Handout 1. Principles of Marketing- Fano, 2023
ABM-11
Introduction to Marketing
Marketing is the creation and communication of value to customers. It involves the
customer’s maintenance of relationships that should last for lifetime. It is the link between
society’s material requirements for its needs and wants. Marketing must satisfy human
needs and wants through the exchange process and the building of long-term
relationships.
Over the years, marketing has evolved various definition and its meaning changes
according to the views of the different marketing gurus. Many view marketing as process
or dynamic business activity that is designed to plan and promote the delivery or satisfy
needs and wants of the potential and present market. In the definition of marketing given
by the American Marketing Association or AMA, “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.” The definition views as an exchange process or discipline that involves
strategies, activities, positions, and institutions.
The definition of Marketing according to Dr. Philip Kotler, “A social and managerial
process whereby individuals and groups obtain what they need and want through creating
and exchanging products and value with others.” It is also defined as the meeting of the
minds between the seller and the buyer to satisfy human needs and wants with profit on
the part of the marketer and the satisfaction of the buyer for the money he spent. On the
bases of this view, marketing is an organization intervention and functions that set the
process of creating, communicating and delivering value to customers.
From the academic point of view, marketing is the art and science of creating tangible
products or services and finding the market, getting and retaining them to attain profitable
operations. On one hand, it is a societal process that marketers must communicate the
sustainable value of the product or service to its target market. It is a critical business
process for attracting customers to satisfy their needs and wants.
Marketing is also an integrated process through which companies create value for
customers and build strong customer relationships in order to capture value from
customers in return. Simply put: Marketing is the delivery of customer satisfaction at a
profit.
Goal: Attract new customer by promising superior value and keep and grow current
customers by delivering satisfaction.
Handout 1. Principles of Marketing- Fano, 2023
ABM-11
The company and its market are equally important. It is marketing that gives fulfilment to
both components. Marketing people should balance between the company’s
requirements for profit and desired market share.
This is composed of two other interacting components: the customer and competition.
The overriding objective of the company is not just to satisfy the needs and want of its
customer. It must profitable and better than its competitor. Otherwise, the competitor
could win the customers because it is able to satisfy them.
Customer Needs and Wants
Need is one important component in the marketing of products. It is the consumer’s desire
for a product or service. The product or service must have specific benefits that satisfy
the functional or emotional needs. On the other hand, basic needs are food, clothing, and
shelter. We cannot live without them and marketers must be able to provide them to
human population.
Food can be processed in different tastes; styles and menus that shall meet the human
craving and satisfaction. Clothing could be designed into different styles depending on
people’s taste and social values. Shelters are constructed differently depending on the
capacity of the buyer to finance his home. These needs are the marketer’s point of interest
for profit.
Wants are higher-level human needs as they appeal more to the emotions. These are
the social needs for recognition and the development of higher social satisfaction is
limitless. The development of technology and different electronic gadgets are more of
human wants. The marketers must continuously improve technological inventions to
sustain customer wants.
Concepts of Marketing
According to Garovillas (2004), he stated that the marketing concept is a business
philosophy, which holds that the key to achieving organizational goals consists of
determining the needs and wants of target markets and delivering the satisfaction more
effectively and efficiently than competitors do.
Handout 1. Principles of Marketing- Fano, 2023
ABM-11
The philosophy of doing business is developed as people realized that marketing is vital
to the success of any marketing organization. The marketing concept emphasizes
customer orientation and coordination of marketing activities to achieve the marketing
goals and objectives. The philosophy that “The customer is the boss”, rings over the
minds of the marketing people that customer satisfaction which is of paramount
consideration. While it is important to satisfy customer wants and needs, this could only
be achieved under the following marketing concepts:
1. Marketing must be Customer Oriented.
The planning and operation must be directed towards customer orientation. The
whole marketing organization and its operating staff must be focused on
determining what will satisfy the needs and wants of the target customers, the
important link in the business operation.
2. Marketing must be Coordinated Activities Coordination activities must start
in the product planning process, the process.
The product is the key element that the customer wants to buy that is worth his
money. Price is another important component as customers would like to get his
money’s worth. The place of distribution must be within his reach and the
promotional activities must be appealing for him to decide which product to
purchase.
