Marketing is the process of creating, communicating and delivering value to customers at a profit. It is much more than advertising: it starts with understanding a need and ends with a satisfied, returning customer. This article revisits the foundations and the classic mix of decisions.
1. The marketing concept
Business philosophies evolved through five orientations:
| Orientation | Focus | Weakness |
|---|---|---|
| Production | Make it cheap and available | Ignores what customers want |
| Product | Make the best product | “Marketing myopia” (Levitt): loving the product more than the need |
| Selling | Push persuasion | Short-term, ignores satisfaction |
| Marketing | Find and fill customer needs better than rivals | Needs research and coordination |
| Societal | Customer, company and society’s welfare | Higher cost, long-term gain |
Core terms: need (basic requirement), want (shaped by culture), demand (want backed by purchasing power), value (benefits minus cost), and exchange. Customer relationship management shifts the goal from one sale to customer lifetime value.
In the real world: Levitt’s point was that railways declined because they thought they were in the railway business instead of the transport business. A modern echo is a taxi firm that ignored ride-hailing apps because it saw itself as selling cars and licences.
2. The marketing environment
The firm operates within a microenvironment (suppliers, intermediaries, customers, competitors, the public) and a macroenvironment, scanned by PESTLE: political, economic, social, technological, legal and environmental forces. A SWOT analysis combines internal strengths and weaknesses with external opportunities and threats.
In the real world: a young, growing, smartphone-heavy Indian population and cheap data (a social and technological shift) created the market for UPI payments, short video and quick-commerce apps. A regulatory change, such as a ban on a product category, can end a business model overnight.
3. Consumer behaviour
Buyers pass through a buying process: need recognition → information search → evaluation of alternatives → purchase → post-purchase behaviour. Cognitive dissonance after a big purchase is why firms send reassurance.
| Influence | Examples |
|---|---|
| Cultural | Culture, subculture, social class; festivals drive gifting and gold purchases |
| Social | Reference groups, family roles, opinion leaders and influencers |
| Personal | Age and life stage, occupation, income, lifestyle, personality |
| Psychological | Motivation (Maslow), perception, learning, beliefs and attitudes |
Buyer types: routine (low involvement, habit: toothpaste), limited and extended problem solving (high involvement: a house). Organisational buying differs: more people (the buying centre of users, influencers, deciders, buyers and gatekeepers), rational criteria and long cycles.
In the real world: the Indian wedding season and festivals like Diwali drive large shares of annual sales of jewellery, apparel and consumer durables; brands time campaigns and offers around them. An influencer’s recommendation can work as a reference group effect.
4. Segmentation, targeting and positioning (STP)
| Step | Question | Tools |
|---|---|---|
| Segmentation | Who are the distinct groups? | Geographic (city, region), demographic (age, income), psychographic (lifestyle, values), behavioural (usage, loyalty, benefits sought) |
| Targeting | Which segments do we serve? | Undifferentiated (mass), differentiated (several segments), concentrated (niche), micro-marketing |
| Positioning | What place in the customer’s mind do we want? | Position on benefit, user, price-quality; a perceptual map compares brands on two dimensions |
A good segment is measurable, accessible, substantial, differentiable and actionable. A positioning statement reads: for [target], our brand is [category] that offers [key benefit] because [reason to believe].
In the real world: Maruti Suzuki targeted India’s first-time, price-sensitive family car buyers with cheap running cost and service reach. Tata Nano is widely cited as a positioning lesson: marketed as the “cheapest car”, it carried a stigma for status-conscious buyers who wanted to look upwardly mobile. Dove’s “Real Beauty” positioned the brand on a social idea, not just on soap.
5. The marketing mix
The classic 4 Ps (McCarthy) express the firm’s controllable tools; services add people, process and physical evidence (the 7 Ps). The modern customer-centred version is the 4 Cs: customer solution, cost, convenience and communication.
Product
A product has levels: core benefit, basic product, expected, augmented and potential. Classify by durability and use: convenience, shopping, speciality and unsought goods. Decisions cover branding (name, logo, brand equity), packaging, labelling, product line and mix (width, length, depth) and services.
The product life cycle (PLC): introduction, growth, maturity, decline, with different strategies at each stage (build awareness; build share; defend and differentiate; harvest or drop). The Ansoff matrix lays out growth: market penetration, market development, product development and diversification. The BCG matrix sorts a portfolio into stars, cash cows, question marks and dogs.
In the real world: Parle-G has remained in maturity for decades through consistent pricing and wide distribution. Nokia missed the shift to smartphones and lost its lead, while Amul extended its brand across the dairy line (butter, cheese, ice cream).
Price
Pricing is the only P that earns revenue. Factors: cost, demand, competition, perceived value and legal limits. Methods: cost-plus, target return, perceived-value, going-rate and auction pricing. Strategies: skimming, penetration, psychological (₹999), bundling, discounts and dynamic pricing (see Managerial Economics).
In the real world: Nirma entered with a much cheaper detergent for lower-income households and took share from premium brands. Apple’s premium pricing is a perceived-value strategy.
Place (distribution)
Channels connect producers to buyers: direct, or through wholesalers, distributors and retailers. Decisions: channel length, intensity (intensive, selective, exclusive), channel conflict and logistics. Growth in e-commerce, omnichannel and quick delivery has reshaped it, and direct-to-consumer (D2C) brands bypass retail.
In the real world: FMCG companies such as Hindustan Unilever reach millions of small shops through distributor networks, which is a major competitive advantage in India. Amazon and Flipkart shifted much of retail online.
Promotion
Integrated marketing communications (IMC) coordinates the promotion mix: advertising, sales promotion, personal selling, public relations and direct/digital marketing. The AIDA model (attention, interest, desire, action) is the usual message structure. Push strategy moves product through the channel; pull strategy creates consumer demand.
In the real world: Cadbury’s “Kuch Meetha Ho Jaye” and Amul’s topical ads are long-running campaigns that built distinctive memory. Today, performance marketing on search and social measures each click and conversion, and influencer marketing builds trust.
6. Marketing ethics and the larger picture
Marketing carries responsibilities: truthful advertising, protection of children, consumer privacy, and avoiding greenwashing. The Consumer Protection Act in India sets rights and remedies. Services marketing, branding, digital marketing and marketing research are developed in later parts of the course.
One-minute recap
| Topic | Key idea | Where you meet it |
|---|---|---|
| Marketing concept | Customer first; value; lifetime value | Strategy, retention |
| Environment | PESTLE, SWOT | Planning, new markets |
| Consumer behaviour | Buying process, influences | Targeting, campaigns |
| STP | Segment, target, position | Brand strategy |
| Product | Levels, branding, PLC, Ansoff, BCG | Portfolios, launches |
| Price | Cost-plus, value, skimming, penetration | Pricing decisions |
| Place | Channels, omnichannel, D2C | Distribution |
| Promotion | IMC, AIDA, push and pull | Campaigns, digital |
Next in MBA Revisited: IT for Management.
Written by Claude, Anthropic’s AI assistant, as part of MBA Revisited, a quick refresher of the PGDM subjects one at a time.