Transcript market - Entrepreneurship @PresUniv

INTRODUCTION TO
PRINCIPLES OF MARKETING
Definitions of marketing
‘Marketing is the management process that
identifies, anticipates and satisfies
customer requirements profitably’
The Chartered Institute of Marketing
‘The right product, in the right
place, at the right time, and at
the right price’
Adcock et al
‘Marketing is the human activity
directed at satisfying human needs
and wants through an exchange
process’
Kotler 1980
‘Marketing is a social and managerial
process by which individuals and
groups obtain what they want and
need through creating, offering and
exchanging products of value with
others’
Kotler 1991
Marketing

It is a social and managerial process by
which individuals and groups obtain what
they need and want through creating and
exchanging products and value with
others.
Five competing concepts
 Production
Concept
 Product Concept
 Selling Concept
 Marketing Concept
 Societal marketing Concept
Production Concept
 It
holds that consumers will favor
those products that are widely
available and low in cost.
 Managers of production-oriented
organizations concentrate on
achieving high production
efficiency and wide distribution
coverage.
Product Concept
 It
holds that consumers will favor
those products that offer the
most quality, performance, and
features.
 Managers in these productoriented organizations focus their
energy on making good products
and improving them over time.
Selling Concept
 It
holds that consumers, if left
alone, will ordinarily not buy
enough of the organization’s
products. The organization must
therefore undertake an aggressive
selling and promotion effort.
Marketing Concept
 It
holds that the key to achieving
organizational goals consists in
determining the needs and wants
of target markets and delivering
the desired satisfactions more
effectively and efficiently than
competitors.
Societal Marketing Concept

It holds that the organization’s task is to
determine the needs, wants, and interests
of target markets and to deliver the
desired satisfactions more effectively and
efficiency than competitors in a way that
preserves or enhances the consumer’s
and the society’s well-being.
Four Pillars of Marketing Concept
 Market
Focus/ Target Market
 Customer Orientation
 Coordinated marketing
 Profitability.
Market Focus/Target Market
 No
company can operate in every
market and satisfy every need. Nor
can it even do a good job within a
broad market.
Customer Orientation

It requires the company to carefully define
customer needs from the customer point
of view, not from its point of view. Every
product involves trade-offs, and
management cannot know what these are
without talking to and researching
customers.
Coordinated Marketing
 First, various
marketing functions –
sales force, advertising, marketing
research, etc. – must be coordinated
among themselves.
 Second, marketing must be well
coordinated with the other
departments in the company.
Profitability
 The
major goal of private firms is
profit, for nonprofit, it is surviving
and attracting enough funds to
perform their work.
 A company makes money by
satisfying customer needs.
Comparison of Selling and Marketing
Concepts
SELLING CONCEPT
Starting Point
Factory
Focus
Means
Ends
Products
Selling and
Profits through
Promoting
Sales volume
MARKETING CONCEPT
Market
Customer
Coordinated Profits through
Needs
Marketing
Customer
Satisfaction
Marketing Management in the 21st
Century
OLD PRACTICES
 Was using tactics

Built sales through
advertising
RECENT CHANGES
 Now focused on
Marketing strategies
 Now build brands
through a coordinated
integrated marketing
strategy that involves all
points of contact
between the company
and the public
RECENT CHANGES
OLD PRACTICES




Focused on short-term
profitable transactions
Company was the unit of
analysis

Was organized by product
units
Segmented on geographic or
demographic variables



Now look at Customer’s
lifetime value
Now the whole value chain
is the unit of analysis,
meeting the end customers’
needs
Now organized by customer
segment
Segmented in depth using all
relevant variables, especially
behavioural variables like
usage rate, loyalty or benefit
RECENT CHANGES
OLD PRACTICES

Focused on capturing
new customers

Performance is
measured by financial
metrics
Focused on satisfying
stockholders
 Marketing department
does the marketing

Gives emphasis on
keeping existing
customers
 Performance is now
measured by financial,
strategic, and
marketing metrics
 Satisfy stakeholders
 Everyone in the
company does some
marketing

RECENT CHANGES
OLD PRACTICES
Was individual and
hierarchal work
structures
 Developing and
implementing a
marketing plan took
years


Now Cross functional
teams

Now it takes months
(or weeks)
Marketing in the 21st Century
Network Marketing
 E-Commerce
 Email Marketing

Marketing Essentials
n Chapter 2 Basic Marketing Concepts
Section 2.1 The Marketing Concept
24
SECTION 2.1
The Marketing Concept
What You'll Learn
 The marketing concept
 The difference between customers and consumers
 What a market is and how it can be described
 The four Ps of the marketing mix
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SECTION 2.1
The Marketing Concept
Why It's Important
In order to participate in the world of marketing, you'll want
to understand how businesses focus on the needs and
wants
of their customers in order to improve their products, remain
competitive, and increase sales.
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SECTION 2.1
The Marketing Concept
Key Terms
 marketing concept
 customer
 consumer
 market
 target marketing
 customer profile
 marketing mix
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SECTION 2.1
The Marketing Concept
The Basic Concept
The marketing concept states that businesses must
satisfy customers' needs and wants in order to make a
profit.
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SECTION 2.1
The Marketing Concept
Customers vs. Consumers
Customers buy a product.
Consumers use the product.
 Example: Parents who buy video games
from retailers are customers. The kids who
play the video games are the consumers.
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SECTION 2.1
The Marketing Concept
What is a Market?
A market is all potential customers who share common
needs and wants and who have the ability and willingness to
buy the product.
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SECTION 2.1
The Marketing Concept
U.S. Game Console Market
A market can be described as
the people who are potential
customers of a product, as
well as by the classification
of a product in a category.
Would you be considered
part of the market for game
consoles? Why or why not?
What other markets are you
part of?
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SECTION 2.1
The Marketing Concept
The Marketing Mix
The marketing mix comprises four basic marketing
strategies known as the four Ps:
 Product
 Place
 Price
 Promotion
Slide 1 of 3
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SECTION 2.1
The Marketing Concept
The Marketing Mix
Product strategies include what product to make, how to
package it, what brand name to use, and what image to
project.
Place strategies deal with how and where a product will be
distributed.
Slide 2 of 3
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SECTION 2.1
The Marketing Concept
The Marketing Mix
Price strategies should reflect what customers are willing
and able to pay.
Promotion strategies deal with how potential customers
will be told about the new product, what the message will
be, when and where it will be delivered, and with what
inducements to buy.
Slide 3 of 3
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SECTION 2.1
The Marketing Concept
Target Marketing
Target marketing is focusing all marketing mix decisions
on the specific group of people you want to reach.
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2.1
ASSESSMENT
Reviewing Key Terms and Concepts
1. What does the marketing concept state?
2. Who are the customers of Sony Electronics
and Hershey Chocolates? Who are their
consumers?
3. What is a market?
4. What is target marketing?
5. What are the four Ps of the marketing mix?
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2.1
ASSESSMENT
Thinking Critically
Many women's magazines like Glamour and Elle publish
advertisement for men's cologne. Explain the rationale for this
practice.
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2.1
Graphic Organizer
The Marketing Mix
The Marketing Concept
Marketing Research
Product
Marketing Segmentation
Price
Place
Consumers
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Promotion
Marketing Essentials
End of Section 2.1
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Marketing Concept
“..The Marketing Concept
means that an organization
aims ALL its efforts at
satisfying its customers...”
“… give the customers what they
need/want seems so obvious”
the Marketing Concept
All of the people in the company aim all efforts to satisfy the
customer.
1. Customer satisfaction
2. A total company effort
3. Profit (not just Sales) as an objective