Lecture 1 Marketing process of creating distributing promoting and pricing goods services and ideas to facilitate satisfying exchange relationships with customers and to develop and maintain favorable relationships with stake holders in a dynamic environment o Why do people buy coke Tastes good Caffeine It s a great product marketing o Marketing development of a great product Product development is a core marketing function o There would be no firms or products without marketing o 4 P s of marketing Product The first goal of marketing is to identify unmet consumer needs and then develop products that fill those needs Ex Henry Ford offered car only in black because he could it was a great product Price Place Have to make it the right price that maximizes revenue Explains how marketing economics and finance are related Getting coke to where you can buy it is also part of marketing You can get a coke anywhere o Channels distribution logistics Promotion Great marketers o 1 Develop products that people want or need o 2 Price them at a level that maximizes profits o 3 Distributes them to where consumers are Game Changer Products o Ex Iphone Kindle Ipad Don t have to advertise a lot for them Marketing did a good job the product sells itself o Ex Spandex If you do marketing function right you do not really need to advertise o If marketers hit their mark with the product price and distribution there is little need to advertise o Saves a lot of money Ex Costco Rolls Royce 4 Rivers BBQ Marketing Results o Apple stock keeps on rising over the past 10 years o On the other hand dell stock has gone down The quality of the product died down Marketing is not advertising or promotion o It is complex strategic quantitative multifaceted etc o Problem caused from markets who are hawking and lying about the product People who make bad products look good The other side of marketing o Time reality business Ex Google making a similar iPad superior o Its powerful People make similar products competition that work the same as the original and take After the competition is created the dominant firm has to convince customers its product is Advertising and branding are powerful when it comes to marketing products for products that are not objectively distinguishable Why promotion works so well Ex Old Milwakee Light is the best light beer more awards that any other been in the light beer category o Bud Light has never won an award but the sell the most Consumers do not buy unfamiliar products o Even if the unfamiliar is objectively better o It works really well Lecture 2 Ratings o Consumer reports rates all of the products you saw as objectively the same or better than the branded products Ex Frosted Flakes v Store Brand Brands and marketing are powerful o Get you to believe the brand is better o Only used when there are a lot of competitors with similar products History of Marketing o Simple Trade Era Pre 1860s Products were made by hand grown or traded in small quantities Lasted up until the industrial revolution Realized they could make same products in a big amount cheaper and distribute o Production Era Pre 1920s As long as its black inward focus o company focused on what they could create not what customers wanted technical development emphasis on production Condition Sellers Marker Demand exceeded supply Lots of buyers few sellers sellers market o Sales Era 1920s Changing their minds great depression happened people became conservative buyers Focus on Selling what we make Aggressive promotion vacuum cleaners Short term profit maximization o The Marketing Era 1940s 1990s Customer focused Focus on Customer is the key delight Make what we sell Marketing orientation Competitor orientation Customer orientation Inter functional orientation The great awakening where customers became the central focus of the organization Began with the development of marketing departments 1940 1960 and then transferred to the rest of the firm 1960 1990 Companys started to think of what the customer wanted Stakeholders constituents who have a stake or claim in some aspect of a company s products operations markets industry and outcomes Ex When the Oil Spill happened BP stakeholders had to deal with the problems Clues to a Market Orientation Customer centric marketing developing collaborative relationships with customers based on focusing on their individual needs and concerns Relationships marketing establishing long term mutually satisfying buyer seller relationship o Develop long term relationships and make you keep buying Customer relationships management using info 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 o Relationship Marketing Era 1990s 2010 The focus is on long term relationships and customer retention Yielded great results Ex The 5 increase in customer retention yields up to 95 improvement in NPV delivered by customers o NPV net present value Repeat customers generate over twice as much revenue as new customers Engaged customers generate 1 7 times more revenue than normal customers Point is to get customers and keep customers by developing mutually beneficial relationships Relationship marketing today Ex if you are earning delta sky miles you are not going to switch airlines because you want the miles o Societal Marketing Era 1960s present green marketing focus on adds society s best interest to the mix corporate social responsibility firm now serves three entities the 4 p s marketing mix drive products and company o products goods services ideas best products o distribution place make products available in quantities desired minimize costs inventory transportation storage Ex Coca Cola get the product everywhere o Promotion ex ford s my key parents can control the car for their children i e max speed gas etc Inform individual or groups about the organization and its products services Advertising Public relations Personal selling Promotions Street teams guerilla marketing Viral marketing o In social media world o Pricing Decisions and actions associated with establishing pricing objectives and policies Determining product prices Determine the value of the exchange Point where maximized profit is made Popular Macro Marketing Strategies o Creating Value Came on scene in the 90s with value menus Ex Taco Bell first person to do this Creating value o
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