Ferrell Hirt Ferrell BUSINESS A CHANGING WORLD EIGHTH
Ferrell Hirt Ferrell BUSINESS A CHANGING WORLD EIGHTH EDITION FHF Mc. Graw-Hill/Irwin Copyright © 2011 by The Mc. Graw-Hill Companies, Inc. All rights reserved.
part Marketing: Developing Relationships 5 Chapter 11 Customer-Driven Marketing Chapter 12 Dimensions of Marketing Strategy Chapter 13 Digital Marketing and Social Networking FHF 11 -2
Marketing [ A group of activities designed to expedite transactions by creating, distributing, pricing and promoting goods, services and ideas ] Creates value by allowing individuals and organizations to obtain what they need and want FHF 11 -3
Marketing is NOT § Manipulating consumers § Just selling & advertising Marketing IS § A systematic approach to satisfying consumers FHF 11 -4
Exchange [ The act of giving up one thing (money, credit, labor, goods) in return (exchange) for something else (goods, services, ideas) ] FHF 11 -5
The Exchange Process FHF 11 -6
Functions of Marketing § § § § Buying Selling Transporting Storing Grading Financing Marketing research Risk-taking FHF 11 -7
Creating Value §A customer’s subjective assessment of benefits relative to costs in determining the worth of a product Øcustomer value = customer benefits – customer costs Benefits §Anything a buyer receives in an exchange Costs §Anything a buyer must give up to obtain the product’s benefits §Monetary costs and time and effort expended to procure the product FHF 11 -8
The Marketing Concept The idea that an organization should try to satisfy customers’ needs through coordinated activities that also allow it to achieve its own goals Ø Walmart’s slogan “Save Money, Live Better” FHF 11 -9
Customer-Contact Employees Must know what customers want § They are not selling goods and services, but: • Ideas • Benefits • Philosophies • Experiences Ø Customers’ perception of value = Level of success FHF 11 -10
Marketing Goals Customer satisfaction ü Achieve business objectives ü Boost productivity ü Reduce costs ü Capture market share FHF 11 -11
Evolution of the Marketing Concept Production Orientation § 19 th Century • Manufacturing efficiency Sales Orientation § Early 20 th Century • Supply exceeds demand; a need to “sell” products exists Market Orientation § 1950 s • First determine what customers want • New technologies are helping to improve communication and are helping companies learn what customers want FHF 11 -12
Market Orientation [ An approach requiring organizations to gather information about customer needs, share information across the firm and use information to build long-term relationships with customers ] FHF 11 -13
Marketing Strategy Ø A plan of action for developing, pricing, distributing and promoting products meeting the needs of specific customers The Oreo cookie § Market segmentation is geographic § Variations in the cookie recipe § Packaging may vary § Some countries pair the brand name with different company names § Promotions change based on cultural subtleties FHF 11 -14
Market Ø A group of people who have a need, purchasing power and the desire and authority to spend money on goods, services and ideas Target Market • A more specific group of consumers on whose needs and wants a company focuses its marketing efforts FHF 11 -15
Total-Market Approach Ø A firm tries to appeal to all consumers and assumes that they all have similar needs § Salt, sugar, flour and white bread are all examples of products that typically are sold using a total market approach FHF 11 -16
Market Segmentation Ø A strategy to divide the total market into groups of people with relatively similar product needs Market Segment § A collection of individuals, groups, or organizations sharing one or more characteristics, thus having relatively similar needs and desires for products FHF 11 -17
Segmentation Approaches Concentration Approach § A market segmentation strategy whereby a company develops one marketing strategy approach for a single market segment Multisegment Approach § A market segmentation strategy whereby a company aims its efforts at two or more segments, developing a marketing strategy for each FHF 11 -18
Target Market Strategies FHF 11 -19
Bases for Market Segmentation § § Demographic Geographic Psychographic Behavioristic FHF 11 -20
Developing the Marketing Mix FHF 11 -21
Product [ A good, service, or idea that has tangible and intangible attributes that provide satisfaction and benefits to consumers ] FHF 11 -22
Price [ A value placed on a product or service that is exchanged between a buyer and seller ] FHF 11 -23
Distribution [ Making products available to consumers in the quantities and locations desired ] FHF 11 -24
Promotion [ A persuasive form of communication that attempts to expedite a marketing exchange by influencing individuals and organizations to accept goods, services and ideas ] FHF 11 -25
Marketing Research Ø Systematic and objective process to collect information about potential customers § Guides marketing decisions § May include data on age, income, ethnicity, educational level, etc. of the target market and how frequently they purchase the product FHF 11 -26
Marketing Information Systems Ø A framework for accessing information about customers from sources inside and outside the organization § Inside the organization: • Continuous flow of information on prices, sales and expenses § Outside the organization: • Data are available through public and private reports, census statistics, digital media sources, etc. FHF 11 -27
Collecting Data Primary Data § Marketing information that is observed, recorded or collected directly from respondents (consumers) Secondary Data § Information compiled inside or outside the organization for some purpose other than changing the current situation FHF 11 -28
Online Marketing Research New information technologies are changing how businesses learn about consumers and market their products § Digital media and online social networks § Opportunity to reach new markets via the Internet Virtual Testing § Interactive multimedia research that combines sight, sound animation to improve testing of products and their features FHF 11 -29
Buying Behavior [ Decision processes and actions of people who purchase and use products ] FHF 11 -30
Psychological Variables for Buying Behavior Perception § Process by which a person selects, organizes and interprets information received from one’s senses (hearing a radio ad, touching a product) Learning § Brings changes in behavior based on information and experience Attitude § Positive or negative feelings about something Personality § Individuals’ distinguishing character traits, attitudes, or habits FHF 11 -31
Social Variables for Buying Behavior Social Roles § Set of expectations of individuals based on some position they occupy Reference Groups § Groups with whom buyers identify and whose values or attitudes they adopt Social Classes § Ranking of people into higher or lower positions of respect Culture § Integrated, accepted pattern of behavior including thought, speech, beliefs, actions and artifacts FHF 11 -32
Understanding Buying Behavior Trying to understand consumers is the best way to satisfy them Ø No exact tools FHF 11 -33
The Marketing Environment External forces that directly and indirectly affect marketing strategy § § Political, legal and regulatory forces Social forces Competitive and economic forces Technological forces FHF 11 -34
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