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MarketingMarketing
What you’ll learn...What you’ll learn...
What is marketing?
What is the marketing mix?
What does it involve?
What What isis marketing? marketing?
• Marketing…Marketing…– is not ADVERTISINGis not ADVERTISING– is not SELLINGis not SELLING– is not PROMOTIONis not PROMOTION
• ““The aim of marketing is to make The aim of marketing is to make selling unnecessary.” Peter selling unnecessary.” Peter Drucker (1973)Drucker (1973)
What is marketing?What is marketing?
• Businesses need to sell Businesses need to sell products if they are to products if they are to achieve their objectives.achieve their objectives.
• Marketing is about Marketing is about ensuring that businesses ensuring that businesses can sell as many products can sell as many products as possible in order to as possible in order to make profits.make profits.
What does it involve?What does it involve?
• Marketing is a very complex concept.Marketing is a very complex concept.
• It involves:It involves:– ResearchResearch– Product designProduct design– Setting pricesSetting prices– Making sure the customer knows about Making sure the customer knows about
productsproducts– Choosing how and where to sell productsChoosing how and where to sell products
Why is it needed?Why is it needed?
• Each year millions of new products Each year millions of new products are launched:are launched:
Without careful marketing
these products would fail
“Marketing is the science and art of exploring, creating and delivering value to satisfy the needs and wants of a target market maintaining loyalty at a profit.”
Professor Philip Kotler
Organization’smarketing department
Discover consumer needs
Information about needs
Potential consumers: The market
Marketing’s first task: discovering consumer Marketing’s first task: discovering consumer needsneeds
What is a Market?What is a Market?
Potential consumers make up a Potential consumers make up a market, which is:market, which is:
1.1. PeoplePeople
2.2. with the Desire andwith the Desire and
3.3. with the Ability to Buy a with the Ability to Buy a
specific product.specific product.
Organization’s marketing departmentConcepts
forproducts
Discover consumer needs
Information about needs
Potential consumers: The market
Satisfy consumer needsFind the right combination of:
• Product• Price• Promotion• Place
Goods, services, ideas
Marketing’s Second Task: Satisfying Consumer Marketing’s Second Task: Satisfying Consumer NeedsNeeds
The Target MarketThe Target Market Because the organization Because the organization
obviously can’t satisfy obviously can’t satisfy all all
consumer needs, it must consumer needs, it must
concentrate its efforts on concentrate its efforts on
certain needs of a certain needs of a specificspecific
group of potential consumersgroup of potential consumers. This is . This is the the target markettarget market -- -- one or more one or more specific groups of potential consumers specific groups of potential consumers toward which an organization directs toward which an organization directs its marketing program.its marketing program.
Inactive orex-customers
Customer DevelopmentCustomer Development
PartnersAdvocatesClientsRepeat
customersFirst-timecustomers
Suspects
Prospects
Disqualifiedprospects
The Marketing conceptThe Marketing concept
Organizations must concentrate on the customer and not the product or the company.
Organizations should revolve round the customer and not the other way around.
The purpose of a business is to create and keep a customer
Focuses on matching your product or service Focuses on matching your product or service features and benefits in a way that suits the features and benefits in a way that suits the
prospect.prospect.
sales process is any thing that you do to close the sales process is any thing that you do to close the sale and get signed agreement or contract.sale and get signed agreement or contract.
It is ant thing that engages you with the prospect It is ant thing that engages you with the prospect or customer on a personal level rather than at a or customer on a personal level rather than at a
distance.distance.
The selling conceptThe selling concept
The major role of The major role of marketing and sellingmarketing and selling
People DO NOT buy products people buy
Relationship MarketingRelationship MarketingRelationship marketing isRelationship marketing is linking the linking the
organization to its individual customers, organization to its individual customers,
employees, suppliers, and other partners employees, suppliers, and other partners
for their mutual for their mutual long-termlong-term benefits.benefits.
Mutual long-term benefitsMutual long-term benefits between the between the
organization and its customers require organization and its customers require
links to other vital stakeholders-- including links to other vital stakeholders-- including
suppliers, employees, and “partners” such suppliers, employees, and “partners” such
as wholesalers or retailers in a as wholesalers or retailers in a
manufacturer’s channel of distribution.manufacturer’s channel of distribution.
