Definition of Marketing

Many definitions, but all boil down to these points:

Create products based on market needs.

Informing target markets of product benefits.

Distribution of products to customers.

Businesses have evolved from:

• Production Operation--How we can produce more.

• Sales Operation--How to sell more of what we currently produce.

• Marketing--What products to produce based on customer

needs.

Market Planning Requires a lot of time.

Takes resources away from production.

Lack of staff to complete a plan.

Lack of objective evaluation tool.

Lock a company into a course of action.

Budgets for Marketing

Percentage of sales are typically 4% - 8%.

Any excess amounts not used in operations.

Best is objective approach--State: objective, purpose, activities and the specific cost for each action

What does market oriented mean?

Vs.

A company that is product oriented?

Do you agree?

Businesses are profit oriented.

What would you do?

A local hotel booked a wedding into its ballroom 9 months earlier for 300 individuals at $75/each = $22,500 + $2,500 = $25,000. Two months before the date, Texaco, a prime customer of the hotel wanted the ballroom for that day and time for 400 people at $100/each = $40,000 + $2,500 = $42,500. There was no contract signed with the wedding party. What should the hotel do?

Differences Between

Sales-Oriented Company Market-Oriented Company

Sales-Oriented

Volume - first time buyer only.

Short term.

To sell the product as it is, after it is made.

Market-Oriented

Profit oriented - repeat buyer.

Long term.

Design a product that customers want based on needs, before it is made.

Create a customer, that wants your product more than your competitors.

Keep customers - especially in the hospitality field.

What should marketing do?

Will it create and/or keep customers?

Marketing decisions should always answer “yes” to the following question:

Sale of a Membership at a Country Club