Pom Chapter 1 PDF

Marketing is a dynamic and multifaceted discipline that plays an important role in today\'s business landscape. It encompasses a broad range of activities aimed at creating. communicating, delivering, and exchanging value for products or services. At its core, marketing is about understanding custom...

Marketing is a dynamic and multifaceted discipline that plays an important role in today\'s business landscape. It encompasses a broad range of activities aimed at creating. communicating, delivering, and exchanging value for products or services. At its core, marketing is about understanding customers\' needs and wants, and strategically positioning offerings to meet those demands effectively. In a rapidly evolving marketplace, successful marketing requires a deep understanding of consumer behaviour, market trends, and competitive landscapes. It involves conducting thorough market research, segmenting target audiences, and developing compelling value propositions to differentiate products or services from competitors. Furthermore, marketing involves designing persuasive messages and selecting appropriate communication channels to reach and engage the intended audience. This can encompass traditional advertising, social media, public relations, and more. Effective marketing campaigns aim to build brand awareness, foster customer loyalty, and ultimately drive profitable customer actions. Additionally, in today\'s digital age, technology has revolutionized marketing by offering innovative tools and platforms to reach global audiences. As such, marketers must stay up to date with the latest trends and leverage data-driven insights to make informed decisions and achieve measurable results. Let us understand a few terms that we are going to use throughout the course, before we go on to explain the nature of marketing. TERMS USED Needs and Wants Needs and wants are fundamental concepts in marketing that help understand consumer behaviour and drive purchase decisions. According to Kotler and Keller, \"Needs are the basic human requirements such as for air, food, water, clothing, and shelter. Humans also have strong needs for recreation, education, and entertainment. These needs become wants when they are directed to specific objects that might satisfy the need\" For instance, an American needs food and wants a hamburger. A person may feel the need for recreation and entertainment and may want to watch his favourite series on Netflix. Thus, needs are the basic, essential human requirements for survival and well-being. They include necessities such as food, water, shelter and clothing Additionally, needs also encompass higher level needs like recreation, education, social interaction, and entertainment. These needs are inherent to human existence and are not influenced by external factors. On the other hand, wants arise when specific objects or products are sought to satisfy those needs. Wants are shaped by personal preferences, cultural influences, social factors, and individual desires. In the example given, the need for food can translate into a want for a hamburger, as it represents a specific object that can fulfil the need for nourishment. Similarly, the need for recreation and entertainment can result in a want to watch a popular series on Netflix. Understanding the distinction between needs and wants is essential for marketers. They need to identify and align their products or services with the wants of their target market, as satisfying those wants ultimately leads to the fulfilment of underlying needs. By understanding consumer needs and wants, marketers can create and communicate value propositions that resonate with their target audience, triggering desire and driving purchase decisions. Marketing \"Marketing is the performance of those business activities that direct the flow of goods and services from producer to consumer or user.\" -American Marketing Association Marketing is defined as \'the process by which companies engage customers, build strong customer relationships, and create customer value in order to capture value from customers in return.\" -Philip Kotler The ultimate goal of marketing is to create mutually beneficial exchanges where companies offer products or services that satisfy customer needs and wants, and customers willingly provide value in return. The process of marketing involves several interconnected activities. First, it entails understanding customer needs, desires, and preferences through market research and analysis. By gaining insights about customer behaviour and market trends, companies can identify opportunities and develop offerings that align with customer expectations. Once customer needs are understood, marketing involves creating and communicating value propositions. Companies must develop compelling messages that highlight the benefits and unique qualities of their products or services, positioning them as the best solutions to fulfil customer needs. Effective communication channels and strategies are employed to reach and engage the target audience. Building strong customer relationships is a central aspect of marketing. By providing excellent customer experiences, addressing customer concerns, and fostering positive interactions, companies can cultivate customer loyalty and retention. Additionally, marketing involves ongoing customer engagement and relationship management through activities such as personalized communication, loyalty programs, and customer feedback analysis. Ultimately, successful marketing results in the creation of customer value and satisfaction, which in turn leads to positive word-of-mouth, customer loyalty and repeat purchases. Market \"A market consists of all the potential customers sharing a particular need or want who might be willing and able to engage in exchange to satisfy that need or want.\" -Philip Kotler Thus, a market refers to the set of actual and potential buyers of a product who have the willingness and the capacity to satisfy a particular need or a want. Consider, a factory worker and a CEO of a company, both wanting to buy a Mercedes car. The factory worker has the willingness to buy but may not have the capacity (purchasing power to buy the product), thus, will not constitute the market for the product (Mercedes car). The CEO, on the other hand, has the willingness and the capacity to buy the product, and thus, is a part of the market for Mercedes car. The concept of a market goes beyond a physical place or a specific group of people. It encompasses all the potential customers who share a common need or want and have the willingness and ability to engage in an exchange to satisfy that need or want. A market is characterized by the presence of both actual buyers who have already made a purchase and potential buyers who may be interested in making a purchase in the future. Understanding the market is crucial for businesses as it allows them to identify and target their potential customers effectively. By analysing the characteristics, needs, preferences, and purchasing power of the market, companies can tailor their marketing strategies, product offerings, pricing, and distribution channels to align with the specific requirements and demands of the target market. Marketing Management \"Marketing management is the process of planning and executing the conception, pricing, promotion and distribution of ideas, goods and services to create exchanges that satisfy individual and organisational goals\" -American Marketing Association The planning function involves setting clear marketing objectives and developing strategies to achieve them. This includes conducting market research to understand customer preferences, analysing competition, and identifying market trends. Marketing managers use this information to formulate comprehensive strategies that determine target markets, product positioning, and differentiation. They also decide on product offerings, pricing strategies, promotion tactics, and distribution channels. Planning also involves allocating resources effectively and creating a timeline for implementation. Once the marketing plan is in place, the execution function comes into play. This involves translating the strategies and decisions outlined in the plan into actionable steps. Marketing teams create and implement campaigns, design advertisements, develop content, and leverage various channels such as social media, traditional media, and online platforms to reach the target audience. Coordination among team members is crucial