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Module 1:

What is Marketing?
BA 170
Dr. Dave Centeno
ABOUT THE INSTRUCTOR
Education

VSB

Consulting (Research, Training, Marketing, Communications)

Memberships on Academic Societies


Common Misconceptions
Marketing is about
making money.

Marketing is just
advertising

Marketing is about
making people
believe one thing is
better
Common Misconceptions
Marketing is about Marketing ensures
making money. exchanges occur.

Marketing is just Marketing is


advertising proposing value.

Marketing is about Marketing is about


making people making sure people
believe one thing is who need something
better get it.
Jollibee –
and the native instincts

driven by native instinct,

personal experience in life, and plain common sense


Amazon:
Customers as Guests

“We see our customers as invited


guests to a party, and we are the
hosts. It’s our job every day to
make every important aspect of
the customer experience a little
better.” – Jeff Bezos
Starbucks –
A Third Place

Source: http://orangemagazine.ph/wp-content/uploads/2016/12/image001-1-1.jpg

"third place," an "affordable luxury" where middle-age baby


boomers could share and enjoy a cup of coffee with friends and
colleagues, away from work and home
Discussion:

1. In your own words, what is


marketing?
2. How do you see marketing
working for you?
1935: “the performance of business activities that direct the flow of
goods and services from producers to consumers”

1985: “the process of planning and executing the conception, pricing,


promotion, and distribution of ideas, goods and services to create
exchanges that satisfy individual and organisational objectives”

2004: “an organizational function and set of processes for creating,


communicating and delivering value to customers and for managing
customer relationships in ways that benefit the organisation and
stakeholders”

2007: Marketing is the activity, set of institutions, and processes for


creating, communicating, delivering, and exchanging offerings that
have value for customers, clients, partners, and society at large’
Kotler-Armstrong Definition

Marketing is a process by



which organizations create value for customers
and build strong relationships to capture

value from customers in return.
Keywords
What do we “market”?
• Products – tangible
material goods

• Services – intangible
human expertise

• Ideas/Experiences –
any value-oriented
concept in between

• What else?
“Market”
The universe of
consumers and sets
of products,
services and/or
ideas that are in
constant exchange
with each other.
“Value”
• Value – Perceived net worth of a product, service
and/or idea that justifies the price required to avail
of it.
“Value”
• Value – Perceived net worth of a product, service
and/or idea that justifies the price required to avail
of it.

Why do people buy smart phones?


Value + Marketing Mix
The Marketing Process
The Marketing Process

Understanding
the market and
the consumers

✔ Brand situational analysis

– environment Needs vs Wants vs Desires?


– competitor vs Demand?
– consumer
The Marketing Process

Understanding
the market and
the consumers

✔ Brand situational analysis

– environment When backed by buying power, wants


– competitor become demands.
– consumer
The Marketing Process

Understanding Designing a
the market and consumer-driven
the consumers marketing strategy

dividing the market into segments of


✔ Brand positioning strategy customers

We cannot serve all customers in every


– market segmentation
way. By trying to serve all customers, we
– target market identification
may now serve any customers well, and
– value proposition
profitably,

how different the brand is from others.


The Marketing Process

Understanding Designing a
the market and consumer-driven
the consumers marketing strategy

✔ Brand positioning strategy

– market segmentation
– target market identification
– value proposition
– marketing management orientations
Marketing Management Orientations
– philosophies guiding marketing strategies –

Production Concept – consumers will favour


products that are available and highly
affordable; therefore, the organisation should
focus on improving production and distribution
efficiency

Product Concept – consumers will favour


products that offer the most quality,
performances, and features; therefore, the
organization should devote its energy to
making continuous product improvements
Marketing Management Orientations
– philosophies guiding marketing strategies –

Selling Concept – consumers will not buy


enough of the firm’s products unless the firm
undertakes a large-scale selling and
promotion effort.

Marketing Concept – a philosophy in which


achieving organisational goals depends on
knowing the needs and wants of target
markets and delivering the desired
satisfaction better than competitors do.
Marketing Management Orientations
– philosophies guiding marketing strategies –
Marketing Management Orientations
– philosophies guiding marketing strategies –

Societal Concept – company’s marketing


decisions should consider consumers’ wants,
the company’s requirements, consumers’
long-run interests, and society’s long-run
interests.
The Marketing Process

Understanding Designing a Constructing an


the market and consumer-driven integrated
the consumers marketing strategy marketing program

✔ Marketing Mix Development

– product
– price
– place
– promotion (communication)
The Marketing Process

Understanding Designing a Constructing an Building


the market and consumer-driven integrated consumer
the consumers marketing strategy marketing program relationships

✔ Customer Relationship Management CRM – overall process of building


and maintaining profitable customer
– customer-perceived value relationships by delivering superior
– ensuring satisfaction (formula?) customer value and satisfaction. –
– ensuring retention and loyalty acquiring, keeping, and growing
customers.
The Marketing Process

Understanding Designing a Constructing an Building


the market and consumer-driven integrated consumer
the consumers marketing strategy marketing program relationships

✔ Customer Relationship Management


Customer lifetime value – value of
– customer-perceived value the entire stream of purchases a
– ensuring satisfaction (formula?) customer makes over a lifetime of
patronage; Loyals spend more and
– engaging customers
stay around longer. 5x cheaper to
– ensuring retention and loyalty
keep an old customer rather than
acquire a new one.
The Marketing Process

Understanding Building Capturing value


Designing a Constructing an
from consumers
the market and consumer-driven integrated consumer and creating brand
the consumers marketing strategy marketing program relationships equity

✔ Measuring and analysis of results

– share of customer (“share of wallet”; portion of the customer’s purchases


– customer equity (total combined CLV of all of the company’s customers)
The Marketing Process

Capturing value
Understanding Designing a Constructing an Building
from consumers
the market and consumer-driven integrated consumer
and creating brand
the consumers marketing strategy marketing program relationships equity
Questions?
Insights?
quiz

1–5. FIVE concepts in marketing strategy philosophy

6–10. FIVE fundamental steps in the marketing


process.

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