Marketing Fundamentals

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To provide the reader or the learner with an overview of the basic principles and practices of marketing

To provide the reader or the learner with an overview of the basic principles and practices of marketing

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  • 1. Contact Email Design Copyright 1994-2013 © OxfordCambridge.OrgMarketingMarketing Fundamentals
  • 2. Contact Email Design Copyright 1994-2013 © OxfordCambridge.OrgMarketingMarketing FundamentalsKeyPoints to develop in your own time!Introductory concepts in Marketing Fundamentals@ OxfordCambridge.Org all for free and free for all.The information gathered here are under the format of KeyPoints for readers to develop in their owntime. Some tips on how to proceed, perhaps:- Identify all the KeyPoints on which you feel a need to expand your knowledge.- Choose a good book or two or info from Internet and then work towards gaining the needed knowledge.Please Enjoy!
  • 3. Contact Email Design Copyright 1994-2013 © OxfordCambridge.OrgMarketingTo provide the reader or the learner withan overview of the basic principles andpractices of marketingAim of publication
  • 4. Contact Email Design Copyright 1994-2013 © OxfordCambridge.OrgMarketingAfter developing the KeyPoints outlined in this publication, you should mainlybe able:☺ explain what marketing is☺ distinguish between micro- and macro-marketing☺ define consumer behavior☺ discuss the importance of defining personal needs☺ explain how consumers may be influenced☺ explain what marketers mean by "product“☺ discuss the importance of brand familiarity☺ explain the role of packaging in the marketing process☺ define and explain the purpose of sales prospectingLearning Objectives
  • 5. Contact Email Design Copyright 1994-2011 © OxfordCambridge.OrgMarketingMarketing Fundamentals – Summary.☺ Marketers and marketing managers perform arange of activities to deliver goods and servicesinto the hands of customers.☺ Marketing provides direction for production byhelping to make sure the right goods andservices are produced and deliver to consumers.☺ The universal functions of marketing arebuying, selling, transporting, storing,standardization and grading, financing, risktaking, and market information.☺ To understand the buying behavior ofconsumers, marketers turn to the behavioralsciences of psychology, sociology, andeconomics.☺ A product is the need-satisfying offering of afirm.☺ Marketers use packaging to help sell products,reinforce a promotional message.
  • 6. Contact Email Design Copyright 1994-2013 © OxfordCambridge.OrgMarketing☺ (Section 1) Define Marketing☺ (Section 2) Individual Consumer Behavior☺ (Section 3) Product Planning☺ (Section 4) Personal Selling ProcessMarketing Fundamentals - Sections list
  • 7. Contact Email Design Copyright 1994-2011 © OxfordCambridge.OrgMarketing(Section 1) Define Marketing – Summary☺ define what marketers do☺ explain the relationship between marketing andproduction☺ point out how marketing affects daily life☺ distinguish between micro-marketing andmacro-marketing☺ explain how planned economic systems andmarket-directed economic systems work☺ explain how marketing is related to theeconomy☺ identify the stages of economic development☺ discuss the universal functions of marketing
  • 8. Contact Email Design Copyright 1994-2011 © OxfordCambridge.OrgMarketing(Section 1) Define Marketing – HighPoints☺ What is marketing?☺ Micro- versus macro-marketing☺ Marketing and the economy☺ Stages of economic development
  • 9. Contact Email Design Copyright 1994-2011 © OxfordCambridge.OrgMarketing(Section 1) HighPoints – What is marketing?☺ Marketers and marketing managers perform arange of activities that deliver a companysgoods and services into the hands of itscustomers.☺ Marketing provides direction for production byhelping to make sure that the right goods andservices are produced and that they find theirway to consumers.☺ Marketing can affect many aspects of dailylife, including the radio and TV programs thatare broadcast, the cost of goods and services,career options, and an individuals choicesabout what goods and services to buy andwhere.
  • 10. Contact Email Design Copyright 1994-2011 © OxfordCambridge.OrgMarketing(Section 1) HighPoints – Micro- vs. Macro-marketing☺ Micro-marketing is the performance ofmarketing activities that aim to accomplish anorganizations objectives.☺ Macro-marketing is a social process thatdirects an economys flow of goods andservices from producers to consumers.
  • 11. Contact Email Design Copyright 1994-2011 © OxfordCambridge.OrgMarketing(Section 1) HighPoints – Marketing and the economy☺ An economic system organizes how an economyuses its resources to produce goods andservices and to distribute them to variouspeople and groups in society.☺ In a planned economic system, governmentagencies decide the type and quantity of goodsand services produced in the economy.☺ In a market-directed economic system, theindividual decisions of producers and consumersaffect the whole economy.☺ An economy needs an effective macro-marketing system in order to develop.☺ Less-developed economies need market-oriented intermediaries to move surplus outputto markets where there is more demand.
