Unit 2

Introduction to Marketing
Management
By:

Sanjay Manocha

BVIMR, New Delhi

Functions of Marketing Management or Scope of

Marketing Management
Marketing management involves all those activities required to be performed for
satisfying consumers at profits.
Following functions can be included in scope of marketing management.

1. Setting Marketing Goals

i.The prime task of marketing manager is to set marketing goals and objectives.
ii.Clearly and precisely defined objectives can help marketing manager to direct
marketing efforts effectively.
iii.The goals, and objectives (whether strategic and operating, long-term or shortterm) must be suitably communicated with the employees concern.
iv.As far as possible, objectives should be expressed in quantifiable terms.
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2. Selecting Target Market

i.Segmenting total market and selecting target market is fundamental task of
marketing management.
ii.Modern marketing practice is based on target market, and not on total
market.
iii.Marketing manager cannot satisfy the needs and wants of entire market.
iv.He must concentrate his efforts only on well-defined group of customers,
known as the target market.
v.All the marketing functions are directed to cater needs and wants of target
market only.

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3. Formulating Suitable Organisation Structure For

Marketing Department
To implement marketing plan, a suitable organisation structure is essential.
There are different types of organization structure. They can be created on the basis
of arrangement of activities in the organization. There are three types of structural
forms in the organization and they are:
Formal and informal framework of policies and rules, within which an organization
arranges its lines of authority and communications, and allocates rights and duties.
Organizational structure determines the manner and extent to which roles, power.
and responsibilities are delegated, controlled, and coordinated, and how information
flows between levels of managements.
1. Functional Structure
It is the organizational structure that is based on the functions of the units and subunits of activities.
Every organization has specialized functions and they constitute as separate units
of the organization.
The entire activities that are connected with such functions are placed in the same
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unit.

2. Divisional Structure
This type of structure is well suited for large enterprise.
It works effectively to those large enterprises that deal in multiple
products serving many distinct markets.
The division of organization takes place into small business units
that are entrusted with business related to difficult products or
different market territories.
All the divisional managers are given authority and autonomy to
run all function relating to their respective products or marketing
segments or regional markets.
Each division contributes planned profits to the organization but
works as independent business.
Managers head the functional units while divisional managers take
the final authority.

In this type of arrangement, top management determines

the organizational goals and formulates policies.
This type of structure is characterized by the
decentralization of authority.
It enables managers to take decision promptly and helps
them resolve problems that are related to their respective
divisions.
Divisional managers are provided with opportunities to
take initiative in matters that are within their jurisdiction.

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3. Adaptive Structure
a) Project organization
This type of organization is suitable when an organization undertakes specialized
work for a particular period as one time operation.
In order to deal with such situations organizations develops a unit which is
specially designed to accomplish such project works without disturbing the
routine jobs of the organization.
The organizations engage their existing employees on deputation basis to deal
with a particular project and then that particular executive resumes to his parent
department after the completion of the project.
The advantage of such organizations is that it does not disturb the regular work
of the organization.
It enables the better control over the project activities because the managers
enjoy the authority to function the projects effectively.
But at times these organizations spoil the stability of the various departments as
the personnel are shifted for the sake of the project and thus disrupt the basic
functioning of the parent department.
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Matrix Organization:
It aims to combine the advantages of autonomous project organization and
functional specialization.
In this structure functional departments are having full time specialized workers
to accommodate and are capable of handling more than one project at a time.
This is found suitable as the organization is most of the time engaged in the
project activities and the managers are also more in number and can accomplish the
project work effectively.
It provides for the flexible system of working as it adapts the changes quickly.
The demerit of such organizations is that the employees are engaged in dual jobs
and are burdened with more work which affects the unity of command at times in
the organization.

4. Maintaining Healthy Relations With Other

Departments
Marketing department needs cooperation from other departments of
organisation, such as financial department, personnel department, and
production department.
Their support is considered to be important to satisfy consumers.
Thus, for integrated efforts, marketing manager should try to establish good
relations with them.
Likewise, within marketing department, he must establish coordination among
various personnel.

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5. Establishing And Maintaining Profitable Relations

With Outside Parties
Alike internal support, the external relations are also extremely necessary.
Marketer, in order to carry out marketing activities effectively, must establish
and maintain healthy relations with various parties such as suppliers, service
providers, government agencies, dealers, consultants, and so forth.
Without their support, marketing manager can not carryout functions
successfully.
Due to important role of external relations, contemporary marketing practice
can be said as relationship marketing.

