What Is Marketing?1. Defined:

The process of developing, promoting, and distributing products to satisfy customers’ needs and wants.

Development + Promotion + Distribution = Happy Customer

1. Products – goods and services that have monetary value

2.Goods – things you can touch or hold

3.Services – you can’t physically touch – tasks performed for a customer

Functions of Marketing 1. Activities that work together to get goods and

services from producers to consumers

1) Channel Management

2) Marketing Information Management

3) Market Planning

4) Pricing

5) Product Service Management

6) Promotion

7) Selling

2.Each is essential

Channel Management1. Process of deciding how to get goods into

customers hands.

Marketing Information Management 1. Getting information to make sound business decisions -

Gathering, storing, and analyzing information, customers, trends, and competing products

2. Usually obtained through marketing research.

For example, after a stay at a luxury hotel, you fill out a form rating the service and accommodations.

Market PlanningUnderstanding concepts and strategies used to develop and target specific marketing strategies to a select audience

Pricing1. How much to charge to maximize profits

Product Service ManagementObtaining, developing,

maintaining, and improving a product or a product mix in response to market opportunities.

Promotion1. Communicating with potential customers to

inform, persuade, or remind them about a business’s products

Selling1. Planned, personalized communication that

influences purchasing decisions

The Global Economy

1. Marketers are found at every level of business.

2.Nearly all business decisions have a Marketing element.

3.Marketing changes the:

A. Number, (increased variety)

B. Quality, (better quality because of competition)

C. and Price (lower price because of competition)

of products that you can buy.

The Marketing Concept1.Businesses must satisfy customers’ needs

and wants in order to make a profit.

Click on the Model T

Ford to see Henry

Ford’s thoughts about

car color in the early

1900’s.

When Henry Ford first created the Model T, he

was the only one mass producing cars. He

didn’t have to think about “The Marketing

Concept.” But, as more and more producers

started making cars, they had to think about

what customers need and want in order to

stay in business.

Imagine if, in today’s world, you

could only buy black. Many

customers would not be very

happy!

Today’s buyer wants a choice!

The Marketing Concept1. If automobile manufactures do not give their

consumers a choice (what they want), they will not stay in business.

2.That concept is true for all businesses.

3.Companies sell what Customers want.

Economic Benefits of Marketing1. Marketing bridges the gap between you and the

maker or seller of an item

Economic Benefits of MarketingNew and Improved Products --businesses look

for opportunities to please the customer

Economic Benefits of MarketingLower Prices – marketing activities add value and

increase demand. When demand is high, manufacturers can produce at a lower price. They can sell at a lower price but increase the quantity sold. Thus, profits are higher even though prices are low.

Economic Benefits of Marketing

1.It adds VALUE

Market1. Market – all potential customers who have the

ability and willingness to buy

Target Marketing1. Focusing all Marketing efforts on a very specific

group of people who you want to reach.

1. Customers – people who buy the product

1. Consumers – people who actually use the product

Is mom the customer or the

consumer?

What about the kids?

Marketing Mix• Basic marketing strategies – the four P’s

1. Product

2. Place

3. Price

4. Promotion

Product Strategies

1. What product to make

2.How to package it

3.What brand name to use

4.What image to project

Place Strategies1. How and where a product will be distributed.

Price Strategies1. Reflect what customers are willing and able to

pay.

Promotion Strategies1. How potential customers will be told about the

new product

2.What the message will be

3.When and where it will be delivered

4.What inducements are there to purchase it

The Marketing Mix1. The elements are interconnected

Product

Place

Price

Promotion

The Marketing Mix – The 4 P’s1. Contains countless alternatives.

2.Management must select a combination of marketing mix decisions that will satisfy target markets and achieve organizational goals.

Product & Place & Price & Promotion = Goals

Analyzing Markets1.Market segmentation is a way of

analyzing a market by specific characteristics as in order to define the target market.

Types of Segmentation:1. Demographics

2. Psychographics

3. Geographics

4. Behavioral

Demographics1. Demographics – statistics that describe a

population in terms of personal characteristics. Demographics include:

2. AgeA. Baby Boom Generation

B. Generation X

C. Generation Y

3. Gender4. Marital Status

5. Ethnic Background

U.S. Trend – The percentage of the Caucasian population is declining, while other ethnic populations increase.

Psychographics 1. Involves grouping people with

similar lifestyles, as well as shared attitudes, values, and opinions.

A. Activities

B. Attitudes

C. Personality & Values

Music teachers, dancers, and

other music lovers would be one

category of people who share

psychographic characteristics.

VALS™ is a marketing and consulting tool that helps

businesses worldwide develop and execute more effective

strategies. The system identifies current and future

opportunities by segmenting the consumer marketplace on

the basis of the personality traits that drive consumer

behavior. VALS applies in all phases of the marketing

process, from new-product development and entry-stage

targeting to communications strategy and advertising.

Click on VALS to learn more

and to take a survey to

determine your VALS type

Geographics1. Geographics –

Segmentation based on where people live

A. Political Boundary

B. Climate

C. Natural Boundary

Behavioral Segmentation1. Looking at the benefits desired by consumers,

shopping patterns, and usage rate. Market benefits, not just the physical characteristics of a product

Behavioral Segmentation1. Many businesses find that the 80/20 rule applies.

2.80 % of a company’s sales are generated by 20 % of its loyal customers.

Mass Marketing Vs Segmentation1. Mass marketing not as popular as it once was.

2.Niche marketing (the current trend) – markets are narrowed down and defined with extreme precision.