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1
Defining Marketing
for the 21st Century
Marketing Management, 13th ed
Chapter Questions
• Why is marketing important?
• What is the scope of marketing?
• What are some fundamental marketing
concepts?
• How has marketing management
changed?
• What are the tasks necessary for
successful marketing management?
1-2
What is Marketing?
Marketing is an organizational function
and a set of processes for creating,
communicating, and delivering value
to customers and for managing
customer relationships
in ways that benefit the
organization and its stakeholders.
1-3
What is Marketing
Management?
Marketing management is the
art and science
of choosing target markets
and getting, keeping, and growing
customers through
creating, delivering, and communicating
superior customer value.
1-4
Selling is only the tip of the
iceberg
1-5
“There will always be need for
some selling. But the aim of marketing
is to make selling superfluous. The aim
of marketing is to know and understand
the customer so well that the product or
service fits him and sells itself. Ideally,
marketing should result in a customer
who is ready to buy. All that should be
needed is to make the product or
service available.”
Peter Drucker
Obtaining Products
1-6
For an exchange to occur….
• There are at least two parties.
• Each party has something that might be
of value to the other party.
• Each party is capable of
communication and delivery.
• Each party is free to reject the
exchange offer.
• Each party believes it is appropriate or
desirable to deal with the other party.
1-7
What is Marketed?
• Goods (tangible)
• Services (intangible)
• Events (time based—
trade shows) and
Experiences (Walt
Disney World’s Magic
kingdom)
• Persons (Artists,
Musicians, CEO,
Physicians)
1-8
• Places (Cities, States,
Regions, Nations) and
Properties (Intangible
rights of ownership of real
estate or financial properties)
• Organizations
(Universities, Museums,
Performing Arts Organization)
• Information (Books,
Schools, Magazines)
• Ideas (Revlon sell hope)
Marketing Goods
1-9
Marketing Ideas:
Friends Don’t Let
Friends Drive Drunk
This is the watch
Stephen Hollingshead,
Jr. was wearing when
he encountered a drunk
driver.
Time of death 6:55 p.m.
1-10
Key Customer Markets
• Consumer markets (personal
consumption)
• Business markets (resale or used to
produce other products or services)
• Global markets (international)
• Nonprofit/Government markets
(Churches, Universities, Charitable
Organizations, Government Agencies)
1-11
Key Customer Markets
1-12
Consumer Markets
Global Markets
Business Markets
Nonprofit/ Government
Markets
Global Markets
Coke is represented at the
first China International
Beverage Festival in Beijing
in 2003
1-13
Corporate Social Initiatives
1-14
The marketplace isn’t what it used to be…
Changing technology (digital
revolution)
Globalization (transportation,
shipping, communication)
Deregulation (telecommunications,
electric utilities)
Privatization (British Airways)
Empowerment (Domestic, Foreign,
Store and Brands)
Customization
Convergence (Computing and
consumer electronics—Dell/ HP)
Disintermediation
1-15
Demand States
• Negative (dislike product
and may even pay a price to
avoid it)
• Irregular (purchases vary
on a seasonal, monthly, weekly,
daily, or even hourly basis)
• Nonexistent (unaware
• Unwholesome (product
of or uninterested in the
product)
that have undesirable social
consequences)
• Latent (need that cannot
be satisfied by existing
product)
• Declining (buy the
product less frequently or
not at all)
1-16
• Full (adequately buying all
products put into the
marketplace)
• Overfull (more consumers
would like to buy the product
that can be satisfied)
Production-Oriented and Marketing-Oriented
Managers Have Different Views of the Market
Company Orientations
• Production (consumers will prefer products that
are widely available and inexpensive)
• Product (consumers favor products that offer the
most quality performance, or innovative features)
• Selling (consumer and businesses, if left alone,
won’t buy enough of the organization’s products)
• Marketing (find the right product for the
consumers)--i.e., satisfy the wants and needs of the
