Defining Marketing for the Twenty-First Century


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Defining Marketing for the Twenty-First Century

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Defining Marketing for the Twenty-First Century

  1. 1. Chapter 1 Defining Marketing for the Twenty-First Century PowerPoint by Karen E. James Louisiana State University - Shreveport
  2. 2. Objectives <ul><li>Understand the new economy. </li></ul><ul><li>Learn the tasks of marketing. </li></ul><ul><li>Become familiar with the major concepts and tools of marketing. </li></ul><ul><li>Understand the orientations exhibited by companies. </li></ul>
  3. 3. Objectives <ul><li>Learn how companies and marketers are responding to new challenges. </li></ul>
  4. 4. The New Economy <ul><li>Consumer benefits from the digital revolution include: </li></ul><ul><ul><li>Increased buying power. </li></ul></ul><ul><ul><li>Greater variety of goods and services. </li></ul></ul><ul><ul><li>Increased information. </li></ul></ul><ul><ul><li>Enhanced shopping convenience. </li></ul></ul><ul><ul><li>Greater opportunities to compare product information with others. </li></ul></ul>
  5. 5. The New Economy <ul><li>Firm benefits from the digital revolution include: </li></ul><ul><ul><li>New promotional medium. </li></ul></ul><ul><ul><li>Access to richer research data. </li></ul></ul><ul><ul><li>Enhanced employee and customer communication. </li></ul></ul><ul><ul><li>Ability to customize promotions. </li></ul></ul>
  6. 6. Marketing Tasks <ul><li>Marketing practices may pass through three stages: </li></ul><ul><ul><li>Entrepreneurial marketing </li></ul></ul><ul><ul><li>Formulated marketing </li></ul></ul><ul><ul><li>Intrepreneurial marketing </li></ul></ul><ul><li>As marketing becomes more formulated, creativity is inhibited. </li></ul>
  7. 7. What Can Be Marketed? <ul><li>Goods </li></ul><ul><li>Services </li></ul><ul><li>Experiences </li></ul><ul><li>Events </li></ul><ul><li>Persons </li></ul><ul><li>Places </li></ul><ul><li>Properties </li></ul><ul><li>Organizations </li></ul><ul><li>Information </li></ul><ul><li>Ideas </li></ul>
  8. 8. Marketing Defined <ul><li>Kotler’s social definition: </li></ul><ul><ul><li>“ Marketing is a societal process by which individuals and groups obtain what they need and want through creating, offering, and freely exchanging products and services of value with others.” </li></ul></ul>
  9. 9. Marketing Defined <ul><li>The AMA managerial definition: </li></ul><ul><ul><li>“Marketing is the process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods, and services to create exchanges that satisfy individual and organizational objectives.” </li></ul></ul>
  10. 10. Core Marketing Concepts <ul><li>Target markets and market segmentation </li></ul><ul><li>Marketplace, market-space, metamarkets </li></ul><ul><li>Marketers & prospects </li></ul><ul><li>Needs, wants, demands </li></ul><ul><li>Product offering and brand </li></ul><ul><li>Value and satisfaction </li></ul><ul><li>Exchange and transactions </li></ul><ul><li>Relationship and networks </li></ul><ul><li>Marketing channels </li></ul><ul><li>Supply chain </li></ul><ul><li>Competition </li></ul><ul><li>Marketing environment </li></ul><ul><li>Marketing program </li></ul>
  11. 11. Core Marketing Concepts <ul><li>Target markets & segmentation </li></ul><ul><ul><li>Differences in needs, behavior, demographics or psychographics are used to identify segments. </li></ul></ul><ul><ul><li>The segment served by the firm is called the target market. </li></ul></ul><ul><ul><li>The market offering is customized to the needs of the target market. </li></ul></ul>
  12. 12. Core Marketing Concepts <ul><li>Shopping can take place in a: </li></ul><ul><ul><li>Marketplace (physical entity, Lowe’s) </li></ul></ul><ul><ul><li>Marketspace (virtual entity, Amazon) </li></ul></ul><ul><li>Metamarkets refer to complementary goods and services that are related in the minds of consumers. </li></ul><ul><li>Marketers seek responses from prospects . </li></ul>
  13. 13. Core Marketing Concepts <ul><li>Needs describe basic human requirements such as food, air, water, clothing, shelter, recreation, education, and entertainment. </li></ul><ul><li>Needs become wants when they are directed to specific objects that might satisfy the need. (Fast food) </li></ul><ul><li>Demands are wants for specific products backed by an ability to pay. </li></ul>
  14. 14. Core Marketing Concepts <ul><li>A Product is any offering that can satisfy a need or want, while a brand is a specific offering from a known source. </li></ul><ul><li>When offerings deliver value and satisfaction to the buyer, they are successful. </li></ul>
