What’s

Marketing?
 Part One

Managing Change
and Innovation

4/1/2024 Hamed Ali

@[email protected] 3
 Product

• There are many things to consider when

choosing a product to sell:
– What do people want?
– What services should be included with the sale
of a product?

The 4 “P”s of Marketing

Product, Price, Place, and Promotion
4/1/2024 Hamed Ali
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 Price

• The price is what the customer must give

up to receive the product. It often is
necessary to try different prices periodically
to see which prices provide the best
financial returns.

4/1/2024 Hamed Ali

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 Place
(also known as distribution)

• It is important to make sure that there is

enough of a product on hand to sell.
– For instance, if there is a sale, then enough of a
product should be available so that customers
can be satisfied.

4/1/2024 Hamed Ali

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 Promotion
(Customer Awareness)

• Promotion involves all that goes into

making consumers aware of your product
and its desirable features, including:
– Advertising.
– Personal selling.
– Sales promotion.

4/1/2024 Hamed Ali

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 The today's business environment
Technological
development
Worldwide competitive Mergers & acquisitions
environment between companies

Demanding Product life cycle

customers shortening

Employees new New Legal

profiles environment

4/1/2024 Hamed Ali

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 .......we all believe that by globalization
and in an environment with no trade
barriers, the world will became a single
united market. Whoever reaches it first
will become the best.

4/1/2024 Hamed Ali

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 WHAT IS MARKETING?

Marketing is everyone’s business. Every person working for

an organisation should understand the importance of
marketing.

▪ Definitions:
“ Marketing is the management process responsible for
identifying, anticipating and satisfying consumer
requirements profitably”

“Marketing is the process of planning and executing the

conception, pricing, promotion and distribution of ideas,
goods and services to create exchange and satisfy individual
and organisational needs.”
Hamed Ali 1-10
4/1/2024 @[email protected]
 Basics of Marketing
• Effective marketing puts the products in the
hands of its targeted customers.

• A market is a group of customers who share

common wants and needs, and who have the
ability to purchase a particular product.

• Marketing is the process of creating, promoting,

and presenting a product to meet the wants and
needs of consumers.

4/1/2024 Hamed Ali

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MARKETING IS AN ORGANISATIONAL FUNCTION

The diagram below shows the many functions that can

be carried out in organisations which, dependant on the
organisation, can be classified as operational functions
of marketing.
CRM Sales Promotion Advertising P.R.

Selling
Display

Financing
Stockholding
The operational
functions of marketing Buying
Servicing
Forecasting

Risk Taking
Pricing

Transporting Market Research Merchandising Publicity

Hamed Ali 1-12

4/1/2024 @[email protected]
MARKETING AS A BUSINESS CONCEPT

The Exchange Process

Something of value

Goods, services, benefits

Supplier Customer

Money, exchange of goods

Something of value

Hamed Ali
4/1/2024 @[email protected] 1-13
 EXCHANGE TRANSACTIONS
Consumers Costs & Benefits Organisations

Cash

Quench
thirst
Customer Pepsi

Insurance
premiums
Medical
treatment
Patient Private Hospital

Fees

Education
Student University

4/1/2024 Hamed Ali

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 EXCHANGE TRANSACTIONS

Consumers Costs & Benefits Organisations

Time

Sense of
community
Volunteer service Non-profit youth group

Vote

Sense of economic/social
progress continued
Voter employment etc Politic Party

Taxes

Reader
Lone parent Public Library, Benefit agency

4/1/2024 Hamed Ali

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 CORE CONCEPTS OF MARKETING

Needs Products/ Value

Wants Services &
Demand Satisfaction

Exchange
Process
Markets Marketing

Exchange
Transactions
Relationships

4/1/2024 Hamed Ali

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 Marketing Mix: The 4 Ps

Place

The Marketing Mix

Promotion Product

Price
4/1/2024 Hamed Ali 1-17
@[email protected]
 Importance of 4Ps by Industry –
examples of promotions
Consumer Goods Industrial Goods
High
Advertising Personal Selling

Sales Promotion Sales Promotion

Importance

Personal Selling Advertising

PR PR
Low

4/1/2024 Hamed Ali

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 Push versus Pull

Demand Demand

Push Strategy Manufacturer Intermediary End User

e.g Lever Brothers

Demand Demand

Pull Strategy Manufacturer Intermediary End User

e.g. P & G

4/1/2024 Hamed Ali

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 The Marketing “Mix”

4/1/2024
Hamed Ali 1-20
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 Marketing Mix – 4Ps
The marketing mix elements that make up an
organization’s marketing program:

1. Product
2. Promotion
3. Price
4. Place
These are management decisions,
controllable factors

4/1/2024 Hamed Ali

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 Marketing function relates to many
people, groups, and forces

@[email protected]
Hamed Ali
1-22
4/1/2024
Marketing’s
first task:
discovering
consumer
needs

4/1/2024 Hamed Ali 1-23

@[email protected]
Marketing’s second task: satisfying
consumer needs

Hamed Ali 1-24

@[email protected]
 A Good Marketing Plan

• A good Marketing Plan details what you want to accomplish and

helps you meet your objectives.
• A Marketing Plan should:
– Explain (from an internal perspective) the impact and results
of past marketing decisions.
– Explain the external market in which the business is
competing.
– Set goals and provide direction for future marketing efforts.
– Set clear, realistic, and measurable targets.
– Include deadlines for meeting those targets.
– Provide a budget for all marketing activities.
– Specify accountability and measures for all activities.
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Hamed Ali
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 Overall Planning Process

• You should create and Feedback and Control Process

implement your Marketing Plan.
• Some major steps involved in MONITOR
this process are:
– Planning
• Define your corporate mission
• Establish business units SIGNOFF MEASURE
• Assign resources to business
units
• Assess growth opportunities
– Implementing
– Gaining Feedback and Control
• Measuring results CORRECT INPUT
• Diagnosing results
• Taking corrective action
26
Hamed Ali
4/1/2024 @[email protected]
 The Marketing Challenge

Ask yourself these five critical questions:

1. What is unique about your business idea? What is the
general need that your product or service aims to meet?
2. Who is your target buyer? Who buys your product or
service now, and who do you really want to sell to?
3. Who are your competitors? How can your small business
effectively compete in your chosen market?
4. What positioning message do you want to communicate to
your target buyers? How can you position your business or
product to let people know about your product?
5. What is your sales strategy? How will you get your product
or service in the hands of your customers?

27 Hamed Ali
4/1/2024 @[email protected]
 The 10 Elements of a Good
Marketing Plan
A good Marketing Plan includes these 10 elements:
1. Describe Your Business
2. Conduct a Situation Analysis
3. Define Your Customer
4. Strategize Your Market Entry
5. Forecast your Sales or Demand Measurement
6. Define Your Marketing Budget
7. Integrate Your Marketing Communication
8. Identify Sales Channels
9. Track Marketing Activities
10. Evaluate Your Progress
28
Hamed Ali
4/1/2024 @[email protected]
 1. Describe Your Business

• Small business owners often describe themselves by their

product or services; however, business must be viewed as a
customer-satisfying process, not goods-producing.
• Describe your business in detail and clearly identify goals and
objectives.
• Answer the following questions:
– What is your product or service?
– How will your product benefit the customer?
– What is different about the product your business is offering?
– Is it a new business, a takeover, or an expansion?
– Why will your business be profitable?
– What are the growth opportunities?
– What is your geographic marketing area?

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Hamed Ali
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 2. Conduct a Situation Analysis
▪ A situation analysis details the context for your
marketing efforts by considering internal and Strengths Weaknesses
external factors that could influence your
marketing strategy.
▪ This section of the plan could include a SWOT
analysis to summarize your Strengths, Opportunities Threats
Weaknesses, Opportunities and Threats.
– Strengths: assets or a resources that can be used to improve your
business’ competitive position.
– Weaknesses: resources or capabilities that may cause your business to
have a less competitive position.
– Opportunities: situations or conditions arising from a business’
strengths, or set of positive externalities.
– Threats: problems that focus on your weaknesses and which can create
a potentially negative situation.
30
Hamed Ali
4/1/2024 @[email protected]
 3. Define Your Customers
Defining your market does not need to be a difficult process. You do not
need a huge market base, but you need to be realistic and your market
needs to be well-defined.
– Who are your competitors, and who do they target?
– Who is your perfect customer and client base?
– What is your current customer base (in terms of age, sex, income, and
geographic location)?
– What habits do your customers and potential customers share? Where do
they shop, what do they read, watch, listen to?
– What prospective customers are you currently not reaching? How can you
reach them?
– What qualities do your customers value most about your product or
service? Do they value selection, convenience, service, reliability,
availability, or affordability?
– What qualities about your product or service do you need to improve? How
can they be adjusted to serve your customers better?
31
Hamed Ali
4/1/2024
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 4. Strategize Your Market Entry

Once you have identified what is unique about your business and
who your target buyers are, focus on your competition:
– Identify your direct competitors and learn what they do.
– Sharpen your decisions about the best business category
and market segment in which to compete.

