Unit - I

Marketing Management Dr.Lt.
M Dhadurya Naik
MARKETING MANAGEMENT
UNIT 1- INTRODUCTION TO MARKETING
 Introduction to Marketing
 Concepts & evolution- Indian Marketing Environment-
 Role and functions of the Marketing Department;
 Market research: Concepts in demand- Market research –
 Forecasting and measurement – Market data analysis.
Introduction to Marketing
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Marketing Management Dr.Lt. M Dhadurya Naik
Marketing is dynamic and impactful. The details differ between industries, but at its most
basic marketing is how businesses reach prospective customers and communicate the
unique benefits of a product or service. It encompasses all the activities that companies
undertake to promote, sell, and distribute that product or service. The goal is to generate
sales and build a loyal customer base by informing prospective and existing buyers about
the offering.
Your target audience must first be aware that your product or service exists before you can
hope to inspire a purchase. An essential function in any business, marketing supports efforts
to acquire, keep, and grow customers.
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We use a large variety of goods and services in our daily life. These include items like
toothpaste, toothbrush, soap, oil, clothes, food items, telephone, electricity and many
more. How do all these goods and services reach our home? Obviously the business houses
who produce the goods and services have to ensure that these are to be sold, and so they have
to make the consumers/users aware of their products and place them at points convenient to
the consumers. This involves a number of activities such as product planning, pricing,
promotion, use of middlemen (wholesalers, retailer etc.) for sale, warehousing, transportation
etc. All these activities taken together are termed as Marketing.
Market and Marketing
In our study of the business world, we have often come across the terms market
and marketing. Both are similar sounding terms and relate to the same concept. However,
‘market’ and ‘marketing’ are two widely separate concepts individually that relate to each
other. Let us take a more detailed look at market and marketing.
Market
The market actually refers to a set up where potential buyers and sellers can meet to exchange
goods or services. It is basically a medium that facilitates these transactions in an economy. It
allows for the exchange of goods, services, information under the protection of the law and
generally in exchange for consideration.
Traditionally a market is a physical location or place, like a bazaar or a shopping mall. The
kind of market it is will depend on a lot of factors. Some of the ways in which we can
characterize markets are,
 According to the products being sold. Example: cotton market, iron market, share

market
 Based on geographical locations, like a local market or international market
 By the types of buyers involved, example: consumer market, industrial market etc
 The quantity of goods transacted between parties like a wholesale market or a retail

market
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Coca cola https://www.youtube.com/watch?v=LmWJCpwkcHk&t=40s
Coca Cola https://www.youtube.com/watch?v=5b18LXBpVDo
Marketing
Marketing is a very wide term. It includes all the activities involved right from the production
of the goods, until their consumption. Every activity in between, like designing, pricing,
promotion, distribution, transportation, warehousing etc are activities of marketing.
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.” — American Marketing Association
“Marketing is the social process by which individuals and groups obtain what they need and
want through creating and exchanging products and value with others.” — Philip Kotler
 Marketing is meeting the needs and wants of a consumer.

-Andrew Cohen
Professor Philip Kotler explained that marketing was “meeting the needs of your customer at
a profit.”
For me that definition extends beyond just communicating product features. Marketers are
responsible for a 360-degree experience. For example, in the social media world, a
customer’s Twitter needs may differ from her needs to “play with the brand” in terms of a
social game promotion. Every customer touchpoint from customer service to sales to
accounting and more are part of the “new marketing.” Toby Bloomberg – Bloomberg
Marketing/Diva Marketing
 Marketing is helping people buy your product or service.

-Jason Falls – Social Media Explorer
 Marketing is anything you create or share that tells your story.
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-Ann Handley
“Marketing is the process of anticipating, managing, and satisfying the demand for products,
services, and ideas.” — Wharton School, University of Pennsylvania
Note that the definitions make several points:
 A main objective of marketing is to create customer value.

 Marketing usually involves an exchange between buyers and sellers or
between other parties.
 Marketing has an impact on the firm, its suppliers, its customers, and others
affected by the firm’s choices.
 Marketing frequently involves enduring relationships between buyers,
sellers, and other parties.
 Processes involved include “creating, communicating, delivering, and
exchanging offerings.”
Important Features of Marketing
 Satisfy Needs and Wants: The main focus of all marketing activities is consumer
satisfaction. When a group of individuals (potential customers) express their needs, the
companies strive to satisfy these needs via marketing activities.
 Creating a Market Offering: Then the companies must dedicate their efforts to create
an ideal market offering based on their study of potential customers. This
product/service offered must try to fulfil all of the requirements of the potential customer
in a given market.
 Customer Value: The customers buying decisions will be greatly dependant on the
price of the product. It must satisfy their needs at the cost that they think is fair. So the
sellers must add value to the product and price it accordingly, so the customer is willing
and gets value for his price,
 Exchange Mechanism: Marketing is not a one-way process. The seller must satisfy
the needs of the buyer. And the buyer in an exchange must provide consideration for the
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goods/services, which can be money or something else. It must be an exchange

mechanism
Concepts of Marketing
There are 5 different concepts of marketing, each of which vary in the function that they deal
with. For example – production concept deals with production and selling concept deals with
selling. Each of the concept was developed as per the need of the market. As the market
changed, so did the concepts of marketing. And today, we have an opportunity to look at all 5
concepts of marketing and what they represent.
1. Production concept
2. Product concept
3. Selling concept
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4. Marketing concept
5. Societal marketing concept
The article lists out the concepts of marketing in a very brief manner. You can click on each
link to know more about each individual concept of marketing.
Production Concept– Customers will accept cheap and available product. In other words,
Consumers will favour products that are available and highly affordable”. This concept is one of
the oldest Marketing management orientations that guide sellers.
Companies adopting this orientation run a major risk of focusing too narrowly on their operations
and losing sight of the real objective.
Although; In some scenario ; the production concept is still a useful philosophy.
Lets take Production concept as example- You see in Amazon or retail stores; the market is
immerse with cheap products from china. Everything like the cheap plastic product,from China is
on your cart now.
The best example of the production concept is Vivo, the Chinese smartphone brand. Their
phones are available in almost every corner of the Asian market. You can walk in any
phone shop in Asia and can walk out with the latest and greatest smartphone from
Vivo.According to google About 134 million smartphones has been sold across India in the
year 2017.
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2 Product Concept–
The product thought holds that the customers can favor product that supply the foremost in

quality, performance and innovative options. Here; below this idea, Marketing strategies are
focused on making continuous product improvements.
Product quality and improvement are important parts of marketing strategies, sometime just
targeting on company products could also lead to marketing myopia .
For example; Suppose a company makes the most effective quality magnetic disk. however you

have to think that client will want a floppy disk or no?
Suppose a company makes the best quality Floppy disk. But a customer does need a floppy disk?
She or he desires one thing which will be wont to store the information. It will be achieved by a
USB Flash drive, SD memory cards, etc.So that the company mustn’t look to form the simplest
floppy. They must focus to satisfy the customer’s information storage desires.
one more example-why nokia products failed?
However, after 2007, Nokia failed to sense that trends were changing. It ignored the changing
demands and needs of the customers And there was another mistake. Nokia overestimated the
strength of its brand, and believed that even if it was late to the smartphone game it would be able
to catch up quickly.
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Product Concept example:- When you are going to Market and want to buy mobile phone, you
are thinking about which mobile phone is best and high quality ;i think apple will be on the top.
Their product are fantastic that they set industry trends and standards .These High -quality
products are expensive but people still buy and they get almost free advertisement from
independent reviews.
Apple
Apple is one of the world’s largest tech companies and it falls under the
category of top 5 tech companies of the world. iPhone, TV, Store, Music,
Videos, and iPad are some of the main products of Apple. The company
also follows the product concept by the focus on delivering a quality
product. The customer market of Apple doesn’t care about the price.
3.Selling Concept-The selling concept holds the idea- “consumers will not buy enough of the
companies products unless it undertakes a large-scale selling and marketing effort”.
The main focus is to sell what the company makes rather than making what the market wants.
Such an aggressive selling program carries very high risks.
In selling concept the marketer assumes that customers will be coaxed into buying the product
will like it, if they don’t like it or don’t satisfy with product or services, they will possibly forget
their disappointment and buy it again later. This is usually a very poor and costly assumption.
now we understand this concept with examples-Every saw an ad online or on TV commercial

that you almost can’t escape and hide from? The Selling Concept is in play.
Almost all companies in the end fall into this concept. “Mountain Dew” ads are hard to miss. If
people like Mountain Dew or not, that is arguable but you can see that PepsiCo is pushing it hard
using ads.
nearly all soft drinks and soda drinks go along with selling concept. These drinks have no health
benefits ( actually harm your health more), you can easily replace them with water ( the most
available substances in the earth).
And the soft drink companies know everything about it, and inspite of this they run ads 24×7, and
spending millions of dollars
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4.Marketing Concept-Here we understand this concept , marketing management takes a

“customer first” approach.Under the marketing concept, customer focus and value are the routes
to achieve sales and profits.The marketing concept is a customer-centered “sense and responds”
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philosophy. The aim is not to find the right customers for your product but to find the right
products for your customers.
now we are going to understand this concept with examples-
Restaurants and startup business have started to follow the marketing concept. now ,They trying
to understand the consumer and deliver the best product or service, which is better for the
customer and competition.
Dollar shave club is one of the best example that suit here , They changed the Men’s grooming
trade . They have understood that people are not satisfied with their previous grooming products
and their prices
Where other company’s grooming products will cost hundreds to buy for just one month. Now
,Dollar shave club start to charges a couple of bucks a month with higher quality products and
convenience of home delivery.
5.Societal Marketing-It can be defined as the Societal Marketing Concept puts

