Chapter One An Overview of Strategic Marketing Defining Marketing Marketing is the process of creating distributing promoting and pricing goods services and ideas to facilitate satisfying exchange relationships with customers and develop and maintain favorable relationships with stakeholders in a dynamic environment o The foundation of every business Customers are the purchasers of organizations products the focal point of all marketing elements o Organizations must define their products not according to what they produce but according to how they satisfy the customers o Customer satisfaction and enjoyment can come from anything experienced when buying and using a product o Customers and marketers both expect benefits or rewards for each transaction Target market is the group of customers on which marketing efforts are focused Marketing mix is the four elements product distribution promotion and pricing that a firm can control to meet the needs of customers within its target markets o A primary goal of a marketing manager is to create and maintain the right mix of these elements to satisfy the customers needs for a general product type o Marketing managers must collect in depth information about customers needs before they can develop a marketing mix A product is a good service or idea o A good is something you can touch o A service is the application of human and mechanical efforts o Ideas include concepts philosophies images and issues The distribution variable includes satisfying the customer by its products being available at the right time and through convenient distribution methods The promotional variable relates to activities used to inform individuals or groups about the organization and its product The price variable relates to decisions and actions associated with establishing pricing objectives and policies and determining product prices o Price is often a competitive tool o They are controllable because they can be modified Exchanges are the provision or transfer of goods services or ideas in return for something of value You must have o Two or more groups must participate o Benefit or satisfaction for both parties o Confidence in the promise of something of value o Build trust Stakeholders include those constituents who have a stake or claim in some aspect of a company s products operations markets industry and outcomes o Ex customers employees investors suppliers governments communities etc The marketing environment which includes competitive economic political legal and regulatory technological and sociocultural forces surrounds the customer and affects the marketing mix o The forces of marketing environment affects a marketer s ability to facilitate exchanges in THREE ways They influence customers by affecting their lifestyles standards of living and preferences and needs for products Help determine whether and how a marketing manager can perform certain marketing activities May affect a marketing manager s decisions and actions by influencing buyers reactions to the firm s marketing mix History of Marketing Sales Era firms pushed products using aggressive sales tactics Marketing Era focus on customer orientation Societal Era firms now serve three entities Four P s Product Placement Promotion Price Understanding the Marketing Concept Marketing concept is a philosophy that an organization should try to provide products that satisfy customers needs through a coordinated set of activities that also allows the organization to achieve its goals o Emphasizes that marketing begins and ends with the customers A marketing orientation is an organization wide commitment to researching and responding to customer needs Managing Customer Relationships Profits can be obtained by o Acquiring new customers o Enhancing the profitability of existing customers o Extending the duration of customer relationships Relationship marketing establishes long term mutually satisfying buyer seller relationships Customer centric marketing involves developing collaborative relationships with customers based on focusing on their individual needs and concerns Customer relationship management focuses on using information about customers to create marketing strategies that develop and sustain desirable relationships o Provides a strategic link between information technology and marketing efforts to foster relationships with customers Value Driven Market Value is a customer s subjective assessment of benefits relative to costs in determining the worth of a product o Customer Value Customer Benefits Customer Cost Customers receive benefits based on their experiences The marketing mix can be used to enhance perceptions of value Marketing Management Marketing management is the process of planning organizing implementing and controlling marketing activities to facilitate exchanges effectively and efficiently o Effectiveness is the degree to which an exchange helps achieve an organization s o Efficiency refers to minimizing the resources an organization must spend to achieve a specific level of desired exchanges The overall goal is to facilitate highly desirable exchanges and to minimize the cost of objectives doing so The Importance of Marketing in Our Global Economy Marketing costs consume a sizable portion of buyers dollars Marketing is used in nonprofit organizations Marketing is important to business and the economy Marketing fuels our global economy Marketing knowledge enhances consumer awareness Marketing connects people through technology Socially responsible marketing Promoting the welfare of customers and society o Green marketing is a strategic process involving stakeholder assessment to create meaningful long term relationships with customers while maintaining supporting and enhancing the natural environment Marketing offers many exciting career prospects Key Points Pure Marketing is about developing good PRODUCTS that people want and need o They also have to be promoted and priced appropriately and delivered to where consumers are If firms perform pure marketing correctly they don t need to advertise much or hire a huge sales team to push their products o So ironically if marketing is done correctly there is not as great a need for the two things that have come to define marketing If firms fail to objectively distinguish their products from competitors then impure marketing becomes very important Chapter Two Planning Implementing and Controlling Marketing Strategies Understanding the
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