Marketing for the 21st Century

INTRODUCTION DEFINING MARKETNG FOR THE 21 ST CENTURY

THE WORLD OF MARKETING IMPORTANCE OF MARKETING THE SCOPE OF MARKETING COMPONY ORIENTATION TOWARDS THE MARKET PLACE FUNDAMENTAL MARKETING CONCEPTS, TRENDS AND TASKS

IMPORTANCE OF MARKETING IN YOUR LIFE Marketing is a large part of your daily life. Consumers are exposed to 3,000 commercial messages a day. Studying marketing will make you a better-informed customer. Marketing probably relates -- directly or indirectly -- to your career aspirations.

Defining Marketing 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 Marketing is a societal process by which individuals and groups obtain what they need and want through creating, offering, and freely exchanging products and services of value with others. (KOTLER) Marketing is about managing profitable customer relationships Attracting new customers Retaining and growing current customers The process of building profitable customer relationships by creating value for customers and capturing value in return 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.

Marketing Management Marketing management is the art and science of choosing target markets and building profitable relationships with them. This definition must include answers to two questions: What customers will we serve? How can we serve these customers best?

What Can Be Marketed? From serious goods and services to fun things Goods and services mirror changes in popular culture Marketing messages may communicate myths of a culture Product: any good, service, or idea Consumer goods/services Business-to-business goods/services Not-for-profit marketing Idea, place, and people marketing

Simple Marketing System Goods/services Money Industry (a collection of sellers) Market (a collection of Buyers) Communication Information

Structure of Flows Manufacturer markets Services, money Government markets Services, money Services Services, money Taxes Taxes, goods Taxes, goods Taxes, goods Money Money Consumer markets Intermediary markets Goods, services Goods, services Resources Resources Resource markets Money Money

Traditional Organization Chart Customers Front-line people Middle Management Top Management

Customer-Oriented Organization Chart Customers Front-line people Middle management Top management Customers Customers

Evolving Views of Marketing’s Role a. Marketing as an equal function Finance Production Marketing Human resources b. Marketing as a more important function Finance Human resources Marketing Production

Evolving Views of Marketing’s Role c. Marketing as the major function Marketing Finance Human resources Production d. The customer as the controlling factor Customer Human resources Finance Production Marketing

Evolving Views of Marketing’s Role e. The customer as the controlling function and marketing as the integrative function Customer Marketing Production Human resources Finance

DIFFERENCES BETWEEN MARKETING AND SELLING. Marketing is the process of determining customer wants and then developing a product to satisfy that need and still yield a satisfactory profit. It is externally focused. Selling is producing a product and then trying to persuade customers to purchase it -- in effect, trying to alter consumer demand. It is internally focused.

QUALITY IN MARKETING Quality has three dimensions Meeting and striving to exceed customers’ requirements. The absence of variation. Total organizational commitment. The best indicator of quality is customer satisfaction.

Core Concepts of Marketing Product or Offering Value and Satisfaction Needs, Wants, and Demands Exchange and Transactions Relationships and Networks Target Markets & Segmentation Marketing Channels Supply Chain Competition Marketing Environment

Understanding the Marketplace Needs, wants, and demands Marketing offers: including products, services and experiences Value and satisfaction Exchange, transactions and relationships Markets Need State of felt deprivation Example: Need food Wants The form of needs as shaped by culture and the individual Example: Want a chicken karahe Demands Wants which are backed by buying power Core Concepts

Marketing Is about Meeting Needs Meeting the needs of diverse stakeholders Buyers, sellers, investors, community residents, citizens. Marketing concept Identifying consumer needs and providing products that satisfy those needs The modern marketplace a mall, a mail-order catalog, a TV shopping network, an eBay auction, or an e-commerce Web site

Understanding the Marketplace Needs, wants, and demands Marketing offers: including products, services and experiences Value and satisfaction Exchange, transactions and relationships Markets Core Concepts Marketing offer Combination of products, services, information or experiences that satisfy a need or want Offer may include services, activities, people, places, information or ideas

Understanding the Marketplace Needs, wants, and demands Marketing offers: including products, services and experiences Value and satisfaction Exchange, transactions and relationships Markets Value Customers form expectations regarding value Value proposition includes the whole bundle of benefits the firm promises to deliver, not just the benefits of the product itself The ratio of costs to benefits Satisfaction A satisfied customer will buy again and tell others about their good experience Core Concepts

Value and Satisfaction Perceived Value The customer’s evaluation of the difference between benefits and costs. Customers often do not judge values and costs accurately or objectively. Value proposition includes the whole bundle of benefits the firm promises to deliver, not just the benefits of the product itself Customer Satisfaction Product’s perceived performance relative to customer’s expectations.

