Copyright 2010 by Cengage Learning Inc All Rights Reserved 1 What is Marketing What is Marketing A Philosophy An Attitude A Perspective A Management Orientation A Set of Activities ID: 669510
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Slide1
Chapter 1: An Overview of Marketing
Copyright 2010 by
Cengage Learning Inc. All Rights Reserved
1Slide2
What is Marketing?Slide3
What is Marketing?
A Philosophy
An Attitude A Perspective
A Management Orientation
A Set of Activities
Products
Distribution
PromotionPricing
AMA: 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.Slide4
Exchange
At Least Two Parties
Something of Value
Communication and Delivery
Freedom to Accept or Reject
Desire to Deal with Other Party
Conditions for Exchange
People giving up something to receive something they would rather have.Slide5
What
is Marketing?
Product
Price
Place
Promotion
Exchange
A B
Delivering
Value
Communicating
Value
Creating
Value
Customer value
and beneficial
relationshipsSlide6
The
Four Marketing Management Philosophies
Production
Sales
Marketing
Societal
What can we make or do best?
How can we sell more aggressively?
What do
customers want
and need?
What do customers want and need, and how can we benefit society?
Orientation
FocusSlide7
Achieving a Marketing Orientation
Obtain information about customers, competitors, and markets
Examine the information from a total business perspective
Determine how to deliver superior customer valueImplement actions to provide value to customersSlide8
Customer Value Requirements
Offer products that perform
Earn trustAvoid unrealistic pricing
Give the buyer factsOffer organization-wide commitment in
service and after-sales support
Co-CreationSlide9
Sales
vs. Marketing Orientations
Organization’s
Focus
Firm’s
Business
For
Whom?
Primary
Profit
Goal?
Tools to Achieve
Selling
goods and services
Everybody
Maximum sales volume
Primarily promotion
Inward
Sales Orientation:
Market Orientation:
Outward
Coordinated
use of all marketing activities
Customer satisfaction
Specific groups of people
Satisfying wants and needsSlide10
Why Study Marketing?Slide11
Why Study Marketing?
Plays an important role in society
Vital to business survival, profits and growthOffers career opportunities
Affects your life every daySlide12
Chapter 2: Strategic Planning for Competitive Advantage
Copyright 2012 by Cengage Learning Inc. All Rights Reserved
12Slide13
The Nature of Strategic Planning
Understand the importance
of strategic marketing and know a basic outline for a marketing plan.Slide14
Strategic Planning
The managerial process of creating and
maintaining a fit between the organization’s objectives and resources and evolving market opportunities.The goal is long-term profitability and growth.Slide15
Why Write a Marketing Plan?
LO
I
Provides a basis for comparison of
actual and expected performance
Provides clearly stated activities to
work toward common goals
Serves as a reference for the success of
future activities
Provides an examination of the marketing
environment
Allows entry into the marketplace with
awarenessSlide16
Marketing Plan ElementsSlide17
Defining the Business Mission
Answers the question, “What business are we in?”
Focuses on the market(s) rather than the good or serviceStrategic Business Units (SBUs) may also have a mission statementSlide18
Southwest Airlines Mission Statement
Source:
http://www.southwestairlines.com/about_swa/missionSlide19
Strategic Business Units (SBUs)
Characteristics:An SBU HAS…
A distinct mission and specific target marketControl over its resourcesIts own competitorsPlans independent of other SBUsSlide20
SWOT Analysis
©South-Western College Publishing
S
W
O
T
Things the company does well.
Things the company does not do well.
Conditions in the external environment that favor strengths.
Conditions in the external environment that do not relate to existing strengths or favor areas of current weakness.
Internal
ExternalSlide21
Scanning the Marketing Environment
The process of continually acquiring/interpreting
info on the events occurring outside the organization to identify and interpret potential trends.Slide22
Scanning the Marketing Environment Slide23
Marketing Objectives
Realistic
Measurable
Time specific
Compared to a
benchmark
“
Our objective is to increase sales of Purina brand cat food by 15 percent over 2009 sales of $300 million.”Slide24
Criteria
for Good Marketing Objectives
Realistic, measurable, and time-specific objectives consistent with the firm’s objectives:
1. Communicate marketing management philosophy
2. Provide management direction
3. Motivate employees
4. Force executives to think clearly
5. Allow for better evaluation of resultsSlide25
Competitive
Advantage
Niche Strategies
Cost
Product/Service Differentiation
Types of Competitive Advantage
The set of unique features of a company and its products that are perceived by the target market as significant and superior to the competition.Slide26
Cost Competitive
Advantage
Being the low-cost competitor in an industry while maintaining satisfactory profit margins.
