Transcript THE CHANGE IN MARKETING - Southern Methodist University

What is Marketing?
Professor Chip Besio
Cox School of Business
Southern Methodist University
What Is Marketing?
 Marketing
is [the] “process by
which individuals and groups
obtain what they need and want
through creating, offering, and
exchanging products of value with
others [Italics mine].”
***Philip Kotler
What Is Marketing?
 Marketing
is the activity for creating,
communicating, delivering and
exchanging offerings that benefit an
organization’s customers, the
organization, its stakeholders and
society at large.
***The American Marketing Association (2007)
What Is Marketing?
 Marketing
is so basic that it cannot be
considered a separate function. It is
the whole business seen from the point
of view of its final result, that is, from
the customer’s point of view [Italics
mine].
***Peter Drucker
Marketing Mix -- The Four P’s
RICE
ROMOTION
LACE
RODUCT
The Marketing Mix - Product
 Product
line breadth and depth
 Product characteristics (e.g., quality,
features, design, reliability)
 Brand
 Packaging
 Services
 Return and/or warranty policies
The product is much more than the
tangible item that the customer sees
The Marketing Mix - Price
 List
price
 Discounts
 Bundling
 Terms (e.g., 2/10, net 30)
 Credit
Price includes the tools that determine
how much and when the customer pays
The Marketing Mix - Promotion
 Advertising
 Sales
promotion
 Direct marketing
 Public relations
 Personal selling
 Promotion (what many people commonly think of
as marketing) includes all communications with
potential customers that are intended to influence
their attitudes, beliefs and purchase decisions
The Marketing Mix - Place
 Shelf
location
 Display
 Inventory
 Distribution channels
 Transportation
 Territory or coverage
Place involves how and when the
customer gets the product
Marketing Mix - Summary
Marketers have many more tools at
their disposal to achieve company
objectives than you might have
thought
The Company’s Micro
Environment - The 5 Cs
 The
“5 Cs” can be used as a framework
to describe and analyze the company’s
immediate environment
 Company
 Customers
 Competitors
 Channels
 Constituents
The Company’s Micro
Environment
Company’s
Internal Environment -
functional areas such as top management,
finance, and manufacturing, marketing, etc.
Customers
- buyers in markets that purchase
a company’s goods and services
Competitors
- those who serve the target
market with similar products/ services
The Company’s Micro
Environment
Channels
(Suppliers, Distributors,
Wholesalers and Retailers) - Provide
the resources needed to produce goods
and services and help the company to
promote, sell, and distribute to final buyers
Constituents
(stakeholders) - any
group that perceives itself having an
interest in the company’s ability to
achieve its objectives
The Company’s Macro
Environment

Beyond the channel of distribution there are
other environmental factors that impact on
the company and its market
 Among them are:
 Society/Culture - e.g., dual income
households are less likely to prepare meals in the
home
 Economy - e.g., recession reduces discretionary
spending by consumers, as well as investments
by competitors and suppliers
 Natural Environment – e.g., resources needed
by marketers
The Company’s Macro
Environment

Among them are (continued):
 Demographics - e.g., the aging population
dictates that more incontinence products will be
needed in the future
 Legal/Regulatory - e.g., EPA regulations
regarding hazardous waste disposal could affect
the demand for motor oil and batteries
 Technology - e.g., low cost, high speed
computers could allow quicker, more effective
dissemination of information to the sales people
and widely dispersed business units
What Is S.W.O.T. Analysis?
S.W.O.T. analysis groups observations of the
company and its environment into:

Internal
 Strengths
 Weaknesses

External
 Opportunities
 Threats
What Is S.W.O.T. Analysis?

Strengths and weaknesses are factors
specific to company which contribute to
either good performance (strengths) or poor
performance (weaknesses).

Microsoft example:


Strengths - Scale, excellent development
capability; Windows OS as a basis for
development and product tie-ins; reputation with
end users for ease of use
Weaknesses - Reputation for “vaporware;”
broad scope makes focus on niches difficult
What Is S.W.O.T. Analysis?

Opportunities and threats are based on the
activities in the company’s environment by
others, including customers, competitors and
suppliers and other constituents.
 Examples include:

Opportunities - Increasing computing power;
increasing penetration of PCs and handhelds;
increasing availability and speed of internet access;
bundling different software products

Threats - Government antitrust action; power of Intel
as dominant supplier of microprocessors;
investment by telephone and cable companies in
internet “distribution”
What Is S.W.O.T. Analysis?
The same information can often be viewed
as either an opportunity or a threat
Consider the company’s current position
and determine the most likely effect
(positive or negative) of the information