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Marketing for the 21st Century

Chapter Questions
Why is marketing important? What is the scope of marketing? What are some fundamental marketing concepts? How has marketing management changed? What are the tasks necessary for successful marketing management?
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What is Marketing?
Marketing is a process by which companies create value for customers and build strong customer relationships to capture value from customers in return The aim of marketing is to know and understand the customer so well that the product and service fits him and sells itself. (Drucker, 1973).
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What is Marketing?
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.

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What Is Marketing?
The Marketing Process

What is Marketing Management? Marketing management is the art and science of choosing target markets and getting, keeping, and growing customers through creating, delivering, and communicating superior customer value. What customers will we serve? How can we best serve these customers?
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CREATING VALUE

Marketing
Marketing involves customer satisfaction and their current and future needs. Marketing is not only much broader than selling but it also encompasses the entire companys market orientation toward customer satisfaction in a competitive environment. Within marketing strategies, companies are always under competitive pressure to move forward both reactively and proactively.

Good Marketing is No Accident

Starbucks plans to ensure its marketing successes in countries around the world. Wal-Mart which has become the worlds largest retailerand the worlds largest companyby delivering on its promise, Save money. Live Better. At Disney theme parks, imagineerswork wonders in their quest to make a dream come true today. Apple fulfills its motto to Think Different with dazzling, customer-driven innovation that captures customer imaginations and loyalty. Its wildly successful iPod grabs more than 70 percent of the music player market; its iTunes music store captures nearly 90 percent of the song download business.
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New Consumer Capabilities

A substantial increase in buying power A greater variety of available goods and services A great amount of information about practically anything google about anythig Greater ease in interacting and placing and receiving orders An ability to compare notes on products and services An amplified voice to influence public opinion fb, twit,
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The marketplace isnt what it used to be

Information age i.e. lead to more targeted communication, relevant pricing

Information technology Globalization Deregulation Privatization Competition Convergence

i.e. electronics & computing industries Less loyal & price quality sensitive technological advances

greater competition and growth opportunities

increase efficiency?

Consumer resistance

Retail transformation
entertainment into their stores to compete nontraditional stores

What is Marketed?
Goods Services Events & Experiences Persons Places & Properties Organizations Information Ideas
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Marketing Can Promote Ideas

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Key Customer Markets

Consumer Markets Global Markets

Core Marketing Concepts

Needs, wants, and demands Target markets, positioning, segmentation Offerings and brands Value and satisfaction Marketing channels Supply chain Competition Marketing environment

Business Markets

Nonprofit/ Government Markets

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I want it, I need it

Selecting Customers to Serve

Market segmentation refers to dividing the markets into segments of customers Target marketing refers to which segments to go after

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All Four Ps Contribute to the Whole

Product Place Promotion Price
Understanding the Target Market Leads to Good Strategies!

Understanding the Marketplace and Customer Needs

Market offerings are some combination of products, services, information, or experiences offered to a market to satisfy a need or want Marketing myopia is focusing only on existing wants and losing sight of underlying consumer needs

Selection of Target Market

Avoiding Marketing Myopia by Focusing on Benefits

Company MCI Worldcom Myopic Description We are a telephone company. Marketing-Oriented Description We are a communications company. We are in the transportation business. We are in the financial services business. We are in the entertainment business.

Value Proposition

The value proposition is the set of

Northwest Airlines Prudential Securities Sony

We are in the airline business. We are in the stock brokerage business. We are in the video game business.

benefits or values a company promises to deliver to customers to satisfy their needs Meeting customers needs

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Creating Value
The central Role Marketing stems from the fact that marketing is the process via which a firm creates values for its chosen customers. Value is created by meeting customer needs. Thus, a firm must define itself not by the product it sells, but by the customers benefit provided.

Customer Value and Satisfaction

Customer perceived value The difference between total customer value and total customer cost Customer satisfaction The extent to which a products perceived performance matches a buyers expectations

Creating Value ?

Determinants of Customer Delivered Value

Customer Needs & Wants R&D

Marketing

Engineering

Manufacturing

Customer Value

The Value Chain

Decisions at every stage, from idea conception to support after the sale, should be assessed in terms of their ability to create value for customers.

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What Customers Really Buy

Value is best described in terms of utility The Four utilities : Form/Function Utility - Physical Characteristics of Offering Possession Utility - Ease of Taking Ownership of Offering Time Utility - Offering Available When Needed Place Utility - Offering Available Where Needed
All organizations must create utility to survive.

Marketing & Competitive Advantage

When a company succeeds in creating more value for customers than its competitors in an industry

Company Orientations Marketing Management Orientation

Production Product Societal Selling Marketing

Production & Product concepts

is the idea that consumers will favor products that are widely available and inexpensive Business philosophy stressing efficiency in producing a product Attitude toward marketing is a good product will sell itself. The product concept holds that consumers will favor those products that offer the most quality, performance, or innovative features.

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Sales Orientation
The selling concept holds that consumers and businesses, will ordinarily not buy enough of the organizations products, therefore, the organization must undertake aggressive selling and promotion effort.

Selling is only the tip of the iceberg

There will always be a need for some selling. But the aim of marketing is to make selling superfluous. The aim of marketing is to know and understand the customer so well that the product or service fits him and sells itself. Ideally, marketing should result in a customer who is ready to buy. All that should be needed is to make the product or service available. Peter Drucker
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.that only creative advertising and personal selling can overcome consumers resistance and convince them to buy.

Contrasting Sales & Marketing

Organizations Focus Inward What Business Are You In? For Whom? How Will You Make Profit? Using What?

Marketing Concept
The marketing concept holds that the key to achieving organizational goals consists of the company being more effective than competitors in creating, delivering, and communicating superior customer value to its chosen target markets.

Sales (Factory) Orientation

Selling goods Everybody Maximum Primarily sales promotion and services volume

Marketing Orientation

Outward (Market)

Satisfying wants and needs

Specific Customer Coordinated groups of satisfaction use of all marketing people activities

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Production-Oriented and MarketingOriented Managers Have Different Views of the Market,

Societal marketing
Societal marketing concept is the idea that a company should make good marketing decisions by considering consumers wants, the companys requirements, consumers long-term interests, and societys longrun interests

Societal Marketing

Holistic Marketing Dimensions

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The Four Ps

Preparing an Integrated Marketing Plan and Program

The marketing mix is the set of tools (four Ps) the firm uses to implement its marketing strategy.It includes product, price, promotion, and place. Integrated marketing program is a comprehensive plan that communicates and delivers the intended value to chosen customers.

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Internal Marketing
Internal marketing is the task of hiring, training, and motivating able employees who want to serve customers well.

Performance Marketing
Financial Accountability Social Responsibility Marketing
Social Initiatives Corporate social marketing Cause marketing Corporate philanthropy Corporate community involvement Socially responsible business practices

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Marketing Management Tasks

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So, What Is Marketing? Pulling It All Together

Develop market strategies and plans Capture marketing insights Connect with customers Build strong brands Shape market offerings Deliver value Communicate value Create long-term growth

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