1. Marketing Is All Around Us
SO WHAT IS MARKETING?
Chapter 1

2. MARKETING To be a successful marketer, you need to understand:
Marketing skills
Marketing core functions
Basic tools of marketing
Our goals for this section are to:
Define marketing
Understand the marketing concept
List the seven marketing core functions

3. BASIC INFORMATION
Goods: tangible items that have monetary value and satisfy your needs and wants.
Examples: cars, iPhone, toys, clothing
Services: intangible items or tasks performed for a customer.
Intangible: you cannot physically touch them.
Examples: hair cut, massage, car wash, movie theatre
Exchange: when something is bought and sold in the marketplace.

4. MARKETING
Marketing: the process of planning, pricing, promoting, selling, and distributing ideas, goods or services to create exchanges that satisfy customers.

5. MARKETING CONCEPTS
Marketing concept: the idea that a business should strive to satisfy customers’ needs and wants while generating profit. The focus is on the customer.
For a business to be successful, all 7 marketing core functions need to support this concept.

6. 7 Marketing Core Functions
1) Channel Management
2) Market Planning
3) Marketing Information Management
4) Pricing
5) Product/Service Management
6) Promotion
7) Selling

7. 1) CHANNEL MANAGEMENT
Channel management (or distribution): the process of deciding how to get goods into customers’ hands.

8. 2) MARKET PLANNING
Market planning (financing): understanding the concepts and strategies used to develop and target specific marketing strategies to a select audience.

9. 3) MARKETING INFORMATION MANAGEMENT
Marketing information management: gathering, storing, and analyzing information about customers, trends, and competing products.

10. 4) PRICING
Pricing: making decisions that dictate how much to charge for goods and services in order to make a profit.

11. 5) PRODUCT/SERVICE MANAGEMENT
Product/service management: obtaining, developing, maintaining, and improving a product or a product mix in response to market opportunities.

12. 6) PROMOTION
Promotion: the effort to inform, persuade, or remind potential customers about a business’ products or services.

13. 7) SELLING
Selling: provides customers with the goods and services they want.

14. MARKETING Our goals for this section were to:
Define marketing
Understand the marketing concept
List the seven marketing core functions
Marketing supports competition and offers benefits to consumers.
Our goals for the next section are to:
Analyze the benefits of marketing
Apply the concept of utility

15. THE IMPORTANCE OF MARKETING
Through the study of marketing, you will realize how important it is and how much marketing affects your life and the lives of other consumers.
Marketing plays and important role in the economy because it provides a means for competition to take place.

16. ECONOMIC BENEFITS OF MARKETING
The benefits of competition are:
New and improved products
Lower prices
Added value and utility
The 7 core functions of marketing add VALUE to a product.
Expert economists call “added value” = utility
Utilities: attributes of a product that make it capable of satisfying consumers’ wants and needs.

17. 5 ECONOMIC UTILITIES 1) Form 2) Place 3) Time 4) Possession
5) Information

18. 1) FORM UTILITY
Form utility: involves changing raw materials or putting parts together to make them more useful.
Deals with making or producing products
Involves making products that consumers need, want, and value
Example: zipper, thread, cloth put together = jacket
A jacket is valuable to a consumer.
Special features or ingredients in a product add value (increase form utility).

19. 2) PLACE UTILITY
Place utility: having a product where customers can buy the product.
Examples: online, catalogs, retail stores
Businesses study consumer shopping habits to determine the most convenient and efficient locations to sell products.

20. 3) TIME UTILITY
Time utility: having a product available at a certain time of year or a convenient time of day.
Examples: OPEN 24 HOURS, extended holiday hours
Marketers increase the value (increase time utility) of products by having them available when consumers want them.

21. 4) POSSESSION UTILITY
Possession utility: the exchange of a product for money.
Possession utility is involved every time legal ownership of a product changes hands.
Retailers may accept cash, personal checks, debit, or credit cards.
Each of these options add value (increase possession utility) to the product being purchased.

22. 5) INFORMATION UTILITY
Information utility: communication with the consumer.
Businesses can communicate with customers through salespeople, displays, packaging, labeling, Web sites, and advertising.
Examples: frozen food label, owners manual.

