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CH - 1- overview of marketing management for social studies and managment students.pptx
- 1. 1 Principles of Marketing CHAPTERONE Overview of Marketing and Marketing Management
- 2. 2 Introduction Even if thereare many factors (strategy, dedicated employees, good information systems, excellent implementation) that contribute to company’s success, today’s successful companies at all levels have common thing. • They are: Strongly customer-focused Heavily committed to marketing
- 3. • Reward ofany business organizations like: market share, profit, competitive advantage and survival come after customer care. • More than any other organizational function, marketing deals with customers. Sensing customers’ needs Serving customers’ needs Satisfying customers’ needs • Marketing is every where 3 Heart of all kinds of organization regardless of: • Large organization • Medium " • Small " • Profitable " • Non-profitable " • Service " • Charity " • School "
- 4. 4 Definition of Marketing Theold understanding of the term marketing is sale, i.e. telling and selling. However, selling is only one function of marketing. Selling is pushing the products to customers. In modern business understanding, marketing is satisfying customer needs. Marketing is serving customers profitably or managing profitable customer relationships. Broadly speaking, marketing is social and managerial process.
- 5. 5 Marketing as SocialProcess • Marketing is a societal process by which individuals and groups obtain what they need and want through creating, offering, and freely exchanging products and services value with others. Marketing as Managerial Process • Marketing is “the art of selling products.” with know and understand the customer well and that the product or service fits them. • Ideally, marketing should result in a customer who is ready to buy (Peter Drucker)
- 6. What is marketingmanagement • Marketing management is the process of planning and executing /implementing the conception, pricing, promotion, and distribution of ideas, goods, and services to create exchanges that satisfy individual and organizational goals. (The American Marketing Association) • Marketing management is essentially demand management. • Marketing management has the task of influencing the level, timing, and composition of demand in a way that will help the organization achieve its objectives. 6
- 7. • Marketing managementis the art and science of choosing target markets and getting, keeping, and growing customers through creating, delivering, and communicating superior customer value. Process of marketing management • Marketing can be defined as a process by which companies create value for customers and build strong customers relationships in order to capture value from customers in return. Marketing process has five steps: 7
- 8. 8 1. Understanding marketplaceand Customers’ needs, wants and demands 2. Designing customer-driven marketing strategies 3. Constructing an integrating marketing program that deliver superior value (consider 4P’s) 4. Building strong customer relationships 5. Capturing value from customers in return
- 9. Core Concepts ofMarketing 9 Needs, wants demands Markets Marketing & Marketers Exchange, Transaction Relationships products Utility, Value & Satisfaction
- 10. a) Needs: Ahuman need is a state of deprivation of basic satisfaction b) Wants: are desires for specific satisfiers of needs c) Demands: are wants for specific products that are backed by an ability and willingness to buy them. D) Products: a set of tangible and intangible attributes e) Value, Cost and Satisfaction Value: is the consumer’s estimate of the product’s overall capacity to satisfy his or her needs. Satisfaction is the result of the comparison of perceived (actual) performances and expectations. 10
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- 12. 12 f) Exchange andTransaction: Exchange: is the process of obtaining a desired product from someone by offering something in return A transaction is a trade of values between two or more parties. Transaction place, time, cost etc. g) Relationships and Networks • Relationship marketing has the aim of building mutually satisfying long term relations with key parties in order to earn and retain their business. • The ultimate outcome of relationship marketing is the building of a unique company asset called a marketing network.
