Intro to Business 7 e CHAPTER 10 Marketing

Intro to Business, 7 e CHAPTER 10 Marketing 10 -1 Marketing Basics 10 -2 Develop Effective Products and Services 10 -3 Price and Distribute Products 10 -4 Plan Promotion © 2009 South-Western, Cengage Learning SLIDE 1

Intro to Business, 7 e 10 -1 Marketing Basics Goals l Define important marketing concepts. l Identify the steps in a marketing strategy. l Describe the consumer decision-making process. © 2009 South-Western, Cengage Learning SLIDE 2

Intro to Business, 7 e Chapter 10 Key Terms l marketing strategy l target market l marketing mix l marketing orientation l final consumers l business consumers l consumer decisionmaking l process l buying motives © 2009 South-Western, Cengage Learning SLIDE 3

Intro to Business, 7 e UNDERSTAND MARKETING Chapter 10 l Marketing activities l Marketing

Intro to Business, 7 e Chapter 10 Marketing Functions © 2009 South-Western, Cengage Learning

Intro to Business, 7 e Chapter 10 Checkpoint >> Define marketing and the seven marketing functions. Answer l Marketing is an organizational function and a set of processes for creating, communicating, and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders. l The seven marketing functions include product and service management, distribution, selling, marketing information management, financial analysis, pricing, and promotion. © 2009 South-Western, Cengage Learning SLIDE 6

Intro to Business, 7 e Chapter 10 MARKETING STRATEGY l Marketing planning l Develop a successful marketing strategy l Identify a target market l Create a marketing mix © 2009 South-Western, Cengage Learning SLIDE 7

Intro to Business, 7 e Chapter 10 TARGET MARKET l Specific group of consumers who have similar needs and wants l Proctor & Gamble l http: //www. pg. com/en_US/index. shtml © 2009 South-Western, Cengage Learning SLIDE 8

Intro to Business, 7 e Chapter 10 l http: //www. esmalloffice. com/SBR_templ ate. cfm?

Intro to Business, 7 e Chapter 10 MARKETING MIX l PRODUCT- includes the basic (or simplest form) product, features, options, brand name, packaging guarantee/warranty, l PRICE- the $ a customer must pay for a product or service l PLACE- distribution (channels of distribution) and placement l PROMOTION- promotion, personal selling, and advertising © 2009 South-Western, Cengage Learning SLIDE 10

Intro to Business, 7 e Chapter 10 Checkpoint >> What are the two steps in developing a marketing strategy? Answer l 1. Identify your target market l 2. Develop your marketing mix. © 2009 South-Western, Cengage Learning SLIDE 11

Intro to Business, 7 e UNDERSTAND CUSTOMERS Chapter 10 l Consumer decision-making (next slide) l Buying motives l Emotional l Purchases based on feelings, beliefs, and attitudes l Rational l Purchase decisions guided by facts and logic © 2009 South-Western, Cengage Learning SLIDE 12

Intro to Business, 7 e STEPS IN THE CONSUMER DECISION-MAKING PROCESS 1. 2. 3. 4. 5. Chapter 10 Recognize a need. Gather information. Select and evaluate alternatives. Make a purchase decision. Determine the effectiveness of the decision. © 2009 South-Western, Cengage Learning SLIDE 13

Intro to Business, 7 e Chapter 10 Assessment page 242>> 1 -3, and 4 or 5 Then read Chapter 10 -2 starting on page 243 and complete questions on page 248 (1 -3, and 4 or 5) © 2009 South-Western, Cengage Learning SLIDE 14

Intro to Business, 7 e 10 -2 Develop Effective Products and Services Goals l Justify the importance of marketing research. l Identify the components of a product. l Describe how services differ from products. © 2009 South-Western, Cengage Learning SLIDE 15

Intro to Business, 7 e Chapter 10 Key Terms l marketing research l product

Intro to Business, 7 e CREATE AND IMPROVE PRODUCTS Chapter 10 l Totally new products l Major improvements in existing products l Minor improvements in existing products © 2009 South-Western, Cengage Learning SLIDE 17

