The JMSB MBA

MBA 610 Marketing

Management
Winter 2015
Dr. Tarek Mady

Chapter 1

Defining Marketing for

st
the 21 Century

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

Agree? Disagree? Unsure?

1. Marketing is simply another word for Advertising.
2. Marketing tasks are fairly simple, particularly compared to
complex and serious roles/functions like finance and
engineering.
3. People who are successful in marketing are really creative
and outgoing but are not that good with numbers and
statistics.
4. Marketing is all about making people buy products they
dont really want.
5. People in marketing roles tend to have little interaction
with staff from other departments (functions) within a firm.
6. Many key marketing decisions within a firm are so
important that the CEO (or the senior executive team)
often undertakes them (rather than the marketing
department).
7. The main goal of marketing is to maximize the number of

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

Why are we here?

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

Ralph Waldo Emerson

If a man
makes a better
mousetrap,
the world will
beat a path to
his door.

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

Is that
true?

The Mousetrap Fallacy

If a man makes a better mousetrap, the world will beat a
path to his door

Market Awareness
If nobody knows you exist and have built
a mousetrap, no one will know that there
is a path worth beating!

Actual Need
If people do not have a mouse problem,
they do not need a mousetrap!

Perceived Need
People who have mice, but are not aware
of their existence, will not be interested
in your mousetrap.
People who think mice are, "the cutest little things,"
MBA
are not good prospects either.
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

The Mousetrap Fallacy

If a man makes a better mousetrap, the world will beat a
path to his door

Definition of Better
Prospects will buy your product
only if they agree it is better.

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

The Mousetrap Fallacy

If a man makes a better mousetrap, the world will beat a
path to his door

Definition of Better
Its better if I dont have to buy
cheese!

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

The Mousetrap Fallacy

If a man makes a better mousetrap, the world will beat a
path to his door

Definition of Better
Its better if I dont get hurt
setting it up!

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

The Mousetrap Fallacy

If a man makes a better mousetrap, the world will beat a
path to his door

Definition of Better
Its better if I catch the mouse,
not necessarily kill it!

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

The Mousetrap Fallacy

If a man makes a better mousetrap, the world will beat a
path to his door

Definition of
Better
Its better if my
friends envy me for
my mousetrap . . . .
For that prospect, a
better mousetrap
comes in designer
hues (Burberry or
Louis Vuitton
Mousetrap?)
MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

10

The Mousetrap Fallacy

If a man makes a better mousetrap, the world will beat a
path to his door

The Effort of Beating

the Path
Even if customers have
real needs, perceive
their existence, and
recognize your product
as better, they still
may not beat a path to
your door.
The effort customers will
expend to buy your product
depends on their perception

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

11

So what does this all

mean?

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

12

Marketing is
. . . the process of planning and executing
the conception, pricing, promotion, and
distribution of ideas, goods, and services
to create exchanges that satisfy individual
and organizational objectives.

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

13

The simple Marketing

(exchange) system

Goods /Services

Supplier

Marketing
Exchange
transactions

Consumer

Money / Patronage

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

14

What is Marketing?
(AMA Definition)

Marketing is the activity, set of

institutions, and processes for creating,
communicating, delivering, and
exchanging offerings that have value for
customers, clients, partners, and society
at large.

Meeting needs
profitably

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

15

Marketing is embedded in
all aspects of
business . . .

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

16

Exchange Economy

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

17

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.

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

18

Marketers often have to deal

with several Demand States
Negative demand
Nonexistent
demand

Consumers dislike the product and may even pay to avoid it.
Consumers may be unaware of or uninterested in the
product.

Latent demand

Consumers may share a strong need that cannot be satisfied

by an existing product.

Declining demand

Consumers begin to buy the product less frequently or not at

all.

Irregular demand

Consumer purchases vary on a seasonal, monthly, weekly,

daily, or even hourly basis.

