Marketing is a term, which has got different meaning for different groups. For housewives marketing means shopping, for sales person it is merchandising (product designing) and for buyers it is purchasing. If we synthesise these views we understand that marketing is all sort of activities which facilitate the exchange of goods, services, persons, place and idea.
In the process of marketing we have to take the following decision.
- What to be marketed?
- Who is the marketer?
- Who are the customers?
What to be marketed
We can market the following:
1. Goods 2. Services
3. Ideas 4. Place
Goods : It consists of all the consumer and producer goods, vegetable, fruits, soft drinks, cloth, equipments etc.
Services : It consist of services of professionals like doctors, advocates, chartered accounts, mechanics etc.
Ideas : These days ideas are also marketed such as ideas of family planning by donation, protection of railway property, help the needy. Concerned people are persuaded to follow the ideas.
Place : The marketing of place is the common feature of the day. Our tourism departments have been regularly inducing people to visit various tourist and health resorts.
Who is the marketer
Generally seller is the marketer, but buyers can also be marketer. We have been arguing the seller countries that we shall be making its use for peaceful purpose. In case of sophisticated arms also the buying countries insist upon the selling countries to sell it. In this way, marketer can be either seller or buyer, who takes more active interest in the deal.
In this way, marketing management refers to all sorts of activities aimed at designing and executing the marketing strategy for the product. It is as such an operational management.
Traditional Marketing concept
Traditionally, marketing was restricted to the physical transfer of goods from its producers to the consumers. In this way, marketing includes all those activities which facilitated the transfer of goods from producers or manufactures to the users of goods. According to traditional approach goods should be supplied at the time when it is needed, at a place, where they are required and delivered to those who need it.
Modern marketing concept
Modern marketing concept explains that the objectives of the business can be achieved by identifying needs and wants of customers. It stresses consumers’ satisfaction. According to modern thinkers, marketing includes the following :
- Identification of consumers’ needs and their satisfaction.
- Sales forecasting/Target custo-mers.
- Formulation of marketing policy for the specific market.
- Planning and organising of marketing activities.
- Salesmanship and sales promotion.
- Advertising.
- Costing and budgeting efforts.
- Measurement and review of the marketing result.
- Profitability—Profit can not be ignored because it is necessary for survival and growth.
Objectives of marketing
The main objectives of marketing may be mentioned as under :
Creation of demand and securing consumers’ satisfaction
Marketing is consumer oriented activity. Marketing tries to create demand of its product through advertising and sales promotion measures. Consumers’ satisfaction is the ultimate end of all business activities. The business can not last long without consumers’ satisfaction. The potential growth of the company is possible, if consumers are satisfied. Business has its own profit motive. Earning are directly related to sales, which is affected by consumers’ satisfaction.
Retaining reasonable market share
Survival of the enterprise depends upon capturing reasonable share of the market. Marketing helps the enterprise in positioning itself firm in the market. The success of marketing depends upon capturing more and more share of the market.
Building goodwill
The competent and capable marketing management sells quality product at reasonable price and thus goodwill of the enterprise is built. Marketing adopts various image building activities by popularising products at convenient outlets.
Profitable operation
Marketing management refers to all business activities, which are consumer oriented. It is the sincere effort of marketing management to maximum the profit of the company. As profit is directly related to sales, so the marketing management tries to increase its sales by market development, product deve-lopment, market penetration and diversification. The management looks for the opportunities and tries its best to avail of the opportunities. It is the duty of the market management to undertake profitable operations and maximise the profit of the business.
Physical supply of goods
Marketing management has to decide about the physical distribution of goods. This function involves :
Transportation
Transportation facilitates the transfer of products from one place to other. It reduces the distance between the producer and consumers. These days the business uses road, rail, water and air transport for acquiring goods and also for distribution of goods. The marketing management will have to take into consideration the means of transport available for distribution of goods. Transport plays an important role in localising the industry and the nature and type of goods to be produced.
Warehousing
There is wide gap between the production and actual sale of goods. This is why the marketing management is required to make necessary arrangement of storing the raw material and finished goods.
Facilitating transfer of ownership and product
It involves the following function which facilitate the transfer of goods and its ownership :
Product planning and development
Effective product planning anticipates the wants and expectations of the consumers and develops the product accordingly. It requires improvement in the existing product and development of the new product. Decisions regarding size, design, colour, packaging, quality etc. had to be reviewed from time to time. The policy of product differentiation and highlighting the unique and novel features of the product should be adopted. The enterprise should always be prepared to produce goods to suit the ever changing needs of the customers.
