Transcript Introduction to the Course, Overview of Strategic Marketing

Chapter 1
Defining Marketing for
the Twenty-First
Century
PowerPoint by Karen E. James
Louisiana State University - Shreveport
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 0 in Chapter 1
Objectives
 Understand the new economy.
 Learn the tasks of marketing.
 Become familiar with the major
concepts and tools of marketing.
 Understand the orientations
exhibited by companies.
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 1 in Chapter 1
Objectives
 Learn how companies and
marketers are responding to
new challenges.
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 2 in Chapter 1
The New Economy
 Consumer benefits from the digital
revolution include:
– Increased buying power.
– Greater variety of goods and services.
– Increased information.
– Enhanced shopping convenience.
– Greater opportunities to compare product
information with others.
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 3 in Chapter 1
The New Economy
 Firm benefits from the digital
revolution include:
– New promotional medium.
– Access to richer research data.
– Enhanced employee and customer
communication.
– Ability to customize promotions.
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 4 in Chapter 1
Marketing Tasks
 Marketing practices may pass
through three stages:
– Entrepreneurial marketing
– Formulated marketing
– Intrepreneurial marketing
 As marketing becomes more
formulated, creativity is inhibited.
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 5 in Chapter 1
What Can Be Marketed?
 Goods
 Places
 Services
 Properties
 Experiences
 Organizations
 Events
 Information
 Persons
 Ideas
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 6 in Chapter 1
Marketing Defined
 Kotler’s social definition:
“Marketing is a societal process by
which individuals and groups
obtain what they need and want
through creating, offering, and
freely exchanging products and
services of value with others.”
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 7 in Chapter 1
Marketing Defined
 The AMA managerial definition:
“Marketing is 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.”
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 8 in Chapter 1
Core Marketing Concepts
 Target markets and
market segmentation
 Exchange and
transactions
 Marketplace, marketspace, metamarkets
 Relationship and
networks
 Marketers & prospects
 Marketing channels
 Needs, wants, demands
 Supply chain
 Product offering and
brand
 Competition
 Value and satisfaction
 Marketing program
©2003 Prentice Hall, Inc.
 Marketing environment
To accompany A Framework for Marketing Management, 2nd Edition
Slide 9 in Chapter 1
Core Marketing Concepts
 Target markets & segmentation
– Differences in needs, behavior,
demographics or psychographics
are used to identify segments.
– The segment served by the firm is
called the target market.
– The market offering is customized
to the needs of the target market.
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 10 in Chapter 1
Core Marketing Concepts
 Shopping can take place in a:
– Marketplace (physical entity, Lowe’s)
– Marketspace (virtual entity, Amazon)
 Metamarkets refer to complementary
goods and services that are related
in the minds of consumers.
 Marketers seek responses from
prospects.
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 11 in Chapter 1
Core Marketing Concepts
 Needs describe basic human
requirements such as food, air, water,
clothing, shelter, recreation, education,
and entertainment.
 Needs become wants when they are
directed to specific objects that might
satisfy the need. (Fast food)
 Demands are wants for specific
products backed by an ability to pay.
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 12 in Chapter 1
Core Marketing Concepts
 A Product is any offering that can
satisfy a need or want, while a brand
is a specific offering from a known
source.
 When offerings deliver value and
satisfaction to the buyer, they are
successful.
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 13 in Chapter 1
Enhancing Value
 Marketers can enhance the value of
an offering to the customer by:
– Raising benefits.
– Reducing costs.
– Raising benefits while lowering costs.
– Raising benefits by more than the
increase in costs.
– Lowering benefits by less than the
reduction in costs.
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 14 in Chapter 1
Core Marketing Concepts
 Exchange involves obtaining a desired
product from someone by offering
something in return. Five conditions
must be satisfied for exchange to occur.
 Transaction involves at least two things
of value, agreed-upon conditions, a time
of agreement, and a place of agreement.
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 15 in Chapter 1
Core Marketing Concepts
 Relationship marketing aims to
build long-term mutually satisfying
relations with key parties, which
ultimately results in marketing
network between the company and
its supporting stakeholders.
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 16 in Chapter 1
Core Marketing Concepts
Marketing Channels
 Communication
channels
 Distribution
channels
 Service channels
©2003 Prentice Hall, Inc.
 Deliver messages to
and receive
messages from
target buyers.
 Includes traditional
media, non-verbal
communication, and
store atmospherics.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 17 in Chapter 1
Core Marketing Concepts
Marketing Channels
 Communication
channels
 Distribution
channels
 Display or deliver
the physical
products or
services to the
buyer / user.
 Service channels
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 18 in Chapter 1
Core Marketing Concepts
Marketing Channels
 Communication
channels
 Distribution
channels
 Carry out
transactions with
potential buyers
by facilitating the
transaction.
 Service channels
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 19 in Chapter 1
Core Marketing Concepts
 A supply chain stretches from raw
materials to components to final
products that are carried to final
buyers.
 Each company captures only a
certain percentage of the total value
generated by the supply chain.
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 20 in Chapter 1
Core Marketing Concepts
 Four levels of competition can be
distinguished by the level of product
substitutability:
– Brand competition
– Industry competition
– Form competition
– Generic competition
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 21 in Chapter 1
Core Marketing Concepts
 The following forces in the broad
environment have a major impact on
the task environment:
– Demographics
– Economics
– Natural environment
– Technological environment
– Political-legal environment
– Social-cultural environment
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 22 in Chapter 1
Core Marketing Concepts
 The marketing program is developed
to achieve the company’s objectives.
Marketing mix decisions include:
– Product: provides customer solution.
– Price: represents the customer’s cost.
– Place: customer convenience is key.
– Promotion: communicates with customer.
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 23 in Chapter 1
Company Orientations
 The orientation or philosophy of the
firm typically guides marketing efforts.
Several competing orientations exist:
– Production concept
– Product concept
– Selling concept
– Marketing concept
– Customer concept
– Societal marketing concept
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 24 in Chapter 1
The Marketing Concept
 Achieving organizational goals requires
that company be more effective than
competitors in creating, delivering, and
communicating customer value.
 Four pillars of the marketing concept:
– Target market
– Customer needs
– Integrated marketing
– Profitability
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 25 in Chapter 1
Changes in the Marketplace
 Globalization, technological
advances, and deregulation have
created many challenges:
– Customers
– Brand manufacturers
– Store-based retailers
 Both companies and marketers have
been forced to respond and adjust.
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 26 in Chapter 1