Core Marketing Concepts

Core Marketing
Concepts
Dr. Anupamaa S. Chavan
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anupamaa.chavan@nmims.edu 1

CORE CONCEPTS OF MARKETING
• Need, Want, Demand
• Target Market, Positioning, Segmentation
• Offerings and Brand
• Marketing Channels, Paid, Owned, Earned
Media
• Impression & Engagement
• Value & Satisfaction
• Supply Chain & Competition
• Marketing Environment

NEED
Needs : Human requirements
Basic human requirements:
Eg. Air, Food, Water, Clothing and Shelter
We also need…..
Recreation
Education
Entertainment
Needs become wants when directed to specific objects that satisfy needs
Want : Specific Objects that satisfy the needs
Met needs and Unmet needs…..

TYPES OF NEEDS
• Need can be distinguished in 5 types:
• Stated needs
• Real needs
• Unstated needs
• Delight needs
• Secret needs

Product : Watch
• Stated need: BrandedWatch
• Real need: good brand with reasonable price
• Unstated need: Shows correct time
• Delight need: Get a discount
• Secret need: adds to your status/appreciation
from friends

Product : Car
• Stated needs: The customer wants an inexpensive car.
• Real needs: The customer wants a car whose operating cost,
not initial price, is low.
• Unstated needs: The customer expects good service from the
dealer.
• Delight needs: The customer would like the dealer to
include an onboard GPS system.
• Secret needs: The customer wants friends to see him or her
as a savvy consumer.

EXERCISE
Think of a purchase which you made recently and
give the brief description of various types of needs
related to that purchase.
Example: Purchase of a Watch
1. Stated need: Branded and in fashion
2. Real need: Branded and in fashion and reasonable
3. Unstated need: Shows time correctly
4. Delight need: Getting 20% off
5. Secret need: Appreciation from peers. https://youtu.be/XhMVWzVXNNk
7

WANT
• Need becomes want when directed to specific objects.
• When hungry what will you have……..
• Wants are specific ….
• Burger, Dosa, Pizza, Paratha, Puffed rice….
• Wants are shaped by society…
• Time /Period is also important…..

DEMAND
• Demands are wants for specific products backed by
an ability and willingness to pay.
• Marketers are sometimes criticized for making
people buy things they don’t want.

Demand States
• Negative Demand
• Non Existing Demand
• Latent Demand
• Declining Demand
• Irregular Demand
• Full Demand
• Overfull Demand
• Unwholesome Demand
S4

Demand States
Demand State
1. Negative Demand
2. Non Existing Demand
3. Latent Demand
4. Declining Demand
5. Irregular Demand
6. Full Demand
7. Overfull Demand
8. Unwholesome Demand
Marketing Task
1. Disabuse Demand
2.Create Demand
3. Develop Demand
4. Revitalize Demand
5. Synchronize Demand
6. Maintain Demand
7. Reduce Demand
8. Destroy Demand
Format
1. Conversional Marketing
demand states.pptx
2. Stimulation Marketing noddnodd.pptx
3. Developmental Marketing develomental
marketing.pptx
4. Remarketing remarketingremarketing.pptx
5. Synchro-marketing irregulardemandirregulardemand.pptx
6. Maintenance Marketing fullddfulldd.pptx
7. Demarketing overfulldd.pptxoverfulldd.pptx
8. Counter Marketing unwholesomeddunwholesomedd.pptx

Exercise
• Give 5 examples of every demand state.

Case Study :
anupamaa.chavan@nmims.edu
13
Coca Cola was invented in the late 19th
century by John Stith Pemberton and was
bought out by businessman Asa Griggs
Candler, whose marketing tactics led Coca-
Cola to its dominance of the world soft-drink
market https://youtu.be/XhMVWzVXNNk
John Stith Pemberton

Assignment
• Enumerate the strategies used by Coca Cola in the audio
visual seen.

Target Markets
• Market is an arena for Potential Exchange
• Market is a set of existing and potential buyers for a
product
• Market is heterogeneous
• Target Markets are prospects to whom the product is
to be sold.
S5

Positioning
• Positioning refers to an overall strategy that ‘aims to
make a brand occupy a distinct position, relative to
competing brands, in the mind of the customer’
• A good position gives the product a USP (Unique
selling proposition).