to ensure a consistent and cohesive message across all touchpoints. Monitoring progress is also a part of the execution function, allowing managers to track the performance of campaigns, assess their effectiveness, and make necessary adjustments in real-time. NATURE/FEATURES OF MARKETING 1\. Marketing is Consumer-oriented: Customer orientation is an important feature of marketing that aims at understanding and meeting the needs of customers. By aligning marketing efforts with customer preferences, businesses can develop products and services that resonate with their target audience. Customer orientation emphasizes putting the customer at the centre of all marketing efforts and aligning the company\'s strategies and activities accordingly. This customer-centric approach is crucial for building strong relationships, enhancing customer satisfaction, and ultimately driving business success. A company that adopts customer orientation recognizes that different customers have unique needs, preferences and requirements. By tailoring its product offerings to individual customer segments, the company can provide more value and enhance the overall customer experience. For instance, Sensodyne came out with a toothpaste that has been specially designed for people who have a sensitivity problem in their teeth (a segment whose needs were not being met before) and claims to provide relief from sensitivity in 60 seconds. Another example of customer orientation in marketing is the implementation of personalized marketing communications. By understanding customer preferences, behaviours, and demographics, companies can tailor their marketing messages to individual customers or specific target segments. This allows them to create more relevant and engaging experiences, leading to increased customer engagement and loyalty. An example of this is customised product recommendations made by the e-commerce sites. On the basis of the shopping history of the consumer, the e-commerce sites suggest specific product recommendations to consumers and these recommendations are unique/personalised for every consumer and is, therefore, different for every consumer. 2.Marketing Starts and Ends with the Customer: Marketing is a comprehensive process that revolves around understanding and satisfying customer needs and desires. It begins with the customer and ends with the customer, as every aspect of marketing aims to connect with, engage, and deliver value to the target audience. Marketing revolves around the customer from start to finish. It begins with understanding their needs, designing offerings to meet those needs, and crafting compelling messages to engage them. It continues by fostering relationships, actively listening to feedback, and adapting strategies accordingly. The end goal is to create customer value, satisfaction, and loyalty, ensuring a mutually beneficial relationship between the customer and the brand. 3\. Marketing Precedes and Succeeds Production: Marketing activities start far ahead of production and continue even after the product is ready. The producers first ascertain what the consumers want and then produce goods according to the needs of the consumers. There is a systematic effort to sell goods and services through suitable outlets and distribution channels, at reasonable prices. Thus, marketing plays a vital role in both the pre-production and post-production stages of a product. Let us understand this in detail here. Before producing a product or service, marketers conduct extensive market research to understand consumer needs, preferences, and market dynamics. This research helps identify potential demand, target audiences, and competitive landscape, etc. Marketing insights obtained from market research contribute to the development and refinement of the product or service. Marketers collaborate with product managers and designers to align the product\'s features, design, and functionality with the identified consumer needs and desires. Marketing continues after production to promote the product and communicate its value proposition to the target audience. Through advertising, content marketing, social media campaigns, influencer collaborations, and other promotional activities, marketers aim to increase brand awareness, generate leads, and drive sales. Marketing also involves collaborating with intermediaries to ensure effective distribution and availability of the product. This includes determining distribution channels, managing relationships with retailers and distributors, and implementing sales strategies to maximize product reach and accessibility. Marketing also plays a crucial role in engaging customers post-purchase to build loyalty and log-term relationship with them. Activities such as customer support, loyalty programs, and gathering feedback contribute to customer satisfaction and help drive repeat purchases. 4\. Marketing is a Science as well as an Art: Any body of knowledge that has a systematised body of knowledge that can be taught and learnt in classrooms is a science. This body of knowledge may consist of theories, principles and practices that relate to that particular discipline. Marketing is a science as it has a systematic body of knowledge that is in existence, It has certain theories, principles, practices, case studies etc. that can be taught and learnt by budding marketer marketers for efficient performance and in strategic thinking while formulating marketing plans for an organisation. Marketing is also an art as it involves practical application of the knowledge learnt into practice. Every marketing manager may have his/her own unique way of applying knowledge to action. Art is a creative expression of oneself, and thus, when marketing managers design marketing strategies according to their own creative capabilities, aligning with their values and thought process, marketing emerges as an art in true sense. For instance, two marketing managers may have learnt the same marketing lessons going to a common school. However, while designing promotional strategy, one may want to use a popular celebrity to endorse the brand as he might think that this will get more attention of the consumers while the other may want to use a catchy jingle in the ad to attract attention. Thus, marketing is both a science as well as an art. 5\. Marketing is a Profession: Marketing is an important profession and a lot of people get their employment due to a lot of job opportunities existing in the field of marketing. Marketing has emerged as a very popular career in recent times. Professionals and experts in the area of marketing enjoy a high premium in the job market. Professional marketers are expected to conduct themselves with integrity, transparency, and fairness in their interactions with customers, stakeholders, and the general public. With marketing evolving as a result of integration of technology with the marketing strategies, the creative talent in this industry has no dearth of opportunities available in the market. Even the young professionals in the industry are doing some great work as they are experimenting with how technology can be used in various areas of marketing, creating experiences for the consumers unique ways. in One of the young marketing professionals in India, Himanshu Goel, has created India\'s first virtual influencer \'Kyra. Кута has an Instagram account and is already doing some paid partnerships with big brands. To see Kyra\'s paid partnership with American Tourister in an Instagram reel, scan this QR Code. 6\. Exchange Process is the Essence of Marketing: The exchange process is considered as the essence of marketing because it lies at the core of every marketing transaction. Marketing revolves around creating, facilitating, and enhancing exchanges between buyers and sellers. Marketing recognizes that successful exchanges should benefit both parties involved the buyer and the seller. Buyers seek products or services that fulfil their needs and desires, while sellers aim to generate revenue and achieve their marketing objectives. Through effective marketing strategies, the exchange process seeks to align these interests and create a mutually beneficial transaction. 