BMGT350 02 25 2012 Chapter 1 An Overview of Marketing Marketing Is the activity set of institutions and processes for creating communicating delivering and exchange of offerings that have value for customers clients partners and society at large Two Facets of Marketing A philosophy an attitude a perspective or a management orientation that stresses customer satisfaction An organizational activity set of institutions and processes 4 Marketing Management Philosophies Production Orientation Is a philosophy that focuses on the internal capabilities of the firm rather than on the desires and needs of the marketplace o If you build it they will come o Examples Apple the furniture industry Sales Orientation Is based on the idea that people will buy more goods and services if aggressive sales techniques are used and that high sales result in high profits o Fundamental problem is a lack of understanding the needs and wants of the marketplace o One of the dangers of a sales orientation is failing to understand what is important to the firms customers Marketing Orientation A philosophy that assumes that sale does not depend on an aggressive sales force but rather a customers decision to purchase a product It is synonymous with the marketing concept wants o Focusing on customer wants and needs to distinguish products from competitors offerings o Integrating all the organization s activities to satisfy these o Achieving the organization s long term goals by satisfying customer wants and needs legally and responsibly Societal Marketing Orientation The idea that an organization exists not only to satisfy customer wants and needs and to meet organizational objectives but also to preserve or enhance individuals and society s long term best interest Customer Value Is the relationship between benefits and the sacrifice necessary to obtain those benefits Marketers interested in customer value Offer products that perform earn trust avoid unrealistic pricing give the buyer facts offer organization wide commitment in service and after sales support and co creation Customer Satisfaction Customers evaluation of a good or service in terms of whether it has met the needs and expectations Relationship Marketing Is a strategy that focuses on keeping and improving relationships with current customers Successful strategies need Customer oriented personnel the role of training empowerment and teamwork Chapter 2 Strategic Planning for Competitive Advantage Strategic Planning Is the managerial process of creating and maintaining a fit between the organization s objectives and resources and the evolving market opportunities Goal Long term profitability growth and profit Marketing Planning Designing activities relating to marketing objectives and the changing marketing environment activities for the marketing manager Marketing Plan A written document that acts as a guidebook of marketing Mission Statement A statement of the firm s business based on a careful analysis of benefits sought by present and potential customers and an analysis of existing and anticipated environmental conditions Answers the question What business are we in Marketing Myopia Defining a business in terms of goods and services rather than in terms of the benefits customers seek Strategic Business Unit SBU A subgroup of a single business or collection of related businesses within the larger organization SWOT Analysis Indentifying internal strengths S and weaknesses W and also examining external opportunities O and threats T Environmental Scanning Collection and interpretation of information about forces events and relationships in the external environment that may affect the future of the organization or the implementation of the marketing plan Studies 6 major environmental forces Social demographic economic technological political legal and competitive Marketing Objective Is a statement of what is to be accomplished through marketing activities Should be Realistic measurable time specific and compared to a benchmark Competitive Advantage A set of unique features of a company and its products that are perceived by the target market as significant and superior to the competition Cost Competitive Advantage Being the low cost competitor in an industry while maintaining satisfactory profit margins Product Service Differentiation Competitive Advantage The provision of something that is unique and valuable to buyers beyond simply offering a lower price than that of the competition Niche Competitive Advantage The advantage achieved when a firm seeks to target and effectively serve a small segment of the market Sustainable Competitive Advantage An advantage that cannot be copied by the competition Sources of sustainable competitive advantages Patents copyrights locations equipment technology customer Market Penetration A marketing strategy that tries to increase market share service and promotion among existing customers customers to existing products products for present markets into new markets Market Development A marketing strategy that entails attracting new Product Development A marketing strategy that entails the creation of new Diversification Is a strategy of increasing sales by introducing new products Portfolio Matrix A tool for allocating resources among products or strategic business unites on the basis of relative market share and market growth rate Star In the portfolio matrix a business unit that is fast growing market leader Cash Cow In the portfolio matrix a business unit that generates more cash than it needs to maintain its market share Problem Child Question Mark In the portfolio matrix a business unit that shows rapid growth but poor profit margins Dog In the portfolio matrix a business unit that low potential growth and a small market share Marketing Strategy The activities of selecting and describing one or more target markets and developing and maintaining a marketing mix that will produce mutually satisfying exchanges with target markets Market Opportunity Analysis The description and estimation of the size and sales potential of market segments that are of interest to the firm and the assessment of key competitors in these market segments Marketing Mix A unique blend of product place distribution promotion and pricing strategies designed to produce mutually satisfying exchanges with a target market The Four P s Product Place Promotion and Price Chapter 3 Ethics and Social Responsibility Ethics The moral principles or values
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