Class 1

Marketing for the 21st Century

 About me!
• Sridhar Samu
• Retired from Great Lakes June 2022
– BSC (Engg) REC (now NIT) Kozhikode
– PGDBM – XLRI Jamshedpur
– PHD – Indiana University
• 16 years (study + work) in US and Canada
• 9 years at ISB
• Research interests – information processing, branding, social marketing
• Prefer not to work on weekends!
• Pet dog – Candy
• E-mail is the best way to contact me
 Class Rules
• Come to class on time! If late, just come in and
take a seat!
• Come fully prepared
• No cheating or plagiarizing
• Mobiles on silent or switched off
• No laptops unless specified
• Discussions
– Speak to the point
– Allow others to speak, and maybe even disagree with you
 Let me first listen to you

• What thoughts come to mind when you think of Marketing?

 Course Overview
• Review of Intro to Marketing – STP and other areas
• Marketing strategy and plan
• Global markets
• Social marketing, including CSR
• 4 P’s
 The 10 Deadly Marketing Sins
• Not sufficiently market focused and customer driven
• Not understand its target customers
• Need to define and monitor competition
• Not managing relationships with stakeholders
• Not good at finding new opportunities
• Marketing planning process is deficient
• Product and service policies not tight enough
• Brand building and communication skills are weak
• Not organized for effective and efficient marketing
• Not using technology well
 Assignment 1
• Pick any two of the marketing sins (your choice)
• One para on your understanding of that idea
• One para on a good example based on current
developments in the market
• Individual or group assignment?
• Let me make it individual to know everyone
 Changes in Shopping Behavior
• Manufacturer brands under intense pressure
– Corona virus
– Commoditized category/mega brands
– Developing versus developed countries
– Price versus convenience
– Classic model of retail brands/promotion strategies
– Tech and digitization – impact
– Tech giants, aggregators, Apps, influencers, etc., etc.
– Role of retailer brands – new trends
– Multiple sources of information for consumers
– Prescription based approach
 What Is 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
– Who (set of institutions) does and what (activity/process) is done?
– Purpose of activity - creating, communicating, delivering, and exchanging
offerings
– Expectation – value for customers and society
• Marketing is a total system of activities
– designed to plan, price, promote, and distribute
– need-satisfying products, services, and ideas
– to target markets
– in order to achieve the objectives of both the customer and the organization.
 Marketing Overview
• Exchange process
• What actions enable exchange
– Deciding on the mix
• Selection of market
• Segmenting the market
• Differentiating the product
• Marketing process
– Situation and environmental analysis
– Strategy formulation
– Strategy execution and assessing performance
 Marketing as Exchange
• What do we mean by exchange?
– Giving and receiving
– Trade, swap, switch, barter, etc., etc.
• Three characteristics of exchange
– Utilitarian exchange
– Symbolic exchange
– Mixed exchange
 Marketing Exchange
• Utilitarian exchange
– Barter or exchanging for money
– From economics, the rational (wo)man
• Rational behaviour
• Utility (or satisfaction) maximization
• Consumers act with perfect and complete information
• Symbolic exchanges
– Psychological or social or intangible items are transferred
– Important from a functional point, but sometimes what they mean
is also important
 Marketing Exchange
• Mixed exchange
– Marketing involves both utilitarian and symbolic
– Hence mixed exchanges
– Very inter related and difficult to find out what is involved
• Assumptions about consumers
– Mostly rational, sometimes irrational
– Rewards are important – small, large, medium….
– Mixed exchanges dominate
– Operates with incomplete information – and that too, extremely well
– Good at operating under multiple constraints – legal, social, ethical, etc.
 For exchange to occur….

• There are at least two parties.

