Just wondering how marketing and sales works and what should I know? Then this is the right place to begin. Let us know the basic set of jargons first to begin with:
1. Market Segmentation
The marketplace is a dynamic entity. Dynamic in multiple dimensions. One buyer is not necessarily similar to another. consumers differ in their wants, age, gender, location, income, attitude, and education.
Market Segmentation helps the marketer to split the market consisting of varied buyers, into smaller segments, which consists of a uniform buyer group, that can be reached more efficiently with a specific communication method, or served with a specific product. In general marketers practice four major segmentation techniques -
- Geographic Segmentation: This means splitting the market based on the location of the customer. This can be segments based on continents, nations, regions, states, districts, cities, or even neighborhoods.
- Demographic Segmentation: This divides the markets into groups based on variables like age, gender, income, education, religion, nationality, occupation, family size, and generation. This is one of the most popular segmentation techniques.
- Psychographic Segmentation: This technique divides the market into groups based on parameters like class, lifestyle, or personality traits.
- Behavoural Segmentation: This divides the market into groups based on parameters like knowledge, attitude, product use, response to a product, or occassion
Retailing involved the selling of products and/or to consumers for their personal or family use. Major stores like Big bazaar, Central, Shoppers Stop, Lifestyle are examples of retailers. Service providers like hotels, salons, and online stores like flipkart.com are also retailers.
Retailing is important as it is the final link in the supply chain. What is called a 'moment of truth' happens at retail level where consumers interact with the retailer and make buying decision. Retailers have salespeople who can answer questions, display the products so that the consumers can see what is available, and see it before buying. Retailers make the whole buying process less monotonous and more fun.
Retailers add value to products by making it easier for manufacturers to sell and consumers to buy. In the absence of retailers, it would be time consuming for consumers to find a manufacturer to buy a product. It will also be very costly for manufacturers to find, locate and distribute their products to the end customer.
Also refer Channel of Distribution.
3. Marketing Environment
Nothing in marketing is alien from other factors. There are several factors, or forces affecting managerial ability to conceptualise, build, convert and sustain positive relationships with target consumers. All such forces which affect marketing decisions are called market environment.
These are the factors affecting the marketing decisions directly. These can be in the form of direct stakeholders affecting business. For example suppliers, logistic partners, other partners, and consumers. The name micro should not be confused with small, as it is not always the case.
These are the factors affecting marketing decisions, but those which are out of direct control of the business. Factors like laws, international trade policies, culture, politics, economics, and technology are not controllable by the business. It is prudent for the management to account for such changes.
All factors which are internal to an organization are classified into internal environment. The are identified as 5Ms. They are Men, Materials, Machinery, Money and Markets. The process of monitoring and auditing internal changes are known as internal marketing.
External EnvironmentAll external factors affecting marketing decisions are audited and accounted for using the following tools.1. SWOT Analysis2. Michael Porters 5 force model and3. PEST analysis
4. Different Types of Retailers
Retailing as we have seen, is the last link in the supply chain. Retailers act as the interface between the final consumers and the product. They display the products available and facilitate easy sale for the manufacturer and easy product selection for the consumers. There are different types of retailers offering different services to consumers. Lets have a brief look into the types of retailers, and the services they offer.
Before we categorize the type of retailers, we should understand the scenario. In some places there are two major types of retailing. Organized retailing and unorganized retailing. An organized retailer is one who issues a tax invoice to the customer upon purchase, and pays sales tax and other related taxes. Unorganized retailer is one who does not. The usual Mom and Baby shop stores form part of this category. We analyse the different types of organized retailers here.
Retailers are broadly classified based on the following parameters
- Store based: Normally known as brick-and-mortar retailers
- Non-Store based: E-stores, Online Retailers, TV Retailers, Direct Mail Retailers
- Size: Drug Store, Convenience Store, Supermarket, Hypermarkets
- Merchandise: Speciality stores, Department Stores,
- Brands: Single Brand, Multi-Brand
- Pricing: Discount stores, Cash and Carry, Wholesale Club
5. "Me-Too" Brand
Copycat branding is perhaps the most negative deterring force that a marketer may have to face. Remember the Naik shoes or abcids travel bag that was available in the local flea market? These are nothing but copycat brands.
A copycat brand is characterized by very closely resembling communications similar to a leading brand. This can be in the form of logo, or name, colors used in the brand, or packaging. Copycat brands leverage the equity of leading brands by selling to customers who are not very aware of the brands and the ad communications. These are generally the simpletons from the remote villages. However copycat brands may also be prevalent in major cities and towns as well.
Copycat or me-too brands are encouraged by the short term benefits of such leveraging, and these, blind them from the possible legal implications which may include lawsuits, forced re-branding, or corporate embarrassment.