Principles of Marketing

Principles of Marketing free pdf ebook was written by Essi Korhonen on January 10, 2003 consist of 126 page(s). The pdf file is provided by users.tkk.fi and available on pdfpedia since December 30, 2011.

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Principles of Marketing pdf




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Principles of Marketing - page 1
Principles of Marketing Principles of Marketing Kotler & Armstrong: Principles of Marketing, 9th edition 1 / 126
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Principles of Marketing - page 2
Principles of Marketing Table of Contents 1 Marketing in a Changing World.........................................................................................................................5 1.1 Marketing Model – Core concepts............................................................................................................................5 1.2 Marketing management.............................................................................................................................................6 1.3 Marketing concepts...................................................................................................................................................8 1.4 Challenges in the new connected millennium...........................................................................................................9 2 Strategic Planning and the Marketing Process................................................................................................10 2.1 Strategic planning process......................................................................................................................................10 2.2 Marketing process...................................................................................................................................................12 3 The Marketing Environment.............................................................................................................................15 3.1 Overview.................................................................................................................................................................15 3.2 Microenvironment...................................................................................................................................................15 3.3 Macroenvironment..................................................................................................................................................17 3.4 Responding to marketing environment...................................................................................... .............................19 4 Marketing Research and Information Systems................................................................................................20 4.1 General....................................................................................................................................................................20 4.2 Marketing information system (MIS)......................................................................................................................20 4.3 Marketing research process.....................................................................................................................................21 4.4 Other marketing research considerations................................................................................................................24 5 Consumer Markets and Consumer Buyer Behavior.......................................................................................25 5.1 Model of consumer behavior .................................................................................................................................25 5.2 Characteristics affecting consumer behavior.......................................................................................................... 25 5.3 Types of buying decision behavior.........................................................................................................................29 5.4 The buyer decision process.....................................................................................................................................30 5.5 The buyer decision process for new products.........................................................................................................30 5.6 Consumer behavior across international borders....................................................................................................31 6 Business Markets and Business Buyer Behavior.............................................................................................32 6.1 Overview.................................................................................................................................................................32 6.2 Business buyer behavior.........................................................................................................................................33 6.3 Institutional and government markets.....................................................................................................................35 7.1 Overview.................................................................................................................................................................36 7.2 Market Segmentation..............................................................................................................................................37 7.3 Market targeting......................................................................................................................................................39 7.4 Positioning for competitive advantage....................................................................................................................40 7 Market Segmentation, Targeting, and Positioning for Competitive Advantage...........................................36 8 Product and Services Strategy...........................................................................................................................43 8.1 What is a product?..................................................................................................................................................43 8.2 Product classifications.............................................................................................................................................44 8.3 Individual product decisions...................................................................................................................................46 8.4 Product line decisions.............................................................................................................................................49 8.5 Product mix decisions.............................................................................................................................................50 8.6 Services marketing..................................................................................................................................................51 8.7 International product and services marketing............................................................................... ..........................52 9 New-Product Development and Product Life-Cycle Strategies......................................................................53 9.1 New product development strategy.........................................................................................................................53 9.2 Product life-cycle strategies....................................................................................................................................56 10 Pricing Products: Pricing Considerations and Approaches..........................................................................59 10.1 Introduction...........................................................................................................................................................59 10.2 Factors to consider when setting prices........................................................ ........................................................ 59 10.3 General pricing approaches...................................................................................................................................62 11 Pricing Products: Pricing Strategies...............................................................................................................64 2 / 126
