1. Instructor: Amir Ekhlassi (1) Defining Marketing for the 21 st century

2. What is marketing? Simply put: Marketing is the delivery of customer satisfaction at a profit. exchanging Marketing is a social and managerial process whereby individuals and groups obtain what they need and want through creating and exchanging products and value with others. 2 © Compiled by: Amir Ekhlassi

3. Marketing importance and role Production sector Heterogeneous supply capabilities consumption sector Heterogeneous demand for form, time, place, and possession utility Marketing Needed To overcome Discrepancies And Separations Spatial separation Separation in time Separation of information Separation in values Separation of ownershipDiscrepancies of quantity Discrepancies of assortment 3 © Compiled by: Amir Ekhlassi

4. Core concepts of Marketing Needs, wants, demands Products, services, and experiences Value, satisfaction, and quality Exchange, transaction, and relationships Markets 4 © Compiled by: Amir Ekhlassi

5. Needs, wants, and Demands Human needs are states of felt deprivation. They are basic human requirements. These needs were not invented by marketers; they are a basic part of the human makeup. Wants are the form human needs take as they are shaped by culture and individual personality. Wants are shaped by one’s society. Demands: human wants that are backed by buying power. 5 © Compiled by: Amir Ekhlassi

6. Products, services, and experiences A product is anything that can be offered to a market to satisfy a need or want. It includes physical objects, services, persons, places, organizations, and ideas. Thus the term product includes more than just the physical properties of a good or service. It also includes a brand’s meaning to consumers. The term product also includes more than just goods or services. Consumers decide which events to experience, which entertainers to watch on TV, which places to visit on vacation, which organizations to support through contributions, and which ideas to adopt. To the consumer, these are all products. 6 © Compiled by: Amir Ekhlassi

7. Products, services, and experiences (cont’d) Service: an activity or benefit that one party can offer to another that is essentially intangible, and does not result in the ownership of anything. 7 © Compiled by: Amir Ekhlassi

8. Value, satisfaction, and quality Customer value: is the difference between the values the customer gains from owning and using a product and the costs of obtaining the product. Customers often do not judge product values and costs accurately or objectively. They act on perceived value. Value proposition: a set of benefits to satisfy needs Value = Benefits / Costs = (functional benefits + emotional benefits) / (monetary costs + time costs + energy costs + psychic costs) Customer satisfaction: depends on a product’s perceived performance in delivering value relative to a buyer’s expectations. If the product’s performance falls short of the customer’s expectations, the buyer is dissatisfied. If performance matches expectations, the buyer is satisfied. If performance exceeds expectations, the buyer is delighted. 8 © Compiled by: Amir Ekhlassi

9. Value, satisfaction, and quality (cont’d) Note: a company can always increase customer satisfaction by lowering its price or increasing its services, but this may result in lower profits. Thus, the purpose of marketing is to generate customer value profitably. This requires a very delicate balance: the marketer must continue to generate more customer value and satisfaction but not “give away the house”. 9 © Compiled by: Amir Ekhlassi

10. Value, satisfaction, and quality (cont’d) In the narrowest sense, Quality can be defined as “freedom from defects”. Marketers have two major responsibilities in a quality-centered company. first, they must participate in forming strategies that will help the company with through total quality excellence. Second, marketers must deliver marketing quality as well as production quality. 10 © Compiled by: Amir Ekhlassi

11. Exchange, transaction, and relationships Exchange: the act of obtaining a desired object from someone by offering something in term. Transaction: a trade between two parties that involves at least two things of value, agreed upon conditions, a time of agreement, and a place of agreement. : Relationship marketing: the process of creating, maintaining, and enhancing strong, value-laden relationships with customers and other stakeholders. 11 © Compiled by: Amir Ekhlassi

12. Marketing and exchange exchange Marketing (Kotler, 1980): human activity directed as satisfying needs and wants through exchange processes. Exchange is the core concept of marketing Exchange is a value creating process because it leaves both parties better off. There are at least two parties. Each party has something that might be of value to the other party. Each party is capable of communication and delivery. Each party believe it is appropriate or desirable to deal with the other party. The focal point in an exchange is marketing offer combination of products, services, information, or experience that satisfy a need or want. 12 © Compiled by: Amir Ekhlassi

13. Markets Economists describe a market as a collection of buyers and sellers who transact over a particular product or product class. Marketers often use the term market to cover various grouping of customers. Market: the set of all actual and potential buyers of a product or service. 13 © Compiled by: Amir Ekhlassi

14. Key customer markets Consumer markets Global markets Business markets Nonprofit/government Markets 14 © Compiled by: Amir Ekhlassi

15. What is marketed? goods services Events Experience persons Places & properties Ideas Organizations 15 © Compiled by: Amir Ekhlassi