Human,comfort,health,happiness on top before profits and satisfying the wants.
The global warming panic button is pushed and a declaration is required in the way we use our
resources. So companies have started either fully or partially trying to apply the societal
marketing concept.
societal concept example-While large companies sometimes launch programs or products that
benefit society; nowadays it is hard to find a company that is fully committed socially.
We can see Adidas doing great thing as they continue to support Colin Kaepernick despite
pressure from various parties. Tesla is promising a big push for green energy with electric cars
and solar roof panels/tiles.
Evolution of Marketing Concept
This marketing philosophy has undergone a thorough and gradual change since the great
Industrial Revolution that took place during the latter-half of the 18th and first-half of the
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19th centuries. This gradual change can be traced under four periods and captions namely,
production orientation period, sales-orientation period, customer-orientation period and social
orientation period.
A correct understanding of marketing concept is fundamental to the study of modern

marketing and marketing management. In any walk of life, thinking precedes doing; the way
of thinking that determines the very course of action.
A ‘concept’ is a philosophy, an attitude, a course of thinking, an idea or a notion relating to

any aspect of divine and human creations. The philosophy of an organisation in the dynamic
realm of marketing is referred to as a ‘marketing concept.’ A concept is an orientation or a
philosophy;
Thus, marketing concept is the way of life in which all the resources of an organisation are
mobilized to create, stimulate and satisfy the consumer at a profit. It represents a distinct
philosophy of business and considers marketing more than a physical process.
Wherever this concept prevails, that marketing organisation is future oriented, customer
oriented, value oriented, profit oriented and applies modern management practices to all
sales, distribution and other marketing functions.
It is a managerial philosophy and organizational structure that centres on the desires of the
consumers.
It calls on the company, in essence, to make only “what it can sell. It, therefore, reserves the
right of reversing the logic of the past that the task of marketing is to sell what the firm
makes.
Following is the brief explanation of each philosophy and corresponding period:
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1. Production Orientation Philosophy:
Till 1930s, there prevailed a strong feeling that whenever a firm has a good product, it results
in automatic consumer response and that needed little or no promotional efforts. This
production-oriented marketing concept was built on “Good wine needs no push.” That is, if
the product is really good and the price is reasonable, there is no need for special marketing
efforts.
The assumptions of this concept are:
(i) Anything that can be produced can be sold,
(ii) The most important task of management is to keep the cost of production down.
(iii) A firm should produce only certain basic products.
This concept can be illustrated as under:
Under this concept, production is the starting point. The product acceptability occurs after the
product is produced.
2. Sales Orientation Philosophy
The failures of the production orientation philosophy of 1930s paved the way for change in
the outlook that was possible during 1940s. This reshaped philosophy was sales-orientation
that holds good to a certain extent even today.
It states that mere making available the best product is not enough; it is futile unless the firm
resorts to aggressive salesmanship.
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Effective sales-promotion, advertising and public- relations are of top importance. High
pressure salesmanship and heavy doses of advertising are a must to move the products of the
firm.
The essence of sales orientation philosophy is “Goods are not bought but sold.” The maker of
product must say that his product is best and he fails if he keeps mum.
The assumptions of this philosophy are:
(i) Producing the best possible product.
(ii) Finding the buyer for the product,
(iii) The management’s main task is to convince the buyers through high pressure tactics, if
necessary.
It can be illustrated as under:
The philosophy has been prevailing since 1940. It is more prevalent in selling all kinds of
insurance policies, consumer non-durables and consumer durable products, particularly the
status-symbols.
3. Customer Orientation Philosophy:
This philosophy was brought into play during 1950s and points out that the fundamental task
of business undertaking is to study and understand the needs, wants, desires and values of
potential consumers and produce the goods in the light of these findings so that consumer
specifications are met totally.
Here, the starting point is the customer rather than the product. The enterprise is to
commence with the consumer and end with the requisite product. It emphasizes the role of
marketing research well before the product is made available in the market place.
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The assumptions are:
1. The firm should produce only that product as desired by the consumer.
2. The management is to integrate all its activities in order to develop programmes to satisfy
the consumer wants.
3. The management is to be guided by ‘long-range profit goals’ rather than ‘quick sales.
It can be illustrated as under:
This means a radical change in the philosophy.
It meant two basic changes namely:
(i) Move from production to market-orientation,
(ii) Gradual shift from age old “Caveat emptor” to “Caveat vendor”.
Since 1950, this philosophy is in vogue and will continue so long as consumer is the King of
the market.
4. Social Orientation Philosophy
There has been a further refinement in the marketing concept particularly during 1970s and
1980s. Accordingly, the new concept goes beyond understanding the consumer needs and
matching the products accordingly.
This philosophy cares for not only consumer satisfaction but for consumer welfare or social
welfare. Such social welfare speaks of pollution-free environment and quality of human life.
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Thus, a firm manufacturing a pack of cigarettes for consumer must not only produce the best
cigarettes but pollution-free cigarettes; an automobile not only fuel efficient but less pollutant
one.
In other words, the firm is to discharge its social responsibilities. Thus, social welfare
becomes the added dimension.
The assumptions of social-orientation philosophy are:
(i) The firm is to produce only those products as are wanted by the consumers,
(ii) The firm is to be guided by long-term profit goals rather than quick sales.
(iii) The firm should discharge its social responsibilities,
(iv) The management is to integrate the firm’s resources and activities to develop programme
to meet these individual consumer and social needs.
This concept can be illustrated as under:
This social oriented philosophy is the latest and is considered as an integrated concept. This
philosophy, as it covers earlier long-standing concepts, is bound to rule the marketing world
for pretty long time.
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Evolution of Marketing
Following Robert Bartels, we may distinguish six different periods
in the history of marketing since its discovery between 1900 and
1910. Prior to 1900, market behaviour and trade practice were
explained mainly from macro-point in economic theory.
The period of discovery is a period in which the early teachers of the
subject sought facts about the distributive trades. In the process of
this search, theory was borrowed mainly from economics;
particularly in the fields of distribution, world trade and commodity
markets and the term marketing was selected to describe this
particular activity.
The years between 1910 and 1920 are characterized as a period of
conceptualization and in this era basic concepts on which the
structure of marketing thought was built for the next 40 or 50 years
emerged and were crystallized. It was during this period that many
marketing concepts were initially developed and classified and
terms defined. It was also during this time that three lines of
approach to the analysis of marketing were identified — the
institutional, the functional and the commodity approaches.
The next decade (1920-30) is characterized as a period of
integration. The years between 1920 and 1930 mark the coming of
age of the discipline of marketing. During that decade not only did
all the branches of the subject attain a general or integrated
statement but two additional areas of specialization appeared —
wholesaling and marketing research.
However, during the 1930s changes in social and economic

conditions had a marked effect moulding the direction of thinking
and practice in marketing with the result that the 1930s and 1940s
are described as a period of development. This phase is
characterized as one during which specialized areas of marketing
continued to be developed, hypothetical assumptions were verified
and quantified and some new approaches to the explanation of
marketing were undertaken.
The developments of the 30s laid the basis for the next decade —
typified as a period of reappraisal. By 1950 marketing thinking
encompassed an impressive array of content and techniques that
was short of concepts and lacked any general theory of marketing.
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It was with these latter issues that we have been concerned in the
second half of the 20th century commencing with period of
conceptualization (1950-60), the period during which traditional
approaches to the study of marketing were supplemented by
increasing emphasis upon managerial decision-making, the societal
aspects of marketing and quantitative marketing analysis. Many
new concepts borrowed from the field of management were
introduced into marketing.
The fact that marketing is virtually everywhere in today’s free-

market economies is a dramatic change from a few decades ago.
Marketing emerged as a discrete discipline in the early 1900s, but it
didn’t affect most companies right away. Many businesses went
through distinct phases on their way to becoming marketing
oriented.
(1) The Production Era:
The Industrial Revolution of the eighteenth century was the
beginning of the production era, which lasted until the late 1920s.
During this period, companies focused on the manufacturing
process. They looked for ways to produce their goods faster and
more efficiently.
The production era had sellers’ markets in many industries,
meaning that demand for products exceeded supply. During this
era, manufacturers could afford to focus on production because
demand was assured. Desire for their products was so strong, in fact
that they needed to streamline production methods just to meet
existing demand.
For example, Pillsbury’s production era started when the business
was founded in 1869. As a flour producer, Charles A. Pillsbury had
only two things on his mind back then – wheat and water power.
Production, not marketing, was his main concern. His orientation
was typical for the time, and it worked-for a while.
(2) The Sales Era:

