chapter 1.pdf

Marketing Management MBA 621 Ataklty Adugna (Asst. Professor ) Marketing Overview Discussion Questions 1. Why is marketing important? 2. What is the scope of marketing? 3. What are some...

Marketing Management MBA 621 Ataklty Adugna (Asst. Professor ) Marketing Overview Discussion Questions 1. Why is marketing important? 2. What is the scope of marketing? 3. What are some fundamental marketing concepts? 4. How has marketing management changed in recent years? 5. What are the tasks necessary for successful marketing management? Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Slide 3 of 25 Introduction The first decade of the 21st century challenged firms to prosper financially and even survive in the face of an unforgiving economic environment. Marketing is playing a key role in addressing those challenges. Finance, operations, accounting, and other business functions won’ t really matter without sufficient demand for products and services so that the firm can make a profit. Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Slide 4 of 25  1.1 Importance of Marketing Marketing’s broader importance extends to society as a whole. Marketing has helped introduce and gain acceptance of new products that have eased or enriched people’s lives. Successful marketing builds demand for products and services, which, in turn creates jobs. By contributing to the bottom line, successful marketing also allows firms to more fully engage in socially responsible activities. Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Slide 5 of 25  Marketing Demand Jobs Revenue Profits Giving Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Slide 6 of 25 1.2 Scope of Marketing To prepare to be a marketer, you need to understand what marketing is, how it works, who does it, and what is marketed. Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Slide 7 of 25  Marketing is the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offers that have value for customers, clients, partners, and society at large. Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Slide 8 of 25  Definition What is Marketing? What does the term marketing mean? Marketing must be understood not in the old sense of making a sale - 'selling' - but in the new sense of satisfying customer needs. Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Slide 9 of 25  “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 others” (Kotler). ▪ To explain this definition, we examine the following important terms: needs, - wants and demands, products; value and satisfaction; exchange, transactions and relationships; and markets. Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Slide 10 of 25 Needs, Wants and Demands Needs: The most basic concept underlying marketing is that of human needs. A human need is a state of felt deprivation. Humans have many complex needs. Wants: Human wants are the form taken by human needs as they are shaped by culture and individual personality. ▪ Wants are described in terms of objects that will satisfy needs. Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Slide 11 of 25  Cont’d Demand: People have narrow, basic needs (e.g. for food or shelter), but almost unlimited wants. However, they also have limited resources. Thus they want to choose products that provide the most satisfaction for their money. When backed by an ability to pay - that is, buying power - wants become demands. Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Slide 12 of 25  Marketing Management is the art and science of choosing target markets and getting, keeping, and growing customers through creating, delivering, and communicating superior customer value. Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Slide 13 of 25  Products and Services People satisfy their needs and wants with products. A product is anything that can be offered to a market to satisfy a need or want. Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Slide 14 of 25  What is Marketed? Persons Experiences Events Properties Organizations Information Ideas Goods Places Services Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Slide 15 of 25 Who markets? Response Attention Purchase Donation Vote Marketer Prospect Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Slide 16 of 25  Types of Demand Unwholesome Declining Nonexistent Latent Irregular Full Negative Overfull Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Slide 17 of 25 Markets Traditionally, a market was a physical place where buyers and sellers gathered to buy and sell goods. However, Economists describe a market as a collection of buyers and sellers who transact over a particular product or product class. Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Slide 18 of 25  Markets In business a market is the set of actual and potential buyers of a product. These buyers share a particular need or want that can be satisfied through exchange. Thus, the size of a market depends on the number of people who exhibit the need, have resources to engage in exchange, and are willing to offer these resources in exchange for what they want. Five basic markets and their connecting flows are shown in the following figure. Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Slide 19 of 25  Markets Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Slide 20 of 25  Simple Marketing System Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Slide 21 of 25  Key Customer Markets Global Markets Consumer Market Business Markets Government Market Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Slide 22 of 25  1.3 Core Marketing Concepts Needs, Wants, and Demands Segmentation, Target Markets and Positioning Offerings and Brands Value and Satisfaction Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Slide 23 of 25 1.4 The New Marketing Realities Globalization Communicate Information with Customer Collect Technology Information Major Societal New Company Forces Capabilities Consumer Differentiate Information Increased Goods Competition Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Slide 24 of 25 Who is Responsible for Marketing? Entire Organization Marketing Department Chief Marketing Officer (CMO) Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Slide 25 of 25 1.5 Company Orientation towards the Market place: Marketing Concepts/Philosophies Quality Create, deliver, and Innovation communicate value Production Product Selling Marketing Holistic Mass production Unsought goods Mass distribution Overcapacity Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Slide 26 of 25  Holistic Marketing Dimensions Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Slide 27 of 25  Relationship Marketing Build long-term relationships with Customers Employees Marketing Partners (Channels, Suppliers, Retailers) Financial Community ( Shareholders, Develop marketing networks Investors, Analysts Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Slide 28 of 25 Integrated Marketing It assembles marketing activities and programs to create, communicate, and deliver customer value. Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Slide 29 of 25  Internal Marketing Is the task of hiring, training, and motivating capable employees who want to serve customers well. Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Slide 30 of 25 Performance Marketing Performance Marketing requires the understanding the financial and nonfinancial returns to business and society from marketing activities and programs. Social Responsibility Financial Accountability Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Slide 31 of 25  1.6 Updating the Four P’s The Four P’s of the Marketing Mix Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Slide 32 of 25  Updating the Four P’s Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Slide 33 of 25  THANK YOU Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Slide 34 of 25