DIPLOMA IN ENGINEERING

NOWGONG POLYTECHNIC
6TH SEMESTER
INDUSTRIAL MANAGEMENT & ENTREPRENEURSHIP – Hu – 601
UNIT 7 -MARKETING MANAGEMENT

Marketing tries to know and understand the customers and the product or services offered by
the firm/market. There is no doubt that marketing is concerned with customer satisfaction.
Marketing is also concerned with the harnessing of the firms' resources and focussing of these
resources upon the most appropriate opportunities. Thus, the simplest definition of marketing
is that it 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 organisation's resources to
ensure that the customer is satisfied at a profit to the business.

The professional definition of marketing as approved by American Marketing

Association

"Marketing is the process of planning and executing the conception, pricing, promotion, and
distribution of ideas, goods and services to create exchange that satisfy individual and
organisational objectives."

Thus Marketing is conceived as a management process responsible for anticipating and

satisfying customer needs - at a profit. A delightfully simple description of marketing is that
"it is a way of making it easier for customer to do business with you"

BENEFITS OF MARKETING CONCEPT

1. Marketing concept forces business firms to use an integrated approach in their operations.

2. Marketing concept enables the business firm to move quickly to capitalise on marke
opportunities.

3. An enterprise can be successful in the long run only if it recognises that of the market or
customer are paramount. the needs

DIFFICULTIES IN IMPLEMENTATION OF MARKETING CONCEPT :

1. Consumer preferences vary widely.

2. Many customers are inconsistent in stating their preferences and needs.

3. Many customers do not know, what they want, until they are presented with reasonably
specific choices.
THE SOCIETAL MARKETING CONCEPT.

The societal marketing concept holds that the organizational task is to determine the needs,
wants and interests of target markets and to deliver the desired satisfaction more effectively
and efficiently than competitors in a way that preserves or enhances the consumers and the
society's well-being.

FEATURES OF MARKETING

1. Needs and Wants: The process of marketing helps individuals and groups in obtaining
what they need and want. Thus, the primary reason or motivation for people to engage
in the process of marketing is to satisfy some of their needs or wants. In other words,
the focus of the marketing process is on satisfaction of the needs and wants of
individuals and organisations.
2. Creating a Market Offering: On the part of the marketers, the effort involves creation
of a ‘market offering. Market offering refers to a complete offer for a product or service,
having given features like size, quality, taste, etc; at a certain price; available at a given
outlet or location and so on.
3. Customer value: The buyers make buying decisions on their perceptions of the value
of the product or service in satisfying their need, in relation to its cost. A product will
be purchased only if it is perceived to be giving greatest benefit or value for the money.
The job of a marketer, therefore, is to add to the value of the product so that the
customers prefer it in relation to the competing products and decide to purchase it.
4. Exchange Mechanism: The process of marketing works through the exchange
mechanism. The individuals (buyers and sellers) obtain what they need and want
through the process of exchange. In other words, the process of marketing involves
exchange of products and services for money or something considered valuable by the
people

MARKETING MANAGEMENT

Marketing management means management of the marketing function. In other words,

marketing management refers to planning, organising, directing and control of the activities
which facilitate exchange of goods and services between producers and consumers or users of
products and services. Thus the focus of marketing management is on achieving desired
exchange outcomes with the target markets. Taking a management perspective, the term
marketing has been defined as “the process of planning and executing the conception, pricing,
promotion and distribution of ideas, goods and services to create exchanges that satisfy
individual and organisational goals

Marketing Management is the process of planning, organizing, implementing, and controlling

marketing activities to achieve organizational goals. It involves identifying customer needs,
creating value, and delivering it effectively to build strong customer relationships and
maximize profits.

IMPORTANCE OF MARKETING MANAGEMENT

 Helps identify customer needs and preferences.

 Boosts sales and revenue by promoting products effectively.
 Enhances customer loyalty and retention.
  Enables businesses to stay competitive.
 Supports decision-making with data-driven insights.

