Chapter 1 Marketing Is All Around Us

Learning Objectives Students will be able to define marketing Students will be able to identify the 9 functions of Marketing

3Chapter 1 MARKETING TODAY AND TOMORROW 1-1 What Is Marketing? Basic definition of Marketing Why it’s important for students to study Marketing CHAPTER 1

What is Marketing? Note to students: Turn your notes page sideways and write your own definition of marketing.

What is Marketing? 1.The process of developing, promoting, and distributing products in order to satisfy customers’ needs and wants. 2.Bringing the buyer and the seller together. – Needs: Food, Shelter, Clothing, oxygen – Wants: Harley, snowmobile, boat Products – Goods and services. What was your answer?

Chapter 16 Why Study Marketing? 1.Marketing is exciting, important and profitable. 2.Businesses, individual consumers, and our economy benefit from effective marketing. 3.Marketing is an important part of business operations. 4.Marketing is essential to the success of businesses, manufacturers, retailer, government agencies, hospitals, law offices, schools and churches. – Marketing leads to satisfied customers and a successful, profitable business.

Careers in Marketing

Chapter 18 Where does marketing take place? Advertisements (newspapers, magazines, billboards) Products being transported by truck, train and airplane Marketing researchers surveying shoppers in shopping malls Marketing is everywhere!

Chapter 19 When are consumers involved in Marketing? You make marketing decisions and participate in marketing activities every day. 1. You are involved in marketing when you decide to make a purchase in a store or on the Internet. 2. When you decide whether to pay for an item with cash or a debit card. 3. When you pay to transport a bulky item to your home rather than transport it yourself.

List items you used this morning Product 1. Deodorant Product Brand Name 1. Sure, Axe, Secret

Why are there so many different varieties of a product? Consumers have different wants and needs.

What type of people do these shampoo manufacturers target?

How did the manufacturer know what type of shampoo their customers would want? Survey Gather information Process information

How do you know about a new product? TV Magazine Radio This is how the manufacturer communicates their product to you.

Chapter 115 How do businesses use marketing? Every business today is involved in marketing, some more so than others. Over 4 million companies in the United States have marketing as their primary business activity. Many companies budget 50 percent of their expenses for marketing activities each year. – Companies worldwide spend over $250 billion on just advertising (a portion of marketing) each year.

Chapter 116 Types of Businesses Directly Involved in Marketing

Chapter 117 Types of Businesses with Major Marketing Activities

Chapter 118 Types of Businesses with Limited Marketing Role

Chapter 119 Marketing Activities Many activities need to be completed before a product is sold. Marketing functions Companies use the marketing functions MARKETING FUNCTIONS 1.Market planning 2.Product/service management 3.Distribution 4.Pricing 5.Promotion 6.Selling 7.Marketing-information management 8.Financing 9.Risk management

1. Market Planning Think of all the products you have used today. – Breakfast – Toothpaste – Deodorant – Shampoo/Conditioner – Soap – Toiletries All these products were created to meet your needs. Market planning is identifying and understanding the markets a company wants to serve and developing effective marketing strategies for each market.

2. Product and Service Management To produce the products that you need and want, businesses need to design and develop products and services to satisfy you. How did those products you used this morning meet your needs? – Convenient – Ease of use – Spray/aerosol – Combination (shampoo and conditioner) – Taste – Smell

Delivery of manufacturers’ products Part of marketing – Trucks – Airplane – Ship Moving goods from producers of products to consumers. Determining the best methods and procedures to be used so prospective customers are able to locate, obtain, and use the products and services of an organization. 3.

4. PRICING Deciding how much to charge for goods and services is known as pricing. Most pricing decisions take competition into consideration, as well as how much a customer is willing to pay. Establishing and communicating the value of products and services to prospective customers.

5. PROMOTION Reading the newspaper or a magazine you see several advertisements. – If you see something you’re interested in, you may buy it. You didn’t need it previously, but now you want it. You go to the mall to purchase it. The window displays (advertising), encourage you to enter their store. – Sale – 20-50% off. This is a promotional technique of marketing. Communicating information to prospective customers through advertising and other promotional methods to encourage them to purchase the organization’s products and services. YOUR AD HERE

6. Selling Sales associate – Assist you in your purchase Personal selling is a part of marketing Direct, personal communications with prospective customers in order to assess needs and satisfy those needs with appropriate products and services.

