MBA ON LINE

Popular Links : |SMART| Marketing Theory | Marketing Mix | Ansoff Matrix |

Marketing Research

Research is the only tool an organisation has to keep in contact with its external operating environment. Inorder to be proactive and change with the environment simple questions need to be asked:

• How are customer needs changing? Can you meet these changing needs? What do your customers think about existing products or services?

• How are competitors operating within the environment? Are their strategies exceeding or influencing yours? What should you do?

• How are macro and micro environmental factors influencing your organisation? Again how will you react?

As witnessed with the UK retail clothing group C&A , failure to react to the changing needs of its customers within its environment has resulted in C&A closing all their UK retail stores. Marks and Spencers also faces an uncertain future. Research tells them that customers feel that the stores and clothes are outdated. M&S are now rushing out new lines and experimenting with new concept stores to retain existing and attract potential new customers. In the world of credit it is just recently that M&S are excepting credit cards!

Market Research and Marketing Research a difference.

A common mistake by many students, lecturers and textbooks is that there is no understanding of the clear distinction between market research and marketing research.

Market Research: Involves researching specific industry's or markets. Researching the computer industry to discover the number of competitors and their market share will be an example of market research.

Marketing Research: Marketing Research goes further. Marketing Research analyses a given marketing opportunity or problem, defines the research and data collection methods required to deal with the problem or take advantage of the opportunity, through to the implementation of the project. In essence marketing research aims to discover the root cause for a specific problem within an organisation ( eg declining sales) and put forward solutions to that problem.

Data Types

There are two types of data to be collected:

Marketing Environment - PEST Analysis

View a powerpoint slide PEST Analysis | Take a excercise here

Introduction

An organisation's success is influenced by factors operating in it's internal and external environment; an organisation can increase it's success by adopting strategies which manipulate these factors to it's advantage. A successful organisation will not only understand existing factors but also forecast change, so that it can take advantage of change within the environments in which it operates.

PEST & Micro environmental Factors

The following type of forces influence an organisation's operating environment:

• Pest Factors - These are external forces which the organisation does not have direct control over these factors. PEST is an acronym and each letter represents a type of factor (Political, Economical Social and Technological).
  Micro environmental factors - These are internal factors, which the organisation can control.

PEST & PESTLE analysis

A PEST analysis is used to identify the external forces affecting an organisation .This is a simple analysis of an organisation's Political, Economical, Social and Technological environment. A PEST analysis incorporating legal and environmental factors is called a PESTLE analysis.

Political

The first element of a PEST analysis is a study of political factors. Political factors influence organisations in many ways. Political factors can create advantages and opportunities for organisations. Conversely they can place obligations and duties on organisations. Political factors include the following types of instrument:

- Legislation such as the minimum wage or anti discrimination laws.
- Voluntary codes and practices
- Market regulations
- Trade agreements, tariffs or restrictions
- Tax levies and tax breaks
- Type of government regime eg communist, democratic, dictatorship

Non conformance with legislative obligations can lead to sanctions such as fines, adverse publicity and imprisonment. Ineffective voluntary codes and practices will often lead to governments introducing legislation to regulate the activities covered by the codes and practices.

 Economical

The second element of a PEST analysis involves a study of economic factors.
All businesses are affected by national and global economic factors. National and global interest rate and fiscal policy will be set around economic conditions. The climate of the economy dictates how consumers, suppliers and other organisational stakeholders such as suppliers and creditors behave within society.

An economy undergoing recession will have high unemployment, low spending power and low stakeholder confidence. Conversely a "booming" or growing economy will have low unemployment, high spending power and high stakeholder confidence.

A successful organisation will respond to economic conditions and stakeholder behaviour. Furthermore organisations will need to review the impact economic conditions are having on their competitors and respond accordingly.

In this global business world organisations are affected by economies throughout the world and not just the countries in which they are based or operate from. For example: a global credit crunch originating in the USA contributed towards the credit crunch in the UK in 2007/08.

Cheaper labour in developing countries affects the competitiveness of products from developed countries. An increase in interest rates in the USA will affect the share price of UK stocks or adverse weather conditions in India may affect the price of tea bought in an English café.

