Marketing Management
Fifteenth Edition
Chapter 1
Defining
Marketing for the
New Realities
Copyright © 2016, 2012, 2009 Pearson Education, Inc. All Rights Reserved
Learning Objectives
1.1 Why is marketing important?
1.2 What is the scope of marketing?
1.3 What are some core marketing concepts?
1.4 What forces are defining the new marketing
realities?
1.5 What new capabilities have these forces
given consumers and companies?
1.6 What does a holistic marketing philosophy
include?
1.7 What tasks are necessary for successful
marketing management?
Copyright © 2016, 2012, 2009 Pearson Education, Inc. All Rights Reserved
Copyright © 2016, 2012, 2009 Pearson Education, Inc. All Rights Reserved
Copyright © 2016, 2012, 2009 Pearson Education, Inc. All Rights Reserved
The Value of Marketing
• Financial success often depends on marketing
ability
• Successful marketing builds demand for
products and services, which, in turn, creates
jobs
• Marketing builds strong brands and a loyal
customer base, intangible assets that
contribute heavily to the value of a firm
Copyright © 2016, 2012, 2009 Pearson Education, Inc. All Rights Reserved
The Scope of Marketing
• Marketing is about identifying and meeting human
and social needs
• AMA’s formal 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
Copyright © 2016, 2012, 2009 Pearson Education, Inc. All Rights Reserved
Marketing Management
• The art and science of choosing target markets and
getting, keeping, and growing customers through
creating, delivering, and communicating superior
customer value
Copyright © 2016, 2012, 2009 Pearson Education, Inc. All Rights Reserved
What is Marketed? (1 of 2)
• Goods
• Services
• Events
• Experiences
• Persons
Copyright © 2016, 2012, 2009 Pearson Education, Inc. All Rights Reserved
What is Marketed? (2 of 2)
• Places
• Properties
• Organization
s
• Information
• Ideas
Copyright © 2016, 2012, 2009 Pearson Education, Inc. All Rights Reserved
Who Markets?
• A marketer is someone who seeks a response—
attention, a purchase, a vote, a donation—from
another party, called the prospect
Copyright © 2016, 2012, 2009 Pearson Education, Inc. All Rights Reserved
8 Demand States
• Negative: Dental work, insurance, body checkups
• Nonexistent: unaware or uninterested like courses, offer
• Latent: strong need but existing product unsatisfactory. Say
hybrid car, smartphone
• Declining: DVD, Walkman
• Irregular: Seasonal, weekly, monthly
• Unwholesome: attracted to undesirable product. Tobacco,
guns, alcohol
• Full: Demand = supply, ideal scenario
• Overfull: Limited product but high demand
Copyright © 2016, 2012, 2009 Pearson Education, Inc. All Rights Reserved
Figure 1.1 Structure of Flows in a
Modern Exchange Economy
Copyright © 2016, 2012, 2009 Pearson Education, Inc. All Rights Reserved
Core Marketing Concepts (1 of 10)
• Needs: the basic human requirements such as for air,
food, water, clothing, and shelter
• Wants: specific objects that might satisfy the need
• Demands: wants for specific products backed by an
ability to pay
Copyright © 2016, 2012, 2009 Pearson Education, Inc. All Rights Reserved
Types of Needs
• Stated
• Real
• Unstated
• Delight
• Secret
Copyright © 2016, 2012, 2009 Pearson Education, Inc. All Rights Reserved
The New Marketing Realities
• Technology: Social media (backlash), targeted ads,
mobile marketing, etc
• Globalization: Sharing of business models: Grameen
microcredit, technology, labor, resources
• Social responsibility: Gaza war awareness
Copyright © 2016, 2012, 2009 Pearson Education, Inc. All Rights Reserved
A Dramatically Changed
Marketplace (1 of 6)
• New consumer capabilities
– Can use the internet as a powerful information and
purchasing aid
– Can search, communicate, and purchase on the move
– Can tap into social media to share opinions and
express loyalty
Copyright © 2016, 2012, 2009 Pearson Education, Inc. All Rights Reserved
A Dramatically Changed
Marketplace (2 of 6)
• New consumer
capabilities
– Can actively interact with
companies
– Can reject marketing
they find inappropriate
Copyright © 2016, 2012, 2009 Pearson Education, Inc. All Rights Reserved
A Dramatically Changed
Marketplace (3 of 6)
• New company capabilities
– Can use the internet as a powerful information and
sales channel, including for individually differentiated
goods
– Can collect fuller and richer information about markets,
customers, prospects, and competitors
– Can reach customers quickly and efficiently via social
media and mobile marketing, sending targeted ads,
coupons, and information
Copyright © 2016, 2012, 2009 Pearson Education, Inc. All Rights Reserved
A Dramatically Changed
Marketplace (4 of 6)
• New company capabilities
– Can improve purchasing, recruiting, training, and
internal and external communications
– Can improve cost efficiency
Copyright © 2016, 2012, 2009 Pearson Education, Inc. All Rights Reserved
Marketing in Practice
• Marketing balance: Readiness to change and adapt to
innovate new products, connect with customer,
incorporate digital efforts, seek new advantages
• Marketing accountability: Justify return on marketing
investment by incorporating metrics like customer
lifetime value, brand equity, profitability
• Marketing in the organization
Copyright © 2016, 2012, 2009 Pearson Education, Inc. All Rights Reserved
Company Orientation Toward the
Marketplace
Copyright © 2016, 2012, 2009 Pearson Education, Inc. All Rights Reserved
Figure 1.4 Holistic Marketing
Dimensions
Copyright © 2016, 2012, 2009 Pearson Education, Inc. All Rights Reserved
Relationship Marketing
• Customers
• Employees
• Marketing partners
• Financial community
Copyright © 2016, 2012, 2009 Pearson Education, Inc. All Rights Reserved
Integrated Marketing
• Devise marketing activities and programs that create,
communicate, and deliver value such that “the whole
is greater than the sum of its parts.”
Copyright © 2016, 2012, 2009 Pearson Education, Inc. All Rights Reserved
Internal Marketing
• The task of hiring, training, and motivating able
employees who want to serve customers well
Copyright © 2016, 2012, 2009 Pearson Education, Inc. All Rights Reserved
Performance Marketing
• Financial accountability
• Environmental impact
• Social impact
Performance marketing requires understanding the
financial and nonfinancial returns to business and
society from marketing activities and programs.
Copyright © 2016, 2012, 2009 Pearson Education, Inc. All Rights Reserved
Figure 1.5 Marketing Mix
Components (4 Ps)
Copyright © 2016, 2012, 2009 Pearson Education, Inc. All Rights Reserved
Modern Marketing Management
• People
• Processes
• Programs
• Performance
Copyright © 2016, 2012, 2009 Pearson Education, Inc. All Rights Reserved
Figure 1.6 The Evolution of Marketing
Management
Copyright © 2016, 2012, 2009 Pearson Education, Inc. All Rights Reserved
