Chapter 1The Field of MarketingSommers BarnesNinth Canadian
Edition
Presentation by Karen A. BlotnickyMount Saint Vincent
University, Halifax, NSCopyright 2001 by McGraw-Hill Ryerson
Limited
Copyright 2001 McGraw-Hill Ryerson Limited
Chapter GoalsTo gain an understanding of:The relationship
between exchange and marketingHow marketing applies to business and
non-business situationsThe evolution of marketingServices and
relationship marketingThe factors that drive customer
satisfactionThe difference between marketing and sellingThe
marketing conceptThe impact of quality, service and ethics in
modern marketingMarketings role in the global economy, in an
individual organization, and in your life
Copyright 2001 McGraw-Hill Ryerson Limited
Definition of MarketingMarketing is the total system of business
activities designed to plan, price, promote, and distribute
want-satisfying products, services, and ideas to target markets in
order to achieve organizational objectivesMarketing means adopting
a customer focus for the organization; keeping the customers needs
in mind all the time. It may not always mean making an immediate
sale.
Copyright 2001 McGraw-Hill Ryerson Limited
In the Socioeconomic System:Marketing creates utilities:Place
utility makes a product accessible to potential customers where
they want it.Time utility makes a product available when they want
it.Information utility is created by informing prospective buyers
that a product exists.Image utility is the emotional or
psychological value that the customer attaches to a product or
brand.Possession utility is created when ownership is transferred
to the buyer.
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Importance of Marketing to OrganizationsThe basic reason for
firms existence is customers want satisfaction.Marketing is the
only revenue-producing activity for the firm.Marketing has become
increasingly important for service firms and not-for-profit
organizations.
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The Global Importance of Marketing Nations depend upon marketing
to sell their raw materials and industrial output to other
countries.Companies now compete in markets all over the world.Honda
and Toyota now build cars in Canada, starting from nothing 15 years
ago.
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The Importance of Marketing in Your LifeMarketing is a large
part of your daily life. Consumers are exposed to 3,000 commercial
messages a day.Studying marketing will make you a better-informed
customer.Marketing probably relates -- directly or indirectly -- to
your career aspirations.
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Key Words in the Marketing Definitiontotal system: not an ad hoc
approachbusiness activities: but not just for businessesplan,
price, promote, distribute: the marketing mixwant-satisfying:
meeting customers needsproducts, services, ideas: not just
productstarget markets: not a broad-brush approachorganizational
objectives: not just profits
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The Focus of Marketingmarketing involves the exchange of things
of valuemuch of marketings focus today is on the creation of value
for customerswe must develop a good understanding of customer needs
and wantsultimately, successful companies develop a close customer
relationship
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Fundamental Bases for ExchangeTwo or more people, or units, must
be involvedParties must be willing to be involved (voluntary
participation)Each party must have something of value to contribute
to the exchangeParties must communicate with each other to
facilitate the exchange process
Copyright 2001 McGraw-Hill Ryerson Limited
Evolution of Marketingmarketing has evolved from a production,
to a selling, to a marketing stagein the production-orientation
stage, emphasis was on making a better physical productin the
sales-orientation stage, the emphasis was on how to sell that
producta marketing-oriented organization places emphasis on
satisfying the wants and needs of customers
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Some industries and organizations remain at the
production-orientation stage.PRODUCTION ORIENTATIONPRODUCTION
ORIENTATIONSALES ORIENTATIONOther industries and organizations have
progressed only to the sales-orientation stage.Many industries and
organizations have progressed to the marketing-orientation
stage.PRODUCTION ORIENTATIONSALESORIENTATIONMARKETING
ORIENTATIONLate 1800sEarly 1930sMid-1950s1900s
Stages in the Evolution of Marketing
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The Marketing Conceptobjective is to produce long-term customer
satisfaction and organizational successall of the organizations
planning and operations are customer-orientedall of the marketing
activities of the organization should be consistently designed and
deliveredall activities are intended to achieve the firms
organizational objectives
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An Innovation Based on the Marketing Orientation.Relationship
MarketingAn attempt to build personal, long-term bonds with
customers.Relationship marketing has expanded to include all groups
an organization interact with: suppliers, employees, unions,
government, and even competitors.
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Drivers of Customer Satisfactiongetting the core product right
is essentialmany services and systems support the corecustomers
expect good technical performance of the product or servicethey
also expect to be treated well in face-to-face interaction with
employeesthe company must also consider how it makes the customer
feel in many subtle ways
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The Difference Between Marketing and SellingMarketing is the
process of determining customer wants and then developing a product
to satisfy that need and still yield a satisfactory profit. It is
externally focused.Selling is producing a product and then trying
to persuade customers to purchase it -- in effect, trying to alter
consumer demand. It is internally focused.
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How Should Marketing Be Defined?
CompanyProduct-OrientedMarketing-OrientedKodakWe make cameras
and film.We help preservebeautiful memories.Amazon.comWe sell books
and recordings.?Hewlett-PackardWe make computer printers.?Levi
StraussWe make blue jeans?CaterpillarWe make construction
machinery.?
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The Marketing Concept MARKETING
CONCEPTCustomerorientationOrganizationsperformanceobjectivesCoordinatedmarketingactivities+++CustomersatisfactionOrganizationalsuccess
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.A revised philosophy, called the societal marketing concept,
involves broadly defining customer and taking a long-term view of
customers satisfaction.The Societal Marketing Concept
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Quality in Marketingquality in what an organization offers is a
major contributor to value and customer satisfactionif the customer
is satisfied with the quality, he or she is likely to return to buy
againquality is very much defined by the customer; it also varies
across individuals and over timequality, as perceived by the
customer, is influenced not only by physical products but by
service as wellrequires a commitment from all staff to deliver the
highest quality possible
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Another Innovation:Mass CustomizationAn attempt to provide
affordable products customized to come as close as possible to
meeting the needs of individual customers.This is made possible
because of advances in information technology.
Copyright 2001 McGraw-Hill Ryerson Limited
Ethics in MarketingMarketing is intended to influence the
behaviour of customers and others.
The use of marketing tools can create a wide variety of ethical
challenges.There is disagreement over what constitutes ethical or
unethical behaviour.
Ethics are standards of behaviour generally accepted by
society.Ethics vary from society to society.
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More About EthicsCorporations are taking action to instill
ethical awareness in their employees by:
Avoiding unreasonable pressure on employees to
perform.Communicating clearly what is expected of
employees.Employing an Ethics Officer to advise employees on
ethical dilemmas.Rewarding only ethical performance.
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