Outline for presentation zIntroduction of course and background zIntroduction of marketing e-book zHow will the course be conducted? zWhat is marketing? zWhat are different ways in which firms can be oriented to doing business? zWhat is the marketing concept? zWhat are some critical marketing tools ythe marketing mix ymarketing strategy ymarket segmentation

MK – Spring 2002 Dr. Lex Higgins Overview of class August 2002

Outline for presentation zIntroduction of course and background zIntroduction of marketing e-book zHow will the course be conducted? zWhat is marketing? zWhat are different ways in which firms can be oriented to doing business? zWhat is the marketing concept? zWhat are some critical marketing tools ythe marketing mix ymarketing strategy ymarket segmentation

Introduction of course and background zPrinciples of marketing is a required course for business majors and others zThe purpose of the course is to familiarize you with core concepts (principles) that define what marketing is and how it is done

Exercise - What is marketing, really? How do you think Marketing is defined in most companies? Form a definition based on your perception and write your definition down.

What is marketing, really? How is it defined in business and academics?

Definitions of marketing zAmerican Marketing Association: the performance of business activities directed toward, and incident to, the flow of goods and services from producer to consumer or user. (1948) zAmerican Marketing Association: the process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods, and services to create exchanges that satisfy individual and organizational objectives. (1985)

Definitions of marketing (continued) Marketing is the process of establishing and maintaining mutually beneficial exchange relationships with customers and other stakeholders (Nickels and Wood, 1997) Marketing is a social and managerial process by which individuals and groups obtain what they need and want through creating, offering, and exchanging products of value with others (Kotler 1997) Marketing is the conceptualization and profitable delivery of customer satisfaction (Higgins 1992)

A quote from Peter Drucker on marketing There will always, one can assume, be need for some selling. But the aim of marketing is to make selling superfluous. The aim of marketing is to know and understand the customer so well that the product or service fits him (or her) and sells itself. Ideally, marketing should result in a customer who is ready to buy. All that should be needed then is to make the product or service available.

Three different orientations to managing marketing activities zProduction orientation zSales or Promotion Orientation zMarketing Orientation

Marketing activities under production orientation zfirm assumes that customers value low cost products that are widely available zfirm focuses on maintaining high production efficiency zmarketing management focuses on distribution metrics: cost of product creation zfunctional Leadership: Operations

Marketing activities under selling orientation zfirm assumes that customers must be led, or, if necessary, coerced to buy zmarketing management focuses on aggressive selling and promotion efforts z firm is sales management/promotion led zMetrics focus on sales lead conversion and number of new customers zFunctional leadership: Finance

The marketing concept: a philosophy of doing business zMeet customer needs - focus on providing customer satisfaction zMeet organizational goals zCoordinate marketing activities - the marketing mix: product, price, promotion, and distribution zDo these three better than the competition

Group Exercise zIdentify a retail firm that you think subscribes to the marketing concept yexplain your answer by describing the company point by point following the dimensions of the marketing concept zIdentify a retail firm that you think does not subscribe to the marketing concept yexplain your answer by describing the company point by point following the dimensions of the marketing concept

Marketing activities under marketing orientation zfirm assumes that customers needs must be discovered and met zmarketing management focuses on understanding the market segmentation process and what brings targeted customers satisfaction zalthough company needs must be met, firm is customer needs driven not company needs driven zmarketing activities are coordinated zfirm focuses on outperforming the competition

Marketing activities under marketing orientation zLove your customer not your product zFind a need and fill it zMeet customer needs profitably zHave it your way

zshared beliefs and values: put customer first zstrategy development process:external orientation, competitive advantage as theme zorganization structure and systems: mirrors the market, team-based zsupporting programs and actions: people, incentives, communications zthe four above are based on superior skills in understanding and satisfying customers Dimensions of market driven management

distinctive capabilities of market driven firms za set of values that place customers first zthe ability to manage information effectively (knowledge management) zsuccessful interfunctional coordination

Selling orientation versus marketing orientation zwhere process begins: factory zwhat is focus:sell products zhow is marketing performed: selling and promotion zwhy: meet company goals zwhere process begins: target market zwhat is focus: meet customer needs zhow is marketing performed: integrated marketing zwhy: meet customer needs and company goals

Exercise Instructions: Based on our discussion of the marketing concept and market driven management describe how you would assist a firm in changing its orientation from selling orientation to marketing orientation.

Exercise Instructions: Based on our discussion of the marketing concept and market driven management describe how you would assist a firm in changing its orientation from product orientation to marketing orientation.

definition of consumer marketing the marketing of products to people for their own, personal nonbusiness use

definition of business-to- business marketing the study of markets for product and services, local to international, bought by businesses, government bodies, and institutions for incorporation, for consumption, or for resale

Market segmentation The practice of dividing markets into distinct, different submarkets that have different needs regarding the elements of the marketing mix

Marketing Strategy A marketing strategy is a marketing mix that is designed for and aimed at a predetermined target market Product/service Price Promotion Place (Distribution) Segment 1 Segment 2 Segment 3 Segment 4 Potential Target markets

The marketing management tool box: the marketing mix (or four ps) zProduct or service (what benefits target market customers are seeking delivered in the way they prefer) zPrice (value = benefits minus costs) zDistribution (right time and right place) zPromotion (right communication: inform, persuade, remind)

Impact of e-business on marketing zUnderlying model the same - people still exchange value for value zDelivery mechanism radically different - that is, how the value is exchanged and delivered is different (local bookstore versus Amazon.com, for example) zEvery business should assess the impact of e-business on its operations