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chapter 10: Marketing

marketing
the process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods, and services to create exchanges that satisfy individual and organizational objectives.
conception
an idea or view
promotion
Advance an employee earns by being productive, cooperation, dependable, and highly skilled.
distribution
Determining the best ways for customers to locate,obtain,and use the products and services of an organization. Involves moving the product each step from the deign idea to the consumer.
pricing
A marketing function that involves the determining and adjusting of prices to maximize return and meet customers’ perceptions of value.
four parts of marketing:
-You see
-you hear
-you read
-you interact
things that consumers don’t know when they purchase…
Product distribution
Establishing and accepting credit
Online payments
Gathering data on consmer needs
Using data to advertise, improve products, test new products, etc
true or false, more time and money is spend in business-to-business marketing than in marketing products and services to final consumers?
true
What types of businesses are involved in marketing activities?
1-Marketing research firms
2-Advertising agencies
3-Shipping and delivery companies – pickup/delivery of documents and packages
4-Transportation companies – trucking, railroad, air/ship freight
5-Financial services companies – issue and manage credit
6-Wholesalers and retailers – distribute, store, and sell products
*7 marketing functions *
1.Product/Service Management
2.Distribution
3.Selling
4.Marketing-Information Management
5.Financing
6.Pricing
7.Promotion
true or false, Marketing activities often cost 50% or more of the selling price of a product or service
true, this affects a products profit margin.
What is Marketing Planning aimed at ?
satisfying customer needs better than competitors
Marketing Strategy
a company’s plan that identifies how it will use marketing to achieve its goals
target market
a specific group of consumers that have similar wants and needs
marketing mix
he blending of four marketing elements: product, distribution, price, and promotion
steps to marketing stragetgy
1-Identify a target market!
2-Create a marketing mix!
Marketing Orientation
considers the needs of customers when developing a marketing mix.
“steps” to marketing orientation
1-Use research to study customers and their needs
2-Use the results of that research to plan a marketing mix designed to satisfy those needs
The Cruise Industry
1.Will first study possible customers and the similarities and differences in vacation wants and needs.
2.Then it will select the target market that presents the best opportunity for planning a successful cruise.
3.Using info about the target market, the company develops the marketing mix:
when a company develops the marketing mix it…
-The product is an exciting and relaxing cruise experience that includes onboard and offshore activities/excursions
-Distribution will include: documents needed, arranging travel to and from ports, handling baggage, etc.
-Pricing includes payment options and scaled accommodations to meet budgets of travelers
-Promotions offer information to interest prospective customers
what are the two types of consumers?
-Final consumers
-Business consumers
Final consumers
persons who buy products and services mostly for their own use
Business consumers
persons, companies, and organizations that buy products for the operation of a business, for incorporation into other products and services, or for resale to their customers
Consumer Decision Making Process-
the specific sequence of steps consumers follow to make a purchase
steps to the Consumer Decision Making Process
1. Recognize a need
2.Gather information
3.Select and evaluate alternatives
4.Make a purchase decision
5.Determine the effectiveness of the decision
Buying Motives
the reasons consumers decide what products and services to purchase
types of Buying Motives
1.Emotional buying motives: based on feelings, beliefs, and attitudes
-Gifts for others
-Protection/security
2. Rational buying motives: guided by facts and logic
-Most cost-effective option
-Highest customer rating
examples of new products
-Internet
-Airbags
-UPC scanning equipment
-Artificial hearts
examples of not new products
-Iphone 5
-2013 Honda Accord
-Windows 2010
-Ipad Mini

