bài giảng bộ môn Marketing

 Understanding customers and market: - The underlying idea is that if managers understand what current and potential customers’ value, they find it easier to develop products which ensu

Week 3: Marketing

 All organisations face the challenge of understanding what customers want, and ensuring they can meet those expectations Managers of successful firms often attribute their success

to placing marketing at the heart of their strategy

 Understanding customers and market:

- The underlying idea is that if managers understand what current and potential

customers’ value, they find it easier to develop products which ensure customer

satisfaction

 Customers are willing to pay a price that will earn the company a profit (marketing brings value to both parties, and if managers use marketing well, they can increase the value that they offer)

- Needs – Wants – Demands: People have needs (physiological/basic and intangible) that

they try to satisfy Wants are the form which human needs take, as they are shaped by someone’s personality and culture in which they live People have limited resources, so needs and wants only become relevant to a supplier when the person can pay – when a want becomes a demand Given their needs, wants and resources, people demand products and services they believe will satisfy them The more effort an enterprise makes

to understand these, the better it will satisfy them This involves investing in research and development to create an attractive market offering

- The market offer – products, services and experiences: Information about customers’

wants and demands helps companies to develop a market offer Effective marketers look beyond the basic attributes of their products, aiming to create brands which mean something significant for their customers They are then willing to pay a higher price

- Exchanges and transactions: People aim to satisfy needs and wants through exchange

Mutual agreement leads to a transaction in which they exchange this of value at a specified time and place These transactions take place in a market (all the actual and potential customers with similar needs)

 The marketing environment: Marketers spend a lot of time and money identifying trends and

events in the marketing environment that may influence consumer demands

- Macro-environment: Is similar for all those in an industry, and organisations have little

direct influence over it -> PESTEL analysis

- Micro-environment: Each organisation has a unique competitive micro-environment

which has a significant influence on its market -> Porter’s five forces analysis

- Understanding consumer behaviour: A consumer’s decision to buy something reflects internal and external factors Marketers can use these factors to influence consumers to

buy a product

- Marketing information systems: Marketing managers need a marketing information

system It contains internal and external sources of data (micro/macro marketing

environments), and mechanisms to analyse and interpret the data so that marketing staff can use it

 Segments, targets and the market offer:

- Organisations use market segmentation to satisfy the needs of different people within a market Customers are more likely to respond positively to offerings which appeal to the needs of their particular segment of the market, from product design through to

promotion and advertising

- Segmenting depends on identifying variables that distinguish consumers with similar

needs Three major categories which contain many variables: Demography (age, gender, etc.), Geography, and Socioeconomic When segmenting consumer markets, marketers typically use a mix of these variables to provide an accurate profile of distinct groups

- Having segmented a market using these variables, marketers have to decide which to

select as their target market, usually based on the criteria that it: 1 Contains demands

they can satisfy 2 Is large enough to provide a financial return 3 Is likely to grow

 Using the marketing mix:

- Marketing managers select the tools to satisfy the customers in their target market A convenient way to group the factors in the marketing mix is known as the “four Ps”

- Product: Product refers to the range of goods and services which the company offers the

target market The extent to which offerings are tangible or intangible affects how marketing staff deal with them Services present marketing with particular challenges because they are perishable and intangible, heterogeneous and inseparable

- Price: Price is the value placed upon the goods, services and ideas ex hanged between

organisations and consumers In selecting the price that will position a product

competitively within consumers’ minds, the marketing manager must be aware of the image that consumers have of the product

- Promotion: Properly referred to as marketing communications, this element of the mix

tells customers about the merits of the product, and tries to persuade them to buy This

is done through: advertising, sales promotions, personal selling, publicity, websites, online communities, etc

- Place: This refers to how products can best be distributed to the final consumer, either

directly or through intermediaries

 In developing a marketing mix that will place products competitively within the minds of consumers, marketing managers aim for coherence

 The product life cycle:

- In managing the organisation’s product decisions, marketing managers use a concept called the product life cycle

