Marketing

Marketing (Philipp Kottler) - 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 objectives.

The goal of marketing

• to create customer satisfaction profitably by building value-laden relationships with important customers.

The core marketing concepts are:

A human need is a state of felt deprivation.

Human wants — the form taken by human needs as they are shaped by culture and individual personality.

Demands. When backed by buying power, wants become demands. People want to choose products that provide the most satisfaction for their money.

Products. Human needs, wants, and demands suggest that there are products available to satisfy them. A product is anything that can be offered to a market for attention, acquisition, use, or consumption and might satisfy a need or want.

Exchange is the act of obtaining a desired object from someone by offering something in return. Exchange is only one of many ways people can obtain a desired object. Exchange is also the core concept of marketing.

Transactions. A transaction consists of a trade of values between two parties. There are monetary transactions which involve changing products for money.

The concept of transactions leads to the concept of a market.

Markets. A market is the set of actual and potential buyers of a product.

As the number of persons and transactions increases in a society, the number of merchants and marketplaces also increases.

A market can grow up around a product, a service, or anything else of value.

• labor market consists of people who are willing to offer their work in return for wages or products. In fact, various institutions, such as employment agencies and job-counseling firms, will grow up around a labor market to help it function better.

• money market is another important market that emerges to meet the needs of people so that they can borrow, lend, save, and protect money.

• donor market has emerged to meet the financial needs of nonprofit organizations.

Marketing means working with markets to bring about exchanges for the purpose of satisfying human needs and wants.

• A seller’s market is one in which sellers have more power and buyers must be the more active «marketers.»

• In a buyer’s market, buyers have more power and sellers have to be more active «marketers.»

There are 10 types of entities in marketing: goods, services, experiences, events, persons, places, properties, organizations, information and ideas.

Marketing management & strategic planning

Marketing management - is the analysis, planning, implementa­tion, and control of programs designed to create, build, and maintain beneficial exchanges with target buyers for the purpose of achieving organizational objectives.

There are 5 alternative concepts under which organizations conduct their marketing activities:

1.The production concept holds that consumers will favor products that are available and highly affordable and that management should therefore focus on improving production and distribution efficiency. This concept is one of the oldest philosophies guiding sellers. The production concept is a useful philosophy in two types of situations.

1. occurs when the demand for a product exceeds the supply. Here, management should look for ways to increase production.

2. occurs when the product’s cost is too high and improved productivity is needed to bring it down.

2.The product concept holds that consumers will favor products that offer the most quality, performance, and features, and that an organization should thus devote energy to making continuous product improvements.

The product concept can also lead to «marketing myopia». Marketing myopia is the situation when a company is unable to respond changing needs and wants, to predict it.

3.The selling concept holds that consumers will not buy enough of the organization’s products unless it undertakes a a large selling and promotion effort. The concept is typically practiced with unsought goods—those that buyers do not normally think of buying (say, encyclopedias and funeral plots). These industries must be good at tracking down prospects and selling them on product benefits.

The selling concept is also practiced in the nonprofit area.

Surprisingly, this concept is a relatively recent business philosophy. It emerged only during the 1950-s.

4.The marketing concept holds that achieving organizational goals depends on determining the needs and wants of target markets and delivering the desired satisfactions more effectively and efficiently than competitors. This concept is rather recent.

There are three pillars to the marketing concept:

(1) consumer orientation - dimension of the marketing concept argues that a firm can be more successful if it determines what the consumer needs and wants before it decides what product to produce and/or sell.

(2) integrated or total company effort - departments within the organization work together toward the common goal of satisfying the customer. Integrated effort is a systems point of view, in which all departments recognize they are interdependent parts of an organization.

(3) achievement of organization goals - states that the organization should engage in exchanges based on their potential for helping the organization achieve its goals.

5.The societal marketing concept holds that the organization should determine the needs, wants, and interests of target markets.

Strategic planning is the process of developing and maintaining a strategic fit between the organization’s goals and capabilities and its changing marketing opportunities. It relies on developing a clear company mission, supporting objectives, a sound business portfolio, and coordinated functional strategies. It consists of: (1)ANALYSIS and (2)STRATEGY.

Strategic fit:

1. analyses its present position and defines its overall purpose and mission. This mission is then turned into detailed supporting objectives that guide the whole company.

2. headquarters decides what portfolio of businesses and products is best for the company and how much support to give each one.

(1) ANALYSIS consists of identifying the firms Strengths and Weaknesses as well as Opportunities and Threats (SWOT analysis).

Strengths and weaknesses

• can be identified and analyzed by studying performance trends, resources, and capabilities.

• past performance typically is measured in financial terms, such as sales and profits.

• company has to study current resources and capabilities:

• special talents

• areas of expertise

• unique assets

• other advantage that can be drawn on for support.

Opportunities and threats

• can be identified by stating the organization’s mission and objectives and engaging in the process of environmental scanning.

• marketer wants to identify market opportunities that exist because there is an unmet or unsatisfied need or want

• marketer should try to convert threats into opportunities.

(2) STRATEGY consists of 4 core steps (Make-up of the company)

Defining the Company Mission

Setting Company Objectives and Goals

Designing the Business Portfolio

Analyzing the Current Business Portfolio