Marketing 11Introduction Part 2

Overview

Key Questions (what you need to know)Explain the importance of understanding

customers and the marketplace.Identify the five core marketplace

concepts

Core Marketplace Concepts

The core marketplace concepts are1. Needs, Wants, and Demands2. Marketing Offers(goods, services,

and experiences)3. Value and Satisfaction4. Exchange, Transactions, and

Relationships5. Markets

Marketing Offers – Products, Services, and Experiences

A Marketing Offer is some combination of goods, services, information, or experiences offered to a market to satisfy a need or want.

Not just about physical products‘Marketing Myopia’ - focusing only on the

product and not the benefits/experiences

Mistake: focusing only on existing wants and ignoring customer needs.

New products come along and can provide superior service

ExperienceCompanies like Coca-Cola and Nike offer

Brand Experiences, not just products.E.G. Nike isn’t just a shoe, they promote

benefits, lifestyle

http://www.youtube.com/watch?v=ceUrljw3_EE

Value and Satisfaction

Customers seek Value and Satisfaction for products and services

Marketers must set right level of expectation

Exchange, Transactions, and Relationships

Exchange: The act of obtaining a desired object from someone by offering something in return

Transaction: A trade of values between two parties

Marketing consists of maintaining desirable exchange relationships with target markets.

Markets

Market: The set of all actual and potential buyers of a product or service. Markets are potential customers with a similar demand.

Customer-Driven Marketing

Divide markets into segmentsChoose the right segment to targetOffer a unique value propositionDifferentiate your offer from competitor

offersBuild customer value and satisfactionNurture long-term customer relationships

Q: What market, or markets, is Nike trying to capture with there ‘Leave Nothing’ advertisment?

http://www.youtube.com/watch?v=jlXRengzZoc

Core Market Place Concepts

The Production Concept

The idea the buyers will favour products that are widely available and highly affordable

Good when demand exceeds supply OR costs are high and improved productivity will bring it down (Henry Ford and the Model T)

Bad tends to lead towards Marketing Myopia

The Product Concept

The idea that buyers will favour products that offer the most in quality, performance, and innovative features

Focus is on continual product improvement

Can lead to too narrow a focusExample: Railroads thought people

wanted trains, when they really wanted cheap and convienient transportation

The Selling Concept

The idea that the market will not buy enough of the firm’s products unless it undertakes a large-scale selling effort

Usually practiced with unsought goods/services – e.g. insurance, blood donations

The Marketing Concept

Achieving organizational goals depends on knowing the needs and wants of target markets and delivering the desired satisfaction better than competitors

Customer focus and value are the paths to sales and profits

Reacting and adapting to market/customer needs

The Societal Marketing Concept

A principle of enlightened marketing that holds that marketing strategy should deliver value to the organization’s customers in a way that maintains or improves the well-being of society

Balances 3 considerations: society (human welfare), Consumers (want satisfaction), and Company (profits)

Example: Johnson & Johnson tainted Tylenol recall

8 Deaths due to product tamperingBelieved to be at the store, not factory

levelRecall cost J&J $240 Million in earningsMaintained and strengthened customer

confidence and loyalty: cost:$?

Assignment

With a partner, select an advertisment of a major company/brand on YouTube

What product is being sold?What else are they ‘selling’?How?Who/What is the market?