7\. Marketing is Goal-oriented: Marketing is indeed a goal-oriented discipline, as its primary purpose is to achieve specific objectives and drive desired outcomes for a business or organization. These goals can vary depending on the organization\'s overall strategy and may include increasing sales, expanding market share, enhancing brand awareness, generating leads, improving customer retention, or launching a new product. These goals can vary depending on the organization, industry, and marketing campaign. These goals provide direction and focus for marketing efforts, allowing businesses to measure their success and effectiveness of the marketing campaigns. For instance, if the objective of marketing is to create brand awareness and induce brand trial of a new brand of coloured contact lenses, marketing activities may consist of sponsorship of college festivals (place where you will find your target market), on- ground activities like free trials in shopping malls and college fests, promotion on Instagram as sponsored posts or reels made by a fashion influencer (as figures on statista.com reveal that young consumers are most active on Instagram as compared to other social media platforms). To take another example, during the COVID lockdown in 2020, the demand for online courses saw a surge. In order to create awareness and encourage enrolment, education technology company, Unacademy roped in celebrities such as Virat Kohli, Anushka Sharma and Shashi Tharoor to conduct live classes on the official website. These celebrities shared the post for the classes on their Instagram and Twitter pages, which helped to attract a sizable audience for their live sessions. (Note in the picture that Virat Kohli\'s Instagram post received more than 10 lakh likes). Virat Kohli and Anushka Sharma\'s live session was attended by more than 50,000 students. Additionally, Shash Tharoor\'s three live classes were a great success, drawing more than 30,000 learners to each session. Other goals of a marketing campaign can be brand building, meeting competition, increasing the market share, etc. To take other examples, the objective of a promotional campaign of a tourist place is to attract tourists to the place (example, \"Kushboo Gujarat Ki\" campaign), and the goal of a political marketing campaign is to win the votes of the voters. Scan the following QR codes to see soe of the ads of the popular campaign \"Kushboo Gujarat Ki\". 8.Marketing is Creative: Marketing is often referred to as creative because it involves the process of developing innovative strategies and tactics to promote products, services, or ideas to a target audience. Creativity plays a crucial role in marketing as it allows businesses to stand out from competitors, capture attention, and engage with their customers in meaningful ways. Be it designing of products, creating brand mascots, designing product packages, creating jingles for the ad, use of engaging storylines in advertisements or even creating memes around some trending ads, all come out of the creative hats of the marketers. Consider the following marketing campaigns - Amul\'s creative illustration on the package of Amul butter (inspired by the movie \'Kabhi Khushi Kabhi Gam\'), Cred\'s popular campaign \'Indiranagar ka Gunda Hoon Main\' featuring Rahul Dravid (in an avatar never seen before) for its creative storyline, Zomato\'s interesting take on the same and the popular jingle (another example of creativity) of Airtel\'s \'Har Ek Friend Zaroori Hota Hai\' campaign SCOPE OF MARKETING (FUNCTIONS OF MARKETING) The scope of marketing is defined by the various functions that are performed within its to see some of realm. These functions can broadly be classified into four broad categories (functions of research, functions of exchange, functions of physical treatment and functions that facilitate exchange) and are discussed below. I. Functions of Research 1\. Market Research: This involves gathering and analysing data about market trends, customer preferences, and competitor activities. Market research facilitates informed decision-making and helps marketers identify market opportunities and consumer needs. For instance, a company might conduct surveys and focus groups to understand customer preferences before launching a new product. 2\. Product Design and Development: Product design and development in marketing refers to the process of creating and improving goods or services to meet customer needs and preferences. It involves conceptualizing, designing, and refining products from ideation to launch. Product design encompasses the aesthetic, functional, and experiential aspects of a product, while development involves turning the design concept into a tangible offering. This process requires market research, prototyping, testing, and iteration to ensure that the final product aligns with customer expectations, market trends, and business goals. II\. Functions of Exchange Exchange is a fundamental concept in marketing that involves the transfer of goods, services, or value between a buyer and a seller. The key functions involving exchange are the following. 1\. Buying and Assembling: The function of buying involves identifying, selecting, and procuring products or services from suppliers or other businesses. It includes activities such as supplier evaluation, negotiating contracts, and managing purchasing processes. Buying ensures that the organization acquires the necessary goods and services to meet customer demands or support its operations. Assembling, also known as production or manufacturing, involves the physical or logistical process of combining or integrating various components, parts, or resources to create finished products. 2\. Selling: Selling is the function of persuading and influencing customers to make a purchase. It involves understanding customer needs, presenting product information, addressing objections, and closing the sale. Selling encompasses various activities such as personal selling, online sales, telemarketing, and sales promotions. The goal is to create a favourable buying experience for customers and generate revenue for the organization. III\. Functions of Physical Treatment The functions of physical treatment contribute to the overall product value and customer satisfaction. They ensure product consistency, quality, and availability, while also enhancing the product\'s marketability, convenience, and protection throughout its lifecycle. These include the following. 1\. Standardization, Grading and Branding: Standardization involves establishing uniform specifications, features, and characteristics for products or services. It ensures consistency and quality across different batches or versions of a product. Standardization simplifies production processes, improves efficiency, and facilitates customer understanding and comparison. For example, standardized clothing sizes or standardized electrical plugs. Grading is the process of categorizing products based on quality, size, or other attributes. It allows customers to make informed choices by selecting products that meet their specific requirements. Branding, on the other hand, involves creating and promoting a unique brand identity for products or services. It helps differentiate offerings from competitors, establishes customer loyalty, and signifies a certain level of quality or value. 2\. Packaging: Packaging encompasses the design, materials, and presentation of products. It serves multiple functions such as protecting the product during transportation and storage, providing information to customers, and promoting the brand. Effective packaging enhances product visibility, appeal, and convenience, contributing to customer satisfaction and brand recognition. 3\. Storage: Storage involves the proper management and preservation of products before they are sold or consumed. It includes activities such as inventory management, stock rotation, and maintaining suitable storage conditions (e.g., temperature control for perishable goods). Efficient storage practices ensure product availability, minimize spoilage or damage, and support timely order fulfilment. 4\. Transportation: Transportation refers to the physical movement of products from one location to another, such as from manufacturing facilities to distribution centres or retailers. It includes selecting appropriate transportation modes (e.g., trucks, ships, planes) and optimizing logistics to ensure timely and cost-effective delivery. Efficient transportation is crucial for maintaining supply chain flow, meeting customer demands, and minimizing transit-related risks or delays. IV\. Functions that Facilitate Exchange These functions work to facilitate the exchange of products or services between businesses and customers and the overall achievement of marketing goals. 