- Development: In many markets companies only survive if they can show a steady stream

of new products, a small proportion of which will be profitable Sometimes they acquire already-developed products from other companies, as a way of quickly filling a perceived gap in their product range Alternatively, they depend on their own R&D to develop new

or improve products This is expensive and means the company is spending large sums with no immediate return

- Introduction: Profits are still negative because sales from the early adopters have not

reached the level needed to pay back investment in R&D The aim of the marketing manager at this stage is to invest in marketing communication and make as many

potential consumers as possible aware of the product’s entry into the marketplace

- Growth: At this stage consumers are aware of the product and have started buying it

Sales rise quickly and profits peak As people buy the product, more consumers become aware of it and the high profit levels attract new competitors into the industry The aim

of the marketing manager at this stage is to fight off existing competitors and new entrants This can be done by encouraging consumer loyalty, distributing the product as widely as is demanded by consumers, and cutting selling prices: production costs fall as total units increase, due to the learning curve effect Competitors arriving later have not had time to cut costs so may baulk at entering the market

- Maturity: With profits peaking during the growth stage, profit and sales start to plateau

and then decline towards the end of this stage By this stage many consumers are aware

of and have bought the product and there are more competitors The marketing

manager may react by reducing the price or differentiating it by, for example altering its packaging and design At this stage product differentiation can successfully reposition products to an earlier stage in their life cycle

- Decline: There is little demand and all competing organisations are considering removing

the product from the marketplace It is important that, by this stage, the marketing manager has a new product ready to enter the marketplace and replace the product that

is being removed Certain rarity products can still generate profits in decline

 Customer relationship management (CRM):

- Many companies choose to focus on what they call CRM, aiming to develop long-term profitable relationships with customers in the hope that this will add more value to both parties By increasing customer satisfaction they hope to build their loyalty to the

product or service, so that they continue to make purchases over many years

- A narrow interpretation of CRM is to gather data on individual customers, and use that

to build customer loyalty

- CRM also has a broader meaning which includes all aspects of building and maintaining close relations with customers by understanding their needs, and delivering superior value to them

 A marketing orientation:

- Four marketing orientations that could be assimilated to an organisation’s culture:

1 Product: in units with a product orientation people focus on the design and perhaps

the perfection of the product itself This could mean focussing on developing highly sophisticated products using the latest scientific developments; or it could mean continuing to deliver a familiar product in a familiar way

2 Production: the aim is to produce large quantities of a limited range of products

efficiently and economically This works well in situations where few goods and services are available, as customers have little choice Companies with a production focus may suffer if conditions change towards greater competition and wide choice

A focus on volume production may make it hard to meet the needs of customers who expect variety and change

3 Sales: units with this orientation aim to turn available products into cash, often using

aggressive sales techniques This may be the only way to sell products which people

do not enjoy buying Companies also use this approach when they must raise cash urgently to meet pressing financial commitments

4 Marketing: the focus is on understanding and satisfying customer needs and

demands This approach is likely to be especially useful when the supply of goods exceeds demand, so that competition is intense

- Marketing orientation: Most commercial organisations have a marketing function (i.e market research, promotion, etc.) A marketing orientation means much more than this,

in that it refers to a situation where the significance of marketing is deeply embedded throughout the organisation This means that staff who are not in direct contact with customers nevertheless understand their needs, and give time and effort to satisfy them

A marketing orientation is hard to achieve, as it depends on the culture encouraging appropriate behaviour in relation to customers, competitors, and co-ordination

Concentrating on the market and being a customer centred organisation enables

managers to discover what consumers want

 Developing a marketing orientation: While a marketing orientation is a desirable goal for companies in volatile markets, such cultural change is hard to achieve All staff need to share a common commitment to work together in the interests

of customers

 Integrating themes:

- Entrepreneurship: entrepreneurial marketing is very different from that in large firms It tends to be much more informal, simple, reactive, opportunistic, etc

- Sustainability: marketing could be seen as a problem and a solution A problem because companies used marketing to promote a greater consumption of goods that have contributed to the current world situation A solution because marketing could be used

to propose changes in people’s lifestyle therefore reaching a sustainable economic system

- Internationalisation: use marketing strategies to become an international company