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MKT 702 (34)
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Chapter 1

MKT 702 - Chapter 1 Notes.docx

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Ryerson University
MKT 702
John Peco

Chapter 1 MKT-702 Notes The Scope of Marketing Marketing: is about identifying and meeting human and social needs. “Meeting customer needs profitably” AMA Definition: Marketing is the activity, set of institutions, and processes for creating, communicating, delivering and exchanging offerings that have value for customers, clients, partners and society at large Marketing Management: The art and science of choosing target markets and getting, keeping, and growing customers through creating, delivering and communicating superior customer value What is marketed? Goods – Physical goods comprise the most of countries production and marketing efforts. (Food, cars, televisions, machines) Services – Canadian economy produces 72:28 services-to-goods mix. Services include airlines, hotels, barbers, bankers, lawyers, engineers etc. Events – Promotion of time-based events such as Olympics, sporting events, concerts etc Experiences – Orchestrating several services and goods, a firm can create a marketing experience. Amusement parks, hockey camps, customized experiences such as a climb up mount Everest Persons – Artists, CEOs, physicians all get help from celebrity marketers. People can essentially become brands such as Oprah and the David Beckham Places – Cities, regions, and whole nations compete for tourism, residents, factories and headquarters. Place marketers include economic development specialists, real estate agents, and advertising and public relations agencies. Properties – Properties are intangible rights of ownership for real estate property or financial property (stocks or bonds). These exchanges require marketing. Organizations – Organizations build strong, favourable and unique images in the minds of target publics. Universities, museums, performing arts orgs, use marketing to boost public image and compete for audience and funding. Information – The production, packaging and distribution of information are major industries. Information is essentially what books, schools, and universities produce, market and distribute at a price to parents, students and the general public. Ideas – Every market offering includes a basic idea. “The factory produces cosmetics, the drug-store sells hope” Chapter 1 MKT-702 Notes Who Markets Marketer – Someone who seeks a response, attention, a purchase, a vote, a donation from another party know is known as the prospect. 1. Negative demand – consumers dislike the product and may even pay to avoid it 2. Nonexistent demand – consumers may be unaware of or uninterested in the product 3. Latent demand – consumers may share a strong need that cannot be satisfied by an existing product 4. Declining demand- consumers begin to buy the product less frequently or not at all 5. Irregular demand – consumers purchases vary on a seasons, monthly, weekly, daily or even hourly basis 6. Full demand- Consumers are adequately buying all products put in the marketplace 7. Overall demand- More consumers would buy the product than can be satisfied 8. Unwholesome demand – Consumers may be attracted to products that have undesirable social consequences Figure 1.1 Key Customer Markets Consumer Markets – Companies selling mass consumer goods and services such as juices, cosmetics, athletic shoes, and air travel. A large effort establishing brand image by developing a superior product and packaging and ensuring its availability. Business Markets – Business buyers buy goods to make or resell a product to others as a profit. Business markets must demonstrate how their product will help achieve higher revenue or lower costs. Advertising plays a lesser role than sales force, price, and reputation Global Markets – Companies in global marketplace must decide which countries to enter: How to enter each country (exporter, licensor, joint venture partner). How to price products in each country and design communications for different cultures. Non-profit and governmental markets – Companies selling to non-profit orgs with limiting purchasing power such as churches, universities, government agencies, need to price carefully. Lower selling prices affect the features and quality the seller can build into the offering. Meta –Market: Describes the cluster of complementary products and services closely related in the minds of consumers, but spread across a diverse set of industries. The result of marketers packaging a system that simplifies carrying out these related product-service activities. Core Marketing Concepts Marketers do not create needs but influence wants. Five types of needs: Chapter 1 MKT-702 Notes 1. Stated needs ( the customer wants an inexpensive car) 2. Real needs ( the customer wants a car whose operating costs, not initial price is low) 3. Unstated needs ( The customer expects good/services from the dealer) 4. Delight needs ( The customer would like the dealer to include an onboard GPS navigation system) 5. Secret needs ( The customer wants friends to see him or her as a savvy customer) Offerings and Brands Value proposition – Companies address needs by putting forth value proposition, a set of benefits that satisfy needs. The intangible value proposition is made physical by offering, which can be a combination or products, services, information and experiencies Brand – Offering from a known source. A brand name carries association into people’s minds that make up an image. Companies strive to build brand image that is favourable and unique. Value – Value is the sum of tangible and intangible benefits with relation to cost. A combination of quality, service and price. Satisfaction – Reflects a person’s judgement of a products perceived performance in relation to expectations. Marketing Channels – Communication channels deliver and receive messages from target buyers. Newspapers, magazines, radio, television, internet etc. Distribution channel – Channel to display, sell, or deliver the physical product or service. May be direct with internet, phone or indirect with retailers, wholesalers etc. Service channels – Warehouses, transportation companies, banks to carry out transactions. Supply Chain – A longer channel stretching from raw materials to components to finished products carried to buyers. Competition – Includes all rivals and potential rival offerings (substitutes). Task environment- includes the actors engaged in producing, distributing, and promoting the offering. These are the company, supplier, dealers and target cusomters. Supplier group are material suppliers, service supplies ( banking, ad agencies, insurance firms) Distributers are agents, brokers, manufacturing representatives. Broad Environment – Consists of demographic , economic, social-cultural, natural, technological and political-legal environments. New Marketing Realities Chapter 1 MKT-702 Notes Network information technology- The digital revolution has created an Information Age that promises to lead to more accurate levels of production, more targeted communications, and more relevant pricing. Globalization - Technological advances in transportation, shipping, and communication have made it easier for companies to market in, and consumers to buy in, almost any country in the world. Deregulation - Ma
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