Marketing The process of creating promoting distributing and pricing goods services and ideas to facilitate satisfying exchange Makes advertising and selling unnecessary The process by which companies determine what products or services may be of interest to consumers and the strategies to use in sales communications and business development Product development is a core marketing function firms need good products to sell in order to meet unmet consumer needs Marketers identify unmet consumer needs and then develop products that fill those needs How marketing is related to advertising and selling 1 They let consumers know that they need a product 2 Makes that need specific to their product Recapture market share from companies that have stolen our ideas Marketing power example Stock prices of Apple vs Dell Core strategies Creating value and relationships Segmenting markets Ex Different diet cokes marketed at specific genders based on color and appearance of product Identifying opportunities Pure short term marketing the business function that develops the products that people want to buy because they know they need them and because they can afford them and because they can find them Pure marketing employs the four P s in ways that benefit the consumer The foundation of every business If firms perform pure marketing correctly they don t need to advertise much Impure long term marketing refers to the competition created when someone develops a new product If firms fail to objectively distinguish their products from competitors then impure marketing becomes very important Example of this is Old Milwaukee Light The quality is better than Bud Light but Bid Light advertises more OML is good at pure marketing product development but bad at impure marketing convincing consumers of the quality of their product cid 224 Competition necessitates marketing Consumer reports rate generic brands as being just as good as marketed brands as in Publix cola vs CocaCola The History of Marketing I Simple trade era pre 1860s a Products were made by hand grown or traded in small quantities Most people lived on farms so they traded what they had b People were not picky about what they got II Production era pre 1920s a Made things in factories outsourcing Why individually produce everything in small areas and quanitites Go to big city hubs and manufacturing was born b Getting as much product out the door as possible as quickly as possible As long as it s black Why butcher my own chicken when I can buy yours i ii Technical development Inward focus III Sales era 1920s Great Depression a No one was buying anything because everyone was broke after the Depression Many people went out of business Factories were suffering need to hire a sales force to convince people to buy what they had and make people think they needed something b Budgeting what they had Risk averse because they weren t sure about tomorrow IV Marketing era 1940s 1990s a People regained consumer confidence b Focus on what we can sell to consumers that they don t really want to buy not on what they can make Make what we can sell not sell what we can make c Make what they can sell not just what they have Focused on consumer needs and what they wanted Customer is key focused on their satisfaction Introduces market research the process of going out and figuring out what people want e Market orientation d i Competitor orientation Must focus on what your competition is doing and how it is affecting customer perception of your product ii Inter functional orientation How well is an organization set up to produce the outcomes that consumers want iii Customer orientation What does the customer want Stakeholder Constituents that have a stake or claim in some aspect of a company s products operations markets industry and outcomes Not just focused on customers Ex BP s customers are people who buy their product and also who live on the coast and are impacted by their actions Customer centric marketing Developing collaborative relationships with customers based on focusing on their individual needs and concerns Relationship marketing Establishing long term mutually satisfying buyer seller relationships Customer relationship management Using information about customers to develop and sustain desirable customer relationships Green marketing Creating meaningful long term relationships with customers while maintaining supporting and enhancing the natural environment V Relationship marketing era 1990s 2010 Focus on long term relationships and customer retention a A 5 increase in customer retention yields up to a 95 improvement in NVP delivers by customers Repeat customer generate over twice as much revenue as new customers Engaged customers generate 1 7 times more revenue than normal customers b Due to these statistics firms focus on customer satisfaction and involvement Keeping your customers will make you more money c Some strategies used are things like reward cards Ex Skymiles VI Societal marketing era 1960s present green marketing a Focuses on society s best interest and corporate social responsibility Ex Ban on large sodas in New York because soda makes people fat b Firm now serves three entities the customer stockholder and society The eras are getting very short as the years go on The Four P s Marketing Mix 1 Product Goods services and ideas Identify unmet consumer needs and develop a product to fit those needs Most jobs include services not much of actual manufacturing 90 of Florida goods are outsourced 2 Place Distribution Making the product readily available to the consumer Ex Walmart dominates distribution channel therefore they can charge low prices because firms don t want to lose their business Minimize costs managing inventory finding out best ways of transportation and storage 3 Price policies Determining product prices and the value of the exchange Decisions and actions associated with establishing pricing objectives and Biggest impact on sales Most immediate indicator of quality cheaper price is correlated to cheaper quality Price creates value and relationships Informs individuals or groups about the organization and its 4 Promotion products services a Doesn t just include advertising also PR personal selling promotions street teams guerilla marketing viral marketing Guerilla marketing Hidden people that use product in public places to Ex Starbucks secret shoppers sit in public and enjoy drink promote a particular product Take a picture of me
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