Intro of Marketing
The American Marketing Association offers the following formal definition: Marketing is the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large.
Peter Drucker: 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.
Kotler: We see marketing management as the art and science of choosing target markets and getting, keeping and growing customers through creating, delivering and communicating superior customer value. He is also known as father of modern marketing.
What to market
Marketers market 10 main types of entities:
Goods (Tangible nature, Physical goods constitute the bulk of most countries’ production and marketing efforts)
Services (Services include airlines, hotels, barbers and beauticians, maintenance and repair, accountants, bankers, lawyers, engineers, doctors, software programmers, and management consultants),
Events (trade shows, artistic performances, exhibitions and company anniversaries.),
Experiences (By giving several services and goods, a firm can create, stage, and market experiences like Amazon, Flip kart, a week at a baseball camp with retired baseball with retired baseball great),
Person (Artists, musicians, CEOs, physicians, high-profile lawyers and financiers, consultant, market researcher),
Places (Cities, states, regions, and whole nations compete to attract tourists, residents, factories, and company headquarters need marketing efforts),
Properties (Properties are intangible rights of ownership to either real property (real estate) or financial property (stocks and bonds)),
Organizations (Organizations work to build a strong, favorable, and unique image in the minds of their target publics),
Information (Information is essentially what books, schools, and universities produce, market, and distribute at a price to parents, students, and communities)
Ideas (in the drugstore we sell hope, Social marketers are busy promoting such ideas as “Friends Don’t Let Friends Drive Drunk, Take the Keys, Call a cab, Take a stand”)
Market-place, a physical place where buyers and sellers gathered to buy and sell goods and services.
Market-space is digital, as when you shop on the Internet
Meta-markets are the result of marketers packaging a system that simplifies carrying out these related product/service activities. The automobile meta-market consists of automobile manufacturers, new and used car dealers, financing companies, insurance companies, mechanics, spare parts dealers, service shops, auto magazines, classified auto ads in newspapers, and auto sites on the Internet.
Type of Market
Based on Structure:
1] Perfect Competition
In a perfect competition market structure, there are a large number of buyers and sellers. There is no one big seller with any significant influence on the market. So all the firms in such a market are price takers.
There are certain assumptions when discussing the perfect competition. This is the reason a perfect competition market is much theoretical concept. These assumptions are as follows,
- The products on the market are homogeneous, i.e. they are completely identical
- All firms only have the motive of profit maximization
- There is free entry and exit from the market, i.e. there are no barriers
- And there is no concept of consumer preference
2] Monopolistic Competition
This is a more realistic concept that actually exists in the real world. There are still a large number of buyers as well as sellers. But they all do not sell homogeneous products. The products are similar but all sellers sell slightly differentiated products.
Now the consumers have the preference of opting one product over another. The sellers can also charge a marginally higher price since they may enjoy some market power. So the sellers become the price setters up to a certain extent.
For example, the market for toothpaste, cosmetic items.
In an oligopoly, there are only a few firms in the market. While there is no clarity about the number of firms, 4-5 dominant firms are considered the norm. So in the case of an oligopoly, the buyers are far greater than the sellers.
The firms in this case either compete with another to collaborate together, they use their market influence to set the prices and in turn maximize their profits. Here the consumers become the price takers. In an oligopoly, there are various barriers like licensing to entry in the market, and new firms find it difficult to establish themselves.
In a monopoly type of market structure, there is only one seller and many buyers, so a single firm will control the entire market. It can set any price it wishes since it has all the market power. Consumers do not have any alternative and must pay the price set by the seller.
Monopolies are extremely undesirable. Here the consumer lose all their power, it led market forces become irrelevant. However, a pure monopoly is very rare in reality.
Based on Customers:
Consumer Market- mass consumer goods and services such as juices, air travel, cosmetics, athletic shoes, etc.
Business Market- goods to make or resell a product to others at a profit
Global Market- Companies in the global marketplace must decide which countries to enter (JVs, Acquisition)
Nonprofit and Governmental Markets- Companies selling to nonprofit organizations with limited purchasing power such as churches, universities, charitable organizations
Core Marketing Concepts
- Needs, Wants, and Demands
Needs are the basic human requirements such as for air, food, water, clothing, and shelter
- 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 navigation system.)
- Secret needs (The customer wants friends to see him or her as a savvy consumer.)
Demands are wants for specific products backed by an ability to pay
- Negative demand—Consumers dislike the product and may even pay to avoid it like vaccinations, dental work, etc.
- Nonexistent demand—Consumers may be unaware of or uninterested in the product like new farming methods, foreign language courses, etc.
- Latent demand—Consumers may share a strong need that cannot be satisfied by an existing product like demand of harmless cigarettes, more fuel efficient car, etc.
- Declining demand—Consumers begin to buy the product less frequently or not at all like Pvt colleges admission fall, Membership in clubs fall, etc.
Marketing Approach: creative remarketing
5. Irregular demand—Consumer purchases vary on a seasonal, monthly, weekly, daily, or even hourly basis like Diwali, Holi festival items.
Marketing Approach: Synchromarketing through flexible pricing or incentives.
6. Full demand—Consumers are adequately buying all products put into the marketplace.
7. Overfull demand—More consumers would like to buy the product than can be satisfied.
Marketing Approach: De-marketing/Selective de-marketing
8.Unwholesome demand—Consumers may be attracted to products that have undesirable social consequences through non-selling campaign.