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Unit 1 of 4 · MBA Sem 2

Unit 1: Understanding marketing and consumers

Marketing Management notes · PTU syllabus (MBA 203-21)

3 min read10 topics10 exam questions
On this page
  1. Unit summary
  2. Definition, importance and scope of marketing
  3. Core concepts of marketing
  4. The marketing mix: 4Ps and 7Ps
  5. Marketing vs selling and marketing philosophies
  6. Customer value and satisfaction
  7. The marketing environment
  8. Corporate strategic planning
  9. Marketing information system (MIS)
  10. Consumer buying process
  11. Factors affecting buying behaviour
  12. Key terms
  13. Quick revision
  14. Important questions

Unit summary

Marketing starts with understanding customers and the forces around the firm. This unit covers the definition, importance, scope and core concepts of marketing, the marketing mix, marketing vs selling, customer value, the micro and macro marketing environment, corporate strategic planning, the marketing information system, and the consumer buying process and the factors that influence it.

After this unit you can

  • Define marketing and explain its importance, scope and core concepts
  • Explain the marketing mix, marketing vs selling and customer value
  • Analyse the marketing environment, strategic planning and MIS
  • Explain the consumer buying process and influencing factors

PTU syllabus topics

  • Definition
  • importance
  • scope and basic concepts of marketing
  • marketing mix
  • marketing vs selling
  • customer value
  • micro/macro marketing environment analysis
  • corporate strategic planning
  • marketing information system
  • consumer buying process and influencing factors
ProcessConsumer buying process
  1. 1Problem recognition
  2. 2Information search
  3. 3Evaluation of alternatives
  4. 4Purchase decision
  5. 5Post-purchase behaviour
1

Topic 1

Definition, importance and scope of marketing

Marketing is the process by which companies create value for customers and build strong customer relationships in order to capture value from customers in return (Kotler). The AMA defines it as the activity, set of institutions and processes for creating, communicating, delivering and exchanging offerings that have value for customers, clients, partners and society. Nature: customer-oriented, a continuous process, exchange-based, goal-oriented and both an art and a science. Scope: goods, services, events, experiences, persons, places, ideas, organisations and information can all be marketed.

2

Topic 2

Core concepts of marketing

ComparisonNeeds, wants and demands
Meaning
Example

Needs

Basic human requirements

Hunger, safety, belonging

Wants

Needs shaped by culture and personality

A pizza to satisfy hunger

Demands

Wants backed by ability and willingness to pay

Buying a ₹400 pizza from Domino's

Other core concepts: value (benefits − costs), satisfaction (performance compared with expectations), exchange, transactions, relationships and markets.

3

Topic 3

The marketing mix: 4Ps and 7Ps

The marketing mix is the set of controllable tools a firm blends to produce the response it wants in the target market (Neil Borden; 4Ps by E. Jerome McCarthy).

PDecisions
ProductVariety, quality, design, features, brand, packaging, services
PriceList price, discounts, allowances, payment terms
PlaceChannels, coverage, locations, inventory, transport
PromotionAdvertising, personal selling, sales promotion, public relations
People (services)Staff who deliver the service
Process (services)How the service is delivered
Physical evidence (services)Tangible cues: store design, uniforms, website
4

Topic 4

Marketing vs selling and marketing philosophies

ProcessEvolution of marketing concepts
  1. 1Production concept

    Consumers want cheap, available products — focus on efficient production

  2. 2Product concept

    Consumers want the best quality — focus on product improvement

  3. 3Selling concept

    Consumers must be persuaded — focus on aggressive selling

  4. 4Marketing concept

    Find needs and satisfy them better than competitors

  5. 5Societal marketing concept

    Satisfy needs while preserving consumer and society's well-being

ComparisonSelling concept vs marketing concept
Selling concept
Marketing concept

Starting point

Factory

Market

Focus

Existing products

Customer needs

Means

Selling and promotion

Integrated marketing

End

Profit through sales volume

Profit through customer satisfaction

5

Topic 5

Customer value and satisfaction

  • Customer perceived value (CPV): total customer benefit (product, service, personnel, image) minus total customer cost (monetary, time, energy, psychological).
  • Customer satisfaction: performance compared with expectations — dissatisfied, satisfied or delighted.
  • Customer lifetime value (CLV): present value of future profits from a customer over the relationship.
  • Value delivery: value chain (Porter) and value delivery network with suppliers and distributors.
6

