What is Marketing Management

“Marketing management is the process of ascertaining consumer needs, converting them into products or services and moving the product or services to the final consumers or users to satisfy needs and wants with emphasis on profitability ensuring the optimum use of the resources available to the organisation.” – According to Davar’s

Marketing management is one of the important operative functions of business. It is that functional area of business management which is concerned with the marketing of products and services. It involves planning, organising, directing and controlling the activities relating to the marketing of goods and services to satisfy the needs of customers.

It can, thus, be descri­bed as a specialised function having a scope to regulate the level, timing and character of demand far the goods and services in order to accomplish the stated objectives of a business firm. Its scope extends to the marketing process and involves the planning, organising, staffing, motivating, co­ordinating and controlling the marketing factors to achieve the organisa­tional goals.

Marketing Management Definition

Some important definitions of marketing management are given below:

According to Philip Kotler:

“Marketing management is the analysis, planning, implementation and control of programmes designed to bring about desired exchanges with target audiences for the purpose of mutual or personal gain. It relies heavily on the adaptation and coordination of project, price, promotion and place of achieving effective response.”

According to Stanton:

“Marketing management is the marketing concept in action.”

According to Cundiff and Still:

“Marketing management is a branch of the broad area of management. It is concerned with the direction of purposeful activities towards the attainments of marketing goals.”

According to Davar’s:

“Marketing management is the process of ascertaining consumer needs, converting them into products or services and moving the product or services to the final consumers or users to satisfy needs and wants with emphasis on profitability ensuring the optimum use of the resources available to the organisation.”

Features of Marketing Management

The important features of marketing management may be outlined as under:-

1. Marketing is a specialised business function. In the early days, the selling function did not call for any specialised skills as the sales could have been affected on production-basis. But now the business environ­ment has undergone tremendous changes in social, economic, political and cultural aspects. The management of a firm, therefore, has to develop a particular organisation with a view to absorbing new ideas, new approaches and new market demands.
2. Marketing is a social function. It requires constant interaction with the various strata of society. It is instrumental in manipulating the factors of production, distribution, promotion and price, and also in influencing the patterns of consumption and consumer attitudes.
3. Marketing is an integrative function. It integrates and combines the other business functions like production, finance, personnel, R&D, etc. with a view to accomplishing the organisational objectives.
4. Marketing reflects the business mission of a firm before the public and society.
5. It is said that change is the only basic law of economics. Marke­ting, which is the art of distributing the products and services among the various claimants, has also only one basic law, change.
6. Marketing is a universal function. It has a universality in the sense that it can be applied to both profit-motive and non-profit motive organisations. A profit-seeking business unit is dependent on marketing. The institutions like hospitals, schools, universities, or political associations also practice marketing in popularising the services offered by them.
7. Marketing is a management function like the management of other functions such as production, finance, personnel, etc. The business poli­cies, strategies and programmes related to marketing are mostly manage­rial functions. These are needed to be planned, organised, directed, coordi­nated, and controlled so as to achieve the marketing objectives.

Objectives of Marketing Management

The objectives of marketing management are as follows:

Objective – 1. Creation of Demand:

The first objective of marketing management is to create demand through various means. A conscious attempt is made to find out the preferences and tastes of the consumers. Goods and services are produced to satisfy the needs of the customers. Demand is also created by informing the customers of the utility of various goods and services.

Objective – 2. Customer Satisfaction:

The marketing manager must study the demands of customers before offering them any goods or services. Selling the goods or services is not that important as the satisfaction of the customers’ needs is. Modern marketing is customer-oriented. It begins and ends with the customer.

Marketing tries to realise long-term goals of profitability, growth and stability through satisfying customers’ wants. All the basic activities of a business organisation like production, finance, marketing, etc. are coordinated to meet the wants of customers and to earn a reasonable profit.

Objective – 3. Generation of Profits:

The marketing function generates revenue for the business. Sufficient Profits must be earned as a result of sale of want-satisfying products. If the firm is not earning profits, it will not be able to survive in the market. Moreover, profits are also needed for the growth and diversification of the firm.

