Marketing January 10 2013 CHAPTER 1 Why should I care Chipotle Example Food with Integrity o Aiming Mexican food to a different market healthy clean and different o No coupons or special deals word of mouth o Aggressive about having people move up in the company different philosophy than other fast food jobs o Advertisements billboards You can t talk about marketing without talking about product and service Everything you do is all part of the message you send to your customers and vice versa about who you are Marketing is the identification of what your customer wants and needs and how to supply that to them Examples o Vera Bradley Marketing Mix the marketing mix o The 4 P Framework o Advertising and sales are components of the promotional element of Product the products and its characteristics Price set the price Place decide how to distribute the product Promotion how are you going to get them to know about it o Some critics feel the 4 P s underemphasize or omit certain important activities o The marketing mix must be just that a mix of ingredients to create an effective product service package for the target market o This does not mean that selling and promotion are unimportant They are part of a larger marketing mix a set of marketing tools that work together to produce satisfied customers o The only way selling and promoting will be effective is if we first define customer targets and needs and then prepare an easily accessible and available value package Marketing is the art and science of finding retaining and growing profitable customers The Marketing Process process Here are steps one through four of a simple five step model of the marketing o Companies working to understand consumers create customer value build strong customer relationships The Marketplace and Customer Needs Customer Needs Wants and Demands o The most basic concept underlying marketing is that of human needs A human need is a state of felt deprivation These needs were not invented by marketers but are part of the human makeup o The second basic concept to marketing is that of human wants the form human needs take as they are shaped by culture and individual personality Wants are how people communicate their needs Wants are described in terms of objectives that will satisfy needs What are some of your wants and needs in the market o Pizza example you don t need pizza you want it you need food o People have almost unlimited wants but limited resources and so choose products that produce the most satisfaction for their money When backed by buying power wants become demands Example Lamborghini cars there is a want for them but no demand b c people don t have the money to actually get one o Outstanding marketing organizations go to great lengths to learn about understand their customer s needs wants and demands They conduct customer research Facebook surveys track new Disney bracelet Smart companies also have employees at all levels including top management stay close to customers Products Services and Experiences o Consumer needs and wants are fulfilled through a market offering a product that is some combination of tangible services information or experiential product components o In the hospitality industry the intangible product including customer service and experiences are more important than the tangible products a market offering includes much more than physical goods or services Customer Value and Satisfaction o Customer value is the difference between benefits the customer gains from owning and or using a product and the costs of obtaining the product o Costs can be monetary or nonmonetary a very big nonmonetary cost for hospitality customers is time Example of non monetary cost time service headache stress wedding planners too much work Choosing a Value Proposition o A company s value proposition is the set of benefits or values it promises to deliver to consumers to satisfy their needs Such propositions differentiate one brand from another o Who are we and what do we do o There s always a set of benefits for each company Markets o A market is a set of actual and potential buyers of a product o These buyers share a particular need or want that can be satisfied through exchange relationships o Who is our customer and what do they want Book Notes Customer Orientation o Marketing more than any other business function deals with o Purpose of a business is to create and maintain satisfied profitable o The attitude of profit first then customer service will eventually sink a o Customer satisfaction leading to profit is the central goal of hospitality customers customers firm marketing What is Hospitality Marketing o Marketing is a social and managerial process by which individuals and groups obtain what they need and want through creating and exchanging products and value with others Importance of Marketing o The entrance of corporate giants into the hospitality market and the marketing skills these companies have brought to the industry have increase the importance of marketing within the industry o Analysts predict that the hotel industry will consolidate in much the same way as the airline industry has with 5 or 6 major chains dominating the market Such consolidation will create a market that is highly competitive The firms that survive this consolidation will be the ones that understand their customers o In response to growing competitive pressures hotel chains are relying on the expertise of the marketing director Travel Industry Marketing travel industry o Successful hospitality marketing is highly dependent on the entire o Government or quasi government agencies play an important role in travel industry marketing through legislation aimed at enhancing the industry and through promotion of regions states and nations o Few industries are as interdependent as the travel and hospitality industries Understanding Marketing o Marketing is a social and managerial process by which individuals and groups obtain what they need and want through creating and exchanging products and cause with others o Need to understand the following Needs wants and demands Needs human beings have many complex needs These include needs for food clothing warmth and safety Social needs for belonging affection fun and relaxation Esteem needs for prestige recognition and fame and Individual needs for knowledge and self expression Wants wants are how people communicate their needs Demands people have unlimited wants but limited