Selling in the Marketing Environment The Nature, Development and Functions of Marketing • Marketing is the performance of business activities that directs the flow of goods and services from producer to consumer or user. • It involves activities necessary to assure that the right goods and services are moved efficiently to satisfied customers through the right channels, at the right price, and that the right promotional combinations are used. Markets and Market Segmentation • A market can be described as the total or aggregate demand of actual and potential buyers of a product, service, or anything else of value; aggregate is the composite demands of many consumers for a specific item. Within the total or aggregate demand are market segments, or groups of potential buyers who demand specific different requirements for the same item. Consumer Markets • The overall consumer market is composed of all the individuals and households that buy or acquire goods and services for personal or family consumption. • It can be segmented in several ways, such as by: – – – – – Demographic Psychological traits Physical characteristics Behavior patterns Marketing conditions Organizational Markets • Business organizations and non-profit organizations that buy sorts of goods and services for their own use, use in further production, resale, or redistribution. • Major types of organizational markets: – Industrial markets – Reseller markets – Government markets Emergence of a New Customer/ Society-Oriented Marketing Concept • Some critics of business and marketing have pointed out what they consider a serious flaw in the customer-oriented marketing concept. They have noted that while customers are at the heart of all business and marketing planning activities, the end result is to “give customers what they want” with little consideration of whether “what they want” is really beneficial either to them or to society. • Called the societal marketing concept, its aim is not only to fulfill consumer needs with something of value and benefit that will bring lasting satisfaction at a profit to the seller (the heart of the older customer-oriented marketing concept), but to provide as well “in a way that preserves or enhances the consumer’s and the society’s well-being.” Planning Sales/Marketing Strategies and Action Programs • Business firms commence planning their sales/marketing strategies and programs around products and markets by first making careful forecasts as to expected market demand and sales volume and profit potential. The end objective of planning derived from such forecasts is profitable sales. Forecasting in a Changing Marketplace • • • • Population growth and changing age structure Geographic shifts in population Age mix of household composition Income distribution within market areas Planning the “Marketing Mix” to be Employed in Carrying out the Strategies and Programs Product Classification • Product Classification According to Durability or Tangibility – Durable Goods – Non-durable Goods – Services • Consumer Goods Classifications – – – – Convenience Goods Shopping Goods Specialty Goods Unsought Goods • Industrial Goods Classifications – Materials and Parts • raw materials, manufactured materials and parts – Capital Items • installations, accessory equipment – Supplies and Services • operating supplies, maintenance and repair items, business services