consumers
1-18
The Four P’s
1-19
Marketing-Mix Strategy
1-20
Marketing Mix and the Customer
Four Ps
• Product
• Price
• Place
• Promotion
1-21
Four Cs
• Customer
solution
• Customer cost
• Convenience
• Communication
Core Concepts
• Needs, wants, and
demands
• Target markets,
positioning (in mind
of target buyers),
segmentation
• Offerings (intangible
benefit made physical)
and brands (offering
from a know source)
• Value (set of benefits
and satisfaction)
1-22
• Marketing channels
(communications,
distribution, and
service)
• Supply chain
• Competition
• Marketing
environment
• Marketing planning
Marketing Management Tasks
• Developing
marketing strategies
(strategic fit)
• Capturing marketing
insights (obtaining
information)
• Connecting with
customers
(relationships)
• Building strong
brands (understand
strengths and
weaknesses)
1-23
• Shaping market
offerings
• Delivering value
• Communicating
value
• Creating longterm growth
(positioning and
new-product
development)
Functions of CMOs
• Strengthening the brands
• Measuring marketing effectiveness
• Driving new product development
based on customer needs
• Gathering meaningful customer insights
• Utilizing new marketing technology
1-24
Improving CMO Success (cont.)
• Make the mission and responsibilities
clear
• Fit the role to the marketing culture and
structure
• Ensure the CMO is compatible with the
CEO
• Make line managers marketing heroes
• Require right-brain and left-brain skills
1-25
New Consumer Capabilities
• A substantial increase in buying power (a click
away)
• A greater variety of available goods and
services (internet)
• A great amount of information about
practically anything (online)
• Greater ease in interacting and placing and
receiving orders (24/7)
• An ability to compare notes on products and
services (internet)
• An amplified voice to influence public opinion
(internet)
1-26
Internal Marketing
Internal marketing is the task of
hiring, training, and motivating able
employees who want to serve
customers well.
1-27
Holistic Marketing Dimensions
1-28
Performance Marketing
• Financial
Accountability—
building band and
growing the customer
base.
• Social Responsibility
Marketing—must
consider ethical
environment, legal, and
social context on
activities.
1-29
•
•
•
•
•
•
Social Initiatives
Corporate social marketing
—supporting behavior change
campaigns
Cause marketing —promoting
social issues through
sponsorships, licensing
agreements, and advertising
Corporate philanthropy—
making gifts, goods, or time
Corporate community
involvement—in kind or
volunteer service
Socially responsible
business practices—to protect
environment and human and
animal rights
I want it, I need it…
5 Types of Needs
• Stated needs (inexpensive)
• Real needs (low operating
cost)
• Unstated needs (good
service)
• Delight needs (extras)
• Secret needs (savvy
consumer)
1-30
Marketing Debate
Does Marketing
Create or Satisfy Needs?
1-31
Study Question 1
The identification and profiling of distinct
groups of buyers who might prefer or
require varying product and service mixes
is known as ________.
A. segmentation
B. integration
C. disintermediation
D. targeting
E. partner 1-32
relationship management
Study Question 2
Companies address needs by putting
forth a(n) ________, a set of benefits that
they offer to customers to satisfy their
needs.
A. brand
B. value proposition
C. offering
D. target market
E. demand1-33
Study Question 3
If a marketer decides to use warehouses,
transportation companies, banks, and insurance
companies to facilitate transactions with
potential buyers, the marketer is using what is
called a ________.
A.
B.
C.
D.
E.
service channel
distribution channel
brand channel
relationship channel
intermediary channel
1-34
Study Question 4
Managers of ________-oriented businesses
concentrate on achieving high production
efficiency, low costs, and mass distribution.
A.
B.
C.
D.
E.
selling
product
production
marketing
consumer
1-35
Study Question 5
________ activities include those the company
undertakes to make the product accessible and
available to target customers.
A.
B.
C.
D.
E.
Consumer behavior
Market segmentation
Marketing research
Channel
New-product development
1-36