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Chapter 1

Chapter 1 What is Marketing (NOTES).docx

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MKTG 2030
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MKTG 2030 – Section V Jan. 3, 2012 Part I – Identifying & Specifying Value Opportunities: - Marketing is first and foremost a decision making process – one that is focused on identifying, creating, and delivering value for customers and other stakeholders. - Leading businesses achieve their success not only by creating economic value, but also by creating social and environmental value. Chapter 1 – What is Marketing? WELCOME TO BRANDED YOU: - Marketing is all around us – YOU are a product  companies like Monster and Facebook couldn’t exist if you weren’t a product with value. - Value – the benefits a customer receives from buying and using a good/service in relation to the costs and sacrifices of buying and using it. - You have “MARKET VALUE” as a person – you have qualities that set you apart from others and abilities other people want and need. - Marketing is a fundamental part of our lives both as consumers and as business people. THE WHO AND WHERE OF MARKETING: - Fashion retailers may have training in design; advertising creative executives often have a fine arts background while copywriters often have degrees in English; E-marketers who design interactive WebPages for products and companies may have studied Computer Science; accountants often end up in marketing roles, as someone needs to make marketing decisions for actg firms. - Marketers work in a variety of locations  consumer good companies, services companies, retail organizations, companies that manufacture products for other companies, gov’t organizations, not for profit organizations, large organizations, small start up companies, etc. - Marketing principles used to get people to endorse ideas/change their behaviours in positive ways. - Marketing is an organizational function and a set of processes for creating, communicating, and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders. - Marketing is the process of achieving individual and organizational objectives by creating superior customer value for one or more target markets with a sustainable strategy.  Prime directive of marketing is to achieve objectives.  Focuses on the idea of creating value for specific target markets, groups of people that have different needs, wants, or preferences from other groups of people.  Develop a sustainable strategy in the sense of making a set of decisions that will allow us to compete effectively until our objectives have been achieved (usually a long term perspective) - Customer Value –what the customer gets in the purchase, use, and ownership of a product relative to the costs and sacrifices incurred. - To create a transaction/economic exchange of value, both parties need to believe that the exchange is FAIR. - Challenge to marketer is to create, price, distribute and communicate an attractive value proposition to the customer to get the most value in return. MARKETING IS ABOUT CREATING CUSTOMER VALUE: - Stakeholder – people/organizations who influence or are influenced by mktg decisions. MKTG 2030 – Section V Jan. 3, 2012 - Exchange – the process by which some transfer of value occurs b/w a buyer and a seller. - Consumer – the ultimate user of a good/service. - Marketing concept – business orientation that focuses on achieving org. objectives by understanding customer needs, creating and delivering value in exchanges that satisfy the needs of all parties. - Need – recognition of any difference b/w a consumer’s actual state and some ideal or desired state. - Want – desire to satisfy needs in specific ways that are culturally and socially influenced. - Benefit – outcome sought by a customer that motivates buying behaviour (that satisfies a need/want) - Consumers are motivated by needs, but make purchase decisions based on wants. - Demand – customers’ desire for products coupled with the resources to obtain them - Marketplace – any location or medium used to conduct an exchange. MARKETING IS ABOUT EXCHANGE RELATIONSHIPS: - For an EXCHANGE to occur, at least 2 people/organizations must be willing to make a trade, and each must have something the other wants  both must agree on the value of the exchange and how it will be carried out  must be free to accept or reject the other’s terms for the exchange. - The marketing decision process:  Understand the opportunity  Marketing Strategy: specify the value  Marketing Mix: create the value  Implementation & Evaluation: Realize the value. Understand the Opportunity: - Identify opportunities to create value for the organization by creating value for customers. - First, involves understanding factors relating to the markets in which an org. competes (understanding general trends in that market, consumer/organizational buying behaviour, industry dynamics, and the strategies and likely reactions of competitors. - Then marketing decision makers need to assess factors relating to their own org. and their ability to create value and compete effectively in those markets (internal factors  include understanding relative effectiveness of current mktg strategy, resources, competencies, expertise and values/mission of org. Marketing Strategy: Specify the Value: - Marketers make mktg strategy decisions to achieve the objectives of their org. which usually include both financial and mktg objectives. - Market segment – distinct group of customers within a larger market who have similar needs, wants, preferences, and behaviours, who seek similar product solutions, and whose needs differ from other customers in the larger market. -
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