Positioning
• The objective of market positioning is to establish the
image or identity of a brand or product so that consumers
perceive it in a certain way.
• For example:
• A handbag maker may position itself as a luxury status
symbol
• A TV maker may position its TV as the most innovative
and cutting-edge
• A fast-food restaurant chain may position itself as the
provider of cheap meals

Positioning
• A few examples are positioning by:
• Product attributes and benefits: Associating your brand/product with
certain characteristics or with certain beneficial value
• Product price: Associating your brand/product with competitive pricing
• Product quality: Associating your brand/product with high quality
• Product use and application: Associating your brand/product with a
specific use
• Competitors product: Making consumers think that your brand/product is
better than your competitors product

Examples
• Volvo – Drives safely
• Maruti Suzuki – Economy, Reliability, Service
• Safola – No Cholesterol
• Nokia – Connecting people: Complan – Complete food
healthy drink
• Hero Honda – Better Mileage
• Business Today – Business Magazine

Market Segmentation
• Definition:
• ‘Market segmentation consists of taking the total
heterogeneous market for a product and dividing it
into several sub markets or segment each of which
tends to be homogeneous in all significant aspects’
S6

Bases of Market Segmentation
• Kotler provides four classes of variables used in segmenting
consumer market:
• Geographic : Country, Zones, Cities, Villages, Density, Climate
• Demographic: Age, Gender, Family size, Education, Income,
Occupation, Religion, Nationality
• Psychographic: Social class, Lifestyle, Personality
• Behavioral: Occasions, User rate, Benefit, User status, Loyalty,
Readiness stage, Attitude

Glow

OFFERING
• An offering in marketing is the total offer made to
your customers.
• An offering is more than the product itself and
includes elements that represent additional value to
your customers, such as availability, convenient
delivery, technical support or quality of service.
• An offering can also consists of a tangible product or
service plus related services such as installation,
repair, warranties or guarantees, packaging, technical
support, field support, and other services.

OFFERING
• Offer is the tangible or intangible value added to the
product.
• The intangible Value Proposition is made physical
by an offering, which can be combination of product,
services, information and experience.

BRAND
• A brand is a name, term, design, symbol, or other feature that distinguishes an
organization or product from its rivals in the eyes of the customer.
• Trademarks are registered brands
• You have :
• Individual brand: eg – Surf, Lux
• Family brand: Amul, Ponds
• Umbrella brand: Godrej
• Combination brand: Maruti Suzuki
• Private or Middlemen brand: Shopper’s Stop

MARKETING CHANNELS
• It includes:
• Communication channels
• Distribution Channels
• Service Channels

COMMUNICATION CHANNELS
• Communication Channels deliver and receive messages
from target buyers.
• Includes the conventional media and also digital media

DISTRIBUTION CHANNELS
Distribution channels helps display, sell or deliver the physical products or
services to the buyer or user
These channels may be direct via Internet, phone, mail or indirect through
distributors, wholesalers, retailers, agents and other intermediaries

SERVICES CHANNELS
• Service channels include warehousing, transportation
companies, banks and insurance companies
• Marketers need to choose the best mix of
communication, distribution and service channels for
their offerings

Paid, Owned,& Earned Media
• Paid Media:
• Conventional methods
• Various media available: indoor, outdoor, direct and indirect

Media of Advertising:
Conventional
Press
Newspaper
Magazines
Radio
Films
T.V
Posters
Painted Display
Travelling Display
Electrical Signs
Skywriting
Sandwichmen
Sales Letters
Envelops
Circulars
Gifts
Package - Inserts
Catalogues
Window Display
Interior Display
Showrooms
Exhibitions
Indoor Outdoor Direct Indirect

• Owned Media:
• Owned by company
• Company/Brand Brochure
• Website, Facebook,Twitter account, Instagram acct. Snapchat
acct. etc.

• Earned Media:
• Consumers, Press, Outsiders voluntarily speak about companies
brand/product via word of mouth, buzz, or viral marketing

IMPRESSION
• Impression occurs when consumers view a communication
• An impression is an estimate of the number of people a
particular advertisement is reaching.
• But impressions don’t provide any insight into the results of
viewing the communication.

ENGAGEMENT
Its all about the extent of a customer’s attention and active
involvement with a communication
Some online ‘engagements’ are
Facebook – likes
Twitter – tweets
Comments on Blog/Websites
Sharing of video or other content.
Engagement can augment/transform the firm’s products or services

SATISFACTION
Satisfaction reflects a person’s judgment of a product’s
performance in relationship to expectations.
In other words satisfaction is derived when the product is
able to meet the expectation of the consumer.
When the product surpasses the expectation level and gives
much more to the customer beyond his expectation it
creates delight.

