introduction & orientation of marketing

7/30/2019 Introduction & Orientation of Marketing

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Introduction &Orientation of

Marketing


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Marketing

2

Myth 6 No difference between marketing & selling

Myth busterSelling focuses

on the needs of the seller;

marketing on the needs of the

buyer.


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Introduction to Marketing

The future isnt aheadof us.

It has alreadyhappened.


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Marketing Concept versusSelling Concept

Starting Point Focus Means Ends

Factory ProductSell and

Promote itProfits through

sales volume

The Selling Concept

Market Customerneeds

Integratedmarketing

Profits fromsatisfied customers

The Marketing Concept


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What Can Be Marketed?

Goods

Services

Experien

ces

Events Persons

Places

Properties

Organizatio

ns

Information Ideas


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Simple Marketing System


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Modern Marketing System


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Common marketing problems

How can we identify and chooseprofitable market segments?

How can differentiate our offer from our

competition? How should we react to competitors?

How can we satisfy our customers and

build brand loyalty? How can we measure the effectiveness

of an add campaign, of Public Relations,

of a promotion, etc?


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The Need for Change

SATURATION The Changing Market

GLOBALISATION The Changing Competition

FRAGMENTATION

The Changing Consumer

DOWNSIZING

The ChangingOrganisation

PRESSURES FOR

MARKETING CHANGE


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Concept of Marketing


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Can you name acategory of products for

which your negativefeelings have softened?What precipitated

this change?

Discussion Questions


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Define the following concepts

Market .Marketing

Products .Selling

Services .Company

Needs .Retailers

Wants .Segmentation

Desire .Target

Prospect .Positioning

Customer .Promotion

CRM .Advertising

Environment


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Image of Marketing

Diff b t M k ti &


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Difference between Marketing &

selling


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In order to understand Marketing let us begin with theMarketing Triangle

Customers

CompetitionCompany


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Pair with another student to discuss the

following questions:

In what ways does the buying behavior

of you and your parents differ?

In what ways does the buying behavior

of you and your grandparents differ?

What selling strategies would workbest for:

You

Your parents

Interactive StudentAssignment


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Introduction To Marketing

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Simple Marketing System

(a collection

of sellers)

(a collection

of Buyers)

Goods/services

Money

Communication

Informatio


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WHAT IS MARKETING?

Marketing = Using Exchanges to

Satisfy Needs

American Marketing Association Definition

Marketingis the process of planning andexecuting the conception, pricing, promotion,

and distribution of ideas, goods, and servicesto create exchangesthat satisfy individual and

organizational goals.


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Who Buys and Uses What Is Marketed?

Ultimate Consumers

OrganizationalBuyers

THE BREADTH & DEPTH OF MARKETING

What Is Marketed?

Goods Services Ideas


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Dr. Rosebloom

The Evolution of Marketing

Production Era

Sales Era

Marketing Era

RelationshipMarketing Era


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Philosophies of Marketing

1. Production; affordability and availability.

2. Product -- quality and innovation.

3. Selling -- promotion and hard selling.4. Marketing -- customer satisfaction and

relationships.

5. Societal long-term value to both


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1-Production philosophy;it holds that consumers will favor products

that are available and highly affordable. Its

effective strategy in two situations:

-When a demand for a product exceeds the

supply.

-When the product cost is too high, and improve

productivity is needed to reduce the cost, togain market share.

Example; Evian water, McDonalds.


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2-Product philosophy;holds that consumers will favor a products

that offer the most in quality, performance,

and innovative features.In this case the company should focus on

the continuous improving.

Examples; Nokia Mobile, Motorola, Sony..


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3- Selling philosophy;

Holds that the customer will not buy enoughof the firms products unless it under-takes alarge-scale selling and promotion effort.

Example; Life-Insurance

-Marketing philosophy;Holds that achieving organizational goalsdepends on knowing the needs and wants oftarget markets and deliver value to competein the marketplace. The job is not to findthe right customers for your product, butthe right products for your customers.

Dell, Marriott, Disney


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5-Societal marketing philosophy;Balances human welfare, company profits

and consumer satisfaction

Example; Johnson & Johnson Credo honesty,integrity, and people before profit.


