What is Marketing?
1. Marketing: planning and executing the development, pricing, promotion, and
distribution of ideas, goods, and services to create exchanges that satisfy both buyers'
and sellers' objectives.
2. Consumer needs and wants drive marketing.
3. Marketing Concept: the idea that the whole firm is directed toward serving the
present and potential customers at a profit.
oA firm must get to know what the consumers want.
Providing Value and Satisfaction
4. Consumers want to buy the product that would offer the best value.
5. Value: relative comparison of a product's benefits vs. its costs.
oBenefits include function, emotional satisfaction.
oCosts include sales price, buyers time, and emotional cost of purchasing a
•Value= (Benefits) / (Costs)
6. Utility: ability of a product to satisfy a human want or need. (4 kinds of utility)
oTime Utility: offering products when consumers want them.
•Xmas lights in December
oPlace Utility: making a product available where customers can conveniently
•A store opens up a Christmas department.
oOwnership Utility: conveniently transferring ownership from store to
oForm Utility: by making products available in the first place, turning raw
materials into finished ornaments.
Goods, Services, and Ideas
7. Consumer Goods: products purchased by individuals for their personal use.
oEx. Cars, perfume, medicine.
8. Industrial Goods: products purchased by companies to use directly or indirectly to
produce other products.
oEx. Surgical instruments or earth movers.
9. Services: intangible products, such as time, expertise, or an activity that can be
oEx. Insurance companies, airlines, health clinics
10. Marketers also try to promote ideas
oDon’t drink and drive
11. Relationship Marketing: a type of marketing that emphasizes lasting
relationships with customers and suppliers.
oStrong relationships can create customer loyalty and strong economic/social
The Marketing Environment
12. External environment: outside factors that influence marketing programs by
posing opportunities or threats.
o5 environmental factors
oLegislation and laws can greatly influence the
destiny of industries.
oMarketing managers will sometimes influence the
outcomes of new laws.
oValues, beliefs and ideas of society are constantly
oSuccessful marketers will answer to the new
oNew products are constantly replacing old ones.
oDetermine the spending patterns by consumers,
businesses, and governments.
•Influence a company's plan to product offer,
pricing, and promotional strategies.
oMust also monitor economic cycles
•Consumers spend more as economic
conditions improve and spend less during a recession.
oMust be aware of global economy if the company has
oMarketers convince consumers to purchase their
products over the competitors'.
oSubstitute Products: a product that is dissimilar
from those of competitors but that can fulfill the same need.
•Ex. Fitness program vs diet
oBrand Competition: competitive marketing that
appeals to consumer perceptions of similar products.
•Ex. Large accounting firms: KPMG vs. Ernst
oInternational Competition: competitive
marketing of domestic against foreign products.
•Ex. Air Canada vs. Southwest
13. Marketing Mangers: managers responsible for planning and implementing all the
marketing-mix activities that result in the transfer of goods or services to customers.
14. Marketing Plan: a detailed strategy for gearing the marketing mix to meet
consumer needs and wants.
15. Marketing begins when a company identifies a consumer need and develops a
product to meet it.
16. Marketing Mix: the combination of product, pricing, promotion, and distribution
strategies used in marketing a product. (4 P's of Marketing)
17. Look for Opportunities (Uncontrollable 3Cs)
18. Product: a good, service, or idea that satisfies a buyer's needs and demands.
oA challenge because there is always changing technology, consumer needs.
oMust change product constantly to keep up with trends
19. Product Differentiation: the creation of a product or product image that differs
enough from existing products to attract consumers.
20. Price: the part of the marketing mix concerned with choosing the appropriate price
for a product to meet the firm's profit objectives and buyer's purchasing objectives.
oSeller must be able to sell a product to cover a firm's cost of producing and
marketing, but the price must be reasonable so that the consumer doesn’t turn to
21. Place (Distribution): the part of the marketing mix concerned with getting
products from the producer to the buyer, including physical transportation and choice of
22. Promotion: techniques for communicating information about products.
oAdvertising, personal selling, sales promotions, and public relationships.
Target Marketing and Market Segmentation
23. Companies cannot satisfy everyone because people have different tastes, interests,
goals, lifestyles, etc.
24. Target Markets: any group of people who have similar wants and needs and may be
expected to show interest in the same products.
25. Market Segmentation: dividing a market into categories according to traits
customers have in common.
oGeographic Variables: geographic units that may be considered in