Objective – 4. National Development:

Marketing stimulates economic growth and raises the level of employment in the economy. Large-scale production with all its economies is ensured through continuous marketing of products. Marketing helps integrate various sectors of the economy. It also contributes to fuller utilisation of existing resources. Moreover, marketing also promotes development of entrepreneur and managerial class in the society.

Objective – 5. Higher Standard of Living:

Marketing aims at achieving, maintaining and raising the standard of living of the community. It helps expand production and adds to the variety of goods and services available for consumption by people.

Objective – 6. Creation of Goodwill:

Goodwill, as we know, is nothing but profits enjoyed by a firm or organisation due to its reputation. By selling goods at reasonable rates and thus satisfying the consumers, the marketing functions help in building goodwill. This in return increases sales and profits due to reliability and thus, the circle goes on.

Nature of Marketing Management

Marketing management is one of the important operative functions of business. It is that functional area of business management which is concerned with the marketing of products and services. It involves planning, organising, directing and controlling the activities relating to the marketing of goods and services to satisfy the needs of customers.

It is the marketing concept in action. It includes all activities which are necessary to determine and satisfy the needs of consumers. Thus marketing research and product planning are integral parts of marketing management.

Marketing management is goal directed. It attempts to satisfy the needs of customers by offering them want-satisfying products and generate profits for the business. It determines the appropriate marketing mix of the firm. Product design, its promotion, its pricing and its distribution are synchronised so as to maximise the sales volume.

The chart below depicts the nature of marketing function at a glance:

Scope of Marketing Management

Marketing management is that part of the business management which is concerned with marketing, i.e. leading and co-coordinating the various activities of the business firm in getting its goods and services to its customers. It can, thus, be descri­bed as a specialised function having a scope to regulate the level, timing and character of demand far the goods and services in order to accomplish the stated objectives of a business firm. Its scope extends to the marketing process and involves the planning, organising, staffing, motivating, co­ordinating and controlling the marketing factors to achieve the organisational goals.

Accordingly, the scope of marketing management covers a cluster of activities like –

(a) Planning of marketing strategy and policy;

(b) organising sales, selling and distribution method and procedures;

(c) organising and monitoring the stocks at optimum levels such that the customer demand is met without any difficulty and without allowing the investment in stock to cross predetermined limits; and

(d) organising and maintaining the effectiveness in the activities of sales promotion, advertisement, credit control and services after sales.

The scope of marketing management, when viewed from the functional aspects, can be charted as below:-

Importance of Marketing Management

The present day business world has undergone rapid change and transformation, rather a metamorphosis, in the last few decades. Rapid growth of population, changes in tastes and preferences of buyers, emergence of income-based different classes of buyers/consumers, commercialisation of technological innovations, direct foreign investment in various parts of the world and the emergence of nati­onal strategy and pressure groups like trade associations, chambers of commerce, international and national business leaders, rising expectations of the public have all made the business environment complex.

A business firm, basically a micro-unit, is not isolated from the world around it. In other words, a thorough understanding of the economic, social, cultural, and political environments in which a business firm operates has become a major priority for management.

The marketing management of a business entity has to understand these environmental aspects. The future develop­ment of business firms in the background of these environmental factors largely depends on the importance and seriousness attached to the marketing functions.

In a modern enterprise, the objective of the marketing department is not so much to find customers for goods and services produced by the firm as it is to find ways in which the resources of the firm can be used to meet the needs of the potential consumers and maximise profit.

Thus the marketing management may recommend that the existing products of the firm be removed from production because they are no longer profitable and that new products be added. Therefore, the marketing department or manage­ment plays a key role in determining the strategy of the firm in its quest to maximise profit.

On the marketing side, economic variables along with personal tastes underlie the demand or sales forecast for a commodity. These are also the factors that determine price elasticity, income elasticity and cross elasticity of demand. In preparing a marketing strategy, it is the marketing management of a firm that must consider the structure of the market.

The chart below shows how the marketing management and operational management can come together to devise the market strategy for the firm that meets the objectives of both the consumers and business firms. Three sets of variables are shown — market structure, economic variables and technological variables. These are external to and beyond the control of the firm, but which the marketing management of a firm may seek to influence to its advantage through research and promotional activities.

