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Retail / Marketing

Marketing

Traditionally, "marketing" has been a term applied to the craft of linking the producers (or potential producers) of a product or service with customers, both existing and potential. This general definition fails to provide any direction to someone hoping to market his products or services effectively. With that, a more modern explanation of what marketing is—and what makes it effective—is a definition coined by marketing researcher and author Brian Norris. Marketing is a four step process that begins with analyzing and defining a qualified universe of potential users or buyers. After this first phase in the marketing process, a true marketing effort succeeds in capturing the attention of the intended buyers within the targeted universe. Third, systematic effort must be put into getting the prospects to accept the concepts or propositions being offered via the marketing effort. Finally, with all three of the previous steps achieved, the marketer must convert prospective buyers into an actual buyers by getting them to take the desired action (purchase, rent, call, download, subscribe, refer, sell, follow the law, become a member, etc.). This four step process pertains primarily to the recruitment phase of marketing. Many of our economy's product and services are faced with the simple reality that most of their marketing needs to be focused on the retention of existing clients and customers. The process for retention now shifts the marketer to think about building a relationship, nuturing the links, enhancing the benefits that sold the client in the first place and improving the products/service continuously to protect her business from competitive encroachments.

Marketing methods are informed by many of the social sciences, particularly psychology, sociology, and economics. Marketing research underpins these activities. Through advertising, it is also related to many of the creative arts.

Contents

Types of markets

The word market originally meant the place where the exchange between seller and buyer took place. Today we speak of a market as either a region where goods are sold and bought or a particular type of buyer (summarized from Wells, Burnett, Moriarty, pg. 65–66). When strategizing specialists in marketing comment about markets they are usually referring to the different groups of people and/or organizations. The four major market groups are 1) consumer, 2) business to business, 3) institutional, and 4) reseller.

Consumer markets

The consumer market deals with the last/final customer who buys the product for their own satisfaction/personal use or household use. For example: If you were a college student consumer you could possibly be a member of the markets for "brand-name" clothing and shoes, college books, backpacks, newspapers and bicycles. You might also go to cafes, movie theatres and sports fixtures. The consumer market covers a wide variety of people of different ages, gender, race, and etc. as long as they are also the end user of the product. The majority of advertising funds are spent on consumer markets.

Product, price, promotion, and placement

In popular usage, the term "marketing" refers to the promotion of products, especially advertising and branding. However, in professional usage the term has a wider meaning that recognizes that marketing is customer centered. Products are often developed to meet the desires of groups of customers or even, in some cases, for specific customers. McCarthy divided marketing into four general sets of activities. His typology has become so universally recognized that his four activity sets, the Four Ps, have passed into the language. The 4 Ps are:

  • Product: The Product management aspect of marketing deals with the specifications of the actual good or service, and how it relates to the end-user's needs and wants.
  • Pricing: This refers to the process of setting a price for a product, including discounts.
  • Promotion: This includes advertising, sales promotion, publicity, and personal selling, and refers to the various methods of promoting the product, brand, or company.
  • Place or distribution refers to how the product gets to the customer; for example, point of sale placement or retailing.

These four elements are often referred to as the marketing mix. A marketer will use these variables to craft a marketing plan. The four Ps model is most useful when marketing low value consumer products. Industrial products, services, and high value consumer products require adjustments to this model. Services marketing must account for the unique nature of services. Industrial or b2b marketing must account for the long term contractual agreements that are typical in supply chain transactions. Relationship marketing attempts to do this by looking at marketing from a long term relationship perspective rather than individual transactions.

Technique

For a marketing plan to be successful, the mix of the four "p's" must reflect the wants and desires of the consumers in the target market. Trying to convince a market segment to buy something they don't want is extremely expensive and seldom successful. Marketers depend on marketing research to determine what consumers want and what they are willing to pay for. Marketers hope that this process will give them a sustainable competitive advantage. Marketing management is the practical application of this process.

Most companies today have a customer orientation (also called customer focus). This implies that the company focuses its activities and products on customer needs. Generally there are two ways of doing this: the customer-driven approach and the product innovation approach.

In the consumer-driven approach, consumer wants are the drivers of all strategic marketing decisions. No strategy is pursued until it passes the test of consumer research. Every aspect of a market offering, including the nature of the product itself, is driven by the needs of potential consumers. The starting point is always the consumer. The rationale for this approach is that there is no point spending R&D funds developing products that people will not buy. History attests to many products that were commercial failures inspite of being technological breakthroughs.

In a product innovation approach, the company pursues product innovation, then tries to develop a market for the product. Product innovation drives the process and marketing research is conducted primarily to ensure that a profitable market segment(s) exists for the innovation. The rationale is that customers may not know what options will be available to them in the future so we should not expect them to tell us what they will buy in the future. It is claimed that if Edison depended on marketing research he would have produced larger candles rather than inventing light bulbs. Many firms, such as research and development focused companies, successfully focus on product innovation. Many purists doubt whether this is really a form of marketing orientation at all, because of the ex post status of consumer research. Some even question whether it is marketing.

Diffusion of innovations research explores how and why people adopt new products, services and ideas.

A relatively new form of marketing uses the Internet and is called internet marketing or more generally e-marketing and online marketing. It typically tries to perfect the segmentation strategy used in traditional marketing. It targets its audience more precisely, and is sometimes called personalized marketing or one-to-one marketing.

Criticism of marketing

Some aspects of marketing, especially promotion, are the subject of criticism. See the main article Criticism of marketing.

Related lists

See List of marketing topics for a list of the 300 marketing articles on Wikipedia.

  • list of management topics
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  • list of business ethics, political economy, and philosophy of business topics
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