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2003 Prentice Hall, Inc. 0

Chapter 1Chapter 1

Defining Marketing for theDefining Marketing for the

TwentyTwenty--First CenturyFirst Century

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Why Study Marketing?Why Study Marketing?Needs describe basic human requirements such

as food, air, water, clothing, shelter, recreation,

education, and entertainment.

Needs become wants when they are directed to

specific objects that might satisfy the need.

(Fast food) Demands are wants for specific products

backed by an ability to pay.

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What Can Be Marketed?What Can Be Marketed?

Goods

Services Experiences

Events

Persons

Places

Properties Organizations

Information

Ideas

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Marketing DefinedMarketing Defined Kotlers social definition:

Marketing is a societal process by which

individuals and groups obtain what they need

and want through creating, offering, and freely

exchanging products and services of value with

others.

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Marketing ManagementMarketing Management

DefinedDefinedMarketing Management is the art and science of

choosing target markets and

getting

keeping and

growing customers through

creating

delivering and

communicating

superior customer value.

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The Changes In The Market:The Changes In The Market:

CustomerCustomer Changes inConsumer/Customerby the

information revolution :

Increased buying power.

Greater variety of goods and services.

Increased information.

Enhanced shopping convenience.Greater opportunities to compare product

information with others.

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The Changes In The Market:The Changes In The Market:

FirmFirm

Changes in Firm way of operating due to

digital/information revolution :

New promotional medium.

Access to richer research data.

Enhanced employee and customer

communication. Ability to customize promotions.

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Changes In MarketingChanges In Marketing

PracticesPractices Marketing practices had pass through three stages:

Entrepreneurial marketing (individual success stories)

Formulated marketing (now a formal marketing effort)

Intrepreneurial marketing (too formulated)

In Intrepreneurial marketing,as marketing becomes

more formulated, creativity is inhibited.

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Where one can shop?Where one can shop?Shopping can take place in a:

MarketplacePhysical entity e.g. Bohari Bazar, Forum

Market spaceVirtual entity e.g. Ebay, Amazon

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Target Markets &Target Markets &

SegmentationSegmentation

The customers served by the firm is called the

target market.

Customers differences in needs, behavior,

demographics or psychographics give rise to

market segments.

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ProductProduct vs Brandvs Brand A Productis any offering that can satisfy a need

or want.

A brandis a specific offering from a knownsource.

Success depends onwhenofferings delivervalue andsatisfaction tothe consumeror customer.

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Enhancing ValueEnhancing Value U can enhance the value of an offering to

the customer by:

Raising benefits.

Reducing costs.

Meta markets refer to complementary

goods and services that are related in theminds of consumers.

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The EnvironmentThe Environment

The environmentalforces have amajor impact on the marketingdecisions.

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Political/

Legal

Political/

Legal

EconomicEconomic

TechnologicalTechnological

NaturalNatural

DemographicDemographicSocioculturalSociocultural

CompetitiveCompetitive

EnvironmentEnvironment

IndustryEnvironmentIndustryEnvironment

The EnvironmentThe EnvironmentThe EnvironmentThe Environment

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The CompetitionThe Competition Four levels of competition can be distinguished by

the level of product substitutability:

Brand competition

Industry competition

Form competition

Generic competition

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Levels of CompetitionLevels of Competition

Generic Competition

Form Competition

Industry Competition

Brand Competition

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Levels of CompetitionLevels of Competition

Generic competitione.g. Honda against Dubai festival forthe same consumer rupee

Form competitione.g. Toyota against manufacturers of othervehicles that provide the same service such as Yamaha

(motorcycle)

Industry competitione.g. Honda against Toyota etc whomake the same products or class of products (different prices)

Brand competitione.g. Honda Civic against Toyota Corolla

who offer similar products and service to the same customersat similar prices

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The Marketing MixThe Marketing Mix The marketingprogram is developed to achieve the

companys objectives. Marketing mix decisionsinclude: Product: provides customer solution.

Price: represents the customers cost.

Place: customer convenience is key.

Promotion: communicates with customer.

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Company OrientationsCompany Orientations The orientation or philosophy of the firm typically

guides marketing efforts. Several competingorientations exist: Production concept Widely available & inexpensive

Product concept- Quality,performance & innovation

Selling concept-will buy enoughonly if persuaded

Marketing concept-Sense and respond

Customer concept-Shaping separate offers Societal marketing concept-Preservation of consumer &

society well being

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The 4 Pillars of MarketingThe 4 Pillars of Marketing

ConceptConcept Achieving organizational goals requires that company

be more effective than competitors in creating,delivering, and communicating customer value.

Four pillars of the marketing concept: Target market

Customer needs

Integrated marketing Profitability

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Relationship MarketingRelationship Marketing

Relationship marketingaims to build

long-term mutually satisfying relationswith key parties, which ultimately results

in marketingnetworkbetween the

company and its supporting stakeholders.

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Marketing ChannelsMarketing ChannelsMarketing Channels

Communicationchannels

Distribution channels

Service channels

Deliver messages to and

receive messages from

target buyers. Includes traditional

media, non-verbal

communication, and

store atmospherics.

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Service channels

Display or deliver the

physical products or

services to the buyer /user.

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Service channels

Carry out transactions

with potential buyers by

facilitating thetransaction.

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Supply Chain ConceptSupply Chain Concept

Asupply chain stretches from rawmaterials to components to final

products that are carried to final

buyers.

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Challenges in the MarketplaceChallenges in the Marketplace Globalization, technological advances, and

deregulation have created many challenges:

Customers

Brand manufacturers

Store-based retailers

Both companies and marketers have beenforced to respond and adjust.

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PakistaniPakistani MarketingMarketing

EnvironmentEnvironmentLearn how companies and marketers are responding

to new challenges.

Pakistani companies are slowly moving from salesto marketing.

High dependence on advertising and earlier onsales promotion

PR is being recognized as an important marketingtool and activities are now being planned.

New technologies and process are beingintroduced to cut costs.

01.mkt 21 century

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