1. 1 Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1 1 An Overview of Marketing

2. 2 Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1 Learning Objectives 1.Define the term marketing 2.Describe four marketing management philosophies 3.Discuss the differences between sales and market orientations 4.Describe several reasons for studying marketing

3. 3 Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1 Learning Objective Define the term marketing Online http://www.marinemax.com 1 1 1

4. 4 Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1 What Is Marketing? A Philosophy An Attitude A Perspective A Management Orientation A Set of Activities, including: Products Pricing Promotion Distribution 1

5. 5 Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1 What Is Marketing? American Marketing Association Definition 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. 1

6. 6 Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1Marketing 1 Product Price Place Promotion Exchange A B Delivering Value Communicating Value Creating Value

7. 7 Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1 The Concept of Exchange Exchange The idea that people give up something to receive something they would rather have. 1

8. 8 Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1 The Concept of Exchange Necessary Conditions for Exchange At Least Two Parties Something of Value Communication and Delivery Freedom to Accept or Reject Desire to Deal With Other Party 1

9. 9 Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1  Exchange may not take place even if conditions are met  An agreement must be reached  Marketing occurs even if exchange does not take place The Concept of Exchange 1

10. 10 Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1 Learning Objective Describe four marketing management philosophies 2 2 2

11. 11 Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1CompetingPhilosophiesCompetingPhilosophies Production Sales Market Societal Marketing Marketing Management Philosophies 2

12. 12 Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1 Societal Orientation Key Ideas Production Sales Market Focus on internal capabilities of the firm Focus on satisfying customer needs and wants while meeting objectives Focus on satisfying customer needs and wants while enhancing individual and societal well-being Focus on aggressive sales techniques and believe that high sales result in high profits Marketing Management Philosophies 2

13. 13 Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1 The Marketing Concept The idea that the social and economic justification for an organization’s existence is the satisfaction of customer wants and needs while meeting organizational objectives. 2

14. 14 Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1 The Marketing Concept  Focusing on customer wants and needs to distinguish products from competition  Integrating all the organization’s activities to satisfy customer wants and needs  Achieving the organization’s long-term goals by satisfying customer wants and needs 2

15. 15 Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1 Achieving a Market Orientation  Obtain information about customers, competitors, and markets  Examine the information from a total business perspective  Determine how to deliver superior customer value  Implement actions to provide value to customers  Establish and maintain mutually rewarding relationships with customers Online http://www.westernunion.com 2

16. 16 Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1 Less toxic products More durable products Products with reusable or recyclable materials Less toxic products More durable products Products with reusable or recyclable materials Societal Marketing Orientation Marketing that preserves or enhances an individual’s and society’s long-term best interests 2

17. 17 Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1 Review: Marketing Management Philosophies 2 Production Sales Marketing Societal What can we make or do best? How can we sell more aggressively? What do customers want and need? What do customers want and need, and how can we benefit society? OrientationFocus

18. 18 Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1 Learning Objective Discuss the differences between sales and market orientations 3 3 3

19. 19 Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1 Comparing the Sales and Marketing Orientations Organization’s focus Firm’s business Those to whom the product is directed Firm’s primary goal You can compare these orientations against these four categories: 3

20. 20 Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1 The Organization’s Focus Create Customer Value Create Customer Value Build Long-Term Relationships Maintain Customer Satisfaction Maintain Customer Satisfaction Key Issues in Developing Competitive Advantage 3

21. 21 Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1 Customer Value The ratio of benefits to the sacrifice necessary to obtain those benefits 3

22. 22 Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1 Customer Value Requirements Offer products that perform Give consumers more than they expect Avoid unrealistic pricing Give the buyer facts Offer organization-wide commitment in service and after-sales support Online http://www.iflyswa.com 3

23. 23 Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1 Customer Satisfaction The feeling that a product has met or exceeded the customer’s expectations. Customer Satisfaction 3

24. 24 Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1 Maintaining Customer Satisfaction  Meet or exceed customer’s expectations  Focus on delighting customers  Provide solutions to customer’s problems  Cultivate relationships, NOT one-time transactions 3

25. 25 Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1 Relationship Marketing The name of a strategy that entails forging long-term partnerships with customers, both individuals and firms. 3

26. 26 Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1 Relationship Marketing Requirements for Building Relationships Requirements for Building Relationships Who are your customers What do customers value How do they prefer to interact What do they want to buy 3

27. 27 Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1 Building Long-Term Relationships  Customer-oriented personnel  Effective training programs  Empowered employees  Teamwork 3

28. 28 Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1 Defining a Firm’s Business “Benefits” instead of “goods/services”  Ensures a customer focus  Encourages innovation and creativity  Stimulates an awareness of changes in customer preferences Online http://www.britannica.com 3

29. 29 Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1 Review: Sales vs. Market Orientations Organization’s Focus Firm’s Business For Whom? Primary Profit Goal? Tools to Achieve Selling goods and services EverybodyMaximum sales volume Primarily promotion Inward Sales Orientation Market Orientation OutwardCoordinated use of all marketing activities Customer satisfaction Specific groups of people Satisfying wants and needs 3

30. 30 Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1 Learning Objective Describe several reasons for studying marketing. 4 4 4

31. 31 Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1 Why Study Marketing?  Plays an important role in society  Vital to business survival, profits and growth  Offers career opportunities  Affects your life every day 4

32. 32 Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1 Why Study Marketing? “Marketing is far too important to be left only to the marketing department.” -- David Packard Hewlett-Packard “Marketing is far too important to be left only to the marketing department.” -- David Packard Hewlett-Packard 4

33. 33 Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1  Between a fourth and a third of the civilian workforce in the U.S. performs marketing activities  Marketing offers great career opportunities Professional Selling Marketing Research Advertising Retail Buying Distribution Management Product Management Product Development Wholesaling Professional Selling Marketing Research Advertising Retail Buying Distribution Management Product Management Product Development Wholesaling Why Study Marketing? 4

34. 34 Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1  Half of every dollar spent pays for marketing costs  Better-informed consumers  Demand for customer satisfaction Why Study Marketing? 4

35. 35 Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1 Review: Why Study Marketing? 4 Why Study Marketing? Important to Society Important to Business Good Career Opportunities + Marketing affects you every day!

36. 36 Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1 Marketing Process 4 Understand the marketplace and customer needs and wants Understand the marketplace and customer needs and wants Build profitable relationships and create customer delight Build profitable relationships and create customer delight Design a customer-driven marketing strategy Design a customer-driven marketing strategy Construct a marketing program that delivers superior value Construct a marketing program that delivers superior value Capture value from customers to create profits and customer loyalty Capture value from customers to create profits and customer loyalty