1\. Advertising: Advertising involves the use of various media channels and communication tools to promote products, services, or brands to a target audience. It aims to create awareness, generate interest, and influence consumer behaviour. Advertising helps businesses reach a wide audience, build brand recognition, communicate product benefits, and persuade customers to make purchasing decisions. 2\. Personal Selling: Personal selling is a direct communication process between a salesperson and a prospective customer. It involves building relationships, understanding customer needs, presenting products or services, addressing concerns, and closing sales. Personal selling allows for personalized interactions, tailored product recommendations, and the ability to address specific customer inquiries or objections. 3\. Pricing: Pricing refers to the process of determining the monetary value assigned to a product or service. It involves considering factors such as production costs, competitor pricing, market demand, and perceived value of the product. Pricing strategies can vary, such as penetration pricing, premium pricing, or value-based pricing. Effective pricing strategies ensure that the price reflects the product\'s value proposition while remaining competitive in the market. 4\. Financing: Financing involves providing customers with payment options or assistance in acquiring products or services. This can include offering credit terms, instalment plans, or financing options through partnerships with financial institutions. By facilitating customer financing, businesses can overcome financial barriers and enable customers to afford their offerings, ultimately increasing sales. 5\. Risk-Taking: Risk-taking refers to the willingness of businesses to assume uncertainties and potential losses in pursuit of opportunities. This involves launching new products, entering new markets, or adopting innovative marketing strategies. Risk-taking is essential for growth and competitiveness, as it allows businesses to seize opportunities, adapt to market changes, and differentiate themselves from competitors. NOTE Selling is sometimes erroneously thought to be the same as marketing. However, selling is only a part of marketing (one of the functions of marketing). Also, selling is not the most important part of marketing. It is only the tip of the marketing iceberg. According to Peter Drucker, \"There will always, one can assume, be need for some selling. But the aim of marketing is to make selling superfluous. The aim of marketing is to know and understand the customer so well that the product or service fits him and sells itself. Ideally, marketing should result in a customer who is ready to buy\" IMPORTANCE OF MARKETING Marketing is important not only for businesses, but also for the consumers and the society in general. 1\. Importance to Businesses Marketing is of paramount importance to businesses for several reasons. 1\. Customer Satisfaction and Retention: Effective marketing strategies help businesses understand customer needs and preferences, enabling them to develop products and services that satisfy those demands. By delivering value to customers, businesses can enhance customer satisfaction, build long-term relationships, and foster customer loyalty. Satisfied and loyal customers often become repeat customers and advocates, contributing to sustainable business growth. 2\. Increased Sales and Revenue: Marketing activities such as advertising, promotions, and sales efforts help generate awareness, attract new customers, and drive sales. Through targeted marketing campaigns and effective communication, businesses can effectively promote their offerings, differentiate themselves from competitors, and ultimately increase sales and revenue. 3\. Market Expansion and Growth: Marketing enables businesses to identify new market opportunities and expand their customer base. By conducting market research, businesses can uncover unmet customer needs, emerging trends, or untapped segments. This allows them to develop strategies to enter new markets, introduce new products, or target specific customer segments, facilitating business growth and diversification. 4\. Competitive Advantage: Marketing plays a crucial role in establishing a competitive advantage for businesses. By conducting competitive analysis and understanding market dynamics, businesses can position their offerings effectively, highlight unique selling propositions, and differentiate themselves from competitors. This allows businesses to stand out in the market, attract customers, and create a sustainable competitive edge. Brand Building and Reputation Management: Marketing activities such as branding, advertising, and public relations contribute to brand building and reputation management. A strong brand enhances customer trust, credibility, and recognition. It helps businesses establish an emotional connection with customers and differentiate its offerings from competitors. Positive brand reputation attracts customers, drives sales, and supports long- term business success. 6\. Innovation and adaptability 7.7. Return on Investment (ROI): Effective marketing strategies are designed to yield a positive return on investment. By allocating resources efficiently, targeting the right audience, and tracking marketing performance, businesses can measure the effectiveness of their marketing efforts. This allows businesses to make data-driven decisions, optimize marketing campaigns, and allocate resources to the most impactful activities, ultimately maximizing ROI. Thus, marketing is essential for businesses as it drives customer satisfaction, sales, revenue growth, market expansion, competitive advantage, brand building, and innovation. It helps businesses understand and meet customer needs, differentiate themselves in the market, and build long-term relationships with customers. By investing in marketing activities, businesses can achieve their business goals, sustain growth, and thrive in competitive markets. II\. Importance to Consumers Marketing plays a crucial role in providing consumers with information, satisfying their needs and wants, and offering them a wider array of choices. 1\. Satisfaction of Consumer Needs and Wants: Marketing contributes to the satisfaction of consumer needs and wants. By identifying consumer demands and market trends, marketers can develop and offer products and services that align with those desires. Through market research and analysis, marketers can gain insights into consumer preferences, allowing them to create tailored offerings that address specific needs. This leads to higher customer satisfaction and an improved standard of living as consumers can access products that cater to their desires. 2\. Providing Information and Educating the Consumers: Marketing serves as a vital source of information for consumers. Through various channels such as advertisements personal selling, product descriptions, and reviews, marketing enables individuals to gather knowledge about different products and services. Marketing also educates the consumers about varied product uses, prices at which they are available (consider the ad for Veet wax strips here), distribution outlets and also about consumer rights (for instance, through Jaago Grahak Jaago campaign). This information empowers consumers to make informed decisions based on their preferences, budget, and specific requirements. Moreover, marketing campaigns often highlight the features, benefits, and unique selling propositions of products, enabling consumers to understand how they can fulfil their needs and desires. 3\. Wider Choice: Marketing provides consumers with a wider choice of products and services. Through branding, advertising, and promotional activities, marketers create awareness about the diverse range of options available in the market. This healthy competition encourages companies to innovate and differentiate their offerings, ultimately benefiting the consumers. The availability of multiple choices allows individuals to find products that best suit their preferences, budget, and individuality. It promotes a market environment where consumers are not limited to a few options but can explore and select from a plethora of alternatives, thereby enhancing their overall quality of life. III\. Importance to Society 1\. Wide Employment Opportunities: Marketing helps in generating wide employment opportunities by creating demand for products and services, leading to the growth of businesses across various sectors. This expansion requires professionals in marketing research, advertising, sales, public relations, digital marketing, content creation, graphic design, and customer service, among others, resulting in a diverse range of job opportunities. 