CHAPTER

OBJECTIVESOBJECTIVESNATURE AND SCOPEOF MARKETING

Discuss the importance of marketing and its role in the economy.

List the activities that are a part of marketing.

Define basic marketing concepts and the four elements of the marketing mix.

Explain the four stages of the product life cycle.

ID the consumer goods classifications.

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Marketing Not always easy to match production

and consumption. Producers/consumers need info. to

help them make their decisions Marketing - set of activities that get

products from producers to consumers - but much more than just transporting

Marketing Includes packaging, developing brand

names, determining prices, financing and storing products and promotion and many more Packaging Engineer

ASU Salary

Consumers comes into daily contact with marketing in one form or another

Organizations engaged in marketing Retailers - businesses that sell directly to

final consumers Businesses that sell services rather than

products are also included

Wholesalers - businesses that buy products from businesses and sell them to other businesses

Over 1/3 of all people employed in the US work in a marketing job or a marketing business

NATURE OF MARKETING

Marketing Activities - pg 547 These activities must occur before a product

can be advertised and sold Buying Selling Transporting Storing Financing Researching Risk taking Grading and valuing

NATURE OF MARKETING Cost of Marketing Role of Marketing

Production oriented Sales oriented Customer oriented

A Co. that has adopted the marketing concept will have a marketing manager who is part of top management and is involved in all major decisions--work closely with other people in co. and they strive for customer satisfaction

NATURE OF MARKETING Market Determination--must determine the

market it wants to serve Market=types of buyers a bus. wishes to

attract and where those buyers are located Whom to serve - demographics Where to serve - geographic Identifying target markets - groups of

customers w/ similar needs; do market research to ID market before products are even developed

Elements of Marketing – 4 Ps Product - pg 552 Price - pg 553--not the easiest to

determine Distribution (Place) - pg 554 Promotion - pg 555

Advertising Personal selling

Marketing Mix - blend of all decisions related to product, price, place, promotion

MARKETING PLAN Marketing Plan — detailed written description of all marketing activities that a business must accomplish and coordinate in order to sell its products

Describes goals, target markets, marketing mixes and identifies the ways in which the business will evaluate if the activities were successful and if the goals were accomplished

Written for a one year period

PRODUCT LIFE CYCLE Four stages of sales and profit performance through which ALL brands of a product progress:Introduction

Brand new product enters the market; no competition; low profits at this time due to high costs or production and marketing a new product; counting on future sales

Growth When several brands of a new product are

available, life cycle changes to growth stage; each company tries to attract customers to it specific brand; usually make a profit at this stage

PRODUCT LIFE CYCLE Maturity

Product has been purchased by large numbers; quite profitable; many competing brands; loyalty develops at this stage; promotion of brand name, packaging, image, promotion and price are often emphasized at this stage; profits begin to fall at the end of the maturity stage; reintroduce old products

Decline Occurs when a new product is introduced

that is much better or easier to use; customers begin to switch; may find new uses for old products

Sales

Profits

$

Introduction Growth Maturity Decline

PRODUCT LIFE CYCLE

CONSUMER PRODUCTS Industrial goods

Products designed to be used by another business or incorporated into products: aluminum, bricks, steel; bought in large quantities

Consumer goods Products designed for personal or home

use; bought in small quanitites Convenience goods Shopping goods Specialty goods Unsought goods

Consumer Goods Convenience goods

Inexpensive items; bought w/o much thought: groceries

Shopping goods Purchased less frequently than

convenience goods, higher price, require some buying thought; comparable shopping

Specialty goods Products customers insist on having and

are willing to search for them

Consumer Goods Unsought goods

Customers do not shop for these; no strong desire to have them; present a difficult marketing problem.

Consumer Goods Unsought goods

Ex: life insurance, encyclopedias, funeral services

Usually have to go to the customer and use personal selling to discuss the need for the product