““EverythingEverything a business a business does to help get a does to help get a productproduct from thefrom the producerproducer to theto the

consumer”consumer”

Buyer:Buyer:Any place where goods and services are Any place where goods and services are bought and soldbought and sold

Seller:Seller:A group of people that have:

-a want or need for a product-a want or need for a product-a willingness to buy-a willingness to buy-financial ability-financial ability

States that the States that the

customerscustomers make the make the

decisions about what decisions about what

products are sold on products are sold on

the marketthe market

Why is does Marketing Why is does Marketing Matter?Matter?

• New and improved products New and improved products generate competitiongenerate competition

• Lower prices – overheadLower prices – overhead

• Added value and utility – satisfy Added value and utility – satisfy needs/wantsneeds/wants

ALL PRODUCTS HAVE ALL PRODUCTS HAVE A LIFE LIKE US!A LIFE LIKE US!

THEREFORE,THEREFORE,ALL PRODUCTS WILL ALL PRODUCTS WILL BE BE BORNBORN & WILL & WILL DIEDIE

PRODUCT LIFE CYCLEPRODUCT LIFE CYCLE

• A particular firm's marketing mix usually A particular firm's marketing mix usually must change during the PLC.  Customers' must change during the PLC.  Customers' attitudes and needsattitudes and needs may may changechange over the over the PLC.  The product may be aimed at entirely PLC.  The product may be aimed at entirely different targets at different stages.   different targets at different stages.  

• EXAMPLE: an automobile is a product that EXAMPLE: an automobile is a product that provides personal transportation, but our provides personal transportation, but our choice of vehicle changes as our needs and choice of vehicle changes as our needs and situations change.  situations change.  

Product Life CycleProduct Life Cycle

 FACT! Most companies experience

losses during introduction because they spend a lot of money for promotion, product, and place

development. 

INTRODUCTION STAGE

This is the time to promote your product so people begin to learn about your product.

GROWTH STAGEGROWTH STAGE

• This is the stage where industry This is the stage where industry profits are largest, but it is also when profits are largest, but it is also when industry profits begin to decline as industry profits begin to decline as increased competition creates increased competition creates downward pressure on pricesdownward pressure on prices..

MATURITY STAGEMATURITY STAGE

• Market MaturityMarket Maturity occurs when industry occurs when industry sales sales level offlevel off.  Competition gets tougher .  Competition gets tougher as aggressive competitors have entered as aggressive competitors have entered the race for profits.the race for profits.

• EX.) In the United States, the markets for EX.) In the United States, the markets for most cars, boats, television sets, and most most cars, boats, television sets, and most household appliances are in market household appliances are in market maturity.  This stage may continue for maturity.  This stage may continue for many years -- until a new product idea many years -- until a new product idea comes along that makes the old product comes along that makes the old product concept obsolete -- even though individual concept obsolete -- even though individual brands or models come and go. brands or models come and go.

DECLINE STAGEDECLINE STAGE

• During the During the Sales DeclineSales Decline stage, stage, new products replace the old.new products replace the old.  Price   Price competition from dying products competition from dying products becomes more vigorous, but firms becomes more vigorous, but firms with strong brands may make profits with strong brands may make profits until the end because they until the end because they successfully differentiated their successfully differentiated their productsproducts. .

• Channel MgtChannel Mgt

• Market PlanningMarket Planning

• Marketing Marketing Information MgtInformation Mgt

• PricingPricing

• Product/Service Product/Service MgtMgt

• PromotionPromotion

• SellingSelling

Profit MakingProfit MakingT-Shirt @ School StoreT-Shirt @ School Store

• Cost to Manufacturer ------------------------ $1.50Cost to Manufacturer ------------------------ $1.50

• Sells to T-Shirt Wholesaler ----------------- $2.50Sells to T-Shirt Wholesaler ----------------- $2.50

• Sells to Screen Print Wholesaler ---------- $4.00Sells to Screen Print Wholesaler ---------- $4.00

• Sells to T Shirt Retailer ------ -------------- $7.50Sells to T Shirt Retailer ------ -------------- $7.50

• Sells to YOU -------------------------------- $15.00Sells to YOU -------------------------------- $15.00

Profit MakingProfit MakingT-Shirt @ School StoreT-Shirt @ School Store

• Cost to Manufacturer ------------------------ $1.50Cost to Manufacturer ------------------------ $1.50

• Sells to T-Shirt Wholesaler ----------------- $2.50Sells to T-Shirt Wholesaler ----------------- $2.50

• Sells to Screen Print Wholesaler ---------- $4.00Sells to Screen Print Wholesaler ---------- $4.00

• Sells to T Shirt Retailer ------ -------------- $7.50Sells to T Shirt Retailer ------ -------------- $7.50

• Sells to YOU -------------------------------- $15.00Sells to YOU -------------------------------- $15.00

•Pushing:Pushing:– happens when a happens when a

product is on the product is on the market because market because a a business feels it will business feels it will sellsell -- therefore they -- therefore they introduce itintroduce it

•Vending Vending machines @ machines @ LSHSLSHS

•Pulling:Pulling:– happens when a happens when a

product is on the product is on the market because market because consumers feel they consumers feel they want itwant it -- therefore a -- therefore a company will introduce company will introduce itit

•Restaurants in Restaurants in LakevilleLakeville

•Form UtilityForm Utility• Ex. JacketsEx. Jackets

•Time UtilityTime Utility• Ex. 24 Hr GroceryEx. 24 Hr Grocery

•Place UtilityPlace Utility• Ex. Store, Internet ect..Ex. Store, Internet ect..

