Fundamentals of Marketing CH. 1 + CH. 2

Chapter 1 + Chapter 2 of Marketing

What is Marketing?

• is the process by which companies create value for customers and build strong customer relationships in order to capture value from customers in return

• is NOT just selling and advertising

• New view of ____ focuses on CONSUMER

• managing profitable customer relationships

What is Marketing Myopia?

• a concept where companies focus on selling products rather than understanding customer needs, leading to a narrow view of the market.

• Occurs when sellers pay more attention to the specific products they offer than to the benefits and experiences produced by the products

What is a Market?

A group of buyers and sellers who exchange goods and services, defined by their needs and wants.

What is Satisfaction?

depends on the product’s perceived performance relative to a buyer’s expectations

• If the product’s performance falls short of expectations the customer is dissatisfied 

• If the product’s performance matches expectations, the customer is satisfied 

• If the product’s performance exceeds expectations, the customer is delighted 

• High level of customer _____ or delight often leads to customer loyalty

Selling Concept

is the idea that consumers will not buy enough of the firm’s products unless it undertakes a large scale selling and promotion effort

Marketing Concept

is the idea that achieving organizational goals depends on knowing the needs and wants of the target markets and delivering the desired satisfactions better than competitors do

Societal Concept

is the idea that a company should make good marketing decisions by considering consumers’ wants, the company’s profits, and society’s long-run interests

What is the difference between selling concept and marketing concept?

The selling concept focuses on aggressive sales techniques to increase product sales, while the marketing concept emphasizes understanding and meeting consumer needs to achieve long-term satisfaction and loyalty.

What is Customer Lifetime Value?

• is the total worth of a customer to a business over the entirety of their relationship, factoring in revenue and costs associated with acquiring and serving that customer.

• companies are realizing that losing a customer means losing more than a single sale. it means losing the entire stream of purchase that the customer would make over a lifetime of patronage

Customer Equity

the total combined customer lifetime values of all the company’s current and potential customers that reflects the value of maintaining relationships with customers over time.

Consumer Generated Marketing

is a marketing strategy that involves customers creating content or feedback about a brand or product, which can influence other consumers and enhance brand loyalty.

Explain Marketing Process

1. understand the marketplace and customer needs and wants

2. design a customer-driven marketing strategy

3. contract a marketing program that delivers superior value

4. build profitable relationships and create profits and customer equity

Production Concept

holds that consumers will favor products that are available and highly affordable

Product Concept

holds that consumers will favor products that offer the most in quality, performance, and innovative features.

Market Segmentation

is the process of dividing a market into distinct groups of buyers who have different needs, characteristics, or behavior who might require separate products or marketing programs

Market Segment

consists of consumers who respond in a similar way to a given set of marketing efforts

Market Targeting

• is evaluating each market segment’s attractiveness and selecting one or more segments to enter 

• A company with limited resources might serve only a few “market niches” Market niches are segments that major competitors overlook or ignore 

• Most companies enter a new market by serving a single segment. If this proves successful, they add segments

Differentiation

differentiating the company’s market offering so that it gives consumers more value

Market Positioning

• Product ____ is the place the product occupies relative to competitors in consumers’ minds 

• is arranging for a product to occupy a clear, distinctive, and desirable place relative to competing products in the minds of target consumers

Developing and Integrated Marketing Mix

• The set of controllable, tactical marketing tools that the firm blends to produce the response it wants in the target market 

• Consists of the “four Ps”; product, price, place, and promotion

An Alternative of 4 Ps — 4 Cs

• From the buyer’s viewpoint, the four Ps might do better described as the four Cs:

Products = Customer Solution

Price = Customer Cost

Place = Convenience 

Promotion = Communication