Current Marketing Fundamentals Course Web Site
What is marketing? Almost every marketing textbook has a different definition of the term "marketing." The American Marketing Association (AMA) uses the following: "The process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods, and services to create exchanges that satisfy individual and organizational objectives." From this definition, we see that:
Marketing involves an ongoing process. The environment is "dynamic." This means that the market tends to changewhat customers want today is not necessarily what they want tomorrow. For example, sales of beef are declining in the United States because consumers have become health oriented. Similarly, Tupperware parties are less popular today than they once were because there are fewer housewives who do not work outside the home. This process involves both planning and implementing (executing) the plan. Some of the main issues involved include:
Marketers help design products, finding out what customers want and what can practically be made available given technology and price constraints. Marketers distribute productsthere must be some efficient way to get the products from the factory to the end-consumer. Marketers also promote products, and this is perhaps what we tend to think of first when we think of marketing. Promotion involves advertisingand much more. Other tools to promote products include trade promotion (store sales, coupons, and rebates), obtaining favorable and visible shelf-space, and obtaining favorable press coverage. Marketers also price products to "move" them. We know from economics that, in most cases, sales correlate negatively with pricethe higher the price, the lower the quantity demanded. In some cases, however, price may provide the customer with a "signal" of quality. Thus, the marketer needs to price the product to (1) maximize profit and (2) communicate a desired image of the product. Marketing is applicable to services and ideas as well as to tangible products. For example, accountants may need to market their tax preparation services to consumers. Reasons for studying marketing. There are several good reasons for studying marketing. First of all, marketing issues are important in all areas of the organizationcustomers are the reasons why businesses exist! In fact, marketing efforts (including such services as promotion and distribution) often account for more than half of the price of a product. As an added benefit, studying marketing often helps us become more savvy consumers. We will learn, for instance, that the per unit price of a bigger package is frequently higher than that of a smaller one, and that more expensive products are frequently not better in quality.
Criteria that must be met for marketing to occur. Several criteria must be met for marketing to occur:
There must be two parties, each with unsatisfied needs or wants. This want, of course, could be money for the seller. Each must have something to offer. Marketing involves voluntary "exchange" relationships where both sides must be willing parties. Thus, a consumer who buys a soft drink in a vending machine for 60¢ must value the soft drink, available at that time and place, more than the money. Conversely, the vendor must value the money more. (It is interesting to note that money is, strictly speaking, not necessary for this exchange to take place. It is possible, albeit a bit cumbersome, to exchange two ducks for a pair of shoes.) The parties must be able to communicate. This could be through a display in a store, an infomercial, or a posting on eBay. The marketing vs. the selling concept. Two approaches to marketing exist. The traditional selling concept emphasizes selling existing products. The philosophy here is that if a product is not selling, more aggressive measures must be taken to sell ite.g., cutting price,...