Irwin/McGraw-Hill © The McGraw-Hill Companies, Inc., 1998
MarketingCreating Value for Customers
Gilbert A. Churchill, Jr. J. Paul PeterGilbert A. Churchill, Jr. J. Paul Peter
Gilbert A. Churchill, Jr. J. Paul PeterGilbert A. Churchill, Jr. J. Paul Peter
Chapter 1
Marketing: Creating Value for Customers
Marketing
1948 AMA
What is MarketingWhat is MarketingSlide1-1
• Marketing is the performance of business activities directed towards, and incident to, the flow of goods and services from the producer to consumer or user.
• 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 goals.
1985 AMA
Ability to Communicate Offer
Desire to Deal With Other Party
Freedom to Accept or Reject
At Least Two Parties
Slide1-2 Necessary Conditions for Exchange
The interchange of something of value between parties
Exchange Process
Importance of MarketingImportance of Marketing
Raw Materials and Production
Research andDevelopment
Packaging
Distribution
Selling Expense
Communications
Entry level salaries range between
$30,000 to $50,000
Slide1-3
Major Types of MarketingMajor Types of Marketing
TYPETYPE DESCRIPTIONDESCRIPTION EXAMPLEEXAMPLE
Product Marketing designed to create exchange for tangible products
Marketing designed to create exchanges for intangible products
Marketing designed to create favorable actions toward persons
Marketing designed to attract people to places
Marketing designed to create support for ideas or issues or to get people to change socially undesirable behaviors
Marketing designed to attract donors, members, participants or volunteers
Strategies to sell Gateway computers
Strategies by Hertz to rent cars to travelers
Strategies to get votes for Bill Clinton
Strategies to get people to vacation in Puerto Rico
Strategies to get people to stop using illicit drugs
Strategies to increase membership in the National Rifle Association
Service
Person
Place
Cause
Organization
Table1.1
Slide1-4
Levels of Marketing AnalysisLevels of Marketing Analysis
Macromarketing
• The study of marketing processes, activities, institutions, and results at a societal level.– Social responsibility– Business ethics
Micromarketing
• The study of marketing processes and activities at organizational, product, or brand levels.– Product development– Product distribution– Product pricing
Slide1-5
Marketing Management Philosophies
TYPETYPE DESCRIPTIONDESCRIPTION EXAMPLEEXAMPLE
Production Focus on efficiency of internal operations (not wants and needs)
Focus on aggressive selling techniques for overcoming customer resistance
Focus on satisfying customer needs and wants, long-term profitability, and integrating all organizational functions while achieving organizational objectives.
Focus on developing and delivering superior value to customers as a way to achieve organizational objectives.
Make the best black car you can and people will buy it
You don’t like the black car? I’ll throw in a free radio
What type of car do you want?
You will get a 5 year 100,000 mile warranty. This car is better than the one made 3 years ago.
Sales
Marketing
Value
Table1.1
Slide1-6
Stakeholders in Marketing ActivitiesStakeholders in Marketing Activities
Society at Large
OrganizationalOrganizationalActivitiesActivities
Marketing Marketing ActivitiesActivities
Competitors Suppliers Resellers
Go
vt.A
gen
cies
Em
ploy
ees
Local
CommunitiesSpecial Interest Groups
Lenders
Ow
ner
sC
usto
mer
s
Figure1.1
Slide1-7
Creating Value for CustomersFigure1.3
Slide1-8
The Consequences of Superior Customer Value
Long TermLong TermProfitableProfitableRelationshipsRelationships
CustomerCustomerLoyaltyLoyalty
CustomerCustomerSatisfactionSatisfactionand Delightand Delight
SuperiorSuperiorCustomerCustomerValueValue
Figure1.4
Slide1-9
Transactional Transactional vsvs Relationship Relationship MarketingMarketing
Transactional Marketing
• Strategy that focus on attracting new customers– individual isolated exchanges– making the sale
Relationship Marketing
• Strategy that entails forging long-term partnerships with customers – offering value– providing satisfaction
Slide1-10
Marketing Management
ImplementImplementand controland controlMarketingMarketingActivitiesActivities
Developing Developing MarketingMarketingMixMix
UnderstandingUnderstandingCustomersCustomersand Marketsand Markets
Develop Develop Marketing PlanMarketing Planand Strategiesand Strategies
Figure1-5
Slide1-11
The process of setting marketing goals for an organization and planning, implementing, and controlling strategies to meet them.
Marketing PlanMarketing Plan
• Executive Summary• Introduction• Situation Analysis• Competitive Analysis• Marketing Planning • Implementation and Control• Summary• Appendix • References
Slide1-12
Slide1-13
Target Market
TargetMarket
The portion of a market that an organization attempts to serve with its marketing mix. The group most likely to buy a firm’s product
Slide1-14
Marketing Mix
The strategic tools a firm uses to create value for customers and achieve organizational objectives. Elements created by management to satisfy mutually satisfying exchanges.
Price
PromotionPlacement
Product
Four P’s
Price
PromotionPlacement
Product
Slide1-15
Marketing Mix - Product
Something offered by marketers to customers for exchange. It may be a good, service, or an idea.
TargetMarket
Slide1-16
Marketing Mix - Price
The amount of money or other resources required to exchange for goods and services. Sometimes called rent, fee, tuition, toll, etc.
Price
PromotionPlacement
Product
TargetMarket
Slide1-17
Marketing Mix - Placement
The channels of distribution used to get products and services to market. Including wholesalers and retailers.
Price
PromotionPlacement
Product
TargetMarket
Slide1-18
Marketing Mix - Promotion
The personal and impersonal means used to inform, persuade, and remind customers about products and services. This includes advertising, sales promotion, publicity, and personal selling.
Price
PromotionPlacement
Product
TargetMarket
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