Chapter 1.docx

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Department
Management and Organizational Studies
Course
Management and Organizational Studies 1021A/B
Professor
Kevin Thompson
Semester
Fall

Description
Chapter 1 - Marketing The Essence of Marketing -marketer’s ultimate objectives are to drive profits for a company, or if working in the non-profit sector, to generate revenue and support to fund programs and run operations. -Marketing is described as the process of planning and managing goods, services, or ideas to meet consumer needs and organizational objectives. Marketers are ultimately responsible for generating company profits and marketing programs are designed with this end in mind. Focusing on Customer Needs -The essence of successful marketing is focusing on customer needs and developing programs that delight consumers and encourage customer loyalty. Creating Customer Value -Customer value is the unique combination of benefits received by targeted consumers that includes quality, price, convenience, delivery, and both before-sale and after-sale service. -Creating products with added value is often achieved through: (1) Product design (2) Pricing strategies (3) Service elements Appealing to Target Markets -a target market can be formally defined as the specific group of existing and potential consumers to which marketers direct their marketing efforts. Marketing Mix (the 4 P’s) Product all the attributes that make up a good, service, or an idea, including product design, features, colour, packaging, warranty, and service levels Price the expected regular retail or sale price for a product Place the distribution channels, retail formats, and merchandising used to sell a product. Promotion the communication tools needed to inform consumers about a product, including advertising, public relations, direct response, event marketing and sponsorship, and personal selling. -It is important to note that, over time, marketers gather extensive information on their target markets, being able to identify purchase motivation that goes beyond age and gender into behavioral and psychological motivation, which is an important determinant in many purchases. Marketers define their target markets in more-complex terms, including elements such as likes, dislikes, motivation, interests, and concerns. The Marketing Process The marketing process involves: (1) identifying consumer needs (2) managing the marketing mix to meet these needs (3) realizing profits, or in the case of non-profits, secure revenues or provide services to those in need. Exchange- is the trade of things of value between buyers and sellers so that each benefits. Product- encompasses goods, services, and ideas. These can all be marketed Good- is a product that you can touch and own. Service- an intangible product you cannot touch. **Ideas can also be marketed. An idea is a concept that typically looks for support. An example is Earth Hour campaign from the World Wildlife Fund. Campaign encouraged people around world to show support to reduce climate change by turning off their lights. -Many successful marketers today launch products with layers of goods, services, and ideas to connect with consumers. They offer whole package deal. Ex: smart cars – launched new electric vehicle (product), During testing phase Smart Canada worked with Toronto Hydro to provide battery charging stations in testers’ garages. Smart Canada also provided auxiliary services such as battery charging stages, winter tire packages, and 24 hr road side assistance (services). Promotional programs such as the smart Electric lounge at the 2011 Int. Auto Show also pointed to the importance of using electric power to support the environment (idea). What is a market? - the term market is used in marketing to describe potential consumers who have both the willingness and ability to buy a product. The Evolution of Business Philosophies Up until the 1930s businesses were in the (1) Production Orientation: stage focused on manufacturing. Manufactured goods tended to sell, regardless of their quality because they were in short supply. Consumer needs were not a priority. 1930s-1960s (2) Sales Orientation: stage focused on selling as many products as possible. The market had become more competitive, production had become more efficient, and products were in abundance. 1960s (3) Marketing Orientation: stage focuses on the idea that an organization should strive to satisfy the needs of consumers while also trying to achieve an organization’s goals. THE MARKETING CONCEPT FOLLOWS THIS IDEA - An organization that has a marketing orientation focuses its efforts on continuously collecting information about customers’ needs, sharing this information across departments, and using it to create customer value. Marketing Concept- the idea that an organization should strive to satisfy the needs of consumers while also trying to achieve organizational goals. Relationship Marketing- when organizations create long-term links with their customers, employees, suppliers, and other partners to increase loyalty and customer retention. -Internet technology is fuelling the growth of relationship marketing as a business approach. (a) Social media, (b) database technology, and the increased importance of (c) corporate social responsibility are all pointing toward creating meaningful relationships with customers to drive business success. (a) Social Media – ability to interact with consumers (often in real time), through social networks (ie. Fbook, twitter, myspace, youtube) has added a new dimension to relationship marketing, making it more immediate and interactive. Social media provides consumers with the ability to interact with marketing messages by posting comments that are visible to all. This encourages companies to be more transparent and interactive in their communications. Social media can be used in 4 ways: (1) Marketers use social media to engage and connect with consumers. (ex. Special offers like coupons may be sent) (2) Marketers use social media to monitor real-time consumer engagement and brand buzz and to provide customer service. (monitor consumer comments on social sites and respond in real-time to customer queries). (3) Marketers can use social media to measure the impact of specific promotional programs. (4) Marketers can use social media to identify informal brand advocates that can spread positive messages about a brand. (b) Database Technology Customer Relationship Management (CRM) -defined as the overall process of building and maintaining profit
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