4/1/2024 32 Hamed Ali

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 5. Forecast Sales or Demand
Measurement
• Sales forecasting provides the basis for comparison over a
period of time.
• Market demand is the total volume that could be bought by a
defined customer group in, a defined geographical area, in a
defined time period, and under a defined marketing program.
• You should:
– Correctly identify and estimate current demand by
considering total market potential, market share, and
expected sales.
– Estimate future demand by considering past sales patterns,
consumer trends, and overall market projections.

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Hamed Ali
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 6. Define Your Marketing Budget
(Slide 1 of 2)

• Marketing budgets, especially in small and mid-sized

businesses, are often arbitrarily set as either x% of
planned revenue or y% over the prior year's marketing
budget.
• Use targeted budgeting to more intelligently set your
budget based on company objectives.

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Hamed Ali
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 6. Define Your Marketing Budget
(Slide 2 of 2)

Answer the following questions:

– What previous marketing methods have been most effective?
– What are your costs compared to sales?
– What is your cost per customer?
– What marketing methods will you use to attract new customers?
– What percentage of profits can you allocate to your marketing
campaign?
– What marketing tools (i.e. - newspapers, magazines, Internet,
direct mail, telemarketing, event sponsorships) can you implement
within your budget?
– What methods are you using to test your marketing ideas?
– What methods are you using to measure results of your marketing
campaign?

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Hamed Ali
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 7. Integrate Your Marketing
Communication
• Integrate marketing communication to A
consolidate marketing tools, approaches, COLLABORATIV
and resources within a company to E APPROACH
maximize impact and gain edge over the
competition.
• Build on a "Marketing Mix“ and include the
following:
– 4P’s: Product, Price, Promotion, and Place
– Marketing & Advertising
• Internet
• Events
• Direct
• Database
– Public Relations
36
Hamed Ali
4/1/2024 @[email protected]
 8. Identify Sales Channels
• Part of the challenge of marketing is figuring out which distribution
method to use for your business.
• Include all relevant distribution channels:
– Retail: Stores selling to final consumer buyers (one store, or a chain of
stores).
– Wholesale: An intermediary distribution channel that usually sells to retail
stores.
– Direct mail: Generally catalog merchants that sell directly to consumers.
– Telemarketing: Merchants selling directly to consumer buyers at retail via
phones.
– Cyber-Marketing: Merchants selling directly to consumer buyers at retail
prices, or business-to-business products and services at wholesale prices
via computer networks.
– Sales force: Salaried employees of a company or independent
commissioned representatives who usually sell products for more than one
company.
37 Hamed Ali
4/1/2024 @[email protected]
 9. Track Marketing Activities
• Tracking helps monitor the effectiveness of each marketing activity and is
especially helpful with your overall program evaluation.
• Include procedures for tracking each type of marketing activity you are using.
• Some examples are:
– Display advertising: With traditional consumer publications, tracking can
be done through the use of different phone numbers, special offers
(specific to that advertisement or publication), or reference to a specific
department.
– Internet marketing: Usually, this is easily tracked by monitoring web
traffic.
– Trade shows: A trade show’s effectiveness can be tracked by collecting
the right information at the show and following up on it.
– Database: Before your Marketing Plan is kicked off, make sure you have
the database structure in place to record this information.
• The tabulated results and customer information is very valuable information.
38
Hamed Ali
4/1/2024 @[email protected]
 10. Evaluate Your Progress

• Identify how you will measure your success and in what ways your
objectives have been met. Then, use these metrics to determine the
success of your marketing efforts.
• Answer the following questions:
– Did we reach our goals?
– Was the marketing campaign successful?
– Were we able to determine Return on Investment (ROI)?
– Did our efforts result in conversion? In other words, were we able
to convert an inquirer to a visitor, a visitor to a customer?
– Can we utilize our database to survey, capture additional
information, or establish a more comprehensive customer
relationship program?

4/1/2024 39 Hamed Ali

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 Simple Marketing System
Communication

Goods/services
Industry Market
(a collection (a collection
of sellers) of Buyers)
Money

40
4/1/2024 Information Hamed Ali
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 Marketing = ?

➔ Marketing is the sum of all activities that take you to a sales

outlet. After that sales takes over.
➔ Marketing is all about creating a pull, sales is all about push.
➔ Marketing is all about managing the four P’s –
➔ product
➔ price
➔ place
➔ promotion

41 Hamed Ali
4/1/2024 @[email protected]
 The 4 Ps & 4Cs

Marketing
Mix

Place
Product

Convenience
Customer Price Promotion
Solution

Customer Communication
Cost
42
4/1/2024 Hamed Ali
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 Difference Between - Sales & Marketing ?

Sales
Let the customer want what the company produce.

Marketing
Let the company produce what the customer
wants.

43
4/1/2024 Hamed Ali
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 Scope – What do we market

➔ Goods
➔ Services
➔ Events
➔ Experiences
➔ Personalities
➔ Place
➔ Organizations
➔ Properties
➔ Information
➔ Ideas and concepts

44
4/1/2024 Hamed Ali
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 Core Concepts of Marketing

Based on :-

➔ Needs, Wants, Desires / demand

➔ Products, Utility, Value & Satisfaction
➔ Exchange, Transactions & Relationships
➔ Markets, Marketing & Marketers.

45
4/1/2024 Hamed Ali
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 Core Concepts of Marketing

Needs, wants Utility, Value &

Products
demands Satisfaction

Marketing & Xchange, Transaction

Markets
Marketers Relationships

46 Hamed Ali
4/1/2024 @[email protected]
 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

47 Hamed Ali
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4/1/2024
 In order to understand Marketing let us begin
with the Marketing Triangle

Customers

Company Competition
48 Hamed Ali
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4/1/2024
 Who is a Customer ??

CUSTOMER IS . . . . .

Anyone who is in the market looking at a product /

service for attention, acquisition, use or consumption
that satisfies a want or a need

49 Hamed Ali
4/1/2024 @[email protected]
 Customer –

• CUSTOMER has needs, wants, demands and

desires
• Understanding these needs is starting point of the
entire marketing
• These needs, wants …… arise within a
framework or an ecosystem
• Understanding both the needs and the ecosystem
is the starting point of a long term relationship

50
4/1/2024 Hamed Ali
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 How Do Consumers Choose Among
Products & Services?

• Value - the value or benefits the customers gain from

using the product versus the cost of obtaining the
product.
• Satisfaction - Based on a comparison of performance
and expectations.
– Performance > Expectations => Satisfaction
– Performance < Expectations => Dissatisfaction

51
4/1/2024 Hamed Ali
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 Customers - Problem Solution

• As a priority , we must bring to our customers “WHAT

THEY NEED”
•We must be in a position to UNDERSTAND their problems
•Or in a new situation to give them a chance to AVOID the
problems

52
4/1/2024 Hamed Ali
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 Customer looks for Value

•Value = Benefit / Cost

•Benefit = Functional Benefit + Emotional Benefit
•Cost = Monetary Cost + Time Cost + Energy
Cost + Psychic Cost

53
4/1/2024 Hamed Ali
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 Strategic Marketing

Strategic marketing management is concerned with how

we will create value for the customer.
Asks two main questions

➢ What is the organization’s main activity at a particular time?

– Customer Value
➢ What are its primary goals and how will these be achieved?
– how will this value be delivered

55
4/1/2024 Hamed Ali
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 Strategic Planning

• Strategic Planning is the managerial process of creating

and maintaining a fit between the organization’s objectives
and resources and the evolving market opportunities.