The sales era followed on the heels of the production era and
extended from the 1930s into the 1950s. During the sales era,
manufacturers believed business success lay in outselling the
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competition. The question they asked was not “What does the
customer want?” but “How can we get them to buy what we make?”
Companies emphasised product promotion during the sales era, just
as they tried to improve manufacturing techniques during the
production era. Firms formed direct sales forces and established
relationships with dealers and other firms that could push their
products into the market. Advertising also took on new importance
during this time.
Pillsbury entered its sales era in the 1930s. In that decade and the
next, Pillsbury grew to appreciate both the grocers who sold its
products and the consumers who bought them. Realising it could
use information about customer likes and dislikes to create
advertising that would stimulate demand, the company formed a
research department to collect market data.
Also recognising the importance of strong relationships with
grocers, Pillsbury built on these relationships to assure a smooth
flow of Pillsbury products from the mill to the customer.
(3) The Marketing Era:
The 1950s were the start of the marketing era, during which
companies began to practice marketing in its current form. The
development of efficient production techniques earlier in the
century had laid the groundwork for plentiful supplies of most
products.
The outcome in many cases was a buyers’ market; that is, supply
overwhelmed demand. In a buyers’ market, you’ve got to do more
than just build things in order to succeed.
The method of achieving business success shifted from pushing
products on customers to finding out what buyers wanted and then
filling that need. The focus during the marketing era was not the
manufacturer’s goals, as in the first two eras, but customers’ needs
and wants. The new marketing departments formed in many
companies started trying to provide the goods and services that
customers desired.
Pillsbury’s marketing orientation grew during the 1950s, a decade in

which the firm learned to value customer opinions. Rather than
worrying about how much it could produce or sell, the company
focused on meeting customer needs and wants with new and
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enhanced products. During the 1950s, Pillsbury expanded its

advertising department into a marketing group responsible for
satisfying both current and future needs of customers.
The notion of marketing continued to evolve until businesspeople
began talking about the marketing concept. This concept stresses
not only customer needs and wants but also long-term profitability
and the integration of marketing with other functional units within
the organisation. The marketing concept came into existence in the
1960s and continues to develop and expand.
Evolution of Marketing – Evolution Process Charted

as Follows
If we attempt to trace the evolution of the approaches of marketing,
we will find that the concept has undergone a remarkable change
from its primitive barter system to the present-day management-
oriented approach to marketing.
The evolution process may be charted as follows:
1. Barter System:
It may be regarded as the initial beginning of the concept and
approach of marketing evolution process. Under this system, the
goods are exchanged against goods without any other medium of
exchange like money.
This system suffers from certain limitations or drawbacks
as follows:
(i) The method depends on one party to be able to satisfy another
party’s wants, which poses difficulties in most situations and
(ii) The method necessitates the determination of a rate of exchange
which is difficult to arrive at in m circumstances of the trade.
2. Production Orientation:
This approach was based on the assumption that whatever is
produced a o accepted by the customers or consumers. In other
words, the producer instead of being concerned with the consumer
preferences concentrates on the production of goods for the purpose
of profit realization. This approach was the outgrowth of the
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industrial revolution to produce goods on a mass scale in

anticipation of demand.
The drawbacks of this approach are:
(i) The interest of the consumer is virtually ignored to that of the
producer;
(ii) The marketing becomes either product-oriented or production-
oriented;
(iii) The stress is not on the consumption which is the ultimate
objective of industry and commerce; and
(iv) The marketing process comes to an end as soon as the products
reach the consumers.
3. Sales Orientation:
This approach, in the evolution of marketing, involves a deliberate
orientation towards the promotion of sale. Various socio-economic
factors, like shift from agriculture to industry, development of the
means of transport and communications, better living standards of
people, competition among the producers to reach out to
consumers, etc., have given birth to this approach.
In a word, it puts emphasis only on the increase of sales turnover
without any consideration of the production of the goods desired
the consumers. The selling activity becomes the dominant factor in
the marketing of goods in an environment of competition.
The major limitation of the system is that marketing becomes highly
sales-oriented without any efforts of the satisfaction of the
consumer needs.
4. Consumer/Customer Orientation:
This approach refers to the concept of marketing that is related to
the needs of the buyers. Under the system, only such products are
brought forward in the market, which are capable of satisfying the
tastes, preferences, and expectations of the consumers. This stage,
in the evolution process of marketing, ushered in a major
breakthrough in the outlook of the producers towards marketing.
This stage or phenomenon is characterized by the
following redeeming features:
(i) The production of goods far exceeds the demand;
(ii) The increased awareness of the consumers drives them to shift
from one product to another; and
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(iii) The producers realize the consumer demands and choices and
there-by, are forced to adopt consumer- oriented approach to
marketing, so that they can survive in the market.
At this stage, the marketing management strives to organize the
factors of production within the organization keeping in view the
factors of consumption outside. This approach, thus, aims at
consumer satisfaction by means of production or the right kind and
quality of products, in the right qualities, at the right price and in
the right market. The matching of products and services with the
markets and consumers becomes the motto of the consumer-
oriented approach to marketing.
5. Management Orientation:
This approach or concept can be said to be a natural consequence of
increasing attention to the consumer satisfaction. Marketing, under
this concept, is conceived of as a total management system of
interacting business activities designed to plan, promote, and
distribute want satisfying products and services to the existing and
potential consumers. In the present highly competitive and
changing world, the marketing factor has become very crucial to all
business planning and decision making.
The marketing function has now come to be associated with various
aspects like pricing, products, markets, market research and
analysis, advertising and sales promotion, field sales, distribution,
organization and staffing, and co-ordination with the
manufacturing and other operations. In all these areas, the
management has to develop and adopt procedures for planning,
organizing, directing, reviewing, controlling, etc.
In other words, the management has to harmonize all these variable
factors, in the context of the nature and size of business, to gain
continued acceptance of its products and services from the different
classes of consumers and customers.
Therefore, in common parlance, marketing is understood to mean
the sale and purchase of goods and services but it is narrow thinking
to understand it so. The term ‘marketing’ is very wide. It does not
mean only the sale and purchase of goods and services. It means
entire process of satisfying the needs of consumers! It starts with
discovery of needs and wants of the consumers, and it continues, till
these needs and wants are satisfied. To understand the meaning of
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marketing clearly; it becomes necessary that different concepts of

marketing must be understood.
Marketing as an umbrella concept, under which many sub concepts
reside. Marketing is all about servicing society and making life of
people better by providing things that they need. Most of the time
people carry a narrow and transaction based view about marketing
that is not true. Marketing is nurturing and marketer is like mother
who nurture the needs of her sibling. Like a mother understands the
requirements of her child without telling, same is expected from a
profess marketer.
Marketing is indeed as Ancient Act as it has been predicted in one
form or other since the days of Adam and Eves. Think of how
emperors marketed their military power so well that many smaller
states bowed to them without fighting and shared their state
revenue. Since then marketing has gone through a paradigm shift.
Marketing is the process of matching the resources of the business
with identified customer needs. In other words marketing is
concerned with the focusing of the organization’s resources to
ensure that the customer is satisfied at a profit to the business.
It should be observed that marketing is not exclusively applicable to
product alone. Whether you intend to market a Television Set or a
Cooking Range or offer Insurance, Banking or Health Services,
marketing is basically the same.
For the convenience, the concepts of marketing may be
divided into two parts:
(i) Old concept of marketing or product-oriented concepts, and
(ii) New concept of marketing or consumer-oriented concept.
(i) Old Concept or Product Oriented Concept of
Marketing:
Marketing is an exciting, fast-paced, and contemporary field. It
influences us daily in both our roles as provides of goods and
services and as consumers.
Different authorities as in Traditional View have defined the word
“Marketing” differently. Their marketing means to make the Goods
and find out the ultimate customers, but now, the view has been
changed from “Exchange” to satisfaction of human wants, which
means to first find what the customers want and then make the
product accordingly for satisfying their want.
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According to the classical concept of marketing, marketing is a part

of production process. This concept is based on the assumption that
the manufacturer must produce the goods and distributes them to
the consumers. He needs not to bother about the choice of the needs
of the consumers.
According to American Marketing Association, “Marketing is the
performance of business activities that direct the flow of goods and
services from the producer to consumer or user. Marketing is
organisational function and set of processes for creating,
communicating and delivering value to customers and for managing
customer relationships in ways that benefits organization and its
stakeholders.”
According to Prof. J.F. Pyle, “Marketing comprises both buying and
selling activities”. Above two definitions of marketing confines the
marketing to sale and purchase only.
According to Tousiey, Clark and Clark, “Marketing consists of those
efforts which effects transfers in the ownership of goods and
services and provide for their physical distribution”.
This definition of marketing includes the factor of physical
distribution also along with sale and purchase of goods and
commodities. Thus, this definition is wider than the earlier
definitions.
These definitions do not include any allied activity of marketing
such as, transportation, storage, financing, insurance, risk bearing,
etc.
Characteristics of Old or Product-Oriented Concept of
Marketing:
Main characteristics of this concept of marketing are as
follows:
(a) It stresses upon production.
(b) It assumes that marketing is only the physical distribution of
goods and services from producer to consumer.
(c) It assumes that marketing starts after the goods have been
produced and it ends after the goods have been sold.
(d) It does not provide for any allied activity of marketing such as,
transportation, warehousing, insurance, financing etc.
(e) According to this concept, the ultimate object of marketing is to
maximize the profits by maximizing the sales.
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(ii) New/Modern Concept or Customer Oriented Concept

of Marketing:
Modern concept of marketing is a customer-oriented concept. This
concept is based on the assumption that a business and industrial
enterprises can achieve its object of maximizing the profits only
when it considers the needs and wants of its consumers and it tries
the satisfaction of these needs and wants.
Therefore, according to this concept, marketing starts with the
discovery of needs and wants of consumers and ends with the
satisfaction of these needs and wants.
According to William J. Stanton, “Marketing is a total system of
interacting business activities designed to plan, price, promote and
distribute want-satisfying products and services to the present and
potential customers”.
According to Prof. Paul Mazur, “Marketing is the delivery of
standard of living to the society”.
According to Prof. Malcolm McNair, “Marketing is the creation and
delivery of standard of living to the society”.
According to Cundiff and Still, “Marketing is the business process
by which products are matched with tie market and through which
the transfers of ownership are affected.
Characteristics of New or Modern or Consumer-Oriented
Concept of Marketing:
Important characteristics of this concept are as follows:
(a) According to this concept consumer is the key of the market and
his needs and wants are the goals of the business activities.
(b) Marketing is the entire process of understanding and satisfying
the needs and wants of consumers.
(c) Under this concept, first of all the needs and wants of consumers
are discovered; then these needs and wants are converted into
goods and services; then demand is created for these goods and
services: these goods and services are physically distributed from
producer to consumer and after-sale-services are provided so that
the needs of consumers may be satisfied in most effective manner.
(d) This concept assumes that the object of earning the profit can be
achieved only when the needs of society are satisfied.
(e) According to this concept, Marketing is the creation and delivery
of standard of living to the society.
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Importance of Modern Concept of Marketing:

