BUSI 406: Principles of Marketing Lecture 3 Outline of Last Lecture I. What is Marketing & why it is importantII. Micro-marketing vs. macro-marketingIII. Marketing and economic developmentIV. Marketing concept – Customer value & satisfactionOutline of Current Lecture I. Marketing strategy planninga. 3C’sb. SWOTc. Target marketingd. 4 P’s/marketing mixII. Attractive OpportunitiesCurrent LectureThe Management Job of MarketingThe marketing management process - refers to the planning, implementation, and control of marketing activities. - activities are continuous, and decisions made in the past in one area can have implications on the other areas as well. Planning• required because marketing managers must seek new opportunities.  Implementation• the process of putting marketing plans into action. Control• assessing and evaluating marketing performance. o When performance falls short of expectations, the marketing manager must take corrective action. Strategic (management) planning• developing and maintaining a match between an organization’s resources and its market opportunities.o Marketing planning is part of the strategic management planning for the entire company.o The more marketing-oriented a firm is, the larger a role marketing planning will play in strategic planning. These notes represent a detailed interpretation of the professor’s lecture. GradeBuddy is best used as a supplement to your own notes, not as a substitute.What is Marketing Strategy PlanningMarketing strategy planning - means finding opportunities and developing profitable marketing strategies that the company can use to capitalize on them.Marketing strategy--specifies a target market and a related marketing mix; provides “big picture” of what the firm will do. • Target market --a fairly homogeneous (similar) group of customers to whom a company wishes to appeal.• Marketing mix--the controllable variables (ie the 4P’s) the company puts together to satisfy the target market.Pro forma budget or income statementSelecting a Market-Oriented Strategy is Target Marketingdifference between target marketing and mass marketing is - directly linked to the concept of a marketing strategy, because a marketing strategy specifies some particular target customers.  Target marketingo tailoring the marketing mix to meet the needs of a specific group of target customers.  Mass marketingo offering a single marketing mix combination to everyone.• Mass marketers may still do target marketing. • EX. Wal-Mart is a mass marketer, serving a large well-defined target market.• Mass marketing attempts to serve all consumers in the same way.  Target marketing is definitely not mass marketing. • Target marketing is not limited to small market segments.• A market segment can be fairly homogeneous, big, and profitable. • Small market segments can also be profitable.An Application of Target MarketingThis ad for BWI airport is an example of target marketing, because BWI is promoting “application-specific” distribution facilities.• BWI can meet all storage/distribution needs. • BWI saves time with its efficient distribution centers. • The ad copy states that BWI can handle air, port, and rail connections. • BWI serves the shipper, no matter what their needs. • Product considerations include: o physical characteristics, o branding, packaging, warranties; o after-sale service;o managing the product assortment;o new product development;o management of the product throughout its life cycle. Developing Marketing Mixes for Target MarketsSurrounding the target market with the 4P’s so to speakProduct Elements• Product considerations include: o physical characteristics, o branding, packaging, warranties; o after-sale service; o managing the product assortment;o new product development;o management of the product throughout its life cycle. Place Elementsthis element of the marketing mix is to get the right product, to the right consumer, in the right place, at the right time, in the right quantity, and in the right condition, hopefully all at a reasonable cost. • Channel of distribution: any series of firms or persons used to move goods from producers to final users. Channels can be:o very long or very short;o simple or complex. • Marketers must: o find the best kinds and types of channels for the product;o effectively manage the channel.• Other aspects of place:o logistics or physical distribution; o roles of middlemen, such as wholesalers and retailers.Promotion Elementsinvolves telling the target market about the product and selling the product to the target customer. There are four main types of promotion.• Personal selling: direct communication between sellers and potential customers.• Mass selling: communicates with large numbers of customers at the same time. o Advertising- any paid form of nonpersonal presentation of ideas, goods, and services by an identifying sponsor.o Publicity- unpaid, nonpersonal presentation of ideas.• Sales promotion: promotion activities, other than advertising, publicity, and personal selling, that stimulate interest, trial, or purchase. Price Elementsthe revenue-generating function of the marketing mix. In setting the “right” price, marketing managers must consider many factors, all of which combine to make pricing a combination of science and art.Can choose from several different pricing objectives and policies. Among the policies are:• price flexibility;• how price changes over the product life cycle;• various allowances, discounts, and geographic terms that affect the final price. Legal environment considering in pricing strategyOther aspects of price include:• cost structure and the demand; • price sensitivity; competition, available substitutes;• impact of the price of one product on any other products offered by the organization.All 4 P’sAll of the four Ps--product, place, promotion and price--have an impact on satisfying the needs of consumers in the target market. No single area is more important than the others--they are all interconnected.In developing a marketing strategy, the jobs of selecting a target market and developing the marketing mix are interrelated. The outcome of the strategy is evaluated against the objectives of the marketer. Keeping in mind the marketing concept, the needs of the target market determine the nature ofthe marketing mix, so developing a thorough understanding of the