Outline of the components of marketing practice and the text book

Learning objectives

1 Define the term marketing2 Explain the marketing exchange

conditions and their influence on marketing

3 Explain the five competing business orientations that impact on marketing strategy

4 Describe the marketing process5 Give several reasons for studying

marketing

1Define the term marketing

Learning objective

1 What is marketing?

• Personal selling• Advertising• Making products available in stores

• Maintaining inventories

All of the above, plus much more

1 What is marketing? (cont.)

• A philosophy• An attitude • A perspective• A management orientation

plus • A set of activities, including:– products– pricing– promotion– distribution.

• ‘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 organisational goals.’

1 What is marketing? (cont.)

American Marketing Association definition

2Explain the marketing exchange

conditions

and their influence on marketing

Learning objective

2 Five conditions of a marketing exchange

• At least two parties• Something of value• Desire to deal with other party• Ability to communicate offer• Freedom to accept or reject

3Explain the five competing business

orientations that impact on marketing

strategy

Learning objective

3 Marketing orientations

• Competing marketing management philosophies– production– sales– marketing– relationship– societal.

3 Marketing orientation(cont.)

3 Production orientation

• Focus on the efficiency of internal operations better and cheaper products

• a philosophy that focuses on the internal capabilities of the organisation, rather than on the desires and needs of the marketplace.

3 Sales orientation

• Focuses on aggressive techniques for overcoming customer resistance

• The idea that people will buy more goods and services if aggressive sales techniques are used and that high sales result in high profits.

3 Market orientation requirements

• Top management leadership• Customer focus• Competitor intelligence• Inter-functional coordination• Customer relationships

3 The marketing concept

• The idea that the social and economic justification for an organisation’s existence is the satisfaction of customer wants and needs, while meeting organisational objectives.

3 The marketing concept

• Focusing on customer wants and needs can be a source of competitive advantage through:– creating customer value– maintaining customer satisfaction– building long-term relationships.

3 Relationship marketing orientation

• The name of a strategy that entails forging long-term partnerships with customers, which is based on the marketing orientation.

3 Relationship marketing’s importance

• Attracting a new customer may be ten times the cost of keeping an old customer.

3 Societal marketing orientation

• Marketing that preserves or enhances the long-term best interests of society or an individual.

• an less toxic products– more durable products– products with reusable or recyclable material.

3 Competitive advantage

• The idea that a product can solve a set of customer problems better than any competitors’ product.

3 Customer value

• The ratio of benefits to the sacrifice necessary to obtain those benefits.

3 Customer value requirements

• Offer products that perform.• Give consumers more than they expect.

• Avoid unrealistic pricing.• Give the buyer facts.• Offer organisation-wide commitment in service and after-sales support.

3 Customer satisfaction

• The feeling that a product has met or exceeded the customer’s expectations.

3 Maintaining customer satisfaction

• Meet or exceed customer expectations

• Focus on delighting customers

• Provide solutions to customer problems.

• Customer-oriented personnel• Effective training programs• Empowered employees• Teamwork

3 Building long-term relationships

3 From marketing to relationship

• Marketing ― (Simple exchanges)

• Relationship marketing― Holiday Inn building a relationship beyond selling a place to sleep

4Describe the marketing process

Learning objective

4 The marketing processOrganisation mission

Market opportunity analysis

Marketing strategy

Target marketselection

Marketing objectives

Marketing mix•product•distribution•promotion•price

Implementation

Evaluation

Environ-mentalscan

• Understand the organisation’s mission• Set marketing objectives• Gather, analyse and interpret information

• Develop a marketing strategies for markets

• Implement the marketing strategy• Design performance measures• Evaluate marketing efforts – change if needed.

4 Marketing process activities

4 Environmental scanning

• Collection and interpretation of information about forces, events and relationships in the external environment that may affect the future of the organisation or the marketing plan implementation.

• A unique blend of– product – distribution– promotion – pricing strategies.

• designed to produce mutually satisfying exchanges with a target market.

4 The marketing mix

• The starting point of the ‘four Ps’

• Includes physical unit, package, warranty, service, brand, image and value

4 Product strategies

• Product availability – where and when customers want them

• Involves all activities from raw materials to finished products

• Impact of the Internet

4 Distribution (place) strategies

• Role is to bring about exchanges with target markets

• Includes integration of personal selling, advertising, sales promotion, and public relations, direct marketing and Internet marketing

4 Promotion strategies

4 Pricing strategies

• What is given up in an exchange to acquire a good or service.

5Describe several reasonsfor studying marketing

Learning objective

5 Why study marketing?

• Plays an important role in society

• Vital to business survival, profits and growth

• Offers career opportunities

• Affects your life every day

5 Why study marketing? (cont.)

‘Marketing is too important to

be left to the marketing

department.’ David Packard, Hewlett-Packard

• Global opportunities

• Fastest route up the corporate ladder

• Important in all business sectors

• Understanding everyday life

• Professional selling

• Marketing research• Advertising• Retail buying• Distribution management

• Product management• Product development

• Wholesaling

5 Why study marketing? (cont.)

• Half of every dollar spent by consumers pays for marketing costs.

• Become a better-informed consumer.

5 Why study marketing? (cont.)

Class discussion

• Is the term marketing ethics an oxymoron?

• Ethical problems in marketing research– Alleged invasions of personal privacy – Gathering marketing information in exchange for money or free offers

• Ethical problems in product strategy– Product quality– Planned obsolescence– Brand similarity– Packaging

• Ethical problems in distribution strategy– Determining the appropriate degree of control over a channel

– Determining whether a company should distribute its products in marginally profitable outlets that have no alternative source of supply

• Ethical problems in pricing– Probably the most regulated aspect– Most unethical pricing behaviour is also illegal

• Ethical problems in promotional strategy– The source of the majority of ethical questions

– Ethically questionable personal selling• Gifts and bribes

– Questionable advertising– Promotion of questionable features (air bags)

– Questionable WWW related promotional practices