Transcript Marketing, Chapter 2 - Cole

Can you find the 9 steps of marketing in this picture?
Purchasing – Selling – Pricing – Product Planning – Risk Management Promotions – Financing – Distribution – Marketing Information Management
Chapter 2
Basic Marketing Concepts
I. The Marketing Concept
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To make a profit, a business must focus all of
its efforts on satisfying the needs and wants of
its customers. (or someone else will!)
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Companies shifted their focus from being Sales oriented to being
Marketing oriented.
•Consumers vs. Customers:
•One buys a product, one uses it.
•How might this complicate the cereal marketer’s task?
Marketing is NOT an exact science!
• Kix, the first "puffed" cereal, was introduced in
1937 by the General Mills cereal company. Their
slogan is "Kid-Tested, Mother-Approved!"
•Customer Satisfaction:
•You want to create Value: the personal satisfaction gained from the use
of a good/service. Consumers compare the price they pay for a product
with all the benefits that come with it.
•Ranges from support services offered to how customers are treated.
•Value is NOT defined by a business; its by the CUSTOMER!
•Creates brand loyalty and a relationship with the customer.
•This is what brings customers back.
Identify Your Customers
“To respond to customers needs and preferences,
businesses need to know them”
• Market: the group of all potential customers
who are willing and able to buy and share
common needs/wants.
– Who are they?
With this knowledge you have a better ability to promote your
product using print, radio or television, for example.
Mass Marketing: single marketing plan
to reach all consumers.
Good Product Candidates
for this approach?
•Universal Appeal
•Few Features
$2 billion chewing gum market: some chew, some don’t
Wrigley’s markets their product to people who chew gum and at
the same time, look for opportunities to attract new customers
What could be one of these opportunities?
Market Segmentation
• Dividing the total market into smaller groups of people
who share specific needs & characteristics
Mass marketing from the 50’s & 60’s, mainly due to WWII shortages
shifted to Market Segmentation
Nowadays, there is a glut of products/services, so companies have to
target to more specific groups of potential customers to be
successful.
This allows businesses to customize their products/services and their
marketing strategies.
There are 4 different Market Segmentation Methods.
Geographics
• A market based on where people live
– Local, regional, national, global
Snow shovels in Florida?
Demographics
• Statistics that describe a population in
terms of personal characteristics.
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Age
Gender
Income
Ethnic background
Education
Occupation
Can more than one area be used at one time?
Psychographics
• Study of consumers based on lifestyle, and the
attitudes and values that shape it.
• People who share interests & activities tend to
have similar attitudes about products.
Product Benefits
• Companies build beneficial features in their
products in response to consumers wants & needs.
Customer Profile
• When you combine geographic, demographic &
pyschographic data, a complete picture of who a
perspective customer is begins to emerge.
See the charts on page 20
Reaching Your Customers
• Target Marketing: focusing all marketing
decisions on the specific group(s) of people you
want to reach.
• The more information you have on your target
market, the easier it is to make your marketing
decisions.
The 4 P’s
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The for basic marketing decisions to reach
your target market:
1. Product:
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What to make, how to package, what brand name to
use & what image
2. Place:
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How & where a product will be distributed
3. Promotion
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How potential customers will be told about the new
product – what the message will be, where & when to
get it and with what inducements to buy it.
4. Price:
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What customers are willing & able to pay
Positioning Your Product
• Try to get customers to think of your product or
service in a certain way; you especially want to
be distinguished from your competition.
• Positioning is NOT permanent. It will change
with time.
• How do marketers decide on where to position
their products?
1. Play to the competitions
weaknesses
• Tylenol once used the
position of:
– for those that can’t take
aspirin.
– It won’t upset your stomach
like aspirin does.
2. Look for Underserved Markets
• “Holes” in the marketplace.
• What consumers needs & preferences are not
being addressed?
• Are there any potential customers who are not
being reached?
3. Lead With Your Strengths
• Businesses that are the market leaders will often
use that strength to position its products.
4. Target Different Market
Segments
• Many marketers position their products by
targeting different market segments. Who are the
target markets for the following:
Putting it all together
• A low fat ice cream to fit between fat free and
regular.
Target Market: People who are health
conscious, but not dieters
Product: an ice cream with ½ the fat of
regular ice cream
Place: Supermarket freezers
Price: about $4 a ½ gallon
Promotion:
Deliciously Satisfying. Half the fat
and 20% fewer calories than regular ice cream
REVIEW
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Marketing Concept
Customers/consumers
Customer satisfaction/value
Market
Mass marketing
Market segmentation
Target market
4 “P’s”
Ways to Position a Product