Contents Chapter 1 Introduction Meaning of Marketing... 1 Marketing Definitions... 1 Implications of the Various Definitions of Marketing... 4 Core Concepts of Marketing... 5 Marketing Management Concept... 8 Marketing Management Tasks... 9 Demand Management... 9 Customer Relationship Management (CRM)... 9 Marketing Management Cycle... 10 Marketing Management Philosophies... 12 The Production Concept... 12 The Product Concept... 13 The Selling Concept... 14 The Marketing Concept... 15 The Societal Marketing Concept... 17 The Holistic Marketing Concept... 18 Marketing Challenges in the New Millennium... 21 Firm s Responses to the Challenges... 23 Chapter Summary... 24 Review Questions... 25 Student Project... 25 Case: The Papermat S Starline Ballpen... 25 Case: Nepali Mineral Water Industry... 26 Chapter 2 Marketing Process and Environment The Marketing Process... 28 Targeting Customers... 28 Developing the Marketing Mix... 30 Product Mix... 31 Place or Distribution Mix... 32 Price Mix... 33 Promotion Mix... 34
Service Marketing Mix... 35 People... 35 Process... 35 Physical Evidences... 35 Implementation of the Marketing Mix... 35 Marketing Environment... 36 Scope of Marketing Environment... 37 Micro Environment of marketing... 39 Company s Internal Environment... 39 Customers... 40 Suppliers... 40 Marketing Intermediaries... 41 Competitors... 41 Publics... 42 Macro (External) Environment... 43 Demography... 43 Economy... 44 Socio-culture... 45 Technology... 46 Politics and Law... 47 Natural Environment... 48 Scanning the Marketing Environment... 49 Reactive and Proactive Marketing... 49 Chapter Summary... 52 Review Questions... 53 Student Projects... 54 Case: Use of Cfc in Fridges... 54 Chapter 3 Marketing Information System and Buyer Behaviour Marketing Information System... 55 Concept... 55 Relevance of Marketing Information System in Modern Marketing... 56 Components of Marketing Information System... 58 Internal Records System... 59 Marketing Intelligence System... 59 Decision Support System... 61 Marketing Research System... 61
Areas of Marketing Research... 62 Product Research... 62 Advertising Research... 63 Sales Research... 64 Motivation and Attitude Research... 64 Buyer Behaviour... 66 Consumer Behaviour... 67 Consumer Buying Process... 67 High-involvement and Low-involvement Buying Decisions... 67 Stages of Consumer Buying Decision Process... 70 Step 1: Need or Problem Recognition... 70 Step 2: Search for Information... 71 Step 3: Evaluation... 72 Step 4: Purchase... 73 Step 5: Post-purchase Evaluations... 74 Determinants of Consumer Buying Decisions... 76 Economic Factors... 76 Personal Factors... 77 Psychological Factors... 77 Socio-cultural Determinants... 88 Group Influence on Consumer Behaviour... 88 Family Influence... 89 Social Class Influence... 91 Cultural Influences... 93 Culture and Marketing... 93 Organizational Buying Behaviour... 94 Organizational Buying Process... 95 Determinants of Organizational Buying... 96 Environmental Factors... 97 Organizational Factors... 97 Interpersonal Factors... 98 Individual Factors... 98 Cross-cultural Factors... 99 Chapter Summary... 99 Review Questions... 101 Student Projects... 102 Case 1: Ram Bahadur s Choice... 103 Case 2: Women Shoppers Over the Years... 103
Chapter 4 Market Segmentation and Targeting Market Segmentation... 105 Concept... 105 Market Segmentation Process... 106 Market Segmentation: a Customer Oriented Philosophy... 107 Segmentation Requirements... 108 Levels of Market Segmentation... 109 Bases for Segmenting Consumer Markets... 110 Bases for Segmentating Business Markets... 114 Market Targeting... 116 Segment Evaluation... 116 Segment Analysis... 117 Segment Selection... 118 Other Considerations in Targeting Strategy... 119 Positioning... 121 Concept... 121 Types of Positioning... 121 Implementation of the Positioning Strategy... 122 Chapter Summary... 124 Review Questions... 125 Student Project... 125 Case: Nepal s Market for Consumer Electronics... 126 Chapter 5 Product Concept... 127 Concepts of Product... 129 Levels of Product... 129 Product Classifications... 131 Consumer Products... 131 Product Nature Classification... 131 Buying Motive Classification... 132 Buying Involvement Classification... 132 Buying Behaviour Classification... 132 Industrial Products... 136 Materials and Parts... 136 Capital Goods... 138
