BRAC University

BRAC Business School

EMBA Program (Fall 2019)

Welcome

Marketing Principles and Practices (MKT 701)

Week 1 Lecture

1
Marketing Defined

A social and managerial process whereby individuals

and groups obtain what they need and want through

creating and exchanging products and value with others.

2
Core marketing concepts

Needs, Wants,
and Demands

Markets Core Products and

Marketing Services
Concepts

Exchange, Value,
Transactions, Satisfaction,
and relationships

3
Needs, Wants and Demands

Needs States of felt deprivation.

Needs

Wands The form taken by human needs as

Wands
They are shaped by culture and individual
personality.
Demands
Demands
 Human wants that are backed by
buying power .

4
Product and Service

Product

 Anything that can be offered to a market

for attention, acquisition, use, or consumption that
might satisfy a want or need.
Service

 Any activity or benefit that one party can

offer to another that is essentially intangible and
does not result in the ownership of anything.

5
Value, Satisfaction

Customer value

The difference between the values the customer gains

from owning and using a product and the cost of
obtaining the product.

Customer satisfaction

The extent to which a product’s perceived performance

matches a buyer’s expectations.

6
Exchange, Transaction and Relationships

Exchange

The act of obtaining a desired object from someone by offering

something in return.

Transactions

A trade between tow parties that involves at least tow things of

agreement, and a place of agreement.

7
Marketing management philosophies

Production concept

Product concept

Selling concept

Marketing concept

Social marketing concept

8
Production Concept
 The philosophy that:

 Consumers will favour products that are available and

highly affordable

 Management should therefore focus on improving

production and distribution efficiency.

9
Product Concept

 The philosophy that:

 Consumers will favour products that offer the most quality,

performance, and innovative features.
 Marketers should emphasize on improving product quality,
performance and features.

10
Selling Concept
 The idea that:

 Consumers will not buy enough of the organization’s

products unless the organization undertakes a large – scale
selling and promotion effort.

 Marketing managers’ task are to undertake effective

selling & promotional efforts.

11
Marketing Concept
 The marketing management philosophy that:

 Achieving organizational goals depends on determining the

needs and wants of target markets.

 Delivering the desired satisfactions more effectively and

efficiently than competitors do.

 Marketing managers’ tasks are to identify the needs and wants

of target customers & satisfy that needs more efficiently.

12
Societal Marketing Concept

 The idea that:

 The organization should determine the needs, wants, and

interests of target markets and deliver the desired
satisfactions more effectively and efficiently than competitors
in a way that maintains or improves the consumer’s needs
and society’s well – being.

13
 Marketing challenges into the new century

Growth of non-profit marketing

The information technology boom

Rapid globalization

The changing world economy

The call for more ethics and social responsibility

14
 BRAC University
BRAC Business School
EMBA Program (Fall 2019)

Welcome

Marketing Principles and Practices (MKT 701)

Week 2 Lecture

16
 Demand States
The different states of demand with the corresponding tasks facing
the marketing manager are as follows:

Negative Demand Irregular Demand

Unwholesome Demand
No Demand
Full Demand
Latent Demand Overfull Demand

Declining Demand
 Demand states & corresponding
marketing tasks
1. Negative Demand:
•Market dislike the product

•Strong objection against production, distribution, and use of the

product.
•Whether the product is beneficial or harmful is not the question,

but for any reason, customers want to avoid the product.

•Even, they are ready pay price to avoid the product.

18
 Continue……………….

Marketing Tasks:
finding the reasons for negative demand

convincing the people regarding uses and benefits of products.

‘Conversion Marketing’

19
 2. No Demand
customers are not buying the product.

they do not know about the product.

for example, Five Star Hotel in tribal area.

Marketing Tasks:

connect the uses and benefits of the product with

person’s natural needs.