A truly global player has to be aware of economic conditions across all borders and needs to ensure that it employs strategies that protect and promote its business through economic conditions throughout the world.

Social

The third aspect of PEST focuses its attention on forces within society such as family, friends, colleagues, neighbours and the media. Social forces affect our attitudes, interest s and opinions. These forces shape who we are as people, the way we behave and ultimately what we purchase. For example within the UK peoples attitudes are changing towards their diet and health. As a result the UK is seeing an increase in the number of people joining fitness clubs and a massive growth for the demand of organic food. Products such as Wii Fit attempt to deal with society's concern, about children's lack of exercise.

Population changes also have a direct impact on organisations. Changes in the structure of a population will affect the supply and demand of goods and services within an economy. Falling birth rates will result in decreased demand and greater competition as the number of consumers fall. Conversely an increase in the global population and world food shortage predictions are currently leading to calls for greater investment in food production. Due to food shortages African countries such as Uganda are now reconsidering their rejection of genetically modified foods.

In summary organisations must be able to offer products and services that aim to complement and benefit people's lifestyle and behaviour. If organisations do not respond to changes in society they will lose market share and demand for their product or service.

Technological

Unsurprisingly the fourth element of PEST is technology, as you are probably aware technological advances have greatly changed the manner in which businesses operate.
Organisations use technology in many ways, they have

1. Technology infrastructure such as the internet and other information exchange systems including telephone
2. Technology systems incorporating a multitude of software which help them manage their business.
3. Technology hardware such as mobile phones, Blackberrys, laptops, desktops, Bluetooth devices, photocopiers and fax machines which transmit and record information.

Technology has created a society which expects instant results. This technological revolution has increased the rate at which information is exchanged between stakeholders. A faster exchange of information can benefit businesses as they are able to react quickly to changes within their operating environment.

However an ability to react quickly also creates extra pressure as businesses are expected to deliver on their promises within ever decreasing timescales..

For example the Internet is having a profound impact on the marketing mix strategy of organisations. Consumers can now shop 24 hours a day from their homes, work, Internet café's and via 3G phones and 3G cards. Some employees have instant access to e-mails through Blackberrys but this can be a double edged sword, as studies have shown that this access can cause work to encroach on their personal time outside work.

The pace of technological change is so fast that the average life of a computer chip is approximately 6 months. Technology is utilised by all age groups, children are exposed to technology from birth and a new generation of technology savvy pensioners known as "silver surfers" have emerged. Technology will continue to evolve and impact on consumer habits and expectations, organisations that ignore this fact face extinction.

PESTLE

A PEST analysis is sometimes expanded to incorporate legal and environmental factors; this is known as a pestle analysis. There are many statutes books containing company law as almost every aspect of an organisation's operation is controlled through legislation from treatment of employees through to health and safety. Legal factors are important as organisations have to work within legislative frameworks. Legislation can hinder business by placing onerous obligations on organisations. On the other hand legislation can create market conditions that benefit business.

Diagram: PEST analysis and the marketing mix.

Competitor Strategies

Any organisation that wishes to succeed and survive in their market, needs to analyse their competitors strategies. Competitor analysis is a vital part of the marketing planning process.

Competitor analysis enables an organisation to:

• Collect information on competitors that will directly influence the firms' strategy.
• Help the firm anticipate what the actions of their competitors will be, to their entry within the marketing.
• To exploit the competitor's weaknesses so the firm can gain an overall competitive advantage.

If you were to enter a market, some of the information you would need to know about your competitors islisted below.

• Who are your competitors?
• What is the size and dominance within the market.
• Which customer base are they aimed at?
• What is their positioning within the market?
• What are their objectives?
• What are their strengths and weaknesses?

Data from an array of sources can be collected on your competitors. Examples of data sources include:

• Competitors websites.
• Annual reports.
• Observation.
• News articles on TV or press.
• Talking to customers or sales staff.
• Covert operations including pretending to be a customer at your competitors store, or phoning their telephone sales line.

A complete understanding of competitors will help the organisation in preparing their overall marketing plan. As suggested, Porters Five Forces model is one model that helps the company identify competitors and potential competitor within their market and should be used in conjunction with a general competitor analysis.

A competitor can easily slow down your companies progress, competitor analysis should allow you to anticipate and react effectively to their move.