➔ Also called Strategic Management Process

➔ All organizations have this
➔ Can be Formal or Informal

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4/1/2024 Hamed Ali
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 The Strategic-Planning, Implementation,
and Control Process

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4/1/2024 Hamed Ali
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 Business Strategic-Planning Process
External environment
(Opportunity &
Threat analysis)

Business Mission Goal Formulation

Internal Environment

(Strength/ Weakness analysis)

58
4/1/2024 Hamed Ali
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 Strategy Formulation
Environmental Analysis

Competitor Internal Analysis

Customer
Supplier Technology Know-How
Regulatory Manufacturing Know-How
Social/ Political Marketing Know-How
Distribution Know-How
Logistics
Opportunities & Threats

@[email protected]
Strength & Weaknesses

Identity Core Competencies

Identify opportunity

Hamed Ali
Fit internal Competencies with external opportunities

59
4/1/2024
Firm Strategies
 The Marketing Plan

• A written document that acts as a guidebook of

marketing activities for the marketing manager

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4/1/2024 Hamed Ali
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 CONTENTS of MARKETING PLAN

Business Mission Statement

Objectives
Situation Analysis (SWOT)
Marketing Strategy
➢ Target Market Strategy
➢ Marketing Mix
➔ Positioning
➔ Product
➔ Promotion
➔ Price
➔ Place – Distribution
➔ People
➔ Process
Implementation, Evaluation and Control
61
Hamed Ali
4/1/2024
@[email protected]
 The Marketing Process
Business
Mission
Statemen
t

Objective
s

Situation
or SWOT
Analysis

Marketing Strategy
Target Market

@[email protected]
Strategy

Marketing Mix
Place/Distribution

Hamed Ali
Product

Promotion Price

Implementation
62
4/1/2024 Evaluation, Control
 Factors
Influencing
Company’s
Marketing
Strategy

63
4/1/2024
Hamed Ali
@[email protected]
 External Marketing Environment

External Environment
Social Ever-Changing
is not controllable Change Marketplace
Demographics

Economic
Product Physical / Natural Conditions
Distribution
Promotion
Price
Competition
Target Market
Political &
Legal Factors
Technology
Environmental
Scanning

64
4/1/2024 Hamed Ali
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The macro-environment

is the assessment of the external forces that act upon the

firm and its customers, that create threats & opportunities

65
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Product is . . . . .

Anything that is offered to the market for

attention, acquisition, use or consumption that
satisfies a want or a need

66
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 Types of Products

PRODUCTS

Consumer Industrial
Services
Products Products

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 Product Items, Lines, and Mixes

A specific version of a product

Product Item that can be designated as a
distinct offering among an organization’s products.

A group of closely-related
Product Line
product items.

All products that an

Product Mix
organization sells.

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 Product Mix

•Width – how many product lines a company has

•Length – how many products are there in a product
line
•Depth – how many variants of each product exist
within a product line
•Consistency – how closely related the product
lines are in end use

69
4/1/2024 Hamed Ali
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What is a Service? Defining the Essence

•An act or performance offered by one party to another

(performances are intangible, but may involve use of physical
products)

•An economic activity that does not result in ownership

•A process that creates benefits by facilitating a desired

change in customers themselves, or their physical
possessions, or intangible assets

70
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 Some Industries - Service Sector

• Banking, stock broking • Health care

• Lodging • Education

• Restaurants, bars, • Wholesaling and

retailing
catering
• Laundries, dry-cleaning
• Insurance
• Repair and maintenance
• News and entertainment • Professional (e.g., law,
architecture, consulting)
• Transportation (freight
and passenger)

71
4/1/2024 Hamed Ali
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 Classification of Services
Pure Intangible
Banking
Service

Good Transportation

Major Service with

Minor Product
Business Hotels
Product = Service

Computers

Major Product with

Minor Services
Materials / Components

Pure Tangible Product

72 Hamed Ali
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4/1/2024
 Major Characteristic of Services

➔ Intangibility – Services are intangibility cannot be seen,

tasted, felt, heard or smelled before purchase.
➔ Inseparability - Services are produced and consumed
simultaneously.
➔ Variability or Heterogeneity – Services are highly variable
➔ Perishability – Services cannot be stored.
➔ Non Ownership - Services are rendered but there is no
transfer of title

73
4/1/2024 Hamed Ali
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 The Marketing Mix

• The conventional view of the marketing mix

consisted of four components (4 Ps): Product,
Price, Place/ distribution and Promotion.
• Generally acknowledged that this is too narrow
today; now includes , Processes, Productivity
[technology ]People [employees], Physical
evidence
• Marketers today are focused on virtually all
aspects of the firm’s operations that have the
potential to affect the relationship with customers.
74 Hamed Ali
4/1/2024 @[email protected]
 The “8Ps” of Integrated Service
Management vs. the Traditional “4Ps”

► Product elements
► Place, cyberspace, and time
► Process
► Productivity and quality
► People
► Promotion and education
► Physical evidence
► Price and other user outlays
75
 The Give and Get of Marketing

76
Hamed Ali
4/1/2024 @[email protected]
 Great Words on Marketing

1. “The purpose of a company is ‘to create a

customer…The only profit center is the customer.’”
2. “A business has two—and only two—basic functions:
marketing and innovation. Marketing and innovation
produce results: all the rest are costs.”
3. “The aim of marketing is to make selling
unnecessary.”
4. “While great devices are invented in the Laboratory,
great products are invented in the Marketing
department.”
5. “Marketing is too important to be left to the marketing
77 department.” Hamed Ali
4/1/2024 @[email protected]
 Drivers of Customer Satisfaction

• Many aspects of the firm’s value proposition contribute to

customer satisfaction:
– The core product or service offered
– Support services and systems
– The technical performance of the firm
– Interaction with the firm and it employees
– The emotional connection with customers
• Ability to add value and to differentiate as a firm focuses
more on the top levels

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4/1/2024 Hamed Ali
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 Marketers and Markets

• Marketers are focused on stimulating exchanges

with customers who make up markets – B2C or
B2B.
• The market is comprised of people who play a
series of roles: decision makers, consumers,
purchasers, and influencers.
• It is absolutely essential that marketers have a
detailed understanding of consumers, their
needs and wants.
• Much happens before and after the sale to affect
customer satisfaction

79
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 Stages of Customer Interaction

80 Hamed Ali
4/1/2024 @[email protected]
 What Changed in Marketing…

Old Economy New Economy

• Organize by product units • Organize by customer segments

• Focus on profitable transactions • Focus on customer lifetime value
• Look primarily at financial • Look also at marketing scorecard
scorecard
• Focus on shareholders
• Focus on stakeholders
• Marketing does the marketing
• Build brands through advertising • Everyone does the marketing
• Focus on customer acquisition • Build brands through performance
• No customer satisfaction • Focus on customer retention
measurement • Measure customer satisfaction and
• Over-promise, under-deliver retention rate
• Under-promise, over-deliver

81
4/1/2024 Hamed Ali
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Three Marketing Philosophies

1. Production Philosophy

2. Selling Philosophy

3. Marketing Philosophy
 The Marketing Concept

• The purpose of an organization is to satisfy

customer needs.

• Satisfying needs requires integrated and

coordinated efforts through out the organization.

• Organizations should focus on long-term success.

4/1/2024 Hamed Ali

@[email protected] 1-83
 Three Ways to Increase Customer Equity

1. Decrease the cost of acquiring new customers.

2. Retain more customers longer.

3. Increase profits from retained customers by selling them

more at higher margins and with lower marketing
expenses.

4/1/2024 Hamed Ali

@[email protected] 1-84
 Building Customer Equity Integrates:

Short-term New
Orientations Customers

Long-term Existing
Orientations Customers

4/1/2024 Hamed Ali

@[email protected] 1-85
 3 Keys to Building Customer Equity

1. High loyalty levels lead to increased sales growth, higher

profitability & higher customer equity.

2. Completely delighted & satisfied customers are best for

earning customer loyalty.

3. Exceptional value is needed to delight & completely satisfy

customers.

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Marketing as a Societal Process

• Defined as “a process that facilitates the

flow of goods and services from
producers to consumers in a society.”

Producers of Consumers of
Goods & Services Goods & Services

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 Marketing is a Process
Consisting Of:

Marketing Exchanges
Marketing Strategies
Marketing Activities
Marketing Positions
Marketing Institutions

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@[email protected] 1-88
 Marketing Exchanges
• EXCHANGE is the • Transactions in
“transfer of marketing exchanges
something tangible can use:
or intangible, actual • Money
or symbolic between • Barter
• Time & Money
2 or more social
• Votes
actors.”
Marketer’s Goods Buyer’s
Or Services Exchange

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@[email protected] 1-89
 Marketing Strategies

Select a Develop a
Target Market Marketing Mix

To Satisfy
Market Needs

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@[email protected] 1-90
 Marketing Mix Decisions

Product Decisions

Integrated Marketing Marketing Price Decisions

Communications Decisions Mix

Distribution Decisions

4/1/2024 Hamed Ali

@[email protected] 1-91
 Marketing Activities
Buying

Selling

Transporting

Storing
Producers End Users
Financing

Risk Taking

Standardizing &
Grading

Obtaining Marketing
Hamed Ali
Information @[email protected]
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 Marketing Positions
• Marketing Manager
• Product Manager
• Advertising Manager
• Distribution Manager
• Purchasing Manager
• Marketing Research Manager
• Public Relations Manager
• Customer Service Manager
• Sales Manager
A Contemporary Marketing Framework

Marketing
Environment

Entrepreneurship

@[email protected]
Global
Ethics
Marketing
Productivity Customer

Hamed Ali
Value
Relationship
Technology

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 Strategic Planning

• Strategic planning is defined as:

– “The process of developing and
maintaining a strategic fit between the
organization’s goals and capabilities and
its changing marketing opportunities.”