Intro to Business, 7 e PLAN MARKETING RESEARCH Chapter 10 Steps in marketing research 1. Define the marketing problem. 2. Study the situation. 3. Develop a data collection procedure. 4. Gather and analyze information. 5. Propose a solution. © 2009 South-Western, Cengage Learning SLIDE 18

Intro to Business, 7 e TYPES OF RESEARCH STUDIES Chapter 10 l. Secondary Research. Analyzing existing information gathered for another purpose and using it to solve a current problem l. Primary Research. Studies carried out to gather new information specifically directed at a current problem (continued on following slide) © 2009 South-Western, Cengage Learning SLIDE 19

Intro to Business, 7 e TYPES OF RESEARCH STUDIES (Primary Research) Chapter 10 l

Intro to Business, 7 e Chapter 10 Check out these examples… l http: //www. fastcompany. com/magazine/ 05/elab. html l http: //www. youtube. com/watch? v=o. Bai Ks. YUdvg l http: //online. wsj. com/article/SB 1219275 08211958397. html © 2009 South-Western, Cengage Learning SLIDE 21

Intro to Business, 7 e Chapter 10 Checkpoint >> List the steps in a marketing research study. Answer l The steps in marketing research are to define the marketing problem, study the situation, develop a data collection procedure, gather and analyze information, and propose a solution. © 2009 South-Western, Cengage Learning SLIDE 22

Intro to Business, 7 e Chapter 10 PRODUCT PLANNING l Parts of a product l l l Basic Product Features (Options) Brand Name Packaging Guarantee or Warranty © 2009 South-Western, Cengage Learning SLIDE 23

Intro to Business, 7 e Chapter 10 PRODUCT PLANNING l Product planning procedures l l l Idea development Idea screening Strategy development Production and financial planning Limited production and test marketing Full-scale production © 2009 South-Western, Cengage Learning SLIDE 24

Intro to Business, 7 e Chapter 10 Checkpoint >> What are the components of a product? Answer l Products are everything businesses offer to customers and are composed of the basic product, product features, its brand name and packaging, and sometimes a guarantee or warranty. © 2009 South-Western, Cengage Learning SLIDE 25

Intro to Business, 7 e Chapter 10 SERVICES l Intangible l No tangible form l Inseparable l Consumed at the time they are produced l Perishable l Cannot be stored for later use l Heterogeneous l Differences in the type and quality of services provided © 2009 South-Western, Cengage Learning SLIDE 26

Intro to Business, 7 e Chapter 10 Checkpoint >> In what ways are services different from products? Answer l Products are tangible and may be nonperishable; it is generally easier to control the quality and marketability of these items. l Services, however, are intangible, more difficult to market, and perishable. © 2009 South-Western, Cengage Learning SLIDE 27

Intro to Business, 7 e 10 -3 Price and Distribute Products Goals l Discuss how the selling price of a product is calculated. l Differentiate between a direct and an indirect channel of distribution. © 2009 South-Western, Cengage Learning SLIDE 28

Intro to Business, 7 e Chapter 10 Key Terms l price l distribution l

Intro to Business, 7 e Chapter 10 VALUE AND PRICE l Buyers usually want to pay the lowest price possible. l Sellers want to charge the highest price possible. © 2009 South-Western, Cengage Learning SLIDE 30

Intro to Business, 7 e Chapter 10 PRICING FACTORS l Supply and demand l

Intro to Business, 7 e Chapter 10 PRICE A PRODUCT l Selling price l Product costs l Operating expenses l Profit l Gross margin Gross Selling Product = + Margin price costs Selling Product Operating = + + Profit price costs expenses © 2009 South-Western, Cengage Learning SLIDE 32

Intro to Business, 7 e Chapter 10 PRICE A PRODUCT l Markup l Markdown

Intro to Business, 7 e Chapter 10 Checkpoint >> What is the formula for calculating the selling price of a product? Answer Selling price = Product cost + Operating expenses + Profit. © 2009 South-Western, Cengage Learning SLIDE 34

