MKTG1203 Lecture Notes - Lecture 1: Critical Thinking, Carlton Draught, Customer Engagement
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MARKETING MANAGEMENT
1st March 2016
Chapter 1: Introduction to Marketing
CORE MARKETING CONCEPTS
•Needs, wants and demand
•Product Offering
•Value, satisfaction and equality
•Exchange, transactions, and relationships
•Markets
There is a cyclical relationship occurring between these concepts
Marketing: the activity, set of institutions, and processes for creating,
communicating, delivering and exchanging offerings that have value
for customers, clients, partners and society at large.
Co- creation: the process whereby consumer experiences are used to
drive organisation improvement and change, resulting in enhanced market performance drivers for the firm
(loyalty, relationships, customer word of mouth)
Marketing process: a process that involves understanding the market to create, communicate and deliver
an offering for exchange
•on going cycle, started by understanding consumers, the market and how they are currently situated.
This may be done by conducting market research
•analysis and assessment of the marketing environment and markets as well as consumer and business
buying behaviour
Exchange: the mutually beneficial transfer of offerings of value between the buyer and seller
•two or more parties must participate, each with something of value desired by the other party
•all parties must benefit from the transaction
•the exchange must meet both parties’ expectations (e.g. quality and price)
Market: is a group of customers with different needs and wants
•customers are those who purchase products for their own or someone else’s use, while consumers are
people who use the good or service.
•clients are customers of the not-for-profit organisations or social marketers
•partners are organisations or individuals who are involves in the activities and processes for creating,
communicating and delivering offerings for exchange.
Ethics: refers to a set of moral principals that guide attitudes and behaviour. It is doing what is right.
•governed by law
•laws represent society attempt to ensure individuals and organisations act in a way that the society
deems beneficial or at least acceptable
Corporate Social Responsibility: businesses have an obligation to act in the interests of the societies that
sustain them
Stakeholders: individuals, organisations and other groups that have
a rightful interest in the activities of a business
Triple bottom line: comprised of social, environmental and profit
considerations ——>
Sustainable development: development that meets the needs of
the present without comprising the ability of the future generations to
meet their own needs
•reduction in consumption (purchasing less), changing purchasing,
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downsizing the products consumers, the reuse of materials and the marketing of greener products
MARKETING MIX:
•describes elements that marketers need to consider
•a product is a bundle of attributes that when exchanged have value for customers, clients or society. A
product can be a good, service or idea. Products cater to needs and wants. Needs are day to day
survival requirements, while wants are desired but not required for survival.
•price is the amount of money a business demands in exchange for its offerings. Pricing is influenced by
marketing factors such as: production, communication and distribution costs, profitability, partners
requirements etc
•distribution or place refer to means of making the offering available to the target market at the right time
and place while managing the cost of making the products available.
•Promotion is the marketing activities that make potential customers, partners and society aware of and
attracted to the benefits of a businesses’ products. This product might be already established, modified,
new or information designed to persuade. Promotional activities include advertising, direct selling, sales
promotions and loyalty schemes.
•People refers to all the people that may come into contact with the customer and affect their experience
of the product, they must be able to maximise value for the customer
•Process refers to the systems used to create, communicate, deliver and exchange and offering
•Physical Evidence refers to the tangible cues and physical environment a marketer can provide to help
potential customers evaluate service quality.
HOW MARKETING IMPROVES BUSINESS PERFORMANCE, BENEFITS SOCIETY AND CONTRIBUTES TO
QUALITY OF LIFE
•organisations with a market orientation perform better then those who don't
•marketing creates employment and wealth for the benefit of individuals and society as a whole
•improves quality of life through better products and the promotion of consumer and social welfare.
•understanding marketing helps you to make better decisions as to the relative value of products offered
to you
CUSTOMER NEEDS
Firms provide benefits that are linked to the needs and wants of consumers. Needs are linked to survival
and wants are linked to desires. Satisfaction, purchase intention, and loyalty as consumers are driven by
the type of benefits that organisations provide on the first and on going instance, the quality and value of
those (and how they are communicated and offered) and the perceptual in nature (relative to what the other
companies are offering.
