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Marketing Principles - Chapter 1

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Marketing Fundamentals - Chapter 1 - BBA / MBA Course
PPT material Marketing Principles

Your comments are welcome to improve the content.

Dr. Francois Gaucher, DBA, MBA

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Marketing Principles - Chapter 1

  1. 1. Principles of Marketing Chapter I Creating and Capturing Customer Value
  2. 2. Chapter 1- slide 2Francois Gaucher - Principals of Marketing Creating and Capturing Customer Value  What Is Marketing?  Why Study Marketing?  The Marketing Strategy  The Changing Marketing Landscape Topic Outline
  3. 3. Chapter 1- slide 3Francois Gaucher - Principals of Marketing Creating and Capturing Customer Value
  4. 4. Chapter 1- slide 4Francois Gaucher - Principals of Marketing What Is Marketing? Peter Drucker “Marketing is the business as seen from the customer”
  5. 5. Chapter 1- slide 5Francois Gaucher - Principals of Marketing What Is Marketing? • Marketing impact the society as a whole: it has a social dimension • Marketing concerns management: the strategies and tools used to market product and services Role of Marketing
  6. 6. Chapter 1- slide 6Francois Gaucher - Principals of Marketing Principals of Marketing What is Marketing?
  7. 7. Chapter 1- slide 7Francois Gaucher - Principals of Marketing What Is Marketing?
  8. 8. Chapter 1- slide 8Francois Gaucher - Principals of Marketing What Is Marketing? 1836: first paid advertising in a newspaper (in France) 1864: earliest recorded use of the telegraph for mass unsolicited spam 1867: earliest recorded billboard rentals 1880s: early examples of trademarks as branding 1905: the University of Pennsylvania offered a course in "The Marketing of Products" 1922: radio advertising commences 1940s: electronic computers developed
  9. 9. Chapter 1- slide 9Francois Gaucher - Principals of Marketing What Is Marketing?
  10. 10. Chapter 1- slide 10Francois Gaucher - Principals of Marketing What Is Marketing? 1940s: electronic computers developed 1941: first recorded use of television advertising 1950s: systematization of telemarketing 1970s: E-commerce invented 1980s: emergence of relationship marketing 1990s : CRM dominance in promotions and marketing planning 1996: identification of viral marketing
  11. 11. Chapter 1- slide 11Francois Gaucher - Principals of Marketing What Is Marketing? Defining Marketing
  12. 12. Chapter 1- slide 12Francois Gaucher - Principals of Marketing What Is Marketing? Defining Marketing Marketing is more than “telling and selling”
  13. 13. Chapter 1- slide 13Francois Gaucher - Principals of Marketing What Is Marketing? So What is Marketing? The essence of marketing is to understand your customers' needs and develop a plan that surrounds those needs.
  14. 14. Chapter 1- slide 14Francois Gaucher - Principals of Marketing What Is Marketing? Marketing is about making it easy for the customer to say “YES”
  15. 15. Chapter 1- slide 15Francois Gaucher - Principals of Marketing What Is Marketing? Peter Drucker : • “Marketing is the whole business seen from the point of view of its final result, that is from the customer’s point of view” • “The aim of marketing is to know the consumer well enough to develop products that sell themselves.”
  16. 16. Chapter 1- slide 16Francois Gaucher - Principals of Marketing What Is Marketing? More recent definition (Kotler): Marketing is a process by which companies create value for customers and build strong customer relationships to capture value from customers in return.
  17. 17. Chapter 1- slide 17Francois Gaucher - Principals of Marketing What Is Marketing? What is VALUE for the Customer? Defining Marketing > 1 GETS GIVES BENEFITS EFFORTS =VALUE =
  18. 18. Chapter 1- slide 18Francois Gaucher - Principals of Marketing What Is Marketing? What is VALUE captured to Customers?  Market Share (width)  Wallet share (Depth)  Mind share (awareness & image)  Heart share (emotions)  Information  Valuable feedback on products and service  Recommendations  Co-production  Co-innovation  Co-Marketing (story telling)  Etc.
  19. 19. Chapter 1- slide 19Francois Gaucher - Principals of Marketing What Is Marketing? Marketing and Sales are two related and often separated functions in a corporation.
  20. 20. Chapter 1- slide 20Francois Gaucher - Principals of Marketing Principals of Marketing Why Study Marketing?
  21. 21. Chapter 1- slide 21Francois Gaucher - Principals of Marketing Why Study Marketing? Why Study Marketing? 1. Plays an important role in society 2. Vital to business survival, profits and growth 3. Offers career opportunities 4. Affects your life every day
  22. 22. Chapter 1- slide 22Francois Gaucher - Principals of Marketing Why Study Marketing? 1. Plays an important role in society •Chinese population exceeds 1.3 billion, to feed and clothe them… we need the help of marketing •Makes products available at the right time, quantities, location, price for the right customer with convenient packages. •Wealth creation through products innovation •Avoid head to head competition through differentiation •Stimulates the economy, make people buy
