Download Marketing Concept

Producing & Marketing Goods & Services
Chapter Eight
 At The End Of This Chapter You Will Be Able To
o List common marketing activities and define the marketing concept
o Explain the two steps in market planning
o Explain the advantage of small businesses in providing customer service
 The Role Of Marketing
o Marketing Functions—Groups of marketing activities
1. Product/Service Planning—assists in design/development by gathering
information and testing ideas
2. Purchasing—identifies & obtains products
3. Financing—makes sure financing & credit are available
4. Distribution—involves getting products to customers
5. Pricing—sets prices & payment methods
6. Risk Management—provides security & safety and reduces business risk
7. Marketing Information Management—obtains & organizes information
needed for marketing decisions
8. Promotion—involves communicating with customers
o Impact of Marketing On Your Life
 Effective Marketing
o Marketing Philosophy
 Marketing Concept—Considering the needs of customers when planning,
pricing, distributing, and promoting a product or service
1. Identify the customers you want to serve
2. Develop a product that will satisfy the customer needs & complete
the necessary marketing activities
3. Complete all activities at a profit
o Marketing Strategy—A two-step process for successfully planning and
marketing products and services
o Target Market—A clearly defined group of consumers with needs that the
business wants to satisfy
o Marketing Mix—A combination of marketing elements designed to meet the
needs of a target market
 Product—Anything offered to the product market to satisfy their needs
 Place—The locations where products are sold and the ways they are
made available to customers
 Price—What customers pay and the method of payment
 Promotion—The methods used to communicate information to
customers in order to encourage purchases and to increase their
satisfaction
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 Planning—A scheme or program for making, doing, or arranging
something; project, design, schedule etc.
Product Development
o Planning, Developing, and Testing New Goods & Services
o Developing Products & Services That Consumers Want
 Buying Motives—The reasons for making a purchase
Planning Distribution Channels
o Getting Products & Services To Consumers
 Channel of Distribution—The path that a product follows from producer
to consumer
 Direct Channel of Distribution—The process through which goods are
bought by the consumer directly from the producer
 Indirect Channel of Distribution—The process through which goods
move through one or more middle firms between the producer and the
consumer
 Wholesaler—A middle firm that assists with the distribution activities
between businesses
 Retailer—A business firm that sells directly to the consumer
o Characteristics Of Effective Distribution
1. Differences in Quantity
2. Differences in Assortment
3. Differences in Location
4. Differences in the Time
The Role Of Pricing
o Goals Of Effective Pricing
1. Maximize Profits
2. Increase Sales
3. Maintain an Image
o Factors That Will Influence A Product’s Price
1. The quantity of a product purchased
2. The level of service offered
3. If the product is fragile or requires special handling
4. The number of businesses in the channel
5. The amount of advertising/communication
Promotion For Successful Marketing
o The Role Of Promotion
o Selecting Promotional Methods & Media
1. Who are the prospective customers being targeted?
2. What is the message?
3. What is the budget for promotion?
o Personal Selling As a Promotional Activity