THE MARKETING SYSTEM

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Module 1

It is a system concerned with the
planning and development of products
and services, determination of prices,
creation of promotional programs and
distribution system to present and
prospective market for the satisfaction
of their existing needs and wants,
thus maximizing profit in the longrun.
Marketing is a system
 Product or service planning and
development, pricing, promotion and
place of distribution
 Presence of current and potential
market
 Satisfaction of existing needs and
wants.

 Marketing
organizations or
marketers
 Things to be Marketed
 Target market or the buyers
 Producers
 Manufacturers
 Wholesalers
 Retailers
 Institutions
who buy raw
materials and process these
into final products
 Institutions
buying
intermediate or half-finished
materials and process these
into final products
 Institutions
who buy finalfinished products and resell
them in bulk in the same
original form.
 Institutions
who buy finished
products and re-sell in small
quantities, the same goods to
final users.
 PRODUCTS
 SERVICES
 IDEAS
 INSTITUTIONS
OR PEOPLE

Consumer Market- those who buy
goods for their own personal use or
purpose
 Industrial Market- those institutions
or people who buy industrial goods
either for the purpose of using in
business or for re-sell purpose
Target
Market
Marketing
System
Things to be
marketed
Marketing
Organizations
OPERATIONAL DIMENSIONS OF MARKETING

Is a management
orientation which holds that
the key task of the
organization is to
determine the needs and
wants of the target markets
and to adapt the
organization to delivering
the desired satisfactions
more effectively and
efficiently than its
competitors.
MARKETING CONCEPT

Is a management
orientation which
assumes that
consumers will either
buy or not buy enough
of the organization’s
products unless the
organization makes a
substantial effort to
stimulate their interest
in its products.
SELLING CONCEPT
Discovers market needs
(Research)
Product Planning and
Development
(Production)
Distribution of Products and
Services
GUARANTEED SALES VOLUME
AND PROFITS AT CUSTOMER
SATISFACTION
Product Planning and
Development
Promotional Methods and
Selling
Distribution of Products and
Services
UNGUARANTEED SALES VOLUME
AND PROFIT, UNGUARANTEED
CUSTOMER SATISFACTION
Goods and Services
Gathering of Information
Marketing
Organizations
Target
Market
Information
Payments

It is the process of knowing the overview of
the entire target market, but differentiating
them from competitors by recognition of
sub-markets with similarity in needs but
differs in demographic, geographic,
economic, cultural and psychological ways.

Consumer/Industrial Market
Demographic bases- population, age group,

Cultural bases- race, religion, nationality,



sex category
education, occupation
Economic bases- income bracket
Psychographic bases- personality, buying
attitudes, product benefits desire
Consumer Goods
a.
Convenience goods
b. Shopping goods
c.
Specialty goods

Industrial Goods
a.
Raw materials
b. Fabricating materials and parts
c.
Installations
d. Accessory equipment
e.
Operating supplies





Consumers know what, how, when and where
to buy these products because they have
complete product knowledge.
Consumers do not exert too much effort in
buying (accessible outlets)
If temporary or permanent product
inavailability exists, consumers are willing to
accept substitute brands
Examples: toothpaste, candies, seasonings




They may be sub-classified into service
goods or fashion goods.
They compare product prices or other
features before deciding for the best buy.
Market may not have full knowledge so they
product information is obtained as they shop
around.
Examples: RTW, shoes, appliances, furnitures




Consumers are willing to exert special buying
effort and may spend time to reach exclusive
dealers
Consumers are after the brand prestige,
irrespective of its high price.
In some cases, consumers may not accept
substitute brands.
Examples: Signature items like Sylvia Santos
bags



Products which will become part of another
final product
Products when integrated to produce another
product can be unidentifiable or cannot be
physically separated.
Examples: flour in making bread, eggs for
processing milk



These are industrial goods which will become
part of another final product but are
identifiable in finished form.
These are assembled products with no further
change in form.
Examples: buttons in dresses, sparkplugs and
fan belts



These are major equipments of the industrial
user.
They affect operating scale for production
quota of the company.’
Examples: adding dozen of typewriters in a
business; adding three presser machines for
a tin can industry.



They facilitate or aid in the production
operation of the industrial user.
It will not be part of any final product nor
give significant effort in production scale.
Examples: cash registers for food chain
outlets, calculators



These are the convenience goods of industrial
market
They have low unit price, short-lived which
facilitate business operations.
Examples: pens, pencils, typewriting papers
Marketing a Potentially Harmful Product
The Swiss pharmaceutical global corporation Hoffman-LaRoche has made a major breakthrough in the relief of serious
disabling disease that affects 3 percent of the world’s population.
Their new product, Tigason, is the first product that effectively
controls severe cases of psoriasis and dyskeratoses, skin disorders
that cause severe flaking of the skin. Sufferers from this disease
frequently retreat from the society because of fear of rejection; thus
losing their families and jobs. Tigason does not cure the disease but
it causes the symptoms to disappear.
There is one potential problem. Because of the risk of
damage to unborn babies, women should not take the drug for one
year before conception or during pregnancy. Hoffman-La-Roche is
well aware of the potential for harm to the company if the product is
misused. The marketing department is asked to formulate a strategy
for disseminating product information and controlling Tigason’s use.
As marketing manager, what do you recommend?
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