chapter 1

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University of Toronto Scarborough
Management (MGM)
Ingrid L.Stefanovic

Tuesday, September-15-09 Principles of Marketing Chapter 1 INTRODUCTION Marketers are increasingly forming a sort of relationship with their customers based on information gleaned from extensive databases o Example: retailers track your shopping history Marketing is more than just advertising and selling Marketing is all about matching producers output to customers activities Idea of matching producers output to customers activities sounds less complicated than it really is o There are many product and company failures The cause of poor marketing is usually a lack of focus on customers Marketing is the business function that interprets customer needs to the rest of the organization and brings the resulting offerings of the firm to the customer Consumer perceptions, attitudes, time constraints, space, lack of information and location are all things that contribute to the gap between producers and consumers o There is a bridge that marketing must build to close the gap, and it is built through the eight marketing functions Buying Selling Transporting Storing Grading Financing Risk taking Information collecting Disseminating o A reduction in the gap implies an increase in the utility consumers associate with a product or service The result is that consumers are more likely to enter into an exchange relationship with the marketing organization MARKETING IS ABOUT EXCHANGE Exchange process is when two or more parties give something of value to one another to satisfy felt needs. o Item is usually tangible Example: newspaper o However, there are cases where there are intangible services Example: concert performance Specialization and division of labour will lead to a production surplus o Example: George is a good weaver, bad farmer. Elaine is a good farmer, bad weaver. It is beneficial for both to specialize in each others line of work to increase production
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