Understanding the Marketplace Needs, wants, and demands Marketing offers: including products, services and experiences Value and satisfaction Exchange, transactions and relationships Markets Exchange The act of obtaining a desired object from someone by offering something in return One exchange is not the goal, relationships with several exchanges are the goal Relationships are built through delivering value and satisfaction Core Concepts

Understanding the Marketplace Needs, wants, and demands Marketing offers: including products, services and experiences Value and satisfaction Exchange, transactions and relationships Markets Market Set of actual and potential buyers of a product Marketers seek buyers that are profitable Core Concepts

Production concept Product concept Selling concept Marketing concept Societal marketing concept Social marketing concept: satisfy customers’ needs and also benefit society Sustainability: meeting present needs and ensuring that future generations can meet their needs Marketing Orientations

Some industries and organizations remain at the production-orientation stage. PRODUCTION ORIENTATION PRODUCTION ORIENTATION SALES ORIENTATION Other industries and organizations have progressed only to the sales-orientation stage. Many industries and organizations have progressed to the marketing-orientation stage. PRODUCTION ORIENTATION SALES ORIENTATION MARKETING ORIENTATION Late 1800s Early 1930s Mid-1950s 1900s

Production Concept Product Concept Selling Concept Marketing Concept Consumers prefer products that are widely available and inexpensive Consumers favor products that offer the most quality, performance, or innovative features Consumers will buy products only if the company aggressively promotes/sells these products Focuses on needs/ wants of target markets & delivering value better than competitors Company Orientations Towards the Marketplace

Customer Delivered Value Market Integrated marketing Profits through customer satisfaction Customer needs (b) The marketing concept Factory Existing products Selling and promotion Profits through sales volume Starting point Focus Means Ends (a) The selling concept

Marketing as an Organizational Philosophy Marketing Philosophy Selling Philosophy Production Philosophy Internal Focus External Focus

The Four Ps Marketing Mix The Four Cs Customer Solution Customer Cost Communication Conven- ience Product Price Promotion Place

MARKETING MIX PRODUCT: A good, service, idea to satisfy the consumer’s need. PRICE: What is exchanged for the product. PROMOTION: Means of communication between the seller and buyer. PLACEMENT: Means of getting the product to the consumer. POSITIOINING: Developing a marketing strategy aimed at influencing how a particular market segment perceives a good or service in comparison to the competition.

The Marketing Plan Transforms the marketing strategy into action. Includes the marketing mix and the 4P’s of marketing Product Price Place Promotion

Building Customer Relationships CRM – Customer relationship management Delighting the Customer The overall process of building and maintaining profitable customer relationships by delivering superior customer value and satisfaction. It deals with all aspects of acquiring, keeping and growing customers.

Capturing Value from Customers Customer Loyalty and Retention Share of Customer Customer Equity Customer delight leads to emotional relationships and loyalty Customer Lifetime Value shows true worth of a customer Key Concepts

Capturing Value from Customers Customer Loyalty and Retention Share of Customer Customer Equity Share of customer’s purchase in a product category. Achieved through offering greater variety, cross-sell and up-sell strategies. Key Concepts

Capturing Value from Customers Customer Loyalty and Retention Share of Customer Customer Equity The combined customer lifetime values of all current and potential customers. Measures a firm’s performance, but in a manner that looks to the future. Choosing the “best” customers is key Key Concepts

Contemporary Marketing Framework Marketing C V Global Relationship Productivity Customer Value Ethics Entrepreneurship Technology Slide 8

Transaction Versus Relationship Marketing Long-Term Focus “ We” Oriented Short-Term Focus “ Me” Oriented Focus on Results Emphasize Persuading A Contest Manipulation Conflict Transaction Marketing Relationship Marketing Focus on Profits Emphasize Helping A Service Trust Cooperation

Go to the website of University Of Management and Technology, Lahore Pakistan www.umt.edu.pk

Marketing for the 21st Century

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