The document discusses the basics of marketing, including defining a market and marketing, and examines the 7 functions of marketing. It also outlines the 4 P's of the marketing mix - product, price, place, and promotion - and explains the importance of market research in understanding demographics, target markets, and market segmentation. The 7 step process of product development is also summarized.

1. Marketing Essentials
Chapter 13

2. Basics Of Marketing
MARKET: a group of customers who share common
wants and needs
• Can be individuals or a country as a whole
MARKETING: process of creating, promoting, and
presenting a product or service to meet the wants and
needs of consumers
Marketing different
products requires
different strategies!

3. Functions of Marketing (7)
1. DISTRIBUTION: the process of getting goods and services
to customers
• Purchasing, stock handling, inventory control, and physical distribution
2. FINANCING: getting the money that is necessary for setting
up and running a business
3. MARKETING INFORMATION MANAGEMENT:
gathering and analyzing information about consumers, trends, and
competitors’ products

4. Functions (Continued)
4. PRICING: Deciding how much to charge for a
product/service.
5. PRODUCT/SERVICE MANAGEMENT: obtaining, developing,
maintaining, and improving a product in response to market
opportunities.
6. PROMOTION: effort to inform, persuade, or remind
potential customers about a business’s products or services.
7. SELLING: providing customers with the goods/services
they choose to buy.

5. The Marketing Mix – the 4 P’s
MARKETING MIX- the 4 basic marketing strategies
1. PRODUCT:
a) Is there a demand for a product?
b) How can I make the product appeal to customers (packaging)?
Do you think the SNICKERS® packaging What holiday(s) do you think the
is appealing? Why or why not? demand for SNICKERS® might increase?

6. The Marketing Mix (continued)
2. PLACE:
a) How will customers buy their product?
b) Where will customers buy the product/service?
CHANNEL OF DISTRIBUTION: pathway to direct products to consumers
2 TYPES
DIRECT DISTRIBUTION: sold INDIRECT DISTRIBUTION:
from producer directly to customers one or more intermediaries
(distributors, wholesalers, or retailers)
Example: farmer to YOU! Example: farmer to HyVee to YOU!
Are SNICKERS® sold directly or indirectly?

7. Marketing Mix (Continued)
3. PRICE:
a) What are customers willing to pay?
b) Is the price competitive with other products?
c) Can the company make a profit?
BREAK-EVEN POINT: point at which…
total revenue/sales
=
the total costs/expenses of developing
and offering the product/service

8. Marketing Mix (Continued)
4. PROMOTION:
a) How will customers be aware of a product?
• Advertising, discounts/coupons, rebates, sales, give away items
Where does SNICKERS® advertise?

9. Marketing Mix (Continued)
5. 5th New Element: PEOPLE:
Good employees and customers

10. Market Research
MARKET RESEARCH: gathering and analysis of information on
the size, location, and makeup of a market.
• Market research helps businesses discover
consumers’ wants & needs!
DEMOGRAPHICS: facts about the population
• Age
• Gender What are your demographics?
• Location
• Income

11. Market Research
TARGET MARKETING: focus on the people most likely to buy
the products/services
Example: Gatorade’s target market is active youth
What is SNICKERS®’ target market?

12. Market Research
MARKET SEGMENTATION: division of a market for a product
into groups of customers who have the same needs and traits
Example: a product that generally is marketed to adult
males (let’s say men’s deodorant) might be presented
differently on the country music channel than it would be
on a sports channel

13. Product Development (7 Steps)
1. GENERATE IDEAS:
• Product development/market research
2. SCREEN IDEAS:
• Does the product fit the company?
• Does it compete with existing company products?
3. DEVELOP A BUSINESS PLAN:
• Written proposal that includes estimated sales, costs, profit
potential, market trends, and competing products

14. Product Development (continued)
4. DEVELOP THE PRODUCT:
• Prototype: model of the actual product
- tests how it can be made, if changes need to be made
5. TEST-MARKET THE PRODUCT:
• Offer in a limited market for a limited time
• Collect customer responses if they like the product
• Disadvantage: competitor can have time to develop similar product!
6. INTRODUCE THE PRODUCT:
• Publicity campaign to introduce product
• Launch of new product cost can be high

15. Product Development (continued)
7. EVALUATE CUSTOMER ACCEPTANCE:
• Track customer responses to product
• What new products are they buying?
PRODUCT FAILURES: not all products succeed!