Applied Marketing Lesson 1 PDF

Applied Marketing Lesson 1 Today's Lesson: Definition and Concept of Marketing Marketing Environment Consumer Market Business Market  By the end of this lesson... Students will be able to review the definition of marketing and emphasize the importance of market environm...

Applied Marketing Lesson 1 Today's Lesson: Definition and Concept of Marketing Marketing Environment Consumer Market Business Market  By the end of this lesson... Students will be able to review the definition of marketing and emphasize the importance of market environments, and distinction between consumer and business markets.  What is Marketing? Marketing is a social and managerial process by which individuals and groups obtain what they need and want through creating and exchanging products and value with other” According to Kotler and Armstrong, "Marketing is the process by which companies create value for customers and build strong customer relationships in order to capture value from customers in return. Kotler also defined marketing as "The science and art of exploring, creating, and delivering value to satisfy the needs of a target market at a profit." Marketing Concept The marketing concept is when a business makes plans and puts them into action to make the most money possible by increasing sales, meeting customer needs, and beating competitors. The goal is to come up with a plan that works for both the customer and the business. The essence behind the marketing concept is to forecast and meet the desires and needs of clients more effectively than competitors.  To fully appreciate the marketing concept, first, we to understand needs, wants, and demands; 1. Needs - needs are things that satisfy the basic requirement. 2. Wants - Wants are requests directed to specific types of items. 3. Demands - Demands are requests for specific products that the buyer is willing to and able to pay for.  1.PRODUCTION CONCEPT "Consumers will favor availability and extremely affordable products." Since people are unwilling to pay high prices, the goal behind the product is to produce goods at a lower cost. If a company adopts this concept, it will strive for maximum efficiency in its manufacturing processes in order to cut down on production expenses. EXAMPLE OF PRODUCTION CONCEPT The Ford Company’s Car Model T is another example of this production concept. With mass production, he was able to sell this model car for between $260 to $850. At that time Ford had sold this car to many customers and earned a profit. And, we can say that this is evidence of how this production concept of marketing was successful back then. EXAMPLE OF PRODUCTION CONCEPT China possesses a substantial volume of readily available physical labor. As a result, China has been using a lot of human labor to produce a lot of stuff and ship it all over the world. By doing so, they have expanded national output and joined the ranks of the world's top exporters. 2. PRODUCT CONCEPT "The product concept holds that consumers will favor products that offer the most quality, performance, and innovative features" As product concept mainly focuses on product quality, performance, and features. Organizations that adopt this concept believe that very little effort is required to sell good- quality products that are reasonably priced. They concentrate on designing long-lasting products and providing longer warranty times. EXAMPLE OF PRODUCT CONCEPT  3. SELLING CONCEPT The selling concept holds the idea- “consumers will not buy enough of the firm’s products unless it undertakes a large-scale selling and promotion effort.” Instead of concentrating on developing lasting, mutually beneficial connections with their customers, the company here prioritizes producing sales. This means that it is important to sell what the company produces than to produce what customers want. EXAMPLE OF SELLING CONCEPT 4. MARKETING CONCEPT The marketing concept holds- “achieving organizational goals depends on knowing the needs and wants of target markets and delivering the desired satisfactions better than competitors do.” A "customer first" philosophy is used by the marketing management in this case. According to the marketing theory, success in terms of sales and profits can be attained by focusing on customer. 5. SOCIETAL MARKETING CONCEPT The societal marketing concept holds that “marketing strategy should deliver value to customers in a way that maintains or improves both the consumer’s and society’s well-being.” The Societal Marketing Concept puts human welfare on top before profits and satisfying the wants. "One of the best example people applying this concept is SOCIAL ENTREPRENEUR" Mijeno realized that the Philippines have an abundance of saltwater, which allowed her to create a lamp powered by the saltwater surrounding the Philippines or through a glass of water and two scoops of salt.  MARKETING ENVIRONMENT: MICRO AND MACRO ENVIRONMENTS  Marketing Environment Actors and forces that affects a firm’s ability to build and maintain successful relationships with customers. A marketing environment encompasses all the internal and external factors that drive and influence an organization's marketing activities. Marketing managers must stay aware of the marketing environment to maintain success and tackle any threats or opportunities that may affect their work. There are two significant types of marketing environments: 1.Internal marketing environments 2.External marketing environments Internal Marketing Environment Internal marketing environments are made up of variables that are under your control and have an impact on your marketing operations, such as your organization's strengths, weaknesses, uniqueness, and competencies.  External Marketing Environment The external marketing environment includes all factors that do not fall within your organization's control, including technological advancements, regulatory changes, social, economic, and competitive forces. These factors may be controllable or uncontrollable, but defining and studying their changes and trends gives your business and marketing team some power to stay the course. The external marketing environment can be broadly categorized into micro and macro marketing environments. What is a microenvironment in marketing? In marketing, the microenvironment is inextricably related to your company and has a direct impact on marketing activities. It looks at factors like customers, suppliers, business partners, vendors, and even competitors. To some extent, microenvironmental influences can be controlled. What is a macro marketing environment? Macro marketing environment is made up of all the factors beyond the control of any organization. An easy way to remember these factors is by using the PESTLE acronym, which stands for: P: Political factors E: Economic factors S: Social and demographic factors T: Technological advancement factors L: Legal and regulatory factors E: Environmental factors  CONSUMER MARKET A consumer market is a type of sales market in which a business sells directly to consumers, also known as a business-to-consumer (B2C) market. In a consumer market, consumers usually pay the same price for each product, although they can use coupons or merchant discounts to pay a reduced price. Often, when a business faces increased consumer demand, the business' demand for goods from their own suppliers also increases. Types of consumer markets 1. Food and beverage products 2. Consumer products 3. Transportation products 4. Retail products When making a purchase, consumers in the business-to- consumer market typically consider only a handful of factors such peer pressure, personal preference, marketing efforts, and macroeconomic conditions. When trying to reach a specific demographic of customers, any companies first do market research to identify the following traits among those customers such as: Geographical characteristics: These include the size of the market, the climate, and the population density of various customer regions. Demographics: These factors include the clients' gender, age, occupation, income, level of education, and ethnicity. Behavioral traits: These include the types of customers— light, medium, and heavy users—as well as the frequency of customer recurrence.  BUSINESS MARKET A Business Market is a way for a company to sell goods or services to a certain group of customers. Usually, business markets help businesses sell to each other when one business wants to use or sell the goods or services of another business.  Five types of business markets 1. B2B - Companies that use B2B advertise and sell their goods or services to other businesses instead of marketing directly to consumers. 2. B2C - A business-to-consumer market involves businesses advertising products directly to customers for purchase. 3. Industrial market - If a business sells products or services used in industrial or production projects, it likely operates in an industrial market. Most companies that use an industrial market advertise and sell their goods and services to other companies rather than immediately to consumers. 4. Services market - A services market refers to when a business advertises and sells services instead of products 5. Professional services market - A professional services market facilitates the advertising and sale of services from specialized professions.  Assignment #1 1. Define marketing using your own words. 2. Differentiate between selling concept and marketing concept. 3. How does the consumer market differ from the business market? 4. If you will establish a business, what marketing concept will you use? Explain why.