1. Marketing: Helping Buyers Buy
Chapter 13
Marketing: Helping Buyers Buy
McGraw-Hill/Irwin
Copyright © 2013 by The McGraw-Hill Companies, Inc. All rights reserved.

2. WHAT’S MARKETING?
What is Marketing?
LG1
Marketing -- The activity and processes for creating, communicating, delivering, and exchanging offerings with value for customers, clients, partners, and society at large.
Often think of marketing as the activities buyers and sellers perform to facilitate mutually satisfying exchanges.
See Learning Goal 1: Define marketing and apply the marketing concept to both for-profit and non-profit organizations.
Simply put, marketing is activities buyers and sellers perform to facilitate mutually beneficial exchanges.
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3. FOCUS of CONTEMPORARY MARKETING
What is Marketing?
LG1
Marketing today involves helping the buyer buy through:
Websites that help buyers find the best price, identify product features, and question sellers.
Blogs and social networking sites that cultivate consumer relationships.
includes decisions about the best way to get the product to the consumer
See Learning Goal 1: Define marketing and apply the marketing concept to both for-profit and non-profit organizations.
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4. FOUR ERAS of U.S. MARKETING
The Evolution of Marketing
LG1
Production Era
Selling Era
Marketing Concept Era
Customer Relationship Era
See Learning Goal 1: Define marketing and apply the marketing concept to both for-profit and non-profit organizations.
In the United States, marketing has evolved through four eras: (1) production, (2) selling, (3) marketing concept, and (4) customer relationship.
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5. The PRODUCTION ERA and SELLING ERA
The Evolution of Marketing
LG1
The general philosophy was “Produce what you can because the market is limitless.”
We still see this what industry?
By 1920s, after mass production, the focus turned from production to persuasion.
See Learning Goal 1: Define marketing and apply the marketing concept to both for-profit and non-profit organizations.
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6. The MARKETING CONCEPT ERA
The Evolution of Marketing
LG1
After WWII in 1945, a consumer spending boom developed.
Why did this spending boom happen?
Businesses knew they needed to be responsive to consumers if they wanted their business.
See Learning Goal 1: Define marketing and apply the marketing concept to both for-profit and non-profit organizations.
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7. APPLYING the MARKETING CONCEPT
The Evolution of Marketing
LG1
The Marketing Concept includes three parts:
Customer Orientation -- Finding out what customers want and then providing it.
Service Orientation -- Making sure everyone in an organization is committed to customer satisfaction…from President to the delivery people.
Profit Orientation -- Focusing on the goods and services that will earn the most profit.
See Learning Goal 1: Define marketing and apply the marketing concept to both for-profit and non-profit organizations.
Took a long time to come around…finally in 1980s business adopted these concepts which lead to Customer Relationship management (CRM)
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8. The CUSTOMER RELATIONSHIP ERA
The Evolution of Marketing
LG1
Customer Relationship Management (CRM) -- Learning as much as you can about customers and doing what you can to satisfy or exceed their expectations over time.
Organizations seek to enhance customer satisfaction building long-term relationships.
Today firms like Priceline and Travelocity use CRM that allow customers to build a relationship with the suppliers.
See Learning Goal 1: Define marketing and apply the marketing concept to both for-profit and non-profit organizations.
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9. SERVICE with a SMILE Six Steps for Keeping Your Customers Happy
The Evolution of Marketing
LG1
The cost of acquiring a new customer is 5x the cost of retaining one. Here’s how to keep them:
Build trust
Emphasize the long term
Listen
Treat your customers like stars
Show appreciation
Remember employees are customers too!
See Learning Goal 1: Define marketing and apply the marketing concept to both for-profit and non-profit organizations.
Service with a Smile
It’s important for companies to keep hold of their customer base. It’s too costly to keep searching out new customers.
Ask students: What has a company done to keep you coming back? What has a company done to you that ensures you’ll never leave?
Source: Inc. Guidebook, Vol. 2 No. 5 and Entrepreneur, February 2010.
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10. The FOUR P’s The Marketing Mix LG2
See Learning Goal 2: Describe the four P’s of marketing.
