8/10/2019 Ebert Griffin PP10

1/28

Fourth Edition

Copyright 2003 Prentice Hall, Inc.

PART 4 . . . . . . . . . . . . . . . . . . . . . . . .

Understanding Principles of Marketing

8/10/2019 Ebert Griffin PP10

2/28

Copyright 2003 Prentice Hall, Inc. 10 - 2

Chapter 10

Understanding Marketing

Processes and ConsumerBehavior

8/10/2019 Ebert Griffin PP10

3/28

Copyright 2003 Prentice Hall, Inc. 10 - 3

In our factory, we make

lipstick. In our advertising,

we sell hope.

~Charles RevsonRevlon Cosmetics

8/10/2019 Ebert Griffin PP10

4/28

Copyright 2003 Prentice Hall, Inc. 10 - 4

Key Topics

Definition of marketing

The external marketing environment

Segmentation and target marketing

The consumer buying process

Organizational markets and buying behaviorConsumer and industrial products

Branding and packaging

8/10/2019 Ebert Griffin PP10

5/28

Copyright 2003 Prentice Hall, Inc. 10 - 5

What Is Marketing?

Planning and executing the conception, pricing,

promotion, and distribution of ideas, goods, and

services to create exchanges that satisfy individualand organizational objectives

Finding a need and filling it!

OR

8/10/2019 Ebert Griffin PP10

6/28

Copyright 2003 Prentice Hall, Inc. 10 - 6

The Influence of Marketing

Permeates Everyday Life

Goods

Consumer

Industrial

Services

Ideas Relationship marketingemphasizes lasting

relationships with

customers and suppliers

8/10/2019 Ebert Griffin PP10

7/28Copyright 2003 Prentice Hall, Inc. 10 - 7

Competitive

Environment

Political& Legal

Environment

Social &Cultural

Environment

Economic

Environment

TechnologicalEnvironment

The External Environment

Shapes Marketing Programs

The Firm & It's Marketing Plan

Plans Strategies

Decisions

8/10/2019 Ebert Griffin PP10

8/28Copyright 2003 Prentice Hall, Inc. 10 - 8

Substitute product competition

Brand competition

International competition

The Competitive Environment

Drives Marketing Decisions

8/10/2019 Ebert Griffin PP10

9/28Copyright 2003 Prentice Hall, Inc. 10 - 9

Marketing MixThe Four Ps

(Distribution)

roduct

ricing

romotion

lace

8/10/2019 Ebert Griffin PP10

10/28Copyright 2003 Prentice Hall, Inc. 10 - 10

The Promotional Mix

Advertising

PersonalSelling

SalesPromotions

Public

Relations

8/10/2019 Ebert Griffin PP10

11/28Copyright 2003 Prentice Hall, Inc. 10 - 11

Market Segmentation & Target Marketing

Market Segmentation

Dividing a market into

customer categories

Target Marketing

Selecting a category ofcustomers with similar wantsand needs who are likely torespond to the same products

8/10/2019 Ebert Griffin PP10

12/28Copyright 2003 Prentice Hall, Inc. 10 - 12

Identifying Market Segments

Psychographic

Variables

Geographic

Variables

Demographic

Variables

8/10/2019 Ebert Griffin PP10

13/28Copyright 2003 Prentice Hall, Inc. 10 - 13

Consumer Behavior

Psychological Influences

Personal InfluencesSocial Influences

Cultural Influences

Why do

consumers

purchase and

consume

products?

8/10/2019 Ebert Griffin PP10

14/28Copyright 2003 Prentice Hall, Inc. 10 - 14

PostpurchaseEvaluation

PurchaseDecision

Evaluation ofAlternatives

The Consumer Buying Process

InformationSeeking

ProblemRecognition

Psychological Personal Social Cultural

Personal & Environmental Factors

Product Pricing Promotion Place

Marketing Factors

8/10/2019 Ebert Griffin PP10

15/28Copyright 2003 Prentice Hall, Inc. 10 - 15

Organizational Markets

Industrial

Market

Government &

Institutional Market

Reseller

Market

8/10/2019 Ebert Griffin PP10

16/28Copyright 2003 Prentice Hall, Inc. 10 - 16

Organizational Buying Behavior

Differences in buyers

Professionals

Specialists

Experts

Differences in buyer/seller relationships

8/10/2019 Ebert Griffin PP10

17/28Copyright 2003 Prentice Hall, Inc. 10 - 17

Product Features and Benefits

Features

Tangible and intangible

qualities that a companybuilds into its products

Benefits

The results of using

those products

8/10/2019 Ebert Griffin PP10

18/28Copyright 2003 Prentice Hall, Inc.10 - 18

Classifying Products

Consumer

Convenience GoodsShopping Goods

Specialty Goods

Industrial

Expense ItemsCapital Items

8/10/2019 Ebert Griffin PP10

19/28Copyright 2003 Prentice Hall, Inc. 10 - 19

Product Offerings

Product Line

A group of similar products, intended for similar

buyers, who will use them in similar ways.

Product Mix

The total group of products that a company offers

for sale.

8/10/2019 Ebert Griffin PP10

20/28Copyright 2003 Prentice Hall, Inc. 10 - 20

Developing New Products

The New Product Development Process

Product Mortality Rates

Strategy of introducing new products to respond

quickly to customer or market changes

8/10/2019 Ebert Griffin PP10

21/28Copyright 2003 Prentice Hall, Inc. 10 - 21

Creating Product Brands

Branding

Using symbols to communicate the qualities

of a given product to create loyal consumers

Types of Brands:

National Brands

Licensed Brands

Private Brands

8/10/2019 Ebert Griffin PP10

22/28Copyright 2003 Prentice Hall, Inc. 10 - 22

The Worlds 10 Most Valuable Brands

1. Coca Cola

2. Microsoft

3. IBM

4. GE

5. Nokia

6. Intel

7. Disney

8. Ford

9. McDonalds

10.AT&T

Source: The Best Global Brands,BusinessWeek, August 6, 2001

8/10/2019 Ebert Griffin PP10

23/28Copyright 2003 Prentice Hall, Inc. 10 - 23

The Future of Top Brands

Gaining Value

Starbucks +32%

Samsung +22%

Financial Times +14%

GE +11%

Guinness +11%

Losing Value

Xerox -38%

Amazon.com -31%

Yahoo! -31%

Duracell -30%

Ford -17%

Source: The Best Global Brands, BusinessWeek, August 6, 2001

8/10/2019 Ebert Griffin PP10

24/28Copyright 2003 Prentice Hall, Inc. 10 - 24

Product Packaging

Attracts consumers

Displays brand name

Protects contentsSupplies information

Communicates features

and benefitsProvides features and

benefits (e.g. easy pourspout)

8/10/2019 Ebert Griffin PP10

25/28

Copyright 2003 Prentice Hall, Inc. 10 - 25

The International Marketing Mix

PRODUCTS

PRICING

PROMOTIONDISTRIBUTION

8/10/2019 Ebert Griffin PP10

26/28

Copyright 2003 Prentice Hall, Inc. 10 - 26

Small Business and the Marketing Mix

Products

Pricing

Promotion

Distribution

8/10/2019 Ebert Griffin PP10

27/28

Copyright 2003 Prentice Hall, Inc. 10 - 27

Chapter Review

Define marketing

Describe the forces of the external marketing

environment

Explain market segmentation and target

marketing

Describe the consumer buying process

Discuss the organizational market categories

8/10/2019 Ebert Griffin PP10

28/28