Definitions of MARKETING

The performance of business activities that direct the flow of

goods and services from producer to consumer.
Getting the right goods , to the right people in the right place ,
at the right time , at the right price , with the right level of
communication profitably.
Identifying the needs, wants , desires of consumers and
fulfilling them in such a way that the customer is delighted
and the company objectives are met profitably.
Solving customer problems profitably.

STP

Segmentation: -- is essentially the identification of subsets of buyers

within market who share similar needs and who demonstrate similar
buyer behavior. The world is made up from billions of buyers with
their own sets of needs and behavior. Segmentation aims to match
groups of purchasers with the same set of needs and buyer
behaviors.
Targeting -- After the market has been separated into segments, the
marketer will select a segment or series of segments and target them.
Positioning: is the act of designing the companys offer and image so
that it occupies a distinct and valued place in the target customers
mind.

Requirements for effective segmentation

Measurable : The size , purchasing power and profile of the

segments can be measured. Certain segmentation variables
are difficult to measure. E.g It is difficult to find the size of
segment of teenage smokers who smoke primarily to rebel
against their parents.
Accessible .: The segment can be effectively reached and
served. Suppose a perfume company finds that heavy users
of its brand are single women who are out late at night and
frequent bars . Unless these women live or shop at certain
places and are exposed certain media , they will be difficult
to reach.

Requirements for effective segmentation

Substantial : The segments are large and profitable enough to serve. A
segment should be the largest possible homogeneous group worth going
after with a tailored marketing program. e.g It would not be worthwhile
for an automobile manufacturer to develop cars for persons who are
shorter then 4 feet.
Differentiable : segments are conceptually distinguishable and respond
differently to different marketing mix elements and programs . If married
and unmarried women respond similarly to sale of fur coats , they dont
constitute separate segments.
Actionable : Effective programs can be formulated for attracting and
serving the segments. For e.g A small airline identified 7 market
segments but its staff was too small to develop separate marketing
programs for each segment

SEGMENTATION

Segmentation Base
Geographic

Region
City Size

Climate

Psychographic

Lifestyle

Personality

Variables
North South, East, West
Major Metros, Sub Metros, Town
Hot, cold, humid

Conservative, Status Seekers

Extrovert, Introvert, Aggressive

SEGMENTATION
C) Demographic
Age
Sex
Family Size
Education
Occupation
Income
Religion

0-11,12-19,20-34 etc.
Male, Female
1-2,3-4,5+
school, Graduate, PG
Farmer, Professional,
Housewife, Retired
<15k,16-25k,26-35k etc.
Hindu, Muslim, Sikhs,
Christians

SEGMENTATION
D) Behavioral
Benefit

Use Related
1) Usage Rate:
2) Awareness Status
3) Brand Loyalty

Quality, Service, Economy, Speed,

Prestige.

Heavy, Medium , Light users

Unaware, aware, interested
enthusiastic.
Strong, Medium , None

Use-Situational
Time/Objective

Leisure, work, Morning, Night

Gift, Fun , Achievement

Patterns of target Market Selection

Single Market Concentration
P1

P2

P2M1

P3
M1

M2

M3

Patterns of target Market Selection

Selective Specialisation
P1

P2

P2M1

P2M3
P3M2

P3
M1

M2

M3

Patterns of target Market Selection

Market Specialization
P1

P1M1

P2

P2M1

P3

P3M1
M1

M2

M3

Patterns of target Market Selection

Product Specialisation
P1

P2

P2M1

P2M2

P2M3

P3
M1

M2

M3

Patterns of target Market Selection

Full Coverage
P1

P2

P3
M1

M2

M3

Full Market Coverage

Undifferentiated Marketing -- Coca-cola
Differentiated Marketing-- IBM, G.M, Ford,

Positioning
Positioning starts with the product. But Positioning is not
what you do to a product. Positioning is what you do to the
mind of the prospect.
Easiest way to get into the mind - Be First
KODAK- Photography
Xerox -- Copier
Hertz --- Rent-a car

Positioning

6 STEPS IN POSITIONING PROGRAM

What position do you own
What position do you want to own?
Whom must you outgun
Do you have enough money.
Can you sustain .
Do you match your position.