2\. Improved Standard of Living: Marketing plays a crucial role in improving people\'s standard of living by promoting innovative products and services. Through effective advertising and communication, marketing helps consumers discover and access Products that enhance their quality of life. It also fosters competition, leading to improved products, affordability, and greater consumer choice. 3\. Economic Development: ent: By connecting businesses with consumers, marketing fuele economic development through increased production, consumption, and resouces utilization. Effective marketing strategies drive demand for products and services, resulting in increased production to meet consumer needs. This leads to job creation, improved productivity, and higher GDP. Marketing also plays a role in expanding consumption by influencing purchasing decisions and promoting economic activity. Additionally, marketing efforts help identify and tap into untapped resources and markets, facilitating their utilization and contributing to economic growth. 4\. Helps to Solve Social Problems: Marketing plays a significant role in addressing and solving social problems by raising awareness, changing attitudes, promoting positive behaviours, and mobilizing communities. Several Indian social marketing campaigns have effectively utilized marketing strategies like mass media campaigns, celebrity endorsements, and community outreach programs, to bring about social change. Some examples include the Swachh Bharat Abhiyan (Clean India Campaign) which, aimed to address the issue of poor sanitation and promote cleanliness, Beti Bachao, Beti Padhao (Save the Girl Child, Educate the Girl Child) which focuses on addressing gender inequality and female foeticide, Dettol\'s Banega Swachh India, which focused on promoting hygiene practices and reducing the incidence of preventable diseases and Dove\'s Stop the Beauty Test M campaign that aims to challenge harmful beauty standards and to promote body positivity 5. Environmental Sustainability: Marketing can promote and encourage environmentally sustainable practices. By highlighting eco-friendly products, sustainable manufacturing processes, and responsible consumption, marketing campaigns contribute to raising awareness about environmental issues and encouraging positive behavioural change. Marketing can encourage businesses and consumers to adopt environmentally friendly practices, ultimately leading to a more sustainable society For instance, Ocean beverages have been promoting \'Ocean Energy Drink Sustainable Edition\' cans that can be recycled, as a part of their sustainability initiatives. MARKETING PHILOSOPHIES/ MARKETING CONCEPTS Marketing philosophies refer to the fundamental beliefs and approaches that guide an organization\'s marketing efforts. These philosophies shape the overall marketing strategy. Influencing decisions on product development, target markets, customer relationships, and promotional activities. Several key marketing philosophies have emerged over time, reflecting different perspectives on how businesses should approach the market. These marketing philosophies have given rise to the different marketing concepts. These marketing concepts that have emerged over a period of time are - 1\. The production concept. 2\. The product concept, 3\. The selling concept, 4\. The marketing concept. 5\. The societal marketing concept, and 6\. The holistic marketing concept 1\. The Production Concept The production concept is one of the oldest concepts in business. This philosophy focuses on efficient production and wide distribution of low-cost products. Companies following the production concept strive to minimize production costs at every stage of the supply chain. They seek ways to streamline production processes, optimize resource allocation, and achieve economies of scale. This emphasis on cost reduction helps keep prices low and ensures profitability even with large production volumes. Assumption: The production concept assumes that consumers will favour those products that are widely available and low in cost. Thus, under this concept, companies prioritize affordability and availability over specific product features or customization. Consequently, companies adopting this concept may overlook the importance of understanding consumer needs and preferences in-depth. Example: Henry Ford\'s Model T- Henry Ford revolutionized the automotive industry by implementing the production concept. He introduced the assembly line and mass production techniques, which significantly increased the efficiency and lowered the cost of producing automobiles. By streamlining production processes, optimizing supply chains, and utilizing economies of scale, Ford was able to reduce the price of the Model T significantly. As a result, the Model T became one of the most affordable automobiles available, making car ownership a reality for many Americans. II\. The Product Concept The product concept of marketing focuses on developing and offering superior products that offer the most quality, performance or innovative features. Companies adopting this approach invest heavily in research and development to create innovative products that set them apart from competitors. Assumption: The product concept assumes that consumers will prefer products with superior features, performance, or unique attributes. Example: Apple is a prominent example of a company that embodies the product concept. They consistently focus on producing innovative and high-quality devices, such as iPhones, MacBooks, and iPads. Apple\'s commitment to design, performance, and user experience has helped them build a loyal customer base that values their products\' superior quality. Critics point out that while the product concept emphasizes the importance of product excellence, it is essential for companies to also consider other factors such as customer preferences, market dynamics, and pricing strategies. Companies that solely focus on product features without adequately addressing customer needs and preferences may face challenges in meeting market demands and achieving sustainable success. For instance, the Reva car was first introduced in India in 2001 as India\'s first zero polluting electric vehicle. Though it was an innovation that promised quality (a Mahindra product) and performance, the market was not ready for the electric cars at that point of time, and thus, inspite of being an innovative product, it failed Thus, in case of the product concept or the product orientation, customer needs are not considered. These organisations trust that their engineers will know how to design the innovative product. Here, marketing management becomes a victim of the \"better-mousetrap fallacy. The product concept also leads to \"marketing myopia\". (Read about these concepts below). Better Mousetrap Fallacy The Better Mousetrap Fallacy refers to the mistaken belief that creating a superior product or solution will automatically lead to success in the market. It assumes that if someone builds a better mousetrap (innovative, seemingly attractive product), they will catch the mouse (customer!). However, this fallacy overlooks the importance of other critical marketing factors. One notable example related to Google is Google+. Launched in 2011, Google+ was positioned as a social networking platform intended to compete with Facebook. Despite Google\'s reputation and resources, Google+ failed to gain significant traction and ultimately shut down in 2019! Despite offering some unique features, Google+ faced challenges such as a late entry into the social networking market, difficulties in attracting and engaging users, and a lack of differentiation from existing platforms like Facebook. Despite Google\'s efforts to create a superior product, it did not automatically translate into success in the social media landscape. These examples (Google+, Reva car) highlight that product superiority alone does not guarantee market success. Factors such as pricing, distribution, marketing strategies, customer preferences, competitive landscape, and overall customer experience play vital roles. A comprehensive approach that considers these factors is necessary to achieve sustainable success in the market. The Better Mousetrap Fallacy serves as a reminder that focusing solely on product superiority without addressing these