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 Steps in the
Strategic Planning Process

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 Strategic Planning

• Mission statements should . . .

– serve as a guide for what the organization
wants to accomplish.
– be “market-oriented” rather than “product-
oriented”.
– be neither too narrow, nor too broad.
– fit with the market environment.
– be motivating.

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 Strategic Planning

• Mission statements guide the

development of objectives and goals.
– Objectives are developed at each level in
the organization hierarchy.
– Strategies are developed to accomplish
these objectives.

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 Strategic Planning

• Identify strategic
Portfolio Design business units (SBUs)
• Assess each SBU:
• Step 1:
– The BCG growth-share
Analyze the matrix classifies SBUs
current business into one of four
portfolio categories using:
• Step 2: • Market growth rate
• The SBU’s relative
Shape the future market share within
business portfolio the market.
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Growth-Share Matrix

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 Strategic Planning

• Determine the future

Portfolio Design role of each SBU and
choose the appropriate
• Step 1: resource allocation
Analyze the strategy:
current business – Build
portfolio – Hold
• Step 2: – Harvest
– Divest
Shape the future
business portfolio • SBUs change positions
over time
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 Strategic Planning

• Matrix approaches to formal planning share

many problems:
– Difficult, time-consuming, and costly to
implement.
– Focus only on current businesses.
– Too strongly emphasize market share growth or
growth via diversification.

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 Strategic Planning

• Designing the business portfolio also

involves:
– Developing strategies for growth by
identifying, evaluating, and selecting
promising new market opportunities.
– Developing strategies for downsizing
the business portfolio.

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Product / Market
Expansion Grid

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The Marketing Process

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 The Marketing Process

• The strategic planning

Key Elements and business portfolio
analysis processes help
Analyzing marketing to identify and evaluate
opportunities marketing opportunities.
Selecting target • The purpose of the
markets marketing process is to
Developing the help the firm plan how to
marketing mix capitalize on these
opportunities.
Managing the
marketing effort
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 The Marketing Process

• The segmentation
Key Elements process divides the
total market into
Analyzing marketing market segments.
opportunities • Target marketing
Selecting target chooses which
markets segment(s) are
Developing the pursued.
marketing mix
• Market positioning for
Managing the the product is then
marketing effort determined.
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 The Marketing Process

• Competitor analysis
Key Elements guides competitive
marketing strategy
development.
Analyzing marketing • Strategy leads to tactics
opportunities via the marketing mix:
Selecting target – The “Four Ps” – product,
markets price, place, promotion
(seller viewpoint)
Developing the – The “Four Cs” – customer
marketing mix solution, cost,
convenience, and
Managing the communication (customer
marketing effort viewpoint)
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The Marketing Mix

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 The Marketing Process

• Marketing analysis
Key Elements – Provides information
helpful in planning,
implementation, and
Analyzing marketing control
opportunities • Marketing planning
Selecting target – Strategies and tactics
markets • Marketing implementation
– Turns plans into action
Developing the
marketing mix • Marketing control
– Operating control
Managing the – Strategic control
marketing effort
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 Managing the
Marketing Effort

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 Marketing Planning Defined

Marketing Planning is a systematic,

structured process. It includes:
1. Researching and analyzing the current
situation.
2. Developing and documenting the firm’s
objectives, strategies and programs,
3. Implementing, evaluating and controlling
marketing activities.

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@[email protected] 1-21-112
 The Marketing Planning Process

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 Market share Equations

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 Market share Equations

Hamed Ali
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 Market share Equations

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 Market share Equations

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Step 1: Research and Analyze the
Current Situation
The marketer performs both:
1. External analysis, and
2. Internal analysis

4/1/2024 Hamed Ali

@[email protected] 1-51-118
 External Analysis

External analysis involves the

understanding of trends that may impact
marketing strategy:
• Demographic
• Economic
• Technological
• Political-Legal
• Ecological
• Social-Cultural
4/1/2024 Hamed Ali
@[email protected] 1-61-119
 Internal Analysis

Marketers also assess the firm’s

capabilities and the strategies of
competitors in order to:
• Build on strengths
• Exploit competitors’ weaknesses

4/1/2024 Hamed Ali

@[email protected] 1-71-120
 Other Analyses

Other areas that are analyzed for their

impact on marketing strategy include:
• Customers
• Suppliers
• Distributors
• Partners, and
• Other Stakeholders

4/1/2024 Hamed Ali

@[email protected] 1-81-121
Step 2: Understand Markets and
Customers
• Can be consumers or businesses
• A comprehensive understanding of the
customer is desired:
– Buying habits, needs, wants, attitudes and
behaviors.
– Who?, What?, Where?, When?, Why?,
How?
– Are buying patterns changing? Why?

4/1/2024 Hamed Ali

@[email protected] 1-91-122
 Step 3: Segmentation, Targeting
and Positioning
• The purpose of segmentation: To group customers
with similar needs, wants, behavior or attitudes.
• Targeting: The selection of specific segments for
marketing. Can be to one segment, multiple
segments, or the entire market.
• Positioning: Using marketing to create a
competitively distinctive place (position) for the brand
or product in the mind of the targeted customers.

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Step 4: Plan Direction, Objectives,
and Marketing Support
• Goals: Long-term performance targets.
• Objectives: Shorter-term targets that
support the achievement of goals.
• Sustainable Marketing:
– Balancing long-term goals with short-term
objectives and budget realities.
– Balancing goals and objectives with an eye
toward being responsible to the larger
society.
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 Six Approaches to Growth

Based upon permutations of markets and products.

CURRENT MODIFIED INNOVATED

Market Penetration Product Development

EXISTING

EXPANDED
(Geographic)

ENTIRELY NEW
Market Development Diversification

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@[email protected] 1-12
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Step 5: Develop Marketing
Strategies and Programs
• Utilizing the tools of the “marketing mix”.
• Consistent with the firm’s overall
direction, goals and strategies.
• Includes the development of strategic
alliances.

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 Alliance Provides Value

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 Primary Marketing Tools

The primary tools for marketing, referred

to as the “Marketing Mix” are:
• Product
• Price
• Promotion, and
• Channels

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 The Marketing Mix

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 Product

• Tangible good or an intangible service.

• Must be considered in a holistic fashion.
• Branding must also be considered.

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 Pricing

Based upon a number of factors:

• How customers perceive the value of the
offering.
• Positioning.
• Product costs.
• Competitive forces.
• Objectives of the organization.

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 Channel

• How, when and where to make the goods

and services available to customers.
• Requires effective relationships with
channel partners.

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 Promotion

Involves the following activities:

• Advertising
• Public Relations
• Sales Promotion
• Personal Selling
• Direct Marketing
• Use of the Internet

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Step 6: Track Progress, Implement
and Control
• Mechanisms and methods of
measuring progress toward goals:
– Sales forecasts
– Budgets
– Schedules
• Comparing actuals vs. projections or
the plan.
• Making changes as needed.
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 Preparing for Marketing Planning

Marketers must develop a number of

professional and organizational
strengths, including:
• Knowledge of markets and customers,
• Core competencies, and
• Strategic relationships

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 Support Strategies: Customer Service

Customer Service:
• Reinforces positive perceptions.
• Enhances business through reputation
and referral.
• Helps differentiate from competitors.
• Poor service alienates otherwise loyal
customers.

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 Support Strategies: Internal Marketing

Internal Marketing:
• Focuses all employees on serving
customers.
• Builds support for the marketing plan.
• Enhances execution of the marketing
plan throughout the organization.

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 5 Guiding Principles for Effective
Marketing Planning
1. Expect Change
2. Emphasize Relationships
3. Involve Everyone
4. Seek Alliances
5. Innovate to Provide Value

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 Environmental Scanning and Analysis

Involves the analysis of both:

• Internal Factors, and
• External Factors

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@[email protected] 2-21-139
 Internal Factors

• Mission
• Resources
• Offerings
• Previous Results
• Business Relationships
• Keys to Success and Warning Signs

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@[email protected] 2-31-140
 External Factors

• Demographics
• Ecological
• Economic
• Technology-related
• Political-Legal
• Social-Cultural
• Competitors

4/1/2024 Hamed Ali

@[email protected] 2-41-141
 Internal Analysis: Mission

Mission:
• States the firm’s fundamental purpose.
• Indicates how the firm will add value.

