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Lehigh University
MKT 111

What is Marketing? 2/22/2013 10:32:00 AM Marketing  Process by which companies create value for customers and build strong customer relationships and capture value from customers in return  Managing profitable customer relationships Terms  Needs o State of felt deprivation  Wants o Objects that satisfy needs  Shaped by culture and individual personality  Demands o Wants backed by buying power Market Offering  Combo of products and services, information and experiences offered to satisfy need or want Marketing Myopia  Focus on specific product rather than benefits and experience Customer Value  Benefit that the customer gains from product compared to the cost of getting the product Customer Satisfaction  Products perceived performance compared to expectation Market  Buyers who share a need that can be satisfied by a company’s product or service Pyramid  Satisfaction, loyalty, lifetime value Strategies 2/22/2013 10:32:00 AM Strategic Planning  Managerial process of developing and maintaining a strategic fit between the organization’s goals and capabilities and its changing opportunities Steps  Define missions o Statement of organizations function in society that identifies customers, markets, products and technologies  Set objectives and goals o Statement of task or accomplishment  Set strategic directions o Level  Moving down an organization o Offering  Tangible or service  Planning marketing and other functional strategies Mission Statement  Asks… o What is the business? o Who is the customer? o What do the customers value? o What should our business be?  Should be… o Invisible hand o Motivating o Based on distinctive competencies Setting Corporate Objectives and Goals  Goals convert into missions  Measureable means of how well a mission is accomplished o Profit, sales Setting Strategic Direction  BCG Matric o X=market share Y=market growth o X=market share of SBU/market share of leader o Y=sales current-sales last / sales last o Star, question mark, cash cow, dog  Product Market Grid o  SWOT Analysis o Internal  Strengths  What they are doing well that gives them an edge  Weakness  Internal flaw compared to competitors o External  Opportunities  Conditions that have favorable benefits to company  Threats  Pose danger to company  4 Ps o product, price, promotion, place Marketing Environment 2/22/2013 10:32:00 AM Environmental Forces Effect suppliers, organization and customers  Social o Demographic, cultural  Economic o Macroeconomic conditions, consumer income  Technology o Changing tech, impact on value  Competitive o Small business, other competition  Regulatory o Laws, self regulation Environmental Scan  Shows the many trends that influence marketing today Demography  Study of human population in terms of size, density, location, age, gender, race and occupation  “Six Pocket Syndrome” – multicultural marketing o rich Chinese kids  US demographic o Changing age, changing family structure, geographic movement, more education, more ethnic  Types of Demographics o Baby Boomers  1946-1964  28% of population, 50% of income o Generation X 15% of populations  1965-1976 (30s)  grew up in recession and are money conscious o Generation Y  1976-2000  most diverse and most informed Cultural Forces  Culture o Set of values, ideas and attitudes that are shared by members of a same group  Men vs Women o Women don’t remember discrimination so ads are equal now o Less gender distinction  Values o People want control, comfort and change o Want to save environment  Chevy Volt o Value Consciousness  best bank for buck Economic Conditions  Inflation, recession o Consumer Confidence Index  Income o Gross, disposable, discretionary Technology Forces  Cheaper, new development and changing products Consumer Behavior 2/22/2013 10:32:00 AM Consumer Buyer Behavior  Behavior of final consumers – individuals and households who buy goods and services for personal consumption Stimulus Response Model  Market Stimulus o Product, price, placement, promotion  Buyer’s Black Box o Buyers decision process o Buyers characteristics  Buyer’s response o Product choice, brand choice, dealer choice, purchase amount Purchase Decision Process  Recognize a problem o Perceive a need  Information Search o Seek value  Alternative Evaluation o Assessing Value  Purchase Decision o Buying value  Post-purchase Behavior o Value in use o Cognitive dissonance – unsure after purchase Factors Affecting Buying  Culture o Values, perceptions, wants and behaviors learned by a member of society from family and other important institutions o Shifts  Subculture  Groups of people with shared values based on common experience  Social Class  People within a social class tend to exhibit similar buying behavior  Social: Family o Gatekeeper  Controls information flow o Decider  Decides to buy or not o Buyer  Actually buys o User  Actually consumes o Disposer  Stops usage o Influencer  Provides information to others  Social: Reference Groups o Reference groups  People whom an individual looks when forming attitudes about products  Reference Groups  Direct  Primary (coworkers, friends)  Secondary (professional associations)  Indirect  Aspirational (want to be in)  Dissociative (don’t want to be in)  Social: Groups and Social Networks o Word of mouth/buzz marketing  Opinion leaders who influence others o Social network  FB, twitter  Psychological o Motivation  Need that presses enough to cause a person to seek satisfaction                  Psychological: Perception o Process of selecting, organizing and interpreting information o Selective Perception  Selective attention  Attend to me
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