Introduction

Chapter 1: the basics

Introduction

Petra Vijncke

First, second and third year Marketing

Advertising agency

Petra.vijncke@arteveldehs.be

Check Chamilo before mailing !!

Starting from level 0

Markets change fast

So do media channels

Communication? Constant change

Consumer do too

Survive = be aware

Deadlines?

Assignments?

Exam?

Check Chamilo

2 sessions every week (Wednesday

morning: 8.30-11.30 am)

Me = powerpoints

You = take notes !

There is NO hand book or course book !

Marketing basics and jargon

Marketing insight and problem solving

And to convince you to study Marketing next year

Marketing is the process of communicating the value of a product or service to customers, for the purpose of selling that product or service.

Creating, delivering and communicating valueto customers

Customer relationship management that also benefits the organization.

Science of choosing target markets through market analysis and market segmentation, as well as understanding consumer behavior

Chapter 1:

the basics

1. Introduction

2. Definition

3. Basic concepts and voc

4. Marketing management concepts

5. Marketing approaches

In the factory, we make cosmetics. In the

store, sell hope (Charles Revlon)

Marketing = the full picture

› Digital, viral, social networks, outdoor,

guerilla, mass media, retail, sales, PR,

reputation management, crisis

communication, product placement,

events, …

Example: Coca Cola

It’s all about “branding”

Ketchup = your brand ?

Brands create value

Value = perceived quality

Perceived quality = certain price setting

Text message parking

Solar panels

Kai Mook

Twitter

Zumba

Not just selling

But also satisfying

customers’ needs !

Better customer deal: value for money

› Delivering superior customer value

› Sustainable competitive advantage

Example:

› In 1997, M&M’s was almost bankrupt

› By 2014, they are the best selling candy in

the USA

› What happened?

But marketing is so much more:

› Market research: think before you act

Who is my target audience?

What does my target audience want?

Needs, desires, …

› Is my target market attractive and big

enough?

› And what is my competition doing?

Analyse consumer behaviour

› How do my consumers buy?

› Steps in the decision process

Research product development

› Product features?

› Importance of quality, packaging, service,

warrants, design, branding, …

Price setting needs to be ‘right’› ‘acceptable’ price

Distribution channels› Availability?

› Power of channels?

Marketing communication› = advertising

So, if I asked you to define ‘marketing’,

what would your answer be?

Process of planning and executing the › conception,

› pricing,

› promotion and

› distribution of

› ideas, services and goods

› to create exchanges

› that have value and

› satisfy goals

› for customers, clients, partners, and society at large.

4 P’s

Example

GOOD + SERVICE

EXCHANGE AND CREATE VALUE

SATISFY GOALS FOR …

Is marketing important/necessary ?

› Roots of all business = products and services

› Need to be marketed and sold

› No turnover? No business and no

employment

Yes !

Marketing: a ‘must’ or a ‘gift’ ?

› Depends on the product/service and the

branche

› Constant innovation necessary

› Competition is lurking around the corner

› Invest in strong brands

› Focus on quality and service

› Build relationship with consumers and other

stakeholders

Must

› Local hospital

› You need to be

there ‘anyway’

› For routine check-

ups and

appointments

Gift

› Big, university

hospital

› Best doctors

› Build on reputation

› Scientists and

experts with

international

experience

› Advanced research

Watch out: marketing is not an exact

science

› There are often no right/wrong answers

› Business instinct alone is not enough

› Need to analyze the 4 P’s

Product

Price

Place

Promotion

Needs and wishes of consumer

What the consumerneeds to pay

Where the consumercan buy the product

How to promote the product

Example

‘Place’

Example 4 P’s:

Creating AND keeping customers

How ?

› CRM = customer relationship management

› Examples?

Different target markets

Different needs

Different processes

Needs are universal + general + motivational

Demand

Products are offered: advantages, satisfaction, value is communicated

Exchange – transaction

Aim for the right target market

Needs are satisfied

Examples ?

› Use of wifi, internet

› Computer

› Milk

› Toilet paper

› Bank account

› …

But what about:

Desire is limited and individual

Demand

Products are offered: advantages, satisfaction, value is communicated

Exchange – transaction

Aim for the right target market

Needs are satisfied

Example:

There is a desire but the means are limited

Demand

Products are offered: advantages, satisfaction, value is communicated

Exchange – transaction

Aim for the right target market

Needs are satisfied

Example?

Beware of the power of the different markets:› Sellers’ market: demand > offer

Shortage: power for the sellers

› Buyers’ market: demand < offer

Surplus: power for the consumers

Example: › tablet in 2010 vs 2014

› PlayStation and price evolution due tocompetition (Wii and Sony Xbox)

And what about this?

Transaction marketing

› Aim to enlarge target market

› Often short term profit thinking only

› Eg. “6 months for free”

Relationship marketing

› Sustainable customer relationship

› Long-term thinking

De-marketing› Efforts aimed at discouraging (not destroying)

the demand for a product

› Reasons:

a firm cannot supply in large-enough quantities

does not want to supply in a certain region because profit margin is too small

Common demarketing strategies: higher prices, scaled-down advertising, and product redesign.

FOCUS ON THE CUSTOMER

F

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MARKETING

ORIENTATION

PRODUCT

ORIENTATION

PRODUCTION

ORIENTATION

SELLING

ORIENTATION

PRODUCT CONCEPT

› Consumer wants products with the best

quality, presentation and features

› Organization constantly tries to improve the

product

› Danger: “a good product sells anyway”

› Example:

Other example:

PRODUCTION CONCEPT

› Customers want products which are widely

available and cheap

› Organizations aim for high production

efficiency and maximal distribution

› Conditions:

Consumer has limited means

Organization needs to lower production costs

Example:

SELLING CONCEPT

› Customer does not buy the product

(enough), so he/she must be convinced by

“hard selling”

› Very direct and often aggressive

› Dangers:

Unsought products

Overcapacity

‘We sell what we make’, instead of ‘we make

what we can sell’

Example:

MARKETING CONCEPT

› Analyze needs of consumers, satisfy these

needs and do that better than the

competition

› Features

Focus on customer satisfaction

Market research

Analyze competition

Example

AND IN 2014: the new trends in

marketing are…

› Green marketing: Ecover

› Ethnic marketing

› Gay marketing

› Focus on sustainable development:

people +planet + profit

Eg. Ben & Jerry’s

Golden advice: Be REAL and AUTHENTIC

› Avoid scandals

› Crisis management

› Eg. Nike, Shell, McDonald’s, IKEA, HEMA

B2C marketing Marketing aimed at the final consumer

Eg. on a billboard

B2B marketing

› = trade marketing

› Marketing aimed at the retailers or

distributors or other channels in betweeen

› Eg. Douwe Egberts negotiations with

Delhaize

› Eg. IT compay offering business solutions

Retail marketing:

› Marketing from the retailer and aimed at the

final consumer

Services marketing:

› Market a service (police, electricity, school,

hospital, lawyer, mobile phone operator, city

marketing, …)

Non-profit marketing:

› Money earned is used for investments in the

organisation, not for personal gain/profit

› Artevelde, local sport club, charity org, …

But remember: marketing is not an exact

science

› Duvel Brewery creates new beer flavour

› Guided tours in brewery

› Drink sth in the shop/bar afterwards

› Take home gadget + mini bottle of new

flavour

› B2B, B2C, retail, services marketing, …?

› What do you think?

Extended definition of marketing

4 P’s

Marketing jargon and vocabulary

4 marketing concepts

Trends of the year 2014

Different marketing approaches

Marketing is not an exact science