FUNCTIONS OF MARKETING

1. Gathering and analysing Market information: One of the important functions of a

marketer is to gather and analyse market information. This is necessary to identify the
needs of the customers and take various decisions for the successful marketing of the
products and services. This is important for making an analysis of the available
opportunities and threats as well as strengths and weaknesses of the organisation and
help in deciding what opportunities can best be pursued by it. For example, rapid
growth is predicted in several areas in the Indian economy, say in the use of the Internet,
market for cell phones and several other areas. Which of these areas a particular
organisation should enter, or in which area should it expand, requires a careful scanning
of the strengths and weaknesses of the organisation, which is done with the help of
careful market analysis.
2. Marketing Planning: Another important activity or area of work of a marketer is to
develop appropriate marketing plans so that the marketing objectives of the
organisation can be achieved.
3. Product Designing and Development: Another important marketing activity or
decision area relates to product designing and development. The design of the product
contributes to making the product attractive to the target customers
4. Standardisation and grading: Standardisation refers to producing goods of
predetermined specifications, which helps in achieving uniformity and consistency in
the output. Standardisation ensures the buyers that goods conform to the predetermined
standards of quality, price and packaging and reduces the need for inspection, testing
and evaluation of the products.
Grading is the process of classification of products into different groups, on the basis
of some of its important characteristics such as quality, size, etc. Grading is particularly
 necessary for products which are not produced according to predetermined
specifications, such as in the case of agricultural products, say wheat, oranges, etc.
5. Packaging and Labelling: Packaging refers to designing and developing the package
for the products. Labelling refers to designing and developing the label to be put on the
package. The label may vary from a simple tag to complex graphics.
6. Branding: A very important decision area for marketing of most consumer products is
whether to sell the product in its generic name (name of the category of the product,
say Fan, Pen, etc.) or to sell them in a brand name (such as Pollar Fan or rottomac Pen).
Brand name helps in creating product differentiation, i.e., providing basis for
distinguishing the product of a firm with that of the competitor, which in turn, helps in
building customer’s loyality and in promoting its sale.
7. Customer support services: A very important function of the marketing management
relates to developing customer support services such as after sales services, handling
customer complaints and adjustments, procuring credit services, maintenance services,
technical services and consumer information.
8. Pricing of Product: Price of product refers to the amount of money customers have to
pay to obtain a product. Price is an important factor affecting the success or failure of a
product in the market.
9. Promotion: Promotion of products and services involves informing the customers
about the firm’s product, its features, etc., and persuading them to purchase these
products. The four important methods of promotion include advertising, Personal
Selling, Publicity and Sales Promotion.
10. Physical Distribution: Managing physical distribution is another very important
function in the marketing of goods and services. The two major decision areas under
this function include (a) decision regarding channels of distribution or the marketing
intermediaries (like whole salers, retailers) to be used and (b) physical movement of the
product from where it is produced to a place where it is required by the customers for
their consumption or use.
11. Transportation: Transportation involves physical movement of goods from one place
to the other. As generally the users of products, particularly consumer products are wide
spread and geographically separated from the place these are produced, it is necessary
to move them to the place where it is needed for consumption or use.
12. Storage or Warehousing: Usually there is a time gap between the production or
procurement of goods and their sale or use. It may be because of irregular demand for
the products.

MARKETING MIX

The marketing mix consists of various elements, which have broadly been classified into
four categories, popularly known as four Ps of marketing. These are: (i) Product, (ii) Price,
(iii) Place, and (iv) Promotion. These are briefly discussed as follows: 1. Product: Product
means goods or services or ‘anything of value’, which is offered to the market for sale.

1. PRODUCT MIX - The concept of product relates to not only the physical product as
mentioned in the above examples but etc. These aspects are very important, particularly
in the marketing of consumer durable products (like Automobiles, refrigerators, etc.).
The important product decisions include deciding about the features, quality,
packaging, labelling and branding of the products. also the benefits offered by it from
customer’s view point (for example toothpaste is bought for whitening teeth,
strengthening gums, etc.). The concept of product also include the extended product or
 what is offered to the customers by way of after sales services, handling complaints,
availability of spare parts.
2. PRICE MIX: Price is the amount of money customers have to pay to obtain the
product. In case of most of the products, level of price affects the level of their demand.
The marketers have not only to decide about the objectives of price setting but to
analyse the factors determining the price and fix a price for the firm’s products.
3. PLACE MIX: Place or Physical Distribution include activities that make firm’s
products available to the target customers. Important decision areas in this respect
include selection of dealers or intermediaries to reach the customers, providing support
to the intermediaries (by way of discounts, promotional campaigns, etc.).
4. PROMOTION MIX: Promotion of products and services include activities that
communicate availability, features, merits, etc., of the products to the target customers
and persuade them to buy it.

