Marketing 300 #2

Marketing 300 #2 - Marketing 300 09/12 Why is marketing...

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Marketing 300 09/12 Why is marketing important? - How to manage profitable customer relationships - Marketing Mix: product, pricing, promotion, and place Marketing - How to manage profitable customer relationships through reating and capturing value using the marketing mix - Question: How does the marketing mix affect the profits Profits = Revenue – Costs Revenue = Price * Quantity Sold – Variable Cost – Fixed Costs, P *Q – C * Q, where C is the per unit variable cost Assumption is made that the quantity sold is the same as the quantity producted C = marginal cost Market for a given product - Product A o Current Market size: 8 customers o If customers purchase the product, they derive a certain value (that can be measured in S) from consuming the product o Assume (for now) that we know this value for each of the customers and that every customer will buy the product if the price of the product is equal to or lower than their value. Value- Price must be greater than or equal to 0. o
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Marketing 300 #2 - Marketing 300 09/12 Why is marketing...

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