Unit One Marketing Principles

Marketing Principles International Marketing BINGO First horizontal wins a prize. First vertical wins a prize. First diagonal wins a prize. First to get two complete lines, either horizontal or vertical wins a prize. First to complete the entire card.

Unit 1 Vocabulary Absolute Advantage Agricultural Dependency Balance of Trade Capital Resources Capitalism Command Economy Communism Comparative Advantage Consumer Price Index Customers Developing Country Economics Entrepreneurship Resources Foreign Debt Foreign Exchange Rate Gross Domestic Product Gross National Product Human Resources Inflation Infrastructure Less-Developed Country Literacy Rate Marginal Utility Market Economy Market Price Marketing Mixed Economy Natural Resources Privatization Scarcity Socialism Technology Rate

Unit 1 Essential Question What are the major concepts of marketing principles?

Amplifying Questions Essential Question 1 Marketing Principles How do the basic marketing concepts relate to a specific market? What constitutes value for customers and consumers alike? What are the different ways a market can be segmented? What are the five P's of the marketing mix? Marketing Essentials pg. 12-19, pg 37-41

Marketing is. . . The process of developing, promoting, and distributing products in order to satisfy customers needs and wants.

Customers Vs. Consumers Buy a product Consumers Use the product

Marginal Utility Law of Diminishing Marginal Utility: Usefulness or utility of a product decreases as the number of units of the product obtained by the customer increases.

Identifying Your Customers Market Market Segmentation Geographics Demographics Psychographics Product Benefits

Identifying Your Customers Developing a Customer Profile Combining geographic, demographic, psychographic, and product benefit data to get a complete picture of your potential customers.

The Marketing Mix Product Place 5 P’s of Marketing Price Promotion People

Amplifying Questions Essential Question 2 Marketing Principles How do the basic economic concepts relate to a free enterprise system? What is a free enterprise system? What are the roles of government in a free enterprise system? What are the roles of a consumer in a free enterprise system? Marketing Essentials pg. 100-106, pg 124-132,

Free Enterprise System People have the right to make economic choices. Can choose what products to buy. Can choose to own property. Can choose to start a business and compete with others.

Basic Economic Principles Competition Price Competition Non-price Competition Monopoly Risk Profit

The Role of Government Provide general services. Support businesses to promote the growth and development of the country. Regulates business to ensure fair business practices and safety of consumers. Compete with businesses on a small scale.

Role of the Consumer Decides which businesses survive with their shopping “votes.” Determine the demand for a product and thereby dictate the price of the product.

How do supply and demand interact to set prices? What is elasticity? Amplifying Questions Essential Question 3 Marketing Principles How do the laws of supply and demand relate to prices and elasticity? How do supply and demand interact to set prices? What is elasticity? Marketing Essentials pg. 106-108 International Business pg. 32-34

Price-Setting Activities Supply is the relationship between the amount of a good or service that businesses are willing and able to make available at the price. Demand is the relationship between the amount of a good or service that consumers are willing and able to purchase at the price. Market price is the point at which supply and demand cross.

Elasticity of Demand Elastic: A small change in price causes a significant change in demand. Inelastic: Any change in price has little to no effect on demand. No acceptable substitute. Price change is small relative to buyer income. Product is a necessity.

Elasticity Formula Ed is the coefficient of elasticity.

Coefficient of Elasticity If Ed > 1 then demand is elastic. If Ed < 1 then demand is inelastic. If Ed = 1 then demand has unit elasticity.

Elasticity Effect on Revenue

Supply and Demand Demand Supply Market Price

Amplifying Questions Essential Question 4 Marketing Principles What is an economy and how is it defined? What are the four main factors of production? How do different countries make economic decisions? What are the different types of economic models? Marketing Essentials pg. 52-59 International Business pg.36-39

What is an Economy? Economy: A system by which a nation decides how to use its resources to produce and distribute goods and services. Resources: All the things used in producing goods and services. Also known as factors of production.

Factors of Production Land (Natural Resources) Labor (Human Resources) Capital Resources Entrepreneurship Resources Scarcity: Condition that exists when people’s wants and needs exceed their resources.

How Economies Work In deciding how to use their limited resources, nations, businesses, and people must answer three basic economic questions. What goods and services should be produced? How should the goods and services be produced? For whom should the goods and services be produced?

Types of Economic Systems Command Economies Market Economies Private property Profit motive Free, competitive marketplace Mixed Economies

Amplifying Questions Essential Question 5 Marketing Principles How is economic development achieved? What are the factors that affect economic development? What are the different levels of economic development? International Business pg. 41-43

Development Factors Infrastructure Literacy level Technology Agricultural dependency

Types of Development Industrialized countries Less-developed countries Developing countries

Levels of Economic Development Less-Developed Country Developing Country Industrialized Country Low literacy Limited technology Agricultural or mining economy Very poor infrastructure Improving literacy Improving technology Decreasing dependence on agriculture or mining economy Developed infrastructure High literacy Modern technology Industrial economy Highly developed infrastructure

Amplifying Questions Essential Question 6 Marketing Principles How is economic progress measured? What are the economic principles that explain the need for international trade? What economic indicators are used to measure economic progress and development? Marketing Essentials pg. 60-67 International Business pg. 46-50

Economics of Foreign Trade Absolute advantage exists when a country can produce a good or service at a lower cost than other countries. Comparative advantage exists when a country can produce a good or service with more efficiency than other countries.

Measuring Economic Progress Measure of Production Gross domestic product (GDP) Gross national product (GNP) International Trade Activity Balance of trade Foreign exchange rate Foreign debt Other Economic Measurements Consumer price index (CPI) Unemployment