Transcript Introduction to Marketing 1 Module intro, marketing

Introduction to Marketing
Marketing concept and
business orientation
Geoff Leese Dec 2001 revised
Sept 2002, August 2003,
November 2008, January 2010
(special thanks to Geoff Leese)
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Content
The marketing concept
 Micro & Macro environments
 Marketing research
 Buying behaviour
 Segmentation
 Product/service, Price, Place,
Promotion
 Marketing planning

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The marketing concept

What marketing isn’t
 Presentation
& image - “spin”
 Glossy brochures & expensive
advertising
 Persuasive selling methods
 Excessive/wasteful packaging
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What is marketing?
“The aim of marketing is to make selling superfluous. The aim is
to know and understand the customer so well that the
product/service provided fits him/her and sells itself.
Drucker.
“…..a social & managerial process by which individuals &
organisations obtain what they need and want through
creating and exchanging products and value with others
Kotler
“The management process responsible for identifying,
anticipating and satisfying customer requirements
profitably.”
CIM
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Marketing concepts (1)

Target markets
 All
different
 Classification using criteria

Customer needs
 Real
needs
 Stated needs
 Unstated needs (assumptions)
 Delight needs
 Secret needs
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Marketing concepts (2)

Co-ordinated marketing
 all
functions working together
 marketing throughout the organisation
 marketing management

Profitability
 long
term success through customer
satisfaction
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– Employee performance
– Customer satisfaction
– profitability
Business orientations (1)

Production orientation
 Affordable
available products
 Prioritise production & distribution
efficiency
 Price sensitivity?
 Until 1950s
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Business orientations (2)

Sales orientation
 Selling
lines that are produced
 Customers encouraged to buy
 Personal selling/persuasive advertising
 1950s and 1960s
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Business orientations (3)

Product orientation
 Excellent,
well designed products
 Mass market appeal leads to production
orientation
 Fall in demand leads to sales orientation
 Until 1960s
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Business orientations (4)

Marketing orientation
 Customer
needs are focus of firm
 “Find a need and fill it”
 Flexible production/distribution methods
 Organisational philosophy
 Profitability rather than sales volume
 1970s onwards
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Business orientations (5)

Relationship marketing
 Building
long term relationships between
suppliers & customers
 Ensuring that interaction is a pleasurable
experience
 Customer service and attention focused
 Loyalty cards
 1980s onwards
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Business orientations (6)

Societal marketing
 Ethics
driven
 Considers needs of society as a whole
 Government pressure
 Pressure groups
 1990s onwards
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Marketing as an interface

Need to consider
 Future
customer needs
 Competition
 Relationships
 External environment
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Marketing management’s
responsibilities
To identify customer needs
 To meet them using the “marketing
mix”

 Product/Price/Place/Promotion
 Physical
 Process
 People
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evidence
Strategic vision
Look to the future
 Make well informed decisions
 Marketing myopia

 Organisation
describes itself in
PRODUCT rather MARKET terms
 Making slide rules?
Creating a competitive edge
 Look at the “mission statement”!

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Market segmentation
Categorising overall market for
products or services
 Consumer market segments
 Industrial/commercial market
segments
 HOW do we categorise?
 WHAT are the key features of the
segments?

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Consumer markets (1)

Demographic variables
 Age
 Sex
 Family
size
 Stage in family life cycle (DINKY, SAGA)
 Social class (A, B, C1, C2, D, E)
 Weight and size
 Income
 etc!
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Consumer markets (2)

Geodemographic
 Residential
neighbourhoods
 ACORN (Groups & types - see L & M)
 Pan-European (Hot chocolate - see B & P!)
– Moderns, go-betweens, traditionals
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Consumer markets (3)

Psychographic
 Activities
 Interests
 Attitudes,
beliefs & opinions
 Education (Terminal Education Age?)
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Consumer markets (4)

Behaviour segmentation
 Benefit
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sought (see MARVEL example in
L&M)
 End use (Soup?)
 Loyalty status (Hard-core, soft-core,
shifters, switchers)
 Usage rate
 Attitude
 Buyer readiness (Awareness, Interest,
Desire, Action)
Consumer markets (5)
Geographical
 Religious
 Cultural

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McCarthy’s four P’s
Product McCarthy E. J., “Organisation for new
product development?” in: Product
 Price
Strategy & Management (Libery &
 Place
Stuchman eds.) 1963
 Promotion
 Marketing planning needs to integrate
ALL these!
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Marketing planning
Analyse the environment
 Consider capabilities
 Decide on target markets
 Adapt marketing mix
 Meet customer needs
 Gain competitive advantage
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Planning stages
Where are we now?
 How did we get there?
 Where are we going?
 Where would we like to be?
 How might we get there? Choose a way?
 What will it be like? Will it be worth it?
 How will we know when we’re there?
 Are we on course?
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Marketing Audit
Monitors internal & external
environment
 First three stages of planning

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External Audit checklist

Macroenvironment
 Social,
Technological, Economic,
Political,Legal, Physical

The market
 size,
customers (who, when, what, why, how,
where) image, market segments, distribution

Competitors
 Who
are they? Objectives? Strengths &
weaknesses? Market share? Size? Entry
barriers?
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Internal audit checklist
Sales, market share, profit margins, costs
 Analysis of competitive position,
portfolio analysis
 Effectiveness of existing marketing mix
 Internal structures

 organisation,
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communications, training
Marketing information, control and
planning systems
SWOT analysis

Evaluates strategic position of the
business
 Strengths
(MATCH to opportunities)
 Weaknesses (turn into strengths?)
 Opportunities
 Threats (minimise or turn into
opportunities)
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RELATIVE to competitors!
Setting marketing objectives
Provide direction - WHAT are we
trying to achieve?
 Set in terms of products

 Development

of new or related
Or markets
 Penetration
of existing, new/related
markets

Or both
 Diversification/divestment/realignment
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Marketing strategy

HOW objectives will be achieved
 Which
target markets to enter/develop
 How will competitors be targeted?
 Competitive advantage?
– Better, faster, closer….
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Product development
Tutorial task
Look at your own organisation.
 What business orientation do you think it
has?
 What evidence is there of this?
 Tell us about your mission statement
 Tell us about your product/service
 Tell us about your customer focus
 Be prepared to discuss your answers next
week.

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Further reading
Brassington F & Pettitt S (2003),
Essentials of Marketing, Pearson
education Chapters 1, 5, 7-19 and 21
 CIM website

 http://www.cim.co.uk/home.aspx

Marketing law website
 http://www.marketinglaw.co.uk/
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