Defining Marketing for the 21st Century

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Global Markets: companies in the global marketplace must decide which countries to enter; how to enter each (as an exporter, licenser, joint venture partner, contract manufacturer or solo manufacturer); how to adapt product and service features to each country; how to price products in different countries; and how to design communications for different cultures. They face different requirements for buying and disposing of property; cultural, language, legal and political difference; and currency fluctuations; yet payoff can be huge.

Nonprofit and Government Markets: companies selling to nonprofit organizations with limited purchasing power such as churches, universities, charitable organizations and government agencies need to price carefully. Lower selling prices affect the features and quality the seller can build into the offering. Much government purchasing calls for bids, and buyers often focus on practical solutions and favor the lowest bid in the absence of extenuating factors.

- Marketplaces, Marketspaces and Metamarkets

Marketplace: physical, such as a store you shop in

Marketspace: digital, as when you shop on the Internet

Metamarket: describes a cluster of complementary products and services closely related in the minds of consumers, but spread across a diverse set of industries and is the result of marketers packaging a system that simplifies carrying out these related product/service activities

Metamediaries: many parts of a metamarket to assist the consumer

- Core Marketing Concepts

- Needs, Wants and Demands

Needs: the basic human requirements, such as for air, food, water, clothing and shelter; humans also have strong needs for recreation, education and entertainment. Marketers do not create needs; needs pre-exist marketers.

Wants: needs become wants when they are directed to specific object that might satisfy the need; i.e. humans NEED food, but they WANT a Philly cheesesteak and an iced tea. Wants are shaped by our society. Marketers influence wants.

Demands: wants for specific products backed by an ability to pay; many people want a Mercedes; only a few are able to buy one. Companies must measure not only how many people want their product, but also how many are willing and able to buy it.

- Five Types of Needs:

- Stated Needs (The customer wants an inexpensive car.)

- Real Needs (The customer wants a car whose operating cost, not initial price is low.)

- Unstated Needs (The customer expects good service from the dealer.)

- Delight Needs (The customer would like the dealer to include an onboard GPS navigation system.)

- Secret Needs (The customer wants friends to see him or her as a savvy consumer.

- Target Markets, Positioning and Segmentation

Target Markets: marketers start by dividing market into segments; identify and profile distinct groups of buyers who might prefer or require product and service by examining demographic, psychographic and behavioral differences; and then marketers decide which present the greatest opportunities

Market Offering: the position that a firm develops to position in the minds of the target buyers of the target markets as delivering some central benefits, i.e. Volvo being safest car on market.

- Offerings and Brands

Value Proposition: companies address customer needs by putting this set of benefits forth in order to satisfy those needs; the intangible value proposition is made physical by an offering, which can be a combination of products, services, information and experiences.

Brand: an offering from a known source, such as McDonald’s; all companies strive to build a brand image with as many strong, favorable and unique brand associations as possible

- Value and Satisfaction

Value: the sum of the tangible and intangible benefits and costs to the consumer; a buyer will chose the offerings she perceives to deliver the most value.

Customer Service Triad: value, a central marketing concept, is primarily a combination of quality, service and price; value perceptions increase with quality and service but decrease with price

Marketing: identification, creation, communication, delivery and monitoring of customer value

Satisfaction: reflects a person’s judgment of a product’s perceived performance in relationship to expectations

- Marketing Channels: used to reach a target market

Communication channels: deliver and receive messages from target buyers and include newspapers, magazines, radio, television, mail, telephone, billboards, posters, fliers, CDs, audiotapes and the Internet. Beyond these, firms communicate through the look of their retail stores and Web sites and other media. Email, blogs and toll-free numbers are also used as monologue channels for ads.

Distribution channels: display, sell or deliver the physical product or services to the buyer or user. These channels may be direct via the Internet, mail or mobile phone or telephone, or indirect with distributors, wholesalers, retailers and agents and intermediaries.

Service channels: to carry out transactions with potential buyers, the marketer also uses service channels that include warehouses, transportation companies, banks and insurance companies.

- Supply Chain

Supply chain: longer channel stretching from raw materials to components to finished products carried to final buyers. Each company captures only a certain percentage of the total value generated by the supply chain’s value delivery system. When a company acquires competitors or expands upstream or downstream, its aim is to capture a higher percentage of supply chain value.

- Competition: includes all the actual and potential rival offerings and substitutes a buyer might even consider

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- Marketing Environment

Task environment: includes the