Principles of Marketing - page 3
Principles of Marketing 11.1 New-product pricing strategies.............................................................................................................................64 11.2 Product mix pricing strategies...............................................................................................................................64 11.3 Price adjustment strategies....................................................................................................................................65 11.4 Price changes........................................................................................................................................................68 11.5 Public policy and pricing......................................................................................................................................69 12 Distribution Channels and Logistics Management........................................................................................71 12.1 The nature of distribution channels.......................................................................................................................71 12.2 Channel behavior and organization.......................................................................................................................72 12.3 Channel design decisions......................................................................................................................................74 12.4 Channel management decisions............................................................................................................................76 12.5 Public policy and distribution decisions................................................................................... ............................76 12.6 Physical distribution and logistics management...................................................................................................77 13 Retailing and wholesaling.................................................................................................................................80 13.1 Retailing................................................................................................................................................................80 13.2 Retailer marketing decisions.................................................................................................................................83 13.3 The future of retailing...........................................................................................................................................84 13.4 Wholesaling..........................................................................................................................................................85 13.5 Wholesaler marketing decisions............................................................................................ ...............................86 13.6 Trends in wholesaling...........................................................................................................................................87 14 Integrated marketing communications strategy.............................................................................................88 14.1 The marketing communications mix.....................................................................................................................88 14.2 Integrated marketing communications..................................................................................................................88 14.3 A view of the communication process..................................................................................................................89 14.4 Steps in developing effective communication.......................................................................................................90 14.5 Setting the total promotion budget and mix..........................................................................................................93 14.6 Socially responsible marketing communication....................................................................................................95 15.1 Advertising............................................................................................................................................................96 15.2 Sales promotion..................................................................................................................................................100 15.3 Public relations....................................................................................................................................................101 15 Advertising, sales promotions, and public relations......................................................................................96 16 Personal selling and sales management.........................................................................................................103 16.1 Role of personal selling.......................................................................................................................................103 16.2 Managing the sales force.....................................................................................................................................103 16.3 Principles of personal selling..............................................................................................................................105 17 Direct and online marketing: the new marketing model.............................................................................108 17.1 What is direct marketing?...................................................................................................................................108 17.2 Benefits and growth of direct marketing.............................................................................................................108 17.3 Customer databases and direct marketing...........................................................................................................109 17.4 Forms of direct marketing...................................................................................................................................109 17.5 Online marketing and electronic commerce........................................................................................................110 17.6 Integrated direct marketing.................................................................................................................................112 17.7 Public policy and ethical issues in direct marketing........................................................................................... 112 18 Competitive strategies.....................................................................................................................................113 18.1 Customer relationship marketing........................................................................................................................113 18.2 Competitive marketing strategies........................................................................................................................115 18.3 Balancing customer and competitor orientations................................................................................................118 19.1 Global marketing in the twenty-first century............................................................................ ..........................119 19.2 Looking at the global marketing environment.................................................................................................... 119 19.3 Deciding whether to go international..................................................................................................................121 19.4 Deciding which markets to enter.........................................................................................................................121 19.5 Deciding how to enter the market.......................................................................................................................121 19.6 Deciding on the global marketing program.........................................................................................................122 19 The global marketplace..................................................................................................................................119 3 / 126
