16 Product Service Management Obtaining, developing, maintaining, and improving a product or a product mix in response to market opportunities.
17 Promotion Communicating with potential customers to inform, persuade, or remind them about a business’s products
18 Selling Planned, personalized communication that influences purchasing decisions
19 The Marketing ConceptBusinesses must satisfy customers’ needs and wants in order to make a profit
20 When Henry Ford first created the Model T, he was the only one mass producing cars. He didn’t have to think about “The Marketing Concept.” But, as more and more producers started making cars, they had to think about what customers need and want in order to stay in business.Click on the Model T Ford to see Henry Ford’s thoughts about car color in the early 1900’s.
21 Imagine if, in today’s world, you could only buy black Imagine if, in today’s world, you could only buy black. Many customers would not be very happy!
22 The Marketing ConceptIf automobile manufactures do not give their customers a choice (what they want), they will not stay in business.That concept is true for all businesses.You must give the customer what they need and want.
23 That is what we mean by The Marketing Concept Businesses must know their customers . . .Businesses must satisfy customers’ needs and wants in order to make a profit
24 Economic Benefits of Marketing Marketing bridges the gap between you and the maker or seller of an item
25 Economic Benefits of Marketing New and Improved Products --businesses look for opportunities to please the customer
26 Economic Benefits of Marketing Lower Prices – marketing activities add value and increase demand. When demand is high, manufacturers can produce at a lower price. They can sell at a lower price but increase the quantity sold. Thus, profits are higher even though prices are low.
28 Added Value = UtilityIn economic terms, utility does not mean your closet or the electric company.
29 There are five types of Utility: Added Value = UtilityAttributes of a product or service that make it capable of satisfying consumers’ wants and needs.There are five types of Utility:
30 Form UtilityChanging raw materials or putting parts together to make them more useful – making and producing things.Sand into glassWood into paperSilk into fabric
31 Having a product where customers can buy it. Place UtilityHaving a product where customers can buy it.
32 It InvolvesLocation – may be through a catalog or at a retailer (actual store) – or, Internet.Transporting the product to the location.
33 Time Utility Planning and ordering Time of day and week Having a product available at a certain time of year or a convenient time of day.Time UtilityPlanning and orderingTime of day and weekTime of year: holidays and seasons
34 Possession UtilityThe exchange of a product for some monetary value.
35 Payment may be made byCashPersonal checksCredit cardsInstallments(layaway)
36 Information Utility Involves communication with the consumer. adspackagingsignsdisplaysowner’s manuals
37 Which types of utility are related to marketing? Form utility is a function of production, NOT marketing
38 These utilities ARE directly related to marketing: PlaceTimePossessionInformation
39 Market – all potential customers who have the ability and willingness to buy
40 Consumer MarketsConsist of consumers who purchase goods and services for personal use.
41 Industrial MarketsBusiness-to-business (B-to B) markets include all businesses that buy products for use in their operations.
42 Market ShareA company’s percentage of the total sales volume generated by all companies that compete in a given market.
43 Target MarketingFocusing all decisions on a very specific group of people who you want to reach.
44 Customer ProfileTo develop a clear picture of their target market, businesses create a customer profile.It lists information about the target market, such as age, income level, occupation, attitudes, lifestyle, and geographic residence
45 Customers – people who buy the product Consumers – people who actually use the productIs mom the customer or the consumer? The kids?
46 Marketing Mix Basic marketing strategies – the four P’s ProductPlacePricePromotion
47 Product Strategies What product to make How to package it What brand name to useWhat image to project
48 Place StrategiesHow and where a product will be distributed.
49 Price StrategiesReflect what customers are willing and able to pay.
50 Promotion StrategiesHow potential customers will be told about the new productWhat the message will beWhen and where it will be deliveredWhat inducements are there to buy
51 The Marketing Mix Product Place Price Promotion The elements are interconnectedProductPlaceThe Marketing MixPricePromotion
52 The Marketing Mix – The 4 P’s Contains countless alternatives.Management must select a combination of marketing mix decisions that will satisfy target markets and achieve organizational goals.
53 Analyzing MarketsMarket segmentation is a way of analyzing a market by specific characteristics in order to create a target market
54 Types of Segmentation: DemographicsPsychographicsGeographicsBehavioral
55 Demographics – statistics that describe a population in terms of personal characteristics. AgeBaby Boom GenerationGeneration XGeneration YGender
56 Income Disposable income – money left after taking out taxes Discretionary income – money left after paying for basic living necessities such as food, shelter, and clothing