CHAPTER ONE AN OVERVIEW OF MARKETING © 2000 South-Western College Publishing Prepared by: Jack Gifford, Miami University (Ohio)

© 2000 South-Western College Publishing 2 WHAT IS MARKETING? Personal selling? Advertising? Making products available in stores? Maintaining inventories? It is all the above, plus much more!

© 2000 South-Western College Publishing 3 WHAT IS MARKETING? A philosophy plus An attitude plus A perspective plus A management orientation A set of activities, such as: products & services, pricing, promotion, and distribution + Marketing is 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 goals. =

© 2000 South-Western College Publishing 4 THE CONCEPT OF EXCHANGE What do we mean by the exchange process? zTwo or more parties zEach party must have something the other party values zCommunications and ability to deliver zFreedom to accept or reject offer zWant to deal with each other zAuthority and means to make transaction zMedium of exchange

© 2000 South-Western College Publishing 5 Marketing Management Philosophies zProduction orientation zSales orientation zMarketing orientation zSocietal orientation

© 2000 South-Western College Publishing 6 THE ORGANIZATON’S FOCUS Customer Value zRatio of values/benefits to necessary sacrifices zA core business strategy zDetermination of consumer’s definition and measurement of value? zSacrifices may be financial, psychological, sociological, level of perceived risk, time, etc. BENEFITS SACRIFICES

© 2000 South-Western College Publishing 7 THE ORGANIZATION’S FOCUS Customer value zOffer products that perform zGive consumers more than they expect zAvoid unrealistic pricing zGive the buyer facts zOffer organization-wide commitment in service and after-sales support

© 2000 South-Western College Publishing 8 THE ORGANIZATON’S GOAL Customer Satisfaction zHygiene Factors zSatisfiers z“Exceed customer expectations”

© 2000 South-Western College Publishing 9 Relationship Marketing to Stakeholders z Forging long-term partnerships with customers z Share of customer vs share of market concept z Long-run over short run yLoyalty programs yFrequent flyer programs But who are these stakeholders?

© 2000 South-Western College Publishing 10 WHO ARE THESE STAKEHOLDERS? zStakeholders are any person(s) or organization(s) that has an interest in the decisions and actions of the marketer: Shareholders Management Employees Customers Supply chain partners Communities in which marketers operate …… and many others

© 2000 South-Western College Publishing 11 TO SUCCEED IN RELATIONSHIP MARKETING, A MARKETER MUST... zDevelop customer-oriented personnel through… yTraining (Disney University) yEmpowerment (Federal Express) yTeamwork and team-building skills (Southwest Airlines )

© 2000 South-Western College Publishing 12 DIFFERENCES BETWEEN SALES AND MARKETING ORIENTATION

© 2000 South-Western College Publishing 13 DIFFERENCES BETWEEN SALES AND MARKETING ORIENTATION

© 2000 South-Western College Publishing 14 The Marketing Process zA mission statement consistent with the organization’s mission statement zSet measurable marketing objectives zEnvironmental Scan (Internal and External) zMarketing strategy (Tgt. Mkt. & marketing mix) zImplementation zMeasure performance against objectives zReview and feedack

© 2000 South-Western College Publishing 15 THE MARKETING PROCESS Marketing Strategy Target Market Strategy Marketing Mix [Product,Price,Promotion, Distribution] Implementation Evaluation Feedback MISSION STATEMENT SETTING MARKETING OBJECTIVES ENVIRONMENTAL SCAN ( S. W. A. T. )

© 2000 South-Western College Publishing 16 Why study marketing? zPlays an important role in society zMarketing is vital to business survival zMarketing affects your life every day zInternational implications zBe a more knowledgeable consumer AND...

© 2000 South-Western College Publishing 17 CAREER OPPORTUNITIES !!! zBetween a fourth and a third of the entire civilian workforce in the United States performs marketing activities, such as... Sales (organizational or consumer) Promotion (advertising, PR, sales promotions) Research Retailing Product management Logistics

© 2000 South-Western College Publishing 18 MARKETING AFFECTS YOUR LIFE EVERY DAY zAbout 50 cents of every dollar you spend pays for marketing costs. zBy understanding marketing, you will become a better- informed consumer and citizen zYou will better understand the buying process and be able to negotiate more effectively with sellers zYou will be better prepared to demand satisfaction when the goods and services you buy do not meet the standards promised by the marketer

© 2000 South-Western College Publishing 19 ETHICS IN MARKETING Healthy Versus Healthy Looking? Is it ethical for Coppertone to produce low ultraviolet ray protection products? zShould the sun-care industry only market goods that are healthy for the consumers, even though consumers want less healthy products?

© 2000 South-Western College Publishing 20 GLOBAL PERSPECTIVES z How are some upscale US catalog retailers successfully marketing their products to the younger generation and city dwellers in Japan? zHow are these US catalog retailers creating customer value? JAPAN