  • 12. Contact Email Design Copyright 1994-2011 © OxfordCambridge.OrgMarketing(Section 1) HighPoints – Stages of economic development☺ The main stages of economic development are:☺ self-supporting agriculture☺ pre-industrial☺ primary manufacturing☺ nondurable and semi-durable☺ consumer products manufacturing☺ capital equipment and consumer☺ durable products manufacturing☺ exporting manufactured products☺ The universal functions of marketing arebuying, selling, transporting, storing,standardization and grading, financing, risktaking, and market information.
  • 13. Contact Email Design Copyright 1994-2011 © OxfordCambridge.OrgMarketing(Section 2) Individual Consumer Behavior – Summary☺ define consumer behaviour☺ explain how consumers may be influenced☺ identify the consumers who make choices
  • 14. Contact Email Design Copyright 1994-2011 © OxfordCambridge.OrgMarketing(Section 2) Individual Consumer Behavior – HighPoints☺ Defining consumer behavior☺ Influencing consumers☺ Making choices
  • 15. Contact Email Design Copyright 1994-2011 © OxfordCambridge.OrgMarketing(Section 2) HighPoints – Defining consumer behaviour☺ To understand the buying behavior ofconsumers, marketers turn to the behavioralsciences of psychology, sociology, andeconomics.☺ Economic buyers are people who logicallycompare choices in terms of cost and valuereceived to get the greatest satisfaction fromspending their time and money.☺ Economic needs are concerned with making thebest use of consumers time and money.☺ An individuals buying behavior is affected bypsychological variables, such as motivation,perception, learning, attitudes, and lifestyle.☺ Needs are the basic forces that motivatepeople.☺ Wants grow from needs - they are learnedneeds.
  • 16. Contact Email Design Copyright 1994-2011 © OxfordCambridge.OrgMarketing(Section 2) HighPoints – Defining consumer behaviour☺ Wants grow from needs - they are learnedneeds.☺ A drive is a strong stimulus that encouragesaction to reduce a need.☺ Maslows hierarchy of needs shows that thereare different levels of needs from basicphysiological ones to higher level personal ones.☺ Perception is the way individuals interpret theworld; it determines how they will seek to fulfilltheir needs.☺ Marketing and promotional efforts do notaffect all consumers in the same way becauseeach person has a unique perception of theworld.☺ Learning can be defined as gaining knowledgefrom experience.☺ The learning process consists of three mainsteps: cues, response, and reinforcement.
  • 17. Contact Email Design Copyright 1994-2011 © OxfordCambridge.OrgMarketing(Section 2) HighPoints – Defining consumer behaviour☺ Consumers attitudes affect their selective andlearning processes and so affect their buyinghabits.☺ Researching and understanding consumerattitudes and beliefs can give marketers abetter picture of markets, but attitudes andbeliefs are not always good predictors ofintentions to buy.☺ Ethical issues may arise when companiesreinforce consumers inaccurate beliefs.☺ Consumer expectations often focus on the valueand benefits expected from a companysmarketing mix.☺ Lifestyle analysis is the analysis of a personsday-to-day pattern of living as expressed inthat persons activities, interests, and opinions.
  • 18. Contact Email Design Copyright 1994-2011 © OxfordCambridge.OrgMarketing(Section 2) HighPoints – Influencing consumers☺ Consumer behavior is often influenced byinterpersonal relationships in families.☺ Marketers must direct their promotionalefforts not only at the purchaser but also atthose who influence the purchaser.☺ The social class that a consumer belongs toinfluences his or her purchasing behavior.☺ Consumers are subject to a myriad ofinfluences, including others opinions, culturalforces, and the purchase situation.
  • 19. Contact Email Design Copyright 1994-2011 © OxfordCambridge.OrgMarketing(Section 2) HighPoints – Making choices☺ Consumers tend to use a problem-solvingprocess when making a purchase.☺ This process involves the following steps:becoming aware of the problem, gatheringinformation about possible solutions, evaluatingpossible solutions, deciding on the appropriatesolution, and evaluating the decision.☺ Consumers use three levels of problem solving:extensive problem solving, limited problemsolving, and routinized response behavior.☺ When consumers are faced with a completelynew idea, they accept or reject it by using theadoption process.
