Understanding Marketing: Core Concepts and the 4Ps

What is Marketing?

• Marketing involves creating, communicating, delivering, and exchanging products/services for benefits.
• The purpose of marketing is to provide value to customers, clients, partners, and society.
• Marketing involves understanding customer needs and building long-term relationships, not just selling.
• Four key elements include creating, communicating, delivering, and exchanging value.

Marketing as an Exchange

• Marketing involves the exchange of value.
• For an exchange to happen, there must be at least two parties involved offering something valuable, the ability to communicate and deliver value, and the freedom to accept or reject the offer.
• Forced transactions are not marketing, and both sides must agree.

The 4Ps of Marketing

• The 4Ps, also known as the Marketing Mix, shape a marketing strategy.
• Product refers to what you sell, including goods or services and must satisfy customer needs and includes design, features, quality, and branding.
• Understanding the following helps determine price, how much do customers pay.
• Place refers to where and how the product is available and physical stores, online or distribution channels.
• Products should ensure easy access for customers.
• Promotion refers to how customers learn about the product through advertising, sales, social media, and PR.
• Promotion aims to attract and persuade buyers the mnemonic "P" is a quick way to remember: Product - What?, Price - How much?, Place - Where?, Promotion – How do they know?

Value in Marketing

• Value is what a customer gets minus what they give up.
• Value is the balance between benefits received and costs paid (money + effort + time).
• Value = Benefits received – (Price + Non-financial costs)
• The marketer's goal: ensure customers feel they are getting more than what they give up.
• They should create a positive exchange that satisfies customer needs.
• Value is personal and different customers value different things.

The 4Ps (Marketing Mix) Explained

• The Marketing Mix Includes: Product, Price, Place and and Promotion.
• Product includes Features, Quality, Branding, Packaging, Services and Warranties
• Price relates to Price Strategy and Pricing either Premium, competitive, or discount pricing, and Fixed or flexible.

Place - How Customers Get It

• Includes Channels, Market Coverage, Assortment, Location, Inventory, and Transport.

Promotion – How You Reach Customers

• Sales Promotion, Advertising, Public Relations (PR), and Direct Marketing determine approach.

What is a Product?

• Anything that satisfies a want or need and includes physical goods, services, experiences & events, people & places, organizations and information & ideas

Price in Marketing

• Is the exchange value of a product/service, monetary (money) or non-monetary (loyalty, data, time).
• Price is important because it is a key element of the Marketing Mix (4Ps).
• Also price affects customer perception & demand and Influences profitability & competition.
• Key pricing concepts include: pressure for Cost Reduction, Reference Prices, Price-Quality Inferences and Price Endings.

What is Promotion in Marketing?

• Promotion is communicating the value of an offering to current & potential customers.
• Marketing communications include methods used to inform, persuade, and remind customers about products and brands.
• Create consumer awareness, educate consumers, persuade consumers, and interact with consumers are Goals of promotion. Promotion is connecting with customers, whether to inform, engage, or encourage action.

The Promotional Mix

• Includes different methods for communicating with customers to inform, persuade, and remind them.
• Advertising via paid promotion through channels like TV, radio, print, and digital ads, TV commercials or online banner ads.
• Direct Marketing, communication with potential customers (emails, mail, or phone), promotional emails or catalogs. includes Promotional emails or catalogs.
• Digital/Internet Marketing via online platforms such as websites, social media, and search engines.
• Sales Promotion are short-term incentives to encourage immediate sales, for example discounts or coupons.
• Publicity/Public Relations gaining media attention without paying for it, creates a positive public image by Press releases, media coverage, sponsorships.
• Personal Selling has involves direct, face-to-face communication to persuade customers and salespeople engaging with customers.

Integrated Marketing Communications (IMC)

• IMC involves the coordination of all marketing and promotional activities to communicate effectively with customers.
• Key elements of IMC include:
  • Coordination of Promotional Elements involving aligning promotions, sales, advertising, public and direct marketing to deliver and unified message.
  • Clarity, Consistency, & Maximum Impact so that messages clear and have the greatest impact across all channels. Marketing activities should reflect image, ensuring experience regardless of channel for example using consistent colours, logos across print ads, TV or social media

Place (Distribution) Strategy

• Delivering Offerings.
• It's about ensuring customers know how to use the product and with proper after-sales service.
• Delivering value involves multiple:
  • Supply Chain a process involving manufacturer, wholesaler, retailer and finally the customer.
  • Products are moved smoothly to consumers. -Locations of Stores by choosing of right physical or and online locations for ease of access.
  • Area of Stores is catered for the customer requirements.
  • 4 Supply Chain Management by way of getting the products to customers in good time with and good condition.

Production Ordination

• Focuses on producing large quantities of a product at low cost, assuming customers buy them because of affordability.
• Began in the Industrial Revolution (late 1800s).
• Companies focused on mass production with the introduction of machinery and the concept of economies of scale.
• Henry Ford's Model A was made affordable through his production line innovation.
• During the Production Era (Late 1800s to 1920s) demand companies focused on increasing production because demand was higher than production capacity
• Production orientation focuses on efficient manufacturing with the belief that affordable, widely available products naturally attract customers.
• "If you produce it, they will buy it.".

