1. SECTION 1.2 REVIEW - click twice to continue - LESSON 1.3 Fundamentals of Marketing

2. Objectives Describe the concept of market Differentiate consumer and industrial markets Describe market share Define target market List the components of the marketing mix Note: Try to memorize the terms in this section, because you will use them throughout your study of marketing! Marketing Essentials Chapter 1, Section 1.3

3. Market Can you expect your product to appeal to everyone? Market , refers to all the people who might buy a product who: Share similar needs and wants Have the ability to purchase a product Example: If you have an interest in hunting and want a Bonnelli Shot Gun, you are in a specific market Marketing Essentials Chapter 1, Section 1.3 No

4. Types of Markets There are two different types of markets with different goals and objectives –Consumer –Industrial

5. Consumer Versus Industrial Markets Consumer market: all consumers who purchase goods and services for personal use Consumers want products and services that: Save money Make life easier Improve appearance Create status Provide personal satisfaction Marketing Essentials Chapter 1, Section 1.3

6. Consumer Versus Industrial Markets industrial market: businesses that buy products, often in large quantities, to use in their operations; Businesses want products and services that: Improve productivity Improve efficiency Increase sales Decrease expenses

7. A single product may be promoted to both the consumer and industrial markets. For example, Perdue advertises its chicken and turkey products: On television and in newspapers, to reach consumers In the publication Supermarket News, to reach professionals in the supermarket industry Note: Businesses will have have two separate and distinct marketing plans to reach each market Marketing Essentials Chapter 1, Section 1.3

8. Assignment Opinion: What company sells the largest number of cell phone sales in the cell phone market? Go to our Webpage and Read Market Share Article Read and complete the notes for this section

9. Assignment Go to our Webpage and Read Market Share Article Read and complete the notes for this section

10. Market Share Example: If you sell in the Blue Ray players Total Sales = $4,567,850 Your Sales = $2,985,000 What is your total Market share? Marketing Essentials Chapter 1, Section 1.3 2,985,000/4,567,850 = 65.3%

11. Market Share Example: If you sell in the video game market Total Sales = 1,500,000 Your Sales = 248,000 What is your total Market share? If “Competitor X” has sales of 237,000 what is its market share? What percentage of the market is with all your other competitors? Are you in a good position? Unclear because you don’t know all the competition! Marketing Essentials Chapter 1, Section 1.3 248,000/1,500,000 = 16.5% 237,000/1,500,000 = 15.8% 100 – (16.5 +15.8) = 67.7%

12. Market Share Market share changes continually as: New competitors enter the market The market’s volume increases or decreases Is it important to know your market share? Why? Helps you analyze your competitors and their position in the market. Marketing Essentials Chapter 1, Section 1.3

13. Target Market and Market Segmentation Marketers look for ways to find those who want their product most: –market segmenting: is the process of classifying customers by needs and wants Goal = find people most likely to become customers –target market: A group of people identified as those most likely to become customers all marketing strategies directed at target market

14. Target Market and Market Segmentation Will your product only target one market? A single product may have these two target markets: Consumers –those that use or consume product Customers – those that purchase the product For example, who is children’s cereal targeted at Children- request it and eat it= Parents - approve and buy it = No Consumers Customers

15. How would you reach children? How would you reach parents?

16. Customer Profile To develop a clear picture of its target market, a business may create a customer profile customer profile  A list of information about the member of a target market What are some things that can be used to segment a target market? Student contributions?

17. Customer Profile What are some things that can be used to segment a target market? Age Income level Ethnic background Occupation Attitudes Lifestyle Geographic residence

18. Marketing Mix The marketing mix  includes four basic marketing strategies, or tools, called the four Ps that is used to influence buying decisions of a target market product place price promotion Actions & decisions in these areas are based on the people marketers want to win over people: some would add a fifth “P” as a result Marketing Essentials Chapter 1, Section 1.3

19. Marketing Mix Video: Click frame below to play video. If this does not work, click the “Video” link for the Youtube video!Video Marketing Essentials Chapter 1, Section 1.3

20. Product A company must choose what products to develop, update, and improve. Much goes into Product design: Features – size of screen, color, material Brand Name Packaging Service Warranty Improvements to existing products Identifying new target markets Marketing Essentials Chapter 1, Section 1.3

21. Place A company must decide where to sell and distribute a product. Know where target market shops Directly to consumers or is an intermediary required Internationally, locally, or on internet What distribution method to use (warehouse, air, ship, rail) What stock levels are the most effective Place strategies determine how and where it will be distributed Marketing Essentials Chapter 1, Section 1.3

22. Price A company must determine what price it will charge for a product Should reflect what customers are willing to pay Consider what competition is charging Must decide what to charge industrial customers and retailers Establish both a price for the retailer and a suggested retail price Establish discount prices Establish credit terms and payment terms Marketing Essentials Chapter 1, Section 1.3

23. Promotion A company must decide how to advertise, promote, and publicize a product. How potential customers will be told about products Includes: Message Media selected Special offers Timing of promotional campaigns

25. Product: 1/3 Less Sugar/Calories No Pulp Pour Spout Design Brand: Light N Healthy Tropicana Place: Grocery Stores Gas/Convenience Stores Global Distribution – ship, truck, train Warehouse to store Price: Inline with competitors What customers willing to pay Have a price of industrial market Retail Price for consumers Have Discounts for industrial mkt Credit terms for industrial market Promotion TV Commercials Newspapers Fitness Magazines Health Magazines Family Magazines Sales Calls w/samples