Hult | Pride | Ferrell
marketing 16e
Part 1
Marketing
Strategy and
Environment
1: Strategic Marketing Management
2: Developing and Implementing
Marketing Strategies
3: The Global Marketing Environment
© 2012 South-Western, a part of Cengage Learning
1-2
Learning Objectives
 To be able to define marketing as focused on
customers
 To identify some important marketing terms,
including target market, marketing mix, marketing
exchanges, and marketing environment
 To become aware of the marketing concept and
market orientation
 To understand the importance of building customer
relationships
 To learn about the process of marketing management
 To recognize the role of marketing in our society
© 2012 South-Western, a part of Cengage Learning
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Marketing Defined
The process of creating, distributing, promoting
and pricing goods, services and ideas to
facilitate satisfying exchange relationships with
customers and develop and maintain favorable
relationships with stakeholders in a dynamic
environment
© 2012 South-Western, a part of Cengage Learning
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Components of Strategic Marketing
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Who is the Focus of Marketing?
Customers
 The purchasers of organizations’ products
 Are the focal point of all marketing activities
Target Market
 A specific group of customers on whom an
organization focuses its marketing efforts
© 2012 South-Western, a part of Cengage Learning
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Think About It
 Axe features a line of body sprays
 Uses a multimedia marketing approach
 YouTube
 Facebook
 Twitter
 Viral Marketing
 To promote a new fragrance, Axe Music,
Unilever staged concerts around the country
featuring major music acts
 Based on what you know about Axe, who is
Axe’s target market?
© 2012 South-Western, a part of Cengage Learning
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Discussion Question
 Skinny Cow low-fat
dessert products are
not for all consumers
 Who is Skinny
Cow’s target market?
© 2012 South-Western, a part of Cengage Learning
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The Marketing Mix Variables
Marketers combine and balance four elements
when determining how to satisfy customers’
needs for a product
 Product
 Price
 Distribution
 Promotion
© 2012 South-Western, a part of Cengage Learning
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Product Variable
• A product can be a:
 Good
 Service
 Idea
 Is a haircut a product?
 What about telecommunications services?
© 2012 South-Western, a part of Cengage Learning
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Price Variable
 Relates to decisions and actions associated
with establishing pricing objectives and
policies
 Relates to determining product prices
 Determines the value of the exchange
© 2012 South-Western, a part of Cengage Learning
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Think About It
 Honda promotes the safety of its vehicles
and great value for the price. Can you think
of any other brands or products that do that?
 Do you agree that Hondas are a good value
for the cost?
•
Click here to access the company website
© 2012 South-Western, a part of Cengage Learning
1-12
Distribution Variable
 Make products available in quantities desired
 Minimize costs:
• Inventory
• Transportation
• Storage
 Select/motivate intermediaries
 Establish/maintain inventory control
 Develop/manage transportation and
storage systems
© 2012 South-Western, a part of Cengage Learning
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Promotion Variable
 Inform individuals or groups about the
organization and its products/services
• Advertising
• Public relations
• Personal selling
• Promotions
• Street teams
• Viral marketing
© 2012 South-Western, a part of Cengage Learning
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Think About It
 Advertising firm, vm-people, put together
the this ad outlining the use of viral
marketing
Do you think viral marketing can help firms
attract business?
© 2012 South-Western, a part of Cengage Learning
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Relationships with Customers
Exchange
 The provision or transfer of goods, services,
or ideas in return for something of value
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Stakeholders
 Constituents who have a “stake,” or claim,
in some aspect of a company’s products,
operations, markets, industry and outcomes
 BP was implicated in the largest
oil spill in history
• Who were affected stakeholders?
• What has BP done to repair stakeholder relations?
• What else can it do?
© 2012 South-Western, a part of Cengage Learning
1-17
Marketing Environment
 The six forces that surround the customer
and affect the marketing mix:
1.
2.
3.
4.
5.
6.
Economic forces
Political forces
Legal and regulatory forces
Technological forces
Socio-cultural forces
Competitive forces
 The marketing environment is dynamic
 Unlike marketing-mix variables, an
organization has no control over these forces
© 2012 South-Western, a part of Cengage Learning
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Marketing Environment
© 2012 South-Western, a part of Cengage Learning
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The Marketing Concept
 A management philosophy that an
organization should try to provide products
that satisfy customers’ needs through a
coordinated set of activities that also allows
the organization to achieve its goals
•
Not a second definition of marketing or a
philanthropic philosophy
•
A firm must satisfy its own objectives
© 2012 South-Western, a part of Cengage Learning
1-20
Firms To Know: Herman Miller
 A successful high-end furniture maker
 Recognized as highly ethical
•
Long history of environmental advocacy and
stakeholder awareness
 Satisfied employees
•
•
Comprehensive benefits
Non-discriminatory workplace
 Does Herman Miller utilize the marketing
concept?
