Lecture Business: A changing world - Chapter 12: Customer-driven marketing

After reading this chapter, you will be able to: Define marketing and describe the exchange process; specify the functions of marketing; explain the marketing concept and its implications for developing marketing strategies; examine the development of a marketing strategy, including market segmentation and marketing mix;...

Chapter Twelve Customer­Driven Marketing     © 2003 McGraw­Hill Ryerson Limited The Exchange Process: Giving Up  One Thing in Return for Another Something of Value (money, 12-1 Buyer (goods, services, ideas) credit, labour,     goods) Seller Something of Value â2003McGrawưHillRyersonLimited MarketingCreatesUtility 12-2 Placeutility Timeutility Ownershiputility Formutility â2003McGrawưHillRyersonLimited FunctionsofMarketing • 12-3   Buying Selling  Transporting Storing   © 2003 McGraw­Hill Ryerson Limited • • • • Grading Financing Marketing research Risk taking The Breakdown of the  Marketing Concept 12-4a     © 2003 McGraw­Hill Ryerson Limited The Breakdown of the  Marketing Concept 12-4b     © 2003 McGraw­Hill Ryerson Limited Market/Target Market A market is a group of people who  have a need, purchasing power, and the  desire and authority to spend money on  goods, services, and ideas 12-5 A target market is a more specific  group of consumers on whose needs  and wants a company focuses its  marketing efforts     © 2003 McGraw­Hill Ryerson Limited Generational Marketing Canada’s oldest citizens  ­ ­ Baby boomers ­ 12-6 ­ Gen Xers ­ (born between 1966­1980) Generation Y   ­ ­   © 2003 McGraw­Hill Ryerson Limited the generation of great hope  desire products that reward them for hard  work the generation born in great economic  prosperity desire products that save time or simplify  living desire products that fit with the image of  self they are creating the most privileged generation desire products that are high­tech and  authentic and nontraditional shopping venues Marketing to Different  Generations (or target markets) What’s Cool? 12-7 According to Boomers Lexus LS 400 Gap Estee Lauder Palm Pilot Coke Nikes     © 2003 McGraw­Hill Ryerson Limited According to Generation Y Jeep Wrangler Delia’s Hard Candy Motorola Flex Pagers Mountain Dew Vans Source: Ellen Neuborne and Kathleen Kerwin, “Generation Y,” Business Week, February 15, 1999, pp. 82­83 Target Market Strategies Total­Market Approach Company 12-8 Single Marketing Strategy Total Target Market Concentration Approach Single Marketing Strategy Company Single Target Market Multisegment Approach Company  Marketing Strategy 1 Marketing Strategy 2     © 2003 McGraw­Hill Ryerson Limited Multiple Target Markets Bases for Segmenting  Markets • • • • 12-9   Demographics Geographic factors Psychographics Behavioristic characteristics   © 2003 McGraw­Hill Ryerson Limited The Marketing Mix: Product, Price,  Promotion, and Distribution 12-10 Product Promotion Customer Distribution â2003McGrawưHillRyersonLimited Price BuyingBehavior Psychologicalvariables 12-11 – perception – motivation – learning • Social variables – – – –   social roles reference groups social classes culture   © 2003 McGraw­Hill Ryerson Limited Trends in Buying Behavior 12-12   Arrivals Departures One­arm packs/hipsacks Pink Krav Maga Lowriders Bistros Tai Bo Anatomical wrap soles Scalp jewels Manic Street Preachers/Air Ostrich burgers Floating necklaces Backpacks Gray Pilates Motorcycles Clubs Tai Chi Platforms Glitter The Verve Turkey burgers Silver spring bracelets   © 2003 McGraw­Hill Ryerson Limited Source: http://www.demographics.com/publications/ ad/99_ad/9901_ad/ad990106e.htm, March 15, 1999 Who’s Buying Beetles? 12-13 Age of head of household: 18­24 25­34 35­44 45­54 55­64 65­74 75 and over   2% 14% 30% 35% 13% 5% 1%   © 2003 McGraw­Hill Ryerson Limited Source: USA Today, February 2, 1999, p. B­3 A Marketing Mix and the Marketing  Environment Political, Legal, and Regulatory Forces 12-14 Product Promotion Technological Forces     © 2003 McGraw­Hill Ryerson Limited Social Forces Customer Distribution Marketing Environment Price Competitive and Economic Forces Marketing Environment Trends Marriage rate dropping 68% 12-15 1998 Decline since 1970: 1970 56% The number of  adults married and living with their spouse declined to an all­time low in 1998 due to increasing levels of divorced and never married adults  White 59%, hispanic 51%, black 35% (only groups broken out) Source: Census Bureau   24% 19% 10% 3% Married, with spouse   © 2003 McGraw­Hill Ryerson Limited Divorced Never married 7% 8% Married, separated 3% 1% Widowed Source: USA Today, March 3, 1999, p. A­1 12-16 Technological Forces (bluefly.com Online Outlet)     © 2003 McGraw­Hill Ryerson Limited Solve the Dilemma 12-17   a What do you think were the main concerns with the  Olympus 2­door sports coupe? Is there a market for a  2­seat, $32,000 sports car when the Miata sells for  significantly less? b Evaluate the role of the marketing mix in the  Olympus introduction c What are some of the marketing strategies auto  manufacturers use to stimulate sale of certain makes  of automobiles?   © 2003 McGraw­Hill Ryerson Limited Explore Your Career Options 12-18 How will a career in marketing be  enhanced by knowledge about customer  buying behaviour and customer service?     © 2003 McGraw­Hill Ryerson Limited Additional Discussion  Questions and Exercises 12-19 Utility is the ability of a product to satisfy human needs and  wants. What are the four kinds of utility? Why are intermediaries helpful in distribution? What are some different forms of promotion? What is the difference between primary data and secondary  data? What are some sources for obtaining secondary data?     © 2003 McGraw­Hill Ryerson Limited Chapter 12 Quiz 12-20a When a business segments markets on the basis of personality characteristics,  motives, and life styles, that segmentation is based on a demographics b geographic factors c psychographics d behaviouristic characteristics The act of giving up one thing in return for something else is a marketing b utility c an exchange d promotion     © 2003 McGraw­Hill Ryerson Limited Chapter 12 Quiz 12-20b The psychological factor described as “changes in a person’s  behaviour based on” is termed: a perception b motivation c personality d learning In developing a marketing mix, what should be the central focus of all  marketing activities? a price b buyer or customer c product d promotion     © 2003 McGraw­Hill Ryerson Limited ... Single Marketing Strategy Total Target Market Concentration Approach Single Marketing Strategy Company Single Target Market Multisegment Approach Company MarketingStrategy1 MarketingStrategy2 â2003McGrawưHillRyersonLimited... Pink Krav Maga Lowriders Bistros Tai Bo Anatomical wrap soles Scalp jewels Manic Street Preachers/Air Ostrich burgers Floating necklaces Backpacks Gray Pilates Motorcycles Clubs Tai Chi Platforms... goods, services, and ideas 1 2-5 A target market is a more specific  group of consumers on whose needs  and wants a company focuses its  marketing efforts     © 2003 McGraw­Hill Ryerson Limited Generational Marketing