Chapter 13: Marketing in Today's World

knowt logo

Chapter 13: Marketing in Today's World

\

Marketing Essentials

\

The Basics of Marketing

  • To market a product successfully, a company has to understand what people want to buy and why they want to buy it.
  • It all comes down to knowing your market.
  • From a marketing viewpoint, a marketmarket is a group of customers who share common wants and needs.
  • MarketingMarketing is the process of creating, promoting, and presenting a product or service to meet the wants and needs of consumers, wherever they are.
    • Marketing involves a number of stages, from studying what people want to buy to designing a product’s packaging.

\

The Functions of Marketing

  • There are seven functions of marketing.
    • Distribution is the process of getting goods and services to customers.
    • Financing is getting the money that is necessary for setting up and running a business.
    • Marketing information management is gathering and analyzing information about consumers, trends, and competitors’ products.
    • Pricing is deciding how much to charge for a product or service so the business can make a profit.
    • Product/service management is obtaining, developing, maintaining, and improving a product or product mix in response to market opportunities.
    • Promotion is any effort to inform, persuade, or remind potential customers about a business’s products or services.
    • Selling is providing customers with the goods and services they choose to buy.
  • A popular trend today is using relationship marketing.
  • Companies use relationshipmarketingrelationship marketing to build and maintain relationships with their customers.

\

The Marketing Mix

  • The marketingmixmarketing mix consists of four basic marketing strategies: product, place, price, and promotion, collectively known as the four Ps.
  • In recent years, many people have begun to include a fifth P for people because the success of a marketing mix depends on people: good employees and customers.
  • First, marketing is used to find out if there is a demand for a product.
    • Marketers have to decide how and where customers will buy their goods and services
  • To make place decisions, marketers select the right channel of distribution.
    • channelofdistributionchannel of distribution is a pathway to direct products to consumers.
    • Direct distribution occurs when goods or services are sold from the producer directly to the customer.
    • IndirectdistributionIndirect distribution involves one or more intermediaries.
  • To determine the price of a product, a marketer considers three questions:
    • (1) How much are customers willing to pay?
    • (2) Is the price competitive with other products? and
    • (3) Can the company make a profit?
  • Marketers must find the break-even point.
    • The breakevenpointbreak-even point is the point at which total revenues, or sales, equal total costs and expenses of developing and offering a product or service.
  • Promotion involves making customers aware of a product.
  • The most familiar form of promotion is advertising

\

Market Research and Product Development

\

Market Research

  • MarketresearchMarket research is the gathering and analysis of information on the size, location, and makeup of a market.
    • Market research helps companies to produce and market products and services that attract customers.
  • This is known as the marketing concept.
    • The marketingconceptmarketing concept involves determining the wants and needs of customers and providing them more efficiently and effectively than competitors.
  • DemographicsDemographics are facts about the population
  • TargetmarketingTarget marketing helps companies focus on the people most likely to buy their goods or services.
  • MarketsegmentationMarket segmentation is the division of a market for a product into groups of customers who have the same needs and traits.

\
\

  1. Generate ideas
  2. Screen ideas
  3. Develop a business plan
  4. Develop the product
    • A prototype is a model of the actual product
  5. Test-market the product
    • To testmarkettest-market a product means to offer it in a limited market for a limited time
  6. Introduce the product
  7. Evaluate customer acceptance

\