INTRODUCTION TO BUSINESS
Chapter 1
- BUSINESS : the organized effort of individuals to produce and sell, for a profit
the goods and services that satisfy society’s need.
To create business
ORGANIZED EFFORT: Business must combine 4 resources : human,
material , information, and financial altogether.
SATISFY NEEDS: to create product for what people want and happy.
BUSINESS PROFIT :remains amount of money after deducting cost from
revenue received.
-Classification of Business
Manufacturing Business: Process various material into producing
tangible goods.(Car factory).
Services Business: Providing intangible goods (Haircut, University,
Hotel).
Marketing intermediaries: Buy product from manufacturer and resell it
(7-eleven, Mega Bangna).
- StakeHolders : the persons who effects from organization decisions
(government, suppler, lender, owner ,community , etc. ).
-Economics : The study of how wealth is created and distributed.
Micro Economic: The study of the decisions made by individuals and
businesses.
MacroEconomic: The study of the national economy and the global
economy (GDP, Unemployment rate and etc.)
-Micro Economic
Perfect Competition: Market situation where there are many sellers and
buyers and none of them powerful enough affect the price of
product.(Price are set only base on demand and supply)
Monopolistic: Market situation where there are many sellers and buyers
who relatively differentiate their particular product from competitors.
(can control price higher than others) (our product is better)
Oligopoly: Market situation with few sellers (Boeing, Airbus, DTAC, AIS).
Monopoly: Market situation with only one seller
Natural monopoly : (unique material and hard to produce) : Electricity
Legal Monopoly : (when government entity issues copyright) : Lottery
- Economic System
Capitalism: Limited role of government, business and individual control
what to do and how to produce.
-Mix Economy : Is the mix between Capitalism and Command
economy.
Command Economy:is high role of government or the government
decides what will be produced, how it will be produced.
Two type of economic system under Command economy
-Socialism:government controlsKey industries (transportation,
utilities, and banking) ex. China, Sweden
-Communism : all factors of production are owned and controlled
by the government ex. North Korea, Cuba
- Factors of production
-Land / Natural Resources
-Labor / Human Resources
-Capital (Money, Materials)
-Entrepreneurship
-Measuring Economic Performance (Business cycle and Economic policy)
Productivity
-A ratio of production output is required to produce inputs.
-The average level of output per worker per hour.
Economic Indicators
-(GDP) or Gross Domestic Product
: Total value of product produce in that country.
:GDP growth rate :Percentage change in GDP.
-Unemployment
: The percentage of a state labor forces unemployed, they have
ability, they are capable but they have no job.
- Inflation and Deflation
: Inflation is a general increase in the prices level.Deflationis a
general decrease in the prices level, that these prices measured by
Consumer price index or CPI
-Consumer price index or CPI
: Average of prices in a basket of consumer goods and
services.
-Business cycle
-Prosperity or peak
-Recession or contraction
-Trough or depression
-Recovery
-Economic Problems
-Inflationary : a strong in rising level of demand (Economic Boom).
-Recessionary : a contraction in level of demand (Economic Downturn).
-Economic Policy
-Monetary policies :Central bank’s decisions that control the size of the
money supply in the nation and the level of interest rates.
-Fiscal policy :Government control on the amount of savings and
expenditures by setting the tax and by changing the levels of government
spending.
Chapter 8 Customer Relationship through Effective Marketing
Marketing definition
The activity set of institutions, and processes for creating, communicating,
delivering, and exchanging offerings that have value for customers. Clients,
partners, and society at large
Activities and processes
Creating, communicating,
delivering, and exchanging
products
For customers, clients
Managing Customer Relationship
1. Relationship marketing
Establishing long-term, mutually satisfying buyer seller relationship.
2. Customer relationship management (CRM)
Using information about customers to create marking strategies.
3. Customer lifetime value
A combination of purchase frequency, value of customer over lifetime
(long-term)
Utility : ability of the goods and the services satisfy a human need.
Marketing
-Form utility
- Time utility
- Place utility
- Possession utility
Form utility : Everything you can see and touch such as shape, design, sixe of
shoes.
Time utility : Making product available when customer wants the product.
Place utility : Making product available at a location.
Possession utility : Transferring to buyer ownership of a product to a buyer.
Type of Marketing
B2C : not buy product to make profit.
: personal use, family use/ not to make a profit
: buy for use only
B2B : make a profit
- Producers : buy products to use in the manufacture
- Reseller : buy product and sell for a profit
- Government : highways, education, utilities, defense
- Institutions : earn for profit such as church, hospital, school
Customer relationship management (CRM)
1. Define target market
Market segmentation
Demographic
Psychographic
Geographic
Age
Personality
Country
Gender
Lifestyle
Region
Race
Feeling
Urban
Income
Interest
Rural
Education
Motives
climate
Occupation
Religion
2. Marketing mix and marketing environment
The firm generally has no control at all
- Economic forces
- Competitive forces
- Social/cultural forces
- Technological forces
- Political forces
- Legal and regulatory forces
4PS
-
Product
Price
Place
Promotion
Behavoristic
Volume usage
End use
Brand loyality
Breakeven Analysis
The calculation
Total revenues: The total amount received from sales of a product
Unit Sold
Selling Price
Revenues
0
20
0 x 20 = 0
1
20
1 x 20 = 20
10
20
10 x 20 = 200

