lectures in marketing

Lectures in Marketing Prepared by: Dr.Mayar Farrag El-Sayed Dr.Mayar Farrag Elsayed Page Part 1.Understanding marketing: Chapter 1: Marketing in a changing world: creating customer satisfaction Chapter 2: strategic planning and the market process Chapter 3: The global marketing environment Chapter 1: Dr.Mayar Farrag Elsayed Page Marketing in a changing world: creating customer satisfaction Chapter Overview In this chapter, we introduce the basic concepts of marketing It starts with the question, “What is marketing?” Simply put, marketing is managing profitable customer relationships The aim of marketing is to create value for customers and to capture value from customers in return Next is discussed the five steps in the marketing process – from understanding customer needs, to designing customer-driven marketing strategies and programs, to building customer relationships and capturing value for the firm Finally is discussed the major trends and forces affecting marketing in this age of customer relationships Marketing is the delivery of customer satisfaction at a profit The goal of marketing is to attract new customers by promising superior value, and to keep current customers by delivering satisfaction Some people think that only large business organizations operating in highly developed economies use marketing, but Dr.Mayar Farrag Elsayed Page sound marketing is critical to the success of every organization—whether large or small, for-profit or nonprofit, domestic or global Large for-profit firms such as Coca-Cola, McDonald's, Sony, IBM, General Electric, Federal Express, Wal-Mart, and Marriott use marketing But so nonprofit organizations such as colleges, hospitals, museums What is marketing? What does the term marketing mean? Many people think of marketing only as selling and advertising And no wonder— every day we are bombarded with television commercials, newspaper ads, direct mail, and sales calls Someone is always trying to sell us something Therefore, you may be surprised to learn that selling and advertising is only the tip of the marketing iceberg Although they are important, they are only two of many marketing functions, and often not the most important ones Dr.Mayar Farrag Elsayed Page Today, marketing must be understood not in the old sense of making a sale—"telling and selling"—but in the new sense of satisfying customer needs If the marketer does a good job of understanding consumer needs; develops products that provide superior value; and prices, distributes, and promotes them effectively, these products will sell very easily Marketing A social and managerial process by which individuals and groups obtain what they need and want through creating and exchanging products and value with others We define marketing as a social and managerial process by which individuals and groups obtain what they need and want through creating and exchanging products and value with others To explain this definition, we examine the following important terms: needs, wants, and demands; products; value, satisfaction, and quality; exchange, transactions, and relationships; and markets Dr.Mayar Farrag Elsayed Page Figure 1-1 shows that these core marketing concepts are linked, with each concept building on the one before it NEEDS , WANTS , AND DEMANDS The most basic concept underlying marketing is that of human needs Human needs are states of felt deprivation Humans have many complex needs Dr.Mayar Farrag Elsayed Page These include basic physical needs for food, clothing, warmth, and safety; social needs for belonging and affection; and individual needs for knowledge and self-expression These needs are not invented by marketers; they are a basic part of the human makeup When a need is not satisfied, a person will try either to reduce the need or look for an object that will satisfy it Wants are the form taken by human needs as they are shaped by culture and individual personality A hungry person in Egypt may want a fool or falafel sandwich Wants are described in terms of objects that will satisfy needs As a society evolves, the wants of its members expand As people are exposed to more objects that arouse their interest and desire, producers try to provide more want-satisfying products and services People have almost unlimited wants but limited resources Thus, they want to choose products that provide the most value and satisfaction for their money When backed by buying power, wants become demands Dr.Mayar Farrag Elsayed Page Consumers view products as bundles of benefits and choose products that give them the best bundle for their money Thus, a Fiat Car means basic transportation, low price, and fuel economy A Mercedes means comfort, luxury, and status Given their wants and resources, people demand products with the benefits that add up to the most satisfaction Outstanding marketing companies go to great lengths to learn about and understand their customers' needs, wants, and demands They conduct consumer research, focus groups, and customer clinics They analyze customer complaint, inquiry, warranty, and service data They train salespeople to be on the lookout for unfulfilled customer needs They observe customers using their own and competing products, and interview them in depth about their likes and dislikes In these outstanding companies, people at all levels—including top management—stay close to customers in an ongoing effort to understand their needs and wants Dr.Mayar Farrag Elsayed Page For example, top executives from Wal-Mart spend two days each week visiting stores and mingling with customers At Motorola, in addition to surveying customers about their quality needs, analyzing customer complaints, and studying customer service records, top executives routinely visit customers at their offices to gain better insights into their needs PRODUCTS People satisfy their needs and wants with products A product is anything that