In view of what has been discussed above, we can state that the marke­ting activities are necessary and useful adjuncts to the survival and growth of a business enterprise. An effective and well planned marketing function is the life-blood of the organisation.

To sum up, the marketing function is considered important on account of its following contributions:

1. All economic activities like production, distribution, and consum­ption are dependent on marketing. An efficient marketing system can keep the factors of production fully and profitably employed which is basic to the functioning of the economy.
2. An efficient marketing set-up increases the volume of sales and thus reduces the cost of distribution of products and services.
3. A marketing function maintains a regular interaction with the existing and potential users and consumers to ascertain their needs. This way, it leads to production of socially useful goods and services.
4. It is the marketing process that makes available to the customers the products and services of their choice at reasonable prices.
5. Through effective advertising and salesmanship, the marketing function serves to educate the people for better and newer uses of goods and for use of new products, and thereby delivers a standard of living to the customers.
6. It is the marketing function that creates an infra-structure of transportation, insurance, warehousing activities due to which employment opportunities increase.

Role of Marketing Manager in Implementing Marketing Mix

The following are considered to be the basic functions of a marketing manager:

Role – 1. Integrated Marketing:

The marketing manager has to make decisions on the various elements of the marketing mix in an integrated way. A customer does not purchase a product just because of its price or utility or appearance. While purchasing, a customer is influenced by all aspects such as the promotional and advertising strategy of the company, its channels of distribution, the actual product, after sale services etc.

Thus the marketing manager has to integrate all the elements of the marketing mix in such a way that the consumer finds the final deal very attractive. While doing this the marketing manager must never lose sight of the company’s interests. He should try to reduce the cost of marketing the products and at the same time win the goodwill of the customers. He has to coordinate the activities of the various departments of marketing as well as co-ordinate between the marketing department and all other departments like production department, finance department etc.

Role – 2. Determining Objectives:

It is the function of the marketing manager to determine the marketing objective of the company. The marketing objective must be fixed keeping in mind the overall objective of the firm. Not only does he have to fix the marketing objective, but he has to crystallise the product objective pricing objectives, promotion objectives and physical distribution objectives. He has to integrate and direct all these objectives towards the overall marketing objective.

Role – 3. Product Policy:

The marketing manager must be very clear as to the type of customer who will use his product. He should be clear on whether his company wants to produce a single product or a line of products. Thus his product policy objective must be consumer oriented and in keeping with the overall marketing objective.

Role – 4. Pricing Policy:

It is the duty of the marketing manager to fix the pricing policy in keeping with the marketing and overall company policy. The pricing policy and product policy are interrelated. The marketing executive should fix the price in such a way that it results in maximum profit for the company from the volume of sales secured at that particular price.

Role – 5. Distribution Strategy:

The Marketing Manager has to decide upon the distribution strategy that he wants to adopt. Does he want a limited distribution or a widespread distribution, will have to be decided and then he will have to organise for the channels of distribution and will have to select the channel accordingly.

Role – 6. Advertising and Sales Promotion:

The Marketing Executive has to decide upon the advertising and sales promotion policy. He will have to decide whether the advertising will be done by a separate department in his organisation or it would be better to entrust the work of advertising to the outside professionals, or to use a combination of both these methods.

Role – 7. Proper Planning:

Planning is the steps to decide in advance what is to be done. All companies carry out planning. The marketing manager has to plan as to how the objectives that have been determined will be implemented.

For proper planning the marketing manager has to carry out the following functions:

(a) Marketing research,

(b) Planning the sales policies,

(c) Planning the long-term marketing programme,

(d) Planning for product diversification.

Role – 8. Selling:

The marketing manager has to perform the following functions in regard to selling:

(a) To direct the sales manager to regulate sales,

(b) To organise sales territories and fix sales quotas,

(c) To select and train personnel for the sales department,

(d) To motivate the sales personnel,

(e) To organise and develop the channels of distribution.