- 13. 13 h. Market: consistsof all the existing and potential customers sharing a particular need or want who might be willing and able to engage in exchange to satisfy the need or want. i. Marketers and Prospects A marketer is someone seeking a response (attention, a purchase, a vote, a donation) from one or more prospects that might engage in exchange of values. A prospect is someone whom the marketer identifies as potentially willing and able to engage in an exchange. When both parties engage in the process actively the situation is reciprocal marketing. Marketer intention is selling while prospects is buying
- 14. 14 Importance of Marketing •Marketing Creates Utility • Marketing is Important Personal life • Marketing is Important to the Firm • Marketing affects standard of living and economic growth • Marketing is Important to the World Economy
- 15. 15 1. Marketing CreatesUtility Utility is the term used by economists to describe the level of satisfaction (happiness) that obtained from the consumption of a particular quantity of a commodity or undertaking an activity at a point of time. It is a base for consumers’ preference ordering. Together with production marketing supply different economic utility that provide customer satisfaction. These are: a) Form Utility: is related to the change of form of inputs to convert them in output. Production of something tangible. b) Task Utility: is provided when someone performs a task for someone else. c) Place Utility: The role of distribution in marketing is mostly attached with creating place utility d) Time Utility: It is created when products are available to customers, as they want. e) Possession Utility: As selling is one major activity in marketing, it creates possession utility by selling the products to the customers. (transfer of ownership)
- 16. 16 2. Marketing isImportant Personal life Through marketing activates individuals may get many befits such as knowledge & how and what to buy that is information about products, so that can live good standard of life or save money! 3. Marketing is Important to the Firm It is still the only revenue-generating department. It is the only function through which a firm collects money from others. The other functions incur cost.
- 17. 17 4. Marketing affectsstandard of living and economic growth It encourages research and innovation to better satisfy customers need. Competition drives price down. New goods, services and ideas that better satisfy the need. employment opportunities and carrier development for large number of people and they can acquire higher income.
- 18. 18 5. Marketing isImportant to the World Economy • Global (international) marketing facilitates the movement of goods and services and factors of production from one part of the world to the other and hence plays a great role in resources redistribution across the globe. Eg. Globalization, WTO
- 19. 19 State of Demand Thereare Different states of demand up on which the marketing manager has to deal by applying different strategies. These are: 1. Negative Demand: is when the major part of the market dislikes the product and even pay price to avoid it. Market strategy ( task)- Conversational marketing - Identify (analyze) why the market- dislike the product - Use different strategies to convince the market (buyers) and chant their beliefs and attitudes. 2. No Demand: this happens when the market is unaware of or un interested in the product of the company.
- 20. 20 Market strategy (task)stimulation marketing - Release information to increase general awareness of product - Relate the functions of the product with individual’s natural need. 3. Latent Demand ( Hidden Demand) - Happens when there is a demand for the product but the product doesn’t exist. Market strategy: Developmental Marketing - Measure the size of the potential market - Develop new and commercialize the products that satisfy these needs
- 21. 21 4. Decline Demand Thedemand for product declines after some time Market strategy- Remarking /Re stimulating -Analyze why demand declines -Find new target market, price reduction, applying more effective promotional packages 5. Irregular demand - Here demand for company’s product varies on certain time frame. - This causes idle or overworked capacity Market strategy synchronic marketing - is to find ways to alter the pattern of demand
- 22. 22 6. Full demand -Happens when demand level is the level that company wants to handle. - The actual demand is the level desired by the business firm. Marketing strategy/ Maintain Marketing Maintain the level of demand by measuring the satisfaction level of consumers along with quality controlling 7. Over full demand When demand is greater than what can be supplied or handled by company Marketing strategy- de marketing It is the techniques of reducing demand temporarily or permanently -Selective de marketing -General de marketing
- 23. 23 8. Un wholesome demand: A products is unwholesome/unpleasant. So the marketers discourage its demand or consumption. Marketing strategy Get people who like that product given it up by using fear message, price raise, reduce availability This is b/c the company has to work as per the regulation of the organized parties & at the same time does its business
- 24. Types of Markets Marketersclassify market into the following four groups 1. Consumer Markets – buy products for consumption. 2. Business Markets - buy goods to make or resell a product to others for a profit 3. Global Markets -buyers from different nations of the world. 4. Nonprofit and Governmental Markets e.g. Churches, charity, schools, etc. 24
- 25. 25 Scope of Marketing Whatis to be Marketed? Marketers marketed 10 different entities. 1. Goods : Physical things that have value to buyers. » E.g cars, refrigerators, televisions, machines, 2. Services: intangible things of value that can be offered to the market. – e.g. Services include the work of airlines, hotels, car rental firms, barbers and beauticians, maintenance and repair people 3. Events: Marketers promote time-based events, such as major trade shows, artistic performances 4. Experiences: company build experiences by producing a large number of products for a long time and market its experiences
- 26. 26 5. Persons: Artists,musicians, CEOs(head of company), physicians, high-profile lawyers and financiers, and other professionals are marketed themselves. E.g Saladin Seid 6. Places: Cities, states, regions, and whole nations compete to attract tourists, residents, factories, and company headquarters. 7. Properties: are intangible rights of ownership to either real property (real estate) or financial property (stocks and bonds). 8. Organizations: Organizations work to build a strong, favorable, and unique image in the minds of their target publics. 9. Information: Information is essentially what books, schools, and universities produce, market, and distribute at a price to parents, students, and communities. 10. Ideas: Every market offering includes a basic idea.
