Download Jobber Chapter 1 Principles of Marketing The Marketing Concept

Jobber Chapter 1
Principles of Marketing
The Marketing Concept
The concept of marketing describes the need of a company to reach its goals. They
can only succeed in this by fulfilling their customers’ needs better the competitors.
For this they have to create a (product or money) exchange which both parties
(provider and costumer) feel satisfied with.
The key components of the marketing concept are consumer orientation,
integrated effort and goal achievement.
There has to be distinguished between the two marketing concepts of
consumer orientation and product orientation:
Consumer Orientation
Production Orientation
Limitations of the Marketing Concept
These concepts only work on a certain level. There have to be considered different
limitations
-
Customer satisfaction is only one objective companies have to consider
-
The concepts may lead to a concentration on short-term satisfaction
-
If companies focus on reflecting but on creating demand there will
originate only dull marketing campaigns
Differences between market driven and internally orientated business
compare Jobber page 26
Efficiency – Effectiveness
Ineffective
Effective
Inefficient
goes out of
business quickly
survives
Efficient
Dies slowly
prospers well
Efficiency cares about the costs per unit and therefore tries to optimize the business
processes. This results in a low-cost production.
 Tries to “do things right”
Effectiveness cares about markets and marketing strategies. Its concern is to make
the right products for attractive markets.
 Tries to “do the right things”
Costumer value
Costumer value can be created by maximizing the benefits noticed by the costumer
and by minimizing his sacrifices.
Perceived benefits
Product benefits
Service benefits
Relational benefits
Image benefits
Perceived sacrifice
Monetary costs
Time costs
Energy costs
Psychological costs
Marketing Mix
An effective marketing mix is designed by ensuring that it matches costumer needs,
creates an advantage in competition, is well mixed and spread and fits to the
company’s resources.
Product
-
product lines /service products
branding
packaging
Price
-
The conditions of sale and supply
price variables-size and regularity of purchase
payment periods
credit terms
Place
-
providing access to customers for goods and services
location of distribution outlets
transport and delivery
inventory and marketing channels
Promotion
-
the physical and emotional features of the goods or services offered
communicating the message
media advertising
sales promotion
personal selling
Attention!
Examples:
The “4-Ps“ simplify the reality, there are several
other factors to be included.
people, process and physical evidence in service marketing
long-term relationship building in industrial marketing
Jobber Chapter 2
Marketing planning
Key Planning Questions
The Marketing Planning Process
Business Mission
The key questions are:
“What business are we in?” and “What business do we want to be in?”
The following tasks are useful
Define management competences
Purpose - why the company exists
Determine resources
Strategy - the commercial rationale
Assess environmental change
Company values - what senior managers
believe in
Consider company background and ethos
Standards and behaviour
Marketing Audit
The marketing audit is a systematic examination of a business’s marketing environment.
It provides answers to the following questions:
“Where are we now?” , “How did we get there?” and “Where are we heading?”
SWOT Analysis
The SWOT Analysis provides a simple method of summarizing the results of the
marketing audit.
Marketing Objectives
I. Strategic Thrust defines the future direction of the business
II. Strategic objectives are product-level goals relating to the decision to build,
hold, harvest or divest products.
The following methods are essential
BUILD sales and marketing share
HOLD or maintain current position
HARVEST through profit maximization
DIVEST and release resources for other products
Core Strategy
The Core Strategy consists of the three components “Target Markets”,
“Competitor Targets” and “Competitive Advantage”.
Target Markets is the process of matching the company’s resources and objectives
with a distinct group of costumers.
The key questions are:
“What are trying to achieve”, “What are we capable of offering?”
and “Which customer groups present the best opportunities?”
Competitive Advantage can be built by Differential Advantage or Cost Leadership.
Implementation
Strategies can only be effective if attention is paid to implementation issues.
