* Chapter

Thirteen

*
Marketing: Helping Buyers Buy

McGraw-Hill/Irwin

Copyright 2010 by the McGraw-Hill Companies, Inc. All rights reserved.

*
CRICKET LEE
Fitlogic
Profile

Developed a system of clothes sizing called Fitlogic. Lees system standardizes sizes and provides flexibility. Though she has an excellent idea, Lee must market her product.
13-2

WHATS MARKETING?

*What is
Marketing? LG1

Marketing -- The activity, set of institutions and

processes for creating, communicating, delivering, and exchanging offerings with value for customers, clients, partners, and society at large.

13-3

FOCUS of CONTEMPORARY MARKETING

*What is
Marketing? LG1

Marketing today involves helping the buyer buy through:

- Websites that help buyers find the best price, identify product features, and question sellers.
- Blogs and social networking sites that cultivate consumer relationships.

13-4

*
FIND A NEED AND FILL IT
Spotlight on Small Business

Lance Fried was an electrical engineer who went into business after he built a waterproof MP3 player. Focused his marketing plan on small surf shops instead of large stores. Now, Fried attends trade shows and runs a website to help sell more products.
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FOUR ERAS of U.S. MARKETING

*The Evolution
of Marketing LG1

Production Era

Selling Era
Marketing Concept Era

Customer Relationship Era

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The PRODUCTION and SELLING ERAS

The general philosophy was Produce what you can because the market is limitless. After mass production, the focus turned from production to persuasion.

*The Evolution
of Marketing LG1

13-7

The MARKETING CONCEPT ERA

After WWII, a consumer spending boom developed.

*The Evolution
of Marketing LG1

Businesses knew they needed to be responsive to consumers if they wanted their business.

13-8

APPLYING the MARKETING CONCEPT

*The Evolution
of Marketing LG1

The Marketing Concept includes three parts:

1. Customer Orientation -- Finding out what customers want and then providing it. 2. Service Orientation -- Making sure everyone in an organization is committed to customer satisfaction. 3. Profit Orientation -- Focusing on the goods and services that will earn the most profit.

13-9

The CUSTOMER RELATIONSHIP ERA

*The Evolution
of Marketing LG1

Customer Relationship Management (CRM) -Learning as much as you can about customers and doing what you can to satisfy or exceed their expectations.

Organizations seek to enhance customer satisfaction building long-term relationships. Today firms like Priceline and Travelocity use CRM that allow customers to build a relationship with the suppliers.
13-10

NONPROFIT MARKETING
Nonprofit marketing tactics include:
- Fundraising

*Nonprofit
Organizations and Marketing LG1

- Public Relations
- Special Campaigns - Ecological practices

- Changing public opinions and attitudes

- Increasing organizational membership
13-11

MARKETING STRATEGIES for NONPROFITS

Nonprofit marketing strategies include:
- Determine the firms goals and objectives.
- Focus on long-term marketing. - Find a competent board of directors. - Exercise strategic planning. - Train and develop long-term volunteers. - Carefully segment the target market.

*Nonprofit
Organizations and Marketing LG1

13-12

*
DEVELOPING a PRODUCT
Product -- A good, service, or
idea that satisfies a consumers want or need.

Designing a Product to Meet Consumer Needs

LG2

Test Marketing -- Testing

product concepts among potential product users.

Brand Name -- A word, letter,

or a group of words or letters that differentiates one sellers goods from a competitors.
13-13

PRICING and PLACING a PRODUCT

*Setting an
Appropriate Price LG2

Pricing products depends on many factors:

- Competitors prices - Production costs - Distribution - High or low price strategies

Middlemen are important in place strategies because getting a product to consumers is critical.
13-14

*
PROMOTING the PRODUCT

Developing an Effective Promotional Strategy

LG2

Promotion -- All the techniques sellers use to

inform people about their products and motivate them to purchase those products.

Promotion includes:
- Advertising - Personal selling

- Public relations
- Viral marketing - Sales promotions
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*
PROGRESS ASSESSMENT

Progress Assessment

*
What does it mean to help the buyer buy?
What are the three parts of the marketing concept? What are the Four Ps of the Marketing Mix?

13-16

SEARCHING for INFORMATION

*Providing
Marketers with Information LG3

Marketing Research -- Analyzing markets to

determine challenges and opportunities, and finding the information needed to make good decisions.

Research is used to identify products consumers have used in the past and what they want in the future.
Research uncovers market trends and attitudes held by company insiders and stakeholders.
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FOUR STEPS in the MARKETING RESEARCH PROCESS

1. Defining the problem or opportunity and determining the present situation.

The Marketing Research Process

LG3

2. Collecting research data.

3. Analyzing the data. 4. Choosing the best solution and implementing it.

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DEFINING the PROBLEM or OPPORTUNITY

Whats the present situation? What are the alternatives? What information is needed? How should the information be gathered?

Defining the Question and Determining the Present Situation

LG3

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COLLECTING SECONDARY RESEARCH DATA

Secondary Data -- Existing data that has
previously been collected by sources like the government.

*
Collecting Data
LG3

Secondary data incurs no expense and is usually easily accessible. Secondary data doesnt always provide all the needed information for marketers.
13-20

COLLECTING PRIMARY RESEARCH DATA

*
Collecting Data
LG3

Primary Data -- In-depth information gathered by

marketers from their own research.

Telephone, online and mail surveys, personal interviews, and focus groups are ways to collect primary data.

