An Overview of Marketing

1. An Overview of Marketing 1 chapter Prepared by Deborah Baker Texas Christian University Chapter 1 Version 3e

2. Learning Objectives 1. Define the term marketing 2. Describe four marketing management philosophies 3. Explain how firms implement the marketing concept 4. Describe the marketing process and identify the variables that make up the marketing mix 5. Describe several reasons for studying marketing 1 chapter Chapter 1 Version 3e

3. 1 Learning Objective Define the term marketing Chapter 1 Version 3e

4. 1 What is Marketing? • Personal Selling? • Advertising? • Making products available in stores? • Maintaining inventories? All of the above, plus much more! Chapter 1 Version 3e

5. A Philosophy An Attitude A Perspective A Management Orientation A Set of Activities, including: Products Pricing Promotion Distribution 1 What is Marketing? plus Chapter 1 Version 3e

6. 1 What is Marketing? American Marketing Association Definition Marketing is the process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods, and servicesto create exchanges that satisfy individual and organizational goals. Chapter 1 Version 3e

7. At Least Two Parties Something of Value Necessary Conditions for Exchange Ability to Communicate Offer Freedom to Accept or Reject Desire to Deal With Other Party 1 The Concept of Exchange Chapter 1 Version 3e

8. 1 The Concept of Exchange The idea that people give up something to receive something they would rather have. Chapter 1 Version 3e

9. 1 Conditions for Exchange • There must be at least two parties and each party… • Must have something the other party values • Must communicate and deliver goods • Must be free to accept or reject offer • Must want to deal with other party Chapter 1 Version 3e

10. NO SALE 1 The Concept of Exchange • Exchange may not take place even if conditions met • An agreement must be reached • Marketing occurs even if exchange does not take place However... Chapter 1 Version 3e

11. 2 Learning Objective Describe four marketing management philosophies. Chapter 1 Version 3e

12. Competing Philosophies Production Sales Market Societal Marketing 2 Marketing Management Philosophies Chapter 1 Version 3e

13. Philosophy Key Ideas Production Focus on efficiency of internal operations Sales Focus on aggressive techniques for overcoming customer resistance Market Focus on satisfying customer needs and wants Focus on satisfying customer needs and wants while enhancing individual and societal well-being Societal 2 Marketing Management Philosophies Chapter 1 Version 3e

14. 2 Market Orientation Requirements • Top management leadership • A customer focus • Competitor intelligence • Interfunctional coordination • Customer relationships Chapter 1 Version 3e

15. Marketing that preserves or enhances an individual’s and society’s long-term best interests 2 Societal Marketing Orientation • Less toxic products • More durable products • Products with reusable or recyclable materials Chapter 1 Version 3e

16. 3 Learning Objective Explain how firms implement the marketing concept Chapter 1 Version 3e

17. 2 The Marketing Concept The idea that the social and economic justification for an organization’s existence is the satisfaction of customer wants and needs while meeting organizational objectives. Chapter 1 Version 3e

18. 2 The Marketing Concept Focusing on customer wants and needs can be a source of competitive advantage by: • Creating customer value • Maintaining customer satisfaction • Building long-term relationships Chapter 1 Version 3e

19. 3 Customer Value The ratio of benefits to the sacrifice necessary to obtain those benefits Chapter 1 Version 3e

20. 3 Customer Value Requirements • Offer products that perform • Give consumers more than they expect • Avoid unrealistic pricing • Give the buyer facts • Offer organization-wide commitment in service and after-sales support Chapter 1 Version 3e

21. 3 Customer Satisfaction The feeling that a product has met or exceeded the customer’s expectations. Chapter 1 Version 3e

22. 3 Maintaining Customer Satisfaction • Meet or exceed customer’s expectations • Focus on delighting customers • Provide solutions to customer’s problems Chapter 1 Version 3e

23. 3 Relationship Marketing The name of a strategy that entails forging long-term partnerships with customers, both individuals and firms. Chapter 1 Version 3e

24. Attracting a new customer may be TEN TIMES the cost of keeping an old customer 3 Relationship Marketing’s Importance Chapter 1 Version 3e

25. 3 Building Long-Term Relationships • Customer-oriented personnel • Effective training programs • Empowered employees • Teamwork Chapter 1 Version 3e

26. 3 Empowerment Delegation of authority to solve customers’ problems quickly. Chapter 1 Version 3e

27. 4 Learning Objective Describe the marketing process and identify the variables that make up the marketing mix Chapter 1 Version 3e

28. 4 Marketing Process Activities Understand the organization’s mission Set marketing objectives Gather, analyze, interpret “SWOT” information Develop a marketing strategy Implement the marketing strategy Design performance measures Evaluate marketing efforts--change if needed Chapter 1 Version 3e

29. 4 Environmental Scanning Collection and interpretation of information about forces, events and relationships in the externalenvironment that may affect the future of the organization or the marketing plan implementation. Chapter 1 Version 3e

30. 4 Environmental Scanning • Examination of macroenvironmental forces • Social • Demographic • Economic • Technological • Political / Legal • Competitive • Helps identify market opportunities • Provides guidelines for design of marketing strategy Chapter 1 Version 3e

31. 4 The Marketing Mix A unique blend of product, distribution, promotion, and pricing strategies designed to produce mutually satisfying exchanges with a target market. Chapter 1 Version 3e

32. 4 Marketing Mix: The “Four Ps” Price Promotion Place Product Chapter 1 Version 3e

33. 4 Product Strategies • The starting point of the “4 Ps” • Includes physical unit, package, warranty, service, brand, image, and value Product Chapter 1 Version 3e

34. 4 Distribution (Place) Strategies • Product availability where and when customers want them. • Involves all activities from raw materials to finished products Place Chapter 1 Version 3e

35. 4 Promotion Strategies • Role is to bring about exchanges with target markets • Includes integration of personal selling, advertising, sales promotion, and public relations Promotion Chapter 1 Version 3e

36. 4 Pricing Strategies • The most flexible of the “4 Ps” • Price X Units Sold = Total Revenue Price Chapter 1 Version 3e

37. 5 Learning Objective Describe several reasonsfor studying marketing. Chapter 1 Version 3e

38. 5 Why Study Marketing? • Plays an important role in society • Vital to business survival, profits and growth • Offers career opportunities • Affects your life every day Chapter 1 Version 3e

39. 5 Why Study Marketing? “Marketing is too important to be left to the marketing department.” --David Packard Hewlett-Packard Chapter 1 Version 3e

40. Professional Selling • Marketing Research • Advertising • Retail Buying • Distribution Management • Product Management • Product Development • Wholesaling 5 Why Study Marketing? • 1/4th to 1/3rd of the entire civilian workforce in the U.S. performs marketing activities • Fastest route up the corporate ladder Chapter 1 Version 3e

41. 5 Why Study Marketing? • Half of every dollar spent by consumers pays for marketing costs • Become a better-informed consumer Chapter 1 Version 3e