Unit 4.1 the Role of Marketing

Chapter Goals you will understand …Marketing & how it relates to other business

functionsMarketing of goods vs. marketing of servicesMarket orientation v. product orientationCommercial marketing, social marketing,

social media marketingElements that characterize a marketMarket share; Market leadershipMarketing objectives profit v. non-profitsHow marketing strategies evolveHow innovation, ethics & culture influence

marketing practices and strategies

Definitions Essential to the success of any business.Quotes – page 247Kotler (1994) “Marketing is meeting the

needs of your customer at a profit”Getting the right product to the right

customers at the right price at the right time

Marketing impacts . . .All marketing decisions are affected by other

business functions:Finance and marketing – marketing costs $$HR – good marketing can increase demand;

may result in extra staff neededOperations – production & marketing work

together

Marketing goods v. servicesGoods Services

Are tangible Are intangible

Can be returned Can’t be returned – e.g. a bad haircut

Can be stored and consumed later

Cannot be stored; need to be consumed immediately

There is ownership of product No ownership of product

Easier to compare because of similar nature of products

More difficult to compare because of different experiences

• When selling goods, businesses focus on specific features.• When marketing a service, focus on customer service

Marketing Mix for Goods

ProductPricePlacePromotion

3 additional aspects discussed laterPeople; Processes; Physical Evidence

Product- v. Market-OrientedProduct-oriented

Inward-looking; focus on making the product 1st, then trying to sell

Product-led; assumes supply creates its own demand. Produce innovative products; tempt customers to buy

Market-oriented approachOutward-looking – carrying out market

research 1st; making products that can sellMarket-led; focused on establishing consumer

demand to supply products to meet consumer needs & wants

Product v. Market OrientedProduct-oriented approach

Microsoft, Ferrari, Dyson, Apple

Market-oriented approachFord, Sony, Samsung, Nokia

Look at benefits and limitations, page 250

Commercial MarketingCreating, developing and exchanging goods

or services that customers need and wantMarket research conducted to establish

consumer demand, and businesses supply what is demanded.

Commercial marketing is value-free and doesn’t involve moral judgments

Strategies used are tailored to product being sold

Strategies include traditional or online focusAlso, mass marketing or targeted marketing

Social Marketing“Use of commercial marketing concepts &

tools .. designed to influence individuals’ behavior to improve their well-being and that of society”

Wide concept involving many stakeholdersFocus on society’s long-term interests and

welfare.Examples – public health campaigns

Anti-smoking, drug & alcohol dangers; healthy eating

Social Media MarketingA marketing approach that uses social

networking sites to market productsBenefits:

Enables a firm to get direct feedback from customers

Low-cost way to reach a large target audienceCan enhance a firm’s brand

Most businesses use it as a supplement to other marketing methods and not as a replacement

Characteristics of the MarketMarket – an arrangement where buyers & sellers

exchange goods & services – Measurements:Market Size

By volumeBy value

Market GrowthPercent change in the market size over a period of

timeMarket Share

Percent of one firm’s share of total market salesMarket Leader – has many benefits

Marketing in Non-ProfitsDifferent from marketing in a profit

organizationNPOs engage in marketing more for social

marketing reasonsIncreasingly, NPOs are using more complex

marketing strategies to achieve their aimsUse marketing to inform and influence

behavior changeMajor drawback of most NPOs – limited

financing

Marketing StrategiesEvolve as a response to changes in customer

preferencesMarketing strategies must adapt to remain

relevant

Innovation, Ethics, Cultural DifferencesSpecific companies highlightedInnovation

Apple; NokiaEthics

Exxon, BPCultural Differences

Rolls Royce, Aston martin, McDonalds, KFC