Marketing Chp 1

• Marketing involves business practices for planning and presenting an organization's products or services to build effective consumer relationships.
• The marketing mix consists of the 4 P's.
• Good marketing is not random.

Providing Value

• Involves building and maintaining a loyal customer base.
• Requires making a product that satisfies a variety of consumer demands.
• Consumer positioning is important for establishing value and protecting the brand.

Core Aspects of Marketing

• Occurs across settings and helps create value.
• Satisfies customer needs and wants through exchanges.
• Requires decisions related to the 4Ps (Product, Price, Place, Promotion) and can be done by individuals and organizations.

Satisfying Customer Needs & Wants

• A need is a basic necessity, while a want is how to fulfill that need, referred to as a market segment.
• Target markets are the customer segments a firm is interested in selling to.

Marketing Exchange

• The exchange can occur between any 2 parties.
• It's not simply a buyer and seller exchanging money for a good or service.
• Exchanges can also involve information for convenience.

Marketing Mix Decisions (The 4 P's)

• Product (creating value): includes product/service, brand, size, quality, features, packaging, warranty
• Price (transacting value): includes list price, discounts, allowances, costs, payment period, credit terms.
• Place (delivering value): includes marketing channels, distribution intensity, and locations such as online retailers, supply chains, and logistics.
• Promotion (communicating value): includes advertising, sales promotion, personal selling, public relations, direct marketing, and electronic media.

Marketing Mix: Product (Creating Value)

• Includes goods, services, and ideas.
• All watches tell time, but some brands, like Rolex, are marketed as status symbols

Promotion of Ideas

• Creates value by including thoughts, opinions, philosophies, and intellectual concepts that can be marketed.

Consumer Behavior: Bottled Water

• Bottled water is more expensive than tap water, with consumers paying 120 to 7500 times as much per gallon.
• Convenience, perceived safety (less minerals, luxury/cool feeling) drive the high cost.
• People often prefer tap water in blind taste tests with no prior opinions.

Marketing Mix: Price (Transacting Value)

• Price encompasses everything the buyer gives up in exchange for a product, including money, time, and energy.

Marketing Mix: Place (Delivering Value)

• Includes all activities necessary to get a product to the right customer at the right time.
• Supply chain management examines these activities.
• The marketing mix considers where to find a product in the store.

Place (Marketing Channels Distribution Strategy)

• Focuses on how a company gets the product to the customer when and where they want it.

Marketing Mix: Promotion (Communicating Value)

• Includes communication activities to inform, persuade, and remind potential buyers.
• Promotion informs, persuades, and reminds potential buyers about a product or service.

Individuals & Organizations in Marketing

• Marketing can be performed by both individuals and organizations.
• B2B (Business to Business): Wholesaling, such as Dell Canada to Best Buy Canada.
• B2C (Business to Consumer): Retailing, such as Best Buy Canada to consumers.
• C2C (Consumer to Consumer): Transactions via swap meets, eBay, yard sales, etc., where consumers sell to each other.

Impact of Marketing

• Marketing impacts many stakeholders.
• Includes both profit and non-profit entities.
• Has an impact on developing economies and entire industries.

Orientations of Marketing

• Product Orientation: Focus on developing and distributing innovative products with little concern for customer needs, e.g., Ford Model T.
• Sales Orientation: Views marketing as a selling function, focusing more on selling products than understanding consumer wants.
• Market Orientation: Focuses on understanding what consumers want and need before designing or selling products.
• Value-based Orientation: Firms focus on the triple bottom line: people (consumer needs & wants), profits (long-term profitable relationships), and planet (social & environmental responsibility).

Becoming Value-Driven

• Requires firms to share information.
• Must balance benefits and costs.
• Build relationships with customers.
• Use technology to connect with customers.

Sharing Information

• Firms like Zara collect purchase information and research customer trends to forecast sales and coordinate deliveries.
• Some firms use sophisticated IT for customer tracking and supply chain functions
• A focus on the supply chain can result in growth in store availability, and quick product movement

Building Customer Relationships - CLV (Customer Lifetime Value)

• Takes a long-term view of customer relationships.
• Uses data to assist in maintaining such relationships, called CRM (Customer Relationship Management). Embraces social media to better connect with customers

Connecting With Customers Using Social Media

• Embraces social media for better connection with customers
• Most North American companies use social media for marketing.
• Consumers are driving brand and store interactions via social media

Balancing Benefits with Costs

• Emphasis on understanding and focusing on key benefits.
• Firms should eliminate costs of fewer strategic benefits

Marketing's Importance

• Expands global presence and can be entrepreneurial.
• Enriches society and makes life easier.
• Is persuasive across the supply chain.
• Enables goods to be available from multiple countries, so companies understand customer needs in different regions and segments

Persuasive Across Channels

• Every step involves creating value for customers and the end user.
• All members focus on what the end user/customer values

Marketing Enriches Society

• Canadian companies with a strong social orientation show consumers they can be trusted.

Marketing Can Be Entrepreneurial

• Marketing is important to success, especially for new ventures.