Intro to Business, 7 e CHANNELS OF DISTRIBUTION Chapter 10 l Need for distribution channels l l Differences in quantity Differences in assortment Differences in location Differences in timing l Channels and channel members © 2009 South-Western, Cengage Learning SLIDE 35

Intro to Business, 7 e Chapter 10 Checkpoint >> What is the difference between a direct and an indirect channel of distribution? Answer l In a direct channel of distribution, products move directly from the producer to the consumer. l In an indirect channel, others may participate in the movement of products from the producer to the consumer, such as transportation services and retailers. © 2009 South-Western, Cengage Learning SLIDE 36

Intro to Business, 7 e Chapter 10 Reinforcements l. Page 242 l. Page 247

Intro to Business, 7 e 10 -4 Plan Promotion Goals l Justify the importance of communication in marketing. l Identify and describe the common types of promotion. © 2009 South-Western, Cengage Learning SLIDE 38

Intro to Business, 7 e Key Terms Chapter 10 l Promotion ~ any form of communication use to inform, persuade, or remind. l Effective communication ~ exchange of information so there is common understanding by all participants. l Personal selling ~ direct, individualized communication withy prospective customers to assess their needs and assist them in satisfying those needs with appropriate products and services. l Advertising ~ any paid form of communication through mass media directed at identified consumers to provide information and influence their actions. © 2009 South-Western, Cengage Learning SLIDE 39

Intro to Business, 7 e Chapter 10 COMMUNICATION l The communication process l Communicating through promotion – p. 256 How does identifying a target market improve promotion communications? © 2009 South-Western, Cengage Learning SLIDE 40

Intro to Business, 7 e Chapter 10 Components of Effective Communication © 2009 South-Western,

Intro to Business, 7 e Chapter 10 Checkpoint >> How does identifying a target market improve promotion communications? Answer l Communication can be developed and directed more specifically if a target market is identified. © 2009 South-Western, Cengage Learning SLIDE 42

Intro to Business, 7 e A QUESTION OF ETHICS on page 258 Chapter 10 l The Price of Success l A MICROSOFT CASE STUDY l l l http: //www. nytimes. com/2007/09/17/technology/17 cndsoft. html? ex=1347681600&en=d 16802 a 6603 d 512 f&ei=5088&partner=rssnyt&emc=rss http: //www. computerworld. com/s/article/9103578/For_Bill_Gates_antitrust_fight_was_a_personal_c rucible http: //en. wikipedia. org/wiki/Bill_Gates © 2009 South-Western, Cengage Learning SLIDE 43

Intro to Business, 7 e Chapter 10 PROMOTION l Personalized promotion l Direct communication w/ customer l Tailors information for that customer l a. k. a. Personal Selling l Mass promotion l Communicates with many people at the same time l Common message l More info on next slide © 2009 South-Western, Cengage Learning SLIDE 44

Intro to Business, 7 e Chapter 10 PROMOTION l Mass Promotion (continued) l Advertising~ pd communication through mass media to influence the public l Publicity~ non-paid promotion l Public Relations~ ongoing program of pd and non-pd communications. Planned to favorably influence public opinion l Sales Promotions ~activities and materials designed to reinforce a company’s brand or image © 2009 South-Western, Cengage Learning SLIDE 45

Intro to Business, 7 e Chapter 10 PROMOTION l Mass personalization l Combines the advantages of personal selling and mass promotion l Begins as mass promotion and then invites prospective customers to call, write, or go online, for a more personal analysis of their needs. © 2009 South-Western, Cengage Learning SLIDE 46

Intro to Business, 7 e Chapter 10 Checkpoint >> Describe the advantages and disadvantages of the major types of promotion. Answer l Personalized promotion allows the provider to meet customers and identify customer needs. l It is, however, the most expensive type of promotion. l Mass promotion reaches a larger target market and is much less expensive. l It does not, however, provide for individualized service, and sales (results) are often not immediate. © 2009 South-Western, Cengage Learning SLIDE 47