- 27. 27 Who Markets? • Marketersand prospects • A marketer is someone who seeks to sell something to other party called prospects. Prospects has no selling intention but buying intension. • Organization who tries to offer its products to customers is marketer. Marketing Management Philosophies • Marketers in the marketplace are guided by different ideas and principles. There are five organizational marketing orientation toward the marketplace.
- 28. 28 Marketing Management Philosophies Marketing management orientations are the basic orientations that help a given organization market its products and achieve its objectives. There are five alternative concepts under which organizations can do their marketing activities a) Production concept b) Product concept c) Selling concept d) Marketing concept e) Social marketing concept
- 29. 29 1. The productionConcept The production concept is oldest orientation which holds that consumers will favor products that are widely available and low in cost. Conditions under which the assumption holds true: • When demand for a product is greater than its supply • When unit cost of the product is high Mangers of production oriented organizations concentrate on achieving: high production efficiency wide distribution coverage
- 30. 30 2. The productconcept it holds that consumers will favor those products that offer the most quality, performance or innovative features. Mangers of these companies pay attention to produce superior quality products and improving it over time They will suffer from marketing myopia i.e. to give more attention to their products with out considering consumers’ interest.
- 31. 31 3. Selling concept Thisconcept assumes that consumers typically show buying inertia or resistance and they will not buy enough of the firm’s product unless extensive promotions made, and large scale selling goes or (aggressive selling and promotional effort undertaken) The concept is practically true • with unsought products. Eg. insurance/blood donation • When firms face overcapacity The selling concept states that firms sell what they make instead of making what is actually wanted in the market:
- 32. 32 4. The marketingconcept It holds that achieving organizational goals depends on determining the needs and wants of target markets and delivering the desired satisfactions more effectively then competitor do. There are four pillars under which marketing concept operate: a) Target market: Companies must define their target market carefully and prepare a tailored marketing program.
- 33. 33 b) Customer Needs:The key to this philosophy is to fully understand their customers real needs and meet them better than the competitor. c) Integrated Marketing: It means that all the different functions of the business must be tightly integrated to serve the interest of the customer as every function has a bearing on it. d) Profit making by satisfying customers The ultimate purpose of this concept is to help organizations achieve their goals.
- 34. 34 Comparison of theselling and marketing concepts Starting point Focus Means Ends Selling concept Factory Existing products Promoting and Selling Profit through sales volume Marketing concept Market Customer needs Integrated marketing Profit through customer satisfaction
- 35. 35 5. The socialMarketing concept It holds that the organization task is to determine the needs, wants, and internets of target market so as to deliver superior quality or value It questions whether the pure marketing concept overlooks possible conflict between consumer short-run wants and consumer long-run welfare. It maintains the balance between the society ( human welfare), consumer (wants satisfaction) and company ( profits)
- 36. 36 First Chapter hasCompleted