Production era
Sales era
Marketing concept era
SocietalMarketing era
18601880190019201940196019802000
Four different orientations in the history of North Four different orientations in the history of North American businessAmerican business
The Marketing MixThe Marketing Mix
• The tools available to a business to gain The tools available to a business to gain the reaction it is seeking from its target the reaction it is seeking from its target market in relation to its marketing market in relation to its marketing objectivesobjectives
• 7Ps – Price, Product, Promotion, Place, 7Ps – Price, Product, Promotion, Place, People, Process, Physical EnvironmentPeople, Process, Physical Environment
• Traditional 4Ps extended to cope with Traditional 4Ps extended to cope with today's changing environmenttoday's changing environment
ProductProduct• The firm must come up with a product The firm must come up with a product
or service that people will or service that people will want to buywant to buy..
• It must fulfil some It must fulfil some needneed
or or wantwant..
• It must be (or at least seem) It must be (or at least seem) uniqueunique..
ProductProduct• Methods used to Methods used to
improve/differentiate improve/differentiate the product and increase the product and increase sales or target sales more sales or target sales more effectively to gain effectively to gain a competitive advantage a competitive advantage e.g.e.g.– Extension strategiesExtension strategies– Specialised versionsSpecialised versions– New editionsNew editions– Improvements – real or Improvements – real or
otherwise!otherwise!– Changed packagingChanged packaging– Technology, etc.Technology, etc.
Image copyright: www.freeimages.co.uk
ProductProduct• Methods used to Methods used to
improve/differentiate improve/differentiate the product and increase the product and increase sales or target sales more sales or target sales more effectively to gain effectively to gain a competitive advantage a competitive advantage e.g.e.g.– Extension strategiesExtension strategies– Specialised versionsSpecialised versions– New editionsNew editions– Improvements – real or Improvements – real or
otherwise!otherwise!– Changed packagingChanged packaging– Technology, etc.Technology, etc.
Image copyright: www.freeimages.co.uk
Activity 1
Product or service or brand Core Product Actual Product Augmented
Product
BMW Freedom to travel A motor car
Sheraton Rooms Room service
Egypt Air Flight An airline journey
Zamalek Football ClubExcitement and
leisure T-shirts – photos
with players
ALICO Insurance policy Finance
UNIONAIR Cooling Warranty
PricePrice
• Pricing StrategyPricing Strategy
- International- International– ComparativeComparative– Cost plusCost plus
• The price must be one The price must be one that the customer thinks that the customer thinks is good is good value for moneyvalue for money..
• This is not the same as This is not the same as
being being cheap!cheap!
• Prices have a great Prices have a great psychological effect on psychological effect on customers.customers.
PricePrice
• Pricing StrategyPricing Strategy
• Importance of:Importance of:– knowing the marketknowing the market– elasticityelasticity– keeping an eye keeping an eye
on rivalson rivals
Image copyright: www.freeimages.co.uk
PromotionPromotion
• Strategies Strategies to make the to make the consumer aware consumer aware of the existence of the existence of a product of a product or serviceor service
• NOT just NOT just advertisingadvertising
PlacePlace
• The means by which products and The means by which products and services get from producer services get from producer to consumer and where they can be to consumer and where they can be accessed by the consumeraccessed by the consumer– The more places to buy the product and The more places to buy the product and
the easier it is made to buy it, the better the easier it is made to buy it, the better for the business (and the consumer?)for the business (and the consumer?)
PeoplePeople
• People represent the businessPeople represent the business– The image they present can be importantThe image they present can be important– First contact often human – what is the lasting First contact often human – what is the lasting
image they provide to the customer?image they provide to the customer?– Extent of training and knowledge Extent of training and knowledge
of the product/service concernedof the product/service concerned– Do staff represent the desired culture Do staff represent the desired culture
of the business?of the business?
PeoplePeople
• People represent the businessPeople represent the business– The image they present can be importantThe image they present can be important– First contact often human – what is the lasting First contact often human – what is the lasting
image they provide to the customer?image they provide to the customer?– Extent of training and knowledge Extent of training and knowledge
of the product/service concernedof the product/service concerned– Mission statement – how relevant?Mission statement – how relevant?– Do staff represent the desired culture Do staff represent the desired culture
of the business?of the business?
PeoplePeople
• People represent the businessPeople represent the business– The image they present can be importantThe image they present can be important– First contact often human – what is the lasting First contact often human – what is the lasting
image they provide to the customer?image they provide to the customer?– Extent of training and knowledge Extent of training and knowledge
of the product/service concernedof the product/service concerned– Mission statement – how relevant?Mission statement – how relevant?– Do staff represent the desired culture Do staff represent the desired culture
of the business?of the business?