can be offered to a market to satisfy a need or want Usually, the word product suggests a physical object, such as a car, a television set, or a bar of soap However, the concept of product is not limited to physical objects—anything capable of satisfying a need can be called a Dr.Mayar Farrag Elsayed Page product The importance of physical goods lies not so much in owning them as in the benefits they provide Marketers often use the expressions goods and services to distinguish between physical products and intangible ones Moreover, consumers obtain benefits through other vehicles, such as persons, places, organizations, activities, and ideas Many sellers make the mistake of paying more attention to the physical products they offer than to the benefits produced by these products They see themselves as selling a product rather than providing a solution to a need VALUE , SATISFACTION , AND QUALITY Consumers usually face a broad array of products and services that might satisfy a given need How they choose among these many products and services? Consumers make buying choices based on their perceptions of the value that various products and services deliver Dr.Mayar Farrag Elsayed Page 10 Chapter 12 Marketing And Society: Social Responsibility And Ethics Chapter Overview In this final chapter, we look at the concepts of sustainable marketing, meeting the needs of consumers, businesses, and society – now and in the future – through socially and environmentally responsible marketing actions The chapter begins with a definition of sustainable marketing and then looks at some common criticisms of marketing as it impacts individual consumers and other businesses Next, it covers consumerism, environmentalism, and other citizen and public actions that promote sustainable marketing Finally, the chapter looks at how companies themselves can benefit from proactively pursuing sustainable marketing practices that bring value not just to individual customers but also to society as a whole Page 272 Sustainable marketing actions are more than just doing the right thing; they are also good for business SUSTAINABLE MARKETING Sustainable marketing calls for meeting the present needs of consumers and businesses while also preserving or enhancing the ability of future generations to meet their needs Figure 20.1 compares the sustainable marketing concept with other marketing concepts from earlier chapters The marketing concept recognizes that organizations thrive from day to day by deterring the current needs and wants of target group customers and fulfilling those needs and wants more effectively and efficiently than the competition Page 273 It focuses on meeting the company’s short-term goals by giving customers what they want now However, satisfying consumer’s immediate needs and desires doesn’t always serve the future best interest of ether customers of the business Whereas the societal marketing concept considers the future welfare of consumers and the strategic planning concept considers future company needs, the sustainable marketing concept considers both Sustainable marketing calls for socially and environmentally responsible actions that meet both the immediate and future needs of customers and the company CONSUMER ACTIONS TO PROMOTE SUSTAINABLE MARKETING Consumerism Page 274 American business firms have been the targets of organized consumer movements on three occasions The first consumer movement took place in the early 1900s It was fueled by rising prices, Upton Sinclair’s writings on conditions in the meat industry, and scandals in the drug industry The second consumer movement, in the mid-1930s, was sparked by an upturn in consumer prices during the Great Depression and another drug scandal The third movement began in the 1960s Consumers had become better educated, products had become more complex and potentially hazardous, and people were unhappy with American institutions Consumerism is an organized movement of citizens and government agencies to improve the rights and power of buyers in relation to sellers Traditional sellers’ rights include:  The right to introduce any product in any size and style, provided it is not hazardous to personal health or safety; or, if it is, to include proper warnings and controls Page 275  The right to charge any price for the product, provided no discrimination exists among similar kinds of buyers  The right to spend any amount to promote the product, provided it is not defined as unfair competition  The right to use any product message, provided it is not misleading or dishonest in content or execution  The right to use any buying incentive programs, provided they are not unfair or misleading Traditional buyers’ rights include:  The right not to buy a product that is offered for sale  The right to expect the product to be safe  The right to expect the product to perform as claimed Consumer advocates call for the following additional consumer rights:   The right to be well informed about important aspects of the product  The right to be protected against questionable products and marketing practices Page 276  The right to influence products and marketing practices in ways that will improve the “quality of life.”  