MARKETING 301 EXAM 1 STUDY TOPICS INTRO WHAT IS MARKETING What is marketing The process by which companies create value for customers and The marketing concept build strong customer relationships in order to capture value from customer relationships in return o Types of products Marketers create value through products physical objects o Types of customers people organizations places information and ideas Sales concept production concept product concept Marketing myopia You become too narrow in focus in marketing picking what you think is a good idea or convenient rather than what the customer wants Example BiC creating undesirable but convenient Paris in Your Pocket perfume Societal marketing concept Example 1 Starbucks is now more community oriented and portrays itself as a local coffee shop because of criticism that it was too big business Example 2 McDonalds is now offering healthy and higher end options salads caf after criticism of movies like Supersize Me and blame for obesity The marketing mix implement How marketers marketing strategies Marketing process model o Steps in the process o Consumer touch points Building and capturing customer value o Customer loyalty and retention o Customer referrals o Customer equity Customer lifetime value example Penn Stater loyalty over a lifetime o Consumer generated marketing and contributions to the University o Customer relationship groups All lead to Higher Profits MARKETING ENVIRONMENT What is the marketing environment why is it important The actors and forces outside marketing that affect marketing management s ability to build and maintain successful relationships with target customers Studying the environment allows marketers to Understand the constraints they operate under Learn the opportunities Reveal threats to avoid or combat Actors in the microenvironment 1 The company All departments must MUST think customer Cooperate inter functionally to provide superior customer value and satisfaction this includes cooperation between finance accounting management operations purchasing and Research Development 2 Suppliers provide resources needed for production and innovation 3 Marketing Intermediaries help the company promote sell and distribute the product to end users Beneficial to partner with intermediaries Resellers Coke partners with Wendy s to get additional sale in return for valuable consumer information to Wendy s and improve credibility and profitability for both partners 4 Customers types of customers Who buys our product There are 5 basic Physical distribution firms Marketing service agencies Financial intermediaries types of buyers 1 Consumer 2 Business 3 Reseller 4 Government and non profit 5 International markets 5 Competitors competitive advantage law of color Who might the consumers choose instead Typically provide reasonable substitutes to customers with competitive advantage or point of difference Law of Color brand should use a color that is the opposite of leading competitors Not followed by everyone banks and more seriously businesses are more toned down but typically used by brands for color association and in order to stand out among those that pass by 6 Publics e g financial media Publics any group that has an interest in or impact on an organization s ability to achieve its objectives Types Financial Media Government Citizen action Local General Internal Example Tide Loads of Hope for natural disaster that promotes sales but proves global action taking company Forces in the macroenvironment 1 Demographic forces e g household structure population diversity age structure Marketers track measurable census type data on consumers such as Household structures why we have so many family restaurants with 4 seats whereas China would have 6 to 8 for extended family Age Structures s Born 1946 r e m o o B y b a B 1964 Most affluent group Lifely to postpone retirement and stay active X Born 1965 n o i t a r e n e G 1976 Less materialistic Spend time cutting and pasting lives Care about the environment Y Born 1977 n e G s l a i n e l l i 2000 Echo Boom Large disposable income Comfortable with technology Now Oriented M Geographic population shifts Educational characteristics Population diversity Occupations FedEx recognized shift to home workers and began to make company a more local personal experience when you would come into stores Example of implementation Campbells recognizes more single people and single parent homes thus a greater need for single serving products They develop Soup at Hand and market it to anyone who lives a busy lifestyle 2 Economic forces e g value marketing Engel s law treasure hunter We now face a change in buyer behavior Change in Income distribution Overconsumption Value marketing Vera Wang for Kohls Treasure Hunter Tradeoffs making tradeoffs so that we can buy the expensive treasures we really want ie spending less on groceries and saving up for an iphone Upper Class growing richer Middle Class Working Class growing larger Underclass Born 1946 1964Most affluent groupLifely to postpone retirement and stay activeBorn 1965 1976Less materialisticSpend time cutting and pasting livesCare about the environmentBorn 1977 2000 Echo Boom Large disposable incomeComfortable with technology Now Oriented 3 Natural forces that are needed as inputs by marketers or that are affected by marketing activities Factors include Shortages of raw materials Increased pollution Increased government intervention Environmentally sustainable strategies 4 Technological forces e g augmented reality Factors that create new technologies creating new product and market opportunities while making other products obsolete 5 Political forces and marketing laws e g price discrimination Laws regulations and pressure groups that influence and limit various organizations and individuals in a given society Most laws the affect marketing have been passed in order to protect the consumer Fair Packaging and Labeling Act Must be truthful in what who and how much is in your package the package Federal Food and Drug Act Info placed regarding how much what and who is in Truth in Advertising Must tell truth but exaggeration and parodies are allowed Sherman Antitrust Act Companies cannot engage in agreeing on price with competition or predatory pricing in which you lower prices so much in order to put the Robinson Patman Act Price discrimination is not legal 6 Cultural forces Trends The forces that affect a society s basic values perceptions