Transcript File - Introduction to Business

MARKETING
1.1 An Introduction to
Marketing
Intro to Marketing BMI3C1
September 2009
Business Studies and Computer Science Department
Prepared by: T. Nephin
Page 1
MARKETING
What is Marketing?
• Marketing is the sum of all the activities involved in the
planning, pricing, promoting, distributing and selling of
goods and services to satisfy consumers’ needs and wants
• Connects Suppliers to End Users
Suppliers
Supplier
End Users
Item Marketed
End User
Manufacturers
Products
Consumers
Service Businesses
Expertise
Potential Customers
Politicians
Ideas
Potential Voters
Not-for-Profit Organizations
Cause
Benefits
Potential Donors
Potential Clients
Individuals
Skills & Abilities
People and Organizations.
Business Studies and Computer Science Department
Prepared by: T. Nephin
Page 2
MARKETING
Marketing
• Comes from the word ‘market’, which is used in two ways
• For example General Motors markets cars to consumers by
advertising their benefits
• Marketing also refers to the potential buyers or end users of
the product.
• Coca-Cola is in the ‘soft drink market’ and markets several
products
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Cola
Diet cola
Sprite
Minute Maid to different consumers ( or market segments)
• The ‘soft drink market’ is just a segment of the total beverage
market that includes water, juice, coffee, teas, liquors, malts,
etc…
Business Studies and Computer Science Department
Prepared by: T. Nephin
Page 3
MARKETING
An Important Business
Activity
– Can lead to the success or failure of a business activity
– Just think of the Movies and Music released this year
• Only some are hits, why?
• Part of the reason for their success is marketing.
Business Studies and Computer Science Department
Prepared by: T. Nephin
Page 4
MARKETING
The Marketing Plan
• Profit making companies want to make profits
• Charities want to raise money for their causes
• The first step in marketing anything is to determine a goal
for the company or organization
• After identifying the goal a marketing plan can be
developed
• A marketing plan consists of different parts referred to as
the “Marketing Mix” (sometimes called the 7P’s )
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Product
Price
Place
Promotion
People
Processes
Physical Environment.
Business Studies and Computer Science Department
Prepared by: T. Nephin
Page 5
MARKETING
The Product
• Refers to the item being sold by the business or
organization
• Products
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Snack foods
Automobiles
Sporting goods
Clothing
• Services
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Postal services
Accounting services
Legal services
Services provided by trades people.
Business Studies and Computer Science Department
Prepared by: T. Nephin
Page 6
MARKETING
Product Marketing
Strategies
Methods used to improve/differentiate the product
and increase sales or to target sales more effectively
to gain a competitive advantage
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Design
Technology
Usefulness
Convenience
Value
Quality
Packaging
Branding
Accessories
Warranties.
Business Studies and Computer Science Department
Prepared by: T. Nephin
Page 7
MARKETING
Price
• Generally refers to the selling price for the goods or
services
• Must cover
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Raw materials
Salaries
Advertising
Other operating expenses
Profits
• Setting price is not easy
– Set too high and consumers may not buy
– Set too low and consumers may think it is cheap or poorly
made
– If the price is too attractive, too many people will want the
good or service leading to a shortage to satisfy demand and
therefore lost sales
– Takes a good deal of planning and thought.
Business Studies and Computer Science Department
Prepared by: T. Nephin
Page 8
MARKETING
Price Marketing Strategies
When pricing your products it is important to:
• know your market
• Know the price elasticity of the product
• keep an eye on your rivals
Strategies include:
• Price Skimming
• Penetration Pricing
• Psychological Pricing
• Cost-Plus Pricing
• Loss Leader Pricing.
Business Studies and Computer Science Department
Prepared by: T. Nephin
Page 9
MARKETING
Place
• Refers to the location where the companies goods or
services are sold
• Should they be where the customers go?
– Stores
– Vending machines
• Should the salesperson go to the customer?
– Door-to-door sales
– Scalping tickets
• Place also refers to how the goods and services get from
the supplier to the customer through “channels of
distribution”
– The use of computers and telecommunications equipment have
improved the channels of distribution.
Business Studies and Computer Science Department
Prepared by: T. Nephin
Page 10
MARKETING
Channels of Distribution
Channel of Distribution
Example
Producer to Consumer
Buying corn at a road side stand from a
farmer
Producer(Manufacturer) to Consumer
A shoe company selling to consumers in a
factory direct store (shoes)
Producer to Retailer to Consumer
Farmer sells Produce to Independent
Grocer who sells it to store shoppers
Producer(Manufacturer) to Wholesaler to
Retailer to Consumer
Levis makes jeans, sells them to a
wholesaler, who sells them to Sears who in
turn sell them to the shopper
Business Studies and Computer Science Department
Prepared by: T. Nephin
Page 11
MARKETING
Place Marketing Strategies
The more places to buy the product and the easier it is
made to buy it, the better for business
Place strategies include:
•Retail
•Wholesale
•Mail Order
•Internet
•Direct Sales
•Peer to Peer
•Multi-channel.
Business Studies and Computer Science Department
Prepared by: T. Nephin
Page 12
MARKETING
Promotion
Includes all the marketing activities that communicate the
organizations’ message to the consumer about the goods and
services being sold
The main promotional strategies include:
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Special Offers
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Personal selling
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Advertising
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Endorsements
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User Trials
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Leaflets/Posters
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Free Gifts
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Competitions
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Direct Mailings.
Business Studies and Computer Science Department
Prepared by: T. Nephin
Page 13
MARKETING
People
People represent the business:
• The image they present is important
• First contact with the customer is often human –lasting
first impression
• Extent of the training and knowledge of the product is
important
• Mission Statement – how relevant, and do employees buy
into it
• Do staff represent the desired culture of the business?
People Marketing Strategies include:
• Employees
• Management
• Culture
• Customer service.
Business Studies and Computer Science Department
Prepared by: T. Nephin
Page 14
MARKETING
Processes
• Are especially relevant in the service industries
• Deal with the processes people must go through to acquire
the service
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The Marketing Strategies deal with:
Contacts
Reminders
Registration
Subscription
Form Filling
Use of technology.
Business Studies and Computer Science Department
Prepared by: T. Nephin
Page 15
MARKETING
Physical Environment
The ambience, mood or physical presentation of the business
environment is important to sell goods and services
•Marketing Strategies dealing with the physical environment
deal with:
•Appearance
– Trendy, retro, modern, old fashioned
•Colours
– Light, dark, bright, subdued
•Neatness and cleanliness
•Music
•Smell.
Business Studies and Computer Science Department
Prepared by: T. Nephin
Page 16
MARKETING
A Companies Marketing Mix
Blend of the mix depends upon:
• The Marketing Objectives
• Type of Product
• Target Market
• Market Structure
• Rivals’ Behaviour
• Global Impact – culture, religion etc…
• Marketing Position
• Product Portfolio
– Product Lifecycle
– Boston Matrix
Business Studies and Computer Science Department
Prepared by: T. Nephin
Page 17