Supplies and Business Services... 139 Product Life Cycle... 140 Concept... 140 Stages in the Product Life Cycle... 141 Marketing Activities in the PLC Stages... 143 Introduction Stage Marketing Activities and Strategies... 143 Growth Stage Marketing Activities and Strategies... 144 Maturity Stage Marketing Activities and Strategies... 145 Decline Stage Activities and Strategies... 146 Limitations of the Product Life Cycle Concept... 147 New Product Development... 147 Concept of a New Product... 147 Innovations... 147 Modifications... 148 Copies or me-too Products... 148 Need for Product Innovation... 148 Reasons for Product Failures... 149 New Product Development Process... 150 Idea Generation... 150 Idea Screening... 152 Concept Development and Testing... 152 Marketing Strategy Development... 152 Business Analysis... 153 Product Development and Testing... 153 Test Marketing... 154 Commercialization... 154 Individual Product Decisions... 155 Product Attributes Decision... 155 Branding Strategies... 158 Packaging... 165 Labeling... 168 Product Support Services... 169 Product Line and Mix Decisions... 169 Product Line Strategies... 170 Product Line Length Strategies... 170 Product Line Modernization... 172 Product Line Featuring... 172 Product Mix Strategies... 173
Service Marketing... 173 Concept... 173 Nature of Services Marketing... 174 Service includes Product and Product includes Service... 175 Types of Service... 175 Nature of Service Products... 176 Service Marketing Strategies: The Triangular Marketing... 179 Management of Service Marketing Mix... 180 Service Differentiation... 183 Service Quality... 184 Service Productivity... 185 Chapter Summary... 187 Review Questions... 189 Student Project... 190 Case 1... 190 Case 2: Doing Business in China... 191 Case 3: Strawberry Wine... 191 Case 4: Case: Brand Building... 192 Chapter 6 Pricing Concept of Price and Pricing... 194 Importance of Pricing... 195 Importance from Macro (National) Perspective... 195 Importance from Micro (Firm's) Perspective... 196 Internal and External Factors Affecting Price... 196 Internal Price Factors... 197 External Price Factors... 198 Pricing Approaches... 199 Cost-Based Pricing Methods... 199 Demand Oriented Pricing Method... 202 Value-Based Pricing Methods... 204 Competition-Based Pricing Methods... 205 New Product Pricing... 205 Product Mix Pricing... 207 Price Adjustment Strategies... 207 Discount Policy... 207 Allowance Policy... 207
Price Changes: Initiating and responding to price changes... 208 Initiating Price Changes... 208 Responding to Price Changes... 209 Chapter Summary... 210 Review Questions... 211 Student Project... 212 Case: South-West Airlines... 212 Chapter 7 Distribution Concept of Distribution... 213 Channel Functions... 215 Channel Design Decisions... 216 Channel Designs for Consumer Products... 216 Channel Designs for Industrial Products... 218 Channel Selection Factors... 220 Customers... 220 Distribution Objective... 221 Channel Constraints... 222 Channel Management Decisions... 223 Management of Channel Dynamics... 223 Marketing Logistics... 227 Concept and Nature... 227 Objectives of Marketing Logistics... 227 Major Logistics Functions... 227 Integrated Logistics Management... 232 Chapter Summary... 233 Review Questions... 235 Student Project... 235 Case: Dell Computers... 235 Chapter 8 Promotion Concept... 237 Marketing Communication Process and System... 238 The Marketing Communication System... 238 Promotion Mix Strategy... 240 The Promotion Mix... 240 Determination of the Promotion Mix... 241
A n a l y s Advertising... 243 Meaning and Nature of Advertising... 243 Advertising Objectives... 245 Advertising Budgets... 245 Items of Expenses... 246 Budgeting Approaches... 246 Methods of Establishing Budget... 247 Advertising Message Selection... 252 Factors Affecting Message Design... 252 The Message Strategy... 253 Advertising Media Selection... 255 Media Selection Decision... 257 Personal Selling... 258 Meaning... 258 Nature of Personal Selling... 258 Importance of Personal Selling... 259 Types of Personal Selling... 259 Merits of Personal Selling... 260 Relationship Marketing... 261 Dimensions of Relationship Marketing... 261 Levels of Relationships... 262 Practice of Relationship Marketing... 262 Relationship Building Process... 263 Sales Promotion... 264 Concept... 264 Objectives of Sales Promotion... 265 Sales Promotion Tools and Techniques... 266 Public Relations... 268 Concept... 268 Objectives of Public Relations... 269 Tools of Public Relations... 269 Chapter Summary... 272 Review Questions... 273 Student Project... 274 Case: Amul Butter... 274 Marketing Glossary... 275