VALUE
• Value is the sum of the tangible and intangible benefits
over costs.
• Value is a central marketing concept which is primarily a
combination of quality, service and price (qsp), known as
customer value triad
• ‘Marketing is all about creating communicating and
delivering value to target market to build profitable
customer relationship’

VALUE
• Value is dynamic
• Value changes depending upon innovation, competition
etc, therefore create a value which is sustainable and
continuous

EXERCISE
• You want to buy a smart phone.
• Enlist the value addition you seek in it.

CustomerValue
• Customer value is the difference between the values the customer gains
from owning and using a product and the cost of obtaining the product.
• Total CustomerValue is the total sum of product value, services value,
personnel value and image value.
• Total Customer Cost is the sum total of all the costs a customer incurs in
acquiring the product which include monetary, time, psychological and
energy costs

Building CustomerValue, Satisfaction, and Loyalty
• Customer-Perceived value (CPV)
• The difference between the prospective customer’s
evaluation of all the benefits and costs of an offering and
the perceived alternatives
• Total customer benefit vs. Total customer cost

Determinants of CPV

Exercise

Exercise
• Customer-Perceived value (CPV): The difference between the prospective customer’s evaluation
of all the benefits and costs of an offering and the perceived alternatives
• Total Customer Benefit is the total sum of product value, services value,
personnel value and image value.
• ProductValue : Super fast train with Automatic doors, bio-vacuum toilet
• Service Value: GPS enabled compartments and WIFI connectivity
• Personnel Value: Good onboard staff
• ImageValue: Travelling byVande Bharat Express (an Engineering Marvel)
• Total Customer Cost is the sum total of all the costs a customer incurs in
acquiring the product which include monetary, time, psychological and
energy costs
• Monetary value: Rs. 510 to Rs. 3310
• Time cost: Amount of time spent to check the alternatives and decide the travel plan
byVande Bharat Express
• Energy cost: Physical efforts put in to arrange and fix the travel by Vande Bharat
Express (booking tickets)
• Psychological Cost: Efforts put in analyzing, evaluating and decision making to
travel byVande Bharat Express
anupamaa.chavan@nmims.edu
45

CustomerValue Analysis
1. Identify the major attributes and benefits that customers
value
2. Assess the quantitative importance of the different attributes
and benefits
3. Assess the company’s and competitors’ performances on the
different customer values against their rated importance
4.Examine how customers in a specific segment rate the
company’s performance against a specific major competitor
on an individual attribute or benefit basis
5. Monitor customer values over time

CreatingValue for Customers
• Customer value can be bifurcated into two broad
categories:
1.Tangible values
2. Intangible values

CustomerValue
TangibleValues
• Functional value
• Economic value
• Convenience value
• Sensory/Aesthetic value
• Service value
IntangibleValues
• Social value
• Prestige/StatusValue
• Sentiment value
• Experience value
• BeliefValue

Components ofValue Delivery
Process:
• Selecting theValue
• Creating theValue
• Communicating theValue
• Delivering theValue
• Capturing the value back fro the Market
• Enhancing theValue

Exercise:
• Select any five goods which you have bought and identify
the values added to those products.
• Using the components of customer value, design the
value proposition for a new brand of toothpaste. Support
your answer with an appropriate brand name.
• value exercise.docx

Marketing Mix Concept
• McCarthy classified various marketing activities into marketing mix tools of four broad kinds, which he called the
four P’s of marketing.
• Product
• Price
• Place
• Promotion
In addition to the above, 4P’s are updated to represent the Holistic Marketing Concept that encompasses the Modern
Marketing realities:
• People
• Processes
• Programs
• Performances

4A’s FRAMEWORK – by Sheth and Sisodia
• Sheth and Sisodia (2012), emphasis on the 4 A’s that are the four important customer values –
• Acceptability: It is the measure of the extent to which a company’s total product offering exceeds customer
expectations.
• Affordability: The extent, to which, customers in the target market are able and willing to pay the product’s
price. It has two dimensions: economic (ability to pay) and psychological (willingness to pay). Acceptability
combined with affordability determines the product’s value proposition
• Accessibility: The extent, to which customers are able to readily acquire the product, has two dimensions:
availability and convenience.
• Awareness: The extent, to which customers are informed regarding the product’s characteristics, persuaded to
try it, and reminded to repurchase. It has two dimensions: brand awareness and product knowledge.

