1. Overview of Marketing Class 23 Tuesday 11/15/11

2. Nature of Marketing To create value by allowing people and organizations to obtain what they need and want

3. The Exchange Process: Giving Up One Thing for Another

4. Marketing Creates Utility Utility—the ability of a a product or service to satisfy human needs and wants –Place –Time –Ownership –Form

5. Evolution of the Marketing Concept The production orientation –During the second half of the 19th century The sales orientation –By the early part of the 20th century The marketing orientation –By the 1950s

6. Marketing Orientation Requires organizations to: –Gather information about customer needs –Share that information throughout the entire firm –Use that information to help build long-term relationships with customers

7. Developing Marketing Strategy Marketing strategy: –A plan of action for developing pricing, distributing and promoting products that meet the needs of specific customers Two major components: –Selecting a target market –Developing the appropriate marketing mix

8. Selecting a Target Market Market –A group of people who have a need, purchasing power, and the desire and authority to spend money on goods, services, and ideas Target market –A more specific group of consumers on whose needs and wants a company focuses its marketing effort

9. Target Market Strategies Total-Market Approach

10. Further Refinement Market Segment –A collection of individuals, groups, or organizations who share one or more characteristics and have similar product needs and desires Niche Market –Narrow market segment focus when efforts are on one small, well-defined segment that has a unique, specific set of needs

11. The Keys to Successful Market Segmentation 1.Consumers ’ product needs must be heterogeneous 2.Segments must be identifiable and divisible 3.The market must be divided so segment sales, cost, and profit can be compared 4.One segment must have enough profit potential to justify a special marketing strategy 5.The chosen segment must be reached by the firm with a particular marketing strategy

12. Marketing Research & Information Systems Marketing research –A systematic, objective process of getting customer information to guide marketing decisions Marketing information system –A framework for assessing information about customers from internal and external sources

13. Collecting Data Primary data –Marketing information that is observed, recorded, or collected directly from respondents Secondary data –Information that is compiled inside or outside an organization for some purpose other than changing the current situation

14. Influences On Buying Behavior PsychologicalMotivationPerceptionLearningAttitudesPersonality SocialFamilyReferenceGroups Economic or Social Status Culture

15. The Marketing Mix and the Marketing Environment

16. The 4 P’s Product: A good, service, or idea that has tangible and intangible attributes that provide satisfaction and benefit to consumers –Products should be sold at a profit Price: A value placed on a product or service that is exchanged between a buyer and seller Place (Distribution) : Making products available to consumers in the quantities and locations desired Promotion: A persuasive form of communication that attempts to expedite a marketing exchange by influencing individuals and organizations to accept goods, services, and ideas

17. Product - Life Cycle

18. Introduction Stage & Marketing Mix  Product Awareness  Limited Competition  Skim-Pricing Approach  Few Channels

19. Growth Stage & Marketing Mix  Building Sales  Competition = Lowering Prices  Multiple Channels  Profitable

20. Maturity Stage & Marketing Mix  Sales Grow At Decreasing Rate  Differentiate from Competition  Price Wars  Profits Up With Sales  Changing Consumer Preferences

21. Decline Stage & Marketing Mix  Demand Down  Intense Price Competition  Profits Low Or Losses  Revitalize Or Pull Product

22. Pricing - Product Pricing New $ Skimming $ Penetration Other $ Cost-Based $ Demand-Based $ Target Costing $ Prestige $ Odd-Even

23. Place - Distribution Intermediary – “ …a wholesaler or retailer who helps move products from their original source to the end user… ” Each intermediary in the channel of distribution requires a profit margin, thus increasing the cost of the product.

24. Distribution Channels

25. The Supply Chain

26. Value Chain “ …the entire range of activities involved in delivering value to customers… ”

27. Promotion Mix “ …the means by which (companies) communicate with customers… ”

28. Considerations Before Selecting Promotional Strategy  Purpose of Promotion?  Target Market?  Product Features to Emphasize?  Afford?  Similar to Competitors?

29. Promotional Tools Advertising PersonalSelling SalesPromotion Publicity & Public Relations

30. Promotion - Branding Promotion - Branding “ …word, letter, sound, or symbol that… differentiate(s)… products on the market. ” Trademark – “ …register(ed) name with the U. S. Patent and Trademark Office. ” U.S. Patent & Trademark Website R

31. Branding Strategies  Private Branding  Generic Branding  Manufacturer Branding

32. Branding Equity & Loyalty Equity – Value of a brand generated by a favorable consumer experience with a product or service Loyalty – Consumer preference for a particular product or service that develops over time based on satisfaction with the company’s products or services

33. Packaging/Labeling Packaging - “ …container that holds…(the) product. ” Labeling – “ …what… (is said) about the product on… (the) packaging. ”