7. Marketing-Information Management Have you ever been approached by someone at the mall with a clipboard asking you to take a survey? Have you ever been asked to answer a few questions over the telephone? Obtaining, managing, and using market information to improve decision making and the performance of marketing activities.

8. Financing Getting the money needed to finance the operation of a business is known as financing. Financing also includes decisions regarding offering credit to customers. Budgeting for necessary financing, and providing financial assistance to customers to assist them with purchasing products and services.

9. Risk Management Preventing or reducing business loss is known as Risk Management. – What will you do if a new competing business comes to town? Plan for disaster and you will be prepared. React to disaster and you may not be successful. – Other risks include employee or customer accidents, as well as natural risks such as floods or fires. Providing security for products, personnel, and customers and reducing the risk associated with marketing decisions and activities.

9 Functions of Marketing

How Companies Use the Marketing Functions Activities being performed by companies as they develop new products, improve marketing procedures, and respond to customer needs. Apple used product/service management by combining the technologies of a widescreen iPod, a cellular telephone, and an improved Internet browser to produce the iPhone.

How Companies Use the Marketing Functions Led by Hertz, most airport rental car companies now offer a convenient distribution strategy. Through a prearranged rental agreement completed online or by telephone, the customer’s automobile is waiting with all paperwork completed to speed his or her departure.

How Companies Use the Marketing Functions Many professional firms are recognizing the importance of personal selling. – Selected executives in law offices, accounting firms, and banks are completing professional sales training in order to effectively obtain new clients and handle their needs.

How Companies Use the Marketing Functions An example of marketing- information management is the use of electronic scanners at supermarket checkouts. They provide information about purchases so that manager can instantly determine what is being purchased, enabling them to keep the best assortment of products available.

How Companies Use the Marketing Functions To reduce their inventory of existing homes when there is a slump in housing sales, a major construction company offers customized decorating and new furnishings to customers who sign a purchase contract within 30 days. Rather than cutting the price of the home, this pricing incentive works to maintain sales levels while competitors continue to struggle.

How Companies Use the Marketing Functions Businesses who sell expensive products such as oceanfront condominiums, personal aircrafts, or yachts, will prepare high quality promotional CDs and brochures that provide detailed product information. These promotional materials are then sent to selected customers interested in purchasing the product.

How Companies Use the Marketing Functions Major automobile manufacturers demonstrate the financing function when they maintain their own financing organizations to make loans or provide leases to consumers who purchase their product from local dealers.

Prepare for a Career in Marketing To prepare for a career in marketing, you need a broad understanding of all the marketing functions and activities. You will also need to develop strong skills in one or more of the functions.

9 Functions of Marketing Group Activity Complete the 9 functions of Marketing Group Activity.

Chapter 140 Focus Questions: What marketing activities are being demonstrated by Cargill in the advertisement? Why do you believe a large international company like Cargill is concerned about how to get products to consumers living in Central America? AD PROVIDED WITH PERMISSION BY CARGILL. ©2007 CARGILL, INCORPORATED.

Marketing Changes Changes had to be made to this definition because marketing now includes customer research and product development activities. It applies to nonprofit businesses and to organizations not considered businesses (churches, schools, libraries). Not only is marketing used for products and services, it is also used for individuals (political candidates, artists, sports stars) and even to promote ideas (stop smoking, recycle, stay in school).

AMA (American Marketing Association) Marketing Definition Simple Definition 1960-The performance of business activities that direct the flow of goods and services from producer to consumer or user.

AMA Marketing Definition 2004-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.

Marketing Marketing is the creation and maintenance of satisfying exchange relationships. Creation – Marketing is involved form the beginning as products and services are being developed. Maintenance – That marketing must continue to be used as long as a business or organization is operation. Satisfaction-Both the business and the customer is an important goal of marketing. Exchange Relationship –Any exchange where people are giving and receiving something of value.

Value Marketing Because Marketing can be applied in different ways in various organizations, and because marketing needs to be easily understood, the following definition describes the value marketing offers to those who use it well.