Marketing An Introduction

Marketing Defined

Markets  Set of actual and potential buyers  Potential markets for…????? Textbooks Sporting event tickets Hiking boots Sports enhancement facilities BMW

Mass Marketing  Seller mass produces, mass distributes & mass promotes one product to all buyers Examples???  Weaknesses of mass marketing for non- mass products

Market Segmentation  Divides a heterogeneous group into smaller homogenous segments  Groups have similar wants & responses  Basic to all marketing efforts Better than mass marketing. Why?

Target Marketing  Seller identifies market segments, selects 1 & develops products and marketing mixes for them Marketing Mix – product, price, place, promotion (4 P’s)

4 Bases of Segmentation 1. Demographics 2. Psychographics 3. Product usage 4. Product benefits

Demographics  Geography Proximity – closeness to location Geoclusters

Demographics  Income Determines lifestyle Influences advertising market for certain products  Age One of the most effective variables  Age & stage of lifecycle similar Income, education, family lifecycle

Demographics  Age Mature Market – 55+  Stereotyped as inactive & thrifty – untrue!  Living longer & more active  23% are over 55…. & have 75% of the wealth & 50% of the discretionary income Per capita income is 25% higher than national average Spends 1+ trillion per year on goods & services  Senior discounts

Demographics  Gender  Race Shared genetic make-up, biological differences  Ethnicity Commonalities passed down through history & tradition, culture, morals, beliefs

Demographics  Sexual Orientation Higher income & education HeterosexualLGBT Median household income$43,318$70,000 College degrees30%37% Graduate degrees9.4%28%

Demographic Descriptors for Consumer Markets AgeUnder 6; 6-11; 12-19; 20-34; 35-49; 50-64; 65+ Family size1-2; 3-4; 5+ Family lifecycleYoung & single; young, married, no children; young, married, youngest child under 6; young, married, youngest child 6 or over; older married, with children; older married, no children under 18; older single; other IncomeUnder $10,000; $10,000-$15,000; $15,000-$20,000; $20,000- $30,000; $30,000-$50,000; $50,000-$100,000; $100,000+ OccupationProfessional & technical; managers, officials, & proprietors; clerical, sales; craftspeople, foremen; operatives; farmers; retired; students; housewives/husbands; unemployed EducationGrade school or less; some high school; high school graduate; some college; college graduate; post graduate work; post graduate degree RaceAfrican American; American Indian; Asian; Caucasian; Hispanic; other NationalityAmerican; British; French Canadian; German; Italian; Japanese; Australian; Latino Social classLower lowers; upper lowers; working class; middle class; upper middles; lower uppers; upper uppers

Psychographics  Lifestyle characteristics ActivitiesInterestsOpinions WorkFamilySocial issues HobbiesHomePolitics Social eventsJobBusiness VacationCommunityEconomics EntertainmentRecreationEducation Club membershipFashionProducts Shopping preferencesFoodFuture SportsMediaCulture

Psychographics  How do we use these? Meijer’s coupons Shows at Braden Club membership – campus, fitness Political affiliation Donations Activities – biking, running Professional associations

Product Use  Use rates Frequency Ability Specialization

Product Benefits Segmentation  Divide by desired benefits  What do the following want from a tennis shoe? Runner Avid walker Cycler

Promotions Defined  Communication designed to facilitate exchanges with members of potential client groups by communicating the benefits offered by the program/service.

Promotions Mix Advertising Sales Promotions & Incentives Personal Selling Publicity

Personal Selling  Using direct, face to face oral presentation for the purpose of facilitating exchange

Sales…  Sponsors  Service clubs  Every day participants  Media

Personal Selling  Expensive but allows for relationship marketing Build relationship with the customer  Allows for benefit selling Can create new benefits to offset negativity toward product

Promotions Mix Advertising Sales Promotions & Incentives Personal Selling Publicity

Sales Promos & Incentives  Something of financial or non-financial value offered to encourage participation Free offers Promotional pricing Celebrities Prizes