📊 E-BUSINESS

If the term business is taken to mean a wide range of activities comprising industry, trade and
commerce; e-business may be defined as the conduct of industry, trade and commerce using
the computer networks, i.e. internet. Though, many a times, the terms e-business and e-
commerce are used interchangeably, yet more precise definitions would distinguish between
the two. Just as the term ‘business’ is a broader term than ‘commerce’, e-business is a more
elaborate term and comprises various businesses done through electronic medium whereas, e-
Commerce relates to the transactions and functions conducted electronically, including the
more popular gamut of transactions called ‘e-commerce.’ e-commerce covers a firm’s
interactions with its customers and suppliers over the internet.
E-business includes not only e-commerce, but also other electronically conducted business
functions such as production, inventory management, product development, accounting and
finance and human resource management. e-business is, therefore, clearly much more than
buying and selling over the Internet, i.e., e-commerce.
SCOPE OF E-BUSINESS
(i) B2B Commerce: Here, both the parties involved in e-commerce transactions are
business firms, and, hence the name B2B, i.e., business to-business (see Figure 5.1). Creation
of utilities or delivering value requires a business to interact with a number of other business
firms which may be suppliers or vendors of diverse inputs; or else they may be a part of the
channel through which a firm distributes its products to the consumers.
(ii) B2C Commerce: As the name implies, B2C (business-to-customers) transactions have
business firms at one end and its customers on the other end. Although, what comes to one’s
mind instantaneously is online shopping, it must be appreciated that ‘selling’ is the outcome of
the marketing process. And, marketing begins well before a product is offered for sale and
continues even after the product has been sold.
(iii) Intra-B Commerce: Here, parties involved in the electronic transactions are from
within a given business firm, hence, the name intra-B commerce. As noted earlier too, one
critical difference between e-commerce and e-business is that, e-commerce comprises a
business firm’s interaction with its suppliers, and distributors/other business firms (hence, the
name B2B) and customers (B2C) over the internet.
(iv) C2C Commerce: Here, the business originates from the consumer and the ultimate
destination is also consumers, thus the name C2C commerce (see Figure 5.2). This type of
commerce is best suited for dealing in goods for which there is no established market
mechanism, for example, selling used books or clothes either on cash or barter basis.
BENEFITS OF E-BUSINESS
(i) Ease of formation and lower investment requirements: Unlike a host of procedural
requirements for setting up an industry, e-business is relatively easy to start. The benefits of
internet technology accrue to big or small business alike. In fact, Internet is responsible for the
popularity of the phrase: ‘networked individuals and firms are more efficient than networthed
individuals.’ This means that even if you do not have much of the investment (networth) but
have contacts (network), you can do fabulous business.
(ii) Convenience: Internet offers the convenience of ‘24 hours × 7 days a week × 365 days’
a year.
(iii) Speed: As already noted, much of the buying or selling involves exchange of
information that Internet allows at the click of a mouse.
(iv) Global reach/access: Internet is truly without boundaries. On the one hand, it allows
the seller an access to the global market; on the other hand, it affords to the buyer a freedom to
choose products from almost any part of the world.
LIMITATIONS OF E-BUSINESS
Doing business in the electronic mode suffers from certain limitations. It is advisable to be
aware of these limitations as well.
(i) Low personal touch: High-tech it may be, e-business, however, lacks warmth of
interpersonal interactions. To this extent, it is relatively less suitable mode of business in
respect of product categories requiring high personal touch such as garments, toiletries, etc.
(ii) Incongruence between order taking/giving and order fulfilment speed: Information
can flow at the click of a mouse, but the physical delivery of the product takes time. This
incongruence may play on the patience of the customers. At times, due to technical reasons,
web sites take unusually long time to open. This may further frustrate the user.
(iii) Need for technology capability and competence of parties to e-business: Apart from
the traditional 3R’s (Reading, WRiting, and ARithmetic), e-business requires a fairly high
degree of familiarity of the parties with the world of computers.
(iv) Increased risk due to anonymity and non-traceability of parties: Internet
transactions occur between cyber personalities. As such, it becomes difficult to establish the
identity of the parties. Moreover, one does not know even the location from where the parties
may be operating. It is riskier, therefore, transacting through internet. e-business is riskier also
in the sense that there are additional hazards of impersonation (someone else may transact in
your name) and leakage of confidential information such as credit card details. Then, there also
are problems of ‘virus,’ and ‘hacking,’ that you must have heard of. If not, we will be dealing
with security and safety concerns of online business.
(v) People resistance: The process of adjustment to new technology and new way of doing
things causes stress and a sense of insecurity. As a result, people may resist an organisation’s
plans of entry into e-business.
(vi) Ethical fallouts: “So, you are planning to quit, you may as well quit right now”, said
the HR manager showing her a copy of the e-mail that she had written to her friend. Sabeena
was both shocked and stunned as to how her boss got through to her e-mail account. Nowadays,
companies use an ‘electronic eye’ to keep track of the computer files you use, your e-mail
account, the websites you visit etc. Is it ethical?