3. Marketing must be able to achieve the Performance Target Goals and
Objectives. Customer-oriented and coordinated marketing aims to achieve
its profit, objectives and goals.
These goals and objectives hinge on the increase in sales volume and customer’s
patronage. When product planning, price, promotion and distribution and properly
coordinated, it will result in the most effective way of satisfying the customer’s
needs and wants. The sales volume and profit objective will be realized.
Factors for Developing Marketing Concepts
1. Capturing Marketing Insights
The overall direction must focus on its vison and mission. The organizational goals
and objectives must be directed towards the creation of value to its customers.
These must be the inherent philosophy of the marketing organization. The
functional areas in the marketing organization must be focused towards its ultimate
set of tasks in the building of long-lasting relationship with its target market.
2. Effective Financial Management System
This system in the procurement of quality and affordable materials for processing
of the product is a vital component in effective operation of the marketing system.
The competition in the market is based on affordable quality products where labor
and materials interplay in their production. Financing the marketing program will
develop effective sales program that will bring in sustainable profitability.
3. The Value of Human Resources
All business activities need human resources in their operation. The employees
must be committed in the production of quality products and the delivery of quality
service. They must develop work ethics and strong commitment to the marketing
efforts of the organization. Sustainable development and progress rest with people
who are willing to put all efforts towards the organizational objective of quality
products and service.
4. The Production Process
The process must conform to standards in terms of product quality. The race to
economic profitability is the production of products that shall satisfy the customer’s
wants and needs. The role of marketing is to sell more products, but it must
conform to customer demand. Production may produce so many products, yet they
Handout 1. Principles of Marketing- Fano, 2023
ABM-11
are useless inventory when they fail to reach their target market. Marketing efforts
will turn them into profitable inventory.
5. The Presence of Competitors
The marketing of products becomes interesting with the presence of competitors.
Marketing outfit must develop strategies in capturing their target market and
develop and sustained patronage. These marketing strategies must develop
customer loyalty to the brand or the product. Product improvement and pricing
strategies with sustained promotional and advertising program are important
components in the competitive market.
Traditional concept marketing is a marketing strategy a company uses to
determine if it can produce a viable product consumer want or need, whether the
company can produce enough products to fill the need, and the marketing method
by which the need can be filled.
Several Distinct Traditional Approaches:
1. Production concept focuses on the internal potentials of the company and
not based on the desires and needs of the market.
2. Marketing concept a philosophy which states that organization must try
hard to find out and satisfy the needs and wants of consumers while at the
same time accomplishing the organizational goals.
3. Sales concept refers to the idea that people will buy more goods and
services through personal selling and advertising done aggressively to push
them in the market.
4. Relationship concept/marketing an approach that centers on maintaining
and improving value-added long-term relationships with current customers,
distributors, dealers and suppliers.
5. Societal Marketing Concept views that organizations must satisfy the
needs of consumers in a manner that gives for society’s benefit.
The Goals of Marketing and their Social Effects
1. Maximize the Consumption of Goods - The Aggressive marketing strategies and
policies had increased the consumption of goods and services. The demand of the
market is tremendous. Sellers face many challenges on what products to offer.
Buyers want quality products at reasonable price and t the most convenient
location. The marketing job is to stimulate greater product consumption. Greater
production requires consumption of material inputs and more goods in the market
that create more employment. More jobs are created, and more people enjoy
economic wealth. Maximum consumptions generate economic development for
the nation.
2. Maximize Consumer Satisfaction - The market demand is varied, and customer
satisfaction is the challenge of the marketing organization. Measurement of
customer satisfaction is difficult. It embraces careful analysis of the market demand
which varies with the time and the social development of society. The customer
may be satisfied with the product the marketing people produce but it may create
pollution to the environment. Plastics are good packaging materials for consumer
goods but they create flood and environmental pollution. Cars and other vehicles
using gas serve the convenience of the riding public, but they create global
warming that result to environmental imbalance.
3. Maximize Choice of Goods or Service - Some marketers believe that the goal
of marketing is to maximize the variety of the product in the market and provide
consumers a wide assortment of choices. The main objective is for customers to
find the goods that will satisfy their biological needs as well as their emotional and
social wants. Development of new products needs research but that will mean time
and costs. Maximizing consumer choice entails cost as the economies of scale do
Handout 1. Principles of Marketing- Fano, 2023
ABM-11
not operate in production of goods. The consumers must spend time studying the
benefits of the production of goods.
