Topic 1

Marketing
is the process of planning and
executing the conception, pricing, promotion, and
distribution of products, services, and ideas to
create exchanges that satisfy individual wants and needs and organizational objectives.
Marketers can be…
Organizations
• Businesses selling goods & services
• Non-profit organizations selling services, ideas
• Government agencies
Individuals
• You, marketing yourself
• Politician, marketing herself, ideas
Markets can be…
Consumers, like you and me
Businesses that buy
• Products to operate firms
• Products to make into other products
Non-profit organizations
Governmental entities
Publics
Market
People or organizations with needs,
an exchange medium, and a
willingness to engage in the
exchange process.
• The actual or potential buyers of a product.
• Exchange medium is “money.”
• Willingness to “exchange” is a willingness to
“buy”.
Form Utility
Satisfaction Generated by
• How the product functions
• How well it works, its inherent reliability
Buy many products primarily for this type of utility
• Tools — screw driver, electric drill, table saw
• Appliances — vacuum cleaner; dishwashers
• Computers
Time Utility
Satisfaction generated by having products ‘when’ we want them…
Examples.. • Drive-thru windows
• Fast lanes in grocery stores
• ATMs
• Late night service
• Wendy’s Rules the Night! • 24 Hour Fitness (Gym)
Often willing to pay more because of the value we place on our ‘time
Place Utility
Satisfaction generated by having products ‘where’
we want them…
Examples..
• Retail ‘convenience’ stores
• 7-11, E Z Check
• Co-located gas stations & restaurants
• Vending machines, ATMs
• In home delivery…
• In home shopping
• Catalogs, mail-order
• WWW
Possession Utility
Ownership
• Legally obtain benefits of the product
• Usually results from purchase i.e. title has been transferred to user
Possession utility also results from
• Renting
• Leasing
• Borrowing?
Created with pricing and financing options
Image Utilty
Ego, Social Communication
Closely tied to self concept
Examples:
Designer Cars and clothes
Jewelry
Homes
trading values between exchange partners
Concept Check
Which of the following best reflects the concept of
‘exchange’ in marketing?
a. Trading values between exchange partners
b. Delivering want satisfaction to markets
c. Generating profits from sales
d. Creating synergistic marketing mixes
e. All of the above.
form
Concept Check
Which of the following ‘utilities’ is least likely to be
created solely by the marketing function in the
firm?
a. Possession
b. Time
c. Place
d. Image
e. Form.
image
Concept Check
Attaching an attractive life style to a product via
advertising is generally an attempt to create
____________ utility.
a. Form
b. Time
c. Place
d. Possession
e. Image.
Marketing Mix
the specific
combination of
inter-related and
interdependent
marketing
activities employed
by organizations to
meet objectives.
Product
A good, service, or idea that offers a bundle
of tangible and intangible attributes to
satisfy customers’ wants & needs.
Place or Distributon
That element of the marketing mix involving
all aspects of getting products to consumers
at the right location and at the right time
Channel of Distribution
.the people and organizations
involved in moving a product from
producer to the consumer…
Price
a measure or expression of the value (in
terms of money, goods, or services) of a good or
service….
marketing
Concept Check
The combination of product, price, promotion, and
distribution is generally referred to as _____________.
a. Marketing
b. The marketing “tool kit”
c. The “marketing mix”
d. Market targeting
e. None of the above.
price
Concept Check
A measure or expression of the value (in terms of money,
goods, or services) of a good or service is most closely
associated with which component of the marketing mix?
a. Product
b. Promotion
c. Place
d. Price
e. None of the above.
promotion
Concept Check
A good, service, or idea that offers a bundle of tangible
and intangible attributes to satisfy customers’ wants &
needs is most consistent with which element of the
marketing mix ?
a. Product
b. Promotion
c. Place
d. Price
e. None of the above.
sales promotion
Concept Check
The use of premiums illustrated in the TWIP commercial
for breakfast cereal illustrates an application of the
_______ component of the promotion mix.
a. Advertising
b. Sales promotion
c. Personal selling
d. Public relations
e. Publicity.
Marketing Concept
• To be customer oriented;
• To stress long-run profitability; and
• To integrate marketing with other
corporate functions.
Production Concept
Philosophy
Acceptable quality products at
affordable prices sell themselves
Objective
Minimize costs to lower prices,
keep quality high.
How?
Focus on Production & Distribution
Efficiency
Product Concept
Philosophy
Customer desire high quality,
innovative features, performance in
products. Such products “sell
themselves.”
Objective Continuous product improvements
How? R&D and production innovation
Selling Concept
Philosophy
Products don’t necessarily sell
themselves. Customers must be
convinced to buy products.
Objective Maximize sales revenue
How? Aggressive promotion to create demand
An ‘inside-out’ perspective.
Marketing Concept
Philosophy Satisfied Customer Wants and Needs
Objective Customer & profit orientation in whole firm
How? Focus on total marketing mix
An ‘outside-in’ perspective
Societal Marketing Concept
Philosophy
Satisfied Customer Wants and Needs
Objective
Customer & profit orientation in whole
firm; Society’s interests protected.
How?
Focus on total marketing mix tempered
with social concern
• act in a socially responsible manner;
• consider the ethical consequences of their actions;
and
• consider the collective needs of society as well as customer desires or the organization’s profits
Relationship Marketing
Philosophy Satisfied Customer Wants and Needs. Strong
relationships with all business partners
leads to improved customer satisfaction.
Objective
Building long-term relationships with
customers & business partners to enhance
profits across entire channel.
How?
Focus on total marketing mix. Treat all
channel members and other business
partners as valued members of the team.
is a ‘philosophy of doing business which places the customer at the focal point of most decisions in the firm
Concept Check
The definition of the marketing concept, in contrast to the
definition of marketing
a. Focuses on deploying elements of the marketing mix to create satisfying exchanges with customers
b. Is a ‘philosophy’ of doing business which places the customer at the focal point of most decisions in the firm
c. Stresses the importance of promotion to create customer utility
d. Focuses mainly on creating exchanges that satisfy the firm’s
objectives
e. There is no difference between the two, they are essentially the same things.
the recognition by businesses that ‘high quality products will sell themselves’
Concept Check
The emergence of the selling concept as a philosophical alternative to the production concept was primarily the result of
a. The recognition by businesses that ‘high quality products will sell themselves.”
b. Customer dissatisfaction with attempts by businesses to influence customers to buy products they don’t want or need.
c. Changes in the relationship between supply and demand during the Great Depression.
d. Recognition by firms that they must be responsive to the long term needs of society with their marketing practices.
e. That suppliers and other channel members should be treated as ‘customers’.