Marketing Concepts Overview

Study Notes

Marketing Definition

Marketing is a company's process for conducting business with the primary focus on meeting customer needs and wants in decision-making.
Marketing focuses on understanding the buyer's approach rather than only on production.

Marketing Principles

Marketing is more than just a department or function; it's a way of life for a company.
Marketing encompasses various aspects, including product development, creation, innovation, delivery, and exchange (mutually beneficial).
Marketing involves two-way communication to build relationships with customers, stakeholders, and the public by delivering and exchanging products or services through logistics and physical distribution.
The goal of marketing is to create a mutually beneficial exchange that offers value.

Marketing Approach

Businesses focus on the customer as the center of their decision-making process. This includes aspects like operations and location choices.

5 Core Concepts of Marketing

Needs, Wants, and Demands:
- Needs are inherent and marketers do not create them. They represent a state of felt deprivation, a fundamental part of human nature. You can't live without them.
- Wants are influenced by culture and personality, and marketers can influence them through their brands.
- There are three types of needs:
  - Physical needs (e.g., food, sleep, shelter).
  - Social needs (e.g., belonging, connection).
  - Demands are backed by buying power (money, credit, etc.). It's the ability to get what you want.
Market Offerings: Refer to the benefits that customers receive from a company's product or service offerings.
Customer Value and Satisfaction:
- Customer Value is calculated as Benefits vs. Costs.
  - Benefits can be subjective and include factors like color, design, brand, functionality, etc.
  - Costs encompass the price and sacrifices made.
  - Customer value can be subjective. For example, some people are willing to pay more for a specific color or size of an iPhone, highlighting the importance of customer satisfaction.
- Customer Satisfaction is measured by comparing Actual product performance vs. Expected performance.
  - If the actual value meets or exceeds expectations, customers are happy. Conversely, if it falls short, they may feel the value isn't enough.
Exchanges and Relationships:
- Marketing focuses on building mutually beneficial relationships with stakeholders, particularly customers. It involves understanding their needs and responding accordingly.
Markets:
- Markets are where exchanges and transactions take place.
- Examples of mutually beneficial actions within a market are trading and shopping.

Functions of the Marketing Process

The marketing process describes how companies implement and execute marketing strategies.
This process involves understanding customer needs and wants, implementing policies and procedures, and achieving business objectives.

Marketing Process Steps

1. Understanding Needs and Wants:
- This involves using marketing information systems, understanding consumer behavior (week 2 topic), and conducting environmental scans (week 3 topic).
2. Designing a Consumer-Driven Marketing Strategy:
- This step involves segmentation, targeting, differentiation, and positioning.
3. Constructing a Marketing Program that Delivers Superior Value:
- This involves defining the company's strategy for communicating with consumers and delivering value.
- It emphasizes an integrated marketing program.
- The four fundamental marketing mix elements are:
  - Product: the actual good or service provided.
  - Price: cost of the product or service.
  - Place: distribution channels and accessibility of the product.
  - Promotion: marketing communications used to attract customers.
- Additional elements include people, process, and physical evidence:
  - People: Interactions with the company and its staff.
  - Process: How the product/service is delivered.
  - Physical evidence: Tangible aspects of the brand or experience.
4. Building Profitable Relationships:
- This focus on establishing long-term connections with customers.
5. Capturing Value from Customers:
- This last step involves maximizing the value received from customers.

Marketing Process Elements Examples

It is not appropriate to sell a 400computerina7−Elevenretailstore.However,it′smoresuitabletosellaniPadpricedat400 computer in a 7-Eleven retail store. However, it's more suitable to sell an iPad priced at 400computerina7−Elevenretailstore.However,it′smoresuitabletosellaniPadpricedat4000 in an Apple store because all marketing mix elements (product, price, place, promotion) are aligned and make sense within the context.