The importance of modern concept of marketing may be
described as under:
a. Helpful in Product Development:
Modern concept of marketing is very helpful in the discovery and
development of new products because this concept is based on
intensive research regarding needs, wants and behaviour of
consumers. Based on such research, the businessman always tries
for new and developed products so that he may produce and
increase the demand for his product. Thus, this concept results in
the development of products.
b. More Social Satisfaction:
Modern concept of marketing stresses upon the satisfaction of
needs and wants of consumers. It starts with the discovery of
consumer needs and every activity of a business and industrial
enterprise clusters around these needs.
Under this concept, the goods of standard quality are provided to
the consumers at reasonable prices, at the time and place most
suitable to the consumers, through channels of distribution most
convenient to the consumers and the best possible after-sale-
services are provided. Thus, this concept provides for greater social
satisfaction. In fact, it creates and delivers the standard of living to
the society.
c. Importance towards National Economy:
Modern concept of marketing is important not only from the
consumer’s and producer’s point of view but also from the point of
view of the country as a whole. This concept provides more
employment, makes maximum exploitation to the resources of the
country. Restricts the wastage to the minimum and up gears, the
industrial production. It provides more and new goods and services
to the society and increases the standard of living. Thus, this
concept of marketing is very helpful in the overall growth and
development of the country.
Marketing for those in role of goods and service providers, is related
to decisions as choosing who our customers are, what goods and
services to offer, where to sell these goods and services, agendas to
stress in marketing related communication, the prices to charge and
create and sustain demand. Marketing decisions also involve
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choosing to offer products internationally (as well as domestically)

and how to operate in an ethical and socially responsible manner.
Marketing was earlier seen as supporter of organizational strategies.
In today’s context marketing has occupied the driver role in
organizational strategy making. The job of marketing is not limited
to chosen few; rather successful organizations are marketing
organizations where ‘everybody is marketer’. Endlessly marketers
are expected to reinvent their market dynamics and find what their
customers are looking for and how they could be satisfied in better
manner than competitors.
Components of Modern Concept of Marketing:
a. Customer-Oriented:
The very first and most important base of modern concept of
marketing is that it is a customer-oriented concept of marketing.
This concept assumes that all the activities of a producer must go
around the choice or behavior of consumers. It assumes that we
should produce the quality which is liked by our consumers; we
should produce the quantity which is required by our consumers;
we should fix the price which can be afforded by our consumers; we
should distribute our products through the channels of distribution
which are most suited to our consumers; and we should provide this
all at the time and place most convenient to our consumers.
Therefore, a successful producer is one who stress upon marketing
research and as a result it makes the necessary changes in his
product.
The main components of this concept are as under:
(i) A consumer is the king of the market. A producer depends upon
his consumers and the consumers do not depend upon the
producer.
(ii) Only those goods and services can be sold in the market, which
are according to the tastes and likings of consumers.
(iii) A producer should always stress upon the production of new
and developed products so that he may attract more consumers.
b. Integrated Marketing:
The second important base of modern concept of marketing is that
marketing is an integrated system. It is not limited to physical
distribution of goods and services. Under this concept a firm has to
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satisfy the needs of its customers by establishing effective co-

ordination between various departments.
Marketing department has to co-ordinate the activities of all other
departments of the firm in a manner that all the departments may
discharge their responsibilities in the best possible manner and may
contribute to the satisfaction of consumers. All the departments of a
firm are coordinated through marketing department and the
decisions of marketing manager are considered to be the most
important. All other departments have to follow these decisions.
c. Profits through the Satisfaction of Consumers:
According to this new concept of marketing object of a firm must be
earning the maximum profits through maximum satisfaction of
consumers. This concept is based on the assumption that
satisfaction of consumer needs is itself a great success to the firm. If
the consumers of a firm feel satisfied, the demand of the products of
the firm will increase.
It will result in the increase of sales and increase of profits. Thus,
this concept emphasizes upon the maximization of profits through
satisfaction of consumers and not through maximization of sales.
d. Consumer Welfare:
New concept of marketing stresses upon consumer welfare. It starts
with the discovery of consumer needs and it ends with the
satisfaction of these needs. And the efforts are made to provide the
goods and services of best quality at most reasonable prices. Thus, it
is a social concept focusing upon consumer welfare.
Evolution of Marketing – 3 Distinct Stages
Marketing has developed in an evolutionary manner, and not in a
revolutionary manner. In other words, there is only an evolution of
marketing, and not a revolution of marketing.
Evolution of marketing means slow and gradual development of

marketing over the years.
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Various Stages of Evolution of Marketing:

Evolution of marketing is closely connected with different stages of
human civilisation or stages of economic development of man.
The evolution of marketing can be studied under three distinct

stages.
Those three stages or periods are:

1. Pre-industrial Revolution Period.
2. Period of Industrial Revolution.
3. Post-industrial Revolution Period.
Let us, now, consider the evolution of marketing in these

three periods or stages:
1. Marketing in the Pre-Industrial Revolution Period:
In the earliest stage of human civilisation or economic development,
i.e., in the hunting and fishing stage, man led a primitive life. He
lived mostly on wild fruits, roots, flesh of animals and birds and
fish. He covered his body with leaves of trees and skins of animals.
He lived in caves. His main occupation was hunting. As his main
occupation was hunting, he did not live in a fixed place.
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He moved from place to place in search of food. He lived in groups

called tribes. His wants were very few and simple. His elementary
wants of life, viz., food, clothing and shelter, were satisfied by
himself and his family. Therefore, commerce did not exist at this
stage, and consequently, marketing was not there at this stage.
In course of time, i.e., during the pastoral stage, man, instead of

killing the animals for food and clothing, domesticated them.
Animals like cattle, sheep, goats, pigs, etc. were domesticated, and
they provided him with food and clothing. Even at this stage, man
could not settle down in any particular place.
He had to move from place to place in search of grass for his

domestic animals. Though man had reached a slightly better degree
of economic development at the pastoral stage, commerce did not
exist even at this stage, as the tribes were self-sufficient. On account
of the absence of commerce, marketing did not exist even at this
stage.
A little later, i.e., during the next stage, called the agricultural stage,
man developed agriculture as his occupation. Owing to his
occupation, viz., settled agriculture, he had to live in a fixed place.
Therefore, he built houses to live in. This led to the growth of
communities or villages. Further, simple form of division of labour
was practised at this stage. According to the principle of division of
labour, different villages produced different commodities.
They produced more than their requirements. Therefore, they

exchanged their surplus products for the products of other villages.
Thus, the foundation of trade was laid at the agricultural stage, and
trade, the heart of marketing, laid the foundation of marketing at
this stage.
Agriculturalists required agricultural tools, houses, clothes, etc. In

order to meet these requirements of agriculturists, some people
engaged themselves in the making of agricultural tools, building of
houses, weaving of clothes, etc. Thus, a body of professional
craftsman and artisans, such as blacksmiths, carpenters, masons,
weavers, etc. came into existence. So, this stage was called the
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handicraft stage. The craftsmen and artisans, at the handicraft

stage, carried on production with their hands in their homes on a
small scale.
They supplied their products to the agriculturists, and in return,

obtained their requirements from the agriculturists. Thus, the
simple form of division of labour, which was already there, was
developed further. Some people specialised in agriculture, and
others specialised in various handicrafts. This division of labour
among the people contributed to the system of barter, i.e., exchange
of goods for goods. The emergence of barter system indicated the
gradual development of marketing, the foundation of which was
already laid at the agricultural stage.
No doubt, the barter system (i.e., exchange of goods for goods),

prevalent during the agricultural and handicraft stages, contributed
to the growth of trade and marketing. But certain difficulties, such
as absence of double coincidence of wants, lack of common measure
of value, difficulty of sub-division of certain commodities and the
difficulty of storing wealth, were noticed in the barter system with
the progress of human civilisation and with the increased volume of
trade.
To overcome the difficulties of the barter system, money was

introduced. With the introduction of money, goods were exchanged
for money, and money was exchanged for goods. Further, the value
of every commodity entering into trade was expressed in terms of
money. Initially, certain commodities, such as skins of animals,
shells, cattle, wheat, etc. which were commonly accepted as medium
of exchange, were used as money.
Subsequently, metals, such as iron, copper, silver, gold, etc., were

used as money. Later, these metals were converted into coins of
definite size, weight and value and the metallic coins were used as
money. Still later, paper money (i.e., currency notes) was
introduced. The use of money, viz., metallic coins and currency
notes, contributed to further development of trade and marketing.
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With the growth of population, the handicraft system could not

meet the increasing demands of the people. Therefore, the domestic
system came into existence. Under the domestic system, a number
of middlemen or merchants appeared. These merchants and
middleman supplied raw materials to craftsmen and artisans for
production. The craftsmen and artisans converted the raw materials
into finished goods in their own houses with their own labour and
tools, delivered the finished goods to the merchants and received
their charges.
The merchants, in turn, sold the finished goods to the consumers.

