What is Marketing You TRADE your catering abilities

What is Marketing?

You TRADE your catering abilities FOR [in exchange] your house to be painted. Exchange [also referred to as bartering] A person fixes your driveway. IN EXCHANGE You chop his firewood.

Exchanges Take Place Every Day Getting a haircut Purchasing a pair of shoes Visiting the dentist Having surgery Taking a cruise Buying a dress Buying a hamburger Getting a massage

MARKETING “The process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods, and services to create exchanges that satisfy individual and organizational objectives. ” [American Marketing Association]

It is a process. It involves. . . planning pricing promoting distribution

Marketing is the connecting link or bridge between the producer and the consumer TO PRODUCER CONSUMER

Marketing Is All Around Us

What is Marketed? . . Durable goods Nondurable goods Desks Telephone Houses Services Banking Travel agencies Bridal consultants Organizations NCAA Labor unions Art museums continued Food items Office Supplies Light Bulbs People Ideas Rock stars Athletes Movie stars “Pitch in!” “Buckle up for safety. ” “Fight birth defects. ” Places “Take your vacation in Jamaica. ” “Locate your plant in Laurinburg, NC. ” “Honeymoon in Hawaii. ”

What is Marketed? Durable goods Services Organizations Non-durable goods People Ideas Places

Marketing Concept A philosophy about the way in which business should be conducted To succeed in business, management must base their decisions on the needs and desires of consumers GIVE CONSUMERS WHAT THEY WANT.

Elements of the Marketing Concept 1 Customer orientation 2 Company commitment 3 Company goals

Element 1: Customer Orientation American businesspeople recognize several factors about production and consumption. For Example: 1. They can product more that consumers demand. 2. Consumers are better educated, have more leisure time, are mobile, and are able to shop around more than before. 3. Consequently, businesses must compete to get people to buy their products or services. 4. Their problem is not how to produce more items but, rather how to produce items that people want and how to sell them more effectively.

Element 1: Customer Orientation. . . continued They have found that it is just plain, good business to base their decision-making on customer needs and wants. 1. Much better to determine what customers want and offer that than to develop or manufacture an item and then try to sell it to someone. 2. According to an executive from General Foods: “Instead of trying to market what is easiest for us to make, we must find out much more about what the consumer is willing to buy. In other words, we must apply our creativeness more intelligently to people and their needs, rather than to products.

Element 2: Company Commitment An organization that applies the marketing concept must focus all of its efforts on satisfying customer needs. 1. Requires coordination of all marketing activities: a. With each other, and b. With all other business functions. [accounting, production, management, and administration. ] 2. Enables the organization to improve its effectiveness in providing customer satisfaction, resulting in all business activities’ achieving company goals by satisfying the consumer.

Element 2: Company Commitment. . . continued General Electric is credited with recognizing the existence and importance of the marketing concept in its 1952 annual report. 1. Marketing concept must become a part of the entire organization. 2. “The concept introduces the marketing person at the beginning rather than at the end of the production cycle and uses marketing in each phase of the business. Thus, Marketing, through its research, will establish what the customer wants in a given product, what price he is willing to pay, and where and when it will be wanted. Marketing will have authority in product planning, distribution, and servicing the product. ”

Element 3: Company Goals When a company commits itself to consumer satisfaction and uses its resources for that purpose, the third element of the marketing concept, achievement of goals, should occur. A company should achieve its goals by giving customers what they want. 1. Primary goal of most businesses is to make a profit. Businesses should be able to achieve that goal by giving customers quality products or services at fair and reasonable prices. 2. Goals of not-for-profit organizations are different. [Goals could be developing a cure for a disease; increase view audience; decrease number of forest fires. ]

Element 3: Company Goals. . . continued C. Companies exist by achieving their long-term goals – not by making quick sales, offerings, or changes that do not satisfy customer needs and wants. D. If a business or organization does a good job of satisfying customer needs, customers will be loyal and have favorable attitudes towards the business. Repeat business will result.