Next

New Product Development (NPD)

Improving and updating product lines is crucial for the success for any organisation. Failure for an organisation to change could result in a decline in sales and with competitors racing ahead. The process of NPD is crucial within an organisation. Products go through the stages of their lifecycle and will eventually have to be replaced There are eight stages of new product development. These stages will be discussed briefly below:

Stage 1: Idea generation

New product ideas have to come from somewhere. But where do organisations get their ideas for NPD? Some sources include:

• Within the company i.e. employees
• Competitors.
• Customers

Stage 2: Idea Screening

This process involves shifting through the ideas generated above and selecting ones which are feasible and workable to develop. Pursing non feasible ideas can clearly be costly for the company.

Stage 3: Concept Development and Testing

The organisation may have come across what they believe to be a feasible idea, however, the idea needs to be taken to the target audience. What do they think about the idea? Will it be practical and feasible? Will it offer the benefit that the organisation hopes it will? or have they overlooked certain issues? Note the idea and concept is taken to the target audience not a working prototype at this stage.

Stage 4: Marketing Strategy and Development

How will the product/service idea be launched within the market? A proposed marketing strategy will be written laying out the marketing mix strategy of the product, the segmentation, targeting and positioning strategy sales and profits that are expected.

Stage 5: Business Analysis

The company has a great idea, the marketing strategy seems feasible, but will the product be financially worth while in the long run? The business analysis stage looks more deeply into the cashflow the product could generate, what the cost will be, how much market shares the product may achieve and the expected life of the product.

Stage 6: Product Development

Finally it is at this stage that a prototype is finally produced. The prototype will clearly run through all the desired tests, and be presented to the target audience to see if changes need to be made.

Stage 7: Test Marketing

Test marketing means testing the product within a specific area. The product will be launched within a particular region so the marketing mix strategy can be monitored and if needed, be modified before national launch.

Stage 8: Commercialization

If the test marketing stage has been successful then the product will go for national launch. There are certain factors that need to be taken into consideration before a product is launched nationally. These are timing, how the product will be launched, where the product will be launched, will there be a national roll out or will it be region by region?

New Product Development

Why develop new products for your business?

Every business needs to innovate to stay ahead of the competition. No business can continue to offer the same unchanged product, if they did so, profit would not be maximized and sales would start to fall.

Here we will look at some of the reasons why a company may introduce new products into its portfolio.

• Consumer needs may change, forcing the company to adapt with these changing needs. If we look at food sectors around the world, consumers are becoming more health conscious, forcing companies to introduce low sugar and fat versions of their existing brands. Coca Cola Zero is a classic example.

• The product maybe at the end of its life cycle, so the company may introduce new and improved updated versions. Microsoft has done this by moving from the Xbox to the Xbox 360.

• The product might be at the maturity stage of its life cycle and might just need to be re-modified to stimulate an increase in sales. Sony PlayStation have done this with the original PlayStation by offering a smaller version called PSOne, and a slim version of the PlayStation 2.

• There maybe environmental changes which the company may want to capitalise on. Music companies are now selling more music via downloads then through traditional shops, originally being forced to change the way they deliver their product by Napster.

• Competitors may force change. New products maybe introduced because of competitors

Marketing Defined Marketing is a process aimed at satisfaction of customer needs. This is done by first assessing customer needs. Only then can the marketing process begin to consider the product as well as the price, promotion, and distribution elements that will optimally satisfy customer needs.

Core Marketing Concepts Needs describe basic human requirements such as food, air, water, clothing, shelter, recreation, education, and entertainment. Needs become wants when they are directed to specific objects that might satisfy the need. (hunger/Big Mac) Demands are wants for specific products backed by an ability to pay.

