Defining Marketing for the TwentyFirst Century

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Defining Marketing for the Twenty-First Century
Chapter 1
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Definition of Marketing

• Marketing is the process of planning and
  executing the conceptions, pricing, promotion and
  distribution of ideas, goods, and services to
  create exchanges that satisfy individual and
  organizational goals. (AMA)
• Marketing is meeting needs profitably.

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Figure 1-3 A Simple Marketing System
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Conditions of Exchanges

• There are at least two parties.
• Each party has something that might be of value
  to the other party.
• Each party is capable of communication and
  delivery.
• Each party is free to accept or reject the
  exchange offer.
• Each party believes it is appropriate to deal
  with the other party.

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Needs, Wants and Demands

• Needs the basic human requirements.
• Wants when needs are directed to specific
  objects that might satisfy the need.
• Demands wants for specific products backed by an
  ability to pay.
• Marketing managers are responsible for demand
  management.

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Demand States and Marketing Tasks

• Negative Demand ? Counter Marketing
• No Demand ? Stimulus
• Latent Demand ? Developing
• Declining Demand ? Remarketing
• Irregular Demand ? Synchromarketing (????)
• Full Demand ? Maintain Marketing
• Overfull Demand ? Demarketing (???)
• Unwholesome Demand ? Social Marketing

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Marketing Philosophy

• The Production Concept
• The Product Concept
• The Selling Concept
• --------------------------------------------------
  ------
• The Marketing Concept
• The Customer Concept
• The Societal Marketing Concept

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The Production Concept

• Consumers will prefer products that are widely
  available and inexpensive.
• Focus achieving high production efficiency, low
  costs, and mass distribution.
• Examples Standard Raw Materials and Components,
  CD, LCD.

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The Product Concept

• Consumers will favor those products that offer
  the most quality, performance, or innovative
  features.
• Focus making superior products and improving
  them over time.
• Examples Digital Camera, CPU.
• Better Mousetrap Fallacy
• Marketing Myopia. (Theodoes Levitt, 1965)

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The Selling Concept

• Consumers and businesses, if left alone, will
  ordinarily not buy enough of organizations
  products.
• Focus undertake an aggressive selling and
  promotion effort.
• Examples unsought goods encyclopedias, funeral
  plots, foundations.

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The Marketing Concept

• The key to achieving its organizational goals
  consists of the company being more effective than
  competitors in creating, delivering, and
  communicating superior customer value to its
  chosen target markets.
• Slogans ???????, ????, ???????, We do it all for
  you (Toyota).
• Four pillars target market, customer needs,
  integrated marketing and profitability.

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Figure 1-9 Traditional Organizational Chart
versus Modern Customer-Oriented Company
Organization Chart
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Figure 1-8 Contrasts Between the Sales Concept
and the Marketing Concept
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STP concept

• Segmentation
• Identify bases of segmenting.
• Develop profiles of resulting segments.
• Targeting
• Evaluate the attractiveness of each segment.
• Select the target segments.
• Positioning
• Identify possible positioning concepts for each
  target segment.
• Develop marketing mix for each target segment.

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Integrated Marketing

• Integrating the various marketing functions.
• Integrating marketing with other departments
  (production, finance, human resource).
• External marketing and Internal marketing

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Figure 1-6 The Four P Components of the
Marketing Mix
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Figure 1-7 Marketing-Mix Strategy
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The Customer Concept

• Shaping separate offers, services, and messages
  to individual customers.
• Examples Designed Clothes, Database Marketing.

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Figure 1-11 The Customer Concept
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The Societal Marketing Concept

• The organizations task is to determine the
  needs, wants, and interests of target markets and
  to deliver the desired satisfactions more
  effectively and efficiently than competitors in a
  way that preserves or enhances the consumers and
  societys well-being.
• Examples Body Shop, HSBC.

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Relationship Marketing

• Creating, maintaining, and enhancing long-term
  relationships with individual customers as well
  as other stakeholders for mutual benefits.
• Reasons (i) consumers desire superior customer
  value (ii) it is more cost-effective to retain
  customers than to acquire new ones.

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Marketing Debate
Does Marketing Create or Satisfy Needs? Take a
position Marketing shapes consumer needs and
wants versus Marketing merely reflects
the needs and wants of
consumers.