BUS 365
Principles of Marketing
Prof. A. Della Bitta
The Text – Marketing 2nd edition, 2011
McGraw-Hill ISBN: 978-0-07-340487-5
What is Marketing?
What is Marketing?
It is much more than
advertising or promotion
Definition of Marketing by American Marketing
Association:
Book- quoting AMA in 12-2008: Marketing is the
activity, set of institutions, and processes for creating,
capturing, communicating, delivering and exchanging
offerings that have value for customers, clients, partners,
and society at large.
AMA Website 04-2010: Marketing is an organizational
function and a set of processes for creating,
communicating, and delivering value to customers and for
managing customer relationships in ways that benefit the
organization and its stakeholders.
Source: http://www.marketingpower.com/_layouts/Dictionary.aspx?dLetter=M
Marketing Facilitates Exchanges
Marketing Exchange
People giving up something to
receive something they would rather have.
At least two parties
A willingness to deal with
Minimum another party
conditions
needed for an Involves something perceived
exchange to to be of value
occur
Communication and delivery
Freedom to accept or reject
Why Study Marketing?
Plays an important role in society
Vital to business survival, profits and growth
Half of every dollar spent by consumers is for
marketing costs.
Become a better-informed consumer.
Offers career opportunities
Marketing focuses on discovering
_________ and
_______
satisfying consumers’ wants and needs
What is a - -
Consumer:
Customer:
Market:
Need:
Want:
Market:
Core Aspects of Marketing
Philosophies of Doing Marketing
Philosophy
Philosophy Key focus of the orientation
Production Focus on efficiency of internal operations –
better & cheaper products. Up to late 1920s
Focus on product features – “consumers will
Product want the highest quality products 1920s – late 1930s
Focus on aggressive techniques to over-
Sales come customer resistance – “our warehouse is
full, we need to unload this stuff” 1948 – 1955 or so
Focus on satisfying customer needs & wants
Marketing “find out the needs/wants consumers & satisfy those
if that are profitable for us to do so” 1955 - 1990s
2000s Focus on satisfying certain needs/wants if
Societal Mkt. it is profitable and if it is consistent with enhancing
individual and societal well-being
These Orientations Differ
on the Following Characteristics
► Organization’s focus ► Firm’s primary goal
► Definition of firm’s business ► Tools used to achieve
► For whom the product is directed those goals
Example
Focus Firm’s For Primary Tools to
Business Whom? Goal? Achieve?
Sales Inward Selling Maximum Primarily
Orientation goods and Everybody sales promotion
services volume
Market Outward Satisfying Specific Customer Coordinated
Orientation wants and groups of satisfaction use of all
needs people marketing
activities
Recapitulation
Orientation Focus
Production What can we make or do best?
Sales How can we sell more aggressively?
What do customers
Marketing want and need?
What do customers want and need,
Societal and how can we satisfy those
wants/needs and benefit society?
The Marketing Orientation
Focusing on customer wants and needs can be a
source of competitive advantage by:
Creating customer value
Maintaining customer satisfaction
Building long-term relationships
Customer Value
The result of evaluation of benefits to
the sacrifice necessary to obtain those
benefits - it is in essence what you get
for what you give up.
• The fundamental purpose of marketing
is to create value for both the firm and
customer.
Customer Satisfaction
The customer’s feeling that a product has
met or exceeded his/her expectations.
Expectations
and
Product Performance
Relationship Marketing
A strategy that entails developing long-term
partnerships with customers - - both individuals and
firms.
The Marketing Process
Organizational mission
Situational
analysis
Marketing strategy
(Segmentation, Targeting & Positioning
Environ-
mental
Marketing mix: scan
• product
• distribution
• promotion
• price
Implementation
Evaluation
An organization’s marketing department
relates to many people, groups, and forces
Marketing’s First Task:
Discovering Consumers’ Needs
Identification of actual needs & wants
Customers’ words and behavior are suggestive
of their needs & wants
Potential consumers in the marketplace
Environmental scanning….
Collecting and interpreting data about forces, events
and relationships in the external environment that
have relevance to the organization’s marketing plan
and/or its implementation.
Environmental Scanning
Examination of macroenvironmental forces
Social
Demographic
Economic
Technological
Political / Legal
Competitive
Helps identify market opportunities
Provides guidelines for design of marketing strategy
Marketing’s Second Task:
Satisfying Consumer Needs
An organization can’t satisfy the needs of
all consumers, so it must focus on one or more
target markets
subgroups, which are its ____________.
The Marketing Mix
A unique blend of:
product,
distribution,
promotion, and
pricing strategies
designed to produce mutually satisfying
exchanges with a target market.
Marketing mix: The ‘four Ps’
Product Place
Price Promotion
Product
Product
Promotion
Promotion 4P’s
4P’s Price
Price
Place
Place
Product Strategies
The starting point of the ‘four Ps’
Includes physical unit, package,
warranty, service, brand, image
and value
Pricing Strategies
They are typically based on
viewing price as what is
given up in an exchange to
acquire a good or service.
Distribution (Place) Strategies
Product availability – where and when
customers want them
Involves all activities from raw materials
to finished products
Impact of the Internet
Promotion Strategies
Role is to bring about exchanges with
target markets – inform, persuade, remind
Includes integration of personal selling,
advertising, sales promotion, and public
relations, direct marketing and Internet
marketing
Answer these two questions
The fundamental purpose of Marketing is to help
create value.
1. How does it do this?
2. What are the two ways that marketing can
increase value for customers?
