INTRODUCTION TO MARKETING

Early civilisation- produced excess capacity development in the 17th centuryAdvances in technology Mass production New production processes Shift from agriculture to manufacturing Increased output

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Greater desire to trade Large scale production- larger distribution network Focus on supply side- increased production efficiency Laid the foundation of the modern industrial society

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20th century- improvement in technology Transition from production to consumption Competition- local/regional/international No longer problem of supply but in terms of anticipating demand Businesses struggling to establish customer preferences for their products in relation to competitors

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Use of modern marketing practices Use of advertisement, Branding Packaging Marketing research Product improvement and new product development invest in research

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Marketing is a human activity directed at satisfying needs and wants (Kotler) The marketing concept holds that the main task of the company is to determine what a given set of customers needs, wants, and values are and to dedicate the organization to delivering the solution.

What is marketing -Definitions

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It is the management process for identifying, anticipating and satisfying the needs and wants requirements (CIM) People can satisfy their needs and wants in four ways: 1. Self solution ( coming up to the answer of the problems themselves.

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2. Force threatening/ stealing 3. Begging looking for sympathy 4. Exchange (offering something of value to the owner): this last method is mutually beneficial to both parties. This value exchange summarises marketing and applies in every type of product exchange how

What is marketing -Definitions

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For this to be possible it is important that the two parties must have : Have something of value to exchange Be capable of communicating Be free to accept or reject the exchange situation

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Successful exchange will only occur when there is some individual or organisation with enough interest (and available resources) who is prepared to enter to enter into an agreement with the owner or producer of a particular item (s)

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How the company presents itself and its activities to the world will depend very much on a combination of factors: 1. The nature of product being sold 2. The beliefs of the decision makers 3. The extent of influencers from the environment 4. Customer expectations

The strategic orientation of Business

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The perceptions of the public may influence to a large extent the strategy the company adopts which are known as strategic business concepts ; there are four 1. Production concept 2. Product concept 3. Sales concept 4. Marketing concept

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Production concept: produces more than demand: concentrate only on production not on marketing = low price Production concept good for High demand Market is low cost and high turnover Buyers are sensitive to prices
1.

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2.

Organisation has capacity for mass production Product concept: Managers believe that customers would recognise a good product and buy it when it is made available. Focus on quality Carry market research before production

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The strategic orientation of Business

Companies following a product orientation can be successful only when: There is a current demand for the product There is a potential demand for the product Products are given full marketing support Products meet customer requirements

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3. Sales concept Selling only what the company makes- it does not make what it can sell. Involve heavy activity on the selling and promotional aspects with provision of incentives- discounts/ Company interested in moving stock rather in stocking the right goods

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Sales concept implies the existence of an aggressive work force Sales concept works only when there is: Need for little after sales service Companies not interested in building relationship with customers Buyers have low expectations of the product

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4. Marketing concept Firmly believe that the customer is key to successful business Begins with the customer and the company try to give what the customer wants rather than making the customer want what the company has

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Three distinct characteristics of the marketing concept: customer orientation: identify needs from customer point of view Organisational integration: all functions,depts work together to achieve organisation objectives and give customer satisfaction

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The concept of the Marketing environment No organisation work and stand in isolation. Affected by a number of factors both internally and externally: 1. The external factors (known as the macro environment) 2. The internal environment ( known as the internal environment)

The Marketing Environment

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1. The Macro environment (four distinct areas) known by PEST; Political factors ( govt actions, laws) Economic factors (income,inflation, patterns of consumption) Social factors ( pop size,changing family patterns,cultural values)

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 Technological

factors (shorter life cycles, new work processes, 2. the Micro environment: the micro environment includes not only the company itself but also its customers, competitors and suppliers
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The Marketing Environment

 The

customer environment Consists of individuals and households that buy and consume the products. Consumer goods fall within two broad bands: Fast moving consumer goods Durable goods
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 The

competitor environment: Competition forms a major part of the environment in which the company operates. Few companies do not have competitors ( e.g monopolies ,govt forcing companies back into competition
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Competition should be assessed in different ways: Direct competition: those companies that produce the same types of products and sell to the same customers in
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 Industry

competition: Those companies that operate in the same broad areas but do not necessarily serve the same markets
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 Indirect

The Marketing Environment

competition: Companies who make different products or services, but which may attract the resources or compete for the disposable income of the markets you wish to serve.
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 Good

examples of this include the purchase decisions to buy a car or to go on holiday, to move to house or to pay school fees. The supplier environment: Linked today to quality management and relationship marketing
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 Suppliers

are essential for the company to produce goods and services Supplier development and relationship can seriously affect marketing.
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 Micro

environment is closer to the company and consist of the forces, people, and organisations which operate within the immediate environment of the company.

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Usually the marketing people can have certain influences on the microenvironmental factors: Company resources: The environment within which the marketing management must work involves the resources of the company and they are not endless.

Influences on the micro environmental -factors

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Resources are in terms of money, machinery ,equipments , buildings. These resources are important and if the opportunity arises to earn some extra profit company may be able to acquire extra resources: what is called Expansion Other type of resources is of course people-of all grades and types all of which add up to meet companys objectives

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Alternative view of the marketing Environment

Influences that will have a direct impact on the operating practices of a company: 1. Micro 2. Proximate Macro and 3. Macro

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Micro: influences strictly inside the organisation- staff, shareholders, production rates which largely controlled by the company but which will definitely affect operating practices e.g shareholders looking for increased return on Alternative view of the investment marketing Environment
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Proximate macro: influences such as competition, customers, suppliers, with the company deals with the day to day business and which may have an effect on the companys activities( e.g if a competitor changes is price structure, it may affect another company, which in turn could reduce prices or stop production

Alternative view of the marketing Environment

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Macro influences are the political , economic, social and technological changes which likely beyond the control of the company e.g changes in legislation on safety equipments may not impact immediately but will eventually lead the company either to conform or cease activities for certain products Alternative view of the

marketing Environment

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