MAR3023 Exam 1 Review What Marketing is and what it isn t o Marketing is the foundation of every business It is the business function that develops the products people want to buy and they know they need them and because they know they can afford them and because they can find them the products must also be appropriately delivered to where customers are If firms perform pure marketing correctly they don t need to advertise much or hire a huge sales team to push their products Marketing s core strategies o Segmenting Markets o Creating value and relationships ex banks that offer coffee hotel with 24 hour check in offering free babysitting at places etc when a company has many brands or products ex diet coke coke with vitamins coke lime coke with Splenda or how Marriot hotels have different hotel brands to satisfy different customers needs upscale value extended stay suites timing meet to create strategic windows market opportunity is where circumstances and o Identifying opportunities Core competencies Competitive advantage Opportunity Competency things a firm does well o Sales Era firms produced what they could make inward focus and firms pushed products using aggressive sales tactics focus on technical development sellers market where demand supply selling what we make aggressive promotion and short term profit maximization focus on customer orientation the great awakening where o Marketing Era customers became the central focus of the organization focus on customer is key and we make what we sell interest to the mix green marketing firms now serve three entities present adds societies best o Societal Era Know the history of Marketing o Production Era 4 P s o Product Goods services ideas o Place Distribution Available in quantities desired Minimizing costs inventory transportation and storage o Promotion Inform consumers about the firm and its product advertising PR personal selling promotions street teams guerilla marketing viral marketing o Price Determining product prices and the value of exchange SWOT analysis Strengths weaknesses opportunities threats o Matching strengths to opportunities o Converting weaknesses to strengths o Converting threats to opportunities Strategic Business Unit division of a parent company 1 o Internal Marketing o External Marketing Company employee empowerment is key Company customer BCG s matrix Star Cash cows Question marks Dogs Environmental Forces o Cash cow dominant share of a market but low prospect for growth ex products with a dominant share of the market and good prospects for o Star growth however they tend to use more cash than they generate high product market growth high relative market share Bounty paper towels the best selling paper towels that represent cash cow for Proctor and Gamble another example is soda market low product market growth high relative market share requires lots of cash ex Mercedes carbon racing bikes high product market growth low relative market share o Dogs growth low relative market share in established markets phased out products low product market product children small share of a growing market that o Question marks Brand Competitors Brand name v generic different brand in same market ex Coke v competitors in slightly different market ex Generic Competitors Total Budget Competitors o Competitive forces Pepsi Product Competitors tea v soda ex chips v soda for the same price entry barriers ex airlines operating systems differentiate a product normal market Pure Competition and low barriers to entry sellers wouldn t be able to influence price or supply doesn t really exist best example would be farmers market where local growers gather to sell produce when a few competitors control supply usually due to when firms in competitive industries attempt to large number of sellers with similar products making a tradeoff between markets Monopolistic Oligopoly o Sociocultural demographic diversity cultural values consumerism affects how people live and helps determine where how and when people buy products Demographics diversity people increases demand for health care dating sites geared towards older people baby boomers etc affects the market place ex more older Increasing multicultural nature of the U S society advertising in different languages lots of younger immigrants that are having more kids new target market Problems and opportunities more diverse population means more diverse consumer base and marketing practices must be modified and diversified to meet changing needs Cultural values cultural values don t change over night but do change at varying speeds ex people are now more into eating healthier foods less smoking and drinking exercising protection with sexual behavior organic foods etc 2 Consumerism organizations to protect consumer rights organized efforts by individuals groups and Major forces individual consumer advocates consumer organizations and other interest groups consumer education consumer laws o Technological technological advances o Economic Helps markets stay in touch with clients make appointments and handle last minute orders or cancelations The dynamics of technology involve the constant change that often challenges the structures of social institutions including relationships the legal system religion education business and leisure Acts as a catalyst to spur even faster development as new innovations are introduced they stimulate need for advancement to facilitate further development To remain competitive companies must keep up with and adapt to Business cycle Prosperity Recession Depression Recovery In prosperity consumers are generally willing to buy and marketers often expand their product offerings to take advantage of increased buying power they can sometimes capture a larger market share by intensifying distribution and promotion efforts In a recession customers become more price and value conscious and look for basic and functional products marketers should focus on determining precisely what functions buyers want promotional efforts should emphasize value Marketers face problems in recovery it is difficult to ascertain how quickly and to what level prosperity will return marketers should maintain as much flexibility as possible to make adjustments Federal Trade Commission FTC agency that regulates a variety of business practices and curbs false advertising misleading pricing and deceptive packaging and labeling Assists businesses in complying with laws and evaluates new
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