T1: Fundamental marketing concepts (What is marketed? (People, Places,…
T1: Fundamental marketing concepts
Possible marketing approaches
Modern approach: 1.3 Holistic Marketing Concept - includes:
Requires a good understanding of the target segment as will need to use a number of mediums
Types of media used
Ensuring marketing in all mediums is congruent with no contradictions.
Links all touch points along the supply chain to ensure a consistent service and message
1.2 Relationship Marketing Approach
Takes time to develop trust
Real value is when the customer becomes a promoter/advocate
Business needs to decide how much and where to invest in this type of marketing
Prioritises relationship ee client and business
Four key constituents - ultimately makes up the 'Marketing Network'
Marketing partners (channels, distributors, suppliers, dealers and agencies)
Financial community (shareholders, investors and analysts)
Focuses on customer retention as attracting new customers can cost 5x more than retaining existing ones - uses cross-selling and up-selling to existing customers
Vertical alignment to ensure all levels of the organisation are on the same marketing page
Horizontal alignment to ensure all departments in an organisation are on the same marketing page
All employees must be prepared to answer questions, and know at least as much as the customer on what is being promoted.
Orgs also need to market to their employees so they become strong, knowledgeable advocates from a personal level as well as their professional level.
Financial accountability - broader variety of specific measures to assess the value-add of any marketing efforts.
Social Responsibility Marketing or 'Societal marketing concept'
Consumers are performing a social and ethical 'audit' before making purchasing decisions
As such, organisation must consider this when considering marketing practices
Older marketing concepts
Production concept - readily available cheap produtcs
Selling concept - customer need to be persuaded but runs the risk of pushing customers into buying and then leaving them unsatisfied
Traditional marketing concept - being better than competitors at communicating value
Product concept - quality is the most important aspect
Marketing concept - focused on finding the right product for your customers, not finding the right customers for your product
an organisational function used to create and deliver value to consumers to satisfy their needs and wants, and also manage customer relationships (Kotler p.5)
Core process of marketing is an exchange (or sale) of values between buyer and seller.
Example: $ for $ - not worth the effort because there is no gain, but what is the first $ is a rare collectible, suddenly the exchange gains value.
Marketing is about researching the needs of the customer and then preparing the customer for what you will offer, so they are ready to buy when you make the product available. (p.5)
What is marketed?
Who is involved? (p.8)
Key customer markets
Must consider how to enter different markets
Must adapt to different markets
Particularly how to communicate in different markets
Face well-trained and well-informed buyers
Must demonstrate value-add opportunities through increased revenue or decreased costs
Establish brand name and reliable supply chain
Mass consumer products
Non-profit and governmental market
Need to be very price conscious with these markets
Marketspaces - digital
Metamarkets - the integrated markets across various industries that relate to one type of product, i.e. car example
Marketplaces - physical
Just as production managers are responsible for supply, marketing managers are responsible for demand.
Eight demand states are possible:
Consumers dislike the product and may even pay a price to avoid it.
Consumers may be unaware or uninterested in the product.
Consumers may share a strong need that cannot be satisfied by an existing product.
Consumers begin to buy the product less frequently or not at all.
Consumer purchases vary on a seasonal, monthly, weekly, daily, or even hourly basis.
Consumers are adequately buying all products put into the marketplace.
More consumers would like to buy the product than can be satisfied.
Consumers may be attracted to products that have undesirable social consequences.
In each case, marketers must identify the underlying cause(s) of the demand state and then determine a plan of action to shift the demand to a more desired state.
Core Marketing Concepts
Target market and market segmentation - An organisation cannot target the entire market so instead targets a segment.
Needs > wants > demands
Wants become demands when the consumer has the means to pay
Needs become wants when there is choice
Marketers do not create needs, but the can arouse need consciousness
Five types of needs (p.11)
Value - consumers attach a 'value' based on quality, service and price (QSP) (p.12) - Value increases with quality and service and decreases with price.
Organisations identify the target market, develop a 'market offering' to suit and then positions themselves to supply
'Brand' is an offering from a known source
Satisfaction - a consumers judgement on outcome
The full channel of a product from raw materials to finished products. Each company along a supply chain contributes and captures some of the value of the full supply chain.
When an org acts on mergers/acquisitions, it is trying to get a bigger cut of the supply chain value
Task environment - includes all parties involved in producing, distributing and promoting the offering.
Broader environment - the 6 components of the boarder environment impact on the parties in the task environment.
The Marketing Mix (4Ps) (p.22)
New marketing realities
Consumer buying power
Network information / digital age
Changing 'marketing mix'
Privatisation - with the intent of improved efficiency
Industry convergence - as orgs spread across industries
Disintermediation - like sky v netflix