Topic 6

The marketing environment

ClassificationThe marketing environment
Company

  • Micro: company itself

    Departments working together

  • Micro: suppliers and intermediaries

    Resellers, logistics, agencies

  • Micro: customers and competitors

    Markets served and rivals

  • Micro: publics

    Media, government, local communities

  • Macro: demographic and economic

    Population, income, spending

  • Macro: natural, technological, political, cultural

    Resources, innovation, laws, values

Exam tip

In exam answers, give an Indian example for each environmental factor — e.g. rising disposable incomes (economic) and UPI adoption (technological).

7

Topic 7

Corporate strategic planning

ProcessCorporate strategic planning
  1. 1Define the corporate mission
  2. 2Set objectives and goals
  3. 3Design the business portfolio

    BCG and GE matrices, growth strategies (Ansoff)

  4. 4Plan marketing and functional strategies
ProcessMarketing planning process
  1. 1

    Situation analysis

    SWOT, market and competitor analysis

  2. 2

    Marketing objectives

  3. 3

    Marketing strategy

    Segmentation, targeting, positioning

  4. 4

    Marketing mix programmes

  5. 5

    Budget

  6. 6

    Implementation

  7. 7

    Control

    Annual plan, profitability, efficiency and strategic control

8

Topic 8

Marketing information system (MIS)

A marketing information system consists of people, equipment and procedures to gather, sort, analyse, evaluate and distribute timely and accurate information to marketing decision-makers (Kotler).

ClassificationComponents of MkIS
Marketing information system

  • Internal records

    Orders, sales, inventory, receivables

  • Marketing intelligence

    Everyday information on developments — salespeople, distributors, competitors, online sources

  • Marketing research

    Systematic studies for specific problems

  • Marketing decision support system

    Data, models and software for analysis (CRM analytics, dashboards)

9

Topic 9

Consumer buying process

ProcessFive-step buying process
  1. 1Need recognition

    Gap between actual and desired state

  2. 2Information search

    Internal memory and external sources

  3. 3Evaluation of alternatives

    Compare brands on attributes

  4. 4Purchase decision

    Brand, store, quantity, timing, payment

  5. 5Post-purchase behaviour

    Satisfaction, repeat purchase or cognitive dissonance

Cognitive dissonance is post-purchase doubt ("Did I make the right choice?"); marketers reduce it with reassurance, warranties and follow-up. Types of buying behaviour: complex (high involvement, big differences), dissonance-reducing, habitual and variety-seeking.

10

Topic 10

Factors affecting buying behaviour

ClassificationFactors influencing consumer behaviour
Buyer

  • Cultural

    Culture, subculture, social class

  • Social

    Reference groups, family, roles and status

  • Personal

    Age and life-cycle stage, occupation, income, lifestyle, personality

  • Psychological

    Motivation, perception, learning, beliefs and attitudes

Key terms

Marketing concept
Achieving goals by satisfying target customers better than competitors
Customer value
Difference between total benefits and total costs to the customer
Macro environment
Broad forces — demographic, economic, natural, technological, political, cultural
BCG matrix
Portfolio tool using market growth and relative share
MIS
System for gathering and distributing marketing information

Quick revision

  • Marketing: definition, importance, scope; needs, wants, demands, exchange.
  • Marketing mix 4Ps and 7Ps; marketing vs selling; five philosophies.
  • Customer value, satisfaction and lifetime value.
  • Environment: micro and macro; strategic planning (BCG, Ansoff); MIS.
  • Buying process and cultural, social, personal and psychological factors.

Important exam questions

Practice questions written to the PTU exam pattern for this unit's syllabus: short answers (Section A style) and long answers (Sections B and C style).

Short-answer questions

  1. Q1.Define marketing.
  2. Q2.Distinguish marketing and selling.
  3. Q3.What is customer value?
  4. Q4.Name the components of the micro environment.
  5. Q5.What are the components of an MIS?
  6. Q6.List the stages of the consumer buying process.

Long-answer questions

  1. Q1.Explain the nature, scope and core concepts of marketing.
  2. Q2.Discuss the micro and macro marketing environment.
  3. Q3.Explain the corporate strategic planning process and portfolio tools.
  4. Q4.Explain the consumer buying process and the factors influencing it.

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