these are improvements

Marketing Research
finding solutions to problems through carefully designed studies involving consumers
solutions found with marketing research
New technology
Product improvement
true or false, Many advertisers use the word “new” to describe the newer features or technology used in the creation of the product.
true
Steps in Marketing Research
1.Define the marketing problem
2.Study the situation
3.Develop a data collection
4.Cather and analyze information
5.Propose a solution
secondary research
Uses old data to solve new problems.
primary research
Uses new data to solve current problems.
Types of research studies:
-Surveys
-Focus Groups
-Observations
-Experiments
Surveys –
gather information from people using a carefully planned set of questions
Focus Groups –
a small number of consumers take part in a group discussion (experiences, thoughts, opinions, suggestions)
Observations –
when information is collected by recording the actions of consumers
Experiments –
presents two carefully controlled alternatives to subjects in order to determine which is preferred or has better results
which is the most important of the four elements to the marketing mix is more critical?
product.
Product
everything a business offers to satisfy a customer’s needs
Parts of a Product
1.Basic Product
2.Product Features
3.Options
4.Brand Name
5.Packaging
6.Warranty/Guarantee
six parts to that product.
-Basic Product
-Product Features
-Options
-Brand Name
-Packaging
-Warranty/Guarantee
Product Planning Procedures
1.Idea Development
2.Idea Screening
3.Strategy Development
4.Production and Financial Planning
5.Limited Production and Test Marketing
6.Full-Scale Production
Services –
activities that are consumed at the same time they are produced
Intangible –
they have no physical form
Inseparable –
they are consumed at the same time that they are produced
-MUST be available where and when the customer wants to consume it!
Perishable –
the availability of service must match the demand for that service at a specific time (e.g. airline seats, concert tickets, cab fare)
Heterogeneous –
there will be difference in the type and quality of service provided depending on skill, training, demeanor, and motivation of the service provider.
Pricing Factors
-Supply and Demand
-Uniqueness
-Age
-Season
-Complexity
-Convenience
Price-
the money a customer must pay for a product or service
formula for determining price
selling price=product cost+operating cost+profits
Selling price –
price paid by the customer for the product
Product costs –
costs to the manufacturer of producing the product or the price paid by other businesses to buy the product
Operating expenses –
all expenses of operating the business that are associated with the product (salaries, storage, utilities, taxes, etc)
Profit –
is the amount of money available to the business after all costs and expenses have been paid
Gross margin:
the difference between the selling price and the product costs
Markup –
The amount added to the cost of a product to set the selling price.
true or false, The markup is equal to the expected gross margin.
true
*statistic*
If a product costs $15 and has a 100% markup, the cost to the consumer will be $30
Markdown –
a reduction from the original selling price
can a small markdown can still result in a company making a profit as well as reducing inventory?
yes
Channel Members-
the businesses that take part in a channel of distribution
Direct Channel of Distribution:
products move straight from the producer to the consumer
Indirect Channel of Distribution:
includes one or more other businesses between the producer and the consumer
Promotion –
any form of communication used to inform, persuade, or remind
what are promotions used for?
– to influence knowledge, beliefs, and actions about products, services, or ideas
-To promote effectively, they must first understand the communication process.
true or false, When a business knows their target market, they can more effectively use the communication process and therefore meet the needs/wants of the consumer?
true
Personalized Promotion-
communicates directly with each consumer with information tailored to that person
what is the MOST effective form of marketing communication?
personalized promotion
– it is also the most expensive
Personal Selling-
is direct, individualized communication with prospective customers to assess their needs and assist them in satisfying those needs with appropriate products and services.
Mass Promotion-
communicates with many people at the same time with a common message
Advertising –
is any paid form of communication through mass media directed at identified consumers to provide information and influence their actions.
Publicity –
non-paid promotional communication presented by the media rather than by the business or organization that is being promoted
Public Relations –
ongoing program of non-paid and paid communications and is planned to favorably influence public opinion about an organization, marketing effort, idea or issue
Sales Promotion –
activities and materials designed to reinforce a company'[s brand and image. Provides a direct incentive to immediately make a purchase.
Mass Personalization-
combines the advantages of personalize and mass promotion
steps to mass personalization
-Begins with promotion through mass media such as newspapers, mass mailings, or the Internet
-Customers then see the promotion and become interested
-The company then provides an easy-to-use method for the consumer to gather more personalized information
Marketing mix is made of four things
Product
Price
Promotion
Distribution
FACTS ABOUT ADVERTISMENT
-it must be paid
-it doesn’t pay off immediately

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