23. THE IMPORTANCE OF MARKETING
Our goals for this section were to:
Analyze the benefits of marketing
Apply the concept of utility
Marketing plays and important role in the economy because it provides a means for competition to take place.

24. FUNDAMENTALS OF MARKETING
Our goals for the next section are to:
Describe the concept of market
Differentiate consumer and industrial markets
Describe market share
Define target market
List the four components of the marketing mix

25. FUNDAMENTALS OF MARKETING
Marketers know that their product or service cannot appeal to everyone.
To do their job, they look for people who might have an interest in or a need for their product. These people often share similar needs and wants.
All people who share similar needs and wants and have the ability to purchase a given product are called a market.

26. TYPES OF MARKETS
A market can be described as a consumer market or industrial market.
Consumer market: consists of consumers who purchase goods and services for personal use.
Consumers want products that:
Save them money
Make their lives easier
Improve their appearance
Create status in the community
Provide satisfaction

27. TYPES OF MARKETS
Industrial market or business-to-business (B-to-B) market: includes all businesses that buy products for use in their operations.
Businesses want products that:
Improve profits
Improve productivity
Increase sales
Decrease expenses
Make their work more efficient

28. MARKET SHARE
A market is further described by the total sales in a product category.
Market share: a company’s percentage of the total sales volume generated by all companies that compete in a given market.

29. MARKET SEGMENTATION
Businesses look for ways to offer their product or service to the people who are most likely to be interested.
You already know that a market can be segmented into a consumer and industrial market. Within those markets, you can break it down even further.
Market segmentation: the process of breaking down larger markets into even smaller groups that have similar needs.

30. TARGET MARKET
Target market: the group that is identified for a specific marketing program.
Target markets are important because all marketing strategies are directed towards them.
If a business does not identify a target market, its marketing plan will have no focus.

31. Consumer Market Segment 1 Segment 2 TARGET MARKET Segment 3 Segment 1

32. TARGET MARKET A product may have more than one target market.
Example: Manufacturers of children’s cereal have two target markets.
1) Children (consumers): will be asking for the cereal and eating the cereal.
2) Parents (customers): will approving of and purchasing the cereal.

33. CUSTOMER PROFILE
To develop a clear picture of their target market, businesses create a customer profile.
Customer profile: lists information about the target market such as:
Age
Income level
Ethnic background
Occupation
Attitudes
Lifestyle
Geographic residence

34. MARKETING MIX Product Place Price Promotion
After a business has identified its target market and created a customer profile, they will develop the marketing mix.
The marketing mix includes four basic marketing strategies called the four Ps:
PRODUCT
PLACE
PRICE
PROMOTION
Marketing Mix
Product
Place
Price
Promotion

35. PRODUCT
Product: choosing what products to make and sell and the design of products.
Product decisions include:
Naming the product
Deciding how to match the target market’s needs
Tropicana’s Trop50 brand has 50% less sugar and calories and no artificial sweeteners.
Made for a target market with a balanced living, health conscious lifestyle.

36. PLACE
Place: the means of getting the product into the consumer’s hands or deciding how and where a product will be distributed.
Knowing where one’s customers shop helps marketers make the place decision.
Trop50 has been available nationwide. The Tropicana website has a store locator. Since most people shop in supermarkets for orange juice, the place decision was super easy.

37. PRICE Price: pricing strategies should reflect what
customers are willing
and able to pay.
Pricing decisions take
into account prices that
the competition charges
for comparable products.
To be competitive,
Tropicana priced its
Trop50 brand in line with
other premium orange
juices.

38. PROMOTION Promotion: activities related to advertising,
personal selling, sales
promotion, and
publicity.
Promotional strategies
deal with how potential
customers will be told
about a company’s
products, including the
message, the media
selected, special offers,
and the timing of the
promotional campaign.

39. FUNDAMENTALS OF MARKETING
Our goals for this section were to:
Describe the concept of market
Differentiate consumer and industrial markets
Describe market share
Define target market
List the four components of the marketing mix

40. Marketing Is All Around Us
SO WHAT IS MARKETING?
Chapter 1