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Chapter 1

Marketing Chapter 1 Notes.docx

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McMaster University

Lecture 2: Marketing Chapter 1 Video 1: Hamilton, Ontario, Canada, the ambitious city -Hamilton, advertising the city Video 2: CES Consumer Electronic Show in Las Vegas -2 main products that are going to be showcased this year include: -Samsung the 4K, 4 times the pixel -Cars that drive themselves Marketing -Marketing provides utility in 4 different forms -Form: the way something is made, the CES displays form utility because the producers are interested in the way the products are made -Time: time utility is provided when the good or services provided are available when the customer wants them -Place: goods and services provide utility by being available where the customers want them -Ownership: goods and services provide ownership utility when the ownership of the good is transferred from the owner to the customer through the exchange of currency (such as through the exchange of credit, cash or debit) -marketers have to be able to make sure that all 4 forms of utility when they are trying to advertise their goods/services in order to provide satisfaction to the customers -Different activities that the marketers must do in order to create customers: -Identifying the needs of the customers -Designing the products to satisfy the needs of the customers -Communicating information -Availability; making the products available to the customers when they want them -Pricing the goods and services -Follow-up: providing service and follow-up -Marketing is a function and a set of process (many steps are involved for marketing to happen) -involves creating, communicating, delivering value to customers -managing customer relationships in ways that will benefit the organization and the stakeholders -usually comprises of 2 steps, with the first being able to create and deliver goods of value to the customers and the second being creating and maintaining a good relationship between the customer and the business (or different people in the vertical chain) -Marketing is considered to be both an art and science -Science: when laws are involved and everything can be explained -Art: involves creativity and cannot be explained -marketing is a science because the psychological needs of the customers are known (the way the customers react to certain things), but one needs creativity in order to think of a way to market the goods, thinking outside of the box is required -4 different eras of marketing: production, sales, marketing, relationship Production Era -bartering system was in place; there was no form of currency involved, goods were traded for goods -focus on the quality of the good, there was the belief that a good quality product will sell itself -there were more consumers than sellers at this point -took place before 1920 Sales Era -there was the belief that the customers would only buy out of necessity, would not purchase non-essential items -If one person had a good method of advertising, then they would be able to convince a person to buy an item that was unnecessary -this era was during the Great Depression; hence the people’s focus on savings and spending only for necessity Marketing Era -shift from a seller’s market to a buyer’s market -focus on the long run of the company in order to be successful -1950-1990 era Relationship Era -developing long-term, value-added relationships over time with customers and suppliers -the creation of strategic alliances and partnerships began to become popular and were beneficial to everyone -the focus is more than just about selling, but maintaining a good relationship with the customers or the producers -one example is for companies to create cards which entices the customer to return, because there are many stores with similar products/services so businesses must make themselves unique or create perks (cards) to attract customer to do business at their store Transaction Based Marketing: -this is where this is little communication between the two parties; the customer comes in to buy goods and the businesses make money, very simple -there is little or no ongoing relationship between the two parties Relationship Marketing: -this is when a relationship is built by both parties and this helps to add value to the relationship Transaction-Based Marketing to Relationship Marketing: Ladder - New Customer Regular  Loyal Supporter  Advocate -when there is a new customer, if you take the time to treat them well or offer a card, they will turn into a regular customer, then a loyal supporter and eventually an advocate of the company -Strategic Alliances: -includes B2B relationships with the suppliers, distributors -vertical alliance: having a relationship with the different people in the supply chain (producer manufacturer etc.) Marketing Myopia -Myopia: referrers to close sightedness -Marketing myopia is when the business looks into the present and not towards the future -To avoid marketing myopia, one must be able to think about the future and one method is think about how to keep satisfying the customers and how to keep them happy -Burger King is an example; they used to only sell burgers, but increased their product lines tofries, shakes etc. to not only keep up with their competitors but to also continue to satisfy their customers -Needs and wants can be compared to Maslo’s hierarchy of needs Not-For-Profit Organizations -focus is to generate revenue to suppor
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