Role – 9. Service:

After sales service is regarded as an integral part of modern marketing management. In fact in today’s competitive business world if a company has to survive, it has to be consumer oriented and has to take care to see maximum satisfaction is given to the customers. Thus a Marketing Manager must see to it that proper after sales services are given to the customers. Any complaints and problems of the customers are to be dealt with at once.

The Social Responsibilities of a Marketing Manager

Marketing manager main responsibilities to the society are:

Responsibility – 1. Consumer Satisfaction:

Consumer satisfaction is the fundamental principle of the modern marketing concept. The marketing manager studies the consumer’s behaviours, their preferences, tastes, and fashions in relation to the products. He endeavours to modify the products according to the needs of the actual users.

Responsibility – 2. Reducing Product Costs:

Reducing product cost is another obligation of the marketing manager towards the society. By making the various marketing activities efficient, economical and effective, he can reduce the costs of the products per unit. It will help the consumers to get goods at reasonable prices.

If the company does not transfer the benefits of the reduced cost to the customers, and retains the whole of the profits itself, the society is still benefited. In that case, the retained earnings are invested in the development of new products or they will be distributed to the shareholders as dividend. In both the cases, society will gain.

Responsibility – 3. Providing Information:

One of the obligations of the marketing manager is to provide information about the qualities of the products of the company in a way the consumers may make up their minds to purchase the company’s products. It helps make the image of the company and its products.

Responsibility – 4. Marketing Social Needs:

He studies the actual wants of the people and organises production accordingly. Goods are produced on a large scale at one place. He undertakes the important task of distribution of goods and looks to the total satisfaction of the consumers.

Responsibility – 5. Providing Employment:

A large number of persons are engaged in the marketing activities such as wholesalers, retailers, advertisers, insurance agents, transporters, bankers, clerks, salesmen, etc. Thus marketing activities provide employment to a large number of people. Thus, it is evident that the marketing manager is responsible to the society in many respects which he should execute sincerely.

Marketing Management has to Fulfil the Following Responsibilities

Marketing management has to fulfil the following responsibilities in particular:

1. Sales and market analysis.
2. Determination of marketing goals.
3. Sales forecasting and marketing budget.
4. Formulation of marketing plans, and procedures.
5. Evolving an appropriate marketing-mix.
6. Organising of all marketing activities included in the marketing-mix. Marketing activities may be organised product-wise, area-wise or customer-wise according to specific requirements. We can also organise marketing activities on the basis of marketing functions.
7. Assembling necessary resources, such as marketing personnel, finance, and physical facilities, etc. to execute marketing campaigns.
8. Active participation in the product planning and development to establish best correlation between the product attributes and customer demands. Effective communication, proper control and co-ordination of all marketing functions.

(i) Organisation for Marketing:

The marketing department can be organised around the product to be sold if we have a line of products. It may be organised by function e.g., market research, advertising and sales promotion, pricing, and sales management.

Functional organisation is desirable when we have one or a few closely related products. When we have a national market and regional marketing problems demand special attention, organisation by territory may be preferred.

(ii) Marketing Plans:

Marketing management is responsible to formulate comprehensive marketing plans indicating objectives to be achieved, and a future course of action to accomplish the predetermined targets. A marketing plan is a main operational and control document of the marketing department.

It gives intelligent directions of marketing operations. It can inspire marketing staff to reach the targets as per plan. Progress can be measured against set goals. There will be no confusion and misunderstanding between marketing executives. All departmental plans can be integrated with each other.

Elements of Marketing Plan:

1. Marketing objective, e.g., 5% increase in market share or 20% increase in sales.
2. Marketing programme covering all elements of the marketing mix.
3. Time-bound marketing action plan.
4. Marketing budget with standards of performance.
5. Marketing controls to ensure predetermined goals.

We may have long-range plans covering five to ten or even fifteen years. Usually we have plans covering three to five years of the planning period. The first two years are covered in detail. We also have project plans even for one or two years covering specific projects outside the normal marketing field e.g., introduction of a new product, launching of a special sales campaign, etc.

For each component of a marketing mix we can have individual plans, e.g., advertising and sales promotion, distribution, product pricing etc. Research and planning activities form the basis of effective distribution particularly in mass markets. Corporate plans and policies are considerably influenced by the power of consumers in the market.