This contributed to further development of trade and marketing.
The appearance of middlemen or merchants in the field of trade and
marketing signified the presence of specialised persons in the field
of marketing, and these specialised persons contributed to the
development of marketing. At this stage, there also appeared the
system of offers and negotiations to determine the terms of
exchange.
Again, at this stage, the system of personal selling also came into
existence. At this stage, there was also the development of local
markets, which gradually developed into town markets. Above all,
at this stage, pricing became the chief mechanism of trade and
marketing.
2. Marketing during the Period of Industrial Revolution:

Industrial Revolution between 1730 and 1930 contributed to the
remarkable development of modern marketing. In fact, modern
marketing is regarded as the child of Industrial Revolution.
During the period of Industrial Revolution, there was increased use

of giant machines for the production of goods. Further, there was
change in the system of production. The domestic system of
production was replaced by the factory system of production under
which goods were produced in large factories. Again, there was
mass or large-scale production of standardised goods. Above all,
there was also the emergence of new forms of business
undertakings, particularly joint stock companies.
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The large-scale production, brought about by the Industrial

Revolution, necessitated large-scale distribution of goods required
for the success of large-scale production. Further, the remarkable
development in transport systems, brought about by the Industrial
Revolution, also contributed to the success of large-scale
distribution of goods. Markets for goods were expanded into
national markets and further to international or world markets.
Thanks to the above changes in production and distribution,

brought about by the Industrial Revolution, the channels of
distribution of goods became longer, and so, better methods had to
be devised to market the goods over long distances. Branding and
packaging of goods had to be introduced by every manufacturer of
goods to distinguish his goods from those of rival manufacturers
and to create and expand the markets for his goods.
Advertising was evolved as a means of stimulating sales.

Manufacturer’s agents and salesmen were added to expand the
existing markets or to find new markets. Sales promotion was
employed to stimulate immediate sales. New products were
developed and quality of products was improved to gain preferred
positions in the markets.
It may also be noted that, with automation in industries, brought

about by industrial Revolution, the hours of working in the factories
were reduced, and people had more leisure time with them. Again,
with the economic development brought about by the Industrial
Revolution, there was increase in the income of the people. These
changes led to demand for new goods and services, which in turn,
led to more marketing opportunities for the sale of new products
and services.
From a study of the above facts, it is quite clear that Industrial

Revolution had contributed immensely to the development of
modem marketing.
3. Marketing in the Post-Industrial Revolution Era:

In the Post-industrial Revolution era, there is economic revolution
(i.e., development). The economic revolution in the Post-industrial
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Revolution era has, in large part, been a marketing revolution

caused by the assumption of responsibility for creative and
aggressive marketing by businessmen. Fifty years ago, the typical
attitude of businessman towards marketing was that the sales
department would sell whatever products the factory produced. But,
today, the attitude of businessmen towards marketing is to produce
what the consumers need and desire. That means, consumer-
oriented marketing was evolved.
After the Second World War, thanks to increase in population, large

increase in the income level of the people and the demand for new
goods and services, the size and the characteristics of the markets
have changed considerably. Astounding developments have taken
place in business and marketing. There has been the introduction of
a greater variety of goods as well as services. In short, there is
further development of consumer marketing.
At the same time, marketing of products and services has become

unusually difficult because of severe competition, abundant choices
available to consumers and the awareness of the consumers about
their rights and importance in the marketing of goods. So, to
maintain and to expand their markets, businessmen are required to
ensure that their products and services are available at a place
convenient to consumers, at prices which the consumers can afford
and at a time when the consumers need.
Businessmen are also required to see that the complaints received

from consumers are attended to promptly, and there are proper
after-sales services. All these developments mean still further
development of modern marketing.
Again, due importance is given to marketing research and

information in modern or present day marketing. The importance
of advertising has increased in recent years, and advertising has
become scientific. The importance of personal selling has also
increased. There is also aggressive selling, and the importance of
sales promotion has increased considerably.
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Of late, there is even price war between businessmen so as to

increase their market segments and market shares.
Pre-industrial society refers to social attributes and forms of political and cultural

organization that were prevalent before the advent of the Industrial Revolution, which
occurred from 1750 to 1850. Pre-industrial refers to a time before there were machines
and tools to help perform tasks en masse.
The Industrial Revolution was the transition to new manufacturing processes in Europe and the
United States, in the period from between 1760 to 1820 and 1840.
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Marketing Environment
“Marketing Environment can be defined as various internal (Micro) and external (Macro)

factors under which marketing functions take place.” Impact of Liberalization, Privatization
and Globalization on Indian Marketing Environment: Indian economy had experienced
major policy changes in early 1990s.
The Marketing Environment includes the internal factors (employees, customers,

shareholders, retailers & distributors, etc.) and the External factors (political, legal, social,
technological, economic) that surround the business and influence its marketing operations.
Definition:
“Marketing Environment can be defined as various internal (Micro)

and external (Macro) factors under which marketing functions take
place.”
“A company’s marketing environment consists of the internal
factors and forces, which affect the company’s ability to develop and
maintain successful transactions and relationships with the
company’s target customers”. – ‘Philip Kotler’
Definition of Marketing Environment:

According to Philip Kotler,
“A company’s marketing environment consists of the internal
factors & forces, which affect the company’s ability to develop &
maintain successful transactions & relationships with the
company’s target customers.”
Some of these factors are controllable while some are uncontrollable and require business
operations to change accordingly. Firms must be well aware of its marketing environment in
which it is operating to overcome the negative impact the environment factors are imposing
on firm’s marketing activities.
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The marketing environment can be broadly classified into three parts:
1. Internal Environment – The Internal Marketing Environment includes all the factors
that are within the organization and affects the overall business operations. These factors
include labour, inventory, company policy, logistics, budget, capital assets, etc. which are
a part of the organization and affects the marketing decision and its relationship with the
customers. These factors can be controlled by the firm.
2. Microenvironment- the Micro Marketing Environment includes all those factors that
are closely associated with the operations of the business and influences its functioning. The
microenvironment factors include customers, employees, suppliers, retailers & distributors,
shareholders, Competitors, Government and General Public. These factors are controllable to
some extent.
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These factors are further elaborated:
 Customers – Every business revolves around fulfilling the customer’s needs and

wants. Thus, each marketing strategy is customer oriented that focuses on understanding
the need of the customers and offering the best product that fulfils their needs.
 Employees– Employees are the main component of a business who contributes

significantly to its success. The quality of employees depends on the training and
motivation sessions given to them. Thus, Training & Development is crucial to impart
marketing skills in an individual.
 Suppliers– Suppliers are the persons from whom the material is purchased to make a
finished good and hence are very important for the organization. It is crucial to identify
the suppliers existing in the market and choose the best that fulfils the firm’s requirement.
 Retailers & Distributors– The channel partners play an imperative role in

determining the success of marketing operations. Being in direct touch with customers
they can give suggestions about customer’s desires regarding a product and its services.
 Competitors– Keeping a close watch on competitors enables a company to design its

marketing strategy according to the trend prevailing in the market.
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 https://www.youtube.com/watch?v=axhjLLi0wLg
 Shareholders– Shareholders are the owners of the company, and every firm has an
objective of maximizing its shareholder’s wealth. Thus, marketing activities should be
undertaken keeping in mind the returns to shareholders.
 Government– The Government departments make several policies viz. Pricing

policy, credit policy, education policy, housing policy, etc. that do have an influence on
39
the marketing strategies. A company has to keep track on these policies and make the
marketing programs accordingly.
 General public– The business has some social responsibility towards the society in
which it is operating. Thus, all the marketing activities should be designed that result in
increased welfare of the society as a whole.
3. Macro Environment-The Macro Marketing Environment includes all those factors that
exist outside the organization and cannot be controlled. It constitutes the external factors and
forces which affect the industry as a whole but don’t have a direct effect on the business.
These are also called as PESTLE framework
The detailed description of Macro factors is given below:
 Demographic / Economic Factors --The demographic environment is made up of

the people who constitute the market. It is characterised as the factual investigation
and segregation of the population according to their size, density, location, age,
gender, race, and occupation.
 Political & Legal Factors – With the change in political parties, several changes are
seen in the market in terms of trade, taxes, and duties, codes and practices, market
regulations, etc. So the firm has to comply with all these changes and the violation of
which could penalize its business operations.
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Every business operates in the economy and is affected by the different phases it is
undergoing. In the case of recession, the marketing practices should be different as what
are followed during the inflation period.
 Social cultural Factors– The social-cultural aspect of the macro environment is

made up of the lifestyle, values, culture, prejudice and beliefs of the people. This differs in
different regions.
Since business operates in a society and has some responsibility towards it must follow the
marketing practices that do not harm the sentiments of people. Also, the companies are
required to invest in the welfare of general people by constructing public conveniences,
parks, sponsoring education, etc.
 Technological and Physical Factors– As technology is advancing day by day, the

firms have to keep themselves updated so that customers needs can be met with more
precision.
The physical environment includes the natural environment in which the business operates.
This includes the climatic conditions, environmental change, accessibility to water and raw
materials, natural disasters, pollution etc.
Conclusion:
Therefore, marketing environment plays a crucial role in the operations of a business and
must be reviewed on a regular basis to avoid any difficulty.
THE MARKETING PROCESS
The marketing process consists of the following activities:
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1. Analysing market opportunities