Building CustomerValue, Satisfaction, and Loyalty

Exercise
• Discuss the elements of traditional marketing mix for
Dettol handwash
• ExplainTraditional Marketing Mix
• Product: Brand name, Variety in colour and fragrance, packages
• Promotion: Advertising, Sales Promotion
• Place:Widely available in retail outlets and also on online
platforms
• Price: Value Based Pricing

Supply Chain (SC)
• Supply chain activities involve the transformation
of natural resources, raw materials, and components into a
finished product that is delivered to the end customer.
• A supply chain is a system of organizations, people,
activities, information, and resources involved in
moving product or service from supplier to customer

SUPPLY CHAIN

Typical stages in Supply Chain

Flow of Product, Information & Funds

COMPETITION
• Competition includes all the actual and potential rival
offerings and substitutes a buyer might consider.

MARKETING ENVIRONMENT
• Marketing environment consist of:
• 1.Task environment
• 2. Broad environment

Task Environment
• Includes actors in engaged in producing, distributing and
promoting the offering
• These are suppliers (material suppliers and service
suppliers), distributors, dealers and target customers

Broad Environment
• Includes six components:
• 1. Demographic environment - 7
• 2. Economic environment - 8
• 3. Socio-Cultural environment – 9
• 4. Natural environment- 10
• 5.Technological environment - 11
• 6. Political-Legal environment - 12

Activity
• Explain the elements of Broad environment with
examples.

Scope of Marketing
• Marketing is all about identifying and meeting human and
social need
• Its all about:
• ‘Meeting Needs Profitably’
• The aim of marketing is to know and understand the customer
so well that product or service fits him and sells by itself.

Scope of Marketing
• The scope of marketing addresses the question what is marketing, what is marketed, the
marketing process and who performs the marketing.
• The scope of marketing is vast. It is the focal point of all business activities.
• The production and selling process loses its significance without efficient marketing.
• Marketing begins with conception of idea to be sold in form of a product which will
lead to attainment of marketing goal.
• Marketing involves identifying the target market whose needs and wants are to be
satisfied, developing appropriate product, pricing, promotion and distribution of the
product and identifying the post purchase behavior of consumers and identifying the
reaction of consumer towards marketing mix strategies.

What is Marketed
Marketers market 10 types of entities:
• Goods :
• Services:
• Events:
• Experiences:
• Persons:
• Places:
• Properties:
• Organizations:
• Information:
• Ideas
Consumer Goods, Industrial Goods Types of goods.pptx
Airlines, Hotels, Car Rentals, Insurance
World Cup, Olympics, AsianGames
Walt DisneyWorld, Imagica,Trekking
Artists, Musicians, Physicians
Tourism, Cities,Towns
Real Property, Financial Properties
Museums, PerformingArts Organizations
Books, Schools, Universities
Every market offering include a basic idea
Eg.Charles Revson of Revlon asserts :‘ In factory we make
cosmetics, but in the drug store we sell hope.’

• Exercise 6
• List down the various products or services that you
have purchased under the 10 entities that are
marketed

Caselets
https://youtu.be/iOi4b7XeSMg

Company
Philosophies/concepts/Orientations to
Market Place
• We need to understand the evolution of marketing philosophies.
• Marketing as a Concept/Philosophy/Orientation
• The different marketing concepts are as follows:
• The Exchange Concept
• The Production Concept
• The Product Concept
• The Sales Concept
• The Marketing Concept
• The Holistic Marketing Concept

The Exchange Concept
• The central idea of marketing is just ‘exchange’ of product
between the buyer and the seller
• Business /Marketing is simply a matter of giving a product to
someone in exchange.
• Most short sighted view
• Marketing is much broader than exchange

The Production Concept
• Marketers believe in :
• Mass Production
• High Production Efficiency
• Creates economies of scale thus reduces cost
• Mass distribution
• Eg: Lenovo largest PC manufacturer, Haier domestic appliances, also

The Product Concept
• Under this concept the marketers think :
• ‘product excellence’ is the supreme thing
• Consumers prefer high quality/performance/innovative features
• Better product will by itself lead people to beat a path to their door
• Eg:
• Eg:Apple - Iphone
• Many start ups failed as they concentrated only on product s offered
• Dazo, an app-based service that curated and delivered meals, has
suddenly shut down its operations —barely a year after it started. It
came as a surprise to many as the company was backed by bigwigs such
as Google India chief Ranjan Anandan, TaxiForSure co-founder
Aprameya Radhakrishna, and former Freecharge chief executive Alok
Goel