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6. Marketing research activities

Marketing research is one of the important functions of modern marketing.
Marketing research is the systematic gathering, recording, and analysis
of data about issues relating to marketing products and services.
It provides the valuable information on which marketing decisions can be
taken.
Marketing research is essential to know adequately about consumers and
market situation.
It is a basic function to satisfy consumers.
Marketing efforts are based on such information.
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7. Sales Management
Sales management is one of the important functions of marketing management.
Sales management concerns with planning, implementation, and controlling
selling efforts.
It performs all the activities related to execution of sales.
Sales department carries out selling functions.
Sales department formulates sales policies, ensures adequate quantity of
products, maintains sales records, formulates structures for sales department,
manages sales force, and controls selling efforts.

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8. Product Decisions
Product mix is a combination of products manufactured or traded by the same
business house to reinforce their presence in the market, increase market share and
increase the turnover for more profitability.
One of the realities of business is that most firms deal with multi-products .
This helps a firm diffuse its risk across different product groups.
Also it enables the firm to appeal to a much larger group of customers or to
different needs of the same customer group .
So when Videocon chose to diversify into other consumer durables like music
systems ,washing machines and refrigerators ,it sought to satisfy the needs of the
middle and upper middle income group of consumers.
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Likewise , Bajaj Electricals, a household name in India, has almost ninety

products in its portfolio ranging from low value items like bulbs to high priced
consumer durables like mixers and luminaries and lighting projects .
The number of products carried by a firm at a given point of time is called its
product mix.
This product mix contains product lines and product items .
In other words its a composite of products offered for sale by a firm.
Product Mix Decisions
Often firms take decisions to change their product mix.
These decisions are dictated by the above factors and also by the changes
occurring in the market place.
Like the changing life-styles of Indian consumers led BPL-Sanyo to launch an
entire range of white goods like refrigerators , washing machines, and
microwave ovens .
It also motivate the firm to launch other entertainment electronics.
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Rahejas, a well-known builders firm in Bombay, took a major decision to

convert one of its theatre buildings in the western suburbs of Bombay into a
large garments and accessories store for men ,women and children, perhaps
the first of its kind in India to have almost all products required by these
customer groups.
Competition from low priced washing powders (mainly Nirma) forced
Hindustan Levers to launch different brands of detergent powder at different
price levels positioned at different market segments .
Customer preferences for herbs, mainly shikakai motivated Lever to launch
black Sunsilk Shampoo ,which has shikakai .
Also ,low purchasing power. and cultural bias against shampoo market
made Hindustan Lever consider smaller packaging mainly sachets , for single
use .
So, it is the changes or anticipated changes in the market place that
motivates a firm to consider changes in its product mix.
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9. Pricing Decisions
One of the four major elements of the marketing mix is price.
Pricing is an important strategic issue because it is related to product
positioning.
Furthermore, pricing affects other marketing mix elements such as product
features, channel decisions, and promotion.
The price you set for your offering plays a large role in its marketability.
Pricing for offerings that are more commonly available in the market is more
elastic, meaning that unit sales will go up or down more responsively in
response to price changes.
By contrast, those products that have a generally more limited availability in
the market (but with strong demand) are more inelastic, meaning that price
changes will not affect unit sales very much.
The price elasticity of your offering can be determined through various market
testing techniques.
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10. Marketing Promotion Decisions

Promotion is concerned with any vehicle you employ for getting people to
know more about your offering.
Advertising, public relations, point-of-sale displays, and word-of-mouth
promotion are all traditional ways for promotion.
Promotion can be seen as a way of closing the information gap between wouldbe sellers and would-be buyers.
Your choice of a promotional strategy will be dependent upon your budget, the
type of offering you are selling, and availability of said promotional vehicle.

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11. Distribution related Decisions

This term really refers to any way that the customer can obtain a product.
'Place' is concerned with various methods of transporting and storing goods, and
then making them available for the customer.
Getting the right product to the right place at the right time involves the
distribution system.
The choice of distribution method will depend on a variety of circumstances.
It will be more convenient for some manufacturers to sell to wholesalers who then
sell to retailers, while others will prefer to sell directly to retailers or customers.
The ease and options through which you can make your product available to your
customers will have an effect on your sales volume.
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12. Exercising Effective Control On Marketing

Activities
Control is essential to ensure that activities are conducted as per plan.
Control involves establishing standards, measuring actual performance,
comparing actual performance with standards, and taking corrective actions,
if needed.
Control keeps the entire marketing department alert, active, and regular.
Marketing manger should setup effective controlling system to monitor
marketing efforts.

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