Total Revenues (TR) =Selling Price (SP)×Unit Sold (Q)
Total Cost: The total amount paid to produce a product
 Total Variable Cost (TVC) =Quantity (Q) ×variable cost (VC)
Unit Sold
0
1
10

VC per unit
5
5
5
Total Variable Cost
0x5=0
1x5=5
10 x 5 = 50
Total cost (TC) = Total Fixed Cost (TFC) + Total Variable Cost (TVC)
Unit Sold
0
1
10
TFC
7000
7000
7000
TVC
0
5
50
Total Cost
7000
7005
7050
Calculating breakeven
Total Revenues (TR) = Total Cost (TC)
𝑇𝐹𝐶

Finding break even in units, use this formula 𝑄 =

Finding breakeven in dollars, use Quantity in formula above multiply by
selling price(SP)
𝑆𝑃−𝑉𝐶
CH.9 Creating Pricing Products
Product: Whatever you can sell,tangible,intangible
Classification of product
-Consumer product: A product purchased to satisfy personal and family needs
1.Convenient Product-A relatively inexpensive,frequently purchased item for
which buyers want to exert only minimum effort e.g. Gum,Candy,Drinking water
2.Shopping Product-An item for which buyers are willing to expend
considerable effort on planning and making the purchase e.g.
Appliance,cosmetics
3.Specialty Product-The items that have one or more unique characteristics
for which a group of buyers is willing to expend considerable purchasing
effort(no substitute) e.g. Super car
-Business Product:A product bought for resale,for making other products,or for
use in a firm’s operations.
Product Life Cycle
A series of stages in which a product’s sales revenue and profit increase , reach
the peak , then decline.
Introduction
-Product Awareness
-Promotional campaigns concentrate on features,uses and benefits
-Financial losses are common due to low initial sales and heavy promotional
costs
-Facing only limited competition,it might use a skimming-pricing approach
-Distribute through just a few channel
Growth
-Sales climb quickly
-Firm usually begins to realize profits due to higher sales volume.
-Marketing efforts continue to focus on establishing the product in the market
and building brand awareness.
-Later in growth stage,the strategy shifts to building loyalty
-Additional spending on product adaptation,promotion and distribution,along
with lower prices mat necessary
-Distribute through multiple channel
Maturity
-Industry sales continue to grow at a decreasing rate(eventually reach a plateau)
-Companies emphasize market segmentation
-Some firms reduce prices and/or spend heavily on promotion
-Advertising use to differentiate the product from competitor
-Profits depend on sales
Decline
-Innovations of shifts in consumer preferences cause an absolute decline in
industry sales
-Industry as a whole does not generate profits,though some firms can prosper
-Prices tend to hold steady if a loyal market segment continues to buy the
product
-If the firm is selling to customers who are loyal,they can skip most of the usual
advertising
Product Line- A group of similar products that differs only in realtively minor
characteristics e.g. iphone4s iphone5 iphone5s
Product mix-All of the products that firm offers for sale
The width of the mix:The number of product lines the Mix contains
The Depth of the mix:The number of products within each line.
Branding(Brand:A name,symbol,design that identifies a seller’s product)
-Brand name  Brand mark(symbol)
-Trade name  Trade mark
Packaging and labeling : graphic or information over the package
-Protect the product and easy to transport
-Offer consumer convenience
-Promote the product
Product Pricing
Price competition-An emphasis on setting a price equal to or lower than
competitors’ prices to gain sales or market share
Non Price competition-Competition based on factors other than price(such as
quality,customer service,packaging)
Pricing Method
-Competition based pricing-Based on the challenge of competitors’ prices in
markets where products are quite similar or price is an important customer
consideration
-Demand-Based pricing-Based on the level of customer demand for the
product.Product prices are high when the demand is high and low when demand
is weak.
•Price differentiation-setting different prices in segmented markets based on
segment characteristics
-Cost-Based Pricing-The seller determines the total cost of producing one unit of
the product then adds an amount to cover additional costs and profit(mark-up_
•Be facilitated through the use of “Breakeven Analysis”
Chapter 11 Integrate Marketing Communication
The coordination of promotion efforts to ensure their maximal information an
persuasive impact on customers
Promotional Mix
 Advertising
 Personal Selling
 Sale Promotion
 Public Relation
Advertising
 A paid non-personal message communicated to a select audience through
a mass medium
Personal Selling
 Personal communication aimed at informing customers and persuading
them to buy a firm’s products
Sale Promotion
 Activities or materials that are direct inducements (incentive) to
customers
Public Relations
 Communication activities used to create and maintain farvorable relation
between an organization and various public groups