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Chapter

BU352 Chapter Notes -Marketing Mix, Voice Of The Customer, Pro Forma

by

Department
Business
Course Code
BU352
Professor
Brent

Page:
of 5
Chapter 1: Overview of Marketing
Marketing: A set of business practices designed to plan for and present an organization’s
products or services in ways that build effective customer relationships
- Thoughtful planning and impacts of decisions on ethics and consumers and society
Marketing Plan: A written document composed of an analysis of the current marketing
situation, opportunities and threats for the firm, marketing objectives and strategy specified in
terms of the four Ps, action programs, and projected or pro forma income (and other financial
statements)
- Specifies marketing activities for a specific period of time
- Includes: how product will be conceived, how much should it cost, where it will be
promoted, how to get it to the customer
Core Aspects of Marketing:
- Marketing:
o is about satisfying customer needs and wants
o entails value exchange
o requires product, price, place, and promotion decisions
o can be performed by both individuals and organizations
o occurs in many settings
o Marketing helps create value
1. Marketing is about Satisfying Customer Needs and Wants
Need: A person feeling physiologically deprived of basic necessities, such as food, clothing,
shelter, and safety
Want: The particular way in which a person chooses to satisfy a need, which is shaped by a
person’s knowledge, culture, and personality
Market: Refers to the groups of people to whom an organization is interested in marketing its
products, services, or ideas. To understand needs and wants, must understand market
- The people who need/want the company’s services and have the ability and willingness
to buy.
Target Market: The customer segment or group to whom the firm is interested in selling its
products and services. It is potential customers who have both an interest in the product/service
and an ability to buy. Ex. Seniors, children, toddlers, preteens, teens, and adults
- Which market segments is your product most relevant to
- Build a marketing strategy that meets needs and wants of your target market
2. Marketing Entails Value Exchange
Exchange: The trade of things of value between the buyer and the seller so that each is better off
as a result
Exchange Diagram (Seller Buyer Relationships):
3. Marketing Requires Product, Price, Place, and Promotion Decisions
- 4 interrelated decisions, the marketing mix made up of the 4 ps (product, price, place,
promotion)
Marketing Mix: Product, price, place, and promotion- the controllable set of activities
that a firm uses to respond to the wants of its target markets
Product: Creating Value
- Create value by developing a variety of offerings, (goods, services, and ideas), to satisfy
customer needs
- Ex. Bottled water...created benefits that the consumer finds valuable (convenient, chic)
- Goods: items that you can physically touch
- Services: intangible consumer benefits that are produced by people or machines and
cannot be separated from the producer. Ex. Entertainment- hockey games
- Ideas: Thoughts, opinions, philosophies, and intellectual concepts ex. Bike safety
Price: Transacting Value
Price: the overall sacrifice a consumer is willing to make- money, time, or energy- to acquire a
specific product or service
- Marketers must determine price of product based on potential buyer’s belief about its
value
- Determining how much customers are willing to pay so that they are satisfied with the
purchase and the seller achieves reasonable profit
Place: Delivering Value
- All the necessary activities to get the product from the manufacturer or producer to the
right customer
- Efficient system for merchandise to be distributed in the right quantities, locations and
time in the most efficient way to minimize costs and meet customer satisfaction
- Must provide product when and where customers want it, or else sales will suffer
Promotion: Communicating Value
- Communicate value to customers
- Informs, persuades, and reminds potential buyers about a good/service to influence their
opinions or elicit a response
- Enhances a product value
- Company’s marketing activities are also influenced by external factors:
o Forces, organizations, individuals
External Factors Include: (CD STEP)
o Social/Cultural Trends (ex. Environment, obesity)
o Technology
o Economic
o Political/Regulatory
o Competitors
o Demographics
- Also influenced by:
o Suppliers
o Distributers
o other intermediaries (financial institutions, advertising agencies)
o advocacy groups
4. Marketing Can be Performed by Both Individuals and Organizations
B2C (Business to Consumers): The process in which businesses sell to consumers
B2B (Business to Business): The process of selling merchandise or services from one business
to another
C2C (Consumer to Consumer): The process in which consumers sell to other consumers
- Individuals also market themselves (resume, cover letter, interview)
- Individuals who sell their services (accountants, lawyers, physicians)
5. Marketing Occurs in Many Settings
- Profit and not for profit
- All kinds of organizations market their message (universities, charities etc)
- Designed to benefit entire industry, benefits many firms simultaneously (ex. Got Milk?)
6. Marketing Helps Create Value
- Marketing has evolved over time:
Production-Oriented Era
- Early 20th century
- Believed that a good product would sell itself
- Ex. Ford.. “Customers can have any colour as long as its black”
- Concerned with product innovation, not satisfying customer needs
- Developing and distributing innovative products
Sales-Oriented Era
- 1920-1950
- Great Depression and WWII, customers consumed less
- Thus, manufacturers produced more than what customers wanted, overproduction
- Needed lots of personal selling and advertising to get rid of overproduction
- Companies tried to sell as much as possible, didn’t care what customers really wanted