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64 Cards in this Set
- Front
- Back
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Definition of Marketing
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Finding out wants and needs of customers and creating goods and services and new ideas to match those needs.
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Marketing vs. Production
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Marketing begins with potential customers needs, not the production process.
-Should determine what goods and services are to be developed. -Provide direction for production, accounting and financial activities and try to coordinate them. |
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Economic Utility
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Utility value comes from satisfying human needs.
-Form, Task, Time, Place, Possession |
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Micro Marketing
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The performance of activities that seek to accomplish an organization’s objectives by anticipating customers needs and directing a flow of need-satisfying
goods or services from producer to costumer or client. |
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Macro Marketing
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a social process that directs an
economy’s flow of goods and services from producers to consumers in the way that effectively matches supply and demand and accomplishes the objectives of the society. |
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AMA Marketing Definition
New definition developed in 1997 |
Marketing is the activity, set of institutions,
and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large. |
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Key Characteristics of Micro Marketing
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-product sells itself
-profit and no profit -focus on needs -focus of our course -build relationships |
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Key Characteristics of Macro Marketing
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-Looks at whole system
-Match producers and consumers -Every economy needs it |
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Economic System
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a set of principles and techniques by which a society decides and organizes the ownership and allocation of
economic resources |
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Market Directed Economic System
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Consumers are the invisible hand that guides the economy
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Planned Economic System
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Government decides what consumers should get
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Micro-Macro Dilemma
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What is good for some producers and consumers....might not be good for society as a whole.
ie: handguns, dangerous terrain vehicles, damage to land A/C, enlarges ozone layer |
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Role of Marketing-Macro prospective
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the main purpose of the markets and
market intermediaries is to make exchange easier and allow greater time for production, consumption and other activities including leisure |
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Macro marketing systems among different nations
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• International trade connects different nations’ macro marketing system
• WTO is the only international body dealing with the rules of trade between different nations • Countertrade overcomes the problems of tariff and quotas |
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Economies of Scale
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-larger production of product drives cost and price down
-mass production and mass distribution -can't be used for particular services ie: healthcare -flexible production sometimes meets needs better |
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Production Sector
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specialization and division of labor result in heterogeneous supply capabilities
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Consumption Sector
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heterogeneous demand for form, task, time, place, posession and utility to satisfy needs and wants
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Discrepancies of Quantity
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Producers prefer to buy and sell in large quantities. Consumers prefer to buy and sell in small quantities.
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Discrepancies of Assortment
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Producers specialize in in producing a narrow assortment of goods and services.
Consumers need a broad assortment. |
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Spatial Separation
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Producers tend to locate where it is economical to produce, while consumers are located in many scattered locations.
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Separation in Time
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Consumers may not want goods and services when producers would prefer to produce them and
time may be required to transfer goods from producer to consumer. |
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Separation of Information
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Producers do not know what, where, when and at what price. Consumers do not know what where when and at what price.
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Universal Functions of Marketing
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-Buying
-Selling -Market Information -Transporting -Storing -Risk Taking -Financing -Standardization and grading |
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Positive Aspects of Macro Marketing
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• It connects remote producers and
consumers (internet and transportation more efficient and fast) • It encourages economic growth and new ideas, innovation • Is becoming more efficient because forces competition and innovation for a better match with the costumers’ needs. |
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Critics of Macro Marketing
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Advertising is often annoying, misleading or
wasteful • Packaging and labels are often confusing and deceptive • Marketing creates interest in products that pollute the environment • Private information about costumers is collected to sell them things they don’t want • Marketing makes people too materialistic |
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E-Commerce
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• E-commerce refers to exchanges between individuals or
organizations—and activities that facilitate those exchanges—based on applications of information technology. • Innovations in e-commerce are making many firms and markets more effective (work better) and/or more efficient (less costly) |
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Buying Function
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looking for and evaluating goods and services
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selling function
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promoting the product, most visible function of marketing
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transporting function
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movement of goods from one place to another
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storing function
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involves holding goods until customers need them
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standardization and grading function
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sorting products according to size and quality
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Financing function
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provides necessary cash and credit to produce, transport, store, promote, sell and buy products
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Risk Taking function
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bearing the uncertainties that are part of the marketing process
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Intermediary (middleman)
2 types |
specializes in trade rather than production, plays role in exchange process
-Retailers -Wholesalers |
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Marketing Concept
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an organization aims all its efforts at satisfying its customers-at a profit.
