Marketing
What is Marketing?
• Many people think of marketing only as
selling and advertising .
• Selling and advertising are only the tip of
the marketing iceberg.
• Selling and advertising are only part of the
large ‘Marketing Mix’.
• Marketing mix is a set of marketing tools
that work together to satisfy customer needs
and build customer relationships.
Selling will be
easy
Prices, Distributes, and
Promotes them effectively
Develops Products that provide
superior value
Understanding Customer Needs
Marketing Iceberg
What is marketing
• 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.
Marketing was
Marketing now
Telling and
Selling
Satisfying
Customer
Needs
Marketing is the process by which companies
create value for customers and build strong
customer relationship in return
Marketer
Customer needs
and wants
Marketplace
Interaction
Marketing Management
We see marketing management as the art and
science of choosing target markets and getting,
keeping, and growing customers through
creating , delivering and communicating
superior customer value
The aim of marketing is to know and
understand the customer so well that the
product or service fits him and sells itself.
The Four Ps
The Four Cs
Marketing
Mix
Place
Product
Customer
Solution
convenience
Price
Promotion
Customer
Cost
Communication
Simple Marketing System
Communication
Goods/services
Industry
(a collection
of sellers)
Money
Information
Market
(a collection
of Buyers)
Traditional Organization Chart
Top
Management
Middle Management
Front-line people
Customers
Customer-Oriented
Organization Chart
Customers
Front-line people
Middle management
Top
management
Evolving Views of Marketing’s
Role
Finance
Production
Marketing
Finance
Human
resources
a. Marketing as an
equal function
Production
Human
resources
Marketing
b. Marketing as a more
important function
Evolving Views of Marketing’s
Role
Production
Marketing
c. Marketing as the
major function
Customer
d. The customer as the
controlling factor
Evolving Views of Marketing’s
Role
Production
Marketing
Customer
e. The customer as the controlling
function and marketing as the
integrative function
What is marketed?
1. Goods.
2. Services.
3. Events.
4. Experience.
5. Persons.
6. Places.
7. Properties.
What is marketed?
8. Organizations.
9. Information.
10. Ideas.
Customer needs
and wants
Needs Wants Demands
Marketplace
Market
Products, Services and
Experiences
Exchange
Customer needs, wants, and demands
The marketer must try to understand the target
market's needs, wants and demand.
Needs:
• Needs are the basic human requirements.
• Marketers do not create needs ; Needs preexist
marketers.
• Marketers influence wants, simply giving
customers what they want isn't enough to gain an
edge, companies must help customers learn what
they want.
Needs
The basic human requirements
Wants
Needs directed to objects that might
satisfy the need, regarding culture
Demands
Backed by an ability to pay
Marketer
impact to
shift wants
into
demands
Offerings and Brands:
•Companies address needs by putting a value
proposition , a set of benefits that they offer to
customers to satisfy their needs.
•A brand name such as McDonald`s carries many
associations in people`s minds that make up the
brand image : burgers , fun, childern, fast food,
convenience and golden arches.
Value and Satisfaction:
•The offering will be successful if it delivers value and
satisfaction to the target buyer.
•The buyer chooses between different offerings based
on which he/she perceives to deliver the most value.
• Value reflects the sum of the perceived benefits and
costs to customers.
Value and Satisfaction:
•Satisfaction reflects a person`s judgments of a
product`s perceived performance ( or outcome) in
relationship to expectations.
• If the performance falls short of expectations, the
consumer is dissatisfied and disappointed.
• If it matches expectations, the customer is satisfied .
• If it exceeds them, the customer is delighted.
consumer-driven approach:
• The four p`s represent the seller`s view of the
marketing tools available for influencing buyers.
•From a buyer`s point of view , each marketing tool is
designed to deliver a customer benefit.
• consumer wants are the drivers of all strategic
marketing decisions.
SIVA model
Product
Promotion
→
Solution
→ Information
Price
→
Value
Placement
→
Access
SIVA model
The four elements of the SIVA model are:
• Solution: How can I solve my problem?
• Information: Where can I learn more about it?
• Value: What is my total sacrifice to get this
solution?
• Access: Where can I find it?
Wants:
• Wants are the form human needs take as they are
shaped by culture and individual personality .
• needs become wants when they are directed to specific
objects that might satisfy the need.
