CHAPTER-1

MARKETING-MEANING, DEFINITION
& IMPORTANCE

INTRODUCTION
 The term Marketing is derived from the Latin word “Marcatus” which means “to trade”.
 Market means a convenient meeting place where sellers and buyers gather together for exchange of
goods.
 Definition of the term “Market”:-
According to Pyle “Market includes both the place and region in which buyers and sellers are in
free competition with one another.”

IMPORTANCE OF MARKET
 Enables the sellers to sell.
 Enables the buyers to buy what they want
 Generates lots of employment opportunities
 Essential for the economic development of any country
 Generate income and there by promote Trade & Commerce

CLASSIFICATION OF MARKETS
Markets can be classified in many ways. Generally the classification is made on,
1. On the basis of Geographical Area
a) Local Market
When the market for a product is restricted to a particular town or state, such market is
called Local Market.
Eg:- Fish, Fruits & vegetable Markets.
b) National Market
When the market for a product extends to the whole country, such market is called National
Market.
Eg; The total demand for greetings cards
c) International Market
A product, which is marketed throughout the world, is said to be having an international
Market.
Eg: Coca-cola, Pepsi
2. On the basis of Economics
a) Perfect Market
The homogeneous nature of goods and the uniform price throughout the market are the key
characteristics of a perfect market
Eg;-Agricultural market, street food
b) Monopolistic Market
The market for those products which are not identical and whose prices are different is
known as Monopolistic Market.
Eg;-Clothing, Restaurants
c) Monopoly Market
It is a market having just one seller.
Eg: Railways, Microsoft & windows
d) Oligopoly Market
It is a market in which there are few sellers who work according to a common
understanding.
Eg: Soft drinks, media industry
3. On the basis of Volume of Business
a) Whole sale Market
A wholesaler is a person who sells in large quantities to retailers.
b) Retail Market
In retail markets goods are sold in small quantities directly to the consumers.

4. On the basis of Time

a) Very Short Period Market
It is a Market that exists for just a day at a particular place.
Eg: Fruits, Fish and Vegetables
b) Short Period Market
When the market exists for a week or a month, it can be called a Short Period Market.
Eg;-price promotion, Discounts
c) Long Period Market
The market for most consumer goods and services is Long Period Market.
Eg;-
5. On the basis of Importance
a) Primary Market
It is the market for agricultural commodities.
b) Secondary Market
It is the market for semi-manufactured goods.
c) Terminal Market
It is the market in which the final products are sold to the ultimate consumer.

6. On the basis of Nature of Goods

a) Commodity goods
 Agricultural Goods Market
It is a market for agricultural goods.
 Consumer Goods Market
It is a market in which goods desired by the common man are made available
 Industrial Goods Market
It is a market in which goods used by manufacturer as inputs in production are sold.
 Bullion Market
It is the Market for gold and silver.

b) Capital Market
 Money Market
It the market in which money is borrowed and lent.
 Foreign Exchange Market
In this Market the currencies of foreign countries are bought and sold.
 Stock Market
The shares of companies and other securities are traded in a stock market.

7. On the basis of Regulation

a) Regulated Market
These markets are governed by rules and regulations.
b) Unregulated Market
These markets operate according to demand and supply forces and are not governed by rigid rules
and regulations.

8. On the basis of Nature of Transactions

a) Spot Market
In this kind of market delivery of goods take place immediately.
b) Forward Market
In such a markets which are made but physical delivery of goods take place only on a future
date.

MARKETING

MEANING
Marketing is the process of transferring the goods from the point of production to the point of
consumption.

DEFINITION
In the words of Philip Katler “Marketing is specifically concerned with how transactions are created,
stimulated, facilitated and valued.

Features of Modern Marketing

 Modern marketing is consumer oriented
 It starts and ends with the consumer.
 It starts before production.
 It guides the business.

Objectives of Marketing
 Development of Marketing field
 Increasing consumption and wellbeing of society.
 Cost reduction.
 Creation of Goodwill.
 Ensuring growth.
 Improving quality of life.
Importance of Marketing
 It enables marketers to know the taste and preferences of the consumers.
 It fulfils the needs of the buyers by giving them what they want.
 It helps the marketer in the matter of selection of the right promotional tools.
 It guides the manufacturers in selecting the correct channel of distribution.
 Marketing provides employment opportunities.
 Innovations in marketing have given the buyers superior goods at affordable price.

Marketing Concept
Marketing concept is the basic philosophy of business. The different concepts of marketing are following

1. Social Marketing concept

This is a relatively new marketing concept. It emphasizes the importance of the wellbeing of
customers and society as a whole.
2. Product Concept
This concept work on assumption that customers prefer products of greater quality, price and
availability.
3. Production Concept
The production concept highlights that a business can lower costs via mass production.
4. Selling Concept
The selling concept highlight that customers would buy a company’s products only if the company
were to sell these products aggressively.
5. Marketing concept
A company that believes in the marketing concept places the consumer at the centre of the
organization.
Selling and Marketing
S/N Marketing Selling
Customer satisfaction is the philosophy of
1 Profit maximisation is the philosophy of selling
marketing
2 The focus of marketing is long run The focus of selling is short run
3 Marketing starts before production Selling starts after production
4 Selling is a part of marketing Marketing is not a part of selling
5 It is a changing concept It is static
6 Marketing is concerned with buyers needs Selling is concerned with sellers needs.