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@[email protected] 2-51-142
 Internal Analysis: Resources

• Human
• Financials
• Informational
• Supply

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@[email protected] 2-61-143
 Internal Analysis: Offerings

Examining what the firm is currently

offering in the way of goods and
services:
• Fit with mission and resources.
• Affirm role of each line and item.

4/1/2024 Hamed Ali

@[email protected] 2-71-144
 Internal Analysis: Previous Results

• Results include:
– Sales (dollars and units).
– Profitability.
– Customer acquisition and retention costs.
– Other financial results.
• Provide clues to firm’s strengths and
weaknesses.
• Helps separate the effective programs
from the less-effective programs.

4/1/2024 Hamed Ali

@[email protected] 2-81-145
 Internal Analysis: Business Relationships

Includes relationships with:

• Suppliers
• Distributors
• Other business partners
Examine:
• Capacity
• Quality
• Value provided

4/1/2024 Hamed Ali

@[email protected] 2-91-146
 Internal Analysis: Keys to Success
and Warning Signs

Keys to Success:
– Identify special factors most crucial to
success.
– Maintain focus on key priorities.
Warning Signs
– Indicate potential problems with the plan.

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@[email protected] 2-10
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 External Analysis: Demographic Trends

Examined by target market:

– Consumer Demographics
– Business Demographics

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 External Analysis: Consumer
Demographic Trends
Key consumer demographic trends include:
• Population growth
• Population composition:
– Age
– Gender
– Ethnicity
– Religious makeup
– Education
– Occupation
– Household size
– Income

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 External Analysis: Business
Demographic Trends

• Size and growth of industries

– Number of companies.
– Number of locations or branches.
– Number of employees.
– Sales revenues.
• Trends in new business formation may
signal emerging opportunities.

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 External Analysis: Economic Trends

• Must keep an eye on global, national,

regional and local economic trends.
• Some measures typically monitored:
– Buying power
– Income
– Debt
– Credit Usage

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@[email protected] 2-14
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 External Analysis: Ecological Trends

Potential impacts:
– Availability of raw materials.
– Government regulations.
– Social attitudes.

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@[email protected] 2-15
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 External Analysis: Technological Trends

Key trends include:

• Cell phones
• Computers
• Digital media
• Internet access
• Increasing bandwidth

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 External Analysis: Political-Legal Trends

Legal Trends: Laws includes

international, federal, state and local.
Related to:
• Competitive behavior
• Pricing
• Taxation
• Promotion
• Distribution
• Product liability
• Labeling
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 External Analysis: Political-Legal Trends

Political Trends
• Global. national, or local
• Can signal a change in the legal
environment.

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 External Analysis: Social-Cultural Trends

• Key trend: Increasing diversity in

markets.
• Keep tabs on popular culture.
– Tends to be volatile.
• Core beliefs and values change more
slowly over time.

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 External Analysis: Competitors

• Identify:
– Current competitors.
– Possible future competitors.
• Learn about the unique competitive
advantages of each competitor.
• Track trends in market share.

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 Porter’s Five Forces Model

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 Three Fundamental Business Strategies

• Cost Leadership Strategy

• Differentiation Strategy
• Focus Strategy

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 SWOT Analysis

• Strengths
• Weaknesses
• Opportunities
• Threats

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 SWOT Analysis (cont’d)

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 Exhibit 2.5
Judging Organizational Strengths & Weaknesses

Past Performance Trends Comparison vs. Competitors

Are organizational
resources & capabilities
strengths or weaknesses?

Specific Goals or Targets Personal Opinions of

Strategic Decision Makers

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 What is a Market?

• Market = All the potential buyers for a

particular product or service.
• Markets can be defined by:
– Product
– Customer definition
– Geography

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@[email protected] 3-21-163
 Markets Must Be Analyzed

• Markets are always changing

• Market analysis is performed to better
understand:
– Requirements
– Behaviors, and
– Attitudes

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@[email protected] 3-31-164
 Market Share

• Market share : The percentage of total

sales (dollars or units) held by a particular
company, brand or product.
• Directly affects segmentation and
marketing.
• Serves as a baseline for understanding
historical market dynamics.

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@[email protected] 3-41-165
 5 Basic Levels of Market Definition
Level Definition
Potential Market All customers who may be interested
in a particular offering.
Available Market Customers who are interested,
possess sufficient income, and have
access to the offering.
Qualified Available Customers who are qualified to buy
Market based on age or other criteria.

Target Market Customers that the company intends

to target.
Penetrated Market Customers who are already buying the
product.
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 Analyzing Customer Needs and Behavior

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 Analyzing Consumer Markets

Information needs include:

• Who?
• What?
• Where?
• When?
• Why?
• How?

4/1/2024 Hamed Ali

@[email protected] 3-81-168
 Considerations for the Consumer Market

• Cultural
• Social
• Personal

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@[email protected] 3-91-169
 Consumer Market: Cultural
Considerations
• Different cultures means different approaches
to buying situations, due to differing values,
beliefs and preferences.
• Subcultures: Groups within a larger culture
that preserve distinct cultural identity:
– Religion
– Ethnic background
– Lifestyle
• Class: Levels of socioeconomic status.
– Persons of same class exhibit similar behaviors

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 Consumer Market: Social
Considerations
• Social influences on behavior include:
– Family members
– Friends
– Work Groups
– Civic Organizations
• Within social groups, consumers are
influenced by opinion leaders, who
provide advice and guidance.

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 Consumer Market: Personal
Considerations
• Personal factors include:
– Family life cycle
– Lifestyle
– Psychological makeup
• Psychographic characteristics
include:
– Motivations
– Perceptions
– Attitudes
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 Considerations for the Business
Market
Special considerations for businesses
include:
• Organizational Connections
– Internal players
– Suppliers
• Organizational Considerations
– Company characteristics
– Derived demand

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 Organizational Connections:
Internal Players
Also to consider:
• Those who initiate the decision
• Those who use the products/services
• Those who evaluate the alternatives
• Those who approve the release of
funds

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 Organizational Connections:
Suppliers
Current relations with competing
suppliers should be considered:
• Long-term contracts
• Evaluations
• Requirements
• Other elements

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 Organizational Considerations:
Company Characteristics
Company characteristics include:
• Company’s size and industry
• Current market share and growth
• Competitive situation
• Buying policies and procedures
• Financial constraints
• Timing of the purchases

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 Organizational Considerations:
Derived Demand
Derived demand: The principle that
demand for business products is based
upon (derived) demand for related
consumer products.
Derived demand requires that B2B
marketers be aware of emerging trends
and needs in consumer markets and be
ready to help their business customers
serve their consumer customers.
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 Planning Marketing Research

Two basic types of research:

• Secondary Research:
– Information already collected for another
purpose.
– More readily available and less expensive
than primary research.
• Primary Research:
– Research conducted to address a specific
situation

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 Secondary Research: Some
Cautions
Some cautions for using secondary research:
• Before using, check dates and sources.
• Consider the source’s credibility
– Reputable?
– Unbiased?
• Look into the sources cited by your secondary
source
• Be careful about applying general learning to
your specific situation.

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 Primary Research

• Problem Definition
– What information is needed?
– How will it be used?
• Data Collection
– Methods include:
• Observation
• Surveys
• Experiments

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 Primary Research Techniques:
Focus Groups
• Small group of customers/prospects
• Guided discussion
• Yields insights into customer
thinking, attitudes and behaviors
• Drawback: May not be representative
of the entire market.

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 Primary Research Techniques:
Ethnographic Research
• Ethnographic Research: Observing how
customers behave in actual product
purchase or usage situations, and
asking to clarify the reasons for
behavior.
• Helps marketers to:
– Develop new product ideas.
– Fine-tune personal selling approaches.
– Plan for other marketing attention.
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 Using Marketing Research

• If research is needed, include this as a

budget item in your marketing plan.
• Plan for ongoing market research to help
measure results during implementation.
• Good decision making involves weighing the
pros and cons of making a decision based
on limited data, or waiting for research.
• Be respectful of consumer privacy concerns.

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Fragmentation and Intense Competition

• Customers exhibiting a wider variety

of:
– Needs
– Attitudes, and
– Behaviors
• Companies must differentiate
themselves more distinctly in the
markets where they compete.

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 The Need for Segmentation,
Targeting and Positioning

• A move away from mass marketing.

• A move towards segment marketing.
• Allows marketers to focus their
resources on the most promising
opportunities.
• Improves marketing efficiency and
effectiveness

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 Market Segmentation

• Definition: the process of grouping

customers within a market according to
similar needs, habits or attitudes that can be
addressed through marketing.
• Even within a large segment, marketers
often can identify niches.