Selling Orientation

• Selling Orientation is where businesses aggressively sell their products, assuming customers won't buy unless persuaded through strong sales tactics.
• From the Great Depression & WWII (1920's) People had less income and Companies faced high competition.
• Companies have to actively push sales because Inflation & Unemployment, and they pushed their product using sales, promotions and tactics.
• The "Push" Approach focuses on aggressively marketing a product by using Salespeople, promotions and hard selling tactics.
• "If you push it, they will buy." Is the focus rather than demand, drove business growth.

Product Orientation

• Businesses that focuses on product innovation and differentiation to attract customers.
• It became popular during the Post-WWII Era with The Booming Economy, and Surplus of Products with the Rise of Competition.
• The focus is on Innovation and differentiation
• Product strategy rather than sales determine the product direction

Market Orientation

• Businesses focus on understanding customer needs and creating products based on those needs.
• The philosophy and key is to align the product to customer preferences by creating value with customer satisfaction.
• The understanding is that customers will buy the product if company align with their values.

Value Orientation

• Business that focuses on creating long-term value for customers through personalized relationships and one-to-one marketing.
• Philosophy: Deliver greater value beyond just the product (e.g., great service, personal engagement) and to Build strong, long-term customer relationships.
• Focus is on personalized marketing to meet individual customer needs.
• "If you interact with them, they will continue to buy."

Key Aspects of Marketing

• Marketing Helps Create Value
• Marketing is About Satisfying Customer Needs & Wants
• Marketing Always Entails an Exchange Between Parties
• Marketing Requires Marketing Mix Decisions
• Marketing Can Be Performed by Both Companies and Individuals
• Marketing Occurs in Many Situations (Including Non-Profit)

Characteristics of a Strong Mission Statement

• Enduring & Specific – Clear and long-lasting.
• Neither Too Wide nor Too Narrow – Broad enough for growth but focused.
• Environmentally Sensitive – Adapts to market changes.
• Reflects Both Product & Market Orientation – Focuses on products and customer needs.
• The statement is designed based on the businesses comptence.

Strategic Planning

• Allocating business resourses to seize market opportunities.
• Involves Internal Environment Analysis assessing strengths & weaknesses. Includes identifying core competencies that provides a competitive edge.
• External Environment Analysis by identifying opportunities & threats in the market using tools like SWOT analysis. The business musts evalute both internal & external factors affecting the organization when setting goals.

What is a Situation Analysis?

• A key step in strategic planning and why is it important because a It helps companies make informed decisions, Identifies opportunities & threats aligning strategies with the company's strengths & weaknesses.
• Involve the Interal and external envirioment with what the comapn own, and brand reputation. It also require one the microenvironemtn (customers, employeers and internal enviroment etc

What are Marketing Intermediaries?

• Organizations or individuals that help companies market, sell, their products to final buyers by connecting with customers and ensuring product delivery and customer engagement.
• Types include: Resellers, Physical Distribution Firms and Agencies, marketing service

Economic Environment Factors:

• Interest Rates & Inflation: Affect consumer spending.
• Unemployment Level: Impacts buying power.
• Raw Materials Availability: Affects production costs and prices.
• Disposable Income: Influences spending on essential vs. non-essential items.
• Income Distribution - how incone if distributed.

The Sociocultural Environment

• Has influences from values, beliefs and preferences that consumers have based on experiences handed down through generations.
• Cultural values and norms directly influence how products and behaviour which drive culture Understanding subcultures helps businesses target specific niche markets. Aesthetics also play a role in consumers decision making.

Technological Environment

• The impact of discovery and inovations on the marketing of society with these advancement create new opportunities to consumer behaviours.
• Has had an inrecsed rate of changin technology and regulation of ethics and safe use of techology.

What is the Competitive Environment?

• It includes everything that make a business operate, as they effect comptetition.
• Comptietive includes Barriers to Entry.

Types of Competitive Forces

• Includes porter five forces, bargaining power, threat of new entrants and the competitive rivalry.

Variable Costs

• Expenses that change in direct proportion to a business's production and sales volume.
• Example include: Shipping, raw product material.

Fixed Costs

• Costs that remain constant regardless of production or sales levels, examples inlcude rent.

Capital Costs

• Expenses for the long-term assets that are bought or upgraded, and will maintain value over many years.

Operating Costs

• Are the day to expenses a company incurs to keep its business in operation.

SWOT Analysis

• Tool used to analyse and improve the interal and external factors of the product. Includes analysis of Strengths and Weaknesse
• It helps in making decisions and crafting strategies for business growth.
• Opportunity
• Threats

Evaluate the Internal Environment

• First step of Strategic planning by evaluating what the company is doing and understanding what's impacting the business.

Consumer Purchase Decision Process

• Recognize that need or problem
• Look for solution
• Evalutre the solution
• Purchase teh solution
• Determien if the product satisfied the need.