Introduction to Marketing

• Marketing is an organizational function and a set of processes for creating, communicating, and delivering value to customers.
• Marketing involves managing customer relationships to benefit the organization and its stakeholders.
• Marketing management is the art and science of choosing target markets.
• Marketing management includes getting, keeping, and growing customers.
• It achieves this through creating, communicating, and delivering superior customer value.
• Goods, services, events, experiences, persons, places, properties, organizations, information, and ideas can all be marketed.
• A simple marketing system involves communication, goods/services, and money flowing between industry (sellers) and the market (buyers).
• Key customer markets are: consumer, business, global, and nonprofit/government markets.
• Core marketing concepts include needs, wants, demands, target markets, positioning, segmentation, and value and satisfaction.
• Marketing channels, competition, and the marketing environment are also key concepts.

Needs, Wants, and Demands

• Needs are basic human requirements.
• Wants are needs directed to specific objects that could satisfy them.
• Demands are wants for specific products, backed by an ability to pay.
• Stated needs are what the customer says they want, e.g., an inexpensive car.
• Real needs refer to what the customer truly wants, such as low operating costs for a car.
• Unstated needs are expected but not explicitly mentioned, like good service from a dealer.
• Delight needs are extra features the customer would like, such as an onboard navigation system.
• Secret needs involve how the customer wants to be perceived, like as a savvy consumer.

Target Markets, Positioning, and Segmentation

• Marketers divide the market into segments because they can rarely satisfy everyone.
• Marketers decide which segments present the greatest opportunity, and those are target markets.
• Firms then develop a market offering that it positions in the minds of the target buyers.
• Positioning aims to deliver some central benefit, like Volvo being "the safest car a customer can buy".

Value and Satisfaction

• Buyers choose between offerings based on which delivers the most value.
• Value reflects the sum of perceived tangible and intangible benefits and costs to customers.
• Value is a central marketing concept, primarily a combination of quality, service, and price (qsp), known as the customer value triad.
• Value increases with quality and service, and decreases with price.
• Satisfaction reflects a person's judgments of a product's performance in relation to expectations.
• If performance falls short of expectations, customers are dissatisfied.
• Customers are satisfied if performance matches expectations.
• Customers are delighted if performance exceeds expectations.

Marketing Channels

• Communication channels deliver and receive messages from target buyers.
• Distribution channels display, sell, or deliver the physical product/services, e.g., wholesalers and retailers.
• Service channels carry out transactions with potential buyers, e.g., warehouses, banks and insurance companies.
• Competition includes all the actual and potential rival offerings and substitutes a buyer might consider.
• The marketing environment includes demographic, economic, political-legal, technological, socio-cultural, and natural factors.

Company Orientations

• Company orientation toward the marketplace can be production, product, selling, or marketing focused.
• The production concept is the oldest, focusing on widely available and inexpensive products.
• The production concept makes sense in developing countries like China or when a company wants to expand the market.
• The product concept proposes consumers favor products that offer the most quality, performance, or innovative features.
• However, managers can be too focused on their products with this concept.
• The selling concept holds that consumers won't buy enough if left alone, requiring aggressive selling and product effort.
• This concept is used for unsought goods (e.g., insurance) or with overcapacity.
• The marketing concept emerged in the mid-1950s as a customer-centered, sense-and-respond philosophy.
• The goal shifts from finding the right customers for products to finding the right products for customers.
• Achieving organizational goals requires being more effective than competitors in creating, delivering, and communicating superior customer value.
• The holistic marketing concept is based on the development, design, and implementation of marketing programs that recognizes breadth and interdependencies.
• It recognizes "everything matters" in marketing and requires a broad, integrated perspective.
• Holistic marketing aims to recognize and reconcile the scope and complexities of marketing activities.

Relationship Marketing

• Relationship marketing focuses on building deep, enduring relationships with people and organizations that affect the firm's marketing activities.
• Relationship marketing aims to build mutually satisfying long-term relationships with key constituents to earn and retain their business.
• Four key constituents for relationship marketing are customers, employees, marketing partners (channels, suppliers, distributors, dealers, agencies), and members of the financial community.
• The ultimate outcome is a marketing network, a unique company asset.
• A marketing network includes the company and all supporting stakeholders with whom it has built mutually profitable business relationships.

Integrated Marketing

• Integrated marketing occurs when marketing activities are devised to create, communicate, and deliver value such that "the whole is greater than the sum of its parts".
• The key themes are that different marketing activities communicate and deliver value and that coordinated activities maximize joint effects.
• Marketers should design and implement any marketing activity with all other activities in mind.

Internal Marketing

• Internal marketing involves hiring, training, and motivating able employees who want to serve customers well.
• Marketing activities within the company can be as important or more so than those directed outside the company.
• Internal marketing requires vertical and horizontal alignment so everyone understands, appreciates, and supports the marketing effort.

Performance Marketing

• Holistic marketing requires understanding the financial and nonfinancial returns to both business and society.
• Top management examines the marketing scorecard, market share, customer loss rate, customer satisfaction, and product quality.
• Performance marketing also factors in the legal, ethical, social, and environmental effects of marketing activities.
• Marketers are increasingly asked to justify their investments to senior management.
• Justification should be in terms of financial, profitability, brand building and customer base growth.
• The effects of marketing extend beyond the company and customer to society.
• Marketers must consider their roles in broader ethical, environmental, and social contexts.
• The societal marketing concept focuses on determining the needs, wants, and interests of target markets, while delivering desired satisfactions.
• It aims to do all the above more effectively than competitors, while enhancing the consumer's and society's long-term well-being.

The Marketing Mix

• The marketing mix includes product, price, promotion, and place.
• Product includes product variety, quality, design, features, brand name, packaging, sizes, services, warranties, and returns.
• Price includes list price, discounts, allowances, payment period, and credit terms.
• Promotion includes sales promotion, advertising, sales force, public relations, and direct marketing.
• Place (distribution) includes channels, coverage, assortments, locations, inventory, and transport.

The New Four Ps

• The New Four Ps are people, processes, programs, and performance.
• People reflects internal marketing and the importance of employees.
• It also means viewing consumers as people and understanding their lives.
• Processes reflects the creativity, discipline, and structure brought to marketing management.
• Instituting the right processes guides activities and programs in mutually beneficial long-term relationships.
• Programs encompasses all the firm's customer-directed activities.
• It encompasses the old four Ps and other activities not fitting into the old view of marketing.
• Performance captures the range of possible outcome measures with financial and nonfinancial implications, and it also captures implications beyond the company itself.
• Marketing management tasks involve developing market strategies and plans, capturing marketing insights, connecting with customers, building strong brands, shaping market offerings, delivering value, communicating value, and creating long-term growth.

Marketing is creating, communicating, and delivering value to customers, involving customer relationship management to benefit the organization. Marketing management selects target markets and focuses on acquiring, retaining, and growing customers. Goods, services, events, and ideas can all be marketed through various channels.