Benefits can include the very functional product benefits (e.g. education, career) and more advanced
benefits (e.g. social), like the benefits provided by brand image. Sometimes the impact of the brand image
is a major benefit for consumers that not only directly impact purchase intention of an offering but also
impacts consumer perceptions of quality and value of the product.
Value: overall assessment of the utility of an offering based on perceptions of what is received and what is
given.
•what you believe the product is worth, how much you appreciate it
•ration between benefits and money spent (benefits-costs)
•ratio between quality and price
Satisfaction: the extent to which a products perceived performance matches a buyers expectations.
•firms have to manage expectations to avoid disappointing customers
Quality: engineering term related to if the product is free from defects
•product performance and functionality
•consistent delivery
•perception of standard, relative to what is also being offered.
BRAND IMAGE
Brand Image: is the set of beliefs that a consumer has regarding a brand.
•sum of all association a brand has. This may be attributes, benefits, values and personality
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In certain consumption settings, a brands personality may be the main brand image.
VALUE
Value might comprise of an emotional utility, a social utility, as well as a specific utility with regard to how
the offering performs relative to cost and quality. Other values might include societal value and engagement
values
Chapter 2: The Marketing Environment
Marketing Environment: the internal and external forces
that affect a marketers ability to create, communicate,
deliver and exchange offerings of value.
•it is divided into the
internal
environment, micro
environment,
macro environment
Internal Environment: refers to the parts of the organisation, the
people and the processes used to create, communicate, deliver and
exchange offerings that have value.
•controlled directly by the organisation
•shows the organisations strengths and weaknesses, which
positively affect the organisations ability to compete in a
marketplace
•examples: senior management, middle management, functional
departments, employees, external vendors
INTERNAL MARKETING
Internal Marketing: is a cultural framework and a process to achieve
strategic alignment between front-line employees and marketing.
•collection of activities, processes and policies that treat employees as members of an internal market
who need to be informed, educated, developed and motivated to serve customers more effectively.
•this is done in three ways: managing internal communications, use of market research, making sure all
members understand they role
External Environment: things that are outside the organisation. Involves people and processes that the
organisation cannot directly control.
•marketers seek to influence the external environment e.g. lobbying governments
Micro Environment: consists of consumers, clients, partners and competitors. It is not directly controlled
by the organisation
•Can have some influence on the microenvironment though
•affect the marketer
CUSTOMERS
•need to understand what their customers value now, and identify changes in customer preferences. They
need to be willing and able to change and need to be able to anticipate how those needs and wants
might change in the future
PARTNERS
•logistics, fianaciers, advertising agencies, retailers, wholesalers, suppliers
•there are also risks involved with being in a partnership due to a balance of powers
SUPPLIERS
•need to know their suppliers costs, availability, time frames and planned innovations to determine how
best to create value.
•need to be able to manage the risks and be aware of any pre-empt problems and resolve them to fulfil
their demand
Document Summary
Core marketing concepts: needs, wants and demand, product offering, value, satisfaction and equality, exchange, transactions, and relationships, markets. There is a cyclical relationship occurring between these concepts. Marketing: the activity, set of institutions, and processes for creating, communicating, delivering and exchanging offerings that have value for customers, clients, partners and society at large. Co- creation: the process whereby consumer experiences are used to drive organisation improvement and change, resulting in enhanced market performance drivers for the rm (loyalty, relationships, customer word of mouth) Marketing process: a process that involves understanding the market to create, communicate and deliver an offering for exchange: on going cycle, started by understanding consumers, the market and how they are currently situated. This may be done by conducting market research: analysis and assessment of the marketing environment and markets as well as consumer and business buying behaviour. Ethics: refers to a set of moral principals that guide attitudes and behaviour.
