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Chapter 1:Marketing Today and Tomorrow

Marketing & Management

Mrs. Piotrowski

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WHAT IS MARKETING?SECTION 1:

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Marketing Misconception

Many people only think of advertising and selling when

they think of marketing.

Let’s prove them wrong…

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Definition of MarketingMarketing is the creation and

maintenance of satisfying exchange relationships.

Huh?

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A large consumer products company may introduce as many as 100 new products a year. On average, only

5% are successful.

Why do you think this is?

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Marketing is Everywhere

• You see marketing every day…– Advertisements– Product transports– Market researchers

• You are involved in

marketing when you…– Make a purchase– Decide whether to pay with cash or credit– Pay to have an item shipped to your house

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Understanding marketing concepts will help you…

• Make better purchasing decisions.• Develop your leadership skills.• Learn skills needed for many high-

paying careers.

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Make a list of business activities you feel are examples of marketing.

What jobs and careers could be related to these activities?

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All Businesses Use Marketing

Businesses directly involved in marketing:• Advertising

agencies• Marketing research

firms• Telemarketers

Businesses with major marketing activities:

• Retailers• Banks• Real estate

agencies• Insurance agencies• Automobile dealers

Businesses with limited marketing

roles:• Law offices• Medical

centers• Government

agencies• Public utilities

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To prepare for careers in

marketing, you need a broad

understanding of marketing functions

and activities.

There are 7 areas that have been

identified as essential skills

needed by marketers.

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Marketing Functions

Market Planning

Identifying and understanding the markets a company wants to serve and developing effective marketing

strategies for each market.

#1

EXAMPLE: Pepsi targets many different markets and diversifies their advertising to attract each market.

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Marketing Functions

Product & Service Management

Assisting in the design and development of products and services

to meet the needs of prospective customers.

#2

EXAMPLE: Apple combined the technologies of an iPod, cell phone, and Internet browser to produce the iPhone.

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Marketing Functions

Distribution

Determining the best methods and procedures to be used so prospective customers are able to locate, obtain, and use the products and services of

an organization.

#3

EXAMPLE: Car rental companies pre-arrange rental agreements so everything is ready to go when the customer arrives.

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Marketing Functions

Pricing

Establishing and communicating the value of products and services to

prospective customers.

#4

EXAMPLE: A home construction company offers customized decorating and furnishings included with a new build.

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Marketing Functions

Promotion

Communicating information to prospective customers through

advertising and other promotional methods to encourage them to purchase the organization’s products and services.

#5

EXAMPLE: Colleges mail brochures to prospective students.

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Marketing Functions

Selling

Direct, personal communications with prospective customers in order to

assess needs and satisfy those needs with appropriate products and

services.

#6

EXAMPLE: Foot Locker posts a picture of Nike’s newest sneaker on its Facebook page and asks what customers think.

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Marketing Functions

Marketing-Information Management

Obtaining, managing, and using market information to improve decision

making and the performance of marketing objectives.

#7

EXAMPLE: Use of electronic scanners at supermarket checkouts.

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Marketing Functions

Financing

Budgeting for necessary financing, and providing financial assistance to customers to assist them with

purchasing products and services.

#8

EXAMPLE: Car manufacturers have their own financing organizations to provide loans to their customers.

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Marketing Functions

Risk Management

Providing security for products, personnel, and customers and

reducing the risk associated with marketing decisions and activities.

#9

EXAMPLE: A credit card company seeking to shift their marketing message to small business owners' business needs.

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BUSINESS NEEDS MARKETING

SECTION 2:

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Make a list of products you have purchased that you later found out

were not what you expected.

Why did you make the purchase?

What did you do when you became

dissatisfied?

How do you think businesses could do

a better job of satisfying customers

in situations like yours?

SOLVE.

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Why does business need marketing?

• To help them sell their product to more customers by:– Informing customers about their

product’s existence – Informing customers where to buy their

product – Determining customers’

needs and wants

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The Functions of Business

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The Functions of Business

How can the lack of coordination among the business functions

affect a company?

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UNDERSTANDING THE MARKETING CONCEPT

SECTION 3:

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You are on the new product development team in the marketing department of a company. How will

you identify what products your customers want to own?

Once you know what the customer wants, how will you introduce the

product to them?26

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In 1908, it cost $280 to purchase one of the few available models of automobiles, the Model T Ford. It

was a luxury few people could afford. In today’s dollars, the same

car would cost about $14,000, a pretty affordable price.

Would people buy it today?

Elements of the Marketing Concept

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Operate a business profitably

Develop and market products or

services

Identify needs of

customers

The marketing concept is using the needs of customers as the primary

focus during the planning, production, pricing, distribution, and promotion of a product or service.

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Identify the Market

• The first step in implementing the marketing concept is to identify the market(s) the company wants to serve.– A market is a description of a unique

group of prospective customers a business wants to serve, along with their location.

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Develop a Marketing Mix• The second step is to develop a

marketing mix that will meet the needs of the market and that the business can provide profitably.

• The marketing mix is the blending of four marketing elements:– Product– Distribution (Place)– Price– Promotion

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Elements of the Marketing Mix

• PRODUCT – anything offered to a market by the business to satisfy needs, including physical products, services, and ideas.

• DISTRIBUTION (PLACE) – includes the location and methods used to make the product available to customers.

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Elements of the Marketing Mix

• PRICE – the amount that customers pay and the methods of increasing the value of the product to the customers.

• PROMOTION – the methods used and information communicated to encourage customers to purchase and to increase their satisfaction.

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The Marketing Mix

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THE CHANGING ROLE OF MARKETING

SECTION 4:

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Make a list of 3 non-business organizations.

How can using marketing benefit

these organizations?

Identify 1 specific way that marketing functions can be

used by each organization.

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SOLVE.

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Production Era

•Emphasis on producing and distributing new products

1900s–1920s

Sales Era

•Emphasis on using advertising and salespeople to convince customers to buy a company’s products

1930s–1940s

Marketing Department Era

•Emphasis on developing many new marketing activities to sell products

1950s–1960s

Marketing Concept Era

•Emphasis on satisfying customers’ needs with a carefully developed marketing mix

1970s–Today

Changing Approach to Marketing

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Make a list of companies or businesses you have made multiple

purchases from.

Why do you keep returning to these companies to make

purchases?

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Improving the Marketing Concept

• Relationship Marketing focuses on developing loyal customers who continue to purchase from the business for a long period of time.

• Why do this?– Customers prefer to buy from a

business they know and trust.– It costs businesses a great deal of

money to identify new customers.

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Improving the Marketing Concept

• Employee Empowerment is an approach to customer service that gives employees the authority to solve many customer problems.

• Why do this?– Businesses are represented by their

employees. If employees cannot help them, customers will quickly become dissatisfied and look for another place to shop.