Effective Techniques for Conducting Market Research 

The marketing management concept is a management plan that views all marketing components as part of a total system that requires effective planning, organisation, leadership and control.

It is based on the importance of customers to a firm, and states that: 

1. All company policies and activities should be aimed at satisfying customer needs.
2. Profitable sales volume is a better company goal than maximum sales volume.

Technique – 1. Self Assessment: 

In order to conduct a successful marketing program you must be able to answer the following questions: 

1. What type of business are you in (manufacturing, merchandising or service)?
2. What is the nature of your product(s) or service(s)?
3. What market segments do you intend to serve? (Describe the age, sex, income level and life-style characteristics of each market segment.)
4. What strategies will you use to attract and keep customers?
5. What is your unique selling proposition (USP)?
6. Who is your competition and what will you do to control your share of the market?

To use the marketing concept effectively in a growing business, you should: 

1. Analyze your firm’s competitive advantage. What do you do best?
2. Identify specific markets you now serve.
3. Determine the wants and needs of your present customers.
4. Determine what you are now doing to satisfy those wants and needs.
5. Prepare a marketing plan that allows you to reach out to new customers or to sell more to your present customers.
6. Test the results to see if your new strategies are yielding the desired results.

Market research must be used in each of these six steps to help define your business for your customer’s interests, not your own. It is the process of learning what customers want or need and determining how to satisfy those wants or needs. It is also used to confirm whether the customer reacted to a marketing program as expected.

The benefits of market research include: 

1. Learning who your customers are and what they want.
2. Learning how to reach your customers and how frequently you should try to communicate with them.
3. Learning which advertising appeals are most effective and which ones get no response.
4. Learning the relative success of different marketing strategies, thus improving return on investment.
5. Learning how not to repeat your mistakes.

The dilemma for the small business owner is that, properly done, market research is quite expensive, takes time and requires professional expertise. Acquiring all the necessary data to reduce the risk to your venture may cost so much and take so long that you may go out of business. The answer is to find a quick and inexpensive way of getting enough data to help you make the right decision most of the time.

Some obvious pitfalls are: 

1. Using a sample that does not represent the total market.
2. Asking the wrong questions.
3. Not listening to the responses.
4. Building in biases or predispositions that distort the reliability of information.
5. Letting arrogance or hostility cut off communication at some point in the marketing process.

If you have a limited budget, develop the skills to hear what your customers and potential customers are telling you.

Some techniques worthy of consideration are: 

1. Advisory board-Occasionally convene a group of local people, whose opinions you respect, to act as a sounding board for new ideas. Choose your group with extreme care; one or two negative thinkers can distort the thought process of the entire group.
2. User group-Gather customers together to discuss new ideas. Their opinions can help you keep your business on track. Pick a neutral setting where the people will talk.

Be sure to reward the participants and share the credit for good ideas.

Technique – 2. Informal Survey: 

If you seek feedback from customers by simply asking, How was everything? you can be seriously misled. Most people, even those with legitimate complaints, are reluctant to speak out because they are afraid of appearing foolish.

This tendency is probably more widespread in smaller communities, where friendships often stand in the way of critical review. Also, if your attitude is such that customers feel complaining will not do any good, you may be antagonizing customers without even knowing it.

One solution is to take a few customers aside and ask them some sincere questions about how your business met their expectations and where it fell short. If the customer appears uneasy, do not press the issue-you will only force him or her to give you pat answers to escape the situation. If you get a good response, take notes. Follow-up letters thanking the customers and telling them what you plan to do with their suggestions will bring you friends for life.

Technique – 3. Suggestion Box: 

A suggestion box is a simple idea that works, but only if you do the following: 

1. Read the suggestions on a regular basis.
2. Do something about the suggestions you receive.
3. Reward those who give you good ideas by posting their names, writing letters to them or rewarding them with money or other things of value.

If you reward good results, you will get more good results. If you do not reward them, you will end up with an empty suggestion box and the mistaken idea that everything is fine.

