Marketing is the process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods, and services to create exchanges that satisfy individual and organizational goals. Consumers purchase products that offer the best value (relative comparison of a product's benefits versus its costs). Benefits include not only the functions of the product, but also the emotional satisfactions associated with owning, experiencing, or possessing it. Marketing strategies of leading firms focus on increasing value for customers. Products provide customers with utility-the ability of a product to satisfy a human want or need.
There are four kinds of utility. Those are: time utility (products are at large when customer needs it), place utility (products are available where customer can buy them), ownership utility (ownership of a product is reassigned from seller to customer), and form utility (reverse raw materials into completed products). Marketing may be used for many different kinds of outputs. Products that people buy for their own personal use, - for example, cologne, cold medicine, car-are called consumer goods. Companies that sell products for individual consumption are involved in consumer marketing.
Marketing also applies to industrial goods- products used by companies to produce other products. Businesses that sell products to another manufacturers are involved in industrial marketing. Marketing techniques can also be applied to services-intangible products, such as time, expertise, or an activity that can be purchased. Service marketing has become a major growth area in the United States-insurance companies, airlines, health clinics etc. -all use this application. Marketers have a long-term prospective.
Relationship marketing-strategy that emphasizes lasting relationships with customers and suppliers. In that respect, there are five outside factors that contain company's external environment (outside factors that influence marketing programs by posing opportunities or threats). Those are: political and legal environment (political activities), social and cultural environment (values, beliefs, ideas of society), technological environment (new technologies), economic environment (economic conditions affect spending patterns), and competitive environment (marketers convince buyers that their product is better). Any marketing program positions its products for three types of competition. Those include: substitute products (unlike from those of competitors, but accomplish the same need), brand competition (competitive marketing that appeals to consumer perceptions of similar products), international competition (competitive marketing of domestic products against foreign products). Company's marketing manager plans and implements marketing activities that result in the transfer of products or services from producer to consumer.
The activities climax in the marketing plan- detailed strategy for focusing marketing efforts on consumer needs and wants. Marketing strategy starts when a company identifies a consumer need and develops a product to encounter it. In planning and implementing strategies managers develop the four basic components of the marketing mix-the combination of product, pricing, promotion, and distribution (place) strategies used to market products. Market begins with a product-a good, a service, or an idea designed to fill a consumer need and want. Product differentiation is the creation of a feature or image that makes a product differ from competitors. Pricing is the strategy of selecting the most appropriate price at which to sell a product.
Promotion refers to techniques for communicating information about products and includes advertising. All distribution activities are concerned with getting a product from the producer to the consumer. Marketers know that products cannot be all things to all people. Buyers have different tastes, goals, lifestyles, and so on. Marketers think in terms of target markets- groups of people that have similar wants and needs and that can be expected to show interest in the same products. Target marketing involves market segmentation- dividing a market into customer types or "segments." Segmentation is a strategy for analyzing consumers, not products.
There are four influences on consumer behavior. (1) Geographical variables are geographical units that may be considered in developing a segmentation strategy. (2) Demographic variable describe populations by identifying such traits as age, income, gender, ethic background, marital status, race, religion, and social class. Members of market can also be segmented according to their (3) psycho graphic variables- lifestyles, interests, and attitudes. (4) Behavioral variables refer to the ways in which consumers use a product, the benefits they expect from it, their reasons for purchasing it, and their loyalty to it. Efficient decisions are customer concentrated and based on appropriate, legitimate information about marketplace trends.
An effective tool is marketing research- the study of consumer needs and wants and the ways in which sellers can best meet them. Market research can occur at almost any point in a product's life cycle. There are five steps in performing market research. (1) Study the current situation, what is the need and what is done to meet it. (2) Select a research method. (3) Collect data: secondary data-available as result of previous research, or if this data is not available, then use primary data-new data from new research-must be obtain.
(4) Analyze the data: data is not useful till it is systematized into information. (5) Prepare a report: narrow up the study's findings, discover solutions, and make recommendations. The success of a research study usually depends on the method used. There are four basic techniques of market research: Observation-market research technique that involves watching and recording consumer behavior. Survey- market research technique using a questionnaire that is ether mailed to individuals, or used as the basis of telephone or personal interviews. Focus group- market research technique in which a group of people is gathered, presented with an issue, and asked to discuss it in depth.
Experimentation- market research technique that attempts to compare the responses of the same or similar people under different circumstances. Almost everything that people do are recorded and kept on files. Data warehouse - process of collecting, storing, and retrieving data in electronic files. After collecting data, marketers use data mining- application of electronic technologies for searching, sifting and reorganizing data in order to collect marketing information and target products in the marketplace.
Consumer behavior is the study of the decision process by which people buy and consume products. To understand consumer behavior, marketers pull heavily on such subjects as psychology, and sociology. There are four major influences in consumer behavior: psychological influences (motivations, perceptions, ability to learn, and attitudes), personal influences (lifestyle, personality, economic status), social influences (family, opinion leaders, friends, coworkers, professional associates), cultural influences (culture, subculture, social class). By recognizing which influences are most affective in necessary situations, marketers attempt to explain consumer selections and forecast future purchasing demeanor. Some consumers demonstrate brand loyalty- they regularly purchase products because they are satisfied with their performance. Some students have build a chart demonstrating the influences that lead to consumption: the buying process begins when a consumer recognizes a need, having recognized a need, consumers seek information.
By analyzing the characteristics that implement to a given product, consumers equate products in determining which product best meets their needs. 'Buy' decisions are based on rational motives (involves the logical evaluation of product attributes such as cost, quality, and usefulness), emotional motives (involve nonobjective factors, and include sociability, imitation of others, and aesthetics), or both. Marketers desire customers to be glad and satisfied after the use of products so it is more possible for them to buy a product once more. Organizational or commercial markets fall into three categories: industrial market -organizational market consisting of firms that buy goods that are ether converted into products or used during production, reseller market- organizational market consisting of intermediaries that buy and resell finished goods, institutional market- organizational market consisting of such nongovernmental buyers of goods and services as hospitals, churches, museums, and charities. In distinctly regard, organizational buying demeanor takes little resemblance to consumer buying manners. Dissimilarities include the buyers' purchasing skills and an accent on buyer-seller relationships.
Differences in buyers: organizational buyers are professionals trained in arranging buyer-seller relationships and negotiating purchase terms. They are usually specialists in a line of items and are often experts about the products that they buy. Differences in a buyer-seller relationship: often fleeting one-time interaction, industrial situations often involve ordinary, persisting buyer-seller relationships. When markets settle to go worldwide they must view each element of marketing mix. International products: sometimes only one product will meet the needs of foreign buyers. International pricing: markets must view the higher expenses of shipping and selling products overseas.
International distribution: companies have profited prosper ities by buying businesses already established in foreign markets. International promotion: rather frequently promotional procedures do not come through in different countries. Many of present's biggest companies were yesterday's small businesses. Behind the achievement of many small companies exists an understanding of every component in the marketing mix. Small business products: understanding the customers, and their needs, has gained a lot to many small companies. Small businesses pricing: pricing errors usually result from unsuccessful ness to project operating expenses accurately.
If businesses set prices carefully, there are many gains, and satisfaction. Small business distribution: facility location-ability to attract and retain customers depends partially on the location. Small business promotion: plan for promotional expenses as part of start-up costs. Some hold down costs by applying not as expensive promotional ways-for example: local newspapers.
Other business organizations place themselves and their outputs with combined groups, organizations, and events.