  15. 15. Enhancing Value <ul><li>Marketers can enhance the value of an offering to the customer by: </li></ul><ul><ul><li>Raising benefits. </li></ul></ul><ul><ul><li>Reducing costs. </li></ul></ul><ul><ul><li>Raising benefits while lowering costs. </li></ul></ul><ul><ul><li>Raising benefits by more than the increase in costs. </li></ul></ul><ul><ul><li>Lowering benefits by less than the reduction in costs. </li></ul></ul>
  16. 16. Core Marketing Concepts <ul><li>Exchange involves obtaining a desired product from someone by offering something in return. Five conditions must be satisfied for exchange to occur. </li></ul><ul><li>Transaction involves at least two things of value, agreed-upon conditions, a time of agreement, and a place of agreement. </li></ul>
  17. 17. Core Marketing Concepts <ul><li>Relationship marketing aims to build long-term mutually satisfying relations with key parties, which ultimately results in marketing network between the company and its supporting stakeholders. </li></ul>
  18. 18. Core Marketing Concepts <ul><li>Marketing Channels </li></ul><ul><li>Communication channels </li></ul><ul><li>Distribution channels </li></ul><ul><li>Service channels </li></ul><ul><li>Deliver messages to and receive messages from target buyers. </li></ul><ul><li>Includes traditional media, non-verbal communication, and store atmospherics. </li></ul>
  19. 19. Core Marketing Concepts <ul><li>Marketing Channels </li></ul><ul><li>Communication channels </li></ul><ul><li>Distribution channels </li></ul><ul><li>Service channels </li></ul><ul><li>Display or deliver the physical products or services to the buyer / user. </li></ul>
  20. 20. Core Marketing Concepts <ul><li>Marketing Channels </li></ul><ul><li>Communication channels </li></ul><ul><li>Distribution channels </li></ul><ul><li>Service channels </li></ul><ul><li>Carry out transactions with potential buyers by facilitating the transaction. </li></ul>
  21. 21. Core Marketing Concepts <ul><li>A supply chain stretches from raw materials to components to final products that are carried to final buyers. </li></ul><ul><li>Each company captures only a certain percentage of the total value generated by the supply chain. </li></ul>
  22. 22. Core Marketing Concepts <ul><li>Four levels of competition can be distinguished by the level of product substitutability: </li></ul><ul><ul><li>Brand competition </li></ul></ul><ul><ul><li>Industry competition </li></ul></ul><ul><ul><li>Form competition </li></ul></ul><ul><ul><li>Generic competition </li></ul></ul>
  23. 23. Core Marketing Concepts <ul><li>The following forces in the broad environment have a major impact on the task environment: </li></ul><ul><ul><li>Demographics </li></ul></ul><ul><ul><li>Economics </li></ul></ul><ul><ul><li>Natural environment </li></ul></ul><ul><ul><li>Technological environment </li></ul></ul><ul><ul><li>Political-legal environment </li></ul></ul><ul><ul><li>Social-cultural environment </li></ul></ul>
  24. 24. Core Marketing Concepts <ul><li>The marketing program is developed to achieve the company’s objectives. Marketing mix decisions include: </li></ul><ul><ul><li>Product: provides customer solution. </li></ul></ul><ul><ul><li>Price: represents the customer’s cost. </li></ul></ul><ul><ul><li>Place: customer convenience is key. </li></ul></ul><ul><ul><li>Promotion: communicates with customer. </li></ul></ul>
  25. 25. Company Orientations <ul><li>The orientation or philosophy of the firm typically guides marketing efforts. Several competing orientations exist: </li></ul><ul><ul><li>Production concept </li></ul></ul><ul><ul><li>Product concept </li></ul></ul><ul><ul><li>Selling concept </li></ul></ul><ul><ul><li>Marketing concept </li></ul></ul><ul><ul><li>Customer concept </li></ul></ul><ul><ul><li>Societal marketing concept </li></ul></ul>
  26. 26. The Marketing Concept <ul><li>Achieving organizational goals requires that company be more effective than competitors in creating, delivering, and communicating customer value. </li></ul><ul><li>Four pillars of the marketing concept: </li></ul><ul><ul><li>Target market </li></ul></ul><ul><ul><li>Customer needs </li></ul></ul><ul><ul><li>Integrated marketing </li></ul></ul><ul><ul><li>Profitability </li></ul></ul>
  27. 27. Changes in the Marketplace <ul><li>Globalization, technological advances, and deregulation have created many challenges: </li></ul><ul><ul><li>Customers </li></ul></ul><ul><ul><li>Brand manufacturers </li></ul></ul><ul><ul><li>Store-based retailers </li></ul></ul><ul><li>Both companies and marketers have been forced to respond and adjust. </li></ul>