Full demand

Consumers are adequately buying all products put into the

marketplace.

Overfull demand

More consumers would like to buy the product than can be

satisfied.

Unwholesome
demand
MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

Consumers may be attracted to products that have

undesirable social consequences.
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Some terms you will hear

over and over during the
semester . . .

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

20

Needs, wants and demands

Needs:
State of felt deprivation including physical,
social, and individual needs.

Wants:
Form that a human need takes, as shaped by
culture and individual personality.

Wants + Buying Power = Demand

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

21

Marketings
Our Job first
. . .task: discovering
consumer needs

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

22

Marketings second task:

satisfying consumer needs

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

23

In theory, its easy

The problem is there are so many
other factors, not to mention
competitors trying to out-market
you..

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

24

The uncontrollable,
environmental factors

Social Factors
Economic Factors
Technological Factors
Competitive Factors
Regulatory Factors

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

25

Major Forces

Network information technology

Globalization
Deregulation
Privatization
Heightened competition
Industry convergence
Retail transformation
Disintermediation
Consumer buying power
Consumer information
Consumer participation
Consumer resistance

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

26

What do customers really

need (want)?

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

27

Value
the unique combination of benefits
received by target buyers that includes :

Quality
Price
Convenience
On-time delivery
After-sale service

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

28

Value
Value is a trade-off between all the
benefits an offering provides and all the
costs incurred in obtaining and using the
offering
Perceived
Value = Benefits
Perceived Costs

Customer-perceived value, not supplier- perceived value

Value may be time or situation dependent
MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

29

So should giving value be

a one time thing?

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

30

What Is a Market?
The set of actual
and potential
buyers of a product
or offering.
These people share
a need or want
that can be
satisfied through
exchange
relationships.
MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

31

Does that mean

everyone ?

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

32

Target Markets,
Positioning & Segmentation
Marketers start by dividing
the market into segments.
By examining demographic,
psychographic, and
behavioural differences
among buyers, marketers
identify and profile distinct
groups of buyers who might
prefer or require varying
product and service mixes.

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

33

The Target Market

Because the organization
obviously cant satisfy all
consumer needs, it must
concentrate its efforts on
certain needs of a specific
group of potential
consumers.
This is the target market -one or more specific groups
of potential consumers
toward which an

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

34

Positioning
is the act of designing an
organizations offering and
image so that it occupies a
distinct and valued place in
the target customers mind
relative to competitive
offerings.
Often associated with
branding . . .
MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

35

Marketing itself is
changing . . .

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

36

New Company Capabilities

Marketers can use the Internet as a
powerful information and sales channel.
Marketers can collect fuller and richer
information about markets, customers,
prospects, and competitors.
Marketers can tap into social media to
amplify their brand message.
Marketers can facilitate and speed
external communication among
customers.
MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

37

New Company Capabilities

Marketers can send ads, coupons,
samples, and information to customers
who have requested them or given the
company permission to send them.
Marketers can reach consumers on the
move with mobile marketing.
Companies can make and sell individually
differentiated goods.

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

38

But not all companies

adopt marketing thoughts
...

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

39

Company Orientations
Production
Product
Selling
Marketing

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

40

An emerging concept . . . .

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

41

Holistic Marketing
Dimensions

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

42

A few final words about

the 4 Ps

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

43

The Four P Components of the

Marketing Mix

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

44

Marketing Management tasks

typically go well beyond the 4Ps

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

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

45

Alternative ways to view what we offer

and what we need to focus on . . .

Typical
Marketing
Mix
(Four Ps)
Product
Place
Promotion
Price

MBA
MBA 610
610 Marketing
Marketing Management
Management
Dr. Tarek Mady

Customer
Oriented
Marketing Mix
(Four Cs)
Customer
Solution
Convenience
Communication
Cost

Modern
Marketing
Managem
ent (Four
Ps)
People
Processes
Programs
Performanc
e
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