DISTRIBUTION CHANNELS

A channel of distribution refers to the path through which goods and services travel from the
producer or manufacturer to the final consumer. It includes a network of intermediaries such
as distributors, wholesalers, retailers, and agents.

The primary objective of distribution channels is to:

 Ensure availability of products at the right place.

 Facilitate efficient movement of goods.
 Provide convenience to customers.
 Optimize cost and time in delivering products.

🔥 2. TYPES OF DISTRIBUTION CHANNELS

A) Direct Distribution Channel –

 ZERO-LEVEL CHANNEL

 Definition: Involves no intermediaries; the manufacturer sells directly to the consumer.

PRODUCER → CONSUMER

 Methods:
o Company-owned stores
o Online platforms (Direct-to-Consumer or D2C)
o Door-to-door sales
 Examples:
o Apple selling directly through its official website.
o Amul parlors selling products directly to consumers.
 Advantages:
o Higher profit margins (no middlemen costs).
o Direct customer feedback.
o Better control over pricing and customer service.
 Disadvantages:
o Limited market reach.
o Higher marketing and distribution costs.

B) Indirect Distribution Channel

 Definition: Involves one or more intermediaries between the producer and consumer.
 Types:

1. ONE-LEVEL CHANNEL

PRODUCER → RETAILER → CONSUMER

 o
Examples:
 Fashion brands like Zara selling through their own retail stores.
 Electronics brands like Samsung selling through large retailers.
o Advantages:
 Wider customer reach.
 Lower marketing and logistics costs for manufacturers.
o Disadvantages:
 Profit margins are shared with retailers.
 Reduced control over customer relationships.
2. TWO-LEVEL CHANNEL

PRODUCER → WHOLESALER → RETAILER → CONSUMER

o
Examples:
 FMCG products (soap, shampoo, biscuits).
 Packaged foods.
o Advantages:
 Increased market coverage.
 Lower inventory and logistics burden on manufacturers.
o Disadvantages:
 Reduced profit margins.
 Lesser control over pricing.
3. THREE-LEVEL CHANNEL

PRODUCER → AGENT → WHOLESALER → RETAILER →

CONSUMER

o Examples:
 Pharmaceuticals.
 Large-scale industrial products.
o Advantages:
 Extensive market reach.
 Efficient handling of large volumes.
o Disadvantages:
 High distribution costs.
 Delays in product delivery.

WHOLESALE TRADE

Wholesale trade refers to buying and selling of goods and services in large quantities for the
purpose of resale or intermediate use. 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 do not sell in significant amount to ultimate
consumers. Wholesalers serve as an important link between manufacturers and retailers. They
enable the producers not only to reach large number of buyers spread over a wide geographical
area (through retailers), but also to perform a variety of functions in the process of distribution
of goods and services.
SERVICES OF WHOLESALERS

A. Services to Manufacturers

Major services offered by wholesalers to the producers of goods and services are given as
below:

(i) Facilitating large scale production: Wholesalers collect small orders from a number
of retailers and pass on the pool of such orders to the manufacturers and make purchases in
bulk quantities. This enables the producers to undertake production on a large scale and take
advantage of the economies of scale.
(ii) Bearing risk: The wholesale merchants deal in goods in their own name, take delivery
of the goods and keep the goods purchased in large lots in their warehouses. In the process,
they bear variety of risks such as the risk of fall in prices, theft, pilferage, spoilage, fire, etc. To
that extent, they relieve the manufacturers from bearing these risks.
(iii) Financial assistance: The wholesalers provide financial assistance to the
manufacturers in the sense that they generally make cash payment for the goods purchased by
them. To that extent, the manufacturers need not block their capital in the stocks. Sometimes
they also advance money to the producers for bulk orders placed by them.
(iv) Expert advice: As the wholesalers are in direct contact with the retailers, they are in a
position to advice the manufacturers about various aspects including customer’s tastes and
preferences, market conditions, competitive activities and the features preferred by the buyers.
They serve as an important source of market information on these and related aspects.
(v) Help in marketing function: The wholesalers take care of the distribution of goods to
a number of retailers who, in turn, sell these goods to a large number of customers spread over
a large geographical area. This relieves the manufacturers from many of the marketing
activities and enable them to concentrate on the production activity.
(vi) Facilitate production continuity: The wholesalers facilitate continuity of production
activity throughout the year by purchasing the goods as and when these are produced and
storing them till the time these are demanded by retailers or consumers in the market.
(vii) Storage: Wholesalers take delivery of goods when these are produced in factory and
keep them in their godowns/warehouses. This reduces the burden of manufacturers of
providing for storage facilities for the f inished products. They thus provide time utility.

