Marketing - Chapter 1
A set of business practices designed to plan for and present an organizations products or
Marketing is about planning, and the effective execution of that objective planning
towards a goal.
Core Aspects of Marketing
Marketing is about satisfying customer needs and wants - Understanding needs and wants of
customers is fundamental to marketing success
o Need – person feels deprived of basic necessities of life (food, clothing shelter)
o Want – the particular way a person chooses to fulfil his need which is shaped by
the persons knowledge, culture and personality
Market – group of people to whom an organization is interested in marketing its
products, services or ides too. All consumers who need or want the firm’s product and
have the ability and willingness to buy it.
Target Market – The segment of the market whom which the firm is trying to attract by
building products and marketing strategies aimed to suit that specific group.
Marketing Entails Value Exchange: The trade of things of value between the buyer and the seller so that
each is better off.
Sellers provide goods or services, then communicate and facilitate their offering to
consumers who complete the exchange buy giving money and information to the seller.
The information can be used to inform that consumer of other items that they might
purchase now or in the future (I-tunes account, sends updates about products etc.)
Marketing Requires 4 P’s: Or “The marketing mix” Together the 4 P’s comprise the marketing mix which
is the controllable set of activities that the firm uses to respond to the wants of its target market.
Product (creating value): Marketing creates value by developing a variety of offerings to
satisfy customer needs.
o Goods: Items you can physically touch (Ipod, clothing etc.)
o Services: Intangible customer benefits that are produced by people or machines
and cannot be separated from the producer (Air travel, banking, insurance etc.)
o Ideas: Thoughts or opinions, philosophies and intellectual concepts that can also
be marketed (Lecture series etc.)
Price (transacting value): Price is everything the buyer gives up – money, time, energy –
in exchange for the product.
o Marketers must determine the price of a product carefully on the basis of the
potential buyer’s belief about its value.
o Key to determining prices is figuring out how much customers are willing to pay
so that they are satisfied with the purchase and the seller achieves a reasonable
profit. Place (delivering value): All of the activities necessary to get the product from the
manufacturer or producer to the right customer. Developing an efficient system for
merchandise to be distributed in the right quantities, to the right locations, and at the
right time in the most efficient way in order to minimize system wide costs while
satisfying the service levels required by their customers
Promotion (Communicating value): Promotion is communication by a marketer that
informs, persuades and reminds potential buyers about a product or service to influence
their opinions or elicit a response. Promotions generally enhance value.
Marketing is shaped by forces and players external to the Firm: Company’s marketing activities are
influenced not only by factors within the company but also by forces, organizations and individuals
external to the company.
External forces such as social, technological, economic, competitive, and regulatory
changes shape a company’s marketing activities.
Current trends towards healthy eating and environmentally friendly products have led
marketers to use environmentally friendly packaging, and to distinguish their products
by using labels such as “low-fat” or “environmentally friendly”
Marketing Can Be Performed by both Individuals and Organizations:
B2C (Business-to-Consumer)- process in which business sell to consumers
B2B (Business –to-Business) – process of selling merchandise or services from one
business to another
C2C (Consumer– to-Consumer) The process in which consumers sell to other consumers
Marketing Occurs in Many Settings: Marketing occurs in both for-profit and not for-profit sectors
University’s etc. use marketing to influence potential students
Hospitals, theatres, charities, politicians, religious institutions and governments all use
marketing to communicate their messages to their constituents.
Marketing helps Create Value
Production-Oriented Era: Around turn of 20 century, firms were production oriented
and believed that a good product would sell itself. Manufactures were concerned with
product innovation, not with satisfying the needs of individual customers.
Sales-Oriented Area: 1920-1950, production techniques became more sophisticated
and company’s were producing more goods then they could sell. They depended on
heavy doses of personal selling and advertising. Marketing essentially reduced to selling
function in which they try to sell as many of their goods as possible instead of focusing
on products people actually wanted. Market-Oriented Era: After WW2, soldiers returned, got jobs and people began
shopping for items that might have been in limited supply during the war. Shopping
centers began to pop up and it became a buyers market. Consumers had