Marketing 1 Marketing an organizational function and a set of processes for creating capturing communicating and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders Creating value o Production Oriented Era manufacturers were more concerned with product innovation not with satisfying the needs of individual consumers and retail stores were considered places to hold the merchandise until a consumer wanted it o Sale Oriented Era overproduction led to heavy doses of personal selling and advertising o Market Oriented Era manufacturers began to focus on consumer wants and needs before they designed made or attempted to sell their products and services o Value Based Marketing Era give customers greater value than competitors beyond just meeting the needs and wants of consumers Value reflects the relationship of benefits to cost or what you get for what you give Value Co creation method of providing additional value to customers by allowing them the opportunity to act as collaborators in creating the product or service About satisfying customer needs and wants o Marketplace needs to be segmented or divided into groups so that the organization can target specific groups Entails an exchange result consumers o Exchange the trade of things of value between the buyer and the seller so that each is better off as a o Sellers provide products or services then communicate and facilitate the delivery of their offering to o Buyers complete the exchange by giving money and information to the seller Requires product price place and promotion decisions o Product creating value by developing a variety of offerings including goods services and ideas to satisfy customer needs o Price capturing value everything the buyer gives up money time energy in exchange for the product The key of determining prices is to figure out how much customers are willing to pay and assess whether a profit can be made at that point o Place delivering the value proposition represents all the activities supply chain management necessary to get the product to the right customer when that customer wants it Supply Chain Management the set of approaches and techniques that firms employ to efficiently and effectively integrate their suppliers manufacturers warehouses stores and other firms involved into a seamless value chain in which merchandise is produced and distributed in the right quantities to the right locations and the right time while minimizing system wide costs and satisfying the service levels required by the customer o Promotion communicating the value proposition to potential customers informs persuades and reminds potential buyers about a product or service to influence their opinions and elicit a response generally enhances a product s value Can be performed by individuals and organizations o B2C Marketing Business to Consumer o B2B Marketing Business to Business o C2C Marketing Consumer to Consumer Occurs in many settings Impacts Various Stakeholders o Employment Marketing programs to attract the best and brightest employees involves undertaking marketing research to understand what potential employees are seeking and what they think about the firm developing a value proposition and an employment brand image communicating that brand image to potential employees and then fulfilling the brand promise by ensuring the employee experience matches that which was advertised Key Questions Marketers Ask o What triggers the decision to buy o Who in the family makes the decision to buy o Who actually buys o Where does the person buy o What features do users want in a new product that might make them switch from an old product Advantages of Marketing o Seeks to be successful by focusing on satisfying consumer desires o Tries to deliver customers what they want when they want it and at a price they are willing to pay o Informs consumers of important products o Provides product details to consumers for more informed decisions making o Advertising can deliver important cultural messages Disadvantages of Marketing o Marketing communications are not always honest o Youth may be targeted by companies selling adult products o Some ads are crude o Advertising emphasizes an unattainable image o Preaches that buying things makes you happy o Sometimes takes advantage of consumer s lack of knowledge buyer beware Importance of Marketing o Expands Global Presence o Pervasive across organizations o Pervasive across supply chain o Makes life easier o Enriches society Corporate Social Responsibility CSR Voluntary actions taken by a company to address the ethical social and environmental impacts of its business operations and the concerns of its stakeholders o Can be entrepreneurial Value Based Marketing Value driven companies Share information across their organization and with other firms that help them in getting the product or service to the marketplace Balance customer s benefits and costs Build relationships with customers o Measure the benefits that customers perceive against the cost of their offerings o Transactional Orientation regards the buyer seller relationship as merely a series of individual transactions so anything that comes before and after the transaction is of little important o Relational Orientation based on the philosophy that buyers and sellers should develop a long term relationship o Customer Relationship Management CRM a business philosophy and set of strategies programs and systems that focus on identifying and building loyalty among the form s most valued customers systematically collect information about their customer s needs and then use that information to target their best customers with products services and special promotions that appear most important to these customers Must understand what customers view as the key benefits of given product or service and how to improve on them Marketing 2 Marketing Strategy identifies a firm s target market s a related marketing mix their 4 P s and the bases upon which the firm plans to build a sustainable competitive advantage Marketing Tactics detailed day to day operational decisions essential to the overall success of marketing strategies Sustainable competitive advantage an advantage over the competition that is not easily copied and thus can be maintained over a long period of time Building a wall around its position in the market Over time all advantages will be eroded by competitive