2. Selecting target markets
3. Developing the marketing mix
4. Managing the marketing effort
A summary of the entire marketing process is shown in figure
Demographic or Economic Technological and Physical

Environment Environment
At the centre of the process stand the consumers. The objective is to build a
strong and profitable customer relationship. The first step is market
segmentation, targeting and positioning, to decide which customers the
company should serve and how. This process identifies the total market, then
divides it into smaller segments, se Introduction to Marketing 35 control like
product, price, place and promotion. For identifying the best marketing mix
combination and to put it into action, the company engages in marketing
Political and Legal Social cultural Environment
Environment analysis, planning, implementation, and control activities. With the help of
these, the company watches and adapts to the actors and Marketing Process
Customer Relationships - In order to succeed in today’s highly competitive
market, companies must be customer-centred, winning customers from
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competitors, then keeping and growing them by delivering greater value. To

be able to satisfy the customers, a company must first analyse the consumers
and understand their needs and wants. Companies know very well that they
cannot profitably serve all customers in the same way. Most companies are in
a position to serve some segments better than others. Each company must
divide the total market, choose the best segments, and design strategies for
profitably serving chosen market segments.
This calls for a three-step process:
market segmentation,
target marketing and
Market positioning.
Market Segmentation Any market will consist of various types of customers,
products and needs. The marketer has to determine which market segments
offer the best opportunity for achieving company objectives. Consumers can
be grouped and served in various ways based on geographic, demographic,
psychographic and behavioural factors.
The process of dividing a heterogeneous market into distinct groups of buyers
who have different needs, characteristics or behaviour, and who might require
separate products or marketing programmes, is called market segmentation.
A market segment will consist of homogeneous consumers who might respond
in a similar manner to a given set of marketing efforts.
Marketing companies always focus their marketing efforts on meeting the
distinct needs and wants of individual market segments.
Target Marketing After defining the market segments, a company decides to
enter one or many segments in a given market.
Target marketing is the process of evaluating each market segment’s
attractiveness and selecting one or more segments to enter. A company should
target segments in which it can generate the greatest customer value profitably
and sustain it over time. A company with limited resources might decide to
serve only one or a few special segments or ‘market niches’. On the other
hand, a big company may decide to offer a complete range of products to
serve all market segments. As a normal practice, many companies strategically
enter a new market by serving a single segment, and if they succeed, spread
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the marketing activity to other segments.
Product stands for the goods and services offered by a company to the target market, to
satisfy needs and wants.
Price refers to the money value that the consumers have to pay to buy the product or service.
Promotion refers to activities of personal selling, advertising, and communicating product
benefits and attributes to target consumers to persuade them to purchase.
Place stands for physical distribution activities through which the product moves from the
factory to the customer. Channels of distribution, logistics, warehousing, transport, etc. come
under the place variable.
To be successful, the marketing programmes have to blend the four variables into an ideal
integrated action plan aimed at achieving the corporate objectives. While the four Ps concept
relates to the seller’s perspective of the market, there are four Cs in the consumer’s view.
They are: Four Ps Four Cs
Product Customer solution
Price Customer cost
Place Convenience
Promotion Communication
Role and Functions Marketing Department
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Marketing is related to the exchange of goods and services. Through its medium the goods
and services are brought to the place of consumption. This satisfies the needs of the
customers. The following activities are undertaken in respect of the exchange of goods and
services:
1. Gathering and Analyzing Market Information:

Gathering and analyzing market information is an important function of marketing. Under it,
an effort is made to understand the consumer thoroughly in the following ways:
(a) What do the consumers want?
(b) In what quantity?
(c) At what price?
(d) When do they want (it)?
(e) What kind of advertisement do they like?
(f) Where do they want (it)?
What kind of distribution system do they like? All the relevant information about the
consumer is collected and analyzed. On the basis of this analysis an effort is made to find out
as to which product has the best opportunities in the market.
2. Marketing Planning:
In order to achieve the objectives of an organisation with regard to its marketing, the
marketer chalks out his marketing plan. For example, a company has a 25% market share of a
particular product.
The company wants to raise it to 40%. In order to achieve this objective the marketer has to
prepare a plan in respect of the level of production and promotion efforts. It will also be
decided as to who will do what, when and how. To do this is known as marketing planning.
3. Product Designing and Development:
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Product designing plays an important role in product selling. The company whose product is
better and attractively designed sells more than the product of a company whose design
happens to be weak and unattractive.
In this way, it can be said that the possession of a special design affords a company to a
competitive advantage. It is important to remember that it is not sufficient to prepare a design
in respect of a product, but it is more important to develop it continuously.
4. Standardization and Grading:

Standardization refers to determining of standard regarding size, quality, design, weight,
colour, raw material to be used, etc., in respect of a particular product. By doing so, it is
ascertained that the given product will have some peculiarities.
This way, sale is made possible on the basis of samples. Mostly, it is the practice that the
traders look at the samples and place purchase order for a large quantity of the product
concerned. The basis of it is that goods supplied conform to the same standard as shown in
the sample.
Products having the same characteristics (or standard) are placed in a given category or
grade. This placing is called grading.
For example, a company produces commodity – X, having three grades, namely A’. ‘B’ and
‘C’, representing three levels of quality; best, medium and ordinary respectively.
Customers who want best quality will be shown ‘A’ grade product. This way, the customer
will have no doubt in his mind that a low grade product has been palmed off to him. Grading,
therefore, makes sale-purchase easy. Grading process is mostly used in case of agricultural
products like food grains, cotton, tobacco, apples, mangoes, etc.
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5. Packaging and Labelling:

Packaging aims at avoiding breakage, damage, destruction, etc., of the goods during transit
and storage. Packaging facilitates handling, lifting, conveying of the goods. Many a time,
customers demand goods in different quantities. It necessitates special packaging. Packing
material includes bottles, canister, plastic bags, tin or wooden boxes, jute bags etc.
Label is a slip which is found on the product itself or on the package providing all the
information regarding the product and its producer. This can either be in the form of a cover
or a seal.
For example, the name of the medicine on its bottle along with the manufacturer’s name, the
formula used for making the medicine, date of manufacturing, expiry date, batch no., price
etc., are printed on the slip thereby giving all the information regarding the medicine to the
consumer. The slip carrying all these is details called Label and the process of preparing it as
Labelling.
6. Branding:
Every producer/seller wants that his product should have special identity in the market. In
order to realize his wish he has to give a name to his product which has to be distinct from
other competitors.
48
Giving of distinct name to one’s product is called branding. Thus, the objective of branding is
to show that the products of a given company are different from that of the competitors, so
that it has its own identity.
For instance, if a company wants to popularize its commodity – X under the name of “777”
(triple seven) then its brand will be called “777”. It is possible that another company is selling
a similar commodity under AAA (Triple ‘A’) brand name.
Under these circumstances, both the companies will succeed in establishing a distinct identity
of their products in the market. When a brand is not registered under the trade Mark Act,
1999, it becomes a Trade Mark.
7. Customer Support Service:

Customer is the king of market. Therefore, it is one of the chief functions of marketer to offer
every possible help to the customers. A marketer offers primarily the following services to
the customers:
(I) After-sales-services
(ii) Handling customers’ complaints
(iii) Technical services
(iv) Credit facilities
(v) Maintenance services
Helping the customer in this way offers him satisfaction and in today’s competitive age
customer’s satisfaction happens to be the top-most priority. This encourages a customer’s
attachment to a particular product and he starts buying that product time and again.
8. Pricing of Products:
It is the most important function of a marketing manager to fix price of a product. The price
of a product is affected by its cost, rate of profit, price of competing product, policy of the
government, etc. The price of a product should be fixed in a manner that it should not appear
to be too high and at the same time it should earn enough profit for the organisation.
49
9. Promotion:
Promotion means informing the consumers about the products of the company and
encouraging them to buy these products. There are four methods of promotion: (i)
Advertising, (ii) Personal selling, (iii) Sales promotion and (iv) Publicity. Every decision
taken by the marketer in this respect affects the sales. These decisions are taken keeping in
view the budget of the company.
10. Physical Distribution:
Under this function of marketing the decision about carrying things from the place of
production to the place of consumption is taken into account. To accomplish this task,
decision about four factors are taken. They are: (i) Transportation, (ii) Inventory, (iii)
Warehousing and (iv) Order Processing. Physical distribution, by taking things, at the right
place and at the right time creates time and place utility.
11. Transportation:
Production, sale and consumption-all the three activities need not be at one place. Had it been
so, transportation of goods for physical distribution would have become irrelevant. But
generally it is not possible. Production is carried out at one place, sale at another place and
consumption at yet another place.
Transport facility is needed for the produced goods to reach the hands of consumers. So the
enterprise must have an easy access to means of transportation.
Mostly we see on the road side’s private vehicles belonging to Pepsi, Coca Cola, LML,
Britannia, etc. These private carriers are the living examples of transportation function of
marketing. Place utility is thus created by transportation activity.
12. Storage or Warehousing:
There is a time-lag between the purchase or production of goods and their sale. It is very
essential to store the goods at a safe place during this time-interval. Godowns are used for
this purpose. Keeping of goods in godowns till the same are sold is called storage.
For the marketing manager storage is an important function. Any negligence on his part may
damage the entire stock. Time utility is thus created by storage activity.
50
Market research
Concepts in demand
Market research
Market research
Introduction
Market research is the process of assessing the viability of a new good or service through
research conducted directly with the consumer. This practice allows a company to discover
the target market and record opinions and other input from consumers regarding interest in
the product. Market research may be conducted by the company itself or by a third-party
company that specializes in the market research field. It can be done through surveys, product
testing and focus groups. Test subjects are usually compensated with product samples and/or
paid a small stipend for their time.
Marketing Research
The process of gathering, analyzing and interpreting information about a market, about a
product or service to be offered for sale in that market, and about the past, present and
potential customers for the product or service; research into the characteristics, spending
habits, location and needs of your business's target market, the industry as a whole, and the
particular competitors you face
1. According to American Marketing Association (AMA), MR is "The systematic