• An American needs food but wants a big Mac, French
fries, and a soft drink .
Demand:
• Demands are wants for specific products
backed by an ability to pay. Many people
want a Mercedes; only a few are willing and
able to buy one.
• Marketing must learn about and
understand customer needs, wants, and
demands.
• The company conduct consumer research
and analyze customer data.
Exchange and transactions
• Exchange is the core concept of marketing, is the
process of obtaining a desired product from someone
by offering something in return. For exchange
potential to exist , five conditions must be satisfied;
1. There are at least two parties.
2. Each party has something that might be of value to
the other party.
3. Each party is capable of communication and
delivery.
Exchange and transactions
4. Each party is free to accept or reject the exchange
offer.
5. Each party believes it is appropriate or desirable to
deal with the other party.
• When an agreement is reached, we say that a
transaction takes place.
• A transaction is a trade of values between two or
more parties
Exchange and transactions
• A transaction involves several dimensions :
1. At least two things of value.
2. agreed-upon condition.
3. A time of agreement.
4. A place of agreement.
5. A legal system to support and enforce the
transaction.
Markets:
• A market is the set of actual and potential
buyers of a product.
• These buyers share a particular need or
want that can be satisfied through exchange
relationships.
• Sellers must Search for buyers ,identify
their needs, design good marketing offers,
set prices for them, promote them, and
store and deliver them.
Structure of Flows
Resources
Resources
Resource
markets
Money
Services,
money
Taxes,
goods
Services,
money
Manufacturer
markets
Taxes,
goods
Taxes
Government
markets
Goods, services
Consumer
markets
Services
Services,
money
Money
Money
Taxes,
goods
Intermediary
markets
Money
Goods, services
To design a winning marketing strategy
the marketing manager must answer two
important questions:
“ What customers will we serve( what
our target market) ? and How can we
serve these customers best ( what`s our
value proposition?)
Company Orientations Towards
the Marketplace
Production Concept
Consumers prefer products that are
widely available and inexpensive
Product Concept
Consumers favor products that
offer the most quality, performance,
or innovative features
Selling Concept
Consumers will buy products only if
the company aggressively
promotes/sells these products
Marketing Concept
Focuses on needs/ wants of target
markets & delivering value
better than competitors
Customer Delivered Value
Starting
point
Focus
Means
Ends
Factory
Existing
products
Selling and
promotion
Profits through
sales volume
(a) The selling concept
Market
Customer
needs
Integrated
marketing
Profits through
customer
satisfaction
(b) The marketing concept
Marketing Management Orientation
The Production Concept
• The production concept holds that consumers will
favor products that are available and highly
affordable.
• Management should focus on improving production
and distribution efficiency .
• This concept is one of the oldest orientation that
guide sellers.
• The production concept is still a useful philosophy in
two types of situations:
1. When the demand for a product exceeds the
supply, the management should look for ways to
increase productions.
Marketing Management Orientation
The Production Concept
•2. When the product`s cost is too high and improved
productivity is needed to bring it down.
• On the other hand, the production concept can lead
to marketing myopia.
• Companies adopting this orientation run a major
risk of focusing only on their own products, and losing
sight of the real objective of satisfying customer needs.
Marketing Management Orientation
The Product Concept
• The production concept holds that consumers will
favor products that offer the most in quality
performance, and innovative features.
• Marketing strategy focuses on making continuous
product improvement s .
• depending on products will not sell unless producers
design, package and price it attractively and places it
in convenient distribution channels.
Marketing Management Orientation
The selling Concept
•Consumers will not buy enough of the firm`s products
unless it undertakes a large-scale selling and
promotion effort .
• This concept fit only unsought products those that
buyers do not normally think of buying such as
insurance .
• Most firms practice the selling concept when they
face overcapacity .
•Their aim is to sell what they make rather than make
what the market want, and this strategy carries high
risks, it focus on creating sales transactions rather
than on building long-term customer relationship.
Marketing Management Orientation
The Marketing concept
•Holds that achieving organizational goals on knowing
the needs and wants of target markets and delivering
the desired satisfactions better than competitors do..
Social Marketing Concept
A principle of enlightened marketing that make a
good marketing decisions by considering consumer`s
wants, the company`s requirements , consumers`
long-run interests and society`s long run interests (
deliver value to customers in a way that maintains or
improves both the consumer`s and the society well –
being).