Marketing NoteWHAT IS MARKETING?CHAPTER 1 Marketing is the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large.-American Marketing AssociationPAGE 5 Marketing Mix (4P’s) Product: Creating Value Collaboration with suppliers & customers Create  Price: Capturing Value Trading value for offerings Place: Delivering Value Get offerings to consumer In a way that optimizes value Promotion: Communicating Value Profitable Exchange Personal Value Equation  Value = Benefits Received – (Cost + Hassle) Marketing Concept Philosophy underlying everything marketers do  Seek to satisfy customer needs & wants Value Fundamental purpose of marketing: Create value- Benefits Firms, Partners, Customers & Society Value-Based Marketing Balance benefits with costs Offer excess Share information Build relationships History of Marketing’s Role Production-oriented era Sales-oriented era Market-oriented era after WW2 Value-based marketing era now Value co-creation Who Engages in Marketing? For-profit companies Defined by customers Defined by function Nonprofit Organizations Marketing is NOT? Just buyers and sellers exchanging money Simply about making a profit Ethical implications A random activity The marketing planDEVELOPING MARKETING STRATEGIES & A MARKETING PLANCHAPTER 2 Strategic Planning Within the Firm Corporate level plans Top executives Business level plans Strategic business units Functional level plans DepartmentalGoals need to cleanly defined and measureable  Strategic Planning Process Document: Marketing Plan Function: Allocate resources Goals: Accomplish objectives Deliver value Be competitive Marketing Plan: Step 1 Define the Business Mission Mission Statement Purpose of the organization Type of business  Goals and objectives to accomplish- Sustainable competitive advantage Competitive advantage V- something of value I- difficult to imitate R- rare in the marketplace O- organization can support it Competitive advantage Customer excellence Company culture Intellectual property Operational excellence Product excellence Locational excellence Social responsibility Step 2: Situation Analysis Assessment of organization’s internal & external environment Tool: SWAT Analysis Strengths Weakness Opportunities Threats Step 3: Identifying & Evaluating Opportunities Using STP Segmentation Divide the marketplace Targeting  Evaluate attractiveness Positioning Define the marketing mix Step 4: Implement Marketing Mix & Allocate Resources Place Product Promotion Price Step 5: Evaluate Performance Using Marketing Metrics Setting /benchmarks for Success Accountability Objectives & Metrics Portfolio analysis- The Boston Consulting Group MatrixMarketGrowthRateRelative Market Share Growth StrategyProducts and ServicesMarkets Current NewCurrent Market Penetration Product DevelopmentNew Market Development Diversification Downsizing Eliminate products Abandon marketsStars Question MarksCash Cows DogsANALYZING THE MARKETING ENVIRONMENTCHAPTER 5 Immediate Environment  Company capabilities Tangible Resource- Financial, physical, technological Intangible Resource- Brand reputation, culture, intellectual property Human Resources- Skills and incentives Global Resources- International labor, International offices, International distribution Competitors Identify competitors- Direct- Indirect Competitive intelligence Proactive vs. Reactive Corporate Partners Firms are not of alliances Align with competitors, supplies, etc. Microenvironment Culture Shared meanings, beliefs, values, morals, customs- Country culture- Regional culture Macroenvironment Demographics Generational cohorts- Baby Boomers- Gen X- Gen Y Millennial- Gen Z Income- Tied to purchasing power- Middle class in decline Education- Tied to income & occupation Gender- Male/Female roles Ethnicity - 2050- 2010 Census Social Trends Societal issues, values, concerns that help to shape culture- Green movement- Privacy concerns- Time-poor society- Fair labor/wages- Price sensitivity/thrift- Heath &wellness concerns Technological Advances Improves value of products/ services- New products- New forms of communication- New retail channels Economic Situation Affects how consumers buy Affects how many is spent Examples:- Inflation- Unemployment “altruism marketing”- Interest rates Political/Regulatory Environment Components- Political Parties- Government Organizations- Legislation & Laws Implications- Dictates legal competitive practices- Consumer protection- Industry-specific regulations Political/Regulatory Environment- 1890 Sherman Act- 1914 Clayton ActCONSUMER BEHAVIORCHAPTER 6 Consumer Behavior Sociology & psychology Understand consumer actions Develop basic strategies Types of Problem Solving Degree of Involvement Low- Limited problem solving Impulse Habitual High - Extended problem solving Step 1: Need Recognition  Stimuli- Internal- External Needs- Functional- Psychological- Functional Psychological Step 2: Information Search Internal External Factors affecting information Search- Perceived benefits vs cost of search- Locus of control- Actual or perceived risk Step 3: Evaluation of Alternatives Attribute sets- Universal sets Retrieval sets Evoked Inert Inept Evaluation criteria- Determinant attributes- Decision heuristics Step 4: Purchase Decision and Consumption Choice made Value Step 5: Post-purchase Behavior Customer Satisfaction Post-purchase Cognitive Dissonance Customer Loyalty Negative Word of Mouth Factors influencing the Consumer Decision Process 1. Psychological Factors Motives Attitude- Cognitive- Affective- Behavioral Perception Learning Lifestyle 2. Social Factors Family Reference groups Culture 3. Situational Factors Purchase situation Shopping situation Temporal situationSelf-fulfillmentEsteemSocialSafetyPhysiologicalBUSINESS-TO-BUSINESS MARKETINGCHAPTER 7