Transcript Section 1 PowerPoint Notes

UNIT 1
The World of Marketing:
Chapter 1: Marketing is All
Around Us
Chapter 2: The Marketing Plan
What Is Marketing?
The process of developing,
promoting, and distributing
products to satisfy customers’
needs and wants.
• Products – goods and
services that have
monetary value
• Goods – things you can touch or
hold
• Services – you can’t physically
touch – tasks performed for a
customer
Marketing is based on Exchange
• Marketing connects business’ to
their customers.
Exchange
• An exchange
takes place every
time something is
sold in the
marketplace.
EXCHANGE
When the producer is someone
other than the consumer, some
form of exchange takes place.
Foundations of Marketing
1. Business, Management,
Entrepreneurship
2. Communication and Interpersonal Skills
3. Economics
4. Professional Development
7 Functions of Marketing
• Activities that work together to get
goods and services from producers
to consumers
• Each is essential
Seven Functions of Marketing
1. Distribution
Deciding where and to whom
products need to be sold to reach the
final users.
2. Financing
Getting the money necessary
to operate a business
3. Marketing Information
Management
Getting information to make
sound business decisions.
Usually obtained through
marketing research
For example, after a stay at a
luxury hotel, you fill out a form
rating the service and
accommodations.
4. Pricing
How much to charge to
maximize profits
5. Product Service
Management
• Obtaining, developing, maintaining,
and improving a product or a product
mix in response to market
opportunities.
6. Promotion
Communicating
with potential
customers to
inform, persuade,
or remind them
about a business’s
products
7. Selling
Planned, personalized
communication that
influences purchasing
decisions
When Henry Ford first created the Model T, he
was the only one mass producing cars. He
didn’t have to think about “The Marketing
Concept.” But, as more and more producers
started making cars, they had to think about
what customers need and want in order to
stay in business.
Click on the Model T
Ford to see Henry
Ford’s thoughts about
car color in the early
1900’s.
Imagine if, in today’s world, you
could only buy black. Many
customers would not be very
happy!
Today’s buyer wants a choice!
The Marketing Concept
• If automobile manufactures do not give
their customers a choice (what they want),
they will not stay in business.
• That concept is true for all businesses.
• You must give the customer what they
need and want.
The Marketing Concept
That is what we mean by
The Marketing Concept
Businesses must know
their customers . . .
Businesses must satisfy
customers’ needs and wants in
order to make a profit
Functions of Marketing
• Break up into groups of four (4)
• Choose a product or service, and research and
discuss each of the 7 functions of marketing
for that product or service:
1.
2.
3.
4.
5.
6.
7.
Distribution
Financing
Marketing information management
Pricing
Product/service management
Promotion
Selling
• Be prepared to share with the class
The Importance of Marketing
Chapter 1.2
Examples of Marketing:
• Billboards
• Radio and TV
commercials
• Print advertisements
• Decals on vehicles
• Banners
• Sales
• Customer service
•
•
•
•
•
•
Flyers
Brochures
Web advertising
Word of mouth
Budgets
Company
communication
• Personnel management
The Importance of Marketing
Chapter 1.2
Chapter 1 Section 2
The Importance of Marketing
What You’ll Learn
• The benefits of marketing
• The meaning of economic utility
• The five economic utilities and how to
distinguish the four that are related to
marketing
Economic Benefits of Marketing
• Marketing bridges the gap between you and
the maker or seller of an item
Economic Benefits of Marketing
New and Improved Products -businesses look for opportunities to
please the customer
Economic Benefits of Marketing
Lower Prices – marketing activities add
value and increase demand. When
demand is high, manufacturers can
produce at a lower price. They can sell
at a lower price but increase the
quantity sold. Thus, profits are higher
even though prices are low.
Economic Benefits of Marketing
• It adds VALUE
Added Value = Utility
In economic terms, utility does not mean
your closet or the electric company.
Added Value = Utility
Attributes of a product or service
that make it capable of satisfying
consumers’ wants and needs.
There are five types of Utility:
1. Form Utility
Changing raw materials or putting parts together to make
them more useful – making and producing things.
• Sand into glass
• Wood into paper
• Silk into fabric
2. Place Utility
Having a product where customers can buy it.
It Involves
• Location – may be through a catalog or
at a retailer (actual store) – or, Internet.
• Transporting the product to the
location.
3. Time Utility
Having a product available at a
certain time of year or a convenient
time of day.
• Planning and ordering
• Time of day and week
• Time of year: holidays and
seasons
4. Possession Utility
The exchange of a product for some
monetary value.
Payment may be
made by
•
•
•
•
Cash
Personal checks
Credit cards
Installments
(layaway)
5. Information Utility
Involves communication with the consumer.
• ads
•packaging
• signs
• displays
•owner’s manuals
Which types of utility are related to
marketing?
Form utility is a
function of
production, NOT
marketing
These utilities ARE directly related
to marketing:
•
•
•
•
Place
Time
Possession
Information
Fundamentals of Marketing
Chapter 1 Sec. 3
• Market – all potential customers who have
the ability and willingness to buy
Consumer Markets
• Consist of
consumers who
purchase goods
and services for
personal use.
Industrial Markets
• Business-to-business (B-to B) markets include
all businesses that buy products for use in
their operations.
Market Share
• A company’s percentage of the total sales
volume generated by all companies that compete
in a given market.
Target Marketing
Focusing all decisions on a very
specific group of people who you want
to reach.
Customer Profile
• To develop a clear picture of their target market,
businesses create a customer profile.
• It lists information about the target market, such
as age, income level, occupation, attitudes,
lifestyle, and geographic residence
• Customers –
people who
buy the product
• Consumers –
people who
actually use the
product
Is mom the customer or the
consumer? The kids?
Marketing Mix
Basic marketing strategies
– the four P’s
•
•
•
•
Product
Place
Price
Promotion
Product Strategies
•
•
•
•
What product to make
How to package it
What brand name to use
What image to project
Place Strategies
• How and where
a product will be
distributed.
Price Strategies
• Reflect what customers are willing and
able to pay.
Promotion Strategies
• How potential customers will be told about the
new product
• What the message will be
• When and where it will be delivered
• What inducements are there to buy
The Marketing Mix
The elements are interconnected
Product
Place
Price
Promotion
The Marketing Mix – The 4 P’s
• Contains countless alternatives.
• Management must select a combination of
marketing mix decisions that will satisfy target
markets and achieve organizational goals.