A Framework for Marketing Management

Chapter 1
Defining Marketing for the 21st Century

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Chapter Questions

Why is marketing important? What is the scope of marketing? What are some fundamental marketing concepts and new marketing realities? What are the tasks necessary for successful marketing management?

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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.

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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.

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What is Marketed?

Goods Services Events Experiences Persons

Places Properties Organizations Information Ideas

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What is a Market?
A market is a grouping of customers:

Need markets Product markets Demographic markets Geographic markets Other

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Who Markets?
A marketer is someone who seeks a response from another party, called a prospect.

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Key Functions of the CMO

Strengthening the brands Measuring marketing effectiveness Driving new product development based on customer needs Gathering meaningful customer insights Utilizing new marketing technology

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Marketing Process

Analyze marketing opportunities Select target markets Design marketing strategies Develop marketing programs Manage the marketing effort

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Core Marketing Concepts

Needs, wants, and demands Target markets, positioning, and segmentation Offerings and brands

Value and satisfaction Marketing channels Supply chain Competition Marketing environment

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Needs, Wants, and Demand

Needsbasic human requirements. Wantsdirected to specific objects that might satisfy the need. Demandswants for specific products backed by an ability to pay.

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Target Markets, Positioning, and Segmentation

Segmentationidentify and profile distinct groups of buyers examining demographic, psychographic, and behavioral differences. Target marketssegments presenting the greatest opportunity. Positioningwhat the offering means in the minds of the target buyers as delivering some central benefit(s).

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Offerings and Brands

Value propositiona set of benefits offered to satisfy customers needs. Offeringa combination of products, services, information, and experiences. Brandan offering from a known source.

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Value and Satisfaction

Valuethe sum of the perceived tangible and intangible benefits and costs to customers.

Customer value triad = quality, service, and price

Satisfactiona persons comparative judgment of a products perceived performance (or outcome) in relation to expectation.

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Marketing Channels

Communication channelsdeliver and receive messages from target buyers. Distribution channelsdisplay, sell, or deliver the physical product or service(s) to the buyer or user. Service channelscarry out transactions with potential buyers.

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Marketing Environment

Task environment includes the immediate actors involved in producing, distributing, and promoting the offering.

Broad environment includes six environments:

Demographic Economic Physical Technological Political-legal Social-cultural

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New Marketing Realities

Major societal forces New consumer capabilities New company capabilities

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Company Orientations

Production concept Product concept Selling concept Marketing concept Holistic marketing concept

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Production Concept

Premise: consumers prefer products that are widely available and inexpensive. Focus on:

High production efficiency Low costs Mass distribution

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Product Concept

Premise: consumers favor products offering the most quality, performance, or innovative features. Focus on:

Making superior products Improving them over time

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Selling Concept

Premise: customers, if left alone, will not buy enough of the organizations products. Focus on:

Aggressive selling and promotion efforts

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Marketing Concept

Premise: find the right product for your customers. Focus on:

Needs of the buyer

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Holistic Marketing Concept

Premise: everything matters with marketing. Focus on:

Relationship marketing Integrated marketing Internal marketing Performance marketing

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Relationship Marketing
Relationship marketing aims to build mutually satisfying long-term relationships with key constituents in order to earn and retain their business.

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Integrated Marketing
Integrated marketing requires the marketer to devise marketing activities and assemble fully integrated marketing programs that create, communicate, and deliver value for customers. Marketing activities include the four Ps.

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The Four Ps of the Marketing Mix

Product Price Place Promotion

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Internal Marketing
Internal marketing ensures that everyone in the organization embraces appropriate marketing principles, especially senior management. Everyone in the organization must think customer.

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Performance Marketing

Financial accountability Social responsibility marketing

Societal marketing conceptfollowing the marketing concept while preserving or enhancing customers and societys long-term well-being.

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Marketing Management Tasks

Developing marketing strategies and plans Capturing marketing insights Connecting with customers Building strong brands

Shaping market offerings Delivering value Communicating value Creating long-term growth

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Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

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