1. Principles of Marketing MKT3010 Chapter 1 Overview of Marketing Patricia Knowles, Ph.D. Associate Professor Clemson University 1

2. 2 Principles of Marketing MKT3010 2 Overview of Marketing These are the learning objectives guiding the chapter and will be explored in more detail in the following slides. Define the role of marketing in organizations. Describe how marketers create value for a product or service. Understand why marketing is important both within and outside the firm. LO1 LO2 LO3 3. 33 What is Marketing? This new definition is somewhat controversial, because many feel it includes everything within marketing. Principles of Marketing MKT3010 Marketing is an organizational function and a set of processes for creating, capturing, communicating, and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders. 4. 44 Marketing is About Satisfying Customer Needs and Wants The ad is targeted to those who find taste to be an important element. Other benefits might include calorie-conscious or carbonated beverages. Principles of Marketing MKT3010 What group is Pepsi targeting with this ad? What other benefits of soft drinks might Pepsi advertise? What groups might these benefits appeal to? PRNewsFoto/PepsiCo; AP Photo. 5. 55 Marketing Entails an Exchange Each party to the exchange gives up something of value: The customer usually gives up money, however, sometimes they also give up time and information. The firm gives up the good or service. The exchange in the end is mutually beneficial. Principles of Marketing MKT3010 6. 66 Marketing Requires Product, Price, Place, and Promotion Decisions This is an overview of the 4Ps which will be discussed in greater depth. Principles of Marketing MKT3010 Product Creating value PRNewsFoto/PepsiCo; AP Photo. Price Capturing value Digital Vision Ltd. Place Delivering value BrandX/JupiterImages/Getty Images. Promotion Communicati on value Stockbyte/PunchStock. 7. 77 Product: Creating Value Students often can relate to goods and services, but the marketing of ideas is a new concept to them. Principles of Marketing MKT3010 The fundamental purpose of Marketing is to create value by developing a variety of offerings, including goods, services, and ideas, to satisfy customer needs. Goods Services Ideas Roz Wodward/Getty Images 8. 88 Price: Capturing Value A good example of how price expresses value is the variations in price associated with air travel. The prices can vary based on demand. Market pricing versus cost pricing. Principles of Marketing MKT3010 Price is everything a buyer gives up (money, time, energy) in exchange for the product. How much are customers willing to pay and can a profit can be made at that point. AP Photo/The Canadian Press, Jacques Boissinot. 9. 99 Place: Delivering the Value Proposition Place delivers the product to the customers. Students may overlook the importance of this component of the marketing mix because it is not as readily visible from the consumer perspective. Principles of Marketing MKT3010 Place, or supply chain management, describes all activities necessary to get the product to the right customer when the customer wants it. Where would you find this product in the store? Courtesy Horizon Organic Dairy 10. 1010 Promotion: Communicating Value Calvin Kleins provocative advertising has helped create an image that is filled with youth, style, and sex appeal. Principles of Marketing MKT3010 Photo by Paul Hawthorne/Getty Images Promotion is communication by a marketer that informs, persuades, and reminds potential buyers about a product or service to influence their opinions or elicit a response. 11. 1111 Marketing can be Performed by Individuals and Organizations This exhibit illustrates how the same product, a desktop computer, can be sold from firm to firm, from firm to consumer, and then be used consumer to consumer to sell C2C. Principles of Marketing MKT3010 C2C Consumer B B2C Consumer A B2B Retailer (Sells PCs & monitors) Manufacturer (Makes monitors) 12. 1212 Marketing Impacts Various Stakeholders Marketers affect many stakeholders. Customers represent one stakeholder group but others include all those in the supply chain, employees, and society at large. Supply chain partners include manufacturers, agents, wholesalers, retailers, and so on. Companies market to employees with employment marketing, also known as internal marketing, to recruit and retain the best employees. Principles of Marketing MKT3010 Courtesy National Fluid Milk Processor Promotion Board; Agency: Lowe Worldwide, Inc. Society Customers Employees Supply Chain 13. 1313 Marketing Helps Create Value Marketing has been through several eras. This exhibit graphically represents the changes over time from an emphasis on production to one based on value-based marketing. Principles of Marketing MKT3010 Now, we are in the value-based era, which maintains the market orientation but also includes a focus on giving greater value than the competition. Value reflects the relationship of benefits to costs. Value-based marketing means implementing a marketing strategy according to what customers value. Production Sales 2. Marketing 3. Value based marketing 4. 5. The production-oriented era took place around the turn of the 20th century, when most firms believed a good product would sell itself. In the sales-oriented era, production and distribution techniques improved and supply outpaced demand. Firms found an answer to overproduction by focusing on sales. In the market-oriented era, the focus was on what customers wanted. 14. 1414 Value-Based Marketing This is an examples of a value-based marketing ad. Principles of Marketing MKT3010 Pure Dark Chocolate Light Exquisite Cookie Courtesy Pepperidge Farm. 15. 1515 Check Yourself Principles of Marketing MKT3010 1. What is the definition of marketing? 2. Marketing is about satisfying ______ and ______. 3. What are the four components of the marketing mix? 4. Who can perform marketing? 5. What are the various eras of marketing? 16. 1616 How Do Firms Become Value Driven? Firms become value driven by focusing on four activities. Principles of Marketing MKT3010 Sharing Information Balancing Benefits with Costs Building Relationships with Customers 17. 1717 Check Yourself Principles of Marketing MKT3010 1. Does providing a good value mean selling at a low price? 2. What are the benefits of long-term relationships with customers? 3. How are marketers connecting with customers using social and mobile media? 18. 1818 Why is Marketing Important? Principles of Marketing MKT3010 19. 1919 Check Yourself Principles of Marketing MKT3010 1. List five factors that emphasize the importance of marketing. 2. A firm doing the right thing emphasizes the importance of marketing to _________. 20. 2020 Glossary Exchange is the trade of things of value between the buyer and the seller so that each is better off as a result. Goods are items that you can physically touch. Services are intangible customer benefits that are produced by people or machines and cannot be separated from the producer. Ideas include thoughts, opinions, and philosophies, and intellectual concepts which can be marketed. Supply chain is the group of firms that make and deliver a given set of goods and services. Value reflects the relationship of benefits to costs. Principles of Marketing MKT3010