• Each party has something that might be of value to the
other party.
• Each party is capable of communication and delivery.
• Each party is free to reject the exchange offer.
• Each party believes it is appropriate or desirable to
deal with the other party.
 What makes Exchange Easier?
• Marketing Mix
– Right customers
– Right products
– Right price
– Right place
– Right information
 Setting the Mix
• Selection of market – how and why to choose one
market over multiple others
• Market segmentation – within this overall market,
should we sell to all or to select few
– Mass market, Market segment, Market niche, individuals
– Demographic, geographic, lifestyle
– Use status, usage rate, benefits sought, loyalty status, attitude
towards product
• Positioning statement
 Setting the mix
• Positioning statement
• Gold Drop (our brand) makes food tastier (claim)
among all Sunflower oil brands (competitive
frame) because it is pure (single most important
support)
• What to offer – same as everyone or different.
When should it be the same and when should it be
different?
 Implementing the Mix
• Product
– Line breadth, length, depth – managing addition and deletions
– Design, positioning, name and branding, packaging, level of customer
service, warranty
• Place
– Channel design and management, direct and indirect channels, channel
length, channel breadth (exclusive, selective, intensive), franchising
policies. Channel coordination and control
 Implementing the Mix
• Promotion
– Advertising, trade and consumer, and retail promotions, sales force
policies, direct marketing, tele marketing, public relations, price
promotions (consumer and trade), trade shows and special events
• Pricing
– Objectives, customization, leadership
– Manufacturer, distributor and retail price, terms and conditions, bidding
tactics, discount policies, Skim versus penetration pricing
 An example
• Out of home advertising (OOH)
• Double growth as compared to traditional media
• Creating awareness was the main use earlier
• Measuring impact was difficult
• Traditional media (TV, newspaper, etc.) not working
• OOH and digital OOH cannot be blocked or fast forwarded
• Static to rotating digital – more ads can be shown
• Some consolidation of supply has happened
• Mobile and geolocation data
• Higher cost on digital platforms
 It’s All About Satisfaction….and creating value

• Applied to virtually all aspects of a company’s

operation
– potential to influence customer satisfaction
• Whenever things of value are being exchanged
– marketing principles apply
• Ultimate goal is customer satisfaction
– leads to long-term profitability and success
• Marketing principles apply in all organizations
 It’s All About Satisfaction….and creating value

• Successful marketing involves

– meeting or exceeding customer expectations
• When expectations are exceeded
– customer satisfaction or delight
• Marketing - adding value
– through a broadly-defined value proposition
• Value
– in many different ways
– not only about price
 Interactions
• Consistency
– Lack of fit between any of the 4 Ps
• Integration
– Positive relationship between the 4 Ps
• Leverage
– Each of the Ps can support the total mix
 Fit
• Program/customer fit
– Developing a program that fits the needs of the customer
• Program company fit
– Marketing program that fits the core competency of the company
• Program/competitor fit
– Protect our weakness, attack competitor weakness
• Competitive response matrix
 Competitive Response Matrix
Company A
Price Quality Advertising
Company B Price Cpp Cqp Cap
Quality Cpq Cqq Caq
Advertising Cap Cqa Caa

• Probability of Company B responding to moves by company A

• Can add more rows and competitors
• Excellent for strategic decisions and role playing
– Reality test of plans viability
– Ability to predict costs and benefits of marketing mix
– Learn more about competition
 Customer value propositions
• Points of parity
• Points of difference
• Points of contention
 Customer value propositions
• All benefits
– All benefits that customers receive
– Why should our firm purchase your offering?
– Good knowledge of own offering
– Asserting benefit offered by supplier
• Favourable point of difference
– All favourable points of difference relative to competition
– Why should our firm purchase your offering compared to competition?
– Knowledge of own and competition benefits
– Feel that value is being added
 Customer value propositions
• Resonating focus
– One of two points of difference and parity – which will offer
greatest value
– What is most worthwhile for our firm to keep in mind about your
offering?
– Knowledge of how own offering delivers superior value
– Requires customer value research
 Not-for-profit Marketing

• Broadening the concept of marketing

• Types of not-for-Profit marketing
– Person marketing
– Place marketing
– Cause marketing
– Event marketing
– Organization marketing
• Characteristics of not-for-Profit Marketing
 Push versus Pull
• Push marketing
• Pull marketing
• When to use which?
 Costs of Marketing
• Single largest item in cost.
• Is it worth it?
• What happens when there is no marketing?
• Who suffers?
• Who gains?