Chapter.1 Overview Of Marketing

OVERVIEW OF MARKETING

CHAPTER 1 (CLO 1)

Ainiezean Awang Jual - JP-PKK


OVERVIEW ..

Marketing

Creating & Capturing

Customer value

Managing profitable customer

relationships


OVERVIEW1.1 Understand Marketing

Marketing is one of the many business functions which deals with CUSTOMERS.

The simplest definition of marketing:“Marketing is managing profitable customer relationships”

The twofold goal of marketing is to attract new customers by promising superior value and to keep and grow current customers by delivering satisfaction.

Marketing is not merely about selling and advertising, but more to creating a positive & profitable relationships!In order to have that profitable relationships, we as marketers will first have to know what is demanded & needed by consumers before creating an offering which match their requirements and earn our returns! $$$


1.1.1 Define Marketing

Today marketing must be understood not in the old sense of making sale – “telling & selling” – but in the new sense of satisfying customer needs. If the marketer understands consumer needs, develops product that provide superior customer value and good prices, distributes & promotes them effectively, these products will sell easily without needing massive promotional activities!

Marketing define:The process by which companies create value for customers and build strong customers relationships in order to capture value from customers in return.


Mr. Marketer Mr. Buyer


1.1.2 The FIVE (5) steps in Marketing Process

Figure 1.1 presents a simple five-step model of the marketing process. In the first four steps, companies work to understand consumers, create customer value and build strong customer relationships. In the final step, companies reap the rewards of creating superior customer value. By creating value for consumers, they in turn capture value from consumers in the form of sales, profits and long-term customer equity.

Understand the

marketplace & customer

needs & wants

Design customer-

driven marketing strategy

Construct an integrated marketing

program that delivers superior

value

Build profitable

relationships & create customer delight

Capture value from

customers to create profits & customer

equity

Figure 1.1

Create value for customers & build customer relationships

Capture value from customers in return


Marketing starts with finding out what prospective customers think and what they need.

These needs are then fulfilled by the products and services that you sell.

The pricing, promotion, and distribution of these products and services will then determine who will be willing and able to buy them.

Customer purchase and marketers grab revenue.This process ends with an evaluation of all marketing activities

and a new outlook for the future of the business.

1.1.2 The FIVE (5) steps in Marketing Process (cont.)


1.2 Understanding the Marketplace & Customer Needs

Marketers need to understand customer needs & wants and the marketplace within which they operate.

The FIVE (5) core customer and marketplace concepts are:

i. Needs, wants & demandsii. Market offerings ( products, services & experiences)iii. Value & satisfactioniv. Exchanges & relationshipsv. Markets


i. Needs, wants & demands

NeedsHuman needs are states of felt deprivation. They include; a) Basic physical needs e.g. foods, shelters, clothing, etc.b) Social needs e.g. sense of belongingness and love, etc.c) Individual needs e.g. knowledge, self – confidence, etc.

These needs were not created by marketers, they are a basic part of human makeup.

1.2.1 The FIVE (5) core customer and marketplace concepts


Wants Wants are people’s needs that are moulded by culture and individual personality. Example:- I’m hungry, I need food, but I want rice not bread.-I need shelter, but I want an air-conditioned room.

DemandsA demand is created when buying power backs a person’s want (exist when a person is able and willing to buy). Demands are constantly changing. Many young adults would love to own a car but it remains a want if the person could not afford to have one. Only those who have the money to purchase the product would be considered as part of the demand.

1.2.1 The FIVE (5) core customer and marketplace concepts (cont.)


ii. Market offerings – products, services & experiences.

- Consumer’s needs & wants are fulfilled through market offerings.-Market offerings are some combination of

products, services, information, or experiences offered to a market to satisfy a need or want.-Market offerings are not limited to physical

products, they also include services and other entities.



Products Any tangible product that can be offered to a market for attention, acquisition, use or consumption in which might satisfy a want or a need. E.g.?

Services Any activity or benefit offered for sale that are essentially intangible and do not result in the ownership of anything.E.g. ?

Other entitiesInclude persons, places, organizations, information and ideas.



iii. Customer Value & Satisfaction

- Customers form expectations about the value & satisfaction that various market offerings will deliver & buy accordingly.

- Satisfied customers will buy again & tell other about their good experiences.

- Dissatisfied customers switch to other competitors & disparage the product to others.

- Marketers must set the right level of expectations.- If they set expectations too low, they may satisfy those who buy

but fail to attract enough buyer.- If they raise expectations too high, buyer will be disappointed.- Customer value & customer satisfaction are key building blocks for

developing & managing customer relationships.



iv. Exchanges & Relationships

Exchange

- Marketing occurs when people decide to satisfy needs & wants through exchange relationships.