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 Steps in the Segmentation Process

1. Select the general market:

– Eliminate markets that have no need for the
product or are inappropriate for other reasons.
2. Apply segmentation variables.
3. Assess and select segments for
targeting

4/1/2024 Hamed Ali

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 Overview of Segmentation,
Targeting and Positioning

4/1/2024
Hamed Ali
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 Consumer Segmentation Variables
Type of Variable Examples
Behavioral and Benefits sought, rate of usage,
Attitudinal attitude toward product and usage,
price sensitivity.

Demographic Age, gender, family status,

household size, income, occupation,
education.

Geographic Location, distance, climate.

Psychographic Lifestyle, activities, interests.

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Segmenting by Behaviors and Attitudes

In many ways, the best way to segment:

• Help marketers analyze the specific value
that a particular group expects from the
offering.
• Include variables like:
• Benefits required or expected
• Usage occasion and status
• Loyalty status
• Technological orientation
• Attitudes toward products or usage

4/1/2024 Hamed Ali

@[email protected] 4-71-190
 Segmenting by Demographics

• Popular for segmentation because they are

common and easily identified consumer
characteristics.
• Often point to meaningful differences in:
– Consumer needs and wants.
– Product consumption.
– Media usage.
• However, care must be taken to avoid over-
generalization or stereotyping.
4/1/2024 Hamed Ali
@[email protected] 4-91-191
 Segmenting by Geographics

May be based on:

• A company’s ability to sell and service
products in certain areas or climates,
• Its interest in entering promising new
markets, or
• Its reluctance to sell in certain areas due
to environmental threats or unfavorable
climate.

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 Segmenting by Psychographics

• Includes such variables as lifestyles,

activities, interests and attitudes.
• Provides a deeper understanding of what
and why consumers buy.
• When consumer activities or interests cross
demographic and/or geographic lines.

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 Business Segmentation Variables
Type of Variable Examples

Behavioral and Purchasing patterns and process,

Attitudinal user status, benefits expected, order
size/frequency, buyer/influencer/user
attitudes.

Demographic Industry, business size, business

age, ownership structure.

Geographic Location, distance, climate.

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Segmenting by Behaviors and Attitudes

• Helps marketers identify what specific business

segments want and value, as well as how/why
they buy.
• Includes variables such as:
– Purchasing patterns
– User status
– Attitude toward technology
– Loyalty status
– Price sensitivity
– Order size/frequency
– Attitudes
– Benefits expected

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 Segmenting by Demographics

Common business demographic variables

used:
• Industry
• Business size
• Business age
• Ownership structure

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 Segmenting by Geographics

• Utilizes such variables as nation, region,

state, city and climate.
• Allows for the grouping of potential
customers according to:
– Concentration of outlets
– Location of headquarters
– Geography-related needs or responses

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 Assessing Potential Target Markets

• Target Market: The segment of the overall

market that a company chooses to pursue.
• Each potential segment must be
evaluated based upon fit with the firm’s:
– Resources
– Core competencies
– Goals and objectives
– Offerings

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Assessing Segment Attractiveness

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 Ranking and Choosing Among
Potential Segments
Here is an approach sometimes taken:-

1. Take all potential targets.

2. Rate each potential target across a number of
selected criteria. Develop “importance”
weights for each of the criteria.
3. Develop a composite score for each segment.

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 Sample Segment Ranking

Fit with
Growth Competitive Company Overall
Segment Potential Superiority Resources Score

A 3 5 2 10
B 5 4 4 13
C 4 2 3 9

Scoring key: 5 = highly attractive, 4= moderately attractive, 3 =

average, 2 = moderately unattractive, 1 = highly unattractive

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 Coverage Strategies

• Concentrated Marketing
– Concentrating the marketing efforts on only one
key segment.
• Undifferentiated Marketing
– Targeting all segments with the same marketing
strategy.
• Differentiated Marketing
– Creating a separate marketing strategy for
each segment.
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 Personas

• Growing number of companies are

gaining insights by developing personas:
– Detailed but fictitious profiles representing how
individual customers in their targeted segments
behave, live and buy.
• Give marketers a deeper understanding
of what shapes each segment’s needs,
preferences, buying behavior and
consumption patterns.
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 Positioning

• Positioning is the differentiation of the brand

or product on the basis of attributes that
customers find meaningful.
• Positioning conveys the value that the
brand provides and sets the brand apart.
• Sets the tone for the marketing plan.
• Should be re-evaluated periodically.

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 Meaningful Differentiation

• Some sources of meaningful differentiation:

– Product features
– Service attributes
– Channel attributes
– Pricing attributes
– Other attributes
• Consideration is also given to positions
being staked out by the competition.

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 Direct Marketing

• Direct marketing:
– Connecting directly with carefully targeted
individual consumers to both obtain an
immediate response and cultivate lasting
customer relationships.

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 The New Direct-Marketing Model

• The new direct-marketing model:

– Direct marketing has undergone a dramatic
transformation.
– Most firms use direct marketing as a
supplemental channel or medium.
– For many companies, direct marketing
constitutes a new and complete model for
doing business.
– Some firms employ the direct model as their
only approach (e.g., Geico, Amazon, eBay).
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 Benefits of Direct Marketing

• Benefits to buyers:
– Convenient.
– Easy to use.
– Private.
– Ready access to products.
– Ready access to wealth of comparative
information.
– Immediate and interactive.

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 Benefits of Direct Marketing

• Benefits to sellers:-
– Powerful tool for building customer relationships.
– Offers a low-cost, speedy way to reach markets,
including business markets.
– Offers lower costs, improved efficiencies, and
speedier handling of channel and logistics
functions.
– Offers greater flexibility.
– Gives access to buyers that could not be
reached through other channels.

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 Customer Databases and
Direct Marketing

• Customer database:
– An organized collection of comprehensive data
about individual customers or prospects,
including geographic, demographic,
psychographic, and behavioral data.

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 Forms of Direct Marketing

• Major forms of direct marketing:-

– Face-to-face selling.
– Direct-mail marketing.
– Catalog marketing.
– Telemarketing.
– Direct-response TV marketing.
– Kiosk marketing.
– New digital technologies.
– Online marketing.

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 Forms of Direct Marketing

• Direct-mail marketing:
– Involves sending an offer, announcement,
reminder, or other item to a person at a
particular physical or virtual address.
– Largest direct marketing medium.
– Well-suited to one-to-one communication.
– Use of traditional forms may decline as
marketers switch to newer digital forms.
– Can be used effectively in combination with
other media, such as Web sites.
– Often perceived as “junk mail.”
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 Forms of Direct Marketing

• Catalog marketing:
– Direct marketing through print, video, or digital
catalogs that are mailed to select customers,
made available in stores, or presented online.
• Catalog marketing trends:
– More and more catalogs are going digital:
• Minimizes costs, and web space is unlimited.
• Allows real-time merchandising.
– Print catalogs are still the primary medium:
• Drives web traffic and can create an emotional
connection to the consumer.

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 Forms of Direct Marketing

• Telephone marketing:
– Accounts for 17% of all direct-marketing
driven sales.
– Used in both consumer and B2B markets.
– Marketers use outbound and inbound calls.
• Outbound: Sell directly to consumer.
• Inbound: Toll-free ordering or order faxing.
– Do-not-call legislation has impacted
the telemarketing industry.
• Many telemarketers have shifted to other forms of
direct marketing.
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 Forms of Direct Marketing

• Direct-response TV marketing:
– Direct-response television advertising (DRTV):
• TV spots that are 60 or 120 seconds long.
– Infomercials:
• A 30-minute or longer advertising program for a
single product.
• Home shopping channels:
– Entire cable channels dedicated to selling
multiple brands, items, and services.

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 Forms of Direct Marketing

• Kiosk marketing:
– Information and ordering machines generally
found in stores, airports, and other locations.
– E.g., in-store Kodak kiosks allow customers to
transfer pictures from digital storage devices,
edit them, and produce high-quality color
prints.

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 Forms of Direct Marketing

• New digital direct marketing technologies:

– Mobile phone marketing:
• Mobile ad spending is expected to grow.
– Podcasts and vodcasts.
– Interactive TV (ITV):
• Viewer engagement is much higher than with
regular TV ads.
• Online marketing is the final form of direct
marketing.

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 Online Marketing

• Online marketing:
– Company efforts to market products and services
and build customer relationships over the
Internet.
• Marketing and the Internet:
– Usage continues to grow with Internet household
penetration equaling 72.5%.
– 33% of American consumers chose the Internet
as the second-most-essential medium in their
lives.
– Online marketing efforts are expanding.

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 Online Marketing

• Click-only companies:
– So-called dot-coms, which operate only online
without any brick-and-mortar presence.
• Types of click-only firms:
– E-tailers (Amazon).
– Search engines and portals (Google).
– Transaction sites (eBay).
– Content sites (ESPN).