Principles of Marketing - page 4
Principles of Marketing 19.7 Deciding on the global marketing organization..................................................................................................123 20 Marketing and society: social responsibilities and marketing ethics ..........................................................124 20.1 Social criticisms of marketing.............................................................................................................................124 20.2 Citizen and public actions to regulate marketing................................................................................................124 20.3 Business actions toward socially responsible marketing....................................................................................126 4 / 126
Principles of Marketing - page 5
Principles of Marketing 1 Marketing in a Changing World 1.1 Marketing Model – Core concepts Marketing Five core concepts Needs, wants, demands Products and services Value, satisfaction, quality Exchanges, transactions, relationships Markets Definition of marketing A social and managerial process whereby individuals and groups obtain what they need and want through creating and exchanging products and value with others Simple definition Deliver customer satisfaction at a profit By: (1) attracting new customers by promising superior value, and (2) keep current customers by delivering satisfaction Scope of marketing Book has a broad scoping: R&D, communcation, distribution, pricing, service Also buyers carry on marketing activities – e.g. by searching for goods Main elements of a modern marketing system – value added in steps Suppliers Company (marketer) + competitors Marketing intermediaries End user market Needs, wants, demands Needs States of felt deprivation, part of human makeup Physical and social needs Wants The form needs take (e.g. food => hamburger) Shaped by culture and personality Demands When wants are backed by buying power Products and services Products Anything that can be offered to satisfy a need or a want Physical products, services, experiences, persons, places, organizations, information, ideas Example: “smoking is bad” idea can be a product, a person can be a product in an election Aka: satisfier, resource, marketing offer Services Just one kind of a product 5 / 126
Principles of Marketing - page 6
Principles of Marketing Value, satisfaction, quality (Customer) Value Difference between “value gained by owning and using a product” and “cost of obtaining the product” Value gained not necessarily monetary Similarly cost of obtaining not necessarily monetary Customers act on perceived value [and perceived cost] (Customer) Satisfaction Perceived performance relative to expectations Quality Closely related to satisfaction Narrow definition: no defects Broad definition: ability to satisfy customer needs [circular definition!] Exchange, transactions, relationships Exchange Obtaining a desired object from someone by offering something in return Offerings could be money, product, service, ... Transaction A trade of values between two parties; marketing's unit of measurement! Monetary transactions and barter transactions Relationship (Marketing) Going beyong short term transactions Long-term relationships with valued customers, partners, etc Marketing network – company and all its supporting stakeholders Markets Market – Economist's definition Place (virtual or physical) where buyers and sellers meet Market – Marketer's definition The set of actual and potential buyers of a product The sellers of a product are labeled as the “industry” Industry – Marketer's definition The sellers of a product 1.2 Marketing management What is marketing management Book definition Analysis, planning, implementation, and control of programs designed to ... create, build, and maintain beneficial exchanges with target buyers ... for the purpose of achieving organizational objectives = Finding and increasing (sometimes decreasing) demand = Demand management Demarketing To shift or reduce demand, not destroy it 6 / 126
Principles of Marketing - page 7
Principles of Marketing Profitable customer relationships Two categories of demand New customers Repeat customers Traditional focus – attract new customer, transactions Modern focus – retain profitable customers, build lasting relationships Customer lifetime value of a Taco Bell customer > $12,000 ! Practice Three stages Entrepreneurial marketing Individuals who live by their wits, knock on doors etc Marketing department, adopt tools of marketing Maturing company Need internal entrepreneurship to avoid stagnation Get out of office, go into customer's lives, etc Formulated marketing Intrepreneurial marketing 7 / 126
Principles of Marketing - page 8
Principles of Marketing 1.3 Marketing concepts Production concept Customer Favor products that are available and affordable Goal Improve production and distribution efficiency Usefulness Demand exceeds supply Product cost is too high, pressure to decrease Risk - [What to do when situation changes?] Product concept Consumer Favor products with best quality, performance, innovative features Goal Improve product features in a continuous fashion Userfulness [If market is stable, no competing technologies in sight] Risk Competing technology (spray instead of mouse trap) enters market Selling concept Consumer Will not buy enough products unless seller(s) undertake large-scale promotion and selling effort Goal Promote product, coax people into buying Usefulness Unsought goods – encyclopedias, insurance, ... Risk Dissatisfied customers – will not buy again, will tell 10 people! “Inside out” Marketing concept Customer Buys product that best satisfies needs and wants Goal Determine needs and wants of target markets Deliver the desired satisfaction more effectively and efficiently than competitors Risk Short term focus w.r.t. larger social and ethical issues Overlooks long term customer welfare (fast food) Customer driven marketing When customers know what they want Customer driving marketing When customers do not yet know they even need something Meeting existing latent and future needs by understanding customers better than they understand themselves GSM networks, CD players, ... “Outside in” 8 / 126
Principles of Marketing - page 9
Principles of Marketing Social marketing concept Goal Balance (1) Consumer satisfaction in short and long term, (2) society, (3) company profits 1.4 Challenges in the new connected millennium Connections Connecting technologies Computer, Information Communication, Transportation ... which connect Customers More selective, more direct [salad bowl customer base] Connecting for life Other departments, supplies and distributors Strategic alliances Global, broadened connections Values and responsibilities Marketing Partners World around us Supply chain management = Connecting with partners Supply chain = raw materials to components to final products to final buyers SCM = strengthening and optimizing the chain Streamline logistics Reduce joint distribution costs ... Marketing alliance (joint marketing) Product or service alliance (carry / license other product) Promotional alliance (join in a promotion) Pricing alliance (join forces for mutual discounts) Strategic alliences 1) 2) 3) 4) 9 / 126
Principles of Marketing - page 10
Principles of Marketing 2 Strategic Planning and the Marketing Process 2.1 Strategic planning process Strategic planning process Define the company's mission (mission statement) Mission statement = statement of purpose, what do we want to accomplish Requirements Market oriented (in terms of satisfying customer needs) Realistic (not too narrow or broad) Specific Fit the market environment Base on distinctive competences Motivating Set company objectives and goals Mission turned into detailed supporting objectives and goals for each level of company management For instance Spend 15% of profits into R&D to achieve X Sell more or reduce costs to cover costs = marketing goal Through more salespeople or more advertisting, etc. “Increase market share by 20% by end of third year” Broad marketing strategies to cover (broad) marketing goals 10 / 126
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