essential marketing elements can lead to failure in the marketplace. Marketing Myopia \'Myopia\' is a medical term for short-sightedness, that is, narrow and restricted range of vision. In 1960, Prof. Theodore Levitt related the term \'myopia\' to \'marketing\' and came out with a new term \'Marketing Myopia\' to explain the short-sighted policies and practices of some business firms. When a company suffers from marketing myopia, it tends to define its business too narrowly, leading to a limited understanding of customer preferences and market trends. Instead of focusing on satisfying customer needs, it becomes fixated on selling specific products or services within its industry. This shortsightedness can hinder long-term growth and success. One classic example of marketing myopia is the downfall of the railroad industry. Levitt highlighted how railroads failed to recognize that they were in the transportation business (broader view), rather than just the railroad business (narrow definition of business). They overlooked the rise of other modes of transportation like automobiles, trucks, and airplanes, which ultimately disrupted the industry. By narrowly defining themselves as railroad companies, they missed the opportunity to adapt and meet the evolving transportation needs of customers. To avoid marketing myopia, organizations must maintain a forward-looking approach, continuously monitor market dynamics, and be willing to adapt their strategies and offerings accordingly. By staying customer-focused and open to innovation, companies can remain competitive in a rapidly evolving business landscape and ensure their long-term success. Food for thought-How should a company in the television manufacturing business define its business? We are in the TV manufacturing business or We work in the entertainment industry. III\. The Selling Concept The selling concept holds that consumers, if left alone, will ordinarily not buy enough of the organisation\'s products. The organisation must, therefore, undertake an aggressive selling and promotion effort. Assumption: The selling concept assumes that consumers will not purchase a product unless they are persuaded through aggressive selling techniques Companies adopting this approach often employ high-pressure sales tactics and extensive promotional campaigns to convince consumers to buy their products. This approach places a strong emphasis on aggressive selling techniques and persuasive communication to convince customers to make a purchase. The selling concept assumes that customers are reluctant to buy and need to be influenced or convinced to do so. Example: In the past, Encyclopedia Britannica relied heavily on the selling concept. They believed that the vast amount of information contained in their encyclopedias was valuable, and they utilized door-to-door salespeople to persuade families to invest in these expensive reference books. The company focused on convincing potential customers that owning their encyclopedias was essential for education and knowledge, even if customers had not considered purchasing them before. However, now, with the advent of the internet, information has become readily accessible online for free. People can search for and find information on various subjects quickly and easily, using search engines and online resources. The demand for physical encyclopaedias has decreased as a result. The selling concept is practiced most aggressively with unsought goods, which the buyers do not generally think of buying, such as, insurance (or encyclopedias, as discussed earlier). (Exercise - Do a quick Google search to find the percentage of people having a life insurance policy in India. Do you realise that this is an unsought good in India?) Example: Insurance companies often employ the selling concept to sell insurance policies. Insurance agents engage in persuasive selling techniques, addressing customers\' concerns about the risks and benefits of insurance coverage. They emphasize the importance of protection and the potential consequences of not having adequate coverage to overcome customer resistance. Promotional campaigns of insurance companies also use persuasive communication messages. The selling concept assumes that customers who are coaxed into buying the product will like it, and if they don\'t, they won\'t bad-mouth the product it or complain about it to customer organisations. And they will possibly forget their disappointment and buy the product again. Obviously, these assumptions about buyers are not realistic. In the present digital age, where almost every customer has a social media presence, customers are pretty vocal about any deficiencies in products or services and any kind of backlash can backfire on the companies that also have an image to maintain. Thus, practicing selling concept may get you short-term benefits in terms of sales through hard selling, but ultimately it will lead to customer dis-satisfaction if he/she does not need the product or does not like the product, and thus, is not in the long-term interest of the firm. It is because of this reason that marketing strategies for unsought goods, like insurance, are now designed differently. For instance, instead of relying on aggressive selling, their promotional campaigns are now having a different tone - talking about customer benefits of buying an insurance policy, and interesting story line IV\. The Marketing Concept The marketing concept is a philosophy that challenged the production concept, the product concept and the selling concept. The marketing concept of marketing is a customer-centric approach that focuses on identifying and fulfilling customer needs and wants. The marketing concept goes beyond product features and selling tactics and emphasizes building long-term customer relationships. Assumption: \"The marketing concept assumes that the key to achieving organisational goals consists of being more effective than competitors in integrating marketing activities towards determining the needs and wants of the target market.\" (Philip Kotler) The marketing concept rests on the following pillars. 1\. Target Market: Companies need to identify their target market and carefully prepare a tailored marketing programme to reach their target market. 2\. Customer Needs: The marketing concept is a customer-centric approach that emphasizes understanding and fulfilling customer needs and wants. It revolves around the idea that businesses should align their strategies, products, and services with customer needs and preferences to achieve long-term success. 3\. Integrated Marketing: When all the departments of a company work together to serve the customer\'s interests, the result is integrated marketing. Integrated marketing works at two levels first, the various functions of marketing (marketing research, product designing, advertising, etc.) must work together. Second, marketing department must be well coordinated with other departments of the organisation 4\. Long-term Profitability: The aim should be to achieve profits through customer satisfaction. Building and maintaining long-term relationships with customers is a crucial aspect of the marketing concept. Long-term profitability can be achieved by a business that places a strong emphasis on meeting the needs of its consumers, ensuring their satisfaction, and developing relationships with them. Example of Marketing Concept The e-commerce company, Amazon, was quick to adopt the marketing concept in its approach to business. amazon amazon Intra DIF Acc ord und On goa tow Ad 2 3. Image Source: https://sensortower.com/blog/amazon-q4-2015-growth Customer Orientation: Amazon is renowned for its customer-centric approach. The company places a strong emphasis on understanding its customers\' preferences. behaviours, and needs. Through data analysis and sophisticated algorithms, Amazon gathers insights about each customer\'s browsing and purchasing patterns, enabling the company to offer personalized recommendations and experiences. Integrated Marketing: Amazon\'s marketing efforts are integrated across various channels and touchpoints. From its website to mobile apps, email campaigns, and advertising, Amazon maintains a consistent message and user experience. Product information, user reviews, and related products are strategically placed to guide customers through the purchase journey. Profitability: By meeting customer needs and providing a seamless shopping experience, the company has gained a vast customer base and achieved significant profitability. The