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 Online Marketing

• Click-and-mortar companies:
– Traditional brick-and-mortar companies that
have added online marketing to their
operations.
• Trends:
– Almost all traditional companies have set up
their own online sales and communication
presence.
– Many click-and-mortar firms are having more
online success than their click-only competitors.

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 Online Marketing

• Online marketing domains:-

– Business-to-consumer (B2C).
– Business-to-business (B2B).
– Consumer-to-consumer (C2C).
– Consumer-to-business (C2B).

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 Online Marketing

• Business-to-consumer (B2C) online

marketing:
– Businesses selling goods and services online
to final consumers.
• Trends:
– Online buying continues to grow.
– The Internet influences 35% of total retail
sales; 50% of U.S. households shop online.
– B2C consumers differ from off-line consumers
because customers initiate and control the
Internet exchange process.
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 Online Marketing

• Business-to-business (B2B) online

marketing:
– Businesses using B2B Web sites, e-mail, online
catalogs, online trading networks, and other
online resources to reach new business
customers, serve current customers more
effectively, and obtain buying efficiencies and
better prices.
– Most major B2B marketers offer online product
information, purchasing, and support.
– Many firms use the Internet to build stronger
customer relationships.
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 Online Marketing

• Consumer-to-consumer (C2C) online

marketing:
– Online exchanges of goods and information
between final consumers.
– Auction sites such as eBay offer marketplaces
to buy or exchange goods.
– Blogs and forums facilitate information
interchanges.
• Marketers are tapping into blogs as a medium for
reaching carefully targeted consumers.
• Firms should monitor blogs for what is being said.
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 Online Marketing

• Consumer-to-business (C2B) online

marketing:
– Online exchanges in which consumers search
out sellers, learn about their offers, and initiate
purchases, sometimes even driving transaction
terms.
– E.g., GetSatisfaction.com allows users to post
questions, voice complaints, or deliver
compliments to companies.

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 Online Marketing

• Conducting online marketing:

– Creating a Web site.
– Placing ads and promotions online.
– Creating or participating in online social
networks.
– Using e-mail.

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 Online Marketing

• Corporate Web • Marketing Web

sites: sites:
– Designed to build – A Web site that
customer goodwill, engages consumers
collect customer in interactions that
feedback, and move them closer to
supplement other a direct purchase or
sales channels, other marketing
rather than to sell outcome.
the company’s
products directly.
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 Online Marketing

• Online marketers should pay careful attention

to the seven Cs of effective Web site design:
– Context.
– Content.
– Community.
– Customization.
– Communication.
– Connection.
– Commerce.
• Constant change helps encourage repeat visits.
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 Online Marketing

• Placing ads and promotions online:

– Online advertising has become a major
medium.
– Forms of online advertising:
• Banner ads.
• Interstitials.
• Pop-up or pop-under ads.
• Rich media ads.
• Search-related ads (contextual advertising).

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 Online Marketing

• Placing ads and promotions online:

– Other forms of online promotion:
• Content sponsorships (sponsoring special
content).
• Alliances and affiliate programs (work with
firms to promote each other).
• Viral marketing (Internet version of word-of-
mouth).

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 Online Marketing

• Creating or participating in online social

networks:
– Also called web communities.
• E.g., MySpace, Facebook, YouTube.
– Marketers can participate in existing online
communities or set-up their own.
– More focused niche social networks are
emerging which can be used to target special
interest groups.

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 Marketing
Plan
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 Market Summary

• Market: Past, present, and future

– Review changes in market share, leadership,
players, market shifts, costs, pricing, and
competition

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 Product Definition

• Describe the product or service being

marketed

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 Competition

• The competitive landscape

– Provide an overview of product competitors,
and their strengths and weaknesses
– Position each competitor’s product against
the new product

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 Positioning

Positioning of product or service

Statement that distinctly defines the product
in its market and against its competition over
time
Consumer promise
 Statement summarizing the benefit of the
product or service to the consumer

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 Communication Strategies

• Messaging by audience
• Target consumer demographics

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 Packaging and Fulfillment

Product packaging
Discuss form factor, pricing, look, and strategy
Discuss fulfillment issues for items not shipped
directly with the product
COGs
 Summarize cost of goods and high-level bill of
materials

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 Launch Strategies

Launch plan
If product is being announced
Promotion budget
Supply backup material with detailed
budget information for review

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 Public Relations

• Strategy and execution

– PR strategies
– PR plan highlights
– Have backup PR plan including editorial
calendars, speaking engagements, conference
schedules, etc.

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 Advertising

• Strategy and execution

– Overview of strategy
– Overview of media and timing
– Overview of ad spending

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 Other Promotion

Direct marketing
Overview of strategy, vehicles, and timing
Overview of response targets, goals, and budget
Third-party marketing
 Co-marketing arrangements with other companies
Marketing programs
 Other promotional programs

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 Pricing

• Pricing
– Summarize specific pricing or pricing strategies
– Compare to similar products
• Policies
– Summarize policy relevant to understanding key
pricing issues

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 Distribution

• Distribution strategy
• Channels of distribution
– Summarize channels of distribution
• Distribution by channel
• Show plan of what percent share of
distribution will be contributed by each
channel – a pie chart might be helpful

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 Vertical Markets/Segments

• Vertical market opportunities

– Discuss specific market segment opportunities
– Address distribution strategies for those
markets or segments
– Address use of third-party partner role in
distribution to vertical markets

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 International

• International distribution
– Address distribution strategies
– Discuss issues specific to international
distribution
• International pricing strategy
• Localization issues
– Highlight requirements for local product
variations

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 Success Metrics

• First year goals

• Additional year goals
• Measures of success/failure
• Requirements for success

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 Schedule

• 12-month schedule highlights

• Timing
– Isolate timing dependencies critical to success

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 The Marketing Mix

The marketing mix consists of four basic

marketing strategies known as the 4 P’s.
• Product
• Promotion
• Place
• Price

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 The 4 P’s of Marketing explained
Product Promotion Place Price
1. Is there a 1. Making 1. Distribution is 1. How much are
demand for the customers getting the right customers
product or aware of a product to the willing to pay?
service? product right place at 2. Is the price
2. How to make 2. Advertising the right time in competitive
the product 3. Coupons the right with other
appeal to 4. Rebates amount and in products?
consumer 5. Sales the right 3. Can the
3. Packaging— 6. Free give condition company make
includes the aways 2. Storage a profit?
design, color, 7. Publicity 3. Warehousing
size, and brand 4. Transporting
names

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 Product Development

• Step 1: Look at the items in your bag.

Begin to generate ideas of what product you
can develop. Be creative! Workers often
get together to think of new products. This
is called brainstorming.
• Complete Worksheet #2 – Product
Development

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 Create Product

• Create your product now.

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 Company Name

• Creating a winning company name takes some

thought but is one of the most important things
you’ll do during the process of starting a company.
• So how do you create a winning company name?
Get together for a company name brainstorming
session. Many company names are incorporated
into the logo. Work through these five rules for
choosing a company name:

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5 rules for choosing a company name.

• A winning company name has to

be memorable – but easy to
spell.
• A winning company name needs
a visual element.
• A winning company name should
have a positive connotation.
• A winning company name may
include information about what
your company does.
• A winning company name has to
be fairly short.

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 Logos

• The word logo means: a

name, symbol or trademark
designed for easy recognition.
A logo is a graphical
representation of the
company. It consists of
symbols, illustrations and / or
graphic print design. The logo
should attract attention. It
produces a first impression of
your product.
• How many logos are you
familiar with on this slide?
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 Logos

• Create your company name and logo now

Keep in mind the 5 Principles of effective
Logo Design. (Worksheet #3)

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 Target Market

• A specific group of consumers at which a

company aims its products and services is
called a target market. Your target
customers are those who are most likely to
buy from you.

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 How to identify your target market

Ask some of these questions when identifying

your target market:
• Are your target customers male/female or both?
• How old are they?
• Where do they live? Is geography a limiting factor for any
reason?
• What do they do for a living?
• How much money do they make? This is most significant if
you're selling relatively expensive or luxury items.
• What other aspects of their lives matter? If you're launching a
roof-tiling service, your target customers probably own their
homes.
• What are they willing to pay for your product?
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 Complete Target Market Survey

• Identify your target market. Complete

worksheet #4 in Excel.
TARGET MARKET SURVEY
Worksheet #4
Company Name: Transforms

Product Name: The Wand (when running the wand over clothes it changes to a different outfit)

Survey at least 10 class members regarding your product. Ask students if your product is suited towards a particular gender, age group, and price range. You may change
age group ranges if needed. Determine 3 different price ranges and type them in the fields below. Type a 1 in the columns that best completes the answer. If the product
is for an older population, students would state whether a parent or sibling might buy the product. Sum totals in row 18. Complete the worksheet.
Gender Age group of potential customers Price Range Would Purchase
Male Female 10-20 21-30 31 and up $40-$50 $51-$60 $61-$80 Yes No
1 1 1 1
1 1 1 1
1 1 1 1 1
1 1 1 1
1 1 1 1
1 1 1 1
1 1 1 1
1 1 1 1
1 1 1 1
1 1 1 1
5 5 7 2 1 4 2 5 8 2

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 Advertising

• Now the target market survey is complete you are

ready to create an advertisement.
• Why do companies advertise? To promote their
products and services.
• There are many forms of advertisements including
newspapers, magazines, TV, radio, bill boards,
flyers, web, etc.
• After analyzing your target market survey, create
an advertisement aimed at your customers.