Standardising, grading and branding
Standardising is the process of making goods perfectly identical to the model product. Standardising and grading make goods easily marketable.
In case of standardisation, the product contain certain desirable qualities lie durability, safety, utility and special features such as design, weight, colour and size. Standardisation facilitates the purchasing and selling of the product. Good are sold by description. In India I.S.I. mark and Agmark guarantees the quality of the product.
In case of Grading, product is classified into identical lots and groups on the basis of predetermined standards. Grading divides products into different classes of uniform characteristics. Grading is adopted generally in foodgrains, cotton, tobacco, fruits, minerals etc. Fixing and securing remunerative prices from the product is the objective of grading.
Branding means assigning specific name, design, size, symbol, specialities to the product, so that it can be distinguished from the product of other firms, Branding establishers distinct image of the seller in the market and creates reputation and goodwill. Brands like Samsung, LG, Nokia, Parle, Britannia etc. have become very popular.
The purpose of branding is to distinguish it from other products by assigning specific name, design, size, symbol, constituents and other specialities of the product, Branding establishes distinct image of the product and its seller in the market and creates reputation and goodwill.
Packing and packaging
Package means a wrapper or a container beautifully designed to enclose, encase or contain the product. Packaging reduces the risk of spoilage, wastage, meltage, evaporation etc. in the process of transportation and storage.
Packaging does not only provide protective cover to the product but works as silent salesman. It also furnishes useful information regarding the product, i.e., contents, its weight, size, price, constituents, usage, and necessary instruction regarding storing and using the product.
Packing : Distribution of goods from seller to purchaser requires it to be packed appropriately in packets, bundles, containers and cases. Packaging is the process of putting the goods in the market in convenient size and lots. Packing and packaging boost the sale of the product. In this way it is important function of marketing management.
Salesmanship
It is an art of selling goods. It provides necessary knowledge, technical assistance and counsel to the consumer. Effective salesmanship is required to boost sales. It satisfies the needs of the customers.
Advertising and sales promotion
It creates demand for goods among new customers and also sustains the demand for goods among existing consumers. Promotion includes all the activities of the manufactures to influence the behaviours of buyer through communication. It is the process of communicating, persuading and motivating consumers. Sales promotion refers to those activities which supplement both selling and advertising, displays, demonstration and exposition. It is a form of mass communication influencing.
Insurance and Risk Taking
Goods produced and assets of the business are always subject to risks. Their destruction will affect very badly the prospects of the business. It is therefore necessary that the assets of the enterprise must be properly insured, so that due compensation, in case of damage may be received and the business may be saved form destruction.
Marketing research is an effort to ascertain the standing of the enterprise in the industry. It also helps in planning the introduction of new product and development of existing product. The marketing management determines the demand of the product, its price and time, when it is needed. It also conveys consumers’ preferences. Effective method of advertising tries to satisfy consumer effectively and maximise its profit.
As such, marketing research is the systematic investigation of the facts relevant to various aspects in marketing like profitable and unprofitable sales territories, channels of distribution, potential competitors, competitive prices, advertisement and sales promotion and consumers preferences etc.
Financing
Financing is an important function of management. Funds are required to meet fixed and working capital requirements of the business. Financing also facilitates the mechanism of marketing. The company is required to pay dividend and interest at competitive rates, so funds procured must be economically and effectively used. Judicious use of finance will fetch handsome return. The company can gain earning at increased rates, if its activities are consumers’ oriented and customers’ satisfying.
Marekting mix
Marketing mix is a plan which designs marketing strategy regarding controllable variables of market mechanism. These elements are known as products, price, place (distribution) and promotion.
Let us discuss these marketing variables.
Production Mix
It involves the activities relating to the product, service of idea to be offered. It is the marketing strategy in which product components are discussed and decided. The product has many dimensions. Marketing of the product requires that every dimension of product should be given due consideration.
Dimensions of the product
- Volume of output.
- Shape, size and weight of the product.
- Quality and standard of the product.
- Product design.
- Product range.
- Brand name, whether individual brand name just as Lipton tea, Lux Soap or family brand name such as Godrej, LG, Philips etc.
- Package.
- Product testing.
- Service after sale.
- Development of the product etc.
The above dimensions of the product are known as product mix. The product mix aims at satisfying the targeted consumers’ group.
Price mix
It refers to the price charged for the product or service price stands for the exchange value of the product, i.e., what the customer has to pay.
Factors to be considered before fixing Price
Targeted Consumers : It is ascertained, what quantity of the product, the customer will buy at different prices.
