MarketingMarketing“Marketing is Everything”

- Regis McKenna, HBR, 1991

“The End of Marketing”- Regis McKenna, Business 2.0, 2000

AnAn Introduction to Introduction to MarketingMarketing

Marketing defined:“Marketing is an organizational function and a set of processes for creating, communicating, and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders.- American Marketing Association

(And hereafter regarding definitions)

Organizational FunctionsOrganizational Functions– What do firms really do?– What do firms really do?

Theories: Theories:• Economic - Financial • Agency - Managerial • Resource Allocation -Managerial• Competitive Rationality - Marketing• Adaptive Organization – Managerial• Transaction Function - Economic• Knowledge-Based – Cross-Functional

– Information Processing– Learning/Teaching

• Where is MARKETING in all this?

Organizational FunctionsOrganizational Functions– What do firms really do?– What do firms really do?

Theories: Theories:• Economic - Financial • Agency - Managerial • Resource Allocation -Managerial• Competitive Rationality - Marketing• Adaptive Organization – Managerial• Transaction Function - Economic• Knowledge-Based –Knowledge-Based – Cross-FunctionalCross-Functional

Intelligence Cycle Learning/Teaching

MARKETINGMARKETING

Knowledge-Based Theory of the Firm

AnAn Introduction to Introduction to MarketingMarketing

Marketing defined:“Marketing is an organizational function and a set of processes for creating, communicating, and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders.

VISION

The Fundamental ‘Model’The Fundamental ‘Model’

STRATEGY OPERATIONS TACTICS

VALUE

Loyalty/Love Belief/Behavior Custom/Habituation

Build FOCUS and “Mind Share”

Build TRUST and “Access Share”

Build CAPABILITY and “Market Share”

Build FRANCHISE and “Heart Share”

ProcessServiceBrandingBranding Value Indicator

IT/IMResearch/DDDistribution/LogisticsDistribution/Logistics

Segmentation Macro/Micro MethodologyTargeting Size Dynamic LeveragePositioningPositioning Reason for Being Offering

Four P’s (Concept/Creativity) Product/Promo/Price Place/ plus 1 + PeopleSelling (Capture) B2B (Buyer-Seller/Promo) B2C (Advertising) C2C (Buzz/Virus/Referral)Differentiation Differentiation Content (What) Context (How) Infrastructure (Enables)

Value creation and destructionValue culture

AnAn Introduction to Introduction to MarketingMarketing

Marketing defined:“Marketing is an organizational function and a set of processes for creating, communicating, and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders.

The Communication Process

SENDER RECEIVERMEDIUM

•Sponsor (sender) encodes message properly (or NOT)•Sponsor sends message through the channel (medium) to the consumer (receiver).•Consumer receives the message and decodes it into meaningful information (or NOT)

Attitude: Self-Referencing Issues Attitude: Cultural Filter Issues

Firm Intermediary; CustomerCustomer

Noise

AnAn Introduction to Introduction to MarketingMarketing

Marketing defined:“Marketing is an organizational function and a set of processes for creating, communicating, and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders.

Value can be expressed several ways. Three of the clearest are:

Benefits (total ‘get)Value = ---------- … or more specifically,

Price (total ‘give’)

Fb + EbValue = --------- … where,

P + Oe

Fb = Functional benefits (utility) Eb = Emotional benefits (psychology)

P = Price (charged) for acquisitionOe = Other expenses/costs of acquisition … and finally

Value = You answered my question!Solved my problem!

Classic Marketing Development Sequence Time/Space

1930’s

Today

AnAn Introduction to Introduction to MarketingMarketing

Marketing defined:“Marketing is an organizational function and a set of processes for creating, communicating, and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders.

customer relationship managementA discipline in marketing combining database and computer technology with customer service and marketing communications.

Customer relationship management (or CRM) seeks to create more meaningful one-on-one customer communications by applying customer data (demographic, industry, buying history, etc.) to every communications vehicle.

At the simplest level, this would include personalizing e-mail or other communications with customer names. At a more complex level, CRM enables a company to produce a consistent, personalized marketing communication whether the customer sees an ad, visits a Web site, or calls customer service.

C R MC R M

American Marketing Association

AnAn Introduction to Introduction to MarketingMarketing

Marketing defined:“Marketing is an organizational function and a set of processes for creating, communicating, and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholdersstakeholders.

StakeholdersOne of a group of publics with which a company must be concerned. Key stakeholders include consumers, employees, stockholders, suppliers, and others who have some relationship with the organization.

Overall Discussion and Overall Discussion and QuestionsQuestions• Syllabus and assignments• Textbook• Objectives• What marketing is• Who is involved in the

course• ____________________• ____________________• ____________________