Chapter 13: Marketing in Today's World

Marketing Essentials

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 market is a group of customers who share common wants and needs.
Marketing 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.

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 relationship marketing to build and maintain relationships with their customers.

The marketing 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.
- A channel 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.
- Indirect 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 break-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 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 marketing concept involves determining the wants and needs of customers and providing them more efficiently and effectively than competitors.
Demographics are facts about the population
Target marketing helps companies focus on the people most likely to buy their goods or services.
Market segmentation is the division of a market for a product into groups of customers who have the same needs and traits.

Generate ideas
Screen ideas
Develop a business plan
Develop the product
- A prototype is a model of the actual product
Test-market the product
- To test-market a product means to offer it in a limited market for a limited time
Introduce the product
Evaluate customer acceptance