Cost : The cost of producing and marketing goods is also taken into consideration.
Competitive Products : If there is tough competition higher price, cannot be charged.
Discounts and allowance : The enterprise will have to decide how much incentive can be granted to dealers and customers in the form of discount and allowance, such as trade discounts and reduction sales etc.
Terms of Credit : If there is competition and practice of credit sale in the market for the product, the firm will have to take decision about the terms and conditions of credit sales.
Profit Margin : It is the price of the product, which vitally affects the margin of profit. This factor can not be ignored.
Price is a variable, which has psychological effect, so it should be reasonable and related to quality.
Promotion Mix
Promotion means informing the customers about product and service and stimulating them to buy. It involves all activities aimed at boosting the sales of the product. The different elements of promotion mix are as under :
Elements of promotion mix
Advertising : It is an activity which establishes non-personal contact with the customers regarding the product, idea and service. It is effort to create and sustain the demand for the product.
Personal Selling : It is an art to induce people to buy the product. It is an effort to win the everlasting confidence of the consumers.
Publicity : It is unpaid mention of the company, its product, brand by the news media in newspaper, journals, radio and television. It is uncontrolled form of promotion.
Sales Promotion : It is an effort to stimulate customers to buy more and more of a particular commodity.
Public Relation : The enterprise may start public contact and programme to introduce the product.
Exhibitions and Demonstration of the Product : In order to promote the product, the enterprise may display product in fairs and exhibitions. It may also demonstrate the product and its actual working.
Distribution mix
It determines the place, where the product should be made available. It also decide whether goods are to be marketed through wholesalers, retailers, own branches, retail outlets or middle men.
Factors affecting marketing mix
While determining suitable marketing mix following factors must be taken into consideration regarding consumers’, dealers’, competitors’ and government behaviour.
Consumer’s buying behaviours
- Buying habits
- Living habits
- Purchasing power
- Attitude and preferences
- Local environment, situations
- Number of consumers of product.
Dealers’ behaviour
- Motivation
- Structure, practices and attitude of dealers
- Financial strength of dealers
- Expected change in the behaviour.
Competitors’ behaviour
- Size and strength of competing units
- Number of competitors
- Practices and attitude of the competitors
- Motives
- Trends in demand and supply.
- Government behavior
- Products
- Prices
- Competitive practices
Restrictive Trade Practices
Advertising and Promotion.
Marketing identifies the needs of the existing and potential consumers and maintain the flow of the commodities. In this way, the consumer oriented activities of the marketing management satisfies the needs of the people and thus provides the sense of relief and pleasure.
Creation of employment opportunities
The growth of population and civilisation goes on multiplying the needs of the people. In order to meet these needs very large number of ventures are promoted. These enterprises require very large number of skilled and unskilled workers. Marketing in this way generates employment opportunities and thus helps us in the eradication of unemployment. In India, about 40 million people are engaged in wholesale and retail business, excluding those engaged in transportation and communication, warehousing, insu-rance and finance.
Improving standard of living
Standard of living is measured by the quality and quantity of commodities, we use. Marketing in addition to supplying the required goods invents and discovers its own novel goods and creates demand for it. We, in this way are supplied with various and varied useful commodities, the use of which improves our standard of living.
Increase in national income
Marketing accelerates the pace of economic activities. More an more business enterprises are promoted. The profit and profitability of ventures increase. Consequently, income of individual increases. As such national income being the sum total of individual income also increases. All these measures bring prosperity to the nation.
Educational value
Marketing is concerned with selling, advertising and sales promotion. Advertising and sales promotion measures educate the general consumers about the uses of the different commodities. The customers are acquainted with the advantage and disadvantages of the various commodities. Even the illiterate people identify the commodities without reading the name of good on the containers and packages. Marketing educates people and creates demands for it.
Benefits from marketing mix
Marketing mix is future marketing strategy to boost sales. It is a planned activity aimed at progressive growth of the enterprise. The enterprise is benefited by the marketing mix. Benefits are summarised as under :
Product oriented benefits
- Production according to needs of the customers.
- Production of saleable quality.
- Improving the quality of the product.
- Attractive designing and packaging.
- Customers’ services after sales.
Price Oriented benefits
- Determination of price according to the paying capacity of customers.
- Fair pricing of the product.
- Availability of credit facility.
- Availability of discount and allowance.
Promotion oriented benefits
- Benefits of advertising.
- Benefits of sale promotion.
- Benefits of personal selling.