The Four P’s are also known as the marketing mix.
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11. DEVELOPING a PRODUCT
Designing a Product to Meet Consumer Needs
LG2
Product -- A good, service, or idea that satisfies a consumer’s want or need.
Test Marketing -- Testing products among potential product users. Concept Testing: Creating an accurate description and ask people what they think of the product.
Brand Name -- A word, letter, or a group of words or letters that differentiates one seller’s goods from a competitor’s.
See Learning Goal 2: Describe the four P’s of marketing.
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12. PRICING and PLACING a PRODUCT
Setting an Appropriate Price
PRICING and PLACING a PRODUCT
LG2
Pricing products depends on many factors:
Competitors’ prices
Production costs
Distribution
Middlemen are important in place strategies because getting a product to consumers is critical.
See Learning Goal 2: Describe the four P’s of marketing.
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13. Photo Courtesy of: Uri Baruchin
PROMOTING the PRODUCT
Developing an Effective Promotional Strategy
LG2
Promotion -- All the techniques sellers use to inform people about their products and motivate them to purchase those products.
Promotion includes:
Advertising
Personal selling
Public relations
Word of mouth
Sales promotions
Relationships – listening and responding to customer feedback
See Learning Goal 2: Describe the four P’s of marketing.
Photo Courtesy of: Uri Baruchin
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14. SEARCHING for INFORMATION
Providing Marketers with Information
LG3
Marketing Research -- Analyzing markets to determine challenges and opportunities, and finding the information needed to make good decisions.
Research used to determine what customers have purchased in the past, what situational changes have occurred to change consumer preferences, and what consumers are likely to want in the future.
See Learning Goal 3: Summarize the marketing research process.
To understand customer wants and needs, it is critical to conduct market research. Good market research will identify products consumers have used, want to use in the future and market trends.
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15. FOUR STEPS in the MARKETING RESEARCH PROCESS
LG3
Defining the problem or opportunity and determining the present situation.
Collecting research data.
Analyzing the data.
Choosing the best solution and implementing it.
See Learning Goal 3: Summarize the marketing research process.
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16. COLLECTING SECONDARY RESEARCH DATA
The Marketing Research Process
COLLECTING SECONDARY RESEARCH DATA
LG3
Secondary Data -- Existing data that has previously been collected by sources like the government.
Secondary data incurs no expense and is usually easily accessible.
Secondary data doesn’t always provide all the needed information for marketers….leads to primary data
See Learning Goal 3: Summarize the marketing research process.
Secondary research is cheaper and often easier to gather than primary research, but may be outdated.
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17. COLLECTING PRIMARY RESEARCH DATA
The Marketing Research Process
COLLECTING PRIMARY RESEARCH DATA
LG3
Primary Data -- In-depth information gathered by marketers from their own research.
Telephone, online and mail surveys, personal interviews, and focus groups are ways to collect primary data.
See Learning Goal 3: Summarize the marketing research process.
Primary data is timely, but can be expensive and time consuming to gather.
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18. FOCUS GROUPS
The Marketing Research Process
LG3
Focus Group -- A group of people who meet under the direction of a discussion leader to communicate opinions.
See Learning Goal 3: Summarize the marketing research process.
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19. WAYS to FIND OUT WHAT CONSUMERS THINK
The Marketing Research Process
WAYS to FIND OUT WHAT CONSUMERS THINK
LG3
Conduct informal consumer surveys
Host a customer focus group
Listen to competitor’s customers
Survey your sales force
Become a “phantom” customer
See Learning Goal 3: Summarize the marketing research process.
Ways to Find Out What Consumers Think
The goal of market research is to better understand what consumers are thinking.
This slide addresses some of the ways that organizations can discover consumer wants and needs.
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20. SCANNING the MARKETING ENVIRONMENT
LG4
Environmental Scanning -- The process of identifying factors that affect marketing success.
Factors involved in the environmental scan include:
Global factors
Technological factors
Sociocultural factors
Competitive factors
Economic factors
See Learning Goal 4: Show how marketers use environmental scanning to learn about the changing marketing environment.
