CHAPTER 13 MARKETING Marketing 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 o Or more simply the activities buyers and sellers perform to facilitate mutually satisfying exchanges o Marketing today is all about helping the buyer buy o Helping the buyer buy also helps the seller sell o Marketing in the US has passed through four eras 1 Production era 1900s the gen philosophy was to produce as much as you can because there is a limitless market for it a Mostly farmers carpenters trade workers oil 2 Selling era 1920s developed mass production techniques auto assembly lines Production capacity often exceeded the immediate market demand 3 Marketing concept era after WWII in 1945 baby boom and a boom in consumption Comp for consumer s dollar was fierce 1950s created a philosophy called the marketing concept 4 Customer relationship era CRM Marketing concept a three part business philosophy o 1 a customer orientation 2 a service orientation 3 a profit orientation 1 Customer orientation find out what consumers want and provide it for them 2 Service orientation make sure everyone in the organization has he same objective customer satisfaction 3 Profit orientation the focus on goods and services that will earn the most profit and enable the organization to survive and expand to serve more consumer wants and needs o 1980s businesses began to apply the marketing concept more aggressively which led to a focus on customer relationship management Customer relationship management CRM 1990s 2000s the process of learning as much as possible about customers and doing everything you can to satisfy them or even exceed their expectations with goods and services o Its purpose is to stimulate long term customer loyalty o Newest CMR efforts is customer managed relationships CMR the idea is to give the customer the power to build relationships with suppliers The four P s to marketing 1 Product designing a want satisfying product 2 Price setting a price for the product 3 Place putting the product in a place where people will buy it 4 Promotion promoting the product Marketing mix the ingredients that go into a marketing program product price place promotion Product any physical good service or idea satisfies a want or need plus anything that would enhance the product in the eyes of consumers such as the brand Test marketing the process of testing products among potential users Brand name a word letter or group of words or letters that differentiates one seller s goods and services from those of competitors PRICING DEPENDS ON SEVERAL FACTORS o Close to what other restaurants or charging to stay competitive o Charge less to attract business especially at the beginning o Charge more for offering high quality products Starbucks o Consideration of costs to produce distribute and promote Getting the product to consumers when and where they want is critical to market success distribution from producers to consumers intermediaries or middlemen Promotion all the techniques sellers use to inform people about and motivate them to buy their products or services o Promotion includes advertising personal selling public relations publicity word of mouth viral marketing and various sales promotion efforts coupons rebates samples and cents off deals Marketing research the analysis of markets to determine opportunities and challenges and to find the information needed to make good decisions o Identifies previous purchases what changes have occurred to alter what they want now and what they re likely to want in the future o Business trends ecological impact of their decisions global trends etc Simplified marketing research process consist of at least four key steps 1 Defining the question problem or opportunity and determining the present situation 2 Collecting research data 3 Analyzing the research data 4 Choosing the best solution and implementing it Secondary data information that has already been compiled by others and published in journals and books or made available online Primary data data you gather yourself not from secondary sources such as books and magazines o Most common forms of primary data collection telephone surveys online surveys mail surveys and personal interviews Focus group a small group of people who meet under the direction of a discussion leader to communicate their opinions about an organization its products or other given issues Environmental scanning the process of identifying the factors that can affect marketing Consumer market all the individuals or households that want goods and services for success personal consumption or use Business to business B2B all the individuals and organizations that want goods and services to use in producing other goods and services or to sell rent or supply goods to others o B2B goods services oil drilling bits cash registers display cases office desks public accounting audits and business software Market segmentation the process of dividing the total market into groups whose members have similar characteristics o Geographic demographic psychographic benefit and volume segmentation Target marketing marketing directed towards those groups market segments an organization decides it can serve profitably Geographic segmentation dividing a market by cities counties states or regions Demographic segmentation dividing the market by age income and education level Psychographic segmentation dividing the market using the group s values attitudes Benefit segmentation dividing the market by determining which benefits of the product and interests to talk about Volume or usage segmentation dividing the market by usage volume of use Niche marketing the process of finding small but profitable market segments and designing or finding products for them o Long tail is a phrase by Chris Anderson companies selling more products with lower demand can easily compete with or even surpass those solely dependent on big sellers One to one marketing developing a unique mix of goods and services for each individual customer Mass marketing developing products and promotions to please large groups of people Relationship marketing marketing strategy with the goal of keeping individual customers over time by offering them products that exactly meet their requirements Decision making process for consumers 1 Problem recognition 2 Information search 3 Alternative
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