What is Marketing

Terms to KnowCustomers

⁻ Those who buy products/services

Consumers⁻ Those who use the products/services

Market⁻ potential customers who have the ability and

willingness to buy

Disposable Income⁻ Money left over after taxes

Discretionary Income⁻ money left over after basic necessities

Products/Service⁻ Tangible vs. Intangible

What is Marketing- Process of developing, promoting, and

distributing products to satisfy customer’s needs and wants

- Economics in action

Economics – the study of how scarce limited resources are allocated to satisfy needs and wants

Economics vs. Marketing- Economics ensures everyone has what they

need/want, Marketing gets customers what they need/want

Marketing Functions Distribution• Getting product from producer to consumer

FinanceFinding away for people to afford a product

Market Information ManagementDetermining what people want

PricingDetermine what customers will pay

Product/Service ManagementGiving people what they want

PromotionEnticing customers to buy the product/service

SellingGetting people to buy a product

Marketing Functions Distribution Finance Market Information Management Pricing Product/Service Management Promotion Selling

Marketing Concept1. Satisfy needs and wants2. Do it better than the competition

Competitive Advantage

Utility• Added value1.Form – in a useful form2.Place – available where customers can get

it3.Time – available when customers want it4.Possession – able to take it home5.Information – know about the

product/service

Marketing MixStrategies used to achieve the marketing

concept5 P’s1.Product2.Place3.Price4.Promotion5.People

Product StrategyStrategies applied to the productInclude:Branding (Name)Product MixProduct PositioningProduct Life Cycle

Price StrategySetting a price to achieve an objectiveIncludes:Stage of PLC

Price Skimming/PenetrationPsychological Pricing TechniquesSupply and Demand

Place StrategyHow do customer get the product

What are some different ways customers receive the product?

Channels of Distribution

Channels of Distribution- Path a product takes from producer to

consumerPlayers:1.Producers2.Consumers3.Intermediaries – “middleman”; move

products from producers to consumers

Intermediaries1. Retailers – sell products to consumers2. Wholesalers – buy in large quantities; sell

to retailers3. Agents

- sell to wholesalers or retailers- don’t take physical ownership

Channels of DistributionA B DC

Producer

Consumer

Retailer

Wholesaler

Agent

Retailer Retailer

Wholesaler

Distribution IntensityExclusive Distribution

– 1 outlet in a geographical area

Selective Distribution – limited number of outlets in an area

Intensive Distribution – available in all suitable outlets

Promotion StrategyEnticing customers to buy the productPromotion - Informing, persuading, or

reminding them about a productForms:Sales PromotionSellingAdvertising (Print, TV, Radio, InternetPublic RelationsPublicityGuerilla Marketing Viral Marketing

People StrategySelecting the right group of people for your

product/serviceCreating a Target Market – very specific group

of people the product is aimed atMarket vs. Target Market

Marketing Segmentation – dividing the total market into smaller groups of people who share specific needs and characteristicsDemographic Psychographics Geographics Product Benefits

Personal characteristics that describe a population

May Include:Age

Generation X – 1965-1976, products of dual career households

Generation Y – digital nativesGenderIncome

DisposableDiscretionary

Others?

Demographics

Consumers lifestyle, attitudes, and valuesMay include:

Sports enthusiastsExtremistsConservativesLiberalsOthers

Psychographics

Where a population livesMay Include:

RuralUrbanSuburbsOthers?

Geographics

Population that uses product based on benefits

May IncludeSpecialty shoes (ie. Football shoes,

basketball shoes)Diet sodaOthers

Product Benefits

Examples