Marketing Mix
 Marketing mix was proposed in 1960 by E Jerome McCarthy.
 Marketing mix is a combination of marketing tools that a company used to satisfy their target customers
and achieving organizational goals.

Definition
According to Philip Kotler “Marketing Mix is the set of controllable variables that the firm can use to
influence the buyer’s response”

Marketing Mix consists of mainly four elements, referred to as 4 P’s

 Product Mix
Product mix covers all ingredients that constitute the right product.

 Price Mix
Price Mix is the combination of the decision variables like pricing objective, pricing policies,
discount and allowances etc.
 Place Mix
Physical distribution is the delivery of products of the right time and at the right place.

 Promotion Mix
Promotion is basically a communication process. Promotion mix is the combination of decision
variables like advertising, publicity, personal selling etc.

Importance of Marketing Mix

 Promotes better utilization of limited resources
 An important toot of marketing programme.
 Helps in goal achievement.
 Facilitates communication.
 Provides customer satisfaction.
 An effective tool for problem solving.

Factors affecting Marketing Mix

Internal Factors External Factors

Can be controlled by Beyond the control of

Marketing Management Marketing Management

 Product planning  Consumer buying behaviour

 Price  Trader’s behaviour
 Branding  Competitor’s behaviour
 Personal Selling  Governmental behaviour
 Sales Promotion

Innovation in Modern Marketing

1) Social Marketing
The appreciation of marketing theories and techniques to social situation is called social marketing.
Eg: Green Marketing.

2) De Marketing
It refers to the practices of discouraging the consumers from buying. The various causes for de marketing
are,
 Temporary shortage of stock.
 Inadequate production policy.
 Due to the policy of Government.
Eg;- Nano cars
3) Remarketing
Remarketing is concerned with finding or creating new users or users for an existing product.
Eg: Plastic
Flattering Demand:
It refers to a situation in which the demand for product or service is less than it was before.

4) Over Marketing
It is a situation in which firm trying to increase selling and production by ignoring the quality and
production efficiency.

5) Meta Marketing
This concept of marketing focuses all scientific, social, ethical and managerial experience on marketing.
Eg:-House cleaning products includes homeowners and domestic cleaning service companies.

6) Counter Marketing
The certain products have demand in the market but these products are harmful to the society.
Eg: Drugs, cigarettes, alcohol.

7) Maintenance Marketing
Under this marketing, the efficiency in carrying out day to day mankind activities must be maintained.
Eg:-Social Media Advertisements.
TV and Radio Advertising.
Celebrity Endorsements.
Direct Mails.

8) Synchro Marketing
Synchro Marketing is trying to buying about equilibrium between demand and supply by adopting high
price in peak period and low price during off season.
Eg;-Umbrella, Raincoats

9) Developmental Marketing
It is a process of effectively convert latent demand into actual demand. Latent demand means strong
need for something that does not exist in the form of actual product or services.

10) Stimulational Marketing

It is concerned with converting “no demand into positive demand”
Eg: Providing special offers.

11) Mass Marketing

Under this system the marketer does mass production, mass distribution and mass promotion of only
one product for all buyers.
Eg: Pepsi

12) Maxi Marketing

Maxi Marketing is set of marketing strategies developed by Stan Rapp and Thomas L. Collins in their
1987 book ‘Maxi Marketing’. Maxi marketing consist of maximum target, maximum media, maximum
awareness, maximum sales and maximum distribution.

13) Micro Marketing

Micro Marketing is concerned with the marketing of the product of an individual firm.
Eg;- Natural shampoo and conditioner product line.
14) Macro Marketing
It is the study of the economic exchange process of a total economy.

15) Mega Marketing

It is the technique of entering into blocked countries and marketing the product by using economic,
political and public relation.

16) Data base Marketing

Data base Marketing is a form of different marketing using database of customers or potential customers
to generate personalizes communication in order to promote a product or service for marketing purpose.

17) Network Marketing

Network Marketing is a business model that depends on person to person sales by independent
representatives, often working from home.

18) International Marketing

International marketing is the performance of business activities that direct the flow of goods and
services to customers or users in more than one country.

19) Internet Marketing

It is a marketing that is carried out exclusively on the internet.

20) Relationship Marketing

It is form of marketing developed from direct response marketing campaigns that emphasizes
customer’s retention.
Eg;- Birthday cards ,providing special offers

21) Rural Marketing

It is a process of developing, pricing, promoting and distributing rural specific goods and services
leading to desired exchange with rural customers to satisfy their needs and wants.

22) Marketing Myopia

The concept of Marketing Myopia has been developed by a marketing expert “Theodore Levitt”. It
means a short sighted inward looking approach to marketing that focuses on the needs of the company
and its products in term of the consumers needs and wants. It results in the failure to see and adjust the
rapid changes in their market.