Exhibition, demonstration, free trial of product, free

samples.
‘Creative Marketing’ or ‘Stimulating Marketing’
20
 3. Latent Demand
means hidden or invisible demand.
exiting products lack desirable attributes.
people expect superior product.
Marketing Tasks:
estimate total latent demand and production costs.

if feasible, marketers should produce and market such

products.
‘Development Marketing’

21
4. Declining or Falling Demand……
demand for goods and services is less and falling

continuously.
this is due to change in fashion, taste, technology, customer

behaviour, or innovation.
Marketing Tasks:
making minor or major changes in the existing product.

changes include improving qualities, changing attributes,

and/or excelling performance.

‘Re-marketing’
22
 5. Irregular Demand

demand for the product experiences variations (ups and

downs) continuously.
Marketing Tasks:
formulate appropriate marketing strategies to regulate or

balance demand fluctuations.

‘Synchromarketing’

23
6. Unwholesome Demand

products are not desirable for customers or society at large.

Marketing Tasks:
restricting production, distribution, and consumption of such

products.
‘Counter Marketing’

24
 7. Full Demand
demand is adequate or at desired level.
company is satisfied with volume of sales and its position in
market.
Marketing Tasks:
watch on changing fashion, attitudes, interest, and wants of

customers.
required changes should be made to cope with the future

changes in advance.
‘Maintenance Marketing’

25
 8. Overfull Demand
demand is more than firm’s capacity.

not possible for the company to meet.

short supply, or because of difficulty in distribution

Marketing Tasks:

price rise or quality reduction

educating people

rationing of products
‘De-marketing’

26
 The Company’s Macroenvironment
Demographic Environment
Demography is the study of human populations in terms
of size, density, location, age, gender, race, occupation, and
other statistics.

Demographic environment is important because it

involves people, and people make up markets.

Demographic trends include age, family structure,

geographic population shifts, educational
characteristics, and population diversity
 The Company’s Macroenvironment
Demographic Environment
Changing age structure of the population
Baby boomers include people born between 1946 and 1964
1. Strong work ethic.
2. Self-Assured. This generation is independent and self-
assured. ...
3. Competitive. Baby boomers like competition. ...
4. Goal-centric. ...
5. Resourceful. ...
6. Mentally focused. ...
7. Team oriented. ...
8. Disciplined.
 The Company’s Macroenvironment
Demographic Environment

Generation X includes people born between 1965 and 1976

High parental divorce rates
Cautious economic outlook
Less materialistic
Family comes first
Lag behind on retirement savings
The Company’s Macroenvironment
Demographic Environment

More people are:

Divorcing or separating
Choosing not to marry
Choosing to marrying later
Marrying without intending to have children
Increased number of working women
Stay-at-home dads
The Company’s Macroenvironment
Demographic Environment

Changes in the workforce

More educated
More white collar
 The Company’s Macroenvironment
Economic Environment

Economic environment consists of factors that affect

consumer purchasing power and spending patterns.

Changes in income
Value marketing involves ways to offer financially cautious
buyers greater value—the right combination of quality and
service at a fair price
The Company’s Macroenvironment
Economic Environment
Changes in Consumer Spending Patterns

Ernst Engel—Engel’s Law

As income rises:
The percentage spent on food declines
The percentage spent on housing remains constant
The percentage spent on savings increases
 The Company’s Macroenvironment
Natural Environment

Natural environment involves the natural resources that are

needed as inputs by marketers or that are affected by
marketing activities
Trends
Shortages of raw materials
Increased pollution
Increase government intervention
Environmentally sustainable strategies
The Company’s Macroenvironment
Technological Environment

Most dramatic force in changing the marketplace

Creates new products and opportunities
Safety of new product always a concern
The Company’s Macroenvironment
Political Environment

Political environment consists of laws, government

agencies, and pressure groups that influence or
limit various organizations and individuals in a
given society
The Company’s Macroenvironment
Political Environment

