Download PPT CH 13 Marketing in Today`s World

CHAPTER 13
MARKETING
in TODAY’S WORLD
The Basics of Marketing
Market
A market is a group of customers who share
common wants and needs, and who have the
ability to purchase a particular product or
service.
The Basics of Marketing

MARKETING
is the process of creating, promoting, and
presenting a product to meet the wants and
needs of consumers.
Marketing

Marketing involves a number of stages, from
studying what people want to buy to designing a
product’s packaging.

Businesses perform detailed research to find and
analyze potential customers in their market.

Knowing what groups of people want and need
helps companies decide how and what to sell.
The Functions of Marketing
These functions define all the aspects that are part
of marketing.
1.
Distribution- how to get goods into the
customers’ hands…moving, storing goods is
part of distribution.
2.
Financing- getting the money needed to set up
a business, loans, stock options. Also, whether
to offer credit to customers.
7 Functions of Marketing
3.
Marketing Information Managementinformation about trends, customer,
and competing products. Gathering,
storing it, and analyzing information.
4.
Pricing- What to charge customers
based on costs and competition.
The Functions of Marketing
5.
6.
7.
Product/Service Management- obtaining,
developing, maintaining, and improving a
product in response to market opportunities.
Promotion- effort to inform, persuade, or
remind potential customers about goods or
services
Selling- selling to retail customers or B-2B. A popular trend in today’s marketing world
is RELATIONSHIP MARKETING. Companies use
this strategy to build customer relations.
Marketing Mix
4P’s of Marketing
Combination of 4 basic marketing strategies
– product, price, place, and promotion
-use and control to influence potential
customers.
-control decisions about each of the 4P’s
and base them on the people they want to
win over
- Marketers must first define each target
market …..5th P = people
Marketing Mix-4 P’s
1.
Product –

Marketing is used first to find out if there is a
demand for a product.

Marketing predicts how to present a product to
the customer to make it as appealing as possible.

Packaging is a major part of marketing. It includes
the design, color, size, and brand name of a
product
Marketing Mix-4 P’s
2.
Place/Distribution –

Marketers have to decide how and where
customers will buy their goods and services.

Marketers have to consider in what kind of
location to sell their product. Should it be in
a large department store or a boutique?

Select the right channel of distribution

The placement of the product in a store is
important.
Channel of Distribution

A Channel of Distribution is a pathway to
direct products to consumers.

Direct Distribution occurs when goods or
services are sold from the producer directly to
the customer

Indirect Distribution involves one or more
intermediaries. Distribution decisions affect
the price of products

The cost of distributing a product has to be
added to its price
Marketing Mix-4 P’s
3. Price
To determine the price of a product a
marketer considers three questions
1. How much are customers willing to pay?
2. Is the price competitive with other
products?
3. Can the company make a profit?
BREAK-EVEN POINT
price = costs/expensive
Marketing Mix-4 P’s
3. Promotion – Making customers aware of the
product. Making decisions about advertising,
personal selling, sales promotion, and
publicity
The most familiar form of promotion is
advertising, other ways to promote a
product is to offer discounts in the form of
coupons, rebates, and sales. They can also
give away items.
Market Research

It helps businesses make decisions.

Gathering and analysis of information on the size,
location, and makeup of a market.

Helps businesses determine consumer’s wants and
needs

Helps businesses to produce products that attract
customers.
Market Research

Marketing Concept involves determining
the wants and needs of customers and
providing them more efficiently and
effectively than competitors.

The focus is on the customer…repeat
customers keep a company in business.
Information About Consumers

Demographics – facts about the
population such as age, gender,
education, and income.

This information comes from surveys,
sales figures for current products, data
bases and the census.
Information About Consumers

Marketers gather information about the
people who make up the market.

Businesses aim their product or service at a
group of potential customers.

Target Marketing helps companies focus on
the people most likely to buy their goods or
services.
 Make
products to fit the target market
Information About Consumers

Market Segmentation is the division of a
market for a product into groups of
customers who have the same needs and
traits.
The Seven Steps of Product
Development

New products energize the marketplace.

A company’s ability to create a new
product or a slight variation of an already
successful one is important to increasing
sales.
The Seven Steps of Product
Development

Generate Ideas

Screen Ideas

Develop a Business Plan

Develop the Product

Test Market the Product

Introduce the Product

Evaluate Customer Acceptance
The Seven Steps of Product
Development

Step 1: Generate Ideas

Usually takes more than 1 person to come up
with new ideas.

Brainstorming: Workers get together to think
of new products
 Workers
from a company’s development
department, market research staff, and
outside market researches
 Collaboration
is key in this step
The Seven Steps of Product
Development

Step 2: Screen Ideas

Once the team puts together a list of ideas for
a product, the team must evaluate each idea.
 How
do these ideas fit the company’s mission
and strategy?
 Does
the new product compete with one of the
company’s existing products?
 Consumers
can identify what they liked or
disliked about the concept?
 Their
responses are crucial as to whether the
company continues with a proposed product
The Seven Steps of Product
Development

Step 3: Develop a Business Plan

The written proposal provides a look at
the market
 Estimated
sales, costs, profit potential,
market trends, and competing products
The Seven Steps of Product
Development

Step 4: Develop the Product

Make a prototype: a model of the actual
product.
 What
the new product will look like
 Tests
how it can be made
 If
any aspects of the prototype need to be
changed, now is the time to make changes.
A
company might experience delays in
finalizing the product as it is tested
The Seven Steps of Product
Development

Step 5: Test-Market the Product

Once the product is fully developed, it should be testmarketed
 Test
Market a product means to offer it in a limited
market for a limited time.
 The
goal is to collect customers’ responses to
determine if the product is likely to be a success.
 Testing
may give a competitor time to produce a
similar product.
 Then
both products may enter the market at the
same time, and the first firm loses its competitive
advantage
The Seven Steps of Product
Development

Step 6: Introduce the Product

A publicity campaign introduces the
product. The costs of launching a new
product are often high.

The company has a short time in the
market before competitors start to
develop similar products.
The Seven Steps of Product
Development

Step 7: Evaluate Customer Acceptance

Marketers track customers and their responses to
it.

Their reports answer key questions that can be
used in the company’s research and development
plans.
 Who
are the best customers?
 What
 How
 If
new products are they buying?
often do customers buy the new product?
customers like the new product, the company
will continue to produce it. If not enough
customers like it, it may not be on the market long