Technique – 4. Sample Survey: 

Canvass the neighborhood to gather data. If you wish to remain anonymous, line up some marketing students to perform the survey or engage a local marketing agency. Be sure you establish a technique for getting a random sample as most people naturally attempt to attract respondents with whom they feel comfortable. Be sure to test your questionnaire to see that the questions are easily understood and are meaningful.

Technique – 5. Focus Group Interview: 

Get 10 to 15 people together in a relaxed setting and encourage them to talk about products or services they like or dislike. Use a moderator who can lead the group discussion without inhibiting the thought processes or limiting the expression of ideas and opinions. Tape record the session for later analysis.

Technique – 6. Brainstorming: 

This is a variation of the focus group, in which participants are encouraged to freewheel in their thinking to produce as many suggestions as possible without analyzing them. Again, a trained moderator will obtain the best results.

Technique – 7. Complaint Analysis: 

Encourage your customers to contact you directly if they have complaints. Respond to every complaint with a courteous letter assuring that you will correct the situation. A few disgruntled customers can be harmful. If your customers feel that they can work with you to solve their problems, you are sure to be successful.

Technique – 8. Comparison Shopping: 

Arrange with someone in a similar business located out of town to come to your town to shop your business and several of your competitors. Then return the favor and compare notes. This will avoid the danger of your becoming complacent about your premises and overlooking things that may be annoying or confusing to your customers.

Technique – 9. Customer Analysis: 

Tabulate information about customers regularly to determine such data as: 

1. Age.
2. Size of buying group (family, household, etc.).
3. Sex of the decision maker in the group.
4. Geographic location-Sort checks and sales slips by ZIP code, or ask customers to mark their home on a map with a colored pencil. Tabulate visitors versus local residents.
5. Average amount of purchase.
6. Coupon usage.
7. Response to recent advertising.
8. Radio station listened to itto.
9. Newspapers read.
10. Response to mailings.
11. Full price buyers versus those who respond to sales or specials.
12. Special populations in your area, such as college students, military personnel, senior citizens, hospital visitors, convention attendees, sports spectators, fair attendees, farmers, seasonal workers, car pools, pet owners, home owners, boat or recreational vehicle owners and athletic participants. The more you know about your customers the better you will be able to satisfy and even anticipate their needs.

Technique – 10. Customer Want List: 

Keep a notebook at your cash register and write down every request you receive for items you do not carry or have in stock. Periodic review of the list will give valuable clues about sales you are losing or new products and services you should consider carrying. You may learn of fad items, products being heavily advertised or items and services your competitors have dropped.

Your customers may be telling you they are dissatisfied with your competition and would prefer buying from you. You will be able to tell if other businesses in the area are in trouble, even before they know it themselves. You may also discover ways to make additional income by adding new departments or product lines or by developing a special-order business if your customers are willing to pay the added shipping costs and wait for delivery.

Technique – 11. Industry Analysis: 

On business trips or vacations, visit businesses similar to yours. Take pictures of signs, storefronts and displays, and talk to the owners to compare notes on new products, services and marketing techniques. Subscribe to trade journals and attend trade shows to keep current on marketing developments in your industry.

Technique – 12. Sales Representatives: 

Representatives who call on other similar businesses in your area can provide valuable information on business trends, new items and changes in the industry. Be sure the information is reliable.

Technique – 13. Advertising Notebook: 

Each ad that you run represents an investment. To make sure you maximize your investment, cut out each ad and tape it to a page in a three-ring notebook. Enter the date, medium and cost of the ad. Record the results of the ad in sales, inquiries or coupons redeemed. Divide the cost by the results to get a cost-per-inquiry factor that you can use to compare your ads and the media in which they appeared.

Technique – 14. Exit Interviews: 

When someone leaves your employ, be sure to spend sufficient time to find out exactly why he or she is leaving. Probe deep to learn what may be occurring in your business that causes hard feelings, employee conflict or customer dissatisfaction. It is important that your employees leave with a good feeling about you and your business, so they will not spread unfounded rumors.

Also, you may wish to keep them as customers. Employee turnover and training can be expensive to a business, so try to find out what you must do to keep employees and then decide if they are worth the price.