PRINCIPLES OF MARKETING
MARKETING FUNCTION AND CONCEPT OF MARKETING
MICRO MARKETING
Micro
marketing is a strategy used in marketing in which marketing efforts focus on a
small group of consumers. It mainly aims to target a section of customers
wants. It includes the practice of individual marketing where a marketing
message is crafted more personally to a buyer.
Micro marketing emphasize the understanding of markets at the local
level, and also the personalization of messages to individual consumers in the
context direct marketing. It is a
marketing strategy in which advertising efforts are focused on a small group of
highly-targeted consumers. Micro marketing requires a company to narrowly define
a particular audience by a particular characteristic, and tailor campaigns for
that particular segment.
It is a type of marketing strategy that has
to do with targeting specific customers within a niche market. The approach
will often use many of the strategies that are employed in target marketing in
general, in that the marketer will take into account specific attributes that
set the targeted customer apart from other types of clients. One of the key
differences is that target or niche marketing seeks to
focus on reaching a particular group of consumers within that market, while
micromarketing requires personalizing marketing methods to reach a specific client.
With micromarketing, the approach calls for getting to know the client’s
needs, likes, and dislikes very well. This makes it easier to match that
consumer with the goods or services that are being offered. The approach is
often successful because the client receives a sense of being important to the
marketer and sees the efforts to connect as being on a more personal level
rather than a general one.
Small businesses often use micromarketing as a means of establishing and
growing a client base with a defined geographical area. For example, a small
grocery store chain with outlets in three different cities could go with the
more common approach of carrying the same produce in each store. With a
micromarketing approach, each store would carry a core group of fresh produce,
but would augment it with other produce that is of particular interest to
consumers who frequent those individual stores.
Disadvantages: It can be a more expensive technique due to customization
and lack of an economy of scale
MACRO MARKETING
Study of marketing activities, institutions, and processes from the national
(societal) perspective. It looks at
the aggregate flow of goods and services in an economy to determine if it benefits the society in terms of its resource consumption and environmental effects.
Macromarketing literally deals with big/important issues,
beyond comparatively simple exchanges between buyers and sellers, or even
relationships between companies and customers. In a more interconnected world
of markets, marketers, and their stakeholders, macromarketing is an important
mechanism to study both opportunities and shortcomings of marketing, and both
its intended positive effects and unintended deleterious effects. This suggests
macromarketing includes an optimistic perspective; that it seeks functional
mechanisms to enhance marketing processes, to the benefit of the largest number
of stakeholders, the world over.
The concern for macro marketing are market regulation
laws, marketing and social responsibility, socially desirable advertising
techniques, the efficiency of marketing systems, and overall consumer behavior
patterns.
MASS MARKETING
Mass marketing is a marketing philosophy and
method in which a single, wide-ranging marketing strategy is developed to
target the greatest number of people/customers. It is a market coverage
strategy in which a firm decides to ignore market segment differences and
appeal the whole market with one offer or one strategy. The idea is to
broadcast a message that will reach the largest number of people possible.
Traditionally mass marketing has focused on radio, television and newspapers as
the media used to reach this broad audience. By reaching the largest audience
possible exposure to the product is maximized. In theory this would directly
correlate with a larger number of sales or buys into the product.
Mass
marketing is the opposite to Niche marketing as it focuses on high sales
and low prices. Mass Marketing aims to provide products and services that will
appeal to the whole market. Niche marketing targets a very specific segment of
market for example specialized services or goods with few or no competitors.
Benefits
of Mass Marketing
•
Wide
audience - Since the target audience is broad, the number of successful hits is
high despite of the low probability of a single person turning up.
•
Less
risky - If all the efforts in one particular area goes in vain, still the
eventual loss is less compared to a loss in the narrowly focused area.
•
Production
cost per unit are low on account of having one production run for homogeneous
product.
•
Marketing
research cost and advertising cost are relatively low.