•
Click here for more information
© 2012 South-Western, a part of Cengage Learning
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The Evolution of the
Marketing Concept
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Production and Sales Orientations
Production Orientation
 Industrial Revolution improved speed and
efficiency
 Large increases in available products
Sales Orientation
 Many products with not enough demand
 Businesses viewed sales and selling as the main
means of increasing profits
© 2012 South-Western, a part of Cengage Learning
1-23
The Market Orientation
 An organization-wide commitment to
researching and responding to
customer needs
• Emerged in the mid-20th century
• Determine what customers want and product
those products
© 2012 South-Western, a part of Cengage Learning
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Implementing the
Marketing Concept
 Establish an information system to discover
customers’ real needs
 Use the information to create satisfying
products
 Coordinate all activities
© 2012 South-Western, a part of Cengage Learning
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Managing Customer
Relationships
Relationship Marketing
 Establishing long term mutually satisfying,
buyer/seller relationships
Customer-centric Marketing
 Developing collaborative relationships with
customers based on focusing on their individual
needs and concerns
© 2012 South-Western, a part of Cengage Learning
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Think About It
 How can the Internet help marketers engage
in relationship marketing?
• Facebook and Twitter help companies improve
their relationship marketing
 Live, real-time updates
 Two-way dialogue with customers
 Fan pages and Like features on Facebook help
businesses find their target markets
© 2012 South-Western, a part of Cengage Learning
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Customer Relationship
Marketing (CRM)
Using information about customers to create
marketing strategies that develop and sustain
desirable customer relationships
© 2012 South-Western, a part of Cengage Learning
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Value-Driven Marketing
Value
 A customer’s subjective assessment of benefits
relative to costs in determining the worth of a
product
Value
=
© 2012 South-Western, a part of Cengage Learning
Customer
Benefits
–
Customer
Costs
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Discussion Question
 What kind-of
marketing
approach did
Maxwell
House take?
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Marketing Management
 The process of planning, organizing,
implementing and controlling marketing
activities to facilitate exchanges effectively
and efficiently

Effectiveness is the degree to which an exchange
helps achieve organizational objectives

Efficiency involves maximizing the resources an
organization must spend to achieve a specific
level of desired exchanges
© 2012 South-Western, a part of Cengage Learning
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The Importance of Marketing in Our
Global Economy
Creates
Career
Prospects
Promotes
Welfare
of
Consumers
and Society
Consumes
Large
Proportion of
Buyers’
Dollars
Is Used by
Non-Profits
Marketing
Connects
People
through
Technology
Is Important
to Business
and the
Economy
Fuels
the Global
Economy
Enhances
Consumer
Awareness
© 2012 South-Western, a part of Cengage Learning
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Discussion Questions
 Marketing helps to
connect people in the
global economy
 How does Apple utilize
technology in its
marketing efforts?
 How do Apple products
keep customers
connected?
© 2012 South-Western, a part of Cengage Learning
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Green Marketing
 A strategic process involving stakeholder
assessment to create meaningful long-term
relationships with customers while
maintaining, supporting and enhancing the
natural environment
 A way to engage in socially responsible
marketing
© 2012 South-Western, a part of Cengage Learning
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Think About It
 What are the benefits of green marketing?
 Method sells home care and personal
products with stakeholders in mind
•
Safe, biodegradable ingredients
•
Minimal packaging
•
Eco-friendly
© 2012 South-Western, a part of Cengage Learning
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Career Prospects
 All organizations engage in some kind of
marketing
• Even non-profits and government agencies
 25-33% of non-government workers in the
U.S. perform marketing activities
 Marketing skills are valuable in every field
© 2012 South-Western, a part of Cengage Learning
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Important Terms
•
Marketing
Marketing concept
Customers
Marketing orientation
Marketing mix
Relationship marketing
Target market
Customer-centric marketing
Products
Customer relationship
management (CRM)
Exchanges
Value
Stakeholders
Marketing management
Marketing environment
Green marketing
© 2012 South-Western, a part of Cengage Learning
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