B. Services to Retailers

(i) Availability of goods: Retailers have to maintain adequate stock of varied commodities
so that they can offer variety to their customers. The wholesalers make the products of various
manufacturers readily available to the retailers. This relieves the retailers of the work of
collecting goods from several producers and keeping big inventory of the same.
(ii) Marketing support: The whole salers perform various marketing functions and
provide support to the retailers. They undertake advertising and other sales promotional
activities to induce customers to purchase the goods. The retailers are benefitted as it helps
them in increasing the demand for various new products.
(iii) Grant of credit: The wholesalers generally extend credit facilities to their regular
customers. This enables the retailers to manage their business with relatively small amount of
working capital.
(iv) Specialised knowledge: The wholesalers specialise in one line of products and know
the pulse of the market. They pass on the benefit of their specialised knowledge to the retailers.
They inform the retailers about the new products, their uses, quality, prices, etc. They may also
advise them on the decor of the retail outlet, allocation of shelf space and demonstration of
certain products.
(v) Risk sharing: The wholesalers purchase in bulk and sell in relatively small quantities
to the retailers. Being able to purchase merchandise in smaller quantities, retailers are in a
position to avoid the risk of storage, pilferage, obsolescence, reduction in prices and demand
fluctuations in respect of larger quantites of goods that they would have to purchase in case the
services of wholesalers are not available.

RETAIL TRADE

A retailer is a business enterprise that is engaged in the sale of goods and services directly to
the ultimate consumers. The retailer normally buys goods in large quantities from the
wholesalers and sells them in small quantities to the ultimate consumers. The retails represents
the final stage in the distribution where goods are transferred from the hands of the
manufacturers or wholesalers to the f inal consumers or users. Retailing is, thus, that branch of
business which is devoted to the sale of goods and services to the ultimate consumers for their
personal and non-business use.

SERVICES OF RETAILERS

Retailers serve as an important link between the producers and final consumers in the
distribution of products and services. They provide useful services to the consumers,
wholesalers and manufacturers. Some of the important services of retailers are described as
below:

A. Services to Manufacturers and Wholesalers:

(i) Help in distribution of goods: A retailer’s most important service to the wholesalers
and manufacturers is to provide help in the distribution of their products by making these
available to the final consumers, who may be scattered over a large geographic area. They thus
provide place utility.
(ii) Personal selling: In the process of sale of most consumer goods, some amount of
personal selling effort is necessary. By undertaking personal selling efforts, the retailers relieve
the producers of this activity and greatly help them in the process of actualising the sale of the
products.
(iii) Enabling large-scale operations: On account of retailer’s services, the manufacturers
and wholesalers are freed from the trouble of making individual sales to consumers in small
quantities. This enables them to operate on, at relatively large scale, and thereby fully
concentrate on their other activities.
(iv) Collecting market information: As retailers remain in direct and constant touch with
the buyers, they serve as an important source of collecting market information about the tastes,
preferences and attitudes of customers. Such information is considered very useful in taking
important marketing decisions in an organisation.
(v) Help in promotion: From time-to-time, manufacturers and distributors have to carry
on various promotional activities in order to increase the sale of their products. For example,
they have to advertise their products and offer short-term incentives in the form of coupons,
free gifts, sales contests, and so on. Retailers participate in these activities in various ways and,
thereby, help in promoting the sale of the products.
B. Services to Consumers

i. Regular availability of products: The most important service of a retailer to

consumers is to maintain regular availability of various products produced by different
manufacturers. This enables the buyers to buy products as and when needed.
ii. New products information: By arranging for effective display of products and through
their personal selling efforts, retailers provide important information about the arrival, special
features, etc., of new products to the customers. This serves as an important factor in the buying
decision making process of the purchase of such goods.
iii. Convenience in buying: Retailers generally buy goods in large quantities and sell
these in small quantities, according to the requirements of their customers. Also, they are
normally situated very near to the residential areas and remain open for long hours. This offers
great convenience to the customers in buying products of their requirements.
iv. Wide selection: Retailers generally keep stock of a variety of products of different
manufacturers. This enables the consumers to make their choice out of a wide selection of
goods