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*
FOCUS GROUPS
Collecting Data
LG3

Focus Group -- A group of people who meet under

the direction of a discussion leader to communicate opinions.

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ANALYZING the DATA and IMPLEMENTING the DECISION

*Analyzing the
Research Data LG3

Marketers must turn data into useful information. Must use their analysis to plan strategies and make recommendations. Finally, marketers must evaluate their actions and determine if further research is needed.
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KEY BENEFITS of MARKETING RESEARCH

*Analyzing the
Research Data LG3

Analyze customer needs and satisfaction.

Analyze current markets and opportunities.

Analyze the effectiveness of marketing strategies. Analyze marketing process and tactics currently used. Analyze the reasons for goal achievement or failure.

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WAYS to FIND OUT WHAT CONSUMERS THINK

Conduct informal consumer surveys. Host a customer focus group. Listen to competitors customers. Survey your sales force. Become a phantom customer.

*Analyzing the
Research Data LG3

13-25

SCANNING the MARKETING ENVIRONMENT

*The Marketing
Environment LG4

Environmental Scanning -- The process of

identifying factors that affect marketing success.

Factors involved in the environmental scan include:

- Global factors - Technological factors

- Sociocultural factors
- Competitive factors - Economic factors
13-26

The MARKETING ENVIRONMENT

*The Marketing
Environment LG4

13-27

SOCIAL MARKETING GOES GLOBAL

(Reaching Beyond Our Borders)

* *

Debra Wexler and Brian Gavin founded Whiteflash, an online diamond dealer.

About 10,000 worldwide users visit their site each month.

Wexler started a social marketing campaign and is planning an interactive website to help customers buy.
13-28

The ABCs of MARKETING

Always be customer-focused. Benchmark against the best firms. Continuously improve performance. Develop the best value package. Empower your employees. Focus on relationship building. Goal achievement is the reward.

*The Marketing
Environment LG4

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The CONSUMER and B2B MARKET

Consumer Market -- All the individuals or

Two Different Markets: Consumer and B2B

LG4

households that want goods and services for personal use and have the resources to buy them.

Business-to-Business (B2B) -- Individuals and

organizations that buy goods and services to use in production or to sell, rent, or supply to others.
13-30

*
PROGRESS ASSESSMENT

Progress Assessment

*
What are the four steps in the marketing research process?
Whats environmental scanning? What factors are included in environmental scanning?

13-31

*
MARKETING to CONSUMERS

The Consumer Market LG5

The size and diversity of the consumer market forces marketers to decide which groups they want to serve. Market Segmentation -- Divides the total market
into groups with similar characteristics.

Target Marketing -- Selecting which segments an

organization can serve profitably.

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SEGMENTING the CONSUMER MARKET

*Segmenting
the Consumer Market LG5

Geographic Segmentation -- Dividing the market

by cities, counties, states, or regions.

Demographic Segmentation -- Dividing the

market by age, income, education, and other demographic variables.

Psychographic Segmentation -- Dividing the

market by group values, interests, and opinions. (continued)
13-33

SEGMENTING the CONSUMER MARKET

(continued)

*Segmenting
the Consumer Market LG5

Benefit Segmentation -- Dividing the market

according to product benefits the customer prefers.

Volume (Usage) Segmentation -- Dividing the

market by the volume of product use.

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MARKETING to SMALL SEGMENTS

*Reaching
Smaller Market Segments LG5

Niche Marketing -- Identifies small but profitable

market segments and designs or finds products for them.

One-to-One Marketing-Developing a unique mix of goods and services for each individual consumer.
13-35

MASS MARKETING vs. RELATIONSHIP MARKETING

Mass Marketing -- Developing
products and promotions to please large groups of people.

Moving Toward Relationship Marketing

LG5

Relationship Marketing-Rejects the idea of mass production and focuses toward custom-made goods and services for customers.

13-36

KEYS to SUCCESSFUL RELATIONSHIP MARKETING LG5

Effective relationship marketing is built on:
Open communication Consistently reliable service Staying in contact with customers Trust, honesty, and ethical behavior Showing that you truly care

Moving Toward Relationship Marketing

13-37

STEPS in the CONSUMER DECISION-MAKING PROCESS

1. Problem recognition 2. Search for information 3. Evaluating alternatives

The Consumer Decision-Making Process

LG5

4. Purchase decision
5. Postpurchase evaluation

13-38

The CONSUMER DECSION MAKING PROCESS AND OUTSIDE INFLUENCES

The Consumer Decision-Making Process

LG5

13-39

KEY FACTORS in CONSUMER DECISION-MAKING

Learning Reference Groups Culture Subcultures Cognitive Dissonance

*The Businessto-Business Market LG6

13-40

BUSINESS-to-BUSINESS MARKET (B2B)

B2B marketers include:
- Manufacturers

*The Businessto-Business Market LG6

- Wholesalers and retailers

- Hospitals, schools and charities - Government

Products are often sold and resold several times before reaching final consumers.

13-41

B2B MARKET DIFFERENCES

There are relatively few customers. Customers tend to be large buyers.

*The Businessto-Business Market LG6

Markets are geographically concentrated.

Buyers are more rational than emotional.

Sales are direct. Promotions focus heavily on personal selling.
13-42

*
PROGRESS ASSESSMENT

Progress Assessment

*
Define the terms consumer market and businessto-business market.
Name and describe five ways to segment the consumer market. Whats niche marketing and how does it differ from one-to-one marketing? What are four key factors that make B2B markets different from consumer markets?
13-43