Marketing Myopia
• The term 'marketing myopia' was first expressed in
a famous article written by Theodore Levitt for
the Harvard Business Review in 1960.
• In 'Marketing Myopia,' Levitt argued that many
companies incorrectly take a shortsighted approach
to marketing, viewing it as merely a tool for selling
products.
• Instead, he argued that companies should look at
marketing from the consumer's point of view and
not from the point of view of company.
Example: Kodak and Nokia – leaders at one time failed
to understand the market trend which led to their
downfall

The Selling Concepts
• This concepts holds that consumers and businesses if left
alone won’t buy enough.
• Efforts are taken the to sell the products
• Practiced aggressively for Unsought goods
• Eg: Cemetry plots, Life Insurance,Vaccination
https://www.youtube.com/watch?v=_rgQMsvYyps&feature=youtu.be

The Marketing Concepts
• This concept emerged in mid – 1950
• Consumer Centric
• Focuses on right products for your customers instead of
finding right customers for your product.
• Eg: Dell provides customized features in the laptops/PCs

The Holistic Marketing Concept
• “The Holistic Marketing Concept is based on the development,
design and implementation of marketing programs, processes
and activities that recognizes their breadth and inter-
dependencies.” -Philip Kotler
• According to holistic marketing concept, even if a business is
made of various departments, the departments have to come
together to project a positive & united business image in the
minds of the customer.

The Holistic Marketing Concept
• Based on four broad components:
• Relationship Marketing
• Integrated Marketing
• Internal Marketing
• Performance Marketing

Relationship Marketing
• A key goal of marketing is to develop deep,
enduring relationships with people and
organizations that directly or indirectly affect
the success of the firm’s marketing activities.
• Relationship marketing aims to build mutually
satisfying long term relationships with key
constituents in order to earn and retain their
business.

Relationship Marketing
• Four key constituents for relationship marketing are:
• Customers
• Employees
• Marketing Partners ( channels, suppliers, distributors, agencies)
• Members of financial communities (shareholders, investors, analyst)
• It includes :
• CRM – Customer Relationship Management
• PRM – Partners Relationship Management

Integrated Marketing
• Synergy is to be created.
• All marketing activities are required to be well integrated.
• Integrate
• Products/Services
• Promotion (Communications)
• Place (Channels)
• Price
Devise marketing activities and programs that create, communicate, and
deliver value such that “the whole is greater than the sum of its parts.”

Internal Marketing
• Internal marketing is the task of hiring, training and
motivating able employees who want to serve customers
well.
• Marketing succeeds only when people of all departments
work together in co-ordination to achieve customer
goals.

Performance Marketing
• Performance marketing requires understanding the financial and
nonfinancial returns to business and society from marketing
activities and programs
• Evaluation of :
• Financial Accountability: – Sales, Market share, customer loss rate,
customer dissatisfaction, product quality and other measures
• Social Responsibility:- Legal, Ethical, Social, effects of marketing activities
and programs
• Environmental Sustainability

FADS
• Fad:
• is ‘unpredictable and short-lived and without
social, economic and political significance’.
• an intense and widely shared enthusiasm for
something, especially one that is short-lived; a
craze.
• A company requires good timing and luck to
get it right.
• Eg: fashion
Dr. Anupamaa S Chavan 87

TREND
• A direction or sequence of events with momentum
and durability.
• A trend is more predictable and durable than a fad
• Trends reveal the shape of the future and can
provide strategic direction
• Eg:A trend towards health and nutrition awareness
has brought increased Government regulation and
negative publicity for firms dealing in unhealthy
food – Maggi
• GoingVegan
• Trend during Covid – Social Distancing

MEGATRENDS
• A megatrend is a large social, economic, political, and
technological change that is slow to form, and once in
place, influences us for some time 7 to 10years or longer.
• Eg: Renewable energy, Bricks and Clicks

Marketing Environment
Internal Environmental Factors External Environmental Factors
Micro Factors Macro Factors
Customer
Competitors
Suppliers
Society
Marketing
intermediaries
Demographic
Economic
Technological
Cultural/Social
Political
Natural
Legal
Men
Money
Machinery
Materials
Markets

Core Marketing Concepts

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