gathering, recording, and analysing of data about problems relating to the marketing of
goods and services."
51
2.
3. According to Philip Kotler “ Marketing research is the systematic design, collection,

analysis and reporting of data relevant to a specific marketing situation facing an
organization”
he American Marketing Association defines “Marketing Research” as “the systematic and
objective identification, collection, analysis and dissemination of information for the purpose of
improving decision making related to the identification and solution of problems and
opportunities in marketing.”
52
Market research is defined as the process of evaluating the feasibility

of a new product or service, through research conducted directly with
potential consumers. This method allows organizations or
businesses to discover their target market, collect and document
opinions and make informed decisions.
My View of Market Research vs Marketing Research
53
Market Research
If we want to get technical, market research refers to research that pertains to,

well, markets. This is where you will dig into things like market trends (political, economic,
social, technology, etc.), market players (e.g. direct and indirect competition), target market
attributes, customer wants and needs, etc. I personally view market research to be a broader
phrase than marketing research.
Marketing Research
Marketing research, on the other hand, involves research related to marketing. I like to
think of the marketing mix (product, promotion, place, price) and consider the types of
research that relate to one of the four P’s. Examples include advertisement testing, product
concept testing (e.g. usability testings), pricing research, channel research, etc.
Overlap
You’ll notice that I mentioned many of the same items in each definition. Things like
pricing, product attribute research, and competitive research are both related to the general
market and the overall marketing effort.
Which Terms is More Widely Used?

All of this market research vs. marketing research talk has me wondering which term is more
widely used. Let’s do some crude secondary research on the topic right now and figure that out.
At the time of this posting, there are about 5x as many search results for the exact term “market
research” (57.6m) vs. “marketing research” (10.2m). That tells me market research is more
commonly used and probably carries a broader definition.
54
Three key objectives of market research

A market research project may usually have 3 different types of objectives.
1. Administrative: Help a company or business development, through

proper planning, organization, and both human and material resources
control, and thus satisfy all specific needs within the market, at the right
time.
2. Social: Satisfy customer’s specific needs through a required product
or service. The product or service should comply with the requirements
and preferences of a customer when it’s consumed.
3. Economical: Determine the economical degree of success or failure
a company can have while being new to the market, or otherwise
introducing new products or services, and thus providing certainty to all
actions to be implemented.
Why is market research important?

Conducting research is one of the best ways of achieving customer
satisfaction, reducing customer churn and elevating business. Here are the
reasons why market research is important and should be considered in any
business:
 Valuable information: It provides information and opportunities

about the value of existing and new products, thus, helping businesses
plan and strategize accordingly.
 Customer-centric: It helps to determine what the customers need
and want. Marketing is customer-centric and understanding the
customers and their needs will help businesses design products or
services that best suit them.
 Forecasts: By understanding the needs of customers, businesses
can also forecast their production and sales. Market research also helps
in determining optimum inventory stock.
 Competitive advantage: To stay ahead of competitors market
research is a vital tool to carry out comparative studies. Businesses can
devise business strategies that can help them stay ahead of their
competitors.
55
Scope of Marketing Research

Marketing Research is a well-planned, systematic process which implies that it needs
planning at all the stages. It uses scientific method. It is an objective process as it attempts to
provide accurate authentic information.
56
Marketing Research plays a very significant role in identifying the needs of customers and
meeting them in best possible way for consumer satisfaction.. The main task of Marketing
Research is systematic gathering and analysis of information.
It comprises of research relating to consumers, products, sales, distribution, advertising,

pricing and sales forecasting.
Before, it is essential to clarify the relationship and difference between Marketing Research
and Marketing Information System (MIS). Whatever information are generated by Marketing
Research from internal sources, external sources, marketing intelligence agencies-consist the
part of MIS.
PLANNING IMPLIMENTATION Evaluation
MIS is a set of formalized procedures for generating, analyzing, storing and distributing
information to marketing decision makers on an ongoing basis.
1. While Marketing Research is done with a specific purpose in mind with information
being generated when it is conducted, MIS information is generated continuously.
2. MIS is continuous entity while Marketing Research is a ad-hoc system.
3. While in Marketing Research information is for specific purpose, so it is not rigid; in
MIS information is more rigid and structured.
Marketing Research is essential for strategic market planning and decision making. It helps a
firm in identifying what are the market opportunities and constraints, in developing and
implementing market strategies, and in evaluating the effectiveness of marketing plans.
Marketing Research is a growing and widely used business activity as the sellers need to
know more about their final consumers but are generally widely separated from those
consumers. Marketing Research is a necessary link between marketing decision makers and
the markets in which they operate.
Marketing Research includes various important principles for generating information which
is useful to managers. These principles relate to the timeliness and importance of data, the
57
significance of defining objectives cautiously and clearly, and the need to avoid conducting
research to support decisions already made.
In order to take decisions any marketer would constantly monitor such information and
obtain a continuous feedback of the trends in the market. As such, marketing research is an
effective tool for measuring the consumers’ aspirations, trade channel behaviour, competitive
actions etc.
It provides a linkage between the corporate environment and the marketing organization.
Marketing research, thus, may be viewed as an important tool used as an aid for tackling
problems in marketing.
Marketing Research Process
Some of the major steps involved in marketing research process are as follows:
1. Identification and Defining the Problem
2. Statement of Research Objectives
3. Planning the Research Design or Designing the Research Study
4. Planning the Sample
5. Data Collection
6. Data Processing and Analysis
7. Formulating Conclusion, Preparing and Presenting the Report.
Marketing research exercise may take many forms but systematic enquiry is a feature
common to all such forms. Being a systematic enquiry, it requires a careful planning of the
orderly investigation process.
58
Though it is not necessary that all research processes would invariably follow a given
sequence, yet marketing research often follows a generalised pattern which can be broken
down and studied as sequential stages.
The various stages or steps in the marketing research process are discussed below:
1. Identification and Defining the Problem:
The market research process begins with the identification “of a problem faced by the
company. The clear-cut statement of problem may not be possible at the very outset of
research process because often only the symptoms of the problems are apparent at that stage.
Then, after some explanatory research, clear definition of the problem is of crucial
importance in marketing research because such research is a costly process involving time,
energy and money.
Clear definition of the problem helps the researcher in all subsequent research efforts
including setting of proper research objectives, the determination of the techniques to be
used, and the extent of information to be collected.
It may be noted that the methods of explanatory research popularly in use are—survey of
secondary data, experience survey, or pilot studies, i.e., studies of a small initial sample. All
this is also known as ‘preliminary investigation’.
2. Statement of Research Objectives:

After identifying and defining the problem with or without explanatory research, the
researcher must take a formal statement of research objectives. Such objectives may be stated
in qualitative or quantitative terms and expressed as research questions, statement or
hypothesis. For example, the research objective, “To find out the extent to which sales
promotion schemes affected the sales volume” is a research objective expressed as a
statement.
On the other hand, a hypothesis is a statement that can be refuted or supported by empirical
finding. The same research objective could be stated as, “To test the proposition that sales are
positively affected by the sales promotion schemes undertaken this winter.”
59
Example of another hypothesis may be: “The new packaging pattern has resulted in increase
in sales and profits.” Once the objectives or the hypotheses are developed, the researcher is
ready to choose the research design.
3. Planning the Research Design or Designing the Research Study:

After defining the research problem and deciding the objectives, the research design must be
developed. A research design is a master plan specifying the procedure for collecting and
analysing the needed information. It represents a framework for the research plan of action.
The objectives of the study are included in the research design to ensure that data collected
are relevant to the objectives. At this stage, the researcher should also determine the type of
sources of information needed, the data collection method (e.g., survey or interview), the
sampling, methodology, and the timing and possible costs of research.
4. Planning the Sample:

Sampling involves procedures that use a small number of items or parts of the ‘population’
(total items) to make conclusion regarding the ‘population’. Important questions in this
regard are— who is to be sampled as a rightly representative lot? Which is the target
‘population’? What should be the sample size—how large or how small? How to select the
various units to make up the sample?
5. Data Collection:
The collection of data relates to the gathering of facts to be used in solving the problem.
Hence, methods of market research are essentially methods of data collection. Data can be
secondary, i.e., collected from concerned reports, magazines and other periodicals, especially
written articles, government publications, company publications, books, etc.
Data can be primary, i.e., collected from the original base through empirical research by
means of various tools.
There can be broadly two types of sources

(i) Internal sources—existing within the firm itself, such as accounting data, salesmen’s
reports, etc.
(ii) External sources—outside the firm.
60
6. Data Processing and Analysis:

