*

* Chapter

Thirteen

Marketing:

Helping

Buyers Buy

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

*

* Profile

• Developed a system of

clothes sizing called Fitlogic.

• Lee’s system standardizes

sizes and provides flexibility.

• Though she has an excellent

idea, Lee must market her

product.

CRICKET LEE Fitlogic

13-2

*

* What is

Marketing?

• 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.

WHAT’S MARKETING?

LG1

13-3

*

* What is

Marketing?

• Marketing today involves helping the buyer buy

through:

- Websites that help buyers find the best price,

identify product features, and question sellers.

FOCUS of CONTEMPORARY

MARKETING LG1

- Blogs and social

networking sites that

cultivate consumer

relationships.

13-4

*

*

• Lance Fried was an electrical engineer who went

into business after he built a waterproof MP3

player.

FIND A NEED AND FILL IT Spotlight on Small Business

• 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.

13-5

*

* The Evolution

of Marketing

• Production Era

• Selling Era

• Marketing Concept Era

• Customer Relationship

Era

FOUR ERAS of U.S. MARKETING

LG1

13-6

*

* The Evolution

of Marketing

• The general philosophy was

“Produce what you can

because the market is

limitless.”

• After mass production, the

focus turned from production

to persuasion.

The PRODUCTION and

SELLING ERAS LG1

13-7

*

* The Evolution

of Marketing

• After WWII, a consumer spending boom

developed.

• Businesses knew they needed to be responsive

to consumers if they wanted their business.

The MARKETING CONCEPT ERA

LG1

13-8

*

* The Evolution

of Marketing

• 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.

APPLYING the

MARKETING CONCEPT LG1

13-9

*

* The Evolution

of Marketing

• 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.

The CUSTOMER

RELATIONSHIP ERA LG1

13-10

*

*

• Nonprofit marketing tactics include:

NONPROFIT MARKETING Nonprofit

Organizations

and Marketing

LG1

- Fundraising

- Public Relations

- Special Campaigns

- Ecological practices

- Changing public opinions and

attitudes

- Increasing organizational

membership

13-11

*

*

• Nonprofit marketing strategies include:

- Determine the firm’s 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.

MARKETING STRATEGIES for

NONPROFITS

Nonprofit

Organizations

and Marketing

LG1

13-12

*

* Designing a

Product to Meet

Consumer

Needs

• Product -- A good, service, or

idea that satisfies a consumer’s

want or need.

• Test Marketing -- Testing

product concepts among

potential product users.

• Brand Name -- A word, letter,

or a group of words or letters

that differentiates one seller’s

goods from a competitor’s.

DEVELOPING a PRODUCT

LG2

13-13

*

* Setting an

Appropriate

Price

• 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.

PRICING and

PLACING a PRODUCT LG2

13-14

*

* Developing an

Effective

Promotional

Strategy

• 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

PROMOTING the PRODUCT

LG2

13-15

*

* Progress

Assessment

• What does it mean to “help the buyer buy?”

• What are the three parts of the marketing

concept?

• What are the Four P’s of the Marketing Mix?

PROGRESS ASSESSMENT

13-16

*

* Providing

Marketers with

Information

• 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.

SEARCHING for INFORMATION

LG3

13-17

*

* The Marketing

Research

Process

1. Defining the problem or opportunity and

determining the present situation.

2. Collecting research data.

3. Analyzing the data.

4. Choosing the best solution and implementing it.

FOUR STEPS in the MARKETING

RESEARCH PROCESS LG3

13-18

*

* Defining the

Question and

Determining the

Present Situation

• What’s the present situation?

• What are the alternatives?

• What information is needed?

• How should the information be

gathered?

DEFINING the PROBLEM or

OPPORTUNITY LG3

13-19

*

* Collecting

Data

• Secondary Data -- Existing data that has

previously been collected by sources like the

government.

COLLECTING SECONDARY

RESEARCH DATA LG3

• Secondary data incurs no

expense and is usually

easily accessible.

• Secondary data doesn’t

always provide all the

needed information for

marketers. 13-20

*

* Collecting

Data

• 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.

COLLECTING PRIMARY

RESEARCH DATA LG3

13-21

*

* Collecting

Data

• Focus Group -- A group of people who meet under

the direction of a discussion leader to communicate

opinions.