Examples:
Change Management, Staff training, political issues
Control
The Principles of marketing control are:
(a) set performance standards
(b) locate/identify responsibility
(c) establish criteria for measurement
Jobber Chapter 3
Consumer behaviour
Dimensions of Buyer Behaviour
The key dimensions are:
Decision Influence
The decision of the purchase may be made by a group of people (e.g. a household).
The decision can be in the hands of a decision centre with up to five roles.
(1) Initiator
(2) Influencer
(3) Decision maker
(4) Buyer
(5) User
provides the stimulus
informs and persuades
has authority or finance
conducts the transaction
the ultimate consumer
The identification can provide opportunities to segment markets and to address the
right costumer target group.
Examples: Lego advertisement in women’s magazines
The decision making process
(1) Need recognition / problem awareness
(2) Information search
(3) Evaluation of alternatives
(4) Purchase
(5) Post-purchase evaluation
(1) Need recognition
One has to be aware of the costumer’s needs, know how to stimulate them and how
to overcome need inhibitors.
(2) Information search
Marketing has to know where the consumer looks for information. Communication
can then be directed through these sources and help to solve the consumer’s
decision-making. One key objective is to ensure that the brand appears in the
consumer’s awareness set.
(3) Evaluation of alternatives
High involvement purchase:
provide a lot of information
Print media suitable
Salespeople help to be aware of all features
Low involvement purchase:
Top-of-mind awareness
Repetitive advertisement
Trial
For all consumer decisions the knowledge of choice criteria and of the importance of
emotion is essential.
Choice criteria:
Technical
Reliability
Durability
Performance
Style/looks
Comfort
Delivery
Convenience
Taste
Personal
Self-image
Risk reduction
Ethics
Emotions
Economic
Price
Value for money
Running costs
Residual value
Life-style costs
Social
Status
Social belonging
Convention
Fashion
Post-Purchase Evaluation
The Post-Purchase Evaluation is a reflective process. It can be influenced by
after-sales service, packaging contents or installation staff. The Customer service aims
to reduce post-purchase dissonance.
High-Involvement Purchase
Low-Involvement Purchase
Low Involvement
High Involvement
Minor
Major, personally
important
Limited search
Extensive search
Few alternatives evaluated
on few choice criteria
Many alternatives
evaluated on many choice
criteria
Need recognition/
problem awareness
Information search
Evaluation of alternatives
and the purchase
Post-purchase evaluation of
the decision
Limited evaluation
Extensive evaluation
including media search
Influence of consumer behaviour
Socio-cultural:
culture, family, social class, reference groups
Personal:
age and life-cycle stage, economic circumstances,
occupation, lifestyle
Psychological:
motivation, perception, beliefs and attitudes
Culture
Culture reflects the values of our society and is therefore a basic determinant of
group behaviour. Some cultural values are universal, some are particular to groups.
These cultural groups may be national, ethnic, regional or local. A cultural shift
happens when a change in group values manifests in group behaviour.
Social class
Social class is traditionally used by marketers to distinguish the behaviour of one
group of people from another. Social class group members observe similar
consumption patterns. They read similar newspapers, go to similar shops or events
and spend their money in the same way.
Reference groups
Reference groups influence behaviour through different ways:
aspiration/identification (team leaders, elders)
opinion/example (celebrities)
peer group influence or pressure
Social Influence
The four types of social influence are culture, social class, geodemographics and
reference groups.
Life cycle Stages
The AIO-Classification
Activities
Interests
Opinions
Work
Family
Hobbies &
sports
Social events
& clubs
Shopping
Home
Community
Social & moral
issues
Economics &
politics
Education
Media
Environment
Vacation
Job
Products &
services
Jobber Chapter 5
Organizational Buying Behaviour
An organizational product has not been purchased for a private household but for the
use in an organization, to manufacture other products or for resale to others.
There are different organizational markets:
(1) Industrial markets: business to business (B2B)
(2) Reseller markets: business to consumer (B2C)
(3) Government markets: public sector