Once data have been collected, these have to be converted into a format that will suggest
answers to the initially identified and defined problem. Data processing begins with the
editing of data and its coding. Editing involves inspecting the data-collection forms for
omission, legibility, and consistency in classification. Before tabulation, responses need to be
classified into meaningful categories.
The rules for categorizing, recording and transferring the data to ‘data storage media’ are
called codes. This coding process facilitates the manual or computer tabulation. If computer
analysis is being used, the data can be key punched and verified.
Analysis of data represents the application of logic to the understanding of data collected
about the subject. In its simplest form analysis may involve determination of consistent
patterns and summarising of appropriate details.
The appropriate analytical techniques chosen would depend upon informational requirements
of the problem, characteristics of the research designs and the nature of the data gathered.
The statistical analysis may range from simple immediate analysis to very complex
multivariate analysis.
7. Formulating Conclusion, Preparing and Presenting the Report:

The final stage in the marketing research process is that of interpreting the information and
drawing conclusion for use in managerial decision. The research report should clearly and
effectively communicate the research findings and need not include complicated statement
about the technical aspect of the study and research methods.
Often the management is not interested in details of research design and statistical analysis,
but instead, in the concrete findings of the research. If need be, the researcher may bring out
his appropriate recommendations or suggestions in the matter. Researchers must make the
presentation technically accurate, understandable and useful.
Meaning of Demand Forecasting:

Accurate demand forecasting is essential for a firm to enable it to produce the required
quantities at the right time and arrange well in advance for the various factors of production
e.g., raw materials, equipment, machine accessories etc. Forecasting helps a firm to access
61
the probable demand for its products and plan its production accordingly. Forecasting is an
important aid in effective and efficient planning.
It reduces the uncertainty and making the organization more confident of coping with the
external environment. The increasing availability of economic data, the continuous
improvement of technique and the expanded computational ability provided by the computer
made it possible for firms to forecast their demand/sales with considerable accuracy.
Accurate demand forecasting is essential for a firm to enable it to produce the required
quantities at the right time and arrange well in advance for the various factors of production.
According to Henry Fayol, “the act of forecasting is of great benefit to all who take part
in the process and is the best means of ensuring adaptability to changing circumstances.
The collaboration of all concerned lead to a unified front, an understanding of the
reasons for decisions and a broadened outlook”.
Importance of Demand Forecasting:

The importance of demand/sales forecasting can be understood by the following lines:
1. Helpful in deciding the number of salesmen required to achieve the sales objective.
2. Determination of sales territories.
3. To determine how much production capacity to be built up.
4. Determining the pricing strategy.
5. Helpful in deciding the channels of distribution and physical distribution decision.
6. To decide to enter a new market or not.
7. To prepare standard against which to measure performance.
8. To assess the effect of a proposed marketing programme.
9. To decide the promotional mix.
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10. Helpful in the product mix decisions relating to width and length of product line.
Demand Forecasting Methods
1. Qualitative Techniques
2. Quantitative Techniques
Qualitative Methods
The qualitative (or judgmental) approach can be useful in formulating short-term forecasts
and can also supplement the projections based on the use of any of the quantitative methods.
Four of the better-known qualitative forecasting methods are executive opinions, the Delphi
method, sales-force polling, and consumer surveys:
1. Executive Opinions
The subjective views of executives or experts from sales, production, finance, purchasing,
and administration are averaged to generate a forecast about future sales. Usually this method
is used in conjunction with some quantitative method, such as trend extrapolation. The
management team modifies the resulting forecast, based on their expectations.
 The advantage of this approach: The forecasting is done quickly and easily, without
need of elaborate statistics. Also, the jury of executive opinions may be the only
means of forecasting feasible in the absence of adequate data.
 The disadvantage: This, however, is that of group-think. This is a set of problems
inherent to those who meet as a group. Foremost among these are high cohesiveness,
strong leadership, and insulation of the group. With high cohesiveness, the group
becomes increasingly conforming through group pressure that helps stifle dissension
and critical thought. Strong leadership fosters group pressure for unanimous opinion.
Insulation of the group tends to separate the group from outside opinions, if given.
2. Delphi Method
This is a group technique in which a panel of experts is questioned individually about their
perceptions of future events. The experts do not meet as a group, in order to reduce the
possibility that consensus is reached because of dominant personality factors. Instead, the
63
forecasts and accompanying arguments are summarized by an outside party and returned to
the experts along with further questions. This continues until a consensus is reached.
 Advantages: This type of method is useful and quite effective for long-range
forecasting. The technique is done by questionnaire format and eliminates the
disadvantages of group think. There is no committee or debate. The experts are not
influenced by peer pressure to forecast a certain way, as the answer is not intended to
be reached by consensus or unanimity.
 Disadvantages: Low reliability is cited as the main disadvantage of the Delphi
method, as well as lack of consensus from the returns.
3. Sales Force Polling

Some companies use as a forecast source salespeople who have continual contacts with
customers. They believe that the salespeople who are closest to the ultimate customers may
have significant insights regarding the state of the future market. Forecasts based on sales
force polling may be averaged to develop a future forecast. Or they may be used to modify
other quantitative and/or qualitative forecasts that have been generated internally in the
company.
The advantages of this forecast are:

 It is simple to use and understand.
 It uses the specialized knowledge of those closest to the action.
 It can place responsibility for attaining the forecast in the hands of those who most
affect the actual results.
 The information can be broken down easily by territory, product, customer, or
salesperson.
The disadvantages include: salespeople’s being overly optimistic or pessimistic regarding
their predictions and inaccuracies due to broader economic events that are largely beyond
their control.
4. Consumer Surveys
Some companies conduct their own market surveys regarding specific consumer purchases.
Surveys may consist of telephone contacts, personal interviews, or questionnaires as a means
64
of obtaining data. Extensive statistical analysis usually is applied to survey results in order to
test hypotheses regarding consumer behaviour.
Quantitative Techniques
Statistical Method
The statistical method is one of the important methods of demand forecasting. Statistical
methods are scientific, reliable and free from biases. The major statistical methods used for
demand forecasting are:
a. Trend Projection Method: This method is useful where the organization has

sufficient amount of accumulated past data of the sales. This date is arranged
chronologically to obtain a time series. Thus, the time series depicts the past trend and on
the basis of it, the future market trend can be predicted. It is assumed that the past trend
will continue in future. Thus, on the basis of the predicted future trend, the demand for a
product or service is forecasted.
b. Regression Analysis: This method establishes a relationship between the dependent

variable and the independent variables. In our case, the quantity demanded is the
dependent variable and income, the price of goods, price of related goods, the price of
substitute goods, etc. are independent variables. The regression equation is derived
assuming the relationship to be linear. Regression Equation: Y = a + bX. Where Y is the
forecasted demand for a product or service.
65

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Marketing Management Dr.Lt.

to acquire, keep, and grow customers.

Market and Marketing

 According to the products being sold. Example: cotton market, iron market, share

 Based on geographical locations, like a local market or international market

 The quantity of goods transacted between parties like a wholesale market or a retail

Coca cola https://www.youtube.com/watch?v=LmWJCpwkcHk&t=40s

Coca Cola https://www.youtube.com/watch?v=5b18LXBpVDo

 Marketing is meeting the needs and wants of a consumer.

 Marketing is helping people buy your product or service.

Note that the definitions make several points:

 A main objective of marketing is to create customer value.

Important Features of Marketing

goods/services, which can be money or something else. It must be an exchange

Although; In some scenario ; the production concept is still a useful philosophy.

The product thought holds that the customers can favor product that supply the foremost in

For example; Suppose a company makes the most effective quality magnetic disk. however you

one more example-why nokia products failed?

now we understand this concept with examples-Every saw an ad online or on TV commercial

4.Marketing Concept-Here we understand this concept , marketing management takes a

now we are going to understand this concept with examples-

5.Societal Marketing-It can be defined as the Societal Marketing Concept puts

Evolution of Marketing Concept

A correct understanding of marketing concept is fundamental to the study of modern

A ‘concept’ is a philosophy, an attitude, a course of thinking, an idea or a notion relating to

Following is the brief explanation of each philosophy and corresponding period:

1. Production Orientation Philosophy:

The assumptions of this concept are:

(i) Anything that can be produced can be sold,

(iii) A firm should produce only certain basic products.

This concept can be illustrated as under:

2. Sales Orientation Philosophy

The assumptions of this philosophy are:

(i) Producing the best possible product.

(ii) Finding the buyer for the product,

It can be illustrated as under:

3. Customer Orientation Philosophy:

The assumptions are:

It can be illustrated as under:

This means a radical change in the philosophy.

It meant two basic changes namely:

(i) Move from production to market-orientation,

4. Social Orientation Philosophy

The assumptions of social-orientation philosophy are:

(iii) The firm should discharge its social responsibilities,

This concept can be illustrated as under:

However, during the 1930s changes in social and economic

The fact that marketing is virtually everywhere in today’s free-

(2) The Sales Era:

Pillsbury’s marketing orientation grew during the 1950s, a decade in

enhanced products. During the 1950s, Pillsbury expanded its

Evolution of Marketing – Evolution Process Charted

industrial revolution to produce goods on a mass scale in

marketing clearly; it becomes necessary that different concepts of

According to the classical concept of marketing, marketing is a part

(ii) New/Modern Concept or Customer Oriented Concept

Importance of Modern Concept of Marketing:

choosing to offer products internationally (as well as domestically)