12th edition

1. Marketing Overview Prof. Bill White Mkt 304 Principles of Marketing 12th edition

2. 1 Chapter An Overview of Marketing After this session you should be able to explain: • Exchange and marketing. • Business and nonbusiness marketing. • The evolution of marketing. • The marketing concept. • Ethics and marketing. • The marketing program. • The influence of marketing

3. The Marketing Concept • Coordinating the total resources of an organization • Toward the identification and satisfaction of customer needs and wants • In a way planned to enhance profits and/or success. • “Find (or create) a need and fill it (at a profit).

4. Figure 1-2 - The Marketing Concept MARKETING CONCEPT Customer orientation + Coordinated marketing activities Customer satisfaction Organizational success + Organization’s performance objectives +

5. Marketing involves stimulating and managing exchanges. The Marketing Exchange Model The Marketer -- The Initiator Price The Thing Offered -- Value/Benefit The Target Market -- The Receiver

6. The 3 Stages of Marketing Evolution in the United States • Product orientation focusing on manufacturing a product. • Sales orientation focusing on selling a product. • Market orientation focusing on satisfying the customer’s needs.

7. Figure 1-1 - The Evolution of Marketing PRODUCT ORIENTATION PRODUCT ORIENTATION SALES ORIENTATION PRODUCT ORIENTATION SALES ORIENTATION MARKET ORIENTATION Late 1800s Early 1930s Mid-1950s 1990s

8. Table 1-1 - How Should a Business be Defined? CompanyProduct-OrientedMarket-Oriented _______________________________________________ Kodak We make cameras andWe help preserve film.beautiful memories. Amazon.com We sell books and recordings.? Hewlett-Packard We make computer printers.? Levi Strauss We make blue jeans. ? Steelcase We make office furniture.? Caterpillar We make construction? machinery.

9. Differences between Marketing and Selling Orientations. • Marketing Orientation- Customer Focused • determining customer wants and then developing a product to satisfy that need and still yield a satisfactory profit. It is externally focused. • Selling Orientation- Self-Focused • producing a product and then trying to persuade customers to purchase it -- in effect, trying to alter consumer demand. It is internally focused.

10. Recent refinements of the marketing concept: • Quality • Quality is defined by customers. • TQM - Total Quality Management. • ROQ - Return on Quality analysis. • Relationships • An attempt to build personal, long-term bonds with customers. • Relationship marketing has expanded to include all groups an organization interact with: suppliers, employees, unions, government, and even competitors.

11. Recent refinements of the marketing concept (Con’t.): • Mass Customization • An attempt to provide affordable products customized to come as close as possible to meeting the needs of individual customers. • This is made possible because of advances in information and production technology. • Value Creation • An attempt to assess what customers value in a product. • Value means more than money to customers. • Value is a concept unique to each individual.

12. Recent refinements of the marketing concept (Con’t.): • Return on Marketing Investment • Traditionally, the cost of marketing has been treated as an expense. • Since marketing can represent at least 50% of all corporate costs, it is now being looked at as an investment. • Societal Marketing Concept • Does the Marketing Concept conflict with the best interests of society? • Involves broadly defining customer and taking a long-term view of customers satisfaction.

13. A Marketing Program Consists of: • Market Segments - groups of people sharing similar wants, buying preferences, or product-use behaviors. • Target Market - market segment to which a marketing program is targeted. • Forecasting Demand - research to determine size of the market. • Position - attempts to establish a unique identity in potential customers’ minds. • Marketing Mix - • Product/Price/Distribution/Promotion

14. Ethics and Marketing • Marketing is intended to influence the beliefs and behavior of customers and others. • The products marketed and the use of marketing tools creates a wide variety of ethical challenges. • There is disagreement over what constitutes ethical or unethical behavior. • Ethics are standards of behavior generally accepted by society. • Ethics vary from society to society.

15. Ethics and Marketing (con’t.) • Corporations are taking action to instill ethicalawareness in their employees by: • Communicating clearly ethical standards and expectations of employees. • Avoiding unreasonable pressure on employees to perform by ensuring that goals and deadlines are reasonable. • Employing an “Ethics Officer” to advise employees on ethical dilemmas. • Rewarding ethical behavior and punishing unethical behavior.

16. Marketing and the Global Economy • Nations depend upon marketing to sell their raw materials and industrial output to other countries. • Companies now compete in markets all over the world. • It is relatively easy to conduct business and sell products and services abroad. • The world is becoming more affluent, and therefore able to buy more stuff.

17. Marketing and the Global Economy(con’t.) • Marketing Creates Employment • Marketing Creates Utilities: • Place utilitymakes a product accessible to potential customers where they want it. • Time utilitymakes a product available when they want it. • Information utilityis created by informing prospective buyers that a product exists. • Image utilityis the emotional or psychological value that the customer attaches to a product or brand. • Possession utilityis created when ownership is transferred to the buyer.

18. Importance of Marketing in Organizations • The basic reason for firm’s existence is customers want satisfaction. • Marketing is the primary revenue-producing activity for firms. • Marketing has become increasingly important for service firms and nonprofit organizations.

19. Importance of Marketing in Your Life • Marketing is a large part of your daily life. Consumers are exposed to 3,000 commercial messages a day. • Studying marketing will make you a better-informed customer. • Marketing directly relates to your career aspirations. (See appendix B.)