Outline of the components of marketing practice and the text book
Learning objectives 1Define the term marketing 2Explain the marketing exchange conditions and their influence on marketing 3Explain the five competing business orientations that impact on marketing strategy 4Describe the marketing process 5Give several reasons for studying marketing
1What is marketing? Personal selling Advertising Making products available in stores Maintaining inventories All of the above, plus much more
1What is marketing? (cont.) A philosophy An attitude A perspective A management orientation plus A set of activities, including: –products –pricing –promotion –distribution.
‘Marketing is the process of planning and executing the conception, pricing, promotion and distribution of ideas, goods and services to create exchanges that satisfy individual and organisational goals.’ 1What is marketing? (cont.) American Marketing Association definition
2 Explain the marketing exchange conditions and their influence on marketing Learning objective
2Five conditions of a marketing exchange At least two parties Something of value Desire to deal with other party Ability to communicate offer Freedom to accept or reject
3 Explain the five competing business orientations that impact on marketing strategy Learning objective
3 Production orientation Focus on the efficiency of internal operations better and cheaper products a philosophy that focuses on the internal capabilities of the organisation, rather than on the desires and needs of the marketplace.
3 Sales orientation Focuses on aggressive techniques for overcoming customer resistance The idea that people will buy more goods and services if aggressive sales techniques are used and that high sales result in high profits.
3The marketing concept The idea that the social and economic justification for an organisation’s existence is the satisfaction of customer wants and needs, while meeting organisational objectives.
3The marketing concept Focusing on customer wants and needs can be a source of competitive advantage through: –creating customer value –maintaining customer satisfaction –building long-term relationships.
3Relationship marketing orientation The name of a strategy that entails forging long-term partnerships with customers, which is based on the marketing orientation.
3Relationship marketing’s importance Attracting a new customer may be ten times the cost of keeping an old customer.
3Societal marketing orientation Marketing that preserves or enhances the long-term best interests of society or an individual. an less toxic products –more durable products –products with reusable or recyclable material.
3Competitive advantage The idea that a product can solve a set of customer problems better than any competitors’ product.
3Customer value The ratio of benefits to the sacrifice necessary to obtain those benefits.
3Customer value requirements Offer products that perform. Give consumers more than they expect. Avoid unrealistic pricing. Give the buyer facts. Offer organisation-wide commitment in service and after-sales support.
3Customer satisfaction The feeling that a product has met or exceeded the customer’s expectations.
3Maintaining customer satisfaction Meet or exceed customer expectations Focus on delighting customers Provide solutions to customer problems.
Understand the organisation’s mission Set marketing objectives Gather, analyse and interpret information Develop a marketing strategies for markets Implement the marketing strategy Design performance measures Evaluate marketing efforts – change if needed. 4Marketing process activities
4Environmental scanning Collection and interpretation of information about forces, events and relationships in the external environment that may affect the future of the organisation or the marketing plan implementation.
A unique blend of –product –distribution –promotion –pricing strategies. designed to produce mutually satisfying exchanges with a target market. 4The marketing mix
The starting point of the ‘four Ps’ Includes physical unit, package, warranty, service, brand, image and value 4Product strategies
Product availability – where and when customers want them Involves all activities from raw materials to finished products Impact of the Internet 4Distribution (place) strategies
Role is to bring about exchanges with target markets Includes integration of personal selling, advertising, sales promotion, and public relations, direct marketing and Internet marketing 4Promotion strategies
4Pricing strategies What is given up in an exchange to acquire a good or service.
5 Describe several reasons for studying marketing Learning objective
5Why study marketing? Plays an important role in society Vital to business survival, profits and growth Offers career opportunities Affects your life every day
5Why study marketing? (cont.) ‘Marketing is too important to be left to the marketing department.’ David Packard, Hewlett-Packard
Global opportunities Fastest route up the corporate ladder Important in all business sectors Understanding everyday life Professional selling Marketing research Advertising Retail buying Distribution management Product management Product development Wholesaling 5Why study marketing? (cont.)
Half of every dollar spent by consumers pays for marketing costs. Become a better-informed consumer. 5Why study marketing? (cont.)
Class discussion Is the term marketing ethics an oxymoron?
Ethical problems in marketing research –Alleged invasions of personal privacy –Gathering marketing information in exchange for money or free offers Ethical problems in product strategy –Product quality –Planned obsolescence –Brand similarity –Packaging
Ethical problems in distribution strategy –Determining the appropriate degree of control over a channel –Determining whether a company should distribute its products in marginally profitable outlets that have no alternative source of supply Ethical problems in pricing –Probably the most regulated aspect –Most unethical pricing behaviour is also illegal
Ethical problems in promotional strategy –The source of the majority of ethical questions –Ethically questionable personal selling Gifts and bribes –Questionable advertising –Promotion of questionable features (air bags) –Questionable WWW related promotional practices