Marketing Midterm Notes.docx - Chapter 1 What is marketing...

Chapter 1
What is marketing?
Utility – want satisfying power of a G&S
4 basic kinds of utility:
1. Form utility – when firm convert RM into F/G & S
2. Time and place utility – when consumers find G&S available when and where they want
to purchase them
3. Ownership utility – transfer of title of G or S at the time of purchase
3 steps approach:
1. Identifying the needs in marketplace
2. Find out which needs the organization can profitably serve
3. Develop G&S to convert potential buyers into consumers
Activities necessary to create the customers the organization wants:
1. Identify consumer needs
2. Design products that meet those needs
3. Communicate innovation about those G&S to prospective buyers
4. Make items available at time and places meet consumers’ needs
5. Price merchandise and services to reflect costs, competition, and consumers’ ability to
buy
6. Provide the necessary service and follow-up to ensure customer satisfaction after
purchase
Marketing – organization function and a set of process for creating, communicating and
delivering value to consumers and for managing consumer’s relationships in ways that benefit
the organization and its stakeholders
Marketing Variables – product, price, promotion and place
Several factors forced marketers and entire nations to extend their economic views to events
outside their own national borders:
1. International agreements being negotiated in attempt to expand trade among nations
2. Grow of electronic commerce and computer technologies is brining isolated countries
into marketplace for buyers and sellers around the globe
3. Interdependence of world’s economies, because no nation produces all the RM and F/G
its citizens need or consumers all its output without exporting to other countries
4 eras in the history of marketing
Exchange process – activity in which two or more parties give something of value to each other
to satisfy perceived needs
1. Production era
a. Before 1925, firms focused on production manufacturers stressed production of
quality products and looked for people to purchase them
b. Reached its peak during early 20 th century

c. Building new product is not guarantee of success, and marketing history is
cluttered with bones of miserable product failures despite major innovations
more than 80% of new products fail
d. Production orientation – business philosophy stressing efficiency in producing a
quality product, with the attitude toward marketing that a good product will sell
itself
2. The sales era
a. 1920s to 1950s
b. Manufacturers increase their emphasis on effective sales forces to find
consumers for their output
c. Firms attempted to match their output to the potential number of consumers
who would want it
d. Sales orientation – belief that consumers will resist purchasing non-essential
G&S, with attitude toward marketing only creative advertising and personal
selling can overcome consumer’s resistance and persuade them to buy
3. The marketing era
a. Shift in focus from products and sales to satisfying consumer needs
b.