The most fundamental method an organization uses to discover consumer needs is marketing research

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Cordelia Singleton
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1 The most fundamental method an organization uses to discover consumer needs is marketing research Marketing is considered beneficial because Marketing can improve global competition Marketing creates utility for customers Price what is exchanged for the product (discounts) Product a good, service or idea to satisfy needs (releases new product) Place a means of getting the product to the consumer (offers takeout or delivery) Promotion a means of communication between seller and buyer (flyers) The American Marketing Assocation states that, Marketing is the activity for creating, communicating, delivering and exchanging offerings that benefit the organization, its stakeholders and society at large. The Marketing department shapes and is shaped by many external people, organizations and forces. Suppliers and Shareholders would not be considered an environmental force. A target market is a one or more specific group of potential consumers toward which an organization directs its marketing program Relationship marketing links the organization to its customer, employees, suppliers and other partners for mutual long term benefits. Ultimate consumers use goods and services purchased for a household Two principles contained in the marketing concept An organization should strive to satisfy the needs of consumers An organization should try to achieve its own goals Companies with the strategy they use to deliver value for their customers Wal mart = best price Nike = best product Home depot = best service The four P s or marketing mix, are the controllable set of activities that a firm uses to respond to the needs of its target market A marketing program is a plan that integrates the marketing mix to provide a good, service or idea to prospective buyers Firms develop products and services with the understanding that their ultimate goal is to satisfy their customers needs

2 Business orientations in the correct historical order, oldest on top, newest on bottom Production era (buyers accept virtually any goods because of the relative scarcity of goods) Sales era (manufacturers can produce a surplus of goods and must find new buyers) (answer to there overproduction) Marketing concept era (organizations focus on identifying customer needs and using his to create value) Customer relationship era (firms seek continuously to satisfy the high expectations of those they serve) Place is one of the elements of the four Ps that embodies all activities essential to get the product to the right customer when and where that customer wants it Customer value benefits; after sale service, quality, convenience The essence of successful marketing is that firms provide unique value in order to gain loyal customers When a consumer gives money or something else of value for something he or she values this is called an exchange Customer value reflects the relationship of benefits to price or what you get for what you give Financial profit responsibility, organizations are focusing on ethics and social responsibility Customer value is the unique combination of benefits received by targeted buyers at a specific price Marketing impacts these groups in society: suppliers, customers and owners Manufacturers in the production oriented marketing era were concerned with increasing output not with satisfying needs of consumers Possession making an item easy to purchase Time having the product available when needed Place having the product available where consumers need it Form the production of the good or service Henry Ford can have any color they want so long as its black (production orientation in business)

3 Product is the part of the marketing mix that aims at creating value for the consumer by providing features and benefits for the consumer needs In order for marketing to occur, both parties involved must have The desire to satisfy a need The ability to satisfy a need Two or more parties with unsatisfied needs Characteristic of the marketing concept era Product design focused on consumers needs Marketing was integrated into each phase of business Goods, services and ideas are marketed The internal response that customers have to all aspects of an organization and its offering is known as the customer experience CRM stands for customer relationship management Who benefits from effective marketing? Organizations who sell Society as a whole Consumers who buy One of the core aspects of marketing, borrowed from economics, includes an exchange, which is a transaction in which things of value are traded between the buyer and seller Promotion, product and price are elements of the marketing mix The idea that a company should attempt to satisfy its customers needs while at the same time try to achieve its own objectives is known as the marketing concept Listening to your customers in order to develop a better product is an example of effective marketing research If you develop a desire for a product that does not exist yet in the marketplace, this would be considered an unsatisfied want, one of the conditions required for marketing to occur To be in an organization market, it is not enough for a customer just to want a product because it would satisfy unmet needs, a customer must also have the ability to buy, financially and otherwise Environmental forces they are largely beyond the control of the marketer, and social and economic forces are examples

4 Firms or agencies that buy goods and services for their own use or for resale are known as organizational buyers Organizations increasingly consider the social and environmental consequences of their actions for all parties When a firm has transcended a production or selling orientation, and attempts to discover and satisfy its customers needs and wants the firm is market oriented Benefit of effective marketing in society: improves quality or products and services Organizational buyers manufacturers, wholesalers, retailers and government agencies purchase goods and services Organization should seek a balance among differing interests The relationship between society and marketing: society affects marketing and sometimes marketing has an important impact on society An organization whose primary organizational goal is operational efficiency or client satisfaction would be classified as a nonprofit organization Visionary organizations foundation It explains why an organization exists It provides guidance and inspiration to its employees