Positioning Strategies

Attribute Positioning
Benefit Positioning
Use /Application Positioning
User Positioning
Competitor Positioning
Quality / Price Positioning
Product category Positioning

PRODUCT
Defn: A product is anything that can be offered to a market for
attention, acquisition, use or consumption that might satisfy a want or
need.
e.g. :- Physical Goods :-- Cars, W/M
Services
:- Training
Persons
:- Michael Jackson
Ideas
: - Family Planning
Five Levels of Product
Level 1 : Core Benefit : Fundamental benefit that the
customer is buying . E.g. :- Hotel :-Rest,
CTV :- Entertainment

Product
Level 2:- Generic Benefit : Basic version of the product.
e.g. : Hotel : consists of a building with rooms.
W/M : Metal/plastic body with console
panel
Level 3 : Expected Product : A set of attributes and
conditions that buyers normally expect and agree when
they purchase the product.
e.g. : Hotel : Clean Bed, soap, towels,
telephone
CTV : Tuning on remote, cable ready.

Product
Level 4 : Augmented Product : includes additional services and
benefits that distinguishes the companys offer from
competitors offers.
e.g. : Hotel : Complimentary breakfast, Flat CTV,
24 Hrs checkout, etc.
Level 5: Potential Product: All augmentations and
transformations that the product might ultimately undergo in
the future.
e.g. : Computer compatible TV (which can operate at room
temperatures)

Product width : Different Product categories the company is in

Product Length : In each product category how many products
are available
Product depth : Variants that are offered for each product.

Product Strategies
1) Downward Stretch
2) Upward Stretch
3) Two-way Stretch

BRANDING
Defn:- A name ,symbol, design which is intended to
identify the goods ,services of one company and to
differentiate the goods from those of competitors.
BRAND NAME DECISION

Individual Brand Name : P & G :- Ariel, Pantene

A Blanket Family Name : Philips
Company Name combined with individual product names:Britannia 50-50
Videocon Bazoomba

PRICING Srategies
Differential Pricing : Same brand is sold at different
prices/different times to consumers.
Competitive Pricing : Prices are set to exploit competitive
position.
Product Line Pricing : Related brands are sold at prices
that
exploit mutual dependencies.
Promotional pricing :

Promotion

Advertising
Sales Promotion
Personal Selling
PR and publicity
Direct marketing

Promotion
Advertising : is any paid form of non personal presentation and promotion
of ideas goods, services by an identified sponsor
Direct Marketing : Use of mail, telephone and other non personal contact
tools to communicate with or solicit a response from specific customers and
prospects.
Sales Promotion : Short term incentives to encourage trial or purchase of a
product/service
PR : A variety of programs designed to promote and protect a companys
image or its individual products.
Personal selling : Face to face interaction with one or more prospective
purchasers for the purpose of making sales.

Sales promotion
Consumer Promotion
(Manufacturer point of view)
To increase sales of self brand
To divert attention from competition brands.
Enables manufacturers to adjust to periods of low demand.
Induce customers to try new products/brands.
Customer point of view.
Enables customers to have a better understanding of real prices.
Consumers feel good that they get value for money deals.

Sales Promotion
Consumer Promotion Tools:
Samples : Free samples with TOI , Mid-day, Filmfare.
Coupons: FMCG companies: 15% discount coupon or some
rupees off for the next purchase.
Price Packs: Pack of 2 or more at reduced price.
Banded Pack : Two related products banded together
(toothpaste with toothbrush, VCD player with software.)
Contests : Answer a few questions, write a slogan.
Free Trials: Free auto drives.
Warranties: 3 yr on CTV, 7 yrs on compressor.

Sales Promotion

Scratch n win offer:

Money back offer
Loyalty promotion: Frequent Flyer programs
Cross promotion: Two related product categories
promoting together , mostly the second product is free.
Tie-in promotion : used in conjunction with consumer
durables wherein total is lower then if bought separately.

Distribution
Retailing : Consists of the activities involved in selling
goods and services to ultimate consumers. A retail sale is
one in which the buyer is an ultimate consumer and the
buying motive for a retail sale is always personal or family
satisfaction derived from the final consumption of item
being purchased.
Wholesalers: Wholesaling is concerned with the activities
of those persons or establishments which sell to retailers
and other merchants , and/or to industrial , institutional and
commercial users , but who dont sell in significant amount
to ultimate consumers.

Distribution Strategies
EXCLUSIVE DISTRIBUTION : Distributing through
company outlets or franchisee e.g. : HONDA Showrooms:only company products are available.
INTENSIVE DISTRIBUTION : Placing the products in
as many outlets as possible.
Products : Soaps, cigarettes, soft drinks ( each outlet has
various brands

Distribution Strategies
SELECTIVE DISTRIBUTION :
Here companies select a combination of Exclusive
distribution (only companys products) & Intensive
Distribution (some important outlets which are multibrand
outlets)
e.g. SAMSUNG , VIDEOCON