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Copyright © 2010 Pearson Education Canada 1

Chapter 1: Contemporary Marketing

Importance of Marketing

Marketing helps lead an organization into the future by:

•Providing a means of keeping pace with change•Offering a means of connecting with

customers•Ensuring an organization offers the right

goods and services

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Marketing Defined

“An organizational function and a set of processes for creating, communicating and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders.”

2



Marketing Past and Present

Production Orientation

Socially Responsible Marketing

Orientation

SellingOrientation

Marketing Orientation

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Socially ResponsibleMarketing

Deliver satisfactionBetter than the

competition

Identify and satisfy customer

needs

Enhance society through good

corporate citizenship

4




SRM can be divided into two main areas:

1. Programs that conserve, preserve, and protect the environment

2. Programs that support causes (cause marketing)

Companies that demonstrate corporate social responsibility must make the public aware of its doings.

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The Marketing Process

Assess Customer Needs

Identify and Select a Target

Develop Marketing Strategy

Develop Customer Relationship Strategy

Evaluation and Control

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Assessing Customer Needs

An organization collects information about needs to determine if a market is worth pursuing.

1. Market Analysis

2. Consumer Analysis

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Target Identification and Selection

A target market is a group of people that have something in common. They may be in the same age range, have similar educational backgrounds, live in the same area, or share an interest or activity.

Generation YGeneration X

Baby BoomersSeniors

Canada’s population is aging; this poses a challenge for marketers currently appealing to older targets but wanting to attract younger targets.

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Developing a Marketing Strategy

Product

Price

MarketingCommunications

Distribution

MarketingMix

Consumeror

Business Customer

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Product Strategy

A product may possess tangible and intangible characteristics. Product decisions are numerous and embrace:

Quality

Features

Brand Name

Image

Size

Format

Service

Guarantees

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Product Differentiation

“A strategy that focuses marketing activity on the unique attributes or differential advantages of a brand to distinguish it from other brands.

Wal-Mart…..Save money. Live better.

Tim Hortons…..Always fresh.

Visa…..All you need.

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Price Strategy

Establishing a fair and equitable price for customers while being profitable for the organization. Price decisions consider the following factors:

Cost of manufacturing a good

Desired profit level

Location of customers

Degree of competition

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Distribution Strategy

The selection and management of marketing channels and the physical distribution of products.

Producers of Goods

Distributors of Goods

Users of Goods

A marketing channel is a series of firms that participate in the flow of goods and services from producers to final users.

13



Marketing Communications Strategy

Companies now focus on an “integrated marketing communications” strategy. The intent is to deliver a consistent message regardless of the method of communication.

Due to technology and shifting consumer behaviour, organizations now place more emphasis on digital communications. A company must follow their customers’ eyeballs wherever they may be and adjust their budget allocations accordingly.

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IMC Mix

AdvertisingDirect Response

InteractiveSales PromotionEvent MarketingPublic RelationsPersonal Selling

Consumer or Business

Customer

Coordination and integration generates more impact on the audience.

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Public Image

A good reputation is an important asset and reputation is earned through good marketing. An organization must:

Be sensitive to customer needs and interests

Support communities they operate in

Be socially responsible marketers

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Customer Relationship Management

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Marketing today is about building relationships; relationships with channel members and consumers.

CRM refers to strategies that optimize profitability, revenue, customer retention, and customer satisfaction. Successful CRM programs rely on a strong internal data management system.



Customer Retention Strategies

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Loyalty Programs

An incentive offered to customers to encourage repeat purchases.

Customer Relationship Management Programs

A system that collects and analyzes information for the purpose of devising unique marketing offers to individual customers. It encourages more purchases of same product or new purchases of complementary products.



Partnership Marketing

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Building relationships with other companies can pay dividends.

Supplier Manufacturer Distributors Consumers

In partnerships common objectives among members are established, and teamwork and cooperation replace competition and conflict.



Partnership Marketing

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Another partnership option is a strategic alliance. In a strategic alliance two firms combine their resources for the purpose of satisfying the customers they share.

Laura Secord Hallmark Cards

Mac’ Milk Subway



Evaluating Marketing Activity

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Marketing strategies must be periodically reviewed for effectiveness. A typical review may include an assessment of:

Market conditions (external influences)Competitor activity (their success or failure)Brand performance to date (are objectives being

achieved?)

Potential changes in marketing strategy are addressed in the review process.

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Business

good marketing

marketing activity

responsible marketers16

market analysis2

selectiona target market

product decisions

channel members

consumer behaviour