16. Marketing management Marketing management: is the analysis, planning, implementation, and control of programs designed to create, build, and maintain beneficial exchanges with target buyers for the purpose of achieving organizational objectives. Marketing management is concerned not only with finding and increasing demand but also with changing or even reducing it. (Demand management) Demarketing: marketing to reduce demand temporarily or permanently- the aim is not to destroy demand but only to reduce or shift it. 16 © Compiled by: Amir Ekhlassi

17. Marketing management: the newest definition Marketing management is the art and science of choosing target markets, and getting, keeping, and growing customers through creating, delivering, and communicating superior customer value. 17 © Compiled by: Amir Ekhlassi

18. Marketing management practice In fact, marketing practice often passes through three stages: 1. Entrepreneurial marketing: most companies are started by individuals who live by their wits. They visualize an opportunity and knock on every door to gain attention. 2. Formulated marketing: as small companies achieve success, they inevitably move toward more formulated marketing. 3. Intrepreneurial marketing: many large and mature companies need to reestablish within their companies the entrepreneurial spirit and actions that made them successful in the first place. They need to encourage more initiative and “ Intrepreneurial” at the local level. 18 © Compiled by: Amir Ekhlassi

19. Marketing management tasks Developing marketing strategies Capturing marketing insights Connecting with customers Building strong brands Shaping market offerings Delivering value Communicating value Creating long-term growth 19 © Compiled by: Amir Ekhlassi

20. Marketing management philosophies Production Concept Product concept Selling concept Marketing concept Societal marketing concept 20 © Compiled by: Amir Ekhlassi

21. Production and product orientation Production orientation: It holds that consumers will prefer products that are very cheap and widely available. High volume, production efficiency, basic features, mass distribution. Product orientation: It holds that consumers will favor those products that offer the most quality, performance or innovative features. Making superior products and improve it. 21 © Compiled by: Amir Ekhlassi

22. Selling concept It holds that consumers will ordinary not buy enough of the organization’s product. The company should undertake aggressive selling and promotion efforts. Sell more stuff to more people more often for more money in order to make more profit. The aim is to sell what we make rather than making what market wants. 22 © Compiled by: Amir Ekhlassi

23. Marketing orientation Instead of product or selling, it focuses on customers. Instead of hunting, marketing is gardening The job is not to find the right product for your customers. Being more effective than competitors in creating, delivering and communication superior customer value to the target market. 23 © Compiled by: Amir Ekhlassi

24. Marketing and sales concepts contrasted factory Existing products Selling And promoting Profits through Sales volume market Customer needs Integrated marketing Profits through Customer satisfaction Starting point focusmeans ends 24 © Compiled by: Amir Ekhlassi

25. The societal marketing concept Societal marketing concept: the idea that the organization should determine the needs, wants, and interests of target markets and deliver the desired satisfaction more effectively and efficiently than do competitors in a way that maintains or improves the consumer’s and society’s well-being According to the societal marketing concept, the pure marketing concept overlooks possible conflicts between consumer short-run wants and consumer long-run welfare. 25 © Compiled by: Amir Ekhlassi

26. The societal marketing concept (cont’d) The societal marketing concept calls on marketers to balance three considerations in setting their marketing policies: company profits, consumer wants, and society’s interests. Societal Marketing Concept Society (human welfare) Consumers (want satisfaction) Company (profits) 26 © Compiled by: Amir Ekhlassi

27. George Day’s Market driven concept market driven What does it mean to be market driven? = superior skills in understanding, attracting, and keeping valuable customers. 27 © Compiled by: Amir Ekhlassi

28. Misconceptions about Market orientation Self centered companies: Advantage comes from controlling assets or achieving functional excellence. Technology determines benefits offered. Incapability of capturing and sharing market insight. Customer compelled companies: Try to be all things to all people=no priorities in segments served or benefits offered. Each function gets different inputs from customers and reacts separately = lack of functional integration Skepticism Leading customers or following customers Technology push or market pull 28 © Compiled by: Amir Ekhlassi

29. What does it mean to be market driven? (cont’d) Distinctive capabilities and behaviors: Offering superior solutions and experiences Focusing on superior customer value Converting satisfaction to loyalty Energizing and retaining employees Anticipating competitors’ moves Viewing marketing as an investment, not a cost Nurturing and leveraging brands as assets 29 © Compiled by: Amir Ekhlassi

30. Kotler’s holistic marketing concept Companies need a fresh thinking about how to operate in new environment. holistic marketing The holistic marketing is based on development, design, and implementation of marketing program, processes and activities that recognizes their breadth and interdependence. 30 © Compiled by: Amir Ekhlassi

31. Holistic marketing Holisticmarketing Integrated marketing Relationship marketing Internal marketing Socially Responsible marketing channels Products & services communications Other departments Senior management Marketing Department partners Channels customers communityLegal & ethicsEnvironment 31 © Compiled by: Amir Ekhlassi

32. Thank You For Your Patience & Attention 32