-customer satisfaction -total company effot -profit...not just sales |
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Production Orientation
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Making whatever products are easy to produce and then trying to sell them.
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Form Utility
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Provided when someone produces something tangible
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Task Utlity
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When someone performs task for someone else
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Time Utility
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Products must be available when customer wants
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Place Utility
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Must be available where customer wants
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Posession Utility
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obtain goods/service and have right to use it
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Marketing Strategy Process Planning
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-Searching for new attractive opportunities
-Obtain a competitive advantage: a marketing mix that the target market sees as better than a competitor's meix |
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Market Segmentation
2 steps |
1-naming broad product markets
2-segmenting broad product markets in order to select target markets and develop marketing mix |
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Types of Opportunities to persue
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1-market penetration
2-market development 3-product development 4-diversification |
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Market Segment
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homogenous group of customers who will respond to marketing in a smiliar way
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Single Target Market Approach
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segmenting the marketing and picking one of the homogeneous segments as the firm's target market
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Multiple Target Market Approach
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Segmenting the market and choosing two or more segments, treating each as a separate target market needing a different marketing mix.
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Combined Target Market Approach
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Combining 2 or more submarkets into one larger target market as a basis for one strategy.
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Combiners
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Try to increase the size of their target market by combining two or more segments
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Segmenter
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Aim at one or more homogeneous segments and try to develop a different marketing mix for each segment.
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Product Market Description
4 parts |
1-Product type
2-Customer (user) needs 3-Customer Type 4-Geographic area |
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Product Market
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market with very similar needs and sellers offering various close substitute ways of satisfying those needs
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Generic Market
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Market with broadly similar needs, and sellers offering various, diverse ways of satisfying needs
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The Segmentation Process
2 steps |
1-Naming broad product markets
2-Segmenting this broad product market in order to select target markets and develop marketing mixes |
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Good market segments meet following criteria:
4 aspects |
Homogenous(Similar) within: the customers in a market segment should be as similar as possible with respect to their likely responses to marketing mix variables and their segmenting dimesions
2-Heterogeneous(different)between: the customers in different segments shoudl be as different as possible with respect to their likely responses to marketing mix variables and their segmenting dimensions 3-Substantial: segment should be big enough to be profitable 4-** MOST IMPORTANT Operational:segmenting dimensions should be useful for identifying customers and deciding on marketing mix variables |
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Segmenting Definition
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An aggregate process clustering people with similar needs into market segments.
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Qualifying Dimensions
Biggest |
relevant to including a customer type in a product market
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Determining Dimensions (product type) 2nd Biggest
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those that actually affect the customer's purchase of a specific type of product.
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Determining Dimensions (brand specific) Smallest
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Dimensions that affect the customer's choice of a specific brand.
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Segmenting v. Combining
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Segmenters:
-try to satisfy well -may produce bigger sales -profit is the balancing point Combining: -try to satisfy pretty well -too much combining is risky |
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Segmenting Techniques
Custering, CRM |
Clustering: try to find similar patterns within sets of data
Customer Relationship Management (CRM): fine tune the marketing effort with info from detailed customer database |
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Differentiating
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Fine tuning the element of the marketing mix to the specific need of the target market.
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Positioning
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Process by which marketers try to create an image or identity in the minds of their target market.
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Hierarchy of objectives
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Must be coordinated
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