•Possession Possession UtilityUtility

• Every time legal ownership takes Every time legal ownership takes placeplace

The Utility QuizThe Utility Quiz• swimming suits in July

• Paper sold at school store

• 24 hour delivery service

• instant credit service

• skis for a winter carnival

• stores in a suburban location

• stores open at night

• cotton made into a shirt

• vending machines in an airport lounge

• Starbucks open at 6:00am

What is a MARKET?What is a MARKET?

All people All people

who share similar who share similar needsneeds and and wants wants and who have the and who have the

ABILITYABILITY

to purchase a given productto purchase a given product

Consumer MarketConsists of consumers who purchase goods and services for their personal use.

Industrial Market ( B2B) this market includes all businesses that buy products for use in their operations.

* Most relate to improving profits

Two Types of Markets…

A group of people who are identifiedfor a specific marketing plan

Market SegmentationMarket Segmentation

• The process of classifying people who form a given market into even smaller groups

MARKET SEGMENTATIONMARKET SEGMENTATION

• 3 WAYS…3 WAYS…– Demographics Demographics ((age, income, gender, marital age, income, gender, marital

status, ethnic background)status, ethnic background)

– Geographics Geographics (local, regional, national, or global)(local, regional, national, or global)

– Psychographics Psychographics (similar lifestyles- shared (similar lifestyles- shared attitudes, values, and opinions)attitudes, values, and opinions)

– BehavioralBehavioral (shopping patterns & usage rate) (shopping patterns & usage rate)

the amount of sales the amount of sales thatthat

a company controlsa company controlswithin it’s industrywithin it’s industry

Market ShareMarket Share

•1 million hamburgers are 1 million hamburgers are wanted in Lakeville every wanted in Lakeville every year…year…

• McDonalds McDonalds 300,000300,000

• Burger KingBurger King 250,000250,000

• Wendy’s Wendy’s 150,000150,000

• Green MillGreen Mill 100,000100,000

• Applebee'sApplebee's 200,000200,000

Market shareMarket share

•1 million hamburgers are 1 million hamburgers are wanted in Lakeville every wanted in Lakeville every year…year…

• McDonalds McDonalds 300,000300,000

• Burger KingBurger King 250,000250,000

• Wendy’s Wendy’s 150,000150,000

• Green MillGreen Mill 100,000100,000

• Applebee'sApplebee's 200,000200,000

•1 million hamburgers are 1 million hamburgers are wanted in Lakeville every wanted in Lakeville every year…year…

• McDonalds McDonalds 300,000300,000

• Burger KingBurger King 250,000250,000

• Wendy’s Wendy’s 150,000150,000

• Green MillGreen Mill 100,000100,000

• Applebee'sApplebee's 200,000200,000

Your Turn…Your Turn…

• Select a product that you have recently Select a product that you have recently purchased or a product that interests you.purchased or a product that interests you.

• Describe the 4 P’s used for the product.Describe the 4 P’s used for the product.

• List all the examples you can think of…List all the examples you can think of…

• Do you think they were good mktg ideas?Do you think they were good mktg ideas?

• Why or why not?Why or why not?

The Marketing PlanThe Marketing Plan

SWOTSWOT Analysis Analysis

•SStrengthstrengths

•WWeaknesseseaknesses

•OOpportunitiespportunities

•TThreatshreats

Internal Internal Strengths/WeaknessesStrengths/Weaknesses

– Company analysisStaff-related ?’sFinancial ?’sProduction Capability ?’sMarketing Mix (4 P’s) ?’s

– Customer Analysis– Competitive Position

External External Opportunities/ThreatsOpportunities/Threats• CompetitionCompetition

• Environmental Scan “PEST”Environmental Scan “PEST”

•PPolitical olitical (ex. Regulations on telemarketing, music (ex. Regulations on telemarketing, music downloading)downloading)

•EEconomic conomic (ex. Recession, unemployment)(ex. Recession, unemployment)

•SSocio-cultural ocio-cultural (ex. Increasing diversity, obesity)(ex. Increasing diversity, obesity)

•TTechnological echnological (ex. Computer automation, (ex. Computer automation, satellite technology)satellite technology)

Your Turn…Your Turn…

• Assignment: Prepare a SWOT Assignment: Prepare a SWOT Analysis Analysis

• Select a company that interests youSelect a company that interests you

• Prepare a SWOT analysisPrepare a SWOT analysis

• Then, prepare a chart that depicts Then, prepare a chart that depicts the company’s internal S’s & W’s, the company’s internal S’s & W’s, and external O’s & T’sand external O’s & T’s