: What Can Be Marketed? Goods/Products Durables, nondurables Services 70/30 Events Olympic Games 150th Anniversary SJSU Persons Political Candidates Celebrities Places Consumers and business Organizations Institutional advertising Nonprofit organizations Information Consumer Reports CNET Ideas Floss, vote, safe sex, Overlap between categories

 Core Marketing Concepts A product is any offering that can satisfy a need or want, while a brand is a specific offering from a known source. When offerings deliver value and satisfaction to the buyer, they are successful. Formulae Value = Benefits/Cost Satisfaction = Value Received/ValueExpected

 Core Marketing Concepts Marketers can enhance the value of an offering to the customer by: Raising benefits (same price). Free accessory package Reducing costs (same product). Year-end sale Raising benefits while lowering costs Difficult; newer versions/econ of scale Lowering benefits by less than the reduction in costs Mercedes C-class

 Core Marketing Concepts Relationship marketing aims to build long-term mutually satisfying relations with key parties, which ultimately results in marketing network between the company and its supporting stakeholders. Cost/Benefit of existing versus new customers

 Core Marketing Concepts Target markets & segmentation Differences in needs, behavior, demographics or psychographics are used to identify segments. The segment served by the firm is called the target market. Positioning is occurs when you adjust your marketing mix to the needs of your target market.Core Core Marketing Concepts Figure 1-3: The Four P Components of the Marketing Mix

The New Economy Consumer benefits from the digital revolution include: Increased buying power. Currently in slowdown Greater variety of goods and services. Internet enhanced Increased information. Search engines! Enhanced shopping convenience. Internet enhanced. Greater opportunities to compare product information with others. Search engines.

The New Economy CNET is one of many sites that provides shopping comparison tools

The New Economy : The New Economy Firm benefits from the digital revolution include: New promotional medium. Access to richer research data. Enhanced employee and customer communication. Ability to customize promotions.

The New Economy : The New Economy Amazon is known for customizing consumer promotions

Core Marketing Concepts Target markets and market segmentation Needs, wants, demands Product offering and brand Value and satisfaction Exchange, transactions Relationships Marketing channels Supply chain Competition Marketing environment Marketing mix

Core Marketing Concepts : Core Marketing Concepts Marketing Channels Communication channels Distribution channels Service channels Deliver messages to and receive messages from target buyers. Includes traditional media, non-verbal communication, and store atmospherics.

 Core Marketing Concepts : Core Marketing Concepts Marketing Channels Communication channels Distribution channels Service channels Display or deliver the physical products or services to the buyer / user.

 Core Marketing Concepts : Core Marketing Concepts Marketing Channels Communication channels Distribution channels Service channels Carry out transactions with potential buyers by facilitating the transaction (banks, insurance, eBay, PayPal). Core Marketing Concepts : Core Marketing Concepts A supply chain stretches from raw materials to components to final products that are carried to final buyers. Each company captures only a certain percentage of the total value generated by the supply chain. Strategic view of channel

Core Marketing Concepts : Core Marketing Concepts Brand competition Industry competition Form competition Generic competition Four Levels of Competition

 Discussion Audi A4 Avant/Levels of Competition Sport Wagon (Matrix, Passat Wagon, Outback, ...) Automobile (sedan, coupe, SUV, minivan ...) Personal Transp. (auto, motorcycle, scooter, ...) Transportation (public, private, at-home) Other products (vacation, home, education,...)

Core Marketing Tools Forces Impacting the Broad Environment Socio-cultural Environment Technological Environment Legal-Political Environment Natural Environment Demographics Economics

The Marketing Concept Achieving organizational goals requires that company be more effective than competitors in creating, delivering, and communicating customer value. Three pillars of the marketing concept: Customer needs of target market(s) Integrated marketing Profitability

TECHNICAL TEACHERS' TRAINING INSTITUTE, BHOPAL

Workshop on

"Marketing of Educational Institutes, Programmes and Services"

CORE CONCEPTS OF MARKETING

DEFINITION OF MARKETING

Marketing is a social process by which individuals and groups obtain what

they need and want through creating and exchanging products and values with

others. (Philip Kotler)

Marketing is the analysis, planning, implementation, and control of carefully

formulated programs designed to bring about voluntary exchanges of values

with target markets for the purpose of achieving organizational objectives. It

relies heavily on designing the organization's offering in terms of the target

markets' needs and desires, and on using effective pricing, communication,

and distribution to inform, motivate, and service the markets. (Philip Kotler)

KEY POINTS

a) Managerial Process involving analysis, planning and control. (The view of marketing

as social process is not of interest to us as managers)

b) Carefully formulated programs and not just random actions. (A charity organization

sending volunteers out to collect money - this is not marketing, it is selling)

c) Voluntary exchange of values; no use of force or coercion. Offer benefits. (A

museum, seeking members, tries to design a set of benefits that are appealing to potential members.)