4. Maximize the Quality of Life - The improvement of the quality of life is the target
of marketing people. New hand phones are created to communicate with various
sectors of society, friends and families. Easy communications access satisfies not
only social needs but also business requirements. Compu0terss and others
electronic gadgets bring pleasures to homes and enjoyment of the comfort of living.
The quality of life is difficult to measure. Life satisfaction is more than the physical
comfort. The impact of electronic radiation has created health problems among the
many users of modern gadgets. People in the previous generations lived longer
because they lived a simple life. They ate unadulterated food and lived free from
pollution and radiation.
Goals of Marketing
1. Focusing on customer wants and needs to distinguish products from competition
2. Integrating all the organization’s activities to satisfy customer wants and needs
3. Achieving the organization’s long-term goals by satisfying customer wants and
needs
Key Performance Indicators
Key performance indicators (KPIs) are used to check that the marketing activities
of a company are on track. KPIs are specific metrics which are used to track
performance to make sure the firm is on track to meet specific objectives. They are
sometimes known as performance drivers or critical success factors for this
reason.
Examples of noteworthy marketing goals:
1. Identifying the target market
2. Increasing sales and profits
3. Increasing brand awareness
4. Increasing market share
6. Countering competitive strategies
7. Reputation
8. Increasing distribution channels
What is Traditional Marketing?
Traditional marketing is an umbrella term that covers the wide array of
advertising channels we see daily. These may include print media, billboard and TV
advertising, flyer and poster campaigns and radio broadcast advertising.
These traditional marketing messages are not necessarily outdated; however,
research has shown those companies that have abandoned simply using these channels,
and adopted contemporary marketing channels proposed in this article, have remained
prosperous and in fact seen an increase in leads, a higher quality of leads, sales and
traffic to web content.
Handout 1. Principles of Marketing- Fano, 2023
ABM-11
Ansoff's Matrix Theory
Traditional marketing theories include Ansoff's Matrix, a theory that proposes
products/services fall into one of four categories depending on the market and the product
released. New Product- New Market is considered as diversification. This theory
recommends that businesses should try to diversify their product portfolio to spread risk
amongst their product range. An example of this would be when Apple created the first
iPhone released in 2007. This product was new and introduced into a new market. Apple
soon reaped the benefits of introducing this hugely popular phone. Their product range
grew from accommodating for designers on the Apple Mac, to mobile devices, tablet
devices, watches and beyond.
The Marketing Mix
Another marketing theory that's considered to be traditional is the marketing mix
made up of the 7 P's. These include product, place, promotion, price, packaging and
positioning. All these components, when combined, create a solid marketing proposal.
However, this theory as well as Ansoff's, can be drastically improved with the use of
contemporary marketing strategies.
Traditional Marketing seeks to pull customers to a product, whatever the cost. It is,
for this reason, considered to be outdated as it does not consider the customer they are
selling to, more the market that the company operates within. There are however
channels that have developed from traditional marketing, including digital, that aim for the
same goal, however, use subtler and approachable mediums so as to capture their target
audience. This may include Pay-Per-Click campaigns, social media posts, search engine
optimization and email marketing.
Definition of Contemporary Marketing
Simply defined, contemporary marketing refers to marketing strategies that are
consumer focused. Contemporary marketing strategy offers products and services based
on what the target market desires rather than what the company wants them to have,
thereby, offering greater support for their customers and becoming able to take advantage
of more advanced marketing funnels to track progress.
Difference Between Contemporary Marketing Orientation and Traditional Marketing
Orientation
The main difference between the contemporary marketing orientation and
traditional marketing orientation is that while the former is consumer-focused, the latter is
company- focused. Traditional marketing is concerned with pulling customers and does
not really consider the customer's diverse needs. Rather it is concerned with the market
or industry in which the company operates in.
Contemporary marketing aims for customer’s satisfaction in order to build a
relationship with them. Therefore, the types of marketing strategies under contemporary
marketing are concerned with the needs of customers.