Obtain inexpensive raw materialsCreate efficient plant operations
Design products for ease of manufacture
Control overhead costs
Avoid marginal customersSlide27
Sources of Cost Reduction
Experience Curves
Efficient Labor
No-frills Goods and
Services
Government Subsidies
Product Design
Reengineering
Production Innovations
New Service
Delivery MethodsSlide28
Product/Service Differentiation
The provision of something that is unique and valuable to buyers beyond simply offering a lower price than the competition’s.Brand namesStrong dealer network
Product reliabilityImageServiceSlide29
Niche Competitive Advantage
Used by small companies with limited resources
May be used in a limited geographic marketProduct line may be focused on a specific product categorySlide30
Sources of
Sustainable Competitive Advantage
Patents
Copyrights
Locations
Equipment
Technology
Customer Service
Promotion
Skills and Assets
of an
Organization
Slide31
Sources
of Competitive Advantage
Sources of
Competitive Advantage
Cost
$
Product/Service
Differentiation
A
vs.
B
vs.
C
Niche
StrategiesSlide32
StrategySlide33
Ansoff’s Strategic Opportunity Matrix
Present Product
New Product
New
Market
Market
Penetration
Market
Development
Product
Development
Diversification
Present
MarketSlide34
Strategic Alternatives
Market
Penetration
MarketDevelopment
Product Development
Diversification
Increase market share among
existing customers
Attract new customers to
existing products
Introduce new products
into new markets
Create new products for
present marketsSlide35
Setting Strategic Direction
Where are we now?Where do we want to go?Slide36
Setting Strategic Direction – Where are we now?
CustomersCompetencies
CompetitorsBusiness sectorsSWOT analysisEnvironmental scanningSlide37
Setting Strategic Direction – Where are we now?
Competencies – an organization’s special capabilities, including skills, technologies, and resources that distinguish it from other organizations
Competitive advantage – a unique strength relative to competitors, often based on quality, time, cost, or innovationBenchmarking – discovering how others do something better than your own firm, so you can imitate or leapfrog competition. Studying operations in completely different businesses.Slide38
Setting Strategic Direction – Where do we want to go?
Growth strategies
Portfolio analysisMarket growth rate versus market share
Market-Product analysisAnalyze current and new products and marketsSlide39
Critical Factors for Success
Customer relationships (value)Innovation (new and unique value)Quality
EfficiencySlide40
Strategic Marketing Process
The activities of selecting and describing one or more target markets and developing and maintaining a market mix that will produce mutually satisfying exchanges with target markets.Slide41
Target Market Strategy
Segment the market based on groups with similar characteristics
Analyze the market based on attractiveness of market segmentsSelect one or more target marketsSlide42
Target Market Strategy
Appeal to the entire market
with one marketing mix
Concentrate on one marketing segment
Appeal to multiple markets
with multiple marketing mixesSlide43
Segmentation
Defining markets
Dimensions to use
Identifying segments
Identifying segments to target
Segmentation approaches
Positioning
Understanding customer’s view
Positioning techniques
Evaluating segment preferences
Differentiating the marketing mix
Relationship between
positioning & targeting
Focusing Marketing Strategy with Segmentation and PositioningSlide44
Market Segmentation
Involves aggregating prospective buyers into groups thatHave common needs, andWill respond similarly to a marketing actionSlide45
Product Segmentation
Using different marketing mix activities (features and advertising) to demonstrate perceive differences against competing products/brandsA firm selling two or more products with different features targeted to different market segments.Good – Better – Best
Cost – Value – Premium Slide46
5 Steps to Segmenting Markets
Form prospective buyers into segmentsForm products to be sold into groupsDevelop a market product grid and estimate size of marketSelect target marketsDesign marketing activities to each target marketSlide47