d) Selection of Target Markets rather than a quixotic attempt to win every market

and be all things to all men.

e) Purpose of marketing is to achieve Organizational Objectives. For commercial

sector it is profit. For non-commercial sector, the objective is different and

must be specified clearly. (City Health Department wishes to reduce diseases and enhance

health level. National Safety Council wants to bring down the death and accident rate in the nation)

Core Concepts of Marketing TTTI, Bhopal

Page No. 2

f) Marketing relies on designing the organization's offering in terms of the target

market's needs and desires rather than in terms of seller's personal tastes or

internal dynamics. User-oriented and not seller-oriented.

g) Marketing utilizes and blends a set of tools called the marketing mix - product

design, pricing, distribution and communication. Too often marketing is

equated either with just advertising or with just personal selling.

MARKETING vs. SELLING

There will always, one can assume, be need for some selling. But the aim of

marketing is to make selling superfluous. The aim of marketing is to know

and understand the customer so well that the product or service fits him and

sells itself. Ideally, marketing should result in a customer who is ready to buy.

All that should be needed then is to make the product or service available.

(Peter Drucker)

Examples: Sony's Walkman, Nintendo's superior video game

Marketing includes selling but should be preceded by needs assessment, marketing

research, product development, pricing and distribution.

Marketing based on hard selling carries high risk. Dissatisfied customers.

FOCUS MEANS ENDS

Selling Products Aggressive Selling and Sales

Promotion with emphasis on price

variations to close the sale. "I must

somehow hook the customer"

Maximize profits

through sales

volume

Marketing Customer

Needs

Integrated Marketing Plan

encompassing product, price,

promotion and distribution,

backed up by adequate

environmental scanning,

consumer research, and

opportunity analysis with

emphasis on service. "What can we

do that will make us, in the customer's

eyes, better than and superior to our

competitors."

Maximize profits

through increased

customer

satisfaction and

hence raise

market share.

Example: M. Institute is an institute specializing in preparing students for CAT. It opened a branch at Bhopal in

June 2002. To open the branch, it recruited the following persons: Branch Manager (BM), Marketing Executive

(ME), Student Counselor (SC), Operations Executive (OE) and an office boy. Faculty was not recruited initially.

Core Concepts of Marketing TTTI, Bhopal

Page No. 3

BM, ME and SC were responsible for selling. OE was responsible for administration of branch including

housekeeping and accounting. Due to the efforts of selling team and an aggressive advertising campaign, more

than twenty enrolments were done in various courses within the first two months. Faculty recruitment was done in

a hasty manner within a week of first enrolments. Students of first batch complained of poor course material,

inadequately prepared faculty, and absenteeism of faculty. In the months from November 2002 to January 2003,

there have been no fresh enrolments. By the end of January 2003, M. Institute had sacked its complete original

selling team and had advertised for fresh executives who could give commitments about meeting targets of

enrolments.

BENEFITS & CRITICISMS OF MARKETING

Benefits

a) Improved Satisfaction of Target Market

b) Improved efficiency in activities

Criticism

a) Marketing wastes money

b) Marketing activity is intrusive

c) Marketing is manipulative

NATURE OF ORGANIZATIONS

The Unresponsive Organization

a) It does nothing to measure the needs, perceptions, preferences or

satisfaction of its constituent publics.

b) It makes it difficult for its constituent publics to place inquiries, complaints,

suggestions or opinions.

Examples: Sovereign, monopoly or high demand positions insulated from popular control.

The Casually Responsive Organization

a) It shows an interest in learning about consumer needs, perceptions,

preferences, and satisfaction.

b) It encourages consumers to submit inquiries, complaints, suggestions and

opinions.

Examples: US universities in early seventies faced decline in student applications. College administrators till then

were largely oriented towards problems of hiring faculty, scheduling classes, and running efficient administrative

services - the earmarks of the bureaucratic mentality. They started listening to students. They left their doors

open, made occasional surprise appearances in the student lounge, encouraged suggestions from students, and

created faculty-student committees. These steps converted the university organization into being informally

responsive.

