MGTA02H3 Chapter Notes - Chapter 5: Relationship Marketing, Customer Relationship Management, Marketing Mix

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31 Oct 2010
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WHAT IS MARKETING?
-marketing: planning and executing the development, pricing, promotion, and distribution of
ideas, goods, and services to create exchanges that satisfy both the buyers’ and sellers’
objectives
-we (consumers) are the key ingrediant that drives marketing. Everyday we express our need for
essentials and wants for leisures.
-marketing concept: the idea that the whole firm is directed toward serving present and
potential customers at a profit. (must follow changes in tastes that occur)
Providing Value and Satisfaction
-consumers buy products that offer the best value when it comes to meeting their needs & wants
-value: relative comparison of a product’s benefits vs. its cost
value = benefits/ cost
-benefits of a high value product are much greater than its costs
-benefits include not just the function of product but the emotional satisfaction
-costs include cost, time, emotional cost
-marketing specializes in making products that add value (than existing products, price
reduction, longer store hours)
-utility: ability of a product to satisfy a human want or need
-time utility: creates products when people want them (xmas ornaments)
-place utility: makes products available where customers can conveniently purchase them
(store opens annual xmas department)
-ownership utility: transferring ownership from store to customer (selling stuff)
-form utility: by making products available - turning raw materials into finished goods
Goods, Services, and Ideas
-consumer goods: products purchased by individuals for their personal use
-firms that sell products for personal consumption = consumer marketing
-industrial goods: products purchased by companies to produce other products
-firms that sell products to other manufacturers = industrial marketing
-services: intangible products such as time, expertise, or some activity that you can purchase
(e.g. service marking - insurance, airlines...)
-marketers also promote ideas (e.g. dont drink and drive tv ads)
-relationship marketing: a type of marketing that emphasizes lasting relationships with
customers and suppliers (e.g. banks offer incentives to encourage longer relationships
The Marketing Environment
-External environment: outside factors that influence marketing programs by posing
opportunities or threats
-political and legal environment: profound effect on business, eg. no cell phone while
driving
-social and cultural environment: changing social values force companies to develop and
promote new products for both individual consumers and industrial consumers
-technological environment: new technology forces new goods and making others obselete
-economic environment: econ. conditions determines spending patterns -> influence
marketing
MGTA04 Chapter 5
1
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Document Summary

Marketing: planning and executing the development, pricing, promotion, and distribution of ideas, goods, and services to create exchanges that satisfy both the buyers" and sellers" objectives. We (consumers) are the key ingrediant that drives marketing. Everyday we express our need for essentials and wants for leisures. Marketing concept: the idea that the whole rm is directed toward serving present and potential customers at a pro t. (must follow changes in tastes that occur) Consumers buy products that offer the best value when it comes to meeting their needs & wants. Value: relative comparison of a product"s bene ts vs. its cost value = bene ts/ cost. Bene ts of a high value product are much greater than its costs. Bene ts include not just the function of product but the emotional satisfaction. Marketing specializes in making products that add value (than existing products, price reduction, longer store hours) Utility: ability of a product to satisfy a human want or need.

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