Criteria for Forming Segments
Potential for increased profit/ROISimilarity of needsDifference of needsFeasibility of marketing action to reach the targeted segmentSimplicity of cost of assigning potential buyers to a segmentSlide48
Ways to Segment Consumer Markets
Customer CharacteristicsGeographicDemographic
SocioeconomicPsychographicBuying SituationsOutlet typeBenefits soughtUsageAwareness and intentions
Behavior Slide49
Ways to Segment Consumer MarketsSlide50
Broad product-market (or generic market) name goes here (The bicycle-riders product-market)
Submarket 1
(Exercisers)
Submarket 2
(Off-road
adventurers)
Submarket 3
(Transportation riders)
Submarket 4
(Socializers)
Submarket 5
(Environmentalists)
Market Segmentation Defines Possible Target MarketsSlide51
Behavioral dimensions for segmenting consumer markets
Benefits soughtThoughtsRate of use
Type of problem solvingRate of useInformation requiredBrand familiarityPurchase relationshipKind of shoppingNeeds Slide52
Segmenting business markets
Kind of relationshipPurchasing methodsType of customerSegmentationType of buying situation
How customers will use the productSlide53
Marketing Mix – 4P’s Slide54
Marketing Mix: The “Four Ps”
The starting point of the
“4 Ps”
IncludesPhysical unit
Package
Warranty
Service
Brand
Image
Value
Product
Products can be…
Tangible goods
Ideas
ServicesSlide55
Marketing Mix: The “Four Ps”
Product availability where and when customers want them
All activities from raw materials to finished products
Ensure products arrive in usable condition at designated places when needed
PlaceSlide56
Marketing Mix: The “Four Ps”
Promotion
Role is to bring about exchanges with target markets by:
Informing
Educating
Persuading
Reminding
Includes integration of:
Personal selling
Advertising
Sales promotion
Public relationsSlide57
Marketing Mix: The “Four Ps”
Price
Price is what a buyer must
give up to obtain a product.
The most flexible of the
“4 Ps”-- quickest to change
Competitive weapon
Price x Units Sold = Total RevenueSlide58
Strategic Marketing ProcessSlide59
Following Up the Marketing Plan
Implementation EvaluationControl
Marketing audit is…ComprehensiveSystematicIndependentPeriodicSlide60
Effective Strategic Planning
Effective Strategic Planning requires…Continual attention – ongoing rather than annual
Creativity – challenging assumptionsManagement Commitment – support and participation from the topSlide61
Chapter 3: Ethics and Social ResponsibilitySlide62
Civil Society
Six Modes of Social Control
Ethics
Laws
Formal and Informal Groups
Self Regulation
The Media
Active Civil SocietySlide63
Ethical Behavior
63
Ethics
The moral principles or values that generally govern the conduct of an individual.
People usually base their individual choice of ethical theory on their life experiences
Deontology
Utilitarianism
Casuist
Moral Relativists
Virtue EthicsSlide64
Ethical Decision Making
Influential Factors
Extent of Problems
Top Management
Actions
Potential Consequences
Social Consensus
Probability of Harm
Time Until
Consequences
Number AffectedSlide65
Code of Ethics
Code of Ethics- A guideline to help
marketing managers and other employees make better decisions.Slide66
Creating Ethical Guidelines
Helps identify acceptable business practices
Helps control behavior internally Avoids confusion in decision makingFacilitates discussion about right and wrong Slide67
Ethical Guidelines and Training
Exhibit 3.3Slide68
Arguments for Social ResponsibilitySlide69
Corporate Social Responsibility
Stakeholders
Employees
Management
Customers
Local Community
Suppliers
OwnersSlide70
Sustainability
70
The idea that socially
responsible companies will
outperform their peers by
focusing on the world’s social
problems and reviewing
them as opportunities to build
profits and help the
world at the same time.Slide71
Cause-Related Marketing
The cooperative efforts of a “for-profit” firm and a “non-profit” organization for mutual benefit.
“
Five Questions to Ask Before Participating in a Cause-Related Marketing Program”
Is this company committed?
How is the program structured?
Who does the program benefit?
How will the organization that benefits use my money?
Is the program meaningful to me?