- Exchange is the act of obtaining a desired object from someone by offering something in return.

- In terms of marketing, exchange occurs when a marketer seek consumer’s feedback to a market offering he introduced.

- Five conditions must exist for an exchange to occur are:

a. There are at least two partiesb. Each party has something that may be of value to the other partyc. Each party is capable of communication and delivery d. Each party is free to accept or reject the other party’s offere. Each party believes it is appropriate or desirable to deal with the other party.



Relationship - A transaction is a one-time exchange between two

parties.- However, if the parties are involved in repeated

transactions, relationship may be built up as a result of frequent transactions. - Relationship is the tie between a customer and its

product or the producer of the product. - Marketers want to build strong relationships by

consistently delivering superior customer value



v. Market

Market is a set of all actual and potential buyers of a product or service.A market contains the following customers:

a. Consumer market: Customers who buy products for their own consumption. They are the end users of the product.

b. Business market: Customer who buy products for further processing, reselling, renting and not for own personal consumption.

c. Government market: Government bodies and related agencies who buy products in order to provide services to the public.

d. Reseller market: Customers who buy goods to resell the goods to get profits.e. International market: Customers in other countries, including consumers,

producers, resellers and governments.



1.3 Understand a customer driven strategy

The Marketing Concept:

i. Production Concepto The idea that consumers will favor products that are

available & highly affordable. o Therefore, the organization should therefore focus on

improving production & distribution efficiency.

ii. Product Concepto Make & sell concept.o The idea that consumers will favor products that offer

the most quality, performance & the features.o Therefore, organization needs to continuously put

their extra effort in improving products.


The Marketing Concept (cont.)

iii. Selling Concepto The idea that consumers will not buy enough of the

firm’s products unless it undertakes a large-scale selling & promotion effort.

o Typically practiced with unsought goods – those that buyers do not normally think of buying, e.g. insurance.

iv. Marketing Concepto Customer-centered concept – finding the right product

for customers instead of finding customers for our products.

o This concept holds that achieving organizational goals depends on knowing the needs 7 wants of target markets & delivering the desired satisfactions better than competitors do.


v. Societal Marketing Concepto The idea that a company’s marketing decisions

should consider consumers’ wants, the company’s requirements, consumers’ long-run interest, and society’s long-run interests.

o E.g. Online billing;

The Marketing Concept (cont.)

Societal Marketing Concept

Society (Human Welfare)

Company(Profits)

Consumers(want satisfaction)


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Marketing Concept

Product Concept


1.4 The Changing Marketing Landscape

1. Digital Age

- Induced by recent technology boom (e.g. Internet)- The explosive growth in computer, communications, information

and other digital technologies has had a major impact on the ways companies bring value to their customers.

- The digital age has provided marketers with exciting new ways to learn about and track customers and to create products and services tailored to individual customer needs.

- Help marketers to communicate with customers in large groups or one-to-one

- Introduce new ways of marketing - online advertising, video sharing tools, cell phones and video games to Web widgets and online social networks.

- Internet is a vast public web of computer networks that connect users of all types all around the world to each other and to an amazingly large information repository.


2. Rapid Globalization

- Globalization refers to the current economic and business situation in the world where these activities are carried out across the national boundaries in large volumes.

- Many marketers are now connected globally with their customers & marketing partners.

- The Malaysian marketers have been aggressively challenge by many of the foreign multinationals.

- E.g. Local rice Vs. Thai’s, Myanmar’s rice.



3. The Call for more Ethics & Social Responsibility

- Our CSR.- Marketers are reexamining their relationship

with social values and responsibilities and with the very Earth that sustains us.

- Today’s marketers are being called upon to take greater responsibility for the social and environmental impact of their actions.



4. The Growth of Non – Profit Marketing

- Marketing also has become a major part of the strategies of many not-for-profit organizations such as colleges, hospitals, museums, zoos, symphony orchestras and even churches.

- Not-for-profits face stiff competition for support and membership.

- Sound marketing can help them to attract membership & support.

- http://themarketingspot.com/2011/07/how-to-promote-a-non-profit-event-2.html


http://themarketingspot.com/2011/07/how-to-promote-a-non-profit-event-2.html

http://themarketingspot.com/2011/07/how-to-promote-a-non-profit-event-2.html


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The end of Ch. 1

Chapter.1 Overview Of Marketing

Business

Transcript of Chapter.1 Overview Of Marketing