional branding
Establishing a Brand Positioning

• Communicating category membership

• Announcing category benefits

• Comparing to exemplars

• Relying on product descriptor

Brand-Positioning Bull’s-Eye
Communicating POPs and PODs

• Negatively correlated attributes/benefits

‒ Low price vs. high quality
‒ Taste vs. low calories
‒ Powerful vs. safe
‒ Ubiquitous vs. exclusive
‒ Varied vs. simple
Monitoring Competition

• Variables in assessing
potential competitors
• Share of market

• Share of mind

• Share of heart

• Share of wallet
Alternative Approaches
to Positioning

• Brand narratives and storytelling

• Setting
• Cast
• Narrative arc (Kill Bill)
• Language
• Cultural branding (Nike)
End