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Needs, wantsdemands

MarketsMarketing &

Marketers

Utility, Value &Satisfaction

exchange, Transaction

Relationships

Products

Core Concepts of Marketing


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Core Concepts of Marketing

Need food ( is a must )

Want Pizza, Burger, French fry's (

translation of a need as per our

experience )

Demand Burger ( translation of a

want as per our willingness and

ability to buy )

Desire Have a Burger in a five star

hotel


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Who is a Customer ??

Anyone who is in the market

looking at a product / service

for attention, acquisition, use

or consumption that satisfiesa want or a need

CUSTOMER IS . . . . .


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How Do Consumers Choose Among Products &Services?

Value - the value or benefits the customers gain fro

using the product versus the cost of obtaining the

product.

Satisfaction - Based on a comparison ofperformance and expectations.

Performance > Expectations => Satisfaction

Performance < Expectations => Dissatisfaction


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Marketing Environment

All the actors and forcesinfluencing the companys

ability to transact businesseffectively with its target

market


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Company

Demographic

Economic

Natural

Technological

Political

Cultural

Company

Customers

Intermediaries

Suppliers

Competitors

Public

Marketing Environment


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Market Environment

Includes:Microenvironment - forces

close to the company thataffect its ability to serve itscustomers.

Macro environment - largersocietal forces that affect thewhole microenvironment

The Microenvironment


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The Microenvironment

Company

Customers

Publics Suppliers

Competitors Intermediaries

Forces Affecting a

Companys Ability toServe

Customers


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Actors in the Microenvironment

C


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The Companys Microenvironment

Companys Internal Environment:Areas insidea company.

Affects the marketing departments

planning strategies. All departments must think consumer and

work together to provide superior customer

value and satisfaction.

Th C Mi i


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Suppliers: Provide resources

needed to produce

goods and services. Important link in the

value delivery system.

Most marketers treatsuppliers like partners.



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Marketing Intermediaries

Help to promote, sell and distribute goods to

final buyers Include resellers, physical distribution firms,

marketing services agencies and financial

intermediaries Effective partner relationship management is

essential

Defined as independent businessorganisations that directly assist

the flow of products and services between a

marketing organisation and its markets.


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Partnering With Intermediaries

Coca-Colaprovides Wendys

with much morethan just soft

drinks. It also

pledges powerful

marketing support.


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Customers:Five types of

markets that

purchase a

companys goods

and services


Customer Markets


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Customer Markets

Company

ConsumerMarkets

InternationalMarkets

GovernmentMarkets

BusinessMarkets

ResellerMarkets


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Competition

Competition refers to the

alternative firms that could

provide a product to satisfy a

specific markets need.


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Competition

Companies face competitionfrom three main sources:

Brandfrom

manufacturers of similar

products.

Substitute products

dissimilar products

satisfying the same needs. Indirectother firms trying

to win customers

purchasing power.


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Publics:

Publics:

Group that has an interest in

or impact on anorganization's ability to

achieve its objectives

T f P bli


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Types of Publics


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The Macroenvironment

The company and all of theother actors operate in a

larger macro environment offorces that shapeopportunities and pose

threats to the company.

The Compan s Macro en ironment


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The Companys Macro environment

The Macro environment


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The Macro environment

Demographic

Technological

Cultural Economic

Political Natural

Forces that Shape

Opportunitiesand Pose Threats

to a Company



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Demographic:The study of human populations in

terms of size, density, location, age,

gender, race, occupation, and otherstatistics.

Marketers track changing age and

family structures, geographic populationshifts, educational characteristics, and

population diversity.