  • 20. Contact Email Design Copyright 1994-2011 © OxfordCambridge.OrgMarketing(Section 2) HighPoints – Making choices☺ The adoption process is similar to the problem-solving process and includes the following mainsteps: awareness, interest, evaluation, trial,decision, and confirmation.☺ When analyzing consumer behavior ininternational markets, marketers sometimesfail to understand the cultural variables at playand hold inappropriate stereotypes.
  • 21. Contact Email Design Copyright 1994-2011 © OxfordCambridge.OrgMarketing(Section 3) Product Planning – Summary☺ define product planning☺ describe product life cycles☺ explain product development☺ explain what marketing channels are
  • 22. Contact Email Design Copyright 1994-2011 © OxfordCambridge.OrgMarketing(Section 3) Product Planning – HighPoints☺ Definition of a product☺ Business products☺ Branding and brand familiarity☺ Packaging
  • 23. Contact Email Design Copyright 1994-2011 © OxfordCambridge.OrgMarketing(Section 3) HighPoints – Definition of a product☺ A product is the need-satisfying offering of afirm.☺ From a marketing viewpoint, quality is aproducts ability to satisfy customer needs.☺ A companys product may be a tangible good, anintangible service, or a mixture of both.☺ Goods are usually produced and stored beforethey are sold.☺ Services are usually sold before they areproduced and cannot be stored or transported,making it difficult to balance supply anddemand and apply economies of scale.
  • 24. Contact Email Design Copyright 1994-2011 © OxfordCambridge.OrgMarketing(Section 3) HighPoints – Definition of a product☺ A product assortment is all the products andproduct lines sold by a firm, whereas a productline is a set of closely related individualproducts.☺ Consumer products are meant for a finalconsumer; business products are used in theprocess of making other products.☺ There are four main groups of consumerproducts: convenience, shopping, specialty, andunsought.
  • 25. Contact Email Design Copyright 1994-2011 © OxfordCambridge.OrgMarketing(Section 3) HighPoints – Business products☺ The demand for business products is classifiedas derived demand because it is derived fromthe demand for final consumer products.☺ An expense item is a business product, thetotal cost of which is treated as a businessexpense the year its purchased.☺ A capital item is a long-lasting business productthat can be used and depreciated for manyyears.☺ Six different product classes are installations;accessory equipment; raw materials; componentparts and materials; maintenance, repair, andoperating (MRO) supplies; and professionalservices.
  • 26. Contact Email Design Copyright 1994-2011 © OxfordCambridge.OrgMarketing(Section 3) HighPoints – Branding and brand familiarity☺ Branding is the use of a name, term, symbol, ordesign to identify a product.☺ Conditions that help a brand to becomesuccessful include the following: the product iseasy to identify by brand or trademark;product quality can be maintained easily;product quality is the best value for the price;dependable and widespread availability ispossible; demand is strong; economies of scaleexist; and favorable shelf space or displayspace in stores is available.☺ Brand familiarity is the level at whichconsumers recognize and accept a brand.☺ Five levels of brand familiarity are useful forstrategy planning: rejection, nonrecognition,recognition, preference, and insistence.☺ A family brand is the same brand name forseveral products.
  • 27. Contact Email Design Copyright 1994-2011 © OxfordCambridge.OrgMarketing(Section 3) HighPoints – Branding and brand familiarity☺ Licensed brands are well-known family brandsthat producers pay a fee to use.☺ Individual brands are used when a companyproduces several different products withseparate brand names.☺ Generic products have no brand at all, otherthan the identification of their contents andthe manufacturer.☺ Manufacturer brands are created by producersand distributed nationally or globally.☺ Dealer brands are brands created bymiddlemen.☺ Manufacturer brands and dealer brands arecurrently competing in a "battle of the brands"to determine which brands are more popular.
  • 28. Contact Email Design Copyright 1994-2011 © OxfordCambridge.OrgMarketing(Section 3) HighPoints – Packaging☺ Packaging entails promoting and protecting aproduct.☺ Marketers use packaging to help sell products,reinforce a promotional message, and reducelosses due to damage, spoilage, or theft.☺ In some countries, a label must give accurateinformation about product contents and allowvalue comparisons between products.☺ A warranty is what the seller promises theconsumer about a product.☺ If a company chooses to offer a warranty, itmust be clearly written and available forinspection before purchase.☺ The stronger a warranty is, the more attractiveit is to the consumer.
