Unit 1

1. Unit 1 The World of Marketing

2. Marketing (AMA) • Marketing is the activity, set of institutions, and process for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large. • It involves the process of planning, pricing, promoting, selling, and distributing ideas, goods, or services to create exchanges that satisfy customers.

3. Marketers track trends. • What trends have you noticed in your experience as a teenager?

4. Ideas, Goods, and Services • These are all a type of offering • Goods- Tangible items that have monetary value and satisfy your needs and wants. • Services- Intangible items that satisfy your needs and wants • Ideas- Example politicians offer ideas in hopes of getting your vote. • ALL OF THE ABOVE ARE MARKETABLE!

5. Name 3 examples of Goods and services? Goods Services

6. Seven Marketing Core Functions • Channel Management • Marketing Information Management • Market Planning • Pricing • Product/Service Management • Promotion • Selling

7. Channel Management • The process of deciding how to get the goods into customer’s hands. • Physically moving and storing goods is a part of distribution planning • Main methods of distribution include: • Truck, Rail, Ship, or Air. • Distribution also involves the systems that track products • End Goal: Find the best way to get the product into the customer’s hands based on his or her purchasing methods.

8. Marketing Information Management • Good information about customers, trends, and competing products is essential for a businesses marketing strategy • Researching habits and attitudes, where customers live, and other trends in the marketplace and pop culture help marketers create a plan for their products.

9. Market Planning • Understanding the concepts and strategies used to develop and target specific marketing strategies to a select audience. • This requires in-depth knowledge of activities that involve determining information needs, designing data-collection processes, collecting data, analyzing data, presenting data, and using that data to create a marketing plan. • A good plan includes methods for reaching different types of customers.

10. Pricing • This focus in marketing decides how much to charge for goods and services in order to make a profit. • These decisions are based on: • Costs of materials • Competitors Price • An estimate on what customers are willing to pay

11. Product/Service Management • Obtaining, developing, maintaining, and improving a product or a product mix in response to market opportunities. • Research and New Technology influence product and service development

12. Promotion • An effort to inform, persuade, or remind current and potential customers about a business’s products or services. • Channels of Promotion • TV • Radio • Internet • ? • ? • ?

13. Selling • Provides customers with the goods and services they want. • This includes B-2-B, B-2-C sales • Selling techniques include: • Determining client needs and wants • Using planned, personalized communication • Establishing a business relationship that encourages multiple/future purchases beyond an initial purchase.

14. The Marketing Concept • The idea that a business should strive to satisfy a customers’ needs and wants while generating a profit for the business. • Focus on the customer • The Concepts holds that the desires and needs of the target market must be determined, anticipated, and satisfied in order to achieve the goals of the producer. • Best way to satisfy is to stay in touch with the customer and monitor their purchasing behavior!

15. Customer Satisfaction is Most important! • CRM(Customer Relationship Management) • #1 aspect of marketing in 21st Century • Combines customer information with customer service and marketing communications to become more effective in their marketing plan • Simply put it’s a better way to know your customers, giving you an edge on providing a product they will buy

16. End of Section Instructions • Note: Please write your answers on a sheet of paper and turn into your class box when you are done!

17. Question 1 • Choose a product based on it’s marketing strategy that targets a person who is 20, 40, 60, and 80 years old • Then describe in detail one of the seven core marketing functions that each product displays. • ex:

18. Question 2 • With a partner identify 2 businesses that cater to teenagers. One business should sell goods and the other services. • Use the seven Marketing Functions to explain how each business caters to its customers. • How effective are those businesses in satisfying their customers’ needs and wants? Develop a rating scale to present your findings

19. Chapter 1 Sections 2 and 3 The Importance and Fundamentals of Marketing

20. Economic Impact of Marketing • A global force that provides the means for competition to happen in the world’s marketplace. • This drives product prices lower benefiting the customer trying to purchase the best product at the lowest price. • This also encourages companies to continually make something better “BASF” • “We don’t make a lot of the things you buy, we make a lot of the things you buy, better!”

21. Lower Prices • Marketing Activities increase demand and this in a round about way helps to lower prices, because producers will make more of a product than they originally intended. • Producing a higher quantity of goods will lower the cost of production per unit. • Please view the example on the next slide

22. Lower Cost Example • Scenario 1 • 1500 Units with $300,000 fixed costs • 300,000/1500 units = $20.00/unit • Scenario 2 • 15,000 Units with $300,000 fixed costs • 300,000/15,000 = $2.00/unit • So lets say the company charges $95.00 for scenario 1, in Scenario 2 they can lower their price to $77.00 because the cost/unit is lower

23. Utility • Attributes of goods and services that make them capable of satisfying customers’ wants and needs. Marketing consists of 5 elements of Utility

24. Form Utility • Changing raw materials into usable goods

25. Place Utility • Having a product where customers can buy it. (Want it to be most convenient and efficient for consumer)

26. Time Utility • Have a service or product available during a certain time of the year or a certain time of day.

27. Possession Utility • The exchange of a product for money is possession utility.

28. Information Utility • Communication with consumer Sales people, flyers, billboards, and packaging along with owner’s manuals provide information about the product to the customer.

29. Fundamentals of Marketing All the people who share similar needs and wants and who have the ability to purchase a given product are a market.

30. Consumer Market • Consists of consumers who purchase goods and services for personal use. (B-2-C) • A few categories of consumer lifestyles for these goods and services include: • Save them money • Make life easier • Improve appearance • Create status in the community • Provide Satisfaction

31. Organizational Market • B-2-B Market • Includes all businesses that buy products for use in their operations. • Goals of businesses (most relate to improving profits): • Increase Productivity • Increase Sales • Decrease Expenses • Increase Efficiency

32. Note of interest • Wholesalers: • Must have a plan for both Consumer and Organizational Markets.

33. Market Share • The percentage of the total sales volume generated by all companies that compete in a given market. It may be represented in dollars or units • This helps companies analyze their competition as well as their status in a given market. • Change all the time, larger the share the more able a company is to take risks, like developing new products that are more adventurous to continue its dominance in the market share.

34. Market Segmentation • Breaking down the market into small groups that have similar characteristics. • More specifically classifying customers by groups. • After establishing groups marketers realize that multiple groups by the same/similar products, which helps them fine tune their approach in a given market.

35. Target Market • This is the goal of Market Segmentation • Identifying the group of people most likely to become customers. • All marketing strategies are directed toward a company’s target market. • Without a target the marketing plan lacks focus. • Multiple target markets do happen. • Ex: Cereal for both children and parents!

36. Customer Profiles • List information about the target market • Age, • Gender, • Income Level, • Marital Status, • Ethnic Background, • Geographic Residence • Attitudes • Lifestyle • Behavior • What would you name the target Market you are in?

37. Marketing Mix

38. Product • Starts with what to make? • Continues with what should it look like? • Then more specifically a company chooses: • Brand Name • Packaging • Service • Warranty • Possible updates • By developing new uses or identifying new target markets the life of a product can be extended.

39. Price • What is exchanged for the product • Considerations include • What consumers are willing to pay • Competition prices • Price to resellers • MSRP (Automobiles) • Organizational Price (credit terms, discounts, allowances, and payment periods)

40. Place • The mean’s of getting the product into the customer’s hands. • Globally which products will be sold in which countries? • E-commerce

41. Promotion • Activities related to advertising, personal selling, sales promotion, and publicity. • Social media is a huge promotional advantage • Strategies for telling customers about a product include: • Which media selected • The Message • Special Offers • Timing of Promotional Campaigns