Why is Marketing Important? Ø Increased production capacity [Because we live in an economy of abundance, producers are able to provide more goods and services than consumers demand. The results of marketing have yielded new developments in technology, automation, and mass production techniques. Our production of goods and services continues to grow each year. ] Ø Increased buying power of consumers [As a nation, we have little difficulty in producing what we want or as much as we want. Over half of the families living in our country have an annual income of $25, 000 or more. Most Americans have little trouble in buying the things that they need or want. ] Ø Need for coordinating production & consumption [Our problem is how to market effectively all of the things that we produce. Ø 1/4 to 1/3 of all workers are in marketing jobs [Of the more than 108 million people who make up our country's labor force, between ¼ to 1/3 are employed in marketing fields. ] 1. Retailing 3. Transportation 2. Wholesaling 4. Communications

Why is Marketing Important? . . continued Ø Majority of businesses in the US are marketing-type businesses [Examples: Banks, Insurance companies, Restaurants, Real estate firms, Supermarkets, Department stores, Specialty stores, Advertising agencies, Wholesale firms, Trucking companies, etc. ] Ø $. 50 - $. 60 out of every sales dollars goes to cover the costs of marketing [The cost of marketing includes marketing activities such as: research, advertising, transportation, storage, etc. Consumers are paying for the convenience of having the right goods, at the right time, in the right place, at a reasonable price. We are not talking about profit. We can never assume that goods and services would cost less without these vital marketing activities. To meet the needs and wants of consumers, we must continuously market goods and services. ]

Without Marketing Ø Increased personal contact with businesses [Consumers would need to make personal contact with businesses to learn about products because goods, services, and ideas would not be promoted. ] Ø Less variety in products [Businesses would reduce the variety of products from which consumers could choose. ] Ø Fewer product improvements [Fewer improvements would be made in existing products. ] Ø Fewer products developed [Fewer new products would be developed. ] Ø Increased stock shortages or overages [Businesses would suffer from shortages or overages in stock. ]

RAISES THE STANDARD OF LIVING: “Standard of living” refers to the way people live—usually it’s determined by the quantity & quality of the goods and services that people own and use. The marketing system in the United States has given us one of the highest standards of living in the world. In our country, most people are well fed and well clothes, have enough money, and have many work-saving devices to make life easier. We enjoy this standard of living largely because producers try to outdo each other in their efforts to serve us.

ADDS UTILITY TO GOODS/SERVICES: Marketing adds value, or utility , to goods and services by enabling consumers to obtain goods and services at the right time and in the right place. By analyzing consumer needs and wants, marketers are able to help producers make the goods and services that are wanted by consumers. Marketers are always trying to find ways of making products more useful to the people why buy them. a. Adding new features b. Servicing products after they are purchased c. Guaranteeing products against defects

MAKES BUYING CONVENIENT: Marketing constantly tries to make buying as easy as possible for consumers. Examples: Mail-order services Delivery services Telephone-order services Drive-in facilities Electronic video shopping Internet services

MAINTAINS REASONABLE PRICES: a. marketers compete with each other in pricing their goods and services. b. They must work hard to keep their prices down, so that they are competitive. c. One way in which they keep prices down is by looking for new ways of keeping their own costs down. d. The results in consumers’ receiving quality products at fair prices.

IMPROVES QUALITY OF LIFE: marketers have improved our quality of life by encouraging the development of safer, better goods and services. a. Flame-resistant infant wear b. Childproof bottles c. Caplets rather than capsules They have increased the public’s awareness of social and economic issues. a. Need for environmental controls b. Prevention of drug, alcohol and child abuse c. Alleviation of world hunger They’ve encouraged us to be safer drivers, to look for missing children, and to contribute to a variety of causes which could improve our existence.

PROVIDES A VARIETY OF GOODS AND SERVICES: Businesses offer a variety of models, styles, colors, and sizes from which to choose because they must compete to attract as many customers as possible. For example: Jeans—variety of styles, colors, sizes, brands, etc. Marketing also offers consumers choices among goods and services. Give Examples:

INCREASES PRODUCTION: Marketing determines what consumers want and informs them about items, their availability, and their uses. By providing items that consumers want, businesses encourage consumers to buy. When goods and services are purchased, more goods and services need to be produced or provided to replace those which have been sold.

§ § § § Raises the standard of living Adds utility to goods & services Makes buying convenient Maintains reasonable prices Improves the quality of life Provides a variety of goods & services Increases production