Chapter One: An Overview of Strategic MarketingDefining 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 customerso Customer satisfaction and enjoyment can come from anything experienced when buying and using a producto 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 marketso 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 toucho A service is the application of human and mechanical effortso 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 priceso Price is often a competitive toolo 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 partieso 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 outcomeso 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 mixo 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 mixHistory of Marketing• Sales Era – firms pushed products using aggressive sales tactics• Marketing Era- focus on customer orientation• Societal Era – firms now serve three entitiesFour P’s• Product• Placement• Promotion• PriceUnderstanding 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 goalso Emphasizes that marketing begins and ends with the customers• A marketing orientation is an organization wide commitment to researching and responding to customer needsManaging Customer Relationships• Profits can be obtained by:o Acquiring new customerso Enhancing the profitability of existing customerso 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 relationshipso Provides a strategic link between information technology and marketing efforts to foster relationships with customersValue-Driven Market• Value is a customer’s subjective assessment of benefits relative to costs in determining the worth of a producto Customer Value = Customer Benefits – Customer Cost• Customers receive benefits based on their experiences• The marketing mix can be used to enhance perceptions of valueMarketing Management• Marketing management is the process of planning, organizing, implementing, and controlling marketing activities to facilitate exchanges effectively and efficientlyo Effectiveness is the degree to which an exchange helps achieve an organization’s objectiveso 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 doing soThe 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 societyo 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 prospectsKey Points• Pure Marketing is about developing good PRODUCTS that people want and needo 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”
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