7203 .r 'c? El 1 of 3 CHAPTER 11 BUILDING CUSTOMER RELATIONSHIPS THROUGH EFFECTIVE MARKETING Marketing- it is how we create, communicate, deliver and exchange offerings (products, services, etc.) to customers, clients, partners and society at large. Utility the ability ot'a good or service to satisfy a human need. Types: 1. Form utility- created by convening production inputs into nished products. (inuenced by marketing)- data from market research may determine size, shape or features of a product. 2. Time utility - making products available when customers want them. ie- Halloween costumes manufactured in spring and put in stores in Octoberor winter coats manufactured in spring and sold in the Fall. Also pop up Halloween stores. 3. Possession utility - created by transferring ownership (title) of a product to a buyer - daily items purchased- sales receipt cars and homes (actual title transferred) When you return an item you reverse possession utility. 4. Place utility- making a product available at a location where customers which to purchase it (ie- from manuf plant to store- or in a store product placement can be relevant) Marketing concept- a business philosophy that a rm should provide goods and services that satisfy customers' needs through a coordinated set of activities that allow the rm to achieve its objectives. ( management must fully adopt and implement it to make it work). Markets - are a group of individuals or organizations or both that need products in a given category and that have the ability, willingness and authority to purchase such products. Classications: broad-consumer or business to business Marking ettorts vary based upon the target market. Consumer Markets - consist ofpurehasers and/ or household who purchase to consume or benet from product but does not intend to make prot. Examples: You purchase toilet paper or groceries. Business to Business Markets (industrial markets) grouped into producer, reseller, governmental and institutional. Examplr I purchase ofce supplies for my home office. Marketing strategy - a plan that will enable an organization to make the best use of its resources and advantages to meet its objectives. Marketing Mix - a combination of product, price, distribution, and promotion developed to satisfy a particular target market. Thus the elements of a marking mix are: product, price, distribution and promotion. Note: When you take Marketing the mix will be product, price, place and promotion, otherwise know as the 4 P's, For some reason your book utilizes the term distribution instead of place. Therefore, we study it as Product, Price, Distribution and Promotion in this course. Target Market- group ofindividuals or organizations, or both. for which a rm develops and maintains a marketing mix (meaning product price, distribution and promotioanuitable for the specic needs and preferences ot'that group, Undifferentiated Approach- COMPANY DESIGNS A SINGLE MARKETING MIX (SEE DEFINITION BELO'V) AND DIRECTS THE MARKETING MIX AT THE ENTIRE MARKET FOR PARTICULAR PRODUCT. Only utilized in limited situations- assumes similar needs ot'customers- When customers needs vary should use market segmentation approach below. Single Marketing Mix consists oft type ofproduct, [ price, mpromotional program and distributions system. Generally applies to staple products such as salt and sugar, Ie Morton Salt- Market Segmentation (approach) - the process ofdividing a market into segments and directing a marketing mix at a particular segment or segments rather than at the total market. TWO types : differentiated (multiple marketing mix directed at multiple market segments) and concentrated (one marketing mix directed at a single market segement) Market segment- a group of individuals or organizations within a market that share one or more common characteristics. 6 ;-east1prodf|eet02xythos.content.blackboardcdn.com 7:03 2 promotion, otherwise know as the 4 P's. For some reason your book utilizes the term distribution instead of place. Therefore, we study it as Product, Price, Distribution and Promotion in this course. Target Market- group of individuals or organizations, or both, for which a firm develops and maintains a marketing mix (meaning product, price, distribution and promotion) suitable for the specific needs and preferences of that group. Undifferentiated Approach- COMPANY DESIGNS A SINGLE MARKETING MIX (SEE DEFINITION BELOW) AND DIRECTS THE MARKETING MIX AT THE ENTIRE MARKET FOR PARTICULAR PRODUCT. Only utilized in limited situations- assumes similar needs of customers- When customers needs vary should use market segmentation approach below. Single Marketing Mix consists of one type of product, one price, one promotional program and one distributions system. Generally applies to staple products such as salt and sugar. Ie- Morton Salt- Market Segmentation (approach) - the process of dividing a market into segments and directing a marketing mix at a particular segment or segments rather than at the total market. TWO types : differentiated (multiple marketing mix directed at multiple market segments) and concentrated (one marketing mix directed at a single market segement) Market segment- a group of individuals or organizations within a market that share one or more common characteristics. Common bases of market segmentation Demographic (age, race, income, occupation, etc) Psycho graphic (Motives, lifestyle, personality) Geographic (location, rural, city(urban), suburban, state, country) Behavioristic (volume, end use, benefit expectations, brand loyalty, price) Creating a Marketing Mix- (factors controlled internally) Product - design, brand names, packaging, warranties etc. Price - base prices and discounts (maximize profit-make room for new models, clear inventory) Distribution - transportation and storage - consider use of intermediaries Promotion - advertising, personal selling, sales promotions, public relations OTHER FACTORS ALSO EFFECT MARKETING AND ARE UNCONTROLLABLE-They are: Economic forces- what is going on in the economy Sociocultural - influences in society and cultures Political- influences that arise based on politics and politicians activities Legal and regulatory -laws to protect consumers and government regulations. Technological - changes that can cause new opportunities or cause products to become obsolete overnight! Marketing Plan-written document that specifies an organizations resources, objectives and marketing strategy. In determining your marketing plan you will want to consider different types of buying behavior. NOTE: This chapter has been condensed because this class touches on everything but does not go into depth. When you take Marketing, you will further explore all of the various aspects related thereto. As-east-1-prod-fleet02-xythos.content.blackboardcdn.com