S S G


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The Seven U.S. Generations

Key U S Demographic Trends


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Key U.S. Demographic Trends

Changing Age Structure

Population is getting older

Changing Family StructureMarrying later, fewer children,

working women, and nonfamily households

Geographic ShiftsMoving to the Sunbelt and suburbs (MSAs)

Increased Education

Increased college attendanceand white-collar workers

Growing Ethnic and Racial Diversity73% Caucasian, 12% African-American,

10% Hispanic & 3.4% Asian


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Changing age structure of the U.S.population is the single most

important demographic trend

Baby boomers, Generation X, and

Generation Y are the key groups

Demographic Environment

D hi E i t


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Born between 1946and 1964

Represent 28% of thepopulation; earn 50%of personal income

Earn more than half of all

personal income

Almost 25% belong to

racial or ethnic minority

Spend a lot on anti-aging

products and services

Are likely to postpone

retirement

Baby Boomers

Generation X

Generation Y

Key Generations


D hi E i t


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Born between 1965

and 1976

First latchkey children

Maintain a cautious

economic outlook

Respond to socially

responsible companies Will be primary buyers

of most goods by 2010

Baby Boomers

Generation X

Generation Y

Key Generations




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Born between 1977

and 1994

72 million strong;

almost as large a group

as their baby boomer

parents

New products,services, and media

cater to GenY

Challenging target for

marketers

Baby Boomers

Generation XGeneration Y

Key Generations


Economic Environment


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Economic Environment

In order for an economy to exist there must be a

market. A market exists where consumers have

money to spend and are willing to spend it.

The economic environment is a significantforce that affects the marketing of anyorganisation:

eg unemployment, inflation, interest rates.

also influences business cycles such as:prosperity recession recovery. Theseimpact on what people buy, when and

how.

Income Distribution


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Income Distribution

Walt Disney markets two distinct Pooh bears to match its two-tiered market.


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Natural Environment

Involves the natural

resources that are

needed as inputs bymarketers or that

are affected by

marketing activities.


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Environmental Responsibility

McDonalds has made a substantial commitment to the so-called

green movement.

T h l i l E i t


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Technological Environment

Most

dramatic

force now

shaping our

destiny.

Technology


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gy

Technology has had an

impact on our lifestyles,work, leisure, consumption

patterns and economic

well-being. Technology is a mixed

blessing: it may improve

our lives in one area while

creating environmental and

social problems in another.



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Changes rapidly.

Creates new marketsand opportunities.

Challenge is to make

practical, affordableproducts.

Safety regulationsresult in higher

research costs andlonger time betweenconceptualization and

introduction of product.

P liti l E i t


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Political Environment

Includes Laws,Government

Agencies, and

Pressure Groupsthat Influence or

Limit Various

Organizations

and Individuals In

a Given Society.

Increasing Legislation

Changing GovernmentAgency Enforcement

Increased Emphasis on Ethics& Socially Responsible Actions

C lt l E i t


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Cultural Environment

The institutions andother forces that

affect a societys

basic values,

perceptions,

preference, andbehaviors.



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Core beliefs and values are passedon from parents to children and are

reinforced by schools, churches,

business, and government. Secondary beliefs and values are

more open to change.

- forces that affect a societys basicvalues, perceptions, preferences, and

behaviors.



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Themselves

Others

Organizations

Society

Nature

The Universe


Societys MajorCultural Views

Are Expressed

in Peoples

Views of:

Assignment


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Assignment

Can you identify the trends that

have made the marketingconcept, the customer concept,and the societal marketing

concept more attractive modelsfor contemporary marketingmanagers? Give Reasons to

Support your answers.

Marketing Research Defined


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Marketing Research Defined

The systematic and objectiveprocess of generating

information for aid in makingmarketing decisions

Purpose


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p

The Marketing Research Process


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The Marketing Research Process

Defining theproblem

Analyzing thesituation

GettingProblem specificdata

Interpreting the

data

Solving the

problem

Marketing Research Process


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Marketing Research ProcessStep 1. Defining the Problem

A marketing manager should understand the target

market and what needs the firm can satisfy.

ExploratoryResearch

Descriptive

Research

Gathers preliminary informationthat will help define the problem

and suggest hypotheses.

Describes things as marketpotential for a product or thedemographics and consumers

attitudes.

2 A l i th it ti


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2.Analyzing the situation

when the marketing manager thinks the realproblem has begun to surface, a situation

analysis is an informal study of what

information is already available in theproblem area. It can help define the problem

and specify what additional information if any

needed. The situation analysis should alsofind relevant secondary data information &

primary data.