  • 29. Contact Email Design Copyright 1994-2011 © OxfordCambridge.OrgMarketing(Section 4) Personal Selling Process – Summary.☺ explain the purpose of sales prospecting☺ describe a typical sales presentation☺ explain the importance of defining personalneeds
  • 30. Contact Email Design Copyright 1994-2011 © OxfordCambridge.OrgMarketing(Section 4) Personal Selling Process – HighPoints.☺ Sales prospecting☺ A sales presentation☺ Identifying customers’ needs☺ Making a sale
  • 31. Contact Email Design Copyright 1994-2011 © OxfordCambridge.OrgMarketing(Section 4) HighPoints – Sales prospecting☺ A prospect is a person or organization that hasthe potential to purchase a companys productsor services.☺ Prospects are not the same as leads, which arepeople or organizations a salesperson suspectsmight be prospects.☺ Qualified prospects should have the money tobuy, the ability to buy, and the desire to buy.☺ In the cold canvas prospecting method, repsapproach leads they dont know. With theendless chain referral method of prospecting,salespeople use existing customers as sourcesof information about prospects.☺ A referral is a person or organizationrecommended to a salesperson.☺ Orphaned customers - people or organizationspreviously handled by a salesperson who hasnow changed jobs - are a rich source ofprospects.
  • 32. Contact Email Design Copyright 1994-2011 © OxfordCambridge.OrgMarketing(Section 4) HighPoints – Sales prospecting☺ Salespeople can expand their range ofprospects by participating in sales lead clubsand trade shows.☺ Other ways of gathering prospects include thecenter of influence method, the observationmethod, networking, direct-mail prospecting,and telemarketing.☺ Salespeople should follow three guidelines toenhance their prospecting methods: customizethe method to suit the particular needs of thefirm; focus on high potential customers to startwith, leaving prospects with lower potentialuntil later; and always return to prospects whodidnt buy.☺ To ensure a steady flow of potential customers,salespeople try to maintain a prospect pool - alist of names collected from four main sources:leads, referrals, orphans, and customers.
  • 33. Contact Email Design Copyright 1994-2011 © OxfordCambridge.OrgMarketing(Section 4) HighPoints – A sales presentation☺ The type of sales presentation given by a rep isdetermined by the sales call objective, thefirms customer relations policy, and the repsknowledge of the prospect.☺ The choice of sales presentation affects howmuch of the interaction will be directed by therep.☺ With structured techniques - such as preparedpresentations - the salesperson directs theconversation; customers participation islimited to direct responses to plannedquestions, which include the reps request foran order.
  • 34. Contact Email Design Copyright 1994-2011 © OxfordCambridge.OrgMarketing(Section 4) HighPoints – A sales presentation☺ Prepared presentations (also known asmemorized or canned presentations) are notsuited to complicated situations because thesame presentation is used for all customers.☺ The selling formula method tries to combinethe structure of a planned presentation withthe flexibility of a customized presentation.☺ It usually begins with a planned segment butends with the customers clarifying theirrequirements.
  • 35. Contact Email Design Copyright 1994-2011 © OxfordCambridge.OrgMarketing(Section 4) HighPoints – Identifying customers’ needs☺ The consultative selling method aims to identifythe customers needs at the beginning of thepresentation.☺ The consultative aspect is giving the customerequal or more participation time in the salespresentation.☺ The consultative selling approach can be brokendown into three phases: need development,need awareness, and need fulfilment.☺ Salespeople use a combination of open questionsand closed questions to discover a prospectsneeds.☺ Closed questions are designed to elicit brief yesor no responses. Open questions are intended toencourage more expansive responses from theprospect.
  • 36. Contact Email Design Copyright 1994-2011 © OxfordCambridge.OrgMarketing(Section 4) HighPoints – Identifying customers’ needs☺ The multiple question approach (SPIN) outlinesthe sequence of the four questions types a repasks in a presentation: situation, problem,implication, and need-payoff.☺ During a presentation, a salesperson mustcontinually assess the customers reactions.☺ In addition to verbal responses, nonverbalcommunication through body and facialgestures can signal positive or negativereactions to the salespersons approach.
  • 37. Contact Email Design Copyright 1994-2011 © OxfordCambridge.OrgMarketingMarketing Fundamentals – Conclusion☺ At this point you should be able to be familiarwith the following:• define what marketers do• explain the relationship between marketingand production• distinguish between micro-marketing andmacro-marketing• explain how marketing is related to theeconomy• discuss the universal functions ofmarketing• define consumer behavior• explain how consumers may be influenced• define product planning• describe product life cycles• say what marketing channels are• explain the purpose of sales prospecting
  • 38. Contact Email Design Copyright 1994-2013 © OxfordCambridge.OrgMarketing
  • 39. Contact Email Design Copyright 1994-2013 © OxfordCambridge.OrgMarketingInformation Gathering Links