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Chapter 1
The nature and scope of Marketing
By
Dr. Raafat Youssef Shehata
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Marketing
Marketing is defined to be the process responsible for anticipation, identification ,
and satisfaction of customer needs through a profit
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Marketing manager
• He is the bridge between the company and the customers
• His functions are (APIC)
Analysis
Planning
Implementation
Control
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What are Consumers’ Needs, Wants, and Demands?
Needs Needs - state of felt deprivation including physical, social, and individual needs i.e hunger
WantsWants - form that a human need takes as shaped by culture and individual personality i.e. bread
DemandsDemands - human wants backed by buying power i.e. money
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American Association of Advertising Agencies
• This ad demonstrates that advertising can’t make consumers buy things that they don’t need despite high-pressure selling.
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Marketing and Sales Concepts Contrasted
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Push versus pull strategies
• A push strategy involves the manufacturer using its sales
force and trade promotion money to induce intermediaries to
carry, promote, and sell the product to end user.
• A pull strategy involves the manufacturer using advertising
and promotion to induce consumers to ask intermediaries for
the product, thus inducing the intermediaries to order it
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Production ConceptProduction Concept
Product ConceptProduct Concept
Selling ConceptSelling Concept
Marketing ConceptMarketing Concept
Societal Marketing ConceptSocietal Marketing Concept
Marketing Management Philosophies
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Production concept
The production concept holds that consumers will prefer
products that are widely available and inexpensive.
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Product concept
-The product concept holds that consumers will favor those products that
offer the most quality, performance, or innovative features
-In order to compete effectively, the product needs to have features that
appeal to individual consumers. In a product-oriented firm, the products
are designed to incorporate a large number of features in order to meet
the needs of a large number of consumers. Unfortunately, the cost
becomes too high for most people, and of course people do not want to
pay for features that they are unlikely ever to use.
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Selling concept
The selling concept holds that consumers and
businesses, will ordinarily not buy enough of the
organization’s products, therefore, the organization
must undertake aggressive selling and promotion
effort.
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Marketing conceptThe marketing concept holds that the key to achieving organizational
goals consists of the company being more effective than competitors in
creating, delivering, and communicating superior customer value to its
chosen target markets.
Reactive marketing orientation: understanding and meeting consumers’ expressed needs.
Proactive marketing orientation: researching or imagining latent consumers’ needs
through a “probe-and-learn” process
e.g. Wal Mart
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Company Orientations towards business
.
Marketing Concept
ReactiveReactive market
Understanding and
meeting consumers’
expressed needs
ProactiveProactive marketing
Finding latent consumers’
needs through a “probe-
and-learn” process.
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Marketing Concept Evolution
Production Concept Consumers prefer products that are widely available and inexpensive
Product Concept Consumers favor products that offer the most quality, performance, and innovative
features
Selling Concept Consumers will buy products only if the company aggressively promotes/sells these
products
Marketing Concept Focuses on needs/wants of target markets & delivering value better than competitors
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Marketing orientation and increasing customer value
British airways and American airlines may use the same kind of aircraft to fly executives first class between New York and London but British airways (BA) beats American airlines by meeting customers’ needs for convenience and rest at every step of the journey
BA value delivery system includes a separate first class express check in and security clearance plus a pre-flight express meal service in the first class lounge so that time pressed executives can maximize sleep time on the plane without the distraction of in flight meals . BA was the first to put seats that recline into perfectly flat beds into first class section
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Selling focuses on the needs of the seller ,
Marketing on the needs of the buyers
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Marketing orientation
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Marketing orientation
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Internal marketing
-It is the creation of customer focus concept within the organization
-Marketing mix of internal marketing
-Training and education
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The 4 P’s & 4 C’s of the Marketing Mix
• 4 P’s– Product– Price– Place– Promotion
• 4 C’s– Customer Solution– Customer Cost– Convenience– Communication
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Social Responsibility and Marketing Ethics
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Ethics
• It is the science which determines what is right and what is wrong
• Products may be:1. Ethical and legal
2. Ethical and illegal
3. Unethical and legal
4. Unethical and illegal
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Ethics and marketing mix
1. Product
2. Price
3. Place
4. Promotion
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Sex sells ,but did Calvin Klein cross the line? 1995
-The print ads show some models revealing their underwear
-These ads are shot by the same Steven Meisel who photographed Madonna’s controversial book sex)
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Social responsibility
• It is the obligation of any organization to increase its positive effects and decrease its negative effects on the society
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The Avon walk for breast cancer
Avon is the largest corporate supporter of the breast cancer cause with more than $ 250 million generated since the
first program in 1992
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Relationship Marketing
• Relationship marketing has the aim of building mutually
satisfying long-term relationships with key parties—
customers, suppliers, distributors, and other marketing
partners.
• The ultimate outcome of relationship marketing is the building
of a unique company asset called a marketing network.
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5 levels of customer relationship
1.Basic relation .
2.Reactive relation.
3.Accountable relation .
4.Proactive relation .
5.Partnership relation.
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Many customers/
distributors
Accountable Reactive Basic or reactive
Medium No. customers/
distributors
Proactive Accountable Reactive
Few customers/
distributors
Partnership Proactive Accountable
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Morgan and Hunt model
commitment
Trust
Co-operation
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