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What Is Marketing?
Economics of Marketing
2
Chapter Objectives
Define marketing.
Explain the marketing concept.
Define demographics.
Explain the marketing mix.
Explain economics and free enterprise.
Identify intellectual property rights.
Explain the different types of business ownership.
Explain the economic impact of sports and entertainment.
3
The Importance of Sports and
Entertainment Marketing
The sports and entertainment industries have
become two of the most profitable industries in the
United States.
4
Marketing Defined
Because of competition, an
organized marketing plan
is essential.
marketing the process
of developing, promoting,
and distributing products,
or goods and services, to
satisfy customers’ needs
and wants
5
Goods are tangible items,
such as sports equipment.
Services are intangible
products, such as theater
tickets.
Marketing and the Marketing
Concept
Marketing Core Functions
Marketing Defined
Successful organizations
follow a marketing
concept.
marketing concept idea
that organizations need to
satisfy their customers
while also trying to reach
their organizations’ goals
7
The first step in creating a
marketing concept involves
identifying the market.
market potential
customers with shared
needs who have the
desire and ability to buy a
product
Marketing Defined
Organizations spend lots of
money to learn about their
customers needs and
wants.
8
Having a clear picture
about the target market
makes developing a
marketing plan easier to
accomplish.
target market specific
group of consumers that an
organization selects as the
focus of its marketing plan
needs a lack of basic
necessities such as food,
clothing, or shelter
wants things that people
desire based on
personality, experiences, or
information about a product
Marketing Defined
The United States census
provides useful information
about the demographics
of our nation.
9
demographics statistics
that describe population
in terms of personal
characteristics
Businesses use
demographic information to
develop their marketing
plans.
The Marketing Mix
Marketers use a tool to
develop strategies called
the marketing mix.
10
marketing mix a
combination of four basic
strategies known as the
4 Ps—product, price,
place, and promotion
To be effective, all 4 Ps in a
marketing plan must focus
on the target market.
The Marketing Mix
Marketing mix strategies
involve product, price,
place, and promotion
decisions.
11
channel of distribution
path a product takes from
the producer to the
consumer
Place decisions include
determining a channel of
distribution.
P
P
P
P
The Marketing Mix—The Four Ps
12
involve the goods, services, or ideas used to
satisfy consumer needs.
Product
Decisions
involve the exchange process between the
customer and the seller.
Price
Decisions
involve making the product available to the
customer.
Place
Decisions
involve how the goods or services are
communicated to the consumer.
Promotion
Decisions
Operating an e-tail business on an electronic channel—the Web—can be costly, due to design, delivery, returns, and operating expenses. Though Many larger dot-com companies crashed in the 1990’s, small stores like Harris Cyclery of West Newton, Massachusetts, actually increase sales using a basic Web site. Today, a third of Harris’s bicycle business rides in on the Web to get hard-to-find parts and personal service. Describe an e-business’s home page to your class after viewing one through marketingseries.glencoe.com.
Buzz Power
13
The influence of buzz is so powerful that researchers monitor
consumer opinions online. Positive buzz can increase profits
for products, books, films, TV, music, and fashion, and
determine popularity of athletes and celebrities. With public
resistance to banner ads and pop-ups, a little buzz “zooms”
a long way.
For more information on sports and entertainment marketing,
go to marketingseries.glencoe.com.
“Word-of-mouth ramped up to warp
speed” is one definition of Internet buzz,
says BusinessWeek. It’s the marketing
by-product of e-mail, instant messaging,
bulletin boards, and chat rooms.
Economic Basics
The economics of
marketing sports and
entertainment have a great
impact globally as well as
locally.
14
economics the study
of the choices and
decisions that affect
making, distributing, and
using goods and services
A measure of economic
growth is the gross
domestic product (GDP).
GDP (gross domestic
product) the value of all
goods and services
produced within a country
Economic Basics
Profit allows companies to
stay in business.
15
profit the money left
after all costs and
expenses of a business
are paid
competition as a
characteristic of free
enterprise, the struggle
among companies for
customers
As with most businesses,
there is a financial risk
involved with sports and
entertainment events.
Competition is the basis of
the free enterprise system.
Property Ownership and
Intellectual Property Rights
Inherent in the free enterprise system is the right to own property and start a business.
16
Intellectual property rights
are protected by the
following:
Copyrights
copyright legal
protection of a creator’s
intellectual property or
products
Patents
Trademarks
Types of Business
Ownership
Types of business ownership include:
17
Sole proprietorship
Partnership
Corporation
Subchapter S Corporation
Locations benefit economically from sports and/or
entertainment events and marketing.
On a local level, sporting events and entertainment
venues economically impact areas in which they
operate because they draw audiences.
Hosting the Olympics has a huge economic impact
on a region before, during, and after the event.
18
Economic Impact
Explain the concept of economics.
What are three characteristics of a free
enterprise system?
What is the economic impact of sports and
entertainment events on a community?
1.
2.
3.
19
Define and give an example of the term marketing.
20
Explain the marketing
concept.
Describe the concept of
demographics.
Marketing is the
process of
developing,
promoting, and
distributing
products, or goods
and services, to
satisfy customer
needs and wants.
1. The marketing
concept states that
organizations need
to satisfy their
customers while
also trying to reach
their organization’s
goals.
2. Demographics are
statistical
characteristics that
help describe
people and target
markets.
3.
Explain the marketing
mix.
The marketing mix
is a combination of
product, price,
place, and
promotion
decisions.
4.
Checking Concepts
1.
2.
3.
4.
continued
Explain the concept of
economics.
21
Name four types of
business ownership.
Define intellectual
property rights.
Economics is the
study of the
choices and
decisions that
affect making,
distributing, and
using goods and
services.
5. The four types of
business
ownership are sole
proprietorship,
partnership, limited
partnership, and
corporation.
6. Intellectual property
rights are intangible
and are protected
by patents,
copyrights, and
trademarks.
7.
Checking Concepts
5.
6.
7.
continued
Describe how sports and
entertainment impact
national and local
economies.
22
Critical Thinking Sports and
entertainment local
events draw audiences.
That means workers are
needed for crowd
control, ticket collection,
concession sales, and
security. These
customers may also hire
local people to work for
them. Nationally, events
that increase tourism
contribute to the GDP.
8.
Checking Concepts
8.
23
End of