Legislation regulating business

Increased legislation
Changing government agency enforcement
Increased emphasis on ethics
Socially responsible behavior
Cause-related marketing
The Company’s Macroenvironment
Cultural Environment

Cultural environment consists of institutions and

other forces that affect a society’s basic values,
perceptions, and behaviors
 Responding to the Marketing
Environment
Views on Responding

Uncontrollable Proactive Reactive

• React and • Aggressive • Watching and
adapt to actions to reacting to
forces in the affect forces forces in the
environment in the environment
environment
 BRAC University
BRAC Business School
EMBA Program (Fall 2019)

Welcome

Marketing Principles and Practices (MKT 701)

Week 3 Lecture

40
 Characteristics Affecting
Consumer Behavior
Cultural Factors Social Factors
Buyer’s culture Reference groups
Buyer’s subculture Family
Buyer’s social class Roles and status

5-41
 Characteristics Affecting
Consumer Behavior
Personal Factors Psychological Factors
Age and life-cycle stage Motivation
Occupation Perception
Economic situation Learning
Lifestyle Beliefs and attitudes
Personality and self-
concept

5-42
 Customer Decision Process Model
Post
Purchase
Pre-Purchase state purchase
stage
stage

Evaluation Post-
Problem Information
Stimulus of Choice purchase
awareness search
alternatives evaluation
· Company · Internal · Buying
cue · Using
· Physical · External · Disposin
cue g
· Social · Multiattri
cue bute
Model
· Shortage · Evaluatio
· Unfulfilled n of
desire satisfacti
on
 The Buyer Decision Process for
New Products
Stages in the Adoption Process

• Awareness is when the consumer becomes aware of

the new product but lacks information.
• Interest is when the consumer seeks information
about the new product.

5-44
 The Buyer Decision Process for
New Products
Stages in the Adoption Process
• Evaluation is when the consumer considers
whether trying the new product makes sense.
• Trial is when the consumer tries the new product
to improve his or her estimate of value.
• Adoption is when the consumer decides to make
full and regular use of the product.

5-45
 The Buyer Decision Process for
New Products
Individual Differences in Innovation
• Early adopters are opinion leaders and adopt new ideas early
but cautiously.

• Early majority are deliberate and adopt new ideas before

the average person.

• Late majority are skeptical and adopt new ideas only after the
majority of people have tried it.

• Laggards are suspicious of changes and adopt new ideas only

when they become tradition.
5-46
 The Buyer Decision Process for
New Products
Individual Differences in Innovation

5-47
 BRAC University
BRAC Business School
EMBA Program (Fall 2019)

Welcome

Marketing Principles and Practices (MKT 701)

Week 5 Lecture

49
Bases of Market Segmentation

Geographic Segmentation

Demographic Segmentation

Psychographic Segmentation

Behavior Segmentation
©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition
Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens
Geographic Segmentation

Dividing the market into different geographic

units

Nations
States
Regions
Counties
Cities
Neighborhoods

©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition
Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens
Demographic Segmentation
Dividing the market into groups based on
demographic variables
Age
Gender
Income
Occupation

©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition
Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens
Psychographic Segmentation
Dividing buyers into different groups based on social
class, lifestyle, and personality characteristics

©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition
Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens
 Behavior Segmentation
Buyers are divided into groups based on their
knowledge, attitude, and use or response to a product
The best starting point for building market segments
Types
Special occasion segmentation
Benefits sought
User status
Usage rate
Loyalty status
Buyer readiness stage

©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition
Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens
Requirements for Effective Segmentation

Measurable
Measurable • Size, purchasing power, profiles
of segments can be measured.

Accessible
Accessible • Segments can be effectively
reached and served.

Substantial • Segments are large or profitable

Substantial enough to serve.

• Effective programs can be designed

Actionable
Actionable to attract and serve the segments.

©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition
Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens
Selecting the Right Competitive Advantages

Avoid:
Underpositioning
Overpositioning
Confused positioning

©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition
Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens