MKT320F Miller Exam 1 Textbook Study Notes PDF

Preview

Summary

descriptive notes from MKT textbook 17th edition - Exam 1...

Description

Exam 1 Book Notes Foundations of Marketing | MKT 320F Marketing The University of Texas at Austin 20 pag.

Document shared on www.docsity.com Downloaded by: jacquelynwelsh ([email protected])

Marketing Exam 1 Book Notes Chapter 1

Marketing- What’s It All About?  Customer satisfaction- the extent to which a firm fulfills a customer’s needs, desires, and expectations. o Analyze needs of people o Predict what products different customers will want and what target market the firm want’s to isolate o Estimate how many in target market will purchase product o Determine which region the product would sell the most efficiently and what time of month/year sales would be the most profitable o Estimate price that consumers are willing to pay and at what price the firm can make a profit. o Determine types of promotion that best brands the product. o Estimate competition o Determine how to provide service post-purchase.  The above are not part of production which is the actual making of good or performing services is. They are part of marketing  Marketing provides the needed direction for production and helps make sure that right goods and services are produced and find their way to consumers  Marketing plays an essential role in providing consumers with goods and services which they need and focuses on customer satisfaction  Customer satisfaction is where a firm fulfils a customer's needs, desires, and expectations Marketing is important to you  Marketing drives organizations to focus on what is necessary to satisfy the customer  Marketing= 50 cents of every dollar  Marketing plays a big role in economic growth and development  Marketing encourages research and innovation which is the spread of new ideas, goods, and services  Choices lead to competition and competition drives the prices down  When firms develop products which satisfy the consumer, it results in fuller employment and higher incomes Marketing Defined  Marketing is a set of activities done by an individual organization to satisfy its customers  Marketing is an important social process since a society needs some sort of marketing system to organize the efforts of all the producers, wholesalers, and retailers to satisfy the needs of its citizens  Micro- set of activities performed by organizations  Macro- social process

1

Document shared on www.docsity.com Downloaded by: jacquelynwelsh (jacquelynbwelsh@gmail com)

Marketing Exam 1 Book Notes 

      

 



Marketing is the performance of activities that seek to accomplish an organization’s objectives by anticipating customer or client needs and directing a flow of need-satisfying goods and services from producer to customer or client. o Profit and non-profit: not only profit-centered, but seek to gain more members or acceptance of a set of information. Customers may be individual consumers, firms nonprofit organizations, govt agencies or foreign nations Most customers pay for goods and services they receive, others receive for free, while some get it for reduced cost thru pvt or govt support Aim of marketing is to identify cusomters needs and meet those needs Attempts to create a product that “sells itself” Begins with potential customer needs, not production process Marketing should try to anticipate needs They determine what goods and servies should be produced, product design and packaging , price or fees, credit and collection policies, transportation and storage policies, advertising and sales policies, installation, customer service, warranty, and disposal of product Works in conjunction with accounting, production, and financial management Marketing doesn’t occur unless two or more parties are willing to exchange something for something else. o Pure subsistence economy- each family unit produces everything it consumes so there is no need to exchange goods and services and no marketing is involved Relationship with customer is ongoing, not a single transaction

Macro-Marketing  Social process that directs an economy’s flow of goods and services from producers to consumers in a way that effectively matches supply and demand. o With macro marketing the focus is not on the activities of individual organization but is on how the whole marketing system works which includes looking at how marketing affects society and vice versa o Emphasizes the entire market o Helps match supply and demand and society’s objectives o Within every society o Time, place, price point, and satisfaction pre/post purchase o Separation between producers and consumers  Economies of scale- as a company produces larger numbers of a particular product, the cost of each unit of the product goes down. o Discrepancies of Quantity is in which producers prefer to produce and sell in large quantities while consumers prefer to buy and consume in small quantities

2

Document shared on www.docsity.com Downloaded by: jacquelynwelsh (jacquelynbwelsh@gmail com)

Marketing Exam 1 Book Notes o Discrepancies of Assortment is that producers specialize in producing a narrow assortment of goods and services. Consumers need a broad assortment o Spatial separation is that producers tend to locate where it is economical to produce while consumers are located in many scattered places o Separation in Time is that consumers may not want to consume goods and services at the time producers would prefer to produce them and time may be required to transport goods from producer to consumer o Separation of Information is that producers do not know who needs what, where, when and at what price o Separation in Values is that producers value goods and services in terms of costs and competitive prices. Consumers value them in terms of satisfying needs and their ability to pay o Separation of Ownership is that producers hold title to goods and services they themselves do not want to consume. Consumers want goods and services that they do not own o Marketing is needed to overcome discrepancies and separations o Production sector wants specialization and division of labor which results in heterogeneous supply capabilities o Consumption Sector is the heterogeneous demand for different goods and services and when and where they need to be to satisfy needs and wants o Macro-marketing overcomes separations of quantity/assortment discrepancies and spatial/time/information/value/ownership separation  Each producer specializes in producing and selling large amounts of a narrow assortment of goods and services, but each consumer wants only small quantities. o Universal Functions of Marketing  Buying- looking for and evaluating goods and services  Selling-promoting the product through personal selling, advertising, customer service, and direct/mass selling methods  Transporting-movement of goods from one place to another  Storing- holding goods until a customer needs them  Standardization and grading- sorting products according to size and quality. Reduces need for inspection  Financing- provides necessary cash and credit to fund  Risk taking- uncertainties of market and product condition  Market information- collection, analysis, and distribution of information needed to market an effective product. o Intermediary- specializes in trade rather than production. Exchanges product from producer to consumer. For example well stocked local grocery store o Two basic types of intermediaries are retailers and wholesales 3

Document shared on www.docsity.com Downloaded by: jacquelynwelsh (jacquelynbwelsh@gmail com)

Marketing Exam 1 Book Notes o Collaborators- firms that facilitate or provide one or more of the marketing functions other than buying or selling  Advertising, market research firms, independent producttesting labs o E-commerce-exchanges between individuals based on applications of information technology  Examples: Amazon, eBay etc. Marketing in Economic Systems  Economic system- organization to use scarce resources to produce goods and services, distribute them for consumption. Command and market. NO economy is purely one. Always a mix o Command economy- government officials mandate production and distribution. Also called planned economy. Little choice on what goods or services to produce. Prices set by government and are not decided by the demand and supply o Market-directed economy- individual decisions of producers and consumers in the market control through actions and decisions.  Consumers decide what is to be produced and by whom  Price is a measure of value: correlates with how society measures a good.  Greatest freedom of choice-not forced to buy goods except national services like national defense, schools, police, roads  Role of government- enforces “rules of the game”. Sets up interest rate and supply of money o Model of a market directed macro marketing system  Starts with many individual producers ( heterogeneous supply)  Then it is divided into intermediaries and collaborators  Then both of them perform universal marketing functions  These marketing functions try to overcome discrepancies and separation of producers and consumers and is monitors by government and public interest groups  The above process is done to create value and direct flow of need satisfying goods and services  Ends with many individual consumers ( heterogeneous demand)  5 stages in marketing era are as follows  Simple trade era- time when families traded or sold their “surplus” output to local distributors  Production era-company focuses on production of a few specific products.  Sales era- emphasizing selling because of increased competition  Marketing department era- marketing activities brought under control of one department to improve short-run  Marketing company era-development of long-range plans

4

Document shared on www.docsity.com Downloaded by: jacquelynwelsh (jacquelynbwelsh@gmail com)

Marketing Exam 1 Book Notes Marketing Concept  Marketing concept- aims all its efforts at satisfying customers at a profit  Product orientation-easily produce products made then attempt to sell  Marketing orientation- carry out marketing concept  Three ideas o Customer satisfaction o Total company effort o Profit Marketing Concept and Customer Value  Customer satisfaction=profit  Production orientation is making products which are easy to produce and then try selling them  Marketing orientation is replacing production orientation. Marketing orientation means to carry out marketing concept which means that instead of selling customers what the firm has produced, the firm tries to offer customers what they need  3 ideas of marketing concept are customer satisfaction, total company effort, and profits  Production orientation lacks focus  Firms which do not face much competition tend to be production orientated while businesses which face competition aim for the marketing concept  See the table on page 18  Consumer value-difference between benefits a customer sees from a market offering and costs of obtaining said benefits  To satisfy a customer the following needs to be done  Total company efforts to satisfy customers---> offer superior customer value ---> attract customers----> satisfy customers-----> retain customers----> increase sales to customers----> build profitable relationships with customers  Nonprofit organizations do not measure profit in the same way as a firm  When there is some measure(s) of long run success, it helps the organization focus its efforts  Micro-macro dilemma is that what is good for some firms and consumers may not be good for the society as whole  Marketing managers should be concerned with social responsibility which is a firms obligation to improve its positive effects on society and reduce its negative effects  Marketing ethics is the moral standards that guide marketing decisions and actions  Norms are established standards of conduct that are expected and maintained by society and/or professional organizations  Values represent the collection conception of what communities find desirable, important, and morally proper

5

Document shared on www.docsity.com Downloaded by: jacquelynwelsh (jacquelynbwelsh@gmail com)

Marketing Exam 1 Book Notes 

Competition: evaluate competition products and find ways to increase consumer value

Chapter 2                      

Marketing concept is to satisfy customers at a profit Marketing management process is the process of planning and marketing activities, directing the implementation of the plans, and controlling these plans Marketing, implementing and controlling is the basic job of all managers In marketing planning, mangers set objectives, evaluate opportunities , create marketing strategies, prepare marketing plans, and develop marketing programs Then implement marketing plans and program Then control marketing plans and program by measuring results and evaluating progress and adjust plans as needed Strategic( management) planning is the managerial process of developing and maintaining a match b/w an organizations resources and its market opportunities This is a top management job and it includes planning not for marketing but also for production, finance and other areas Company plans should be market-oriented Marketing strategy planning means finding attractive opportunities and developing profitable marketing strategies Marketing strategy species a target market and a related marketing mix 2 parts of this strategy are target market and marketing mix Target market is a fairly homogeneous group of customers to whom a company wishes to appeal Marketing mix is the controllable variables that company puts together to satisfy the target group Target customer denoted by a C is at the center and is surrounded by controllable variables which are called marketing mix A typical marketing mix includes product, price, promotion, and place Marketing strategy specifies some particular target customers This approach is called target marketing to distinguish it from mass marketing Target marketing says that a marketing mix is tailored to fit some specific target customers Mass marketing is the typical production orientated approach and its aims at everyone with the same marketing mix Mass marketing assumes everyone is same and considers everyone to be a potential customer Target marketing is called rifle approach while mass marketing is called the shotgun approach

6

Document shared on www.docsity.com Downloaded by: jacquelynwelsh (jacquelynbwelsh@gmail com)

Marketing Exam 1 Book Notes 

               

     

Production oriented manager sees everyone as similar and practices mass marketing while marketing oriented manager sees everyone as different and practices target marketing Mass marketing means trying to sell to everyone while mass marketers like Walmart are aiming at clearly defined target markets Target marketing is not limited to small market segments but only to homogenous ones 4 basic variables of marketing mix are product, place, promotion and price They are also called the 4 P's of marketing mix Customer is not part of the marketing mix but customer should be the target of all marketing efforts Product area is concerned with developing the right product for the target market. This area also includes branding, packaging, and warranties Place is concerned with getting the right product to the target markets place Product reaches the customer through a channel of distribution Channel of distribution is any series of firms that participate in the flow of products from producer to final user of consumer Promotion is concerned with telling the target market or others in the channel of distribution about the right product Personal selling involves direct spoken communication between sellers and potential customers. This may happen face to face, over the telephone or over the internet Customer service is a personal communication b/w a seller and a customer who wants to resolve a problem with the purchase Mass selling is communicating with large number of customers at the same time Main form of mass selling is advertising which is any paid form of nonpersonal presentation of ideas and goods Publicity is any unpaid form of nonpersonal presentation of ideas and is part of mass selling Sales promotion refers to those promotion activities other then advertising, publicity, and personal selling. For example coupons, samples, contests, catalogs and others Product is developed to satisfy the target customer, we find ways to reach our target customers place, we use promotion to tell the target customers about the product designed for them and then we set a price Selecting a target market and developing a marketing mix are interrelated The traditionalists wanted a well known brand that had a reputation for quality even if it was a bit more expensive Economy oriented were in lower income groups. They want basic items at a low price. Name brand didn't have much appeal. Willing to shop around and look for promotions and discounts Fashion conscious want fit (size wise) products and colorful. They wanted baby size version of goods which were available in adult sizes Attentive parents want items that meet a variety of needs

7

Document shared on www.docsity.com Downloaded by: jacquelynwelsh (jacquelynbwelsh@gmail com)

Marketing Exam 1 Book Notes 

  

 

     

      

items should be fun and fashionable and functional. They will buy products from specialized stores and were upscale shoppers. If the right product is found they will pay the premium price Marketing plan is a written statement of a marketing strategy and the time needs for carrying out the strategy It states what marketing mix will be offered, to whom, and for how long. It also states what costs will be incurred and what resources will be used and it states the results in terms of profits which should be expected After the marketing plan is developed, the manager is concerned with implementation which is putting marketing plans into operation. Strategies only work out as planned when they are effectively implemented Operational decisions are short run decisions to help implement strategies The control job provides feedback that leaders managers to modify their marketing strategies. To maintain control, a marketing manager uses a number of tools which include surveys, and sales and accounting analysis of profits and expenses Marketing program blends all of the firms marketing plans into one big plan Customer equity is the expected earning of a firms current and prospective customers over some period of time Profit is the difference between the firms revenue and total expenses incurred while making those sales Breakthrough opportunities are opportunities are opportunities that help innovators develop hard to copy marketing strategies that will very profitable for a long time Competitive advantage means that a firm has a marketing mix that the target market sees as a better than a competitor's mix Understanding customers is at the heart of using market segmentation to narrow down to a specific target market. Segmentation helps a manager decide to serve some segments- subgroups of customers and not others Differentiation means that the marketing mix is distinct from and better than what is available from a competitor SWOT analysis identifies and lists the firms strengths, weakness, opportunities and threats Market penetration, market development, product development and diversification are the four basic types of opportunities Market penetration means trying to increase sales of a firm's present products in its present markets probably through a more aggressive marketing mix Market development means trying to increase sales by selling present products in new markets Product development means offering new or improved products for present markets Diversification means moving into totally different lines of business and they may be unfamiliar...