Customer Satisfaction Customer satisfaction is the extent to which a firm fulfills a consumer’s needs, desires, and expectations As some needs are met, others may become more important Expectations may change based on experiences –Satisfying experiences may lead to increasing expectations –Disappointing experiences may reduce expectations –Expectations may be realistic or unrealistic

What Is Marketing? MICRO-MARKETING: –the performance of activities that seek to accomplish an organization's objectives by anticipating customer or client needs and directing a flow of need-satisfying goods and services from producers to customer or client MACRO-MARKETING: –a social process that directs an economy's flow of goods and services from producers to consumers in a way that effectively matches supply and demand and accomplishes the objectives of society AMA COMMITTEE DEFINITION: –marketing is the process of planning and executing conception, pricing, promotion, and distribution of ideas, goods, and services to create exchanges that satisfy individual and organizational objectives

Economic Systems Marketing-Directed Economic Systems Planned Economic Systems Consumer choices are the invisible hand that guides the economy Government planners decide what consumers should get

Micro-Macro Dilemma Micro-macro dilemma: what is "good" for some producers and consumers may not be good for society as a whole. Examples: –some consumers want handguns, but guns can be dangerous –all terrain vehicles are fun for some people, but may result in injuries or damage to wilderness areas –non-returnable soft drink bottles are convenient, but sometimes result in litter and dangerous broken glass along highways. –repairing an old air-conditioning system might save the owner money, but might require continued use of ozone depleting fluorocarbons (used as coolant)

Stages of Economic Development 1. Self-supporting agriculture 2. Preindustrial or commercial 3. Primary manufacturing 4. Nondurable and semidurable consumer products manufacturing 5. Capital equipment and consumer durable products manufacturing 6. Exporting manufactured products

Nations’ Macro-Marketing Systems Are Connected Economic growth has prompted more international trade World Trade Organization (WTO) –Only international body dealing with the rules of trade between nations –Replaced the General Agreement on Tariffs and Trade (GATT) Tariffs and quotas may reduce trade

Economies of Scale Economies of Scale: as a company produces larger numbers of a particular product, the cost for each of these products goes down. Facilitated by mass production Facilitated by mass distribution Not always possible (for example, in labor intensive services) Flexible production--to meet varying or changing needs--may be more important than economies of scale in creating real customer value

Facilitators Ad agencies Marketing research firms Information technology suppliers Product testing labs Public warehouses Transporting specialists Financial institutions... and others

Some Criticisms of Marketing Some criticisms focus on micro- marketing and some focus on the whole macro-marketing system: –"Too many ads are annoying, misleading, or both." –"There are too many unnecessary products." –"Middlemen raise prices but don't add value." –"Marketing makes people materialistic." Many criticisms result from misunderstandings about marketing!

Marketing Orientation Trying to carry out the marketing concept Maintaining a customer orientation –All departments work together guided by customer needs –Focus on profit objective (or other overall objective) –NOT just trying to "unload" what the firm has produced