Principles of Marketing - Chapter 1 & 2

The process of creating, distributing, promoting, and pricing goods, services, and ideas to facilitate satisfying exchange relationships with customers and to develop and maintain favorable relationships with stake holders in a dynamic environment

Marketing

A specific group of customers on whom an organization focuses its marketing efforts

Target Market

Four marketing activities that a firm can control to meet the needs of customers within its target market

Marketing Mix

What are the four marketing activities of a marketing mix?

Product, pricing, distribution, and promotion

What can a product be?

A good, service, or idea

Marketing managers need to make products available in quantities desired to as many target market customers as possible

Distribution Variable

What three costs do distribution variables minimize?

Inventory, transportation, storage

Relates to activities used to inform individuals or groups about the organization and its products

Promotion Variable

A critical component of the marketing mix as customers are concerned about value obtained in an exchange

Price

Relates to a decision and actions associated with establishing pricing objectives and policies and determining product prices

Pricing Variable

What can Promotion Variables do?

Increase public awareness, educate customers, and sustain interest in a product

A customer's subjective assessment of benefits relative to costs in determining the worth of a product

Value

Anything a buyer receives in an exchange

Customer benefit

Anything a buyer must give up to obtain the benefits the product provides including cost, time, effort and risk

Customer costs

What can the marketing mix enhance?

Perceptions of value

Provisions or transfer of goods, services, or ideas in return for something of value

Exchange

Rules of an exchange:

Need two or more parties, provide a benefit or satisfaction for both parties, party must have confidence in the promise of the "something of value," build trust

Constitutes who have a "stake" or claim in some aspect of a company's products, operations, markets, industry, and outcomes

Stakeholders

What does a marketing environment include?

Competitive, economic, political, legal and regulatory, technological, and socio-cultural

What is the lifeline of the business?

Customer relationships

Using information about customers to create marketing strategies that develop and sustain desirable customer relationships

Customer relationship management

What does Customer Lifetime Value emphasis?

Changes from share of market to share of customer

The process of planning, implementing, and evaluating the performance of marketing activities and strategies , both effectively and efficiently

Strategic Marketing Management

The process of establishing an organizational mission and formulating goals, corporate strategy, marketing objectives, and marketing strategy

Strategic Planning

A long-term view, or vision, of what the organization wants to become

Mission Statement

What two questions does a Mission Statement involve?

Who are our customers? What is our core competency?

Determines the means for utilizing resources in the functional areas of marketing, production, finance, research and development, and human resources to reach the organizations goal

Corporate Strategy

What issues are corporate strategy planners concerned with?

Corporate culture, competition, differentiation, diversification, interrelationships among business units, environmental and social issues

What should be consistent with corporate strategies?

Business-Unit strategies

A division, product line, or other profit center within the parent company

Strategic Business Unit

A group of individuals and/or organizations that have needs for products in a product class and have the ability, willingness, and authority to purchase those products

Market

The percentage of a market that actually buys a specific product from a particular company is referred to

Market Share

Things a company does extremely well, which sometimes gives it an advantage over the competition

Core competencies

A combination of circumstances and timing that permits an organization to take action to reach a particular target market

Market opportunity

Temporary periods of optimal fit between key requirements of a market and the particular capabilities of a company competing in a market

Strategic windows

The place where opportunities, strategic windows, and core competencies meet

Competitive Advantage

What does an organizations long health depends upon?

Having some products that generate cash and others that use cash to support growth

What is most likely the most important planning decision of companies?

Choosing a target market