Chapter 8 Intro to Business

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Chapter 8Intro to Business

• Producing and Marketing goods and Services

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Role of Marketing

• Idea for development of a new product.
• Select product name
• Where products sold and how to get them there.
  (Channels of Distribution)
• Set price and how people can pay for it.
• (cash and carry/credit)
• Customer service and product improvement after
  product is sold.)

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Marketing Functions

• Product/Service Planning-assists in design and
  development by gathering information and testing
  ideas.
• Purchasing-identify and obtain the products
  needed for marketing activities.
• Financing-make sure financing and credit are
  available for purchase and sale of products.
• Distribution-getting products to customers.
• Pricing-set prices and payment method.
• Risk Management-provides security and safety for
  products and people and reduces business risk.
• Marketing Information Management-obtains and
  organizes information needed to make marketing
  decisions.
• Promotion-communicating with consumers to
  encourage purchase.)

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A Marketing Philosophy

• The philosophy of business is known as the
  marketing concept , which considers the needs of
  customers when planning, pricing, distributing,
  and promoting a product or service.
• To be successful, the business must be able to
• Identify customers they want to serve and
  understand their needs.
• Develop a product that will satisfy the customer
  and complete the necessary marketing activities.
• Complete these activities at a profit.)

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A Marketing Strategy

• Is a two step process that involves
• Target Market-A clearly identified group of
  consumers with needs that the business want to
  satisfy.
• Marketing Mix-a combination of marketing elements
  designed to meet the needs of a target market.
• The 4 Ps of Marketing
• Product-anything offered to the target market to
  satisfy their needs (products or services).
• Place-locations where product sold convenient to
  customers.
• Price-what customers are able to pay and method
  of payment.
• Promotion-methods used to communicate information
  to customers in order to encourage purchase.)

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Six Steps of Product Development
Buying Motives-the reasons for making a purchase.
(sometimes rational and logical, sometimes
not))
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Getting Products and Services to Consumers

• Channel of Distribution-is the path that a
  product travels from producer to consumer.
• Direct Channel of Distribution-from producer to
  consumer.
• Indirect Channel of Distribution-goods move
  through one or more middle firms between producer
  to consumer.
• Wholesaler-a middle firm that assists with
  distribution activities between businesses.
• Retailer-sells directly to consumer (may obtain
  goods from wholesaler or producer) collect
  products of many manufacturers and resells them.
  (Wal-Mart, Target, Meijers))

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Characteristics of Effective Distribution

• 4 important differences to consider in developing
  an effective channel of distribution.
• Differences in Quantity-adjusts the large
  quantity produced to the small quantity
  purchased.
• Differences in Assortment-accumulate many
  varieties of products in one place.
• Differences in Location-brings products from all
  over the world to convenient locations.
• Differences in Time-having the right products at
  the right time.)

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The Role of Pricing

• Objectives of Pricing-one of three goals
• Maximize Profits-how?
• Increase Sales-how?
• Maintain Image-how? (Kobe!)
• Factors that will influence Price
• Quantity-Walmart????
• Customer Service Offered
• Fragile and requires special handling.
• Businesses in the channel of distribution-direct
  vs. indirect.
• Amount of advertising and Communications
  necessary to inform consumers.)

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The Role of Pricing

• Promotional methods (3)
• Who are prospective customers being targeted?
• How many and where?
• What is the Message?
• What is the budget for promotion?