repeat business from satisfied customers, along with the expansion of its product and service offerings, has also contributed to Amazon\'s sustained growth and financial performance. Long-Term Perspective: Amazon\'s focus on building long-term customer relationships is evident through its commitment to satisfaction and loyalty. The company prioritizes customer feedback and continuously iterates on its offerings based on this input. This approach not only drives repeat business but also fosters a strong sense of loyalty among its customers. Amazon has also quickly moved towards a more holistic way of doing business by adopting the holistic marketing approach. V. The Societal Marketing Concept The Marketing concept lays emphasis on meeting the customer needs. Food for thought Are companies which succeed in satisfying customer needs necessarily acting in the long-term interests of consumers and society? Consider this The detergent industry though satisfying the need for whiter and cleaner clothes (satisfying customers) may pollute rivers and kill sea life like fishes etc. (due to chemicals added in the detergent), thus, does not act in the long-term interest of the society. Such considerations called for a new concept that enlarges the marketing concept, and thus, came the societal marketing concept. Assumption: The societal marketing concept holds that \"the organisation\'s task is to determine the needs, wants and interests of target markets and to deliver the desired satisfactions more effectively and efficiently than competitors in a way that preserves or enhances the consumers\' and society\'s well-being.\" (Philip Kotler) Example: Fruit juices packed in tetra packs do not need adding of any preservatives (consumer\'s well-being). These tetra packs are also easily disposable and more environment friendly (Society\'s well-being). However, with time, it was realised that businesses do not only have a responsibility towards their customers and the society, but to many other stakeholders. Thus, came the Holistic Marketing Concept, that it an all inclusive concept in terms of the market orientation of business firms, and should ideally be the concept with which the businesses should be working with. VI\. The Holistic Marketing Concept The marketing concept laid emphasis on the customer and customer needs. The societal marketing concept broadened the concept by adding the interest of the society along with the customers. The holistic marketing concept goes a step ahead in broadening this even further by emphasising that \"everything matters\" in marketing be it your customers, employees, marketing partners, internal management, departments, all marketing activities and activities of other departments, revenue, brand equity, legal compliances, ethical considerations, society or the community and the environment - everything matters! Thus, the foundation of the holistic marketing idea is the creation, planning, and execution of marketing processes, activities, and programmes that take into account their interdependencies. Holistic marketing recognises that \"everything matters\" in regards to marketing and that it is important to have a broad perspective in this regard. The four broad components that characterize holistic marketing are shown in the figure1.1 and are explained below. 1\. Relationship Marketing: \"Relationship marketing aims to build mutually satisfying long- term relationships with key constituents in order to earn and retain their business. Customers, employees, marketing partners (channels, suppliers, distributors, dealers, agencies), and members of the financial community (shareholders, investors, analysts) are the four key constituents for relationship marketing\". Marketers must foster prosperity among all these constituents and balance the returns to all key stakeholder groups. 2\. Integrated Marketing. Various activities of marketing must work together. All company communications also must be well-coordinated and integrated. For instance, using an integrated communication strategy entails selecting communication channels that support and enhance one another. A marketer may use PR and website communications, public relations and events, television, radio, and print advertising strategically so that each adds to the overall success of the campaign while also boosting the efficacy of the others. Each of these must additionally provide a consistent brand message during every interaction. Similarly, the company must also develop an integrated channel strategy. 3\. Internal Marketing: Hiring, educating, and motivating competent workers who desire to provide excellent customer service is the task of internal marketing, a component of holistic marketing. It makes sure that everyone in the company, especially top management, embraces appropriate marketing principles Also, marketing is now a company-wide responsibility that drives the organization\'s vision, objective, and strategic planning rather of being the sole purview of one department. Only when all departments collaborate to meet customer goals does it succeed. For instance, when engineering creates the appropriate products, finarice provides the appropriate level of money, purchasing purchases the appropriate materials, manufacturing creates the right products within the appropriate time frame, and accounting measures profitability in the appropriate methods. However, such departmental harmony can only genuinely materialise when management presents a clear picture of how the organization\'s marketing approach and philosophy should aim to help customers. 4\. Performance Marketing: Understanding the financial and non-financial benefits from marketing activities and programs to businesses and society is necessary for performance marketing. Top marketers are increasingly looking at the marketing scorecard to analyse trends in market share, customer loss rate, customer satisfaction, product quality, and other metrics in addition to sales revenue, as all of these are reflective of an organisation\'s performance. Additionally, they are taking into account how marketing activities and programs may affect the law, ethics, the community, and the environment. For instance, performance marketing may involve giving back to the community and many companies are trying to achieve the same through their social marketing objectives. To take an example, Marketing Insight 1.1 explains how \'The Shower\" ad by Hindustan Unilever under its \"Start A Little Good\" campaign seeks to remind us about the value of water and the urgency of saving it to sustain life. Performance marketing may also include the sustainability initiatives of a company or even an attempt to break the stereotypes existing in a society as a part of its social responsibility initiatives. ETHICAL ISSUES IN MARKETING Marketing ethics are paramount in maintaining trust and integrity between businesses and consumers. Ethical marketing prevents deceptive practices, safeguarding consumers from harm, and contributes to long-term brand reputation and customer loyalty. Consumers are more likely to support companies that demonstrate responsible behaviour. Marketing practices often raise several ethical issues that companies and marketers must address to maintain consumer trust and uphold societal values. These ethical issues are discussed below. 1\. One of the ethical issues in marketing is deceptive advertising. Misleading claims or exaggerations about a product\'s benefits can deceive consumers and lead to dissatisfaction or harm. Such practices not only erode trust in the brand but can also harm consumers who make decisions based on inaccurate information. Thus, marketers must prioritize honesty and transparency to build long-term relationships with customers. In 2008, Gillette India Ltd. Came out with an ad for the Victor Plus Blade, where the Voice Over (VO) stated, \"blade lasts for three weeks,\" and the small print stated, \"on the basis of one shave every three days.