Core Concepts of Marketing TTTI, Bhopal

Page No. 4

The Highly Responsive Organization

a) It shows a keen interest in learning about the needs, perceptions,

preferences, and satisfaction of its constituent publics and relies on

systematic information-collection procedures such as formal opinion

surveys and consumer panels.

b) It encourages its constituents to submit inquiries, complaints, suggestions,

and opinions and creates formal systems to facilitate this, such as

suggestion boxes, comment cards, ombudsmen, and consumer

committees.

c) It sifts the incoming information and takes positive steps where called for

to adjust products, services, organizational policies, and procedures.

Examples: Large progressive firms like Hindustan Lever, Proctor and Gamble.

The Fully Responsive Organization

Moving a step from Highly to Fully eliminates the difference between "them" and

"us", giving power of decision making to constituents.

Examples: some churches, trade unions, associations and chambers of commerce.

A Canadian University was searching for ways to build a more active alumni association. Just sending out

newsletters about the school did not suffice to build up alumni pride or interest. It developed the idea of conferring

membership status to its alumni, with certain privileges and voting rights on certain issues. Suddenly this group

became alive with interest in the school. This gesture proved very meaningful to the alumni, which had hitherto

felt that the university was simply using them for money.

ORIENTATION OF ORGANIZATIONS

a) Production Orientation - Arose in scarcity economies. Business

concentrated on production output and efficiency. Finding customers easy;

products kept simple and often quality scaled down to increase profits.

b) Sales Orientation - Key assumptions are as follows:

1) The main task of the firm is to get sufficient sales for its products.

2) The consumer can be induced to buy through various sales stimulating

techniques and devices.

3) The customer will probably come back again and even if he does not,

there are many other customers out there.

Examples: Encyclopedia salesmen, insurance agents, many Indian companies

c) Marketing Orientation - The marketing concept is a consumers' needs

orientation backed by integrated marketing aimed at generating consumer

satisfaction as the key to satisfying organizational goals.

Core Concepts of Marketing TTTI, Bhopal

Page No. 5

NATURE OF NEEDS

A human need is a state of felt deprivation of some basic satisfaction. (food, clothing,

shelter, safety, belonging, esteem etc.)

Abraham Maslow noticed that some needs take precedence over others. For example, if

you are hungry and thirsty, you will tend to try to take care of the thirst first. After all, you can do without food for

weeks, but you can only do without water for a couple of days! Thirst is a "stronger" need than hunger. Likewise,

if you are very thirsty, but someone has put a choke hold on you and you can't breath, which is more important?

The need to breathe, of course. On the other hand, sex is less powerful than any of these. Let's face it, you won't

die if you don't get it!

Maslow took this idea and created his now famous hierarchy of needs. Beyond the

details of air, water, food, and sex, he laid out five broader layers:

1) Physiological needs. These include the needs we have for oxygen, water, protein, salt, sugar,

calcium, and other minerals and vitamins. They also include the need to maintain a pH balance (getting

too acidic or base will kill you) and temperature. Also, there's the needs to be active, to rest, to sleep, to

get rid of wastes (CO2, sweat, urine, and feces), to avoid pain, and to have sex.

2) Safety and security needs. When the physiological needs are largely taken care of, this

second layer of needs comes into play. You will become increasingly interested in finding safe

circumstances, stability, protection. You might develop a need for structure, for order, some limits.

Looking at it negatively, you become concerned, not with needs like hunger and thirst, but with your

fears and anxieties. In the ordinary adult, this set of needs manifest themselves in the form of our urges

to have a home in a safe neighborhood, a little job security and a good retirement plan and a bit of

insurance, and so on.

Core Concepts of Marketing TTTI, Bhopal

Page No. 6

3) Love and belonging needs. When physiological needs and safety needs are, by and large,

taken care of, a third layer starts to show up. You begin to feel the need for friends, a sweetheart,

children, affectionate relationships in general, even a sense of community. Looked at negatively, you

become increasing susceptible to loneliness and social anxieties.

In our day-to-day life, we exhibit these needs in our desires to marry, have a family, be a part of a

community, a member of a church, a brother in the fraternity, a part of a gang or a bowling club. It is also

a part of what we look for in a career.

