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© 2013 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner.
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CHAPTER
Overview of
Marketing
1
Copyright © 2014 by the McGraw-Hill Companies, Inc. All rights reserved.McGraw-Hill/Irwin
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L E A R N I N G O B J E C T I V E SL E A R N I N G O B J E C T I V E S
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Define the role of marketing in
organizations.
Describe how marketers create value for
a product or service.
Understand why marketing is important
both within and outside the firm.
Overview of Marketing
LO1
LO2
LO3
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© 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner.
This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
What is Marketing?
Marketing is an organizational function and
a set of processes for creating, capturing,
communicating, and delivering value to
customers and for managing customer
relationships in ways that benefit the
organization and its stakeholders.
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© 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner.
This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
Marketing is about Satisfying Customer
Needs and Wants
What group is Pepsi targeting with this ad?
What other benefits of soft drinks might Pepsi advertise?
What groups might these benefits appeal to?
PRNewsFoto/PepsiCo; AP Photo.
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This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
Marketing Entails an Exchange
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Marketing Requires Product,
Price, Place, and Promotion Decisions
Product
Creating value
PRNewsFoto/PepsiCo;
AP Photo.
Price
Capturing value
©Digital Vision Ltd.
Place
Delivering value
©BrandX/JupiterImages/Getty Images.
Promotion
Communication
value
©Stockbyte/PunchStock.
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© 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner.
This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
Product: Creating Value
The fundamental
purpose of Marketing
is to create value by
developing a variety
of offerings, including
goods, services, and
ideas, to satisfy
customer needs.
Goods
Services
Ideas
Royalty-Free/Corbis
Roz Wodward/Getty Images
Flying Colours Ltd./Getty Images
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This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
Price: Capturing Value
Price is everything a buyer
gives up (money, time,
energy) in exchange for
the product.
How much are customers
willing to pay and can a
profit can be made at that
point.
AP Photo/The Canadian Press, Jacques Boissinot.
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This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
Place: Delivering the Value Proposition
Place, or supply chain
management, describes
all activities necessary to
get the product to the
right customer when the
customer wants it.
Where would you find
this product in the store?
Courtesy Horizon Organic Dairy
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This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
Promotion: Communicating Value
Promotion is
communication by a
marketer that
informs, persuades,
and reminds
potential buyers about
a product or service
to influence their
opinions or elicit a
response. Photo by Paul Hawthorne/Getty Images
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This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
Marketing Can be Performed
by Individuals and Organizations
ETSY Website
C2C
Consumer B
B2C
Consumer A
B2B
Retailer
(Sells PCs &
monitors)
Manufacturer
(Makes monitors)
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This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
Marketing Impacts Various Stakeholders
Society Customers
Employees Supply
Chain
Courtesy National Fluid Milk Processor Promotion Board;
Agency: Lowe Worldwide, Inc.
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This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
Marketing Helps Create Value
1. H.Armstrong Roberts/Retrofile/Getty Images
2. Jamie Grill/Iconica/Getty Images
3. ©Ted Dayton Photography/Beateworks/Corbis
4. Ciaran Griffin/Stockbyte/Getty Images
5. ©Colin Anderson/Blend Images/Corbis
Production
1.
Sales
2.
Marketing
3.
Value based marketing
4.
5.
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This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
Value-Based Marketing
“Pure Dark Chocolate
Light Exquisite Cookie”
Courtesy Pepperidge Farm.
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This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
CHECK YOURSELF
1. What is the definition of marketing?
2. Marketing is about satisfying ______ and
______.
3. What are the four components of the
marketing mix?
4. Who can perform marketing?
5. What are the various eras of marketing?
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This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
How Do Firms Become
Value Driven?
Sharing Information
Balancing Benefits with Costs
Building Relationships with Customers
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This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
CHECK YOURSELF
1. Does providing a good value mean selling at
a low price?
2. What are the benefits of long-term
relationships with customers?
3. How are marketers connecting with
customers using social and mobile media?
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This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
Why Is Marketing Important?
DigitalVision/GettyImages
JasonReed/GettyImages
©EdwardRozzo/Corbis
AndrewWard/LifeFile/Getty
Images
©RoyMcMahon/Corbis
BananaStock/JupiterImages
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This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
Check Yourself
1. List five factors that emphasize the
importance of marketing.
2. A firm doing the right thing emphasizes the
importance of marketing to _________.
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Exchange is the trade of things of value between
the buyer and the seller so that each is better off
as a result.
Glossary
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Goods are items that you can physically touch.
Glossary
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Services are intangible customer benefits that
are produced by people or machines and
cannot be separated from the producer.
Glossary
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This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
Ideas include thoughts, opinions, and
philosophies, and intellectual concepts which
can be marketed.
Glossary
24. 1-24
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A supply chain is the group of firms that make
and deliver a given set of goods and services.
Glossary
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Value reflects the relationship of benefits to costs.
Glossary
Editor's Notes These questions are the learning objectives guiding the chapter and will be explored in more detail in the following slides. The ad is targeted to those who find taste to be an important element. Other benefits might include calorie-conscious or carbonated beverages. This is an overview of the 4P’s which will be discussed in greater depth. A good example of how price expresses value is the variations in price associated with air travel. The prices can vary based on demand. Market pricing versus cost pricing. Place delivers the product to the customers. Students may overlook the importance of this component of the marketing mix because it is not as readily visible from the consumer perspective. Calvin Klein’s provocative advertising has helped create an image that is filled with youth, style, and sex appeal. This exhibit illustrates how the same product, a desktop computer, can be sold from firm to firm, from firm to consumer, and then be used consumer to consumer to sell C2C. Marketers affect many stakeholders. Customers represent one stakeholder group but others include all those in the supply chain, employees, and society at large. Supply chain partners include manufacturers, agents, wholesalers, retailers, and so on. Companies market to employees with employment marketing, also known as internal marketing, to recruit and retain the best employees. Marketing has been through several eras. This exhibit graphically represents the changes over time from an emphasis on production to one based on value-based marketing. The production-oriented era took place around the turn of the 20th century, when most firms believed a good product would sell itself. In the sales-oriented era, production and distribution techniques improved and supply outpaced demand. Firms found an answer to overproduction by focusing on sales. In the market-oriented era, the focus was on what customers wanted. Now, we are in the value-based era, which maintains the market orientation but also includes a focus on giving greater value than the competition. Value reflects the relationship of benefits to costs. Value-based marketing means implementing a marketing strategy according to what customers value. Firms become value driven by focusing on four activities.