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CHAPTER
Overview of Marketing
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Copyright © 2014 by the McGraw-Hill Companies, Inc. All rights reserved.McGraw-Hill/Irwin
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LEARNING OBJECTIVESLEARNING OBJECTIVES
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Define the role of marketing in organizations.
Describe how marketers create value for a product or service.
Understand why marketing is important both within and outside the firm.
Overview of Marketing
LO1
LO2
LO3
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What is Marketing?
Marketing is an organizational function and a set of processes for creating, capturing, communicating, and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders.
Marketing is an organizational function and a set of processes for creating, capturing, communicating, and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders.
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Marketing is about Satisfying Customer Needs and Wants
What group is Pepsi targeting with this ad?
What other benefits of soft drinks might Pepsi advertise?
What groups might these benefits appeal to?
PRNewsFoto/PepsiCo; AP Photo.
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Marketing Entails an Exchange
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Marketing Requires Product, Price, Place, and Promotion Decisions
Product
Creating value
PRNewsFoto/PepsiCo;AP Photo.
Price
Capturing value
©Digital Vision Ltd.
Place
Delivering value
©BrandX/JupiterImages/Getty Images.
Promotion
Communication value
©Stockbyte/PunchStock.
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Product: Creating Value
The fundamental purpose of Marketing is to create value by developing a variety of offerings, including goods, services, and ideas, to satisfy customer needs.
Royalty-Free/Corbis
Roz Wodward/Getty Images
Flying Colours Ltd./Getty Images
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Price: Capturing Value
Price is everything a buyer gives up (money, time, energy) in exchange for the product.
How much are customers willing to pay and can a profit can be made at that point.
AP Photo/The Canadian Press, Jacques Boissinot.
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Place: Delivering the Value Proposition
Place, or supply chain management, describes all activities necessary to get the product to the right customer when the customer wants it.
Where would you find this product in the store?
Courtesy Horizon Organic Dairy
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Promotion: Communicating Value
Promotion is communication by a marketer that informs, persuades, and reminds potential buyers about a product or service to influence their opinions or elicit a response.
Photo by Paul Hawthorne/Getty Images
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Marketing Can be Performed by Individuals and Organizations
ETSY Website
C2C
Consumer B
B2C
Consumer A
B2B
Retailer (Sells PCs &
monitors)
Manufacturer (Makes monitors)
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Marketing Impacts Various Stakeholders
Courtesy National Fluid Milk Processor Promotion Board; Agency: Lowe Worldwide, Inc.
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Marketing Helps Create Value
1. H.Armstrong Roberts/Retrofile/Getty Images 2. Jamie Grill/Iconica/Getty Images 3. ©Ted Dayton Photography/Beateworks/Corbis 4. Ciaran Griffin/Stockbyte/Getty Images 5. ©Colin Anderson/Blend Images/Corbis
Production
1.
Sales
2.
Marketing3.
Value based marketing
4.
5.
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Value-Based Marketing
“Pure Dark ChocolateLight Exquisite Cookie”“Pure Dark Chocolate
Light Exquisite Cookie”
Courtesy Pepperidge Farm.
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CHECK YOURSELF
1. What is the definition of marketing?
2. Marketing is about satisfying ______ and ______.
3. What are the four components of the marketing mix?
4. Who can perform marketing?
5. What are the various eras of marketing?
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How Do Firms BecomeValue Driven?
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CHECK YOURSELF
1. Does providing a good value mean selling at a low price?
2. What are the benefits of long-term relationships with customers?
3. How are marketers connecting with customers using social and mobile media?
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Why Is Marketing Important?
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Check Yourself
1. List five factors that emphasize the importance of marketing.
2. A firm doing the right thing emphasizes the importance of marketing to _________.