4) Esteem needs. Next, we begin to look for a little self-esteem. Maslow noted two versions of

esteem needs, a lower one and a higher one. The lower one is the need for the respect of others, the

need for status, fame, glory, recognition, attention, reputation, appreciation, dignity, even dominance.

The higher form involves the need for self-respect, including such feelings as confidence, competence,

achievement, mastery, independence, and freedom. Note that this is the "higher" form because, unlike

the respect of others, once you have self-respect, it's a lot harder to lose!

The negative version of these needs is low self-esteem and inferiority complexes. Maslow felt that these

were at the roots of many, if not most, of psychological problems. In many countries, most people have

what they need in regard to their physiological and safety needs. Almost everyone, more often than not,

has quite a bit of love and belonging, too. It's a little respect that often seems so very hard to get!

All of the preceding four levels he calls deficit needs, or D-needs. If you don't have

enough of something -- i.e. you have a deficit -- you feel the need. But if you get all

you need, you feel nothing at all! In other words, they cease to be motivating. As the

old blues song goes, "you don't miss your water till your well runs dry!"

Maslow also talks about these levels in terms of homeostasis. Homeostasis is the

principle by which a furnace thermostat operates: When it gets too cold, it switches

the heat on; When it gets too hot, it switches the heat off. In the same way, our body,

when it lacks a certain substance, develops a hunger for it; When it gets enough of it,

then the hunger stops. Maslow simply extends the homeostatic principle to needs,

such as safety, belonging, and esteem, that we don't ordinarily think of in these

terms.

Under stressful conditions, or when survival is threatened, we can "regress" to a

lower need level.

Core Concepts of Marketing TTTI, Bhopal

Page No. 7

These things can occur on a society-wide basis as well: When society suddenly

flounders, people start clamoring for a strong leader to take over and make things

right. When the bombs start falling, they look for safety. When the food stops coming

into the stores, their needs become even more basic.

If one has significant problems along one's development -- a period of extreme

insecurity or hunger as a child, or the loss of a family member through death or

divorce, or significant neglect or abuse -- one may "fixate" on that set of needs for

the rest of one's life.

WANTS AND DEMANDS

Human wants are desires for specific satisfiers of these deeper needs.

Demands are wants for specific products that are backed by an ability and

willingness to buy them.

VALUE AND SATISFACTION

Value =

Monetary Costs Time Costs Energy Costs Psychic Costs

Functional Benefits Emotional Benefits

Costs

Benefits

+ + +

= +

Tools for tracking and measuring Customer Satisfaction: Complaint and

Suggestion systems, Customer satisfaction surveys, Ghost shopping, Lost customer

analysis

Anil Chawla

MF-104, Ajay Tower, E5/1 (Commercial),

Arera Colony, BHOPAL - 462016, INDIA

Tel. 91-755- 2736901, 2736902 (Res.)

Fax 91-755-2661382

Website http://www.samarthbharat.com

E-mail snacks@sancharnet.in

hindustanstudies@rediffmail.com

hindustanstudies@yahoo.co.in

Core Concepts of Marketing TTTI, Bhopal

Page No. 8

CLASS ASSIGNMENT

Discuss the following cases:

A. Newspaper

Newspapers have been facing declining sales all over the world due to onslaught of

television in the past two decades. However, some newspapers have suffered more

than others. A rare few (like Bhaskar group) have managed to grow in spite of

difficult times. The picture seems confusing. If you have to start a new newspaper in

your town, what will be the key factors that you will devote your attention to?

B. Restaurant

Tusharbhai has a space of 2000 square feet at ground floor on a prime location in

Vadodara. The place is walking distance from railway station and university. He is

advised by his friends to start a restaurant in the place. He approaches a consultant

for planning of the restaurant. Assume that you are the consultant. What are the

issues, information, data, etc that you would devote your mind to? In other words,

what questions would you like to ask and answer during the process of planning the

restaurant?

C. Casino

Tusharbhai is politically very well connected. He feels that he can get permission

from the relevant authorities for starting a casino at the above place. He asks the

consultant to evaluate the marketing feasibility of a casino. Discuss the issues

involved from a marketing perspective.

MarketingIntroduction : Supplier Categories :