5 The marketing department is part of the functional level, in terms of strategy within an organization Organizational culture is defined as a set of values, ideas, attitudes and norms of behaviour that is learned and shared among the members of an organization 2 techniques that aid in decisions about here an organization wants to go: business portfolio and diversification Organizations core values are the fundamental, passionate, and enduring principles that guide its conduct over time (don t change much over time) 3 phases of the strategic marketing process Planning Implementation Evaluation Developing the marketing mix and its budget are part of which step in the planning phase of the strategic marketing process? The Marketing Program A statement of an accomplishment of a task to be achieved, often by a specific time, is known as a goal SWOT analysis Strength build on it Weakness correct it Opportunity exploit it Threat avoid it Implementation phase of the strategic marketing process Obtaining resources Developing planning schedules Designing the marketing organization The clear, broad, underlying industry category or market sector of an organizations offering defines its business Elements that define an organizations direction Specific goals The business it is in Points of difference are characteristics of a product that make it superior to competitive substitutes

6 A marketing dashboard is the visual computer display of the essential information related to achieving a marketing objective Searching for growth opportunities, organizations using diversification analysis consider both current and new options for products and markets A marketing metric is a measure of the quantitative value or trend of a marketing activity or result Acting on deviations, both positive and negative is an important part of what phase in the strategic marketing process. Evaluation In portfolio analysis, management evaluates the firms various product and business and then allocated resources according to potential profit outlook, firms typically perform it at the SBU or product line level of the firm A marketing strategy is the means by which a marketing goal is to be achieved Marketing tactics are detailed day today operational decisions essential to the success of the former BCG Question Marks low relative market share, high market growth rate Stars high relative market share, high market growth rate Cash Cows high relative market share, low market growth rate Dogs low relative market share, low market growth rate A visionary organizations core values, mission and organizational culture make up its foundation The functional level is made up of departments, which provide specific and focused strategic direction SBU Strategic business unit Managers of an SBU set specific strategic direction Firms with a single business focus may not have SBU s Obtaining resources and developing planning schedules are part of implementation Portfolio analysis Firms typically perform it at the SBU or product line level of the firm

7 Management allocated its resources to products with the greatest potential to be profitable Management evaluates the firms various products and businesses Business portfolio analysis and diversification analysis help organization to answer where do we want to go? The corporate level is where top management directs overall strategy for the entire organization A goal is a statement of a task to be achieved Profit Is the money left over after a business firms total expenses are subtracted from its total revenues and is the reward for the risk it undertakes in marketing its offerings Organizations core competencies are its special capabilities, skills, technologies, resources that distinguish it from other organizations and provide value to its customers An organization that determine in which business it wishes to operate and what its special goals are is setting its direction Organization to determine where it is at the present time (competencies, competitors and customers) To define its business, an organization can start by looking at the set of organization that sell similar offerings Market Share It is the % of sales of an industry accounted for by a specific firm It may need to be increased, even at the expense of profit, if industry status or prestige is at stake Last step in planning phase of strategic marketing process The marketing program Qualities of a good mission statement clear and compelling picture of an envisioned future Market share Is the ratio of sales revenue of the firm to total sales in the industry, including the firm itself 3 levels of strategy in organization: corporate, strategic business unit and functional (LOWEST LEVEL) Strategic business unit is a subsidiary, division or unit of an organization that markets a set of related offerings to a clearly defined group of customers

8 opportunity refer to in SWOT analysis favorable aspects of the external environment threat external and unfavorable weakeness unfavorable and internal Organizations that develop similar offerings, when grouped together create an industry Broad ways that organizational strategies may vary: offering and level Mission statement states an organizations function in society A company that has a unique strength relative to competitors, often based on quality, time, cost, or innovation has a competitive advantage A diversification strategy, one of four possible market product strategies included in diversification analysis introduces a new product to a new market (most risky) Step 1 performing a situation analysis using SWOT Businesses can pursue several different types of goals that they would like to achieve, such as those pertaining to market share, quality or customer satisfaction A market penetration growth strategy focuses on increasing sales of the firms current products to its current target markets (existing customers) The product development strategy offers a new product or service to a firms existing market Strengths refer to the favorable internal attributes of the firm In defining ones business, avoid narrow definition that is not focuses on the customer needs Growing demand for ones product in an overseas market is an opportunity for an organization Rethink business model technological innovation The marketing department can keep the organization focused on creating value both for it and for customers by looking outward Market segmentation is most essential for Market product focus Market development is a strategy to sell existing products to new markets Chief marketing officer (large organization)

Copyright 2013 by The McGraw-Hill Companies, Inc. All rights reserved.

McGraw-Hill/Irwin Copyright 2013 by The McGraw-Hill Companies, Inc. All rights reserved. FIGURE 2-A How an industry is structured 2-6 FIGURE 2-1 The board of directors oversees the three levels of strategy