The right to consume now in a way that will preserve the world for future generations of consumers Environmentalism Environmentalism is an organized movement of concerned citizens, businesses, and government agencies to protect and improve people’s living environment The first wave of modern environmentalism in the United States was driven by environmental groups and concerned consumers in the 1960s and 1970s The second environmentalism wave was driven by government, which passed laws and regulations during the 1970s and 1980s governing industrial practices impacting the environment The third environmentalism wave is a merging of the first two waves in which companies are accepting more responsibility for doing no harm to the environment Page 277 More and more companies are adopting policies of environmental sustainability Figure 20.2 shows a grid that companies can use to gauge their progress toward environmental sustainability Pollution prevention - Eliminating or minimizing waste before it is created Product stewardship - Minimizing not just pollution from production and product design but all environmental impacts throughout the full product life cycle, and all the while reducing costs Design for environment (DFE) and cradle-to-cradle practices are practices that involve thinking ahead to design products that are easier to recover, reuse, or recycle and developing programs to reclaim products at the end of their lives The “beyond greening” activities identified in Figure 20.2 look to the future New clean technology Many organizations that have made good sustainability headway are still limited by existing technologies Page 278 To create fully sustainable strategies, they will need to develop innovative new technologies Sustainability vision Serves as a guide to the future It shows how the company’s products and services, processes, and policies must evolve and what new technologies must be developed to get there Page 279 BUSINESS ACTIONS TOWARD SUSTAINABLE MARKETING Sustainable Marketing Principles The philosophy of sustainable marketing holds that a company’s marketing should support the best long-run performance of the marketing system Enlightened marketing consists of five principles: Consumer-Oriented Marketing Consumer-oriented marketing means that the company should view and organize its marketing activities from the consumer’s point of view Only by seeing the world through its customers’ eyes can the company build lasting and profitable customer relationships Customer-Value Marketing Customer-value marketing means the company should put most of its resources into customer value-building marketing investments Page 280 By creating value for consumers, the company can capture value from consumers in return Innovative Marketing Innovative marketing requires that the company continuously seek real product and marketing improvements Sense-of-Mission Marketing Sense-of-mission marketing means that the company should define its mission in broad social terms rather than narrow product terms Societal Marketing Societal marketing means an enlightened company makes marketing decisions by considering consumers’ wants and interests, the company’s requirements, and society’s long-run interests Page 281 Products can be classified according to their degree of immediate consumer satisfaction and long-run consumer benefit (Figure 13.4)  Deficient products have neither immediate appeal nor long-run benefits  Pleasing products give high immediate satisfaction but may hurt consumers in the long run  Salutary products have low appeal but may benefit consumers in the long run; for instance  Desirable products give both high immediate satisfaction and high long-run benefits Page 282 Marketing Ethics Corporate marketing ethics policies are broad guidelines that everyone in the organization must follow What principle should guide companies and marketing managers on issues of ethics and social responsibility? One philosophy is that such issues are decided by the free market and legal system A second philosophy puts responsibility not on the system but in the hands of individual companies and managers Written codes and ethics programs not ensure ethical behavior The Sustainable Company Sustainable companies are those that create value for customers through socially, environmentally, and ethically responsible actions Page 283 Sustainable marketing provides the context in which companies can build profitable customer relationships by creating value for customers in order to capture value from customers in return, now and in the future Page 284 Questions chapter 12 What is sustainable marketing? Explain how the sustainable marketing concept differs from the marketing concept and the societal marketing concept Marketing’s impact on individual consumers has been criticized Discuss the issues relevant to this impact Discuss the types of harmful impact that marketing practices can have on competition and the associated problems Can an organization focus on both consumerism and environmentalism at the same time? Explain Describe the five sustainable marketing principles and explain how companies benefit from adhering to them Good ethics is the cornerstone of sustainable marketing Explain what this means and discuss how companies practice good ethics Page 285 References: Bovee,Thill, Business In Action (6th Edition), Pearson Education ,Prentice Hall, 2013 Chris Fill, Marketing Communication (4th Edition), Pearson Education, Aug 2005 George E Belch & Michael A Belch, Advertising & Promotion (5th Edition), McGraw-Hill Higher Education, 2001 Michael Solomon & Gary Bamosy, Consumer Behavior (3rd Edition), Pearson Education, March 2006 Philip Kotler & Gary Armstrong, Anwar Habib, Ahmed Tolba,Principles Of Marketing Arab World Edition (7th Edition), Pearson Education, Prentice Hall, 2011 Philip Kotler & Kevin Keller, Principles Of Marketing (11th Edition), New York: Pearson Education, March 2005 William Wells & Sandra Moriarty, Advertising (7th Edition), Pearson Education, Jun 2005 Page 286 ... 1.Understanding marketing: Chapter 1: Marketing in a changing world: creating customer satisfaction Chapter 2: strategic planning and the market process Chapter 3: The global marketing environment... Page Marketing in a changing world: creating customer satisfaction Chapter Overview In this chapter, we introduce the basic concepts of marketing It starts with the question, “What is marketing? ”... Marriott use marketing But so nonprofit organizations such as colleges, hospitals, museums What is marketing? What does the term marketing mean? Many people think of marketing only as selling and