When you see this notation, it indicates a particularly important concept or idea that you

may want to stress in your lecture

LEARNING OBJECTIVES
After reading this chapter, students should:
Know why marketing is important
Know what is the scope of marketing
Know some fundamental marketing concepts
Know how marketing management has changed
Know what the necessary tasks are for successful marketing management
CHAPTER SUMMARY
From a managerial point of view, marketing is the process of planning and executing the
conception, pricing, promotion, and distribution of ideas, goods, and services to create
exchanges that satisfy individual and organizational goals. 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.
Marketers are skilled at managing demand. They seek to influence the level, timing, and
composition of demand. Marketers are involved in marketing many types of entities goods,
services, events, experiences, persons, places, properties, organizations, information, and
ideas. They also operate in four different marketplaces consumer, business, global, and
nonprofit.
!usinesses today face a number of challenges and opportunities including globalization, the
effects of advances in technology, and deregulations. They have responded by changing how
they conduct marketing in very fundamental ways.
There are five competing concepts under which organizations can choose to conduct their
business the production concept, product concept, selling concept, marketing concept, and the
holistic marketing concept. The first three are of limited use today.
The holistic marketing concept is based on the development, design, and implementation of
marketing programs, processes, and activities, that recognizes their breadth and interdepend"
encies. #olistic marketing recognizes that $everything matters% with marketing and that a
&'(
C H A P T E R
DEFINING MA!E"ING
F# "$E %&
'"
(EN")*
)hapter"by")hapter *nstructional Material
broad, integrated perspective is often necessary. Four components of holistic marketing are
relationship marketing, integrated marketing, internal marketing, and social marketing.
Marketing management has experienced a number of shifts in recent years as companies seek
marketing excellence.
The set of tasks necessary for successful marketing management include developing
marketing strategies and plans, connecting with customers, building strong brands, shaping the
market offerings, delivering and communicating value, capturing marketing insights and
performance, and creating successful long"term growth.
OPENING THOUGHT
Marketing is too often confused and identified with advertising or selling techni+ues, and our
practices and theories are all too often invisible to the average consumer. The instructor should
spend some class time differentiating between advertising,promotion techni+ues and
marketing. -tudents who are not marketing ma.ors will have some difficulty accepting the
encompassing role that marketing is now having on the other functional disciplines within a
firm. Finally, for those students who have never been exposed to marketing and its
components, the instructor/s challenge is to educate the students about the world of marketing.
The in"class and outside of class assignments noted in this text should help both educate and
excite the students about the $world of marketing%0
TEACHING STRATEGY AND CLASS ORGANIZATION
PROJECTS
&. 'emester+,ong Mar-eting .lan .ro/ect
1n effective way to help students learn about marketing management is through the actual
creation of a marketing plan for a product or service. This pro.ect is designed to
accomplish such a task.
2ividing the class into groups, have each group decide on a $fictional% consumer product
or service they wish to bring to market. 2uring the course of the semester, each of the
elements of the marketing plan, coordinating with the text chapter, will be due for the
instructor/s review. The instructor is encouraged to review each submission and suggest
areas for improvement, for more detailed study, or if acceptable to allow the students to
proceed to the next phase in development. -tudents can use the computer program
Marketing 3lan 3ro in creating their proposals and submissions and in their final
presentation4s5. 1t the end of the semester, each group is to present their entire marketing
plan to the class.
&'6
)hapter & 2efining Marketing for the 7&
st
)entury
The following is an outline of this process
Chapter # Title Elee!t "# the Mar$eti!% Pla! D&e
& 2efining Marketing for
the 7&
st
)entury
8one, group formation and begin the process
of selecting the product or service.
7 2eveloping Marketing
-trategies and 3lans
Formation of groups9 first presentation of
$product% to instructor for approval.
' :athering *nformation
and -canning the
;nvironment
)ompetitive information and environmental
scanning pro.ect4s5 completed and presented
for instructor/s review.
< )onducting Marketing
=esearch and
Forecasting 2emand
*nitial marketing research parameters
completed9 demand forecasted and target
market selections defined.
( )reating )ustomer
>alue, -atisfaction, and
?oyalty
-tudents should have completed their value
proposition for the fictional product, defined
how they will deliver satisfaction, and
maintain customer loyalty.
6 1nalyzing )onsumer
Markets
2efinitive data on the consumer for the
product,service including all demographic and
other pertinent information obtained and ready
for instructor/s approval.
@ 1nalyzing !usiness
Markets
8o report due for this chapter9 allows students
and instructor to $catch up% on the pro.ect.
A *dentifying Market
-egments and Targets
-pecific market segmentation, targeting, and
positioning statements by the students due .
B )reating !rand ;+uity 1t this point in the semester, students are to
have their $branding% strategy developed for
their pro.ect. Cuestions to have been
completed include the brand name, its e+uity
position, and the decisions in developing the
brand strategy.
&D )rafting the !rand
3ositioning
1t this point in the semester, student pro.ects
should be completed to include their fictional
product or service/s brand positioning. *n
relationship to the material contained in the
chapter, students should have delineated and
designed a differentiated brand positioning for
their pro.ect.
&& 2ealing with
)ompetition
1t this point in the semester"long pro.ect,
students should be prepared to present their
competitive analysis. Eho are the market
leaders for their chosen product or serviceF
Ehat niche have they identified for their
product,serviceF *s their product or service
going to be a leader, follower, or challenger to
&'@
)hapter"by")hapter *nstructional Material
well"established products or brandsF
&7 -etting 3roduct -trategy 1t this point for the semester"long pro.ect,
students should have set their group pro.ect/s
product or service strategy. *nstructors are to
evaluate their submissions on the product 4or
service5 features, +uality, and price and the
other considerations of $product% found in this
chapter.
&' 2esigning and
Managing -ervices
1t this point in the semester"long pro.ect,
those students who have selected a $service%
idea for the marketing plan must submit their
offering. -tudents whose pro.ect is a $product"
based% component do not have anything to
submit for this chapter.
&< 2eveloping 3ricing
-trategies and 3rograms
1t this point in the semester"long marketing
plan pro.ect, students should be prepared to
hand in their pricing strategy decisions for
their fictional product,service. *n reviewing
this section, the instructor should make sure
that the students have addressed all or most of
the material concerning pricing covered in this
chapter.
&( 2esigning and
Managing >alue
8etworks and )hannels
1t this point in the semester"long pro.ect,
students should present their channel decisions
for getting their product or service to the
consumer. *n evaluating this section, the
instructor should evaluate the completeness of
the pro.ects to the material contained in this
chapter.
&6 Managing =etailing,
Eholesaling, and
?ogistics
1t this point in the semester"long pro.ect for
the $fictional% product or service, students
should be directed to turn in their retailing,
wholesaling, and logistical marketing plans.
Those students who are acting in the role of
providing a new $service% should include here
their plans for locations, hours of operations,
and how their $service% plan/s on managing
demand and capacity issues.
&@ 2esigning and
Managing *ntegrated
Marketing
)ommunications
1t this point in the semester"long marketing
plan pro.ect, students should have agreed upon
their integrated marketing communications
matrix. The instructor is encouraged to
evaluate the submissions vis"G"vis the material
presented in this chapter. *n reviewing the
submissions, the instructor should evaluate the
continuity of the message across all possible
&'A
)hapter & 2efining Marketing for the 7&
st
)entury
communication media 4students will tend to
concentrate their media to television or to the
*nternet and exclude other forms such as
personal selling and radio5.
&A Managing Mass
)ommunications
1dvertising, -ales
3romotion, ;vents, and
3ublic =elations
1t this point in the semester"long pro.ect,
students should submit their advertising
program complete with ob.ectives, budget,
advertising message, and creative strategy,
media decisions, and sales and promotional
materials.
&B Managing 3ersonal
)ommunications 2irect
Marketing and the -ales
Force
1t this point in the semester"long pro.ect,
students who have decided to market their
product,service through direct market channels
should submit their proposals. 1ll other groups
must decide at this point if they will use a
direct sales force and if so to outline the
specifics 4including financials5 for this option.
7D *ntroducing 8ew Market
Hfferings
1t this point in the semester"long Marketing
3lan pro.ect, in this section should be a brief
write up by the students as to the consumer"
adoption process for their new product. #ow
will the consumer learn about their new
product and how +uickly will they adopt itF
Eill the product be targeted to the heavy users
and early adopters/ first, then early and late
ma.oritiesF Ehat is their estimated time for
full adoptionF
7& Tapping into :lobal
Markets
*f the pro.ect is to be exported to another
country, then student/s submissions regarding
how the product is to be distributed should be
included here9 otherwise this begins the
presentation phase of the pro.ect9 student
groups should begin their presentations to the
class.
77 Managing a #olistic
Marketing Hrganization
-econd phase of the presentations of the
pro.ect9 students should ensure that their
marketing plans contain a holistic view of the
marketing process.
Inder the pro.ects heading for each chapter will be a reminder of the material due when
that chapter is scheduled to be discussed in class.
7. #ave students 4in groups or individually5 select a local firm in their community, or a local
division of a national firm, and ask these executives how their firm has responded or is
responding to the &< ma.or shifts in marketing management today. The students can then
&'B
)hapter"by")hapter *nstructional Material
present these findings to the class in"group or by individual presentations. This could be a
full"semester pro.ect or limited to a few weeks of the semester.
ASSIGNMENTS
Sall Gr"&p A''i%!e!t'
&. *n small groups 4five students suggested as the maximum5, have students visit their local
coffee shop or -tarbucks and compare their local visit to the services provided in the
opening vignette of the chapter. 2oes their local -tarbucks or coffee shop contain wireless
*nternet accessF Ehat is the climate of the establishmentJfriendly or hurriedF *s
marketing prevalent in this establishmentF *f so, how and to what extent are they exposed
to marketing messagesJhave the students keep a list of every marketing message they
encounter.
7. *n small groups, ask the students to visit an on"campus eatery. 2uring this experience,
have the students keep a diary of their exposures to marketing messages. #ow are the
messages being communicatedJvisually through signs and posters, by sound, or via
verbal communicationF 1sk the students to break down these messages into &"minute
segments, and then total the amount of messages for the time spent in the eatery. Ehat
conclusions can you draw from the number of messages exposed to in the time period for
marketersF
I!(i)i(&al A''i%!e!t'
&. ;ach student is to select a company of their choosing and prepare a listing of all of the
marketing messages the company disseminates through their various communication
channels. The student is to examine the company/s pubic"relations messages, their
television advertising, *nternet advertising, and printed messages. -tudents should collect
this information and try to discover if there is a commonality of message, preference for
one form of communication over another 4by fre+uency5, or a series of nonrelated
messages.
7. -tudents can choose a firm of their preference, interview key marketing management
members and ask the firm how they are reacting to the changes in marketing management
for the 7&
st
century 4students should ask and have answers to all of the &< points listed in
the chapter5.
Thi!$*Pair*Share
&. #ave the students reflect upon their favorite product and,or service. Then have the
students collect marketing examples from each of these companies. This information
should be in the form of examples of printed advertising, copies of television
commercials, *nternet advertising, or radio commercials. 2uring class, have the students
share what they have collected with others. Cuestions to ask during the class discussion
should focus on why this particular example of advertising elicits a response from you.
Ehat do you like,dislike about this marketing messageF 2oes everyone in the class
like,dislike this advertisingF
&<D
)hapter & 2efining Marketing for the 7&
st
)entury
7. #ave the students visit a retail mall or other type of retail establishment. 2uring their visit,
have the students keep a log of the marketing messages they encounter. -uch messages
can be in the form of emotional advertising, price"point advertisements, store design and
layout, or sensual advertisements such as smell or sound. 1sk the students which retail
establishment enticed them the most and whyF #ave the students share these experiences
and ask the class if others in the class would be similarly affected 4male versus female for
example5.
MARKETING TODAYCLASS DISCUSSION TOPICS
Hne of the most challenging assignments for marketing managers is the marketing of a
nonprofit charitable organization. 1fter reading this chapter and learning about the challenges
facing firms in the 7&
st
century, how would you market the followingF
$Kou have been asked to develop a marketing plan for the local chapter of $Mothers 1gainst
2runk 2riving.% The goal is to develop a specific marketing message designed to educate
young people about the dangers and conse+uences of driving while intoxicated. The <3s of
marketing apply and yet each presents its own challenges in implementation. Ehich of the
<3s would you emphasize and whyF #ow would you develop a relationship with your target
marketF #ow would you integrate your marketing communicationsF Ehat aspect of the target
market needs 4stated, real, unstated, delight, and secret5 would you emphasize and whyF
Ehich of the shifts, in marketing management for the 7&
st
century, apply to this nonprofit
organization and whyF Ehich of these shifts in marketing management will make your task
more difficult and whyF%
END-OF-CHAPTER SUPPORT
S&%%e'ti"!' #"r U'e "# the Appli+ati"!,Di'+&''i"! -&e'ti"!'. These +uestions are meant to
challenge a student/s understanding of chapter material9 and to enable them to develop an
ability to use the chapter material to solve problems. The +uestions may be used purely for
discussion 4if so, they might be assigned in advance of the discussion5, they can be given to
selected students for in"class presentation, they can be used as short essay +uestions on in"
class +uizzes or on formal examinations, or they can be used by the students to enhance the
chapter summary. 1nswers are provided to each +uestion9 however, the answers are only
intended to be suggestions 4differing student answers should be .udged on their own meritJ
there is usually more than one creative way to answer these +uestions5. The +uestions were
designed to make the students think.
MAR/ETING DEBATE0D"e' Mar$eti!% Create "r Sati'#1 Nee('2
Marketing has often been defined in terms of satisfying customers/ needs and wants. )ritics,
however, maintain that marketing does much more than that and creates needs and wants that
did not exist before. 1ccording to these critics, marketers encourage consumers to spend more
money than they should on goods and services they really do not need.
&<&
)hapter"by")hapter *nstructional Material
"a-e a position: Marketing shapes consumer needs and wants versus marketing merely
reflects the needs and wants of consumers.
S&%%e'te( Re'p"!'e
3ro Eith the vast amount of information available to marketers today and the emphasis on
relational marketing, marketers are in more of a position to suggest needs and wants to the
public. )ertainly, not all consumers have all the needs and wants suggested by society today.
#owever, with the vast amount of exposure to these societal needs and wants via the media, a
substantial amount of consumers will, through mere exposure, decide that they $have% the
same needs and wants of others. Marketers by their efforts increase peer pressure, and group
thinking, by showing examples of what others may have that they do not. 1n individual/s
freedom to choose is substantially weakened by constant and consistent exposure to a range of
needs and wants of others. Marketers should understand that when it comes to resisting the
pressure to conform, that individuals are and can be weak in their resolve. Marketers must take
an ethical position to only market to those consumers able to purchase their products.
)on Marketing merely reflects societal needs and wants. The perception that marketers
influence consumers/ purchasing decisions discounts an individual/s freedom of choice and
their individual responsibility. Eith the advent of the *nternet, consumers have greater
freedom of choice and more evaluative criteria than every before. )onsumers can and do
make more informed decisions than previous generations. Marketers can be rightly accused of
influencing wants, along with societal factors such as power, influence, peer pressure, and
social status. These societal factors pre"exist marketing and would continue to exist if there
was no marketing efforts expended.
MAR/ETING DISCUSSION
)onsider the broad shifts in marketing. 1re there any themes that emerge to these shiftsF )an
they be related to the ma.or societal forcesF Ehich force contributed to which shiftF
S&%%e'te( Re'p"!'e
The ma.or themes that emerge in these broad shifts are technology, decentralization, and
empowerment. 1s companies face increased global competition, they are beginning to
increase their attention to all aspects of marketing and are beginning to encompass marketing
as a corporate goal and not .ust a departmental function.
The ma.or societal forces at work two"income families, increased technology, fewer firms,
increased consumer education, and empowerment are forcing companies and marketers to
shift their thinking about marketing and rethink their best business practices.
:lobal competition
&. From marketing does the marketing to everyone does the marketing.
7. From organization by products units to organizing by customer segments.
'. From being local to being $glocal%Jboth global and local.
<. *ncrease technology.
&<7
)hapter & 2efining Marketing for the 7&
st
)entury
(. From making everything to buying more goods and services from outside.
6. From emphasizing tangible assets to emphasizing intangible assets increasing
consumer expectations.
@. From relying on old market positions to uncovering new ones.
A. From building brands through advertising to building brands through performance and
integrated communications.
B. From attracting customers through stores and salespeople to making products
available online.
&D. From selling to everyone to trying to be the best firm serving a well"defined target
market.
&&. From focusing on profitable transactions to focusing on customer lifetime value.
&7. From focusing on the financial scorecard to focusing on the marketing scorecard.
&'. From a focus on gaining market share to a focus on building customer share.
&<. From focusing on shareholders to focusing on stakeholders.
&(. 2ecreased availability of firms.
&6. From using many suppliers to working with fewer suppliers in a $partnership.%
MAR/ETING SPOTLIGHT0C"+a*C"la
&. Ehat have been the key success factors for )oca")olaF
*ts pursuit of always looking for new ways to portray the brand, to keep the brand
$fresh% in the minds of current consumers without betraying the $core values.%
7. Ehere is )oca")ola vulnerableF
1 change in consumer tastes for soft drinks is vulnerability for )oca")ola.
1dditionally, as the brand expands into third"world countries, lifestyles and
customs provide challenges.
'. Ehat should they watch out forF
1ny demographic, or lifestyle changes that would have long"term conse+uences
would be a threat for the brand. Koung consumers must embrace the brand to
ensure that they continue to drink )oca")ola as they age. *f )oca")ola misses a
generation, sales will suffer for a long time.
<. Ehat recommendation would you make to their senior marketing executives going
forwardF
)ontinue to embrace the core values of the brand and expand soft drink sales
opportunities, not from the )oca")ola brand, but from flanker brands or
ac+uisitions. 3reserve the )oke franchise and defend it steadfastly.
&<'
)hapter"by")hapter *nstructional Material
(. Ehat should they be sure to do with their marketingF
;volve, adapt to changes in the consumer market by constantly monitoring
consumer buying habits, purchase intents, and their shifts in lifestyle priorities.
DETAILED CHAPTER OUTLINE
Mar-eting is e0erywhere1 Formally or informally, people and organi2ations engage in a
0ast num3er of acti0ities that could 3e called mar-eting1 Good mar-eting is no accident,
3ut a result of careful planning and e4ecution1 Mar-eting is 3oth an 5art6 and a
5science67there is constant tension 3etween the formulated side of mar-eting and the
creati0e side1
THE IMPORTANCE O3 MAR/ETING
Financial success often depends on mar-eting a3ility1 Many firms ha0e created a (hief
Mar-eting #fficer 8(M#9 to put mar-eting on an e:ual footing with other (hief
E4ecuti0es such as a (F# and (E#1 Mar-eting is tric-y and ma-ing the right
decisions is not always easy1 '-illful mar-eting is a ne0er+ending pursuit1
THE SCOPE O3 MAR/ETING
"o prepare to 3e mar-eters, you need to understand what mar-eting is, how it wor-s,
what is mar-eted, and who does the mar-eting.
4hat I' Mar$eti!%2
Mar-eting deals with identifying and meeting human and social needs1 #ne of the
shortest definition of mar-eting is 5meeting needs profita3ly16
15 The 1merican Marketing 1ssociation offers the following formal definition
$Marketing is the process of planning and executing the conception, pricing,
promotion, and distribution of ideas, goods, and services to create exchanges that
satisfy individual and organizational goals.%
!5 Mar-eting management is the art and science of choosing target markets and getting,
keeping, and growing customers through creating, delivering, and communicating
superior customer value.
)5 1 social definition of marketing is that $marketing is a societal process by which
individuals and groups obtain what they need and want through creating, offering, and
freely exchanging products and services of value with others.%
e0iew !ey Definitions here: mar-eting and mar-eting management
&<<
)hapter & 2efining Marketing for the 7&
st
)entury
E5+ha!%e a!( Tra!'a+ti"!'
E4change is the process of o3taining a desired product from someone 3y offering
something in return1 For e4change potential to e4ist, the following conditions must 3e
satisfied:
15 There are at least two parties.
!5 ;ach party has something that might be of value to the other party.
)5 ;ach party is capable of communication and delivery.
25 ;ach party is free to accept or re.ect the exchange offer.
;5 ;ach party believes it is appropriate or desirable to deal with the other party.
F5 ;xchange is a value"creating process because it normally leaves both parties better off.
:5 1 transaction is a trade of values between two or more parties and involves several
dimensions
&5 1t least two things of value.
75 1greed upon conditions.
'5 1 time of agreement.
<5 1 place of agreement.
#5 1 transaction differs from a transfer. *n a transfer, 1 gives L to ! but does not receive
anything tangible in return.
*5 Marketers seek to elicit a behavioral response from another party.
4hat I' Mar$ete(2
Mar-eting people are in0ol0ed in mar-eting ten types of entities: goods, ser0ices, e0ents,
e4periences, persons, places, properties, organi2ations, information, and ideas1
15 :oods
3hysical goods constitute the bulk of production and marketing efforts.
!5 -ervices
1 growing portion of business activities are focused on the production of services. The
I.-. economy today consists of a @DM'D services to goods mix.
)5 ;vents
Marketers promote time"based events such as trade shows, artistic performances, and
the Hlympics.
25 ;xperiences
!y orchestrating several services and goods, a firm can create and market experiences
such as Ealt 2isney Eorld/s Magic Kingdom.
&<(
)hapter"by")hapter *nstructional Material
;5 3ersons
)elebrity marketing is a ma.or business.
F5 3laces
)ities, states, regions, and whole nations compete actively to attract tourists, factories,
and new residents.
:5 3roperties
1re intangible rights of ownership of either real property 4real estate5 or financial
property 4stocks and bonds5.
#5 Hrganizations
1ctively work to build a strong, favorable, and uni+ue image in the minds of their
target publics.
*5 *nformation
)an be produced and marketed as a product. -chools, universities, and others produce
information and then market it.
N5 *deas
;very market offering includes a basic idea. 3roducts and services are platforms for
delivering some idea or benefit.
4h" Mar$et'2
Mar$eter' a!( Pr"'pe+t'
A mar-eter is someone see-ing a response 8attention, purchase, 0ote, donation, etc19
from another party called the prospect1
15 Marketers are responsible for stimulating demand for a company/s product.
!5 Marketing managers seek to influence the level, timing, and composition of demand to
meet the organization/s ob.ectives. ;ight demand states are possible.
&5 Negati0e demandJconsumers dislike the product and may even pay a price to
avoid it.
75 Non+e4istent demandJconsumers may be unaware or uninterested in the
product.
'5 ,atent demandJconsumers may share a strong need that cannot be satisfied by
an existing product.
<5 Declining demandJconsumers begin to buy the product less fre+uently or not at
all.
(5 Irregular demandJconsumer purchases vary on a seasonal, monthly, daily, or
even an hourly basis.
65 Full demandJconsumers are ade+uately buying all product put into the
marketplace.
&<6
)hapter & 2efining Marketing for the 7&
st
)entury
@5 #0erfull demandJtoo many consumers would like to buy the product that can be
satisfied.
A5 )nwholesome demandJconsumers may be attracted to products that have
undesirable social conse+uences.
Mar$et'
Economists descri3e a mar-et as a collection of 3uyers and sellers who transact o0er a
particular product or product class1
Figure &1& shows fi0e 3asic mar-ets and their connection flows1
Mar-eters use the term 5 mar-et6 to co0er 0arious groups of customers1 "hey 0iew the
sellers as constituting the industry and the 3uyers as constituting the mar-et1 "hey tal-
a3out need mar-ets, product mar-ets, demographic mar-ets, and geographic mar-ets1
'ee Figure &1% shows the relationship 3etween the industry and the mar-et1
15 -ellers and buyers are connected by flows
&5 -eller sends goods, services, and communications to the market.
75 *n return they receive money and information.
'5 There is an exchange of money for goods and services.
<5 There is an exchange of information.
e0iew !ey Definitions here: negati0e demand, non+e4istent demand, latent demand,
declining demand, irregular demand, full demand, o0erfull demand, and unwholesome
demand1
/e1 C&'t"er Mar$et'
15 )onsumer Markets
)onsumer goods and services such as soft drinks and cosmetics, spend a great deal of
time trying to establish a superior brand image.
!5 !usiness Markets
)ompanies selling business goods and services often face well"trained and well"
informed professional buyers who are skilled in evaluating competitive offerings.
)5 :lobal Markets
)ompanies face challenges and decisions regarding which countries to enter, how to
enter the country, how to adapt their products,services to the country, and how to price
their products.
25 8onprofit and :overnmental Markets
)ompanies selling to these markets have to price carefully because these organizations
have limited purchasing power.
&<@
)hapter"by")hapter *nstructional Material
MAR/ETPLACES6 MAR/ETSPACES6 AND METAMAR/ETS
"he mar-etplace is physical; the mar-etspace is digital1
Mohan 'awhney has proposed the concept of metamar-ets to descri3e a cluster of
complementary products and ser0ices that are closely related in the minds of consumers
3ut are spread across a di0erse set of industries1 An e4ample is the automo3ile industry
that consists of physical locations 8car dealers9 and mar-etspace locations 8Internet
locations9 that consumers use in deciding what car to purchase1
e0iew !ey Definitions here: mar-etplace7physical, mar-etspace7digital,
metamar-et73oth physical and digital
H"7 B&'i!e'' a!( Mar$eti!% Are Cha!%i!%
15 )hanging technology.
!5 :lobalization.
)5 2eregulation.
25 3rivatization.
;5 )ustomer empowerment.
F5 )ustomization.
:5 #eightened competition.
#5 *ndustry convergent.
*5 2isintermediation.
COMPANY ORIENTATIONS TO4ARD THE MAR/ETPLACE
"he competing concepts under which organi2ations ha0e conducted mar-eting
acti0ities include; the production concept, product concept, selling concept, mar-eting
concept, and holistic mar-eting concept1
Pr"(&+ti"! C"!+ept
15 The production concept holds that consumers will prefer products that are widely
available and inexpensive.
Pr"(&+t C"!+ept
15 The product concept holds that consumers will favor those products that offer the most
+uality, performance, or innovative features.
Selli!% C"!+ept
15 The selling concept holds that consumers and businesses, will ordinarily not buy
enough of the organization/s products, therefore, the organization must undertake
aggressive selling and promotion effort.
&<A
)hapter & 2efining Marketing for the 7&
st
)entury
Mar$eti!% C"!+ept
15 The marketing concept holds that the key to achieving organizational goals consists of
the company being more effective than competitors in creating, delivering, and
communicating superior customer value to its chosen target markets.
&5 =eactive market orientationJunderstanding and meeting consumers/ expressed
needs.
75 3roactive marketing orientationJresearching or imagining latent consumers/
needs through a $probe"and"learn% process.
a. )ompanies that practice both reactive and proactive marketing orientation are
implementing a total market orientation.
H"li'ti+ Mar$eti!% C"!+ept
$olistic mar-eting can 3e seen as the de0elopment, design, and implementation of
mar-eting programs, processes, and acti0ities that recogni2es the 3reath and
interdependencies of their efforts1 $olistic mar-eting recogni2es that 5e0erything
matters6 with mar-eting7the consumer, employees, other companies, competition, as
well as society as a whole1
e0iew !ey Definition here: holistic mar-eting
Figure &1< pro0ides a schematic o0er0iew of the four 3road themes characteri2ing
holistic mar-eting1
Relati"!'hip Mar$eti!%
51 elationship mar-eting has the aim of building mutually satisfying long"term
relationships with key partiesJcustomers, suppliers, distributors, and other marketing
partners. =elationship marketing builds strong economic, technical, and social ties
among the parties.
5& Marketing must not only do customer relationship management 4)=M5 but also
partnership relationship management 43=M5.
57 Four key constituents for marketing are
.a )ustomers.
.b ;mployees.
.c Marketing partners 4channel partners5.
.d Members of the financial community.
5' The ultimate outcome of relationship marketing is the building of a uni+ue
company asset called a mar-eting networ-1
A mar-eting networ- consists of the company and its supporting sta-eholders
8customers, suppliers, distri3utors, retailers, ad agencies, uni0ersity scientists, and
others9 with whom it has 3uilt mutually profita3le 3usiness relationships1
e0iew !ey Definitions here: relationship mar-eting and mar-eting networ-
&<B
)hapter"by")hapter *nstructional Material
I!te%rate( Mar$eti!%
51 The marketer/s task is to devise marketing activities and assemble fully integrated
marketing programs to create, communicate, and deliver value for consumers.
5! The <3s of marketing product, price, place, and promotion.
Figure &1= shows the particular mar-eting 0aria3les under each .1
Mar-eting7mi4 decisions must 3e made for influencing the trade channels as well as
the final consumers1
5& =obert ?auterborn suggests that the sellers <3s correspond to the customers/ <)s
<3s <)s
3roduct )ustomer solution
3rice )ustomer cost
3lace )onvenience
3romotion )ommunication
5) Two key themes of integrated marketing are
5& Many different marketing activities are employed to communicate and deliver
value.
57 1ll marketing activities are coordinated to maximize their .oint efforts.
Figure &1> shows the company preparing an offering mi4 of products, ser0ices, and
prices and utili2ing a communications mi4 of sales promotion, ad0ertising, sales force,
pu3lic relations, direct mail, telemar-eting, and interacti0e mar-eting to reach the trade
channels and the target customers1
I!ter!al Mar$eti!%
51 #olistic marketing incorporates internal mar-eting, ensuring that everyone in the
organization embraces appropriate marketing principles.
5! *nternal marketing must take place on two levels
5& 1t one level, the various marketing functions 4sales force, advertising, customer
services, product management, and marketing research5 must work together.
57 -econdly, marketing must be embraced by the other departmentsJthey must
$think customer.% Marketing is not a department so much as a company
orientation.
e0iew !ey Definition here: internal mar-eting
'ee "a3le &1& for assessing which company departments are customer minded1
&(D
)hapter & 2efining Marketing for the 7&
st
)entury
S"+ial Re'p"!'i8le Mar$eti!%
15 #olistic marketing incorporates social responsi3ility mar-eting and understanding
broader concerns, and the ethical, environmental, legal, and social context of
marketing activities and programs.
"a3le &1% displays some different types of corporate social initiati0es1
3UNDAMENTAL MAR/ETING CONCEPTS6 TRENDS6 AND TAS/S
"o understand the mar-eting function, we need to understand certain fundamental
concepts and tas-s, along with current trends1
C"re C"!+ept'
)reates foundations for marketing management and holistic marketing orientation.
Nee('6 4a!t'6 a!( Dea!('
Marketers must try to understand the target market/s needs, wants, and demands.
15 8eeds are basic human desires.
!5 Eants are shaped by one/s society.
)5 2emands are wants for specific products backed by an ability to pay.
25 Marketers do not create needsJneeds pre"exist marketers.
;5 Marketers, along with society influence wants.
&5 There are five types of needs that marketers must understand
a. -tated needs.
b. =eal needs.
c. Instated needs.
d. 2elight needs.
e. -ecret needs.
Tar%et Mar$et'6 P"'iti"!i!%6 a!( Se%e!tati"!
15 1 marketer can rarely satisfy everyone in a market therefore the marketers must divide
the market into segments.
!5 The marketer then decides which segment presents the greatest opportunityJwhich
are its target markets.
)5 For each chosen target market, the firm develops a market offering.
25 The offering is positioned in the minds of the target buyers as delivering some central
benefit4s5.
&(&
)hapter"by")hapter *nstructional Material
O##eri!%' a!( Bra!('
15 )ompanies put forth a value proposition, a set of benefits they offer to customers to
satisfy their needs.
!5 The intangible value proposition is made physical by an offering that can be a
combination of products, services, information, and experiences.
Val&e a!( Sati'#a+ti"!
15 The offering will be successful if it delivers value and satisfaction to the target buyer.
!5 The buyer chooses between different offerings based on which is perceived to deliver
the most value.
)5 >alue reflects the perceived tangible benefits and costs to customers.
25 >alue can be a combination of +uality, service, and prices called the customer value
triad.
;5 >alue is a central marketing concept.
F5 Marketing can be seen as the identification, creation, communication, delivery, and
monitoring of customer value.
&5 -atisfaction reflects a person/s comparative .udgment resulting from a product/s
perceived performance 4or outcome5 in relation to his or her expectations.
Mar$eti!% Cha!!el' 9three $i!(' "# ar$eti!% +ha!!el':
15 )ommunication channels deliver and receive messages from target buyers.
!5 2istribution channels to display, sell, or deliver the physical product or service4s5.
)5 -ervice channels to carry out transactions with potential buyers 4warehouses,
transportation companies, banks5.
S&ppl1 Chai!
15 2escribes a longer channel stretching from raw materials to finished goods.
!5 =epresents a value delivery system.
C"petiti"!
15 *ncludes all the actual and potential rival offering and substitutes that a buyer might
consider.
&(7
)hapter & 2efining Marketing for the 7&
st
)entury
Mar$eti!% E!)ir"!e!t
15 )onsists of the task environment and the broad environment.
!5 Task environment includes the immediate actors involved in producing, distribution,
and promoting the offering suppliers, company, dealers, and target customers.
)5 The broad environment consists of six components
&5 2emographic.
75 ;conomic.
'5 8atural.
<5 Technological.
(5 3olitical"legal.
65 -ocial"cultural.
Mar$eti!% Pla!!i!%
15 )onsists of analyzing marketing opportunities.
!5 -electing target markets.
)5 2esigning marketing strategies.
25 2eveloping marketing programs.
;5 Managing the marketing effort.
Figure &1? presents a grand summary of the mar-eting process and the forces shaping
the company@s mar-eting strategy1
Shi#t' i! Mar$eti!% Ma!a%ee!t
15 1 number of important trends and forces are eliciting a new set of beliefs and practices
on the part of business firms. These fourteen ma.or shifts are
&5 From marketing does the marketing to everyone does the marketing.
75 From organization by products units to organizing by customer segments.
'5 From making everything to buying more goods and services from outside.
<5 From using many suppliers to working with fewer suppliers in a $partnership.%
(5 From relying on old market positions to uncovering new ones.
65 From emphasizing tangible assets to emphasizing intangible assets.
@5 From building brands through advertising to building brands through performance
and integrated communications.
A5 From attracting customers through stores and salespeople to making products
available online.
&('
)hapter"by")hapter *nstructional Material
B5 From selling to everyone to trying to be the best firm serving a well"defined target
market.
&D5 From focusing on profitable transactions to focusing on customer lifetime value.
&&5 From a focus on gaining market share to a focus on building customer share.
&75 From being local to being $glocal%Jboth global and local.
&'5 From focusing on the financial scorecard to focusing on the marketing scorecard.
&<5 From focusing on shareholders to focusing on stakeholders.
Mar$eti!% Ma!a%ee!t Ta'$'. Ze&' I!+;
!5 2eveloping marketing strategies and plans 4)hapter 75.
)5 )onnecting with customers 4)hapters ', <, and (5.
25 !uilding strong brands 4)hapters @, A, and B5.
;5 -haping the market offerings 4)hapters &D, &&, and &75.
F5 2elivering value 4)hapters &' and &<5.
:5 )ommunicating value 4)hapters &(, &6, and &@5.
#5 )apturing marketing insights and performance 4)hapters &A and &B5.
*5 )reating successful long"term growth 4)hapters 7D, 7&, and 775.
&(<