Chapter One Notes: Overview of Marketing
Chapter 1 Objectives
• Define marketing and explain its core concepts
• Discuss how marketers create value for a product or service • Explain the four orientations of marketing
• Discuss the role of customer relationship management in creating value • Discuss the importance of marketing both within and outside the firm
What is Marketing?
• The marketing Umbrella:
o Target Market
• Definitions of Marketing:
o Marketing is the performance of business activities that direct the flow of goods and services from the producer to the consumer. o Marketing is getting the right goods and services to the right people at the right place with the right communication and promotion. o Marketing is a social and managerial process by which individuals/groups get what they need and want through creating and exchanging products and values with others. o Marketing is the process of buying and selling.
o Marketing is those activities performed by individuals or organizations that enable, facilitate and encourage exchange to the satisfaction of both parties. o A set of business practices designed to plan for and present an organization’s products or services in ways that build effective customer relationships • Marketing is not:
o Simply about buyers and sellers exchanging money for goods and services o Simply about making a profit
• Marketing IS:
o Marketing is an organizational function and a set of processes for creating, capturing, communicating, and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders • Marketing plan: a written document composed of an analysis of the current marketing situation, opportunities, and threats for the firm, marketing objectives and strategy specified in terms of the four Ps, action programs, and projected or pro forma income (and other financial) statements
Marketing is about satisfying customer needs and wants
• Need: a person feeling physiologically deprived of basic necessities, such as food, clothing, shelter, and safety • Want: the particular way in which a person chooses to satisfy a need, which is shaped by a person’s knowledge, culture, and personality • In order to understand customer needs and wants, the company must first identify the customers or market for its product or service • Market: refers to the groups of people to whom an organization is interested in marketing its products, services, or ideas • Target market: the customer segment or group to whom the firm is interested in selling its products and services; potential customers who have both an interest in the product or service and an ability to buy it • Goods: items that can be physically touched
• Services: intangible customer benefits that are produced by people or machines and cannot be separated from the producer • Ideas: include thoughts, opinions, philosophies, and intellectual concepts
Marketing Requires Product, Price, Place & Promotion Decisions (4Ps)
• Marketing mix (4Ps): product, price, place and promotion – the controllable set of activities that a firm uses to respond to the wants of its target markets
1. PRODUCT: Creating Value
– A main purpose of marketing is to create value (ex. VOSS water, provides more value to customer) – For example: getting money from your bank using an ATM or teller is an example of a service, where the ATM machine adds value to your banking experience by being conveniently located, fast, & easy to use 2. PRICE: Transacting Value
– Definition: the overall sacrifice a consumer is willing to make – money, time, energy – to acquire a specific product or...
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