FOCUS GROUPS

LG3

13-22

*

* Analyzing the

Research Data

• Marketers must turn data into useful information.

• Must use their analysis to plan strategies and

make recommendations.

ANALYZING the DATA and

IMPLEMENTING the DECISION LG3

• Finally, marketers

must evaluate their

actions and

determine if further

research is needed.

13-23

*

*

• 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.

KEY BENEFITS of MARKETING

RESEARCH LG3

Analyzing the

Research Data

13-24

*

*

• Conduct informal consumer surveys.

WAYS to FIND OUT WHAT

CONSUMERS THINK LG3

Analyzing the

Research Data

• Host a customer focus

group.

• Listen to competitor’s

customers.

• Survey your sales force.

• Become a “phantom”

customer.

13-25

*

* The Marketing

Environment

• 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

SCANNING the MARKETING

ENVIRONMENT LG4

13-26

*

* The Marketing

Environment The MARKETING ENVIRONMENT

LG4

13-27

*

*

• 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.

SOCIAL MARKETING

GOES GLOBAL (Reaching Beyond Our Borders)

13-28

*

*

• 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 ABC’s of MARKETING

LG4

The Marketing

Environment

13-29

*

* Two Different

Markets:

Consumer and

B2B

• Consumer Market -- All the individuals or

households that want goods and services for

personal use and have the resources to buy them.

The CONSUMER and

B2B MARKET LG4

• 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

• What are the four steps in the marketing research

process?

• What’s environmental scanning?

• What factors are included in environmental

scanning?

PROGRESS ASSESSMENT

13-31

*

* The Consumer

Market

• 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.

MARKETING to CONSUMERS

LG5

13-32

*

* Segmenting

the Consumer

Market

• 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)

SEGMENTING the CONSUMER

MARKET LG5

13-33

*

* Segmenting

the Consumer

Market

• Benefit Segmentation -- Dividing the market

according to product benefits the customer prefers.

• Volume (Usage) Segmentation -- Dividing the

market by the volume of product use.

SEGMENTING the CONSUMER

MARKET (continued)

LG5

13-34

*

* Reaching

Smaller Market

Segments

• Niche Marketing -- Identifies small but profitable

market segments and designs or finds products for

them.

MARKETING to

SMALL SEGMENTS LG5

• One-to-One

Marketing-- Developing a unique

mix of goods and

services for each

individual consumer.

13-35

*

* Moving Toward

Relationship

Marketing

• Mass Marketing -- Developing

products and promotions to

please large groups of people.

• Relationship Marketing-- Rejects the idea of mass

production and focuses toward

custom-made goods and services

for customers.

MASS MARKETING vs.

RELATIONSHIP MARKETING LG5

13-36

*

*

• 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

KEYS to SUCCESSFUL RELATIONSHIP

MARKETING LG5

Moving Toward

Relationship

Marketing

13-37

*

* The Consumer

Decision-Making

Process

1. Problem recognition

2. Search for information

3. Evaluating alternatives

4. Purchase decision

5. Postpurchase evaluation

STEPS in the CONSUMER

DECISION-MAKING PROCESS LG5

13-38

*

* The CONSUMER DECSION MAKING

PROCESS AND OUTSIDE INFLUENCES LG5

The Consumer

Decision-Making

Process

13-39

*

* The Business-

to-Business

Market

• Learning

• Reference Groups

• Culture

• Subcultures

• Cognitive Dissonance

KEY FACTORS in CONSUMER

DECISION-MAKING LG6

13-40

*

* The Business-

to-Business

Market

• B2B marketers include:

- Manufacturers

- Wholesalers and retailers

- Hospitals, schools and charities

- Government

• Products are often sold and resold several times

before reaching final consumers.

BUSINESS-to-BUSINESS

MARKET (B2B) LG6

13-41

*

* The Business-

to-Business

Market

• There are relatively few customers.

• Customers tend to be large buyers.

• Markets are geographically concentrated.

• Buyers are more rational than emotional.

B2B MARKET DIFFERENCES

LG6

• Sales are direct.

• Promotions focus

heavily on personal

selling.

13-42

*

* Progress

Assessment

• Define the terms consumer market and business-

to-business market.

• Name and describe five ways to segment the

consumer market.

• What’s 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?

PROGRESS ASSESSMENT

13-43