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 Creating Advertisements

• Catchy slogans are great forms of

advertisement.
• Your logos can also be used as
advertisement.
• Advertisements need to catch the interest of
the target market and create a desire for
consumers to buy your product!

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 Logos and Slogans

• Complete Worksheet #5 – Logos and

Slogans
• Complete Worksheet #6 – Create your team
slogan

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 Create a Print Advertisement

• Create an advertisement for your product in

Microsoft Office Publisher or Word.
• Refer to the 4 P’s. Use words and graphics to
identify and explain how the product fits into the 4
P’s.
• Use an 8.5 X 11 inch paper.
• Include a picture of your product on the poster.
• Include your company name, logo, and slogan.
• Use the Print Ad Rubric, for guidelines.
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 Commercials

• Create a commercial advertising your

product.
• Your commercial should be only one minute
long and may be videotaped.
• This will be presented in front of the class.

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 As far as Customers are concerned
there are three elements to address
• Customer value: Difference between the values that
the customer gains from owning and using a product
versus the costs of obtaining the product.

• Customer satisfaction: The extent to which a

product’s perceived performance in delivering value
matches a buyer’s expectations.

• Quality: the characteristics of a product or service that

bear on its ability to satisfy stated or implied customer
needs.

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Marketing Management Philosophies
Agree or Disagree?
1. Production: consumers will favor products that are available and
highly affordable
2. Product: consumers favor products that offer the most in quality,
performance, and innovative features
3. Selling: consumers will not buy unless an organization undertakes
a large-scale selling and promotional effort
4. Marketing: determining the needs and wants of target markets
and delivering the desired satisfactions more effectively and
efficiently then the competitors
5. Societal marketing: generating customer satisfaction and long-
run societal well-being are the keys to both achieving the company’s
goals and fulfilling its responsibilities

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 Relationships

• Relationship marketing: the process of creating,

maintaining, and enhancing strong, value-laden
relationships with customers and other stakeholders.

• Entrepreneurial marketing:
– Businesses started by individuals
– Creativity, drive, and perseverance are keys to success

• Formulated marketing:
– Professional, disciplined approach
– Achieving a market orientation
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 Marketing Concept versus
Selling Concept

Starting Point Focus Means Ends

The Marketing Concept

Customer Integrated Profits from
Market
needs marketing satisfied customers

The Selling Concept

Sell and Profits through

Factory Product
Promote it sales volume

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 Exchange
At Least Two Parties

Something of Value

Conditions for
Communication and Delivery
Exchange

Freedom to Accept or Reject

Desire to Deal with Other Party

269
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 The Four Marketing Management
Philosophies

Orientation Focus is on…

Production internal capabilities of the firm

aggressive sales techniques and belief that high

Sales sales result in high profits

satisfying customer needs and wants while meeting

Market objectives

satisfying customer needs and

wants while enhancing individual and
Societal societal well-being

270

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 Who’s In Charge?

Increased availability of comparative research

enables customers to shop smarter, putting
the customer in the driver seat.

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 Questions That Help Determine
Marketing Philosophy
Orientation Focus

Production What can we make or do best?

Sales How can we sell more aggressively?

Marketing What do customers

want and need?

Societal What do customers want/need, and

how can we benefit society?

272

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 Comparing the Sales and
Market Orientations

Sales Orientation
Inward looking
What the firm makes

Market Orientation
Outward looking
What the market wants

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 Sales vs. Market Orientations
Primary
Organization’s Firm’s For Profit Tools to
Focus Business Whom? Goal? Achieve

Sales Inward Selling Everybody Maximum Primarily

Orien- goods and sales promotion
tation services volume

Market Outward Satisfying Specific Customer Coordin-

Orien- wants and groups of satisfac- ated use of
tation needs people tion marketing
activities

274

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Customer Value Requirements

◆ Offer products that perform

◆ Earn trust
◆ Avoid unrealistic pricing
◆ Give the buyer facts
◆ Offer organization-wide commitment in
service and after-sales support
◆ Co-creation with customers
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 Customer Satisfaction

The customers’ evaluation of a good

or service in terms of whether that
good or service has met their needs
and expectations.

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 Building Relationships
◆ Customer-oriented personnel
◆ Every employee represents the firm in the eyes of the
customer.
◆ Employee training programs
◆ Empowered employees
◆ Employees are given more authority to solve customer
problems on the spot.
◆ Teamwork
◆ Emphasizing cooperation over competition while
helping a customer.
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 Companies with strong marketing & sales alignment get

20%
annual revenue
growth.

Hamed Ali
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 MARKETING & SALES FUNNEL

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 MARKETING & SALES FUNNEL

Top of the
funnel
Marketing's
responsibility

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 MARKETING & SALES FUNNEL

Bottom of the
funnel
Sales’s responsibility

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 MARKETING & SALES FUNNEL

Middle of
the funnel
Shared marketing
& sales
responsibility

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 MARKETING & SALES FUNNEL

Top of the funnel Marketing's responsibility

Middle of the funnel
Shared marketing &
sales responsibility

Bottom of the funnel

Sales’s responsibility

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 MARKETING & SALES FUNNEL
Defining the 6 stages of the marketing and sales funnel.

Contact
The most generic term Contact
for anyone in a
marketing and sales Contact
funnel is a contact.
Contact
The term contact doesn’t indicate
which stage of the funnel they are in, Contact
just simply that they exist in the
funnel. Contact

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 MARKETING & SALES FUNNEL
Defining the 6 stages of the marketing and sales funnel.

Prospect/Visitor Top of
the funnel
Marketing's
responsibility

Prospect: Middle of the

Prospects are website visitors
who you’ve gathered minimal
funnel
Shared marketing &
data on or who have signed up
sales
for a blog or an email
newsletter. responsibility

Bottom of the
funnel
Sales’s responsibility

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 MARKETING & SALES FUNNEL
Defining the 6 stages of the marketing and sales funnel.

Prospect/Visitor Top of
the
funnel
Lead Marketing's
responsibilit
Lead: Middleyof the
When you use the term ‘lead’
you’re referring to a contact
funnel
Shared marketing &
who has submitted a form in
sales
return for a content offer like an
responsibility
eBook, whitepaper, etc.
Bottom of the
funnel
Sales’s responsibility

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 MARKETING & SALES FUNNEL
Defining the 6 stages of the marketing and sales funnel.

Prospect/Visitor Top of
the
funnel
Lead Marketing's
Marketing responsibilit
Qualified Lead MQL Middleyof the
(MQL): funnel
Contacts who have raised their Shared marketing &
hands (metaphorically sales
speaking) and identified responsibility
themselves as more deeply
engaged, Bottom of the
sales-ready leads. funnel
Sales’s responsibility

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 MARKETING & SALES FUNNEL
Defining the 6 stages of the marketing and sales funnel.

Prospect/Visitor Top of
the
funnel
Lead Marketing's
responsibilit
Sales Middleyof the
MQL
Qualified Lead funnel
(SQL): SQL
Shared marketing &
sales
SQLs are MQLs that your sales
responsibility
team has determined to be
worthy of a direct follow-up.
Bottom of the
funnel
Sales’s responsibility

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 MARKETING & SALES FUNNEL
Defining the 6 stages of the marketing and sales funnel.

Prospect/Visitor Top of
the
funnel
Lead Marketing's
responsibilit
Opportunity: Middleyof the
An opportunity is an SQL that a MQL
sales rep has communicated
funnel
Shared marketing &
with and logged as a legitimate, SQL sales
potential customer.
responsibility
Opportunit
Bottom of the
y
funnel
Sales’s responsibility

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 MARKETING & SALES FUNNEL
Defining the 6 stages of the marketing and sales funnel.

Prospect/Visitor Top of
the
funnel
Lead Marketing's
responsibilit
MQL Middleyof the
funnel
Shared marketing &
SQL sales
responsibility
Opportunit
Bottom of the
y
funnel
Customer Sales’s responsibility

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