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CHAPTER

OVERVIEW OF MARKETING

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L E A R N I N G O B J E C T I V E S

Define the role of marketing in organizations.

Describe how marketers create value for a product or service.

Understand why marketing is important both within and outside the firm.

Overview of Marketing

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LO2

LO3

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What is Marketing?

Marketing the activity, set of institutions, and

processes for creating, capturing,

communicating, delivering, and exchanging

offerings that have value for customers,

clients, partners, and society at large

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Marketing is about Satisfying Customer Needs and Wants

What group is Lexus targeting with this ad?

What benefits of cars might Lexus advertise?

©Ian Langsdon/EPA/Newscom

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Marketing Entails an Exchange

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Marketing Requires Product, Price, Place, and Promotion Decisions

Product

Creating value

PRNewsFoto/PepsiCo;AP Photo.

Price

Capturing value

©Digital Vision Ltd.

Place

Delivering value

©BrandX/JupiterImages/Getty Images.

Promotion

Communication value

©Stockbyte/PunchStock.

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Product: Creating Value

The fundamental purpose of Marketing is to create value by developing a variety of offerings, including goods, services, and ideas, to satisfy customer needs.

Goods

Services

Ideas

Royalty-Free/Corbis

Roz Wodward/Getty Images

Flying Colours Ltd./Getty Images

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Price: Capturing Value

Price is everything a buyer gives up (money, time, energy) in exchange for the product.

How much are customers willing to pay and can a profit can be made at that point?

©Matthias Hangst/Getty Images Sport/Getty Images

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Place: Delivering the Value Proposition

Place, or supply chain management, describes all activities necessary to get the product to the right customer when the customer wants it.

Where would you find this product in the store?

Courtesy Horizon Organic Dairy

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Promotion: Communicating Value

Promotion is communication by a marketer that informs, persuades, and reminds potential buyers about a product or service to influence their opinions or elicit a response.

Photo by Paul Hawthorne/Getty Images

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Marketing Can be Performed by Individuals and Organizations

ETSY Website

C2C

Consumer B

B2C

Consumer A

B2B

Retailer (Sells PCs &

monitors)

Manufacturer (Makes monitors)

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Marketing Impacts Various Stakeholders

Society Customers

Employees SupplyChain

Courtesy National Fluid Milk Processor Promotion Board; Agency: Lowe Worldwide, Inc.

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Marketing Helps Create Value

1. H.Armstrong Roberts/Retrofile/Getty Images 2. Jamie Grill/Iconica/Getty Images 3. ©Ted Dayton Photography/Beateworks/Corbis 4. Ciaran Griffin/Stockbyte/Getty Images 5. ©Colin Anderson/Blend Images/Corbis

Production

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Sales

2.

Marketing3.

Value based marketing

4.

5.

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Value-Based Marketing

“Pure Dark ChocolateLight Exquisite Cookie”

Courtesy Pepperidge Farm.

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CHECK YOURSELF

1. What is the definition of marketing?

2. Marketing is about satisfying ______ and ______.

3. What are the four components of the marketing mix?

4. Who can perform marketing?

5. What are the various eras of marketing?

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How Do Firms Become Value Driven?

Sharing Information

Balancing Benefits with Costs

Building Relationships with Customers

Connecting with Customers Using Social and Mobile Media

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Connecting With Customers Using Social & Mobile Marketing

93% of marketers use social media tools for their businesses.

4.2 billion people link to some social media sites through their mobile devices.

Photo by Spencer Platt/Getty Images.

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CHECK YOURSELF

1. Does providing a good value mean selling at a low price?

2. How are marketers connecting with customers using social and mobile media?

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Why Is Marketing Important?

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CHECK YOURSELF

1. List five factors that emphasize the importance of marketing.

2. A firm doing the right thing emphasizes the importance of marketing to _________.