Marketing Dynamics The Marketing Concept

Objectives  Give examples of the five types of utility.  Explain the three elements of the marketing concept.  Describe the benefits of the marketing concept to business and customers.  List the seven functions of marketing.  Give an example of each marketing function and describe how it supports the marketing concept.

Marketing Terms  utility utility  adding value adding value  form utility form utility  place utility place utility  time utility time utility  information utility information utility  possession utility possession utility  customer satisfaction customer satisfaction  marketing concept marketing concept

What's Easier?  Lets say you want cornflakes for breakfast. Which is easier, plan A or Plan B?  PLAN A  Find a cornfield, pick corn, bring the corn home and remove the kernels, grind the kernels, mix ingredients, bake then flake! Oh don’t forget to find a cow, Yikes!  PLAN B  Go to the store, buy the product and take it home.

Utility?  Basically the cornflake story best describes business using utility…..and that’s what we are going to learn about.

 A business can add value to wood by converting it to furniture OR Paper

Utility  Utility is the ability of a product Utility  to satisfy human wants and needs  utility also means usefulness  The process of adding utility is often called adding valueadding value In what other ways can businesses add value to wood?

Utility  Types of utility  form  place  time  information  possession

Utility  Form utility Form utility  changing the form of a raw material or product to add usefulness.  Auto maker uses plastic, steel, glass and fabric to make a car

Utility  Place utility Place utility  making products available at convenient locations  Need money, ATM’s are banks using place utility in the best possible way.

Utility  Time utility Time utility  making products available at the time customers need or want them  This could also be businesses staying open longer to serve you

Utility  Information utility Information utility  providing the customer with information about a product  Advertising is a form of information utility…it’s about telling the customer what they need to know

Utility  Possession utility Possession utility  making it easier for a customer to acquire a product. This can be done by providing loans or accepting credit.

The Five Utilities Team Assignment Assignment: Design a presentation that illustrates the five utilities for one consumer product.

The Marketing Concept  Customer satisfaction Customer satisfaction  Developing the positive feelings that customers get when their expectations are met or exceeded Describe an experience of customer satisfaction.

The Marketing Concept  The marketing concept is an approach to businessmarketing concept  Three elements of the marketing concept  customer satisfaction –Done by adding utility or exceptional service  total company approach –Employees, finance, management & marketing team members must all work together  Profit –Finding the balance between providing great service and not losing money meeting those customers needs

The Marketing Concept  Businesses that follow the marketing concept  provide goods and services that meet or exceed customers’ expectations (customer satisfaction)  encourage all four functions of business to work together to provide customer satisfaction (total company approach)  balance satisfying customers with making sales (profit)

Describe some marketing activities.

The Functions of Marketing  The activities of marketing can be organized into seven functions  financing  information management  distribution  product/service management  pricing  promotion  selling

The Functions of Marketing  Financing  managing money for marketing activities  helping customers buy products by providing credit or financing List some financing activities.

The Functions of Marketing  Information management  gather, analyze, and distribute information –about markets, competition, and customers –Remember Wal-Mart and how they use their information?

The Functions of Marketing  Distribution  activities involved in getting products from producers to customers List some distribution activities.

The Functions of Marketing  Product/service management  developing new products  modifying existing products  deciding which products to carry in a store

The Functions of Marketing  Pricing  activities involved in setting prices for products  This could include competitors prices List some pricing activities.

The Functions of Marketing  Promotion  nonpersonal communication with customers –advertising –visual merchandising List some promotion activities.

The Functions of Marketing  Selling  personal communication with customers List some selling activities.

The Functions and the Marketing Concept  All of the functions of marketing  help a business focus –on satisfying customers’ needs and wants –while making a profit Give examples of how each function supports the marketing concept.

Review  Give examples for each of the five types of utility.  What are the three elements of the marketing concept?  Describe the seven functions of marketing.

Glossary  adding value. Adding a feature or service that makes a product meet more customer wants and needs.  customer satisfaction. Positive feeling a customer gets when the product purchased meets or exceeds the customer’s expectations. Back

Glossary  form utility. Type of utility added to a product when a business changes the form of something to make it more useful.  information utility. Type of utility added to a product when a business provides information about a product to a customer. Back

Glossary  marketing concept. Approach to business that says that the way to make a profit is to focus on customer satisfaction.  place utility. Type of utility added to a product when a business makes products available at convenient places. Back

Glossary  possession utility. Type of utility added when a business makes it easier for a customer to acquire a product.  time utility. Type of utility added to a product when a business makes products available at the times that customers want them.  utility. Ability of a product to satisfy human wants and needs. Back

 7 Functions of Marketing Assignment