Environmental scanning is the process of identifying factors that affect marketing success. The environment of marketing is changing faster than at any time in history. Companies that don’t keep up, will fail to survive. Today’s marketing environment is influenced by the global marketplace and the explosion of the information age. To be fully prepared, a company must recognize and understand: cultural influences; governmental and political influences; demographic and lifestyle trends; local, national, and world economic trends; the strengths of multi-national competitors; and the influence of technology on physical distribution.
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21. The CONSUMER and B2B MARKET
Two Different Markets: Consumer and B2B
The CONSUMER and B2B MARKET
LG4
Consumer Market -- All the individuals or households that want goods and services for personal use and have the resources to buy them.
Business-to-Business (B2B) -- Individuals and organizations that buy goods and services to use in production or to sell, rent, or supply to others.
See Learning Goal 4: Show how marketers use environmental scanning to learn about the changing marketing environment.
The buyer’s intended end use of the product determines whether a product is consumer or B2B.
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22. MARKETING to CONSUMERS
The Consumer Market
LG5
The size and diversity of the consumer market forces marketers to decide which groups they want to serve.
Market Segmentation -- Divides the total market into groups with similar characteristics.
Target Marketing -- Selecting which segments an organization can serve profitably.
Campbell soup example…
See Learning Goal 5: Explain how marketers apply the tools of market segmentation, relationship marketing, and the study of consumer behavior.
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23. Different ways to Segment the Consumer Market
Segmenting the Consumer Market
Different ways to Segment the Consumer Market
LG5
Geographic Segmentation -- Dividing the market by cities, counties, states, or regions.
Demographic Segmentation -- Dividing the market by age, income, education, and other demographic variables.
Psychographic Segmentation -- Dividing the market by group values, attitudes, and interests.
(continued)
See Learning Goal 5: Explain how marketers apply the tools of market segmentation, relationship marketing, and the study of consumer behavior.
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24. SEGMENTING the CONSUMER MARKET (continued)
LG5
Benefit Segmentation -- Dividing the market according to product benefits the customer prefers.
Volume (Usage) Segmentation -- Dividing the market by the volume of product use.
See Learning Goal 5: Explain how marketers apply the tools of market segmentation, relationship marketing, and the study of consumer behavior.
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25. MARKETING to SMALL SEGMENTS
Reaching Smaller Market Segments
MARKETING to SMALL SEGMENTS
LG5
Niche Marketing -- Identifies small but profitable market segments and designs or finds products for them.
See Learning Goal 5: Explain how marketers apply the tools of market segmentation, relationship marketing, and the study of consumer behavior.
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26. MASS MARKETING vs. RELATIONSHIP MARKETING
Moving Toward Relationship Marketing
MASS MARKETING vs. RELATIONSHIP MARKETING
LG5
Mass Marketing -- Developing products and promotions to please large groups of people. Selling to as many people as possible; using mass media like TV; so focused on competition that they often become less responsive to the market; airlines are an example of this
Relationship Marketing-- Rejects the idea of mass production and focuses toward custom-made goods and services for customers.
See Learning Goal 5: Explain how marketers apply the tools of market segmentation, relationship marketing, and the study of consumer behavior.
Mass marketing uses little market segmentation.
The goal of relationship marketing is to keep customers happy by offering products that meet exact expectations
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27. BUSINESS-to-BUSINESS MARKET (B2B)
The Business-to-Business Market
LG6
B2B marketers include:
Manufacturers
Wholesalers and retailers
Hospitals, schools and charities
Government
Products are often sold and resold several times before reaching final consumers.
B2B market involves the marketing of goods and services to institutions that sell, rent, produce or supply goods to others
See Learning Goal 6: Compare the business-to-business market and the consumer market.
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28. B2B MARKET DIFFERENCES from the consumer market
The Business-to-Business Market
LG6
There are relatively few customers.
Customers tend to be large buyers.
Markets are geographically concentrated.
Buyers are more rational than emotional.
Sales are direct.
Promotions focus heavily on personal selling.
See Learning Goal 6: Compare the business-to-business market and the consumer market.
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