  23. 23. Chapter 1- slide 23Francois Gaucher - Principals of Marketing Why Study Marketing? 1. Plays an important role in society •Our world is influenced by the action of marketers. •Ads show us what we should think and how we should act – Influence and create: » Culture (Global consumer culture through advertising) » Lifestyle (e.g. Starbucks)
  24. 24. Chapter 1- slide 24Francois Gaucher - Principals of Marketing Why Study Marketing? 1. Plays an important role in society •Marketing and Culture – Marketing fosters a Popular culture: clothes, music, movies, sports, celebrities, etc. consumed by the mass market – Marketing is present in private and public life: » Cultural events: weddings, death, holidays, birthdays (McDonalds) » Social issues (NGOs, government policies, etc.) » Political issues (election campaigns, etc.) – Marketing affects the way we view the world around us.
  25. 25. Chapter 1- slide 25Francois Gaucher - Principals of Marketing Why Study Marketing? 2. Vital to business survival, profits and growth •Business survives in making profits •Marketing helps reach these profit goals •All business manager must be familiar with marketing to survive in today’s competition
  26. 26. Chapter 1- slide 26Francois Gaucher - Principals of Marketing Why Study Marketing? 3. Offers career opportunities •1/4th to 1/3rd of the entire civilian workforce in the U.S. performs marketing activities – Marketing Research – Advertising – Retail Buying – Distribution Management – Product Management – Product Development – Wholesaling •Fastest route up the corporate ladder
  27. 27. Chapter 1- slide 27Francois Gaucher - Principals of Marketing Why Study Marketing? 4. Affect our life every day •Become a better-informed consumer •Half of every dollar spent by consumers pays for marketing costs (USA)
  28. 28. Chapter 1- slide 28Francois Gaucher - Principals of Marketing Principals of Marketing Marketing Philosophies
  29. 29. Chapter 1- slide 29Francois Gaucher - Principals of Marketing The Marketing Philosophies Production concept Product concept Selling concept Marketing concept Societal concept Marketing Management Orientations
  30. 30. Chapter 1- slide 30Francois Gaucher - Principals of Marketing The Marketing Philosophies Marketing Management Orientations Philosophy Key principles Production Focus on efficiency of internal operations Product Focus on product quality and performance Sales Focus on aggressive techniques for overcoming customer resistance Market Focus on satisfying customer needs and wants Societal Focus on satisfying customer needs and wants while enhancing individual and societal well-being
  31. 31. Chapter 1- slide 31Francois Gaucher - Principals of Marketing The Marketing Philosophies • Production concept focuses on improving production and distribution efficiency • Based on the idea that customer will favor products that are available or highly affordable • Appropriate in the following situations: – Demand exceeds Supply – No competition – Generic products The Production Concept
  32. 32. Chapter 1- slide 32Francois Gaucher - Principals of Marketing The Marketing Philosophies “Any customer can have a car painted any colour that he wants so long as it is black” Henry Ford The Production Concept
  33. 33. Chapter 1- slide 33Francois Gaucher - Principals of Marketing The Marketing Philosophies • Product concept is the idea that consumers will favor products that offer the most quality, performance, and features. • Marketing strategy focus on increasing quality, performances, and features through continuous improvements. • The concept can lead to “Marketing myopia” Product Concept Old saying: “Make a better mousetrap and the world will beat a path to your door.” if you just have a good product, your business will be a success
  34. 34. Chapter 1- slide 34Francois Gaucher - Principals of Marketing The Marketing Philosophies All instruction is but a finger pointing to the moon; and those whose gaze is fixed upon the pointer will never see beyond. The Production Concept
  35. 35. Chapter 1- slide 35Francois Gaucher - Principals of Marketing The Marketing Philosophies • Focuses on stimulating buyers’ interest through selling and promotion efforts. • Based on the idea that people will buy more goods if aggressive sales techniques and promotions are used to overcome customer resistance. Selling Concept China Life
  36. 36. Chapter 1- slide 36Francois Gaucher - Principals of Marketing The Marketing Philosophies • Typically practiced with unsought goods – those that buyers do not normally think of buying, such as insurance or non-profit areas (blood donations, NGOs, political campaigns, etc.) • Low involvement purchase – Detergent as Tide, etc. Selling concept Passengers in a metro station in Shanghai pass by a huge advertisement board of Allianz..
