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Chapter 22 .docx

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University of Calgary
Management Studies
MGST 391
Ahmad Ali Sohrabi

Chapter 22 : The evolution of marketing concept “the right product or service to the right customer, at the right price, at the right time and right place” Marketing Department: Functions (Research, Demand, Design, Selling) Marketing Environment: PESTEL (Political, Economical, Social, Technological, Ecological, Legal) Chapter 1- Introduction Marketing, : Managerial definition: Managing profitable customer relationships, by delivering superior value to customers. Social definition: ―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.‖ Core Marketing concepts: Market: A market is the set of actual and potential buyers of a product. Needs, wants and demands: Needs  are fulfilled : a state of felt deprivation. Wants  are satisfied : the form taken by a human need as shaped by culture and individual personality. Demands  are extinguished : Human wants that are backed by buying power. Marketing Offer: Combination of good-service offered to market to satisfy need or want. Value and Satisfaction Customer’s perceived value is the difference between the values that the customer gains from owning and using a product and the costs of obtaining the product. Satisfaction is whether performance meets or exceeds expectations. Exchange, Transaction and relationship: Exchange is an act of obtaining a desired object from someone by offering something in return. Transaction is a trade of value between two parties. Elements of Marketing: Company Supplier Market Intermediaries End user Competitors ENVIORNMENT Customer’s life time value: Value of entire stream of purchases by customer over his lifetime. Customer Equity: Total lifetime value of all of company‘s customers. Marketing Management: Marketing management has four functions: Analysis, Planning, Implementation and control. Demarketing’s aim is to reduce demand temporarily or permanently. It is done when product is not feasible from supplier or customers‘ point of view. i.e intentional and non-intentional reduction in demand. Marketing Management Orientations The production concept holds that consumers will favor products that are available and highly affordable and that management should, therefore, focus on improving production and distribution efficiency. The product concept states that consumers will favor products that offer the most quality, performance, and features, and that the organization should, therefore, devote its energy to making continuous product improvements. The selling concept is the idea that consumers will not buy enough of the organization‘s products unless the organization undertakes a large-scale selling and promotion effort. The marketing concept holds that achieving organizational goals depends on determining the needs and wants of target markets and delivering the desired satisfactions more effectively and efficiently than competitors do. The societal marketing concept holds that the organization should determine the needs, wants, and interests of target markets. It should then deliver the desired satisfactions more effectively and efficiently than competitors in a way that maintains or improves the consumer‘s and the society‘s well-being. CONCEPT CUSTOMER WANTS COMPANY SHOULD Production concept Availability and affordability Improve production, distribution efforts Product concept Quality, performance, features Continues product improvement Selling concept No feelings to purchase Large scale selling, promotion Marketing concept Needs & wants of target market Effective & efficient than competitor Two Steps of marketing:  Determine Need, Wants And Interest Of Target Market  Then Satisfy Them Effectively And Efficiently Marketing Vs. Selling: Starting point Focus Means Ends Selling concept Factory Existing products How to increase Profits through sales volume demand Marketing concept Market Customer needs How to satisfy Profits through customer demand satisfaction Despite adoption of market oriented approach; there is need for sales force:  To create awareness  To convince to buy from company, not from competitors  To reassess benefits to customers  To convince that average customers‘ requirements are met Problems in introducing the marketing approach:  Understand what marketing orientation actually means  Organizational, structural and cultural changes are required.  Assessment of Product, logistic, level of services and marketing techniques  Organization wide dedication  Working together as whole Types of Marketing Strategic Marketing Tactical Marketing Tied with corporate strategy Short term, and focuses Scope of Marketing = Marketing Planning e.g which product of market to choose on place, promotion, Marketing Vs. R&D department: price Marketing has commercial and competitive atmosphere whereas R&D has University atmosphere with open-end work and consumption of substantial resources. Customers‘ needs and change in product specification tighten them. Consumerism is a term describing importance and power of consumers. Customer Database Customer Relationship Management: Customer Portfolio Defined narrowly as a customer database management activity. ―CRM is managing detailed information about individual customers and carefully managing customer touch points to maximize customer loyalty‖. Companies look for touch points. These includes customer purchases, sales force contact, service, and support calls, Web site visits, satisfaction surveys, credit and payment interactions, market research studies, etc. To be effective in CRM, the marketer must forego short-term profit maximization on individual transactions. Elements of Marketing Mix: How to Get Customer Touch Points: - Purchasing trend Controllable: - Payment trend  Product - Service obtaining trend - Family trend  Price - History - Support calls -
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