Since it first emerged as a distinct business and management phenomenon,
marketing has evolved significantly with new types of marketing to address changing
trends in the market. This is probably because most successful businesses use a
combination of different types of marketing whether they’re contemporary or traditional
marketing strategies to get great results. Business owners now see more reasons to get
the best out of the functions of marketing by enhancing their target marketing plan
example to deliver more developmental benefits. The diversity and improvement in
marketing nowadays could sometimes prompt one to wonder what marketing is meant to
look like. Our contemporary marketing world now features advanced marketing skills and
improved marketing mix.
Here are some of types of marketing:
1. Business to Business - B2B Marketing
2. Business to Consumer - B2C Marketing
3. Brand Marketing
Handout 1. Principles of Marketing- Fano, 2023
ABM-11
4. Cloud Marketing
5. Telemarketing
6. Guerrilla Marketing
7. Push Marketing
8. Influencer Marketing
Emerging Types of Marketing and their Applications:
Based on a 2017 report by Kleiner Perkins Caulfield and Byers, an internet trend
investment firm, 3.4 billion people use the internet. Therefore, the internet has become
an easy and quick way to research, reach and engage customers.
1. Search engine optimization is majorly concerned with increasing a business’
visibility and rankings on search engine result pages. It is a simple way of attracting
organic traffic of potential customers to a website. SEO can be maximized with paid
adverts (Google AdWords), strategic content marketing and social media networks.
2. Pay per Click advertising: This is advertising presented on search engine result
pages or web pages where the advertiser is only charged based on the number of
times someone clicks on the ads to go to the advertiser's targeted website.
3. Email marketing is a type of marketing based on the distribution of messages
through emails. Email marketing provides direct contact with customers and allows
businesses to create relationships with their customers. Updates, exciting news,
and call to actions can be sent directly to customers.
4. Referral marketing: is a type of marketing where an individual or customer pleased
with the results gotten from a product refers the product to another person. It's a
very subtle form of marketing that can provide great results especially when the
person referring is an Influencer in that industry.
5. Affiliate marketing: is a prominent type of internet marketing where a third party
promotes a product and earns commission, or a piece of the profit gotten from every
sale made through that referral.
6. Video marketing: Videos act as one of the most interactive types of online
marketing and can prove to be a great way to raise awareness about a business or
product. In fact, according to Mushroom networks, YouTube is the second biggest
search engine. Therefore, video marketing can prove to be a great way to pass
messages to target customers.
7. Inbound marketing is a very powerful contemporary marketing strategy that
focuses on different tactics to draw consumers in and convince them to buy goods.
It is one the result-oriented types of marketing that uses content to drive results. A
key subset of Inbound marketing is Content marketing which the Content Marketing
Institute refers to as "a strategic marketing approach focused on creating and
distributing valuable, relevant, and consistent content to attract and retain a clearly
defined audience."
Green Marketing refers to the process of selling products and/or services based on their
environmental benefits. Company are selling products and/or services by first promoting
its benefit that is environmentally friendly or produced in an environmentally friendly way.
For green marketing to be effective, there are three things that needs to be done:
1. Being genuine
a. The company is doing what it claims to be doing in its green marketing
campaign and;
b. The rest of the business policies are consistent with whatever the firm is doing
that’s environmentally friendly.
2. Educating the customers isn’t just a matter of letting people know that the company is
doing whatever it doing to protect the environment, but also a matter of letting them know
why it matters.
3. Giving customers an opportunity to participate means personalizing the benefits of the
company’s environmentally friendly actions, normally through letting the customer take
part in positive environmental action.
Handout 1. Principles of Marketing- Fano, 2023
ABM-11
Handout Tasks
Essay:
1. Suppose you are looking for a job. How would you apply marketing principles to
your job search? In what way would you be able to market yourself and impress
the human resource specialists to be a potential candidate for the job.
2. Is marketing appropriate for political candidates? Why or why not?
On Your Work Note
Directions: Write a short reflection on your activity notebook. Think of yourself as a loyal
customer of a pizza parlor. Considering the contemporary marketing approaches, what
additional features or services do you expect to be offered along with your order and / or
patronage of the establishment.
Direction: Answer briefly what is being asked.
1. How can a company build and maintain customer loyalty based on the relationship
marketing
concept?
2. Write the difference between traditional marketing and online marketing. Give
examples.
Answer the following questions:
1. What are the key elements in the AMA definition of Marketing? Do you find it
complete? Why?
2. In your Barangay, is marketing existing? Explain your answer
  End of Handout 1  