What is marketing Marketing is a social and managerial process by which individuals and organizations obtain what they need and want through creating and exchanging value with others Marketing is the delivery of customer satisfaction at a profit Goal 1 attract new customers by promising superior value Goal 2 retain and grow current customers by providing satisfaction Needs state of felt deprivation i e I am hungry Wants needs shaped by culture and individual personality i e I want a hamburger fries or soft drink Demands wants backed by buying power i e I have money to buy this meal What will satisfy customer needs and wants Market offering some combination of products services information or experiences offered to a market to satisfy a need or want Marketing Myopia focusing on a specific product more than benefits or experiences How do customers choose among products and services Customer value benefit that a customer gains from using a product compared to the cost of obtaining a product Customer satisfaction depends on the products perceived performance in delivering value relative to a buyer s expectations How do consumers obtain products and services Exchange Transactions Relationships Who purchases products Market buyers who share a particular need or want that can be satisfied by a company s products or services Broken down into actual buyers current users and potential buyers new Marketing management orientation Production concept Consumers will buy products that are available and affordable Consumers favor products that offer the most quality innovation and performance Product concept Selling Concept Consumers will buy products only if the company promotes and sells these products Profit through sales in volume Marketing Concept Focus of needs wants of target segment and delivers satisfaction better than competitions Profit through customer satisfaction Societal marketing concept Focus of needs wants of target segment and delivers superior value in a broader context long run interests Customer Relationship Management CRM The overall process of building and maintain profitable relationships by delivering superior customer value and satisfaction It costs 5 to 10 times more to attract new customers than it does to keep a current customer satisfied Marketers must be concerned with the lifetime value of the customer Customer satisfaction customer loyalty Lifetime value Chapter 2 Strategic Planning The managerial process of developing and maintaining a strategic fit between the organizations objectives and the recourses and the changing market opportunities 1 Define companies mission which must be customer focused 2 Define goals and objectives 3 Design a portfolio that aligns with these goals Define a MARKET ORIENTED MISSION STATEMENT Based on customers needs Motivating meaningful and specific Not stated in sales and profits Matching question on page 40 table 2 1 Emphasize companies strengths in market place Setting corporate goals Corporate goals convert the mission into targeted levels of performance measurable means of how well a mission is being accomplished profit examples market share revenue quality customer satisfaction Mission statement leads to 1 must be measurable 2 detailed supporting objectives for each level of management 3 a pathway for building a portfolio Business Portfolio a collection of businesses and products that make up a company BCG Growth Share matrix Star Cash cow Question mark Dog Star High growth high share often need heavy investment to finance rapid growth will eventually slow down and become cash cow Cash Cow low growth high share established need less investment provide a lot of cash that s used to pay bills and support others Question Mark high growth low share require a lot of cash Dog low growth low share don t generate enough cash to maintain themselves Know whether to hold divest or invest in each Strategies for growth and downsizing Market penetration existing market existing products Market development new market existing products Product development existing market new products Diversification new market new products Value chain series of internal departments that carry out value creating activities to design produce market deliver and support the firm s products partnering to build customer relationships internal value chain value delivery network improves performance of the entire system Integrating marketing mix 4 P s 1 product 2 price 3 promotion 4 place Questions marketers ask Who will we serve How will we create value for them Market segmentation the process of dividing a market into distinct groups of buyers who have distinct needs characteristics or behaviors who might require separate products or marketing programs Market targeting involves evaluating each market segments attractiveness and selecting one or more to enter and prioritizing them Positioning arranging for a product to occupy a clear distinctive and desirable place relative to competing products in the minds of consumers SWOT Analysis Strengths Weaknesses Opportunities Threats ROI Return on marketing investment Net return on marketing investment divided by costs of the marketing investment Chapter 3 Marketing environment the actors and forces outside marketing that affect the marketing managers ability to build and maintain successful relationships with customers o Microenvironment actors close to the company The company work with other sectors of the company and relate to broader goals and strategies matching in slides of functions of each sector of the company Suppliers must keep eye on availability and pricing Customers consumers business reseller gov t international Most important actors in the microenvironment Marketing intermediaries those who promotes sell or distribute final products to final users I e resellers physical distribution firms marketing agencies and financial intermediaries Competitors an entity with which the company competes with for resources sales etc Publics an group that has an actual or potential interest in the impact on the organization I e financial media gov t citizen s action neighborhood residents community orgs General public internal public Macroenvironment societal forces Demographic forces study of human population in terms of size age density location gender race occupation and other stats o Change in age structure getting older before 1946 27 of pop born between 46 and 64 28 of pop born between 65 and 76 17 of pop Seniors Baby