Chapter 1 Marketing the process of creating distributing promoting and pricing goods services and idea to facilitate satisfying exchange relationships with customers and develop and maintain favorable relationships with stakeholders in a dynamic environment Customers the purchasers of organizations products the focal point of all marketing elements Target Market the group of customers on which marketing efforts are focused Marketing Mix four marketing elements product distribution promotion and pricing that a firm can control to meet the needs of customers within its target market Product a good service or idea Product Variable Researching customer s needs and wants and designing a product that satisfies them Good physical thing you can touch o Car iPod battery Service an application of human and mechanical efforts of people or objects to provide intangible benefits to customers o Air travel dry cleaning hair cutting Ideas concepts philosophies images and issues o Marriage counseling political party school that no longer satisfy enough buyers Distribution Variable Marketers must always develop new products modify existing ones and eliminate those Products must be available at the right time and through convenient distribution methods Marketing managers make products available in quantities desired to as many target market customers as possible Companies can now make products available throughout the world thanks to the internet Activities used to inform individuals or groups through increased public awareness about the organization and its products Educates about product features or urge people to take a particular stance on a political or Sustain interest in established products that have been available Promotion Variable social issue Price Variable Decisions and actions associated with establishing pricing objectives and policies and determining product prices Often used as a competitive tool and can lead to price wars High prices can establish a product with an image of high quality and significant status There are limits as to how much managers can alter these marketing mix variables due to Economic conditions competitive structure or government regulations Making changes in tangible goods is expensive Promotional campaigns and methods used cannot be rewritten or changed overnight Exchanges the provision or transfer of goods services or ideas in return for something of value For an exchange to occur four conditions must exist Two or more individuals or groups must participate and each possess something of value that the other party desires The exchange should provide a benefit or satisfaction to both parties in the transaction Each party must have confidence in the promise of the something of value held by the other The parties to the exchange must meet expectations to build trust Marketing activities can occur without an exchange taking place such as an ad on TV Should attempt to create and maintain a satisfying exchange to keep customers coming back Stakeholders include those constituents who have a stake or claim in some aspect of a company s products operations markets industry and outcomes Include employees customers investors and shareholders etc Marketing Environment includes competitive economic political legal and regulatory technological and sociocultural forces that surrounds the customer and affect the marketing mix Affect a marketer s ability to facilitate exchanges by Influence customers by affecting their lifestyles standards of living and preferences and needs for products Marketing environment forces help determine whether and how a marketing manager can perform certain marketing activities Environmental forces may affect a marketing manager s decisions and actions by influencing buyers reactions to the firm s marketing mix Forces are closely interrelated and change quickly and dramatically Marketing Concept am organization should try to provide products that satisfy customers needs through coordinated set of activities that also allows the organization to achieve its goals Determine what customers want and develop satisfying products at profit High levels of customer satisfaction lead to higher shareholder value and better Management philosophy that guides organization s overall activities and affects all employees and managers organizational activities Production Orientation Second half of 19th Century advances in mass production technology transportation and new ways to use labor allowed for a high amount of products to enter the market Sales Orientation mid 1920s early 1950s businesses started to sell products since strong demand subsided giving marketing a false name Market Orientation early 1950s Present first determined what customers wanted and then produced the products customers desired Requires intelligent decisions based on present and future customer needs Implementing the Marketing Concept Establish an information system to discover customer s real needs and then use the information to create satisfying products Coordinate all its activities even in other departments Fundamental goal of every marketing strategy the full profit potential of each customer relationship attained by Acquiring new customers Enhancing the profitability of existing customers Extending the duration of customer relationships Relationship marketing establishing long term mutually satisfying buyer seller relationships Customer builds trust in company creating dependency Customer centric marketing developing collaborative relationships with customers based on an individual s needs and concerns more personable customer experience Customer Relationship Management CRM uses information about customers to crate marketing strategies that develop and sustain desirable customer relationships Build customer loyalty which increases customer value Rewards programs and incentives coupons for loyal customers Value a customer s subjective assessment of benefits relative to costs in determining the worth of a product important element in customer relationships and applying marketing concept Customer value customer benefits customer costs Develop a concept of value through their perception of product quality and financial sacrifice Customer benefits anything the customer receives from an exchange Customer costs anything the customer gives up to obtain benefits of the product Value can be perceived in many ways from the lowest price to the fastest preparation time Marketing Management the
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