1. Copyright © 2002 by Harcourt, Inc. All rights reserved. Topic 9 : Marketing (1) Lecturer: Zhu Wenzhong

2. Copyright © 2002 by Harcourt, Inc. All rights reserved. Key learning goals: This topic will mainly discuss the definition of marketing, the importance of marketing and the difference between product and customer orientation. 1. State the definition of marketing 2. State the important features of marketing 3. Explain what factors have made marketing so important in today’s business environment. 4. Explain the difference between market orientation and product orientation 5. Explain the main advantages of market orientation for a business? LEARNING GOALS

3. Copyright © 2002 by Harcourt, Inc. All rights reserved.  What is meant by the term marketing? Marketing is the management of process involved in identifying, anticipating and satisfying consumer requirements profitably. Marketing is the process by which companies create customer interest in products or services. It generates the strategy that underlies sales techniques, business communication, and business development. It is an integrated process through which companies build strong customer relationships and create value for their customers and for themselves.  Differences between marketing and selling or advertising Marketing is not the same as selling. Selling is only one of many marketing functions, or is just one part of the marketing process. Marketing and advertising are not the same thing, either. Advertising is just one of a number of tactics used by marketing departments in a business. Other methods include promotions, such as free gifts or competition activities. Marketing (1) - Definition of marketing

4. Copyright © 2002 by Harcourt, Inc. All rights reserved. Marketing (1) -Important features of marketing  Marketing has at least the following characteristics: 1. Marketing is aimed at finding out consumer needs and meeting these needs. 2. Marketing must consider profit as its main objective. 3. Marketing is ongoing all the time. The marketing process has no start or end (see next slide). 4. Businesses must be prepared to respond to the consumer reactions and changes all the time.

5. Copyright © 2002 by Harcourt, Inc. All rights reserved. Figure 9-1 Ongoing Marketing Process Analyze and design marketing strategy Reconsidering consumer reactions Monitor consumer reactions Adapt the marketing strategy Marketing (1) -Important features of marketing

6. Copyright © 2002 by Harcourt, Inc. All rights reserved. Marketing (1) -Importance of marketing Marketing is playing a more and more important role in the success of a business. It can be said that “no marketing means no business”. There are generally some key factors which have made marketing so important for businesses today. The factors can be seen as in the following table:

7. Copyright © 2002 by Harcourt, Inc. All rights reserved. Table 9-1 Factors leading to the increasing importance of marketing FactorsExplain how 1.economic growth Economic growth leads to an increase of consumers’ incomes. So demand for products and services will be increased. Through marketing, businesses can promote their new products and services. 2. fashion Considerable changes in fashion and consumer taste force businesses to produce more new products and services. Marketing makes it possible for businesses to reach these changing customers. 3. technology New technology has helped the business to create new or high quality products. It is marketing that can makes customers be aware of these new products. 4. competition Facing more and more fierce competition, businesses must rely on marketing strategy to win in the marketplace. Marketing (1) -Importance of marketing

8. Copyright © 2002 by Harcourt, Inc. All rights reserved. Marketing (1) -Evolution of marketing An orientation, in the marketing context, relates to a perception or attitude a firm holds towards its product or service, essentially concerning consumers and end-users. Throughout history, marketing has changed considerably as consumer tastes are changing faster. The marketing orientation evolved from earlier orientations namely the production orientation (1950s), the product orientation (1960s) and marketing orientation (1970s). Recent approaches in marketing is the relationship marketing with focus on the customer, the business marketing or industrial marketing with focus on an organization or institution and the social marketing (1990s) with focus on benefits to the society. New forms of marketing also use the internet and are therefore called internet marketing or more generally e-marketing, online marketing, personalized marketing or one-to-one marketing. business marketingindustrial marketinginternetinternet marketingpersonalized marketing

9. Copyright © 2002 by Harcourt, Inc. All rights reserved. Marketing (1) -Product orientation and market orientation Theories  What is product orientation? Product orientation means that the business places the main focus of attention on the production process and the product itself. More emphasis on technology and quality, but less focus on meeting consumer needs in the market. Many businesses in the past were product orientated when there were quite few competitors and when they produced the unique products in the world, such as the radios when just invented. However, today there are still some businesses which are product orientated. For example, the Concorde airplane company (high technology, but expensive so not many customers taking their planes).

10. Copyright © 2002 by Harcourt, Inc. All rights reserved. Marketing (1) -Product orientation and market orientation Theories  What is market orientation? Market orientation or consumer orientation means that the business places the needs or requirements of consumers at the center of the decision-making process. Market orientation is perhaps the most common orientation used in contemporary marketing. It involves a firm essentially basing its marketing plans around the marketing concept, and thus supplying products to suit new consumer tastes. The implication is that businesses should try best to meet the need of customers in marketing management. A market orientation may have some advantages over product orientation. These advantages are seen in the following table:

11. Copyright © 2002 by Harcourt, Inc. All rights reserved. Marketing (1) -Product orientation and market orientation Theories  Some advantages of a market-orientated business over a product-orientated business: 1. More able to anticipate market changes 2. Respond quickly to market changes 3. More capable of meeting the challenges of new competition 4. More successful in new product development 5. Able to produce to produce and sell the right product at the right time and the right place 6. …

12. Copyright © 2002 by Harcourt, Inc. All rights reserved. Marketing (1) -Product orientation and market orientation Theories  What might a market-orientated business do in its marketing management? 1. Do market research continuously. 2. Design the product according to the consumers’ needs and wants. 3. Produce the product in the quantities that consumers want to buy. 4. Set the price of the product which can be acceptable by most consumers. 5. Respond to consumer changes quickly…

13. Copyright © 2002 by Harcourt, Inc. All rights reserved. Marketing (1) -Product orientation and market orientation Theories Questions for your critical thinking: 1. What are the possible shortcomings of a product-orientated business? 2. What are the possible disadvantages of a market-orientated business?