Analyzing Situation


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All data

Sources

Secondarydata sources

Primary data

sources

Inside company-

Company

filed,intranet,reports, MIS

people ,sales,

Out side Company-

Internet,liabraries,

government, tradeassociations,universities.

Observation

Equipment, personal

approaches

Questioning- In

depth and focus

group interviews

,online,mail,

S SExhibit 7-3


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2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwinfor use only with Essentials of Marketing

Sources of Primary and Secondary Data

Secondary Research


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Secondary Research

Develop the Research Plan


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Information That

Already ExistsSomewhere.

+ Obtained MoreQuickly, Lower

Cost.

- Might Not beUsable Data.

Develop the Research PlanGathering Secondary Information

BothMust Be:

Relevant

Accurate

Current

Impartial

Information Collectedfor the Specific

Purpose at Hand.

3 Getting problem specific data


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3.Getting problem specific data

The next step is to plan a formal

research project to gather primarydata. There are two basic methods for

obtaining information about

customers: Questioning andobserving.

Primary Data Collection Process


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Experimental Research

Primary Data Collection ProcessStep A. Research Approaches

Observational ResearchGathering data by observing relevant

people, actions, and situations

(Exploratory Information)

Survey ResearchAsking individuals about

attitudes, preferences or

buying behaviors

(Descriptive Information)

Experimental ResearchUsing groups of people to

determine cause-and-effect

relationships

(Causal Information)

Develop the Research Plan PlanningP i D t C ll ti


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Primary Data Collection

Who is to besurveyed?

(What SamplingUnit?)

How many

should besurveyed?

How should the

sample bechosen?

Probability orNon-probability

sampling?

Sample -representativesegment of the

population

SamplingPlans

4 Interpreting the data


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4.Interpreting the data

After someone collects the data, it has to beanalyzed to decide what it all means. After

collection they are to be classified and

tabulated into statistical summarization. They

may be in percentage, average, ratios, so as to

give the greatest value in the interpretation

work. A marketing manager must consider

whether the analysis of the data supports theconclusions drawn in the interpretation step.

5 Solving the problem


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5.Solving the problem

In the problem solution step,managers use the research results

to make marketing decisions.

When the research process isfinished , the marketing manager

should be able to apply the

findings in marketing strategyplanning- the choice of the target

market or the mix of the four Ps


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Can you name a companythat uses targeted mailingsto promote new products, orregional offerings?


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Marketing Information System

Assessing Marketing


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4-83

g gInformation Needs

MIS provides information to thecompanys marketing and other

managers and external partners such

as suppliers, resellers, and marketingservice agencies

The Importance of Information


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Why

InformationIs

Needed

MarketingEnvironment

StrategicPlanning

CustomerNeeds

Competition

Marketing Info System


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Marketing Info. System

Marketing Information System(MIS)

Consists of people, equipment,

and procedures to gather, sort,analyze, evaluate, and distribute

needed, timely, and accurate

information to marketing

decision makers.

Elements of a Complete Marketing Information System


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2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwinfor use only with Essentials of Marketing

Data Warehouse


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Data Warehouse

A place where databases arestored so that they are available

when needed. Data warehouse is

a sort of electronic library whereall of the data is indexed

extremely well. where data from

internal and external sources arecollected, organized and stored for

future analysis.

Decision Support System (DSS)


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A computer programan interfacebetween the

manager and the MIS

Makes it easy to get needed information

Search engines are a powerful tool for finding

whats neededEasy access to databases in a data warehouse

Makes it easy to analyze the information

May involve marketing modelsto show therelationships among different marketing variables

Is used as the manager is making decisions

A computer programme that makes it easy


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A computer programme that makes it easy

for a marketing manager to get and use

information as he or she is makingdecisions.

Market segment analysis

Market share analysis

Sales analysis

A marketing model is a statement of


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g

relationships among marketing variables

In short the decision support systemputs managers online so they can study

available data and make better

marketing decisions faster.

introduction & orientation of marketing

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