\" A complaint was filed against the advertisement claiming that the consumer was misled into thinking the blade lasted for 21 shaves when in fact it only lasted for 7. Fine print appeared on the screen for a short time, so one could not read it fully. The television commercial had to be withdrawn when the Advertising Standards Council of India (ASCI) ruled that the advertisement was misleading. An ad by Reckitt Benckiser (India) Pvt. Ltd., for its product Veet Wax Strips, in 2017, claimed, \"Removes the shortest hair that salon wax cannot, and the disclaimer stated \"Effective at removing even short (1.5mm) hair, basis clinical study performed under dermatological control\". The Advertising Standards Council of India (ASCI) held that the advertisement was misleading by omission of a disclaimer to qualify that the test is based on opinion survey of salon experts 2\. Another ethical concern is targeting vulnerable populations. Marketers must be cautious about targeting children, the elderly, or other vulnerable groups with manipulative tactics or products that may harm them. It is essential to maintain ethical guidelines while promoting products to these segments to protect their well-being and best interests. For instance, ads offering Chota Bheem\' goodies on purchase of certain products/ brands, would influence the children and tempt them to buy those products/brands. Get a chance to feature on TV with Image Source: https://www.maalfreekaa.in/2016/05/chhota bheem- contest.html 135 To take another example, in one of the ads for Cadbury Fruity Gems, a child was shown eating fruits and another child eating Cadbury Fruity Gems In the end, the child eating fruits is shown eating Cadbury Fruity Gems instead of fruits. A complaint against this ad was filed by the father of an six-year old kid saying that his daughter now wanted to eat only Cadbury Fruity Gems, and not fruits. The Advertising Standards Council of India (ASCI) held that the ad exploits the vulnerability of minors. 3\. Price increases/hoarding of goods during times of crisis or exploiting consumer vulnerabilities for profit raises ethical concerns. Marketers should refrain from engaging in such practices, maintaining fair and just pricing strategies. 4\. The distribution of counterfeit or unauthorized products through unauthorized channels can harm consumers, damage brand reputation, and infringe on intellectual property rights. Companies should take measures to prevent such practices. 5\. Ethical concerns arise when marketing campaigns promote harmful stereotypes or fail to represent diverse populations accurately. Marketing campaigns that perpetuate harmful stereotypes or lack diversity can negatively impact brand reputation. Moreover, in the age of social media and heightened awareness of social issues, consumers are quick to call out and boycott companies that engage in unethical marketing practices. Negative publicity can severely damage a brand\'s image, leading to loss of tr credibility. For instance, scan this QR Code to see this ad by ING Vysya Life \[ Insurance Company Ltd., which presented the girl child as a burden. A complaint was filed with the Advertising Standards Council of India (ASCI) which said that the \"advertisement is anti-girl child and deeply offensive to all the females, giving the message that they are nothing more than burdens.\" (Source: https://www.ascionline.in/) On the other hand, inclusive and diverse marketing campaigns resonate with consumers, fostering loyalty and brand advocacy. Thus, marketers should for inclusive and diverse representations in their advertising. Consider Marketing Insight 1.3 that discusses an attempt by Dove to challenge the narrow and restrictive beauty standards imposed on Indian women. 6\. Sustainability and environmental impact are also critical ethical considerations in marketing. As consumers become more environmentally conscious, they expect companies to take responsibility for their ecological footprint. Greenwashing, a practice where companies exaggerate or falsely claim their environmental efforts, can lead to consumer skepticism and damage brand reputation. For example, in 2015, Volkswagen faced a major scandal known as \"Dieselgate\". The company was caught using software in its diesel vehicles to cheat emissions tests, making the cars appear more environmentally friendly than they actually were. This deceitful practice allowed VW to market their diesel vehicles as \"clean\" and \"eco-friendly\" while they were emitting pollutants far beyond regulatory limits. The scandal had severe consequences for the company, resulting in fines, legal actions, and significant damage to its reputation. Similarly, in 2015, manufacturer Kimberly-Clark, the manufacturer of Huggies disposable diaper launched their \"pure and natural\" line of diapers, which it positioned as a \"super-premium diaper that includes natural, organic materials and ingredients to provide gentle protection for new babies as well as preliminary steps towards environmental improvements, without sacrificing performance.\" Later, customers filed a case against the manufacturer, alleging that the company had deceived the organic materials and possibly dangerous components like sodium polyacry polypropylene were used to make the diaper, thus, they are neither pure nor natural. (Reference:https://www.livemint.com/Industry/fEpJY11xlB743YIqBZ55uK/VW- scandal-puts-greenwashing-in-the-spotlight.html). To read more about such greenwashing practices of companies, scan this QR code. Ethical marketing requires genuine commitment to sustainability and responsible consumption, as well as transparency in communicating these efforts. This not enhances the brand\'s reputation but also contributes to a more sustainable The Body Shop, a cosmetics and skincare company, incorporates \'sustainability\' as an important part of \'performance marketing\' under its holistic marketing strategy. The Body Shop promotes ethical sourcing, fair trade practices, and environmental sustainability. They actively campaign against animal testing and engage in various initiatives to support communities and social causes. The Body Shop\'s commitment to social responsibility has helped differentiate their brand and socially conscious customers. Scan this QR Code to see how The Body Shop attempts to reduce and recycle the packaging waste. 7\. Cultural sensitivity is essential in marketing, especially in diverse markets. Insensitive or offensive marketing messages can damage a brand\'s reputation and hurt cultural sentiments. Ethical marketers should conduct thorough research and ensure their campaigns respect diverse cultural norms and values. For instance, consider this Levis jeans ad featuring Kangana Ranaut. A complaint was filed against this ad as this shows a lot of nudity which is unacceptable in the Indian society and thus, is considered offensive, against the societal norms and hurts the sentiments of people Privacy and data protection are significant ethical issues in modern marketing. As companies collect vast amounts of consumer data, there is a responsibility to protect that information and use it responsibly. Marketers must obtain explicit consent from individuals before collecting their data and should refrain from sharing or selling it without consent. Additionally, using personal information to manipulate consumers without their knowledge can be unethical. 10\. Social responsibility is a crucial ethical aspect of marketing. Companies must consider the broader impact of their marketing practices on society, including promoting responsible consumption and addressing societal issues positively. Engaging in socially responsible marketing initiatives can build consumer trust and loyalty. Consider here Marketing Insight 1.1 (given earlier in the chapter) that explains how \"The Shower\" ad by Hindustan Unilever under its \"Start A Little Good\" campaign seeks to remind us about the value of water and the urgency of saving it to sustain life. CONCLUDING NOTE Marketing is a dynamic and multifaceted discipline that plays an important role in bridging the gap between businesses and consumers, creating value exchanges. At its core, marketing is about understanding customers\' needs and wants, and strategically positioning offerings to meeting those demands effectively. In today\'s digital age, technology has revolutionized marketing by offering innovative tools and platforms to reach global audiences. As such, marketers must stay up to date with the latest trends and leverage data-driven insights to make informed decisions and achieve measurable results. Marketing ethics are paramount in maintaining trust and integrity between businesses and consumers. Ethical marketing prevents deceptive practices, safeguarding consumers from harm. It also contributes to long-term brand reputation and customer loyalty, as consumers are more likely to support companies that demonstrate responsible behaviour. By considering societal and environmental impacts, ethical marketing aligns with broader social values and contributes to sustainable business practices.