Chapter 1

The Field of
Marketing
Sommers

Barnes

Ninth Canadian Edition

Presentation by

Karen A. Blotnicky
Mount Saint Vincent University, Halifax, NS
Copyright 2001 by McGraw-Hill Ryerson Limited

Chapter Goals
To gain an understanding of:
The relationship between exchange and marketing
How marketing applies to business and nonbusiness situations
The evolution of marketing
Services and relationship marketing
The factors that drive customer satisfaction
The difference between marketing and selling
The marketing concept
The impact of quality, service and ethics in modern
marketing
Marketings role in the global economy, in an
individual organization, and in your life

Copyright 2001 McGraw-Hill Ryerson Limited

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Definition of
Marketing

Marketing is the total system of business

activities designed to plan, price, promote,
and distribute want-satisfying products,
services, and ideas to target markets in
order to achieve organizational objectives
Marketing means adopting a customer
focus for the organization; keeping the
customers needs in mind all the time. It
may not always mean making an
immediate sale.
Copyright 2001 McGraw-Hill Ryerson Limited

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In the Socioeconomic
System:
Marketing creates
utilities:
Image utility is the
Place utility makes a
emotional or
product accessible to
psychological value
potential customers
that the customer
where they want it.
attaches to a
Time utility makes a
product or brand.
product available when Possession utility is
they want it.
created when
Information utility is
ownership is
created by informing
transferred to the
prospective buyers that a buyer.
product exists.
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Copyright 2001 McGraw-Hill Ryerson Limited

Importance of Marketing
to Organizations
The basic reason for firms existence
is customers want satisfaction.
Marketing is the only revenueproducing activity for the firm.
Marketing has become increasingly
important for service firms and notfor-profit organizations.

Copyright 2001 McGraw-Hill Ryerson Limited

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The Global Importance

of Marketing

Nations depend upon marketing to sell

their raw materials and industrial
output to other countries.
Companies now compete in markets
all over the world.
Honda and Toyota now build cars in
Canada, starting from nothing 15
years ago.

Copyright 2001 McGraw-Hill Ryerson Limited

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The Importance of
Marketing
in
Your
Life
Marketing is a large part of your daily
life. Consumers are exposed to 3,000
commercial messages a day.
Studying marketing will make you a
better-informed customer.
Marketing probably relates -- directly or
indirectly -- to your career aspirations.

Copyright 2001 McGraw-Hill Ryerson Limited

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Key Words in the

Marketing Definition
total system: not an ad hoc approach
business activities: but not just for
businesses
plan, price, promote, distribute : the
marketing mix
want-satisfying: meeting customers needs
products, services, ideas: not just
products
target markets: not a broad-brush
approach
organizational objectives: not just profits
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Copyright 2001 McGraw-Hill Ryerson Limited

The Focus of Marketing

marketing involves the exchange of
things of value
much of marketings focus today is on
the creation of value for customers
we must develop a good understanding
of customer needs and wants
ultimately, successful companies
develop a close customer relationship

Copyright 2001 McGraw-Hill Ryerson Limited

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Fundamental Bases
for Exchange
Two or more people, or units, must be
involved
Parties must be willing to be involved
(voluntary participation)
Each party must have something of
value to contribute to the exchange
Parties must communicate with each
other to facilitate the exchange
process
Copyright 2001 McGraw-Hill Ryerson Limited

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Evolution of Marketing
marketing has evolved from a production,
to a selling, to a marketing stage
in the production-orientation stage,
emphasis was on making a better physical
product
in the sales-orientation stage, the
emphasis was on how to sell that product
a marketing-oriented organization places
emphasis on satisfying the wants and
needs of customers
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Stages in the Evolution of Marketing

PRODUCTION ORIENTATION
Some industries and organizations remain at the
production-orientation stage.

PRODUCTION ORIENTATION

SALES ORIENTATION

Other industries and organizations have progressed only to the

sales-orientation stage.
PRODUCTION
ORIENTATION

SALES
ORIENTATION

MARKETING
ORIENTATION

Many industries and organizations have progressed to the

marketing-orientation stage.
Late 1800s

Early 1930s

Mid-1950s

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1900s

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The Marketing Concept

objective is to produce long-term customer
satisfaction and organizational success
all of the organizations planning and
operations are customer-oriented
all of the marketing activities of the
organization should be consistently
designed and delivered
all activities are intended to achieve the
firms organizational objectives

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An Innovation Based on the

Marketing Orientation.
Relationship Marketing

An attempt to build personal,

long-term bonds with
customers.
Relationship marketing has
expanded to include all groups
an organization interact with:
suppliers, employees, unions,
government, and even
competitors.
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Drivers of
Customer Satisfaction

getting the core product right is

essential
many services and systems support
the core
customers expect good technical
performance of the product or service
they also expect to be treated well in
face-to-face interaction with employees
the company must also consider how it
makes the customer feel in many
subtle ways
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The Difference Between

Marketing and Selling
Marketing is the process of
determining customer wants and
then developing a product to satisfy
that need and still yield a satisfactory
profit. It is externally focused.
Selling is producing a product and
then trying to persuade customers to
purchase it -- in effect, trying to alter
consumer demand. It is internally
focused.
Copyright 2001 McGraw-Hill Ryerson Limited

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How Should Marketing Be

Defined?
Company ProductOriented

MarketingOriented

Kodak

We help preserve
beautiful
memories.

We make cameras
and film.

Amazon.co We sell books and

recordings.
m

HewlettPackard

We make computer
printers.

Levi
Strauss

We make blue jeans

Caterpillar We make

Copyright 2001 McGraw-Hill Ryerson Limited

construction

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The Marketing Concept

MARKETING CONCEPT
Customer
orientation

+
Organizations
performance
objectives

+
+

Coordinated
marketing
activities

Customer
satisfaction

Copyright 2001 McGraw-Hill Ryerson Limited

Organizational
success

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.The

Societal
Marketing Concept
A revised philosophy,
called the societal
marketing concept,
concept
involves broadly defining
customer and taking a
long-term view of
customers satisfaction.
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Quality in Marketing
quality in what an organization offers is a major
contributor to value and customer satisfaction
if the customer is satisfied with the quality, he or
she is likely to return to buy again
quality is very much defined by the customer; it
also varies across individuals and over time
quality, as perceived by the customer, is influenced
not only by physical products but by service as well
requires a commitment from all staff to deliver the
highest quality possible

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Another Innovation:
Mass Customization
An attempt to provide
affordable products customized
to come as close as possible to
meeting the needs of individual
customers.
This is made possible because
of advances in information
technology.

Copyright 2001 McGraw-Hill Ryerson Limited

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Ethics in Marketing
Marketing is intended to influence
the behaviour of customers and
others.
The use of marketing tools can create a
wide variety of ethical challenges.
There is disagreement over what
constitutes ethical or unethical
behaviour.
Ethics are standards of behaviour
generally accepted by society.
Ethics vary from society to society.
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More About Ethics

Corporations are taking action to
instill ethical awareness in their
employees by:
Avoiding unreasonable pressure on
employees to perform.
Communicating clearly what is
expected of employees.
Employing an Ethics Officer to advise
employees on ethical dilemmas.
Rewarding only ethical performance.
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