ProcessProcess• How do people consume services?How do people consume services?• What processes do they have to go What processes do they have to go
through to acquire the services?through to acquire the services?• Where do they find the availability Where do they find the availability
of the service?of the service?– ContactContact– RemindersReminders– RegistrationRegistration– SubscriptionSubscription– Form fillingForm filling– Degree of technologyDegree of technology
Physical EnvironmentPhysical Environment
• The ambience, mood or physical presentation of the The ambience, mood or physical presentation of the environmentenvironment
• Packaging. Packaging. • Internet/web pages. Internet/web pages. • Paperwork (such as invoices, tickets,…..). Paperwork (such as invoices, tickets,…..). • Brochures. Brochures. • Furnishings. Furnishings. • Uniforms. Uniforms. • Business cards. Business cards. • The building itself (such as prestigious offices or scenic The building itself (such as prestigious offices or scenic
headquarters). headquarters). • Mailboxes and many others . . . . . . Mailboxes and many others . . . . . .
Physical EnvironmentPhysical Environment
• The ambience, mood or physical The ambience, mood or physical presentation of the environmentpresentation of the environment– Smart/shabby?Smart/shabby?– Trendy/retro/modern/old fashioned?Trendy/retro/modern/old fashioned?– Light/dark/bright/subdued?Light/dark/bright/subdued?– Romantic/chic/loud?Romantic/chic/loud?– Clean/dirty/unkempt/neat?Clean/dirty/unkempt/neat?– Music?Music?– Smell?Smell?
Stages in Consumer Stages in Consumer Decision ProcessDecision Process
Awareness
Interest
Decision
Satisfaction
Action
Advertising
Channel
Product /Service
Price
Word-of- Mouth
The Marketing MixThe Marketing Mix
• Blend of the mix depends upon:Blend of the mix depends upon:• Marketing objectivesMarketing objectives• Type of productType of product• Target marketTarget market• Market structureMarket structure• Rivals’ behaviourRivals’ behaviour• Global issues – culture/religion, etc.Global issues – culture/religion, etc.• Marketing positionMarketing position• Product portfolioProduct portfolio
– Product lifecycleProduct lifecycle– Boston MatrixBoston Matrix
MarketingMarketing ModelModelTarget Market
Aware
Understand
Believe
Want
Find
Buy
Use
Prefer
Cost
Revenue
Value
Experience
Point of Purchase
Above the Line
Loyal
Below the Line
Intention to Purchase
Behavior
Marketing Management Marketing Management PhilosophiesPhilosophiesMarketing Management Marketing Management PhilosophiesPhilosophies
CompetingCompetingPhilosophiesPhilosophiesCompetingCompeting
PhilosophiesPhilosophies
ProductionProduction
SalesSales
MarketMarket
Societal MarketingSocietal Marketing
Module 3
Marketing Management Marketing Management PhilosophiesPhilosophiesMarketing Management Marketing Management PhilosophiesPhilosophies
•
PhilosophyPhilosophy Key Ideas
ProductionProduction
SalesSales
MarketMarket
SocietalSocietal
Focus on efficiency of internal operations
Focus on satisfying customer needs and wants
Focus on satisfying customer needs and wants while enhancing individual and societal well-being
Focus on aggressive techniques for overcoming customer resistance
The Marketing ConceptThe Marketing ConceptThe Marketing ConceptThe Marketing ConceptFocus on Focus on
Customer Wants Customer Wants and Needsand Needs
Integrate Organization’s Integrate Organization’s Activities to Satisfy Activities to Satisfy Customer Needs and Customer Needs and
WantsWants
Achieve Organization’s Achieve Organization’s Long Term Goals by Long Term Goals by Satisfying Customer Satisfying Customer
Wants and NeedsWants and Needs
Comparing Sales and Market Comparing Sales and Market OrientationsOrientations
Market Orientation
Outward Coordinated use of all marketing activities
Customer satisfaction
Specific groups
of people
Satisfying wants and
needs
Organization’sFocus
Firm’sBusiness
ForWhom?
Primary Profit Goal?
Tools to Achieve
Selling goods and services
Everybody Maximum sales
volume
Primarily promotion
InwardSales Orientation
Developing Competitive Developing Competitive AdvantageAdvantage
Competitive Advantage
Customer Value
Customer Relationships
Customer Satisfaction
Value and SatisfactionValue and Satisfaction
Expectation
Performance810
If performance is lower than expectations, satisfaction is low.
If performance is higher than expectations, satisfaction is high.
Expectation
Performance
108