•
Higher
potentials of sales volume and efficiency of scale in a much larger market.
RE- MARKETING
Re-marketing refers to the techniques, strategies
and often the automated email systems used by marketers and online
merchants to follow up with website visitors who do not make a desired action
on the Web site, usually it is when they abandon their shopping cart.
It is a feature that lets you reach people who have previously visited
your site, and show them relevant ads across the web or when they search on
Google. When people leave your site without buying anything, remarketing helps
you connect with these potential customers again. You can even show them a
tailored message or offer that will encourage them to return to your site and
complete a purchase.
Remarketing helps an organization/copmany to match the right message to
the right people at the right time. How?: You add a piece of code (remarketing
tag) to all of the pages of your site. Then, when shoppers come to your site,
they will be added to your remarketing lists. You can later reach out to these
potential buyers while they search on Google or browse other websites.
You can use remarketing in multiple ways, depending on the type of site
you have, your business goals, and your campaign type:
Think
of it like this: you use marketing to bring a visitor to your website, and if
he or she doesn't make a purchase, you then use remarketing tactics to bring
the visitor back to your website and convert him or her in to a paying
customer.
People
often refer to ecommerce remarketing services as "conversion
marketing" or "cart abandonment email marketing.
FUNCTIONS
OF MARKETING
Marketing is the process of communicating the value of a product or
service to customers, for the purpose
of selling that product or service.
The
ultimate aim of marketing is exchange of goods and services from producers to
consumers in a way that maximizes the satisfaction of customer’s needs.
Marketing functions start from identifying the consumer needs and end with
satisfying the consumer needs. The universal functions of marketing involve
buying, selling, transporting, storing, standardizing and grading, financing,
risk taking and securing marketing information. However, modern marketing has
some other functions such as gathering the market information and analyzing
that information to assist in product designing and development. The following
are the marketing functions:
1.
Market Information: To identify the needs, wants and demands of the consumers
and then analyzing the identified information to arrive at various decisions
for the successful marketing of a firm’s products and services is one of the
most important functions of marketing. The analysis involves judging the
internal weaknesses and strengths of the organization as well politico-legal,
social and demographic data of the target market. This information is further used
in market segmentations.
2.
Market Planning: Market-planning aims at achieving a firm’s marketing
objectives. These objectives may involve increasing market presence, dominate
the market or increase market share. The market planning function covers aspects
of production levels, promotions and other action programmes. Thus, market
planning involves setting objectives and ways of achieving them.
3.
Exchange Functions: The buying and selling are the exchange functions of
marketing. They ensure that a firm's offerings are available in sufficient
quantities to meet customer demands. The exchange functions are supported by
advertising, personal selling, distribution and sales promotions.
4.
Product Designing and development: The product design helps in making the
product attractive to the target market. In today’s competitive market
environment not only cost matters but also the product design, suitability,
shape, style etc. matter a lot in taking production decisions.
5.
Physical Distribution: The physical distribution functions of marketing involve
transporting and storing. The transporting function involve moving products
from their points of production to locations convenient for purchasers and
storing function involve the warehousing products until needed for sale.
6.
Standardization and Grading: Standardization involves producing goods at
predetermined specifications. Standardization ensures that product offerings
meet established quality and quantity. It helps in achieving uniformity and
consistency in the output product. Grading is classification of goods in
various groups based upon certain predetermined characteristics. It involves
the control standards of size, weight etc. Grading helps in pricing decisions
also. The higher quality goods and services attract higher prices.
7.
Financing : The financing functions of marketing involve providing credit for
channel members or consumers.
8. Risk
Taking: Risk taking is one of the important marketing functions. Risk taking in
marketing refers to uncertainty about consumer purchases resulting from
creation and marketing of goods and services that consumers may purchase in
future.
9.
Packaging, labeling and branding: Packaging involves designing package for the
products, labeling means putting information required / specified on a
product’s covering. Packaging and labeling serve as promotional tools now a
days, Branding distinguishes the generic commodity name to a brand name. In
service industry, also branding matters a lot.
10.
Customer Support: Customer support is a very important function of marketing.
It involves pre sales counseling, after sales service, handling the customer
complaints and adjustments, credit services, maintenance services, technical
services and consumer information. For example, water purifier comes with an
onsite service warranty of 7 years helps in marketing and is an important
marketing function as well.
MARKETING
PROCESS
The
Marketing Process involves identifying the viable and potential marketing
opportunities in the environment, developing strategies to effective utilise
the opportunities, evolving suitable marketing strategies, and supervising the
implementation of these marketing efforts.
Under the marketing concept, the firm must find a way to discover
unfulfilled customer needs and bring to market products that satisfy those
needs. The process of doing so can be modeled in a sequence of steps: the
situation is analyzed to identify opportunities, the strategy is formulated for
a value proposition, tactical decisions are made, the plan is implemented and
the results are monitored.
The Marketing Process
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Situation Analysis
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Marketing Strategy
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Marketing Mix Decisions
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Implementation & Control
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I. Situation Analysis
A thorough analysis of the situation in which the firm finds itself
serves as the basis for identifying opportunities to satisfy unfulfilled
customer needs. In addition to identifying the customer needs, the firm must
understand its own capabilities and the environment in which it is operating.
The situation analysis thus can be viewed in terms an analysis of the
external environment and an internal analysis of the firm itself. The external
environment can be described in terms of macro-environmental factors that
broadly affect many firms, and micro-environmental factors closely related to
the specific situation of the firm.
The situation analysis should include past, present, and future aspects.
It should include a history outlining how the situation evolved to its present
state, and an analysis of trends in order to forecast where it is going. Good
forecasting can reduce the chance of spending a year bringing a product to
market only to find that the need no longer exists.
If the situation analysis reveals gaps between what consumers want and
what currently is offered to them, then there may be opportunities to introduce
products to better satisfy those consumers. Hence, the situation analysis
should yield a summary of problems and opportunities. From this summary, the
firm can match its own capabilities with the opportunities in order to satisfy
customer needs better than the competition.
There are several frameworks that can be used to add structure to the
situation analysis:
•
5 C Analysis - company,
customers, competitors, collaborators, climate. Company represents the internal
situation; the other four cover aspects of the external situation
•
PEST analysis - for macro-environmental
political, economic, societal, and technological factors. A PEST analysis can
be used as the "climate" portion of the 5 C framework.
•
SWOT analysis - strengths, weaknesses,
opportunities, and threats - for the internal and external situation. A SWOT
analysis can be used to condense the situation analysis into a listing of the
most relevant problems and opportunities and to assess how well the firm is
equipped to deal with them.
II. Marketing Strategy
Once the best opportunity to satisfy unfulfilled customer needs is
identified, a strategic plan for pursuing the opportunity can be developed.
Market research will provide specific market information that will permit the
firm to select the target market segment and optimally position the offering
within that segment. The result is a value proposition to the target market.
The marketing strategy then involves:
•
Targeting (target market selection)
•
Positioning the product within the target market
•
Value proposition to the target market
III. Marketing Mix Decisions
Detailed tactical decisions then are made for the controllable
parameters of the marketing mix. The action
items include:
•
Product development - specifying, designing, and producing the first
units of the product.
•
Pricing decisions
•
Distribution contracts
•
Promotional campaign development
IV. Implementation and Control
At this point in the process, the marketing plan has been developed and
the product has been launched. Given that few environments are static, the
results of the marketing effort should be monitored closely. As the market
changes, the marketing mix can be adjusted to accommodate the changes. Often,
small changes in consumer wants can addressed by changing the advertising message.
As the changes become more significant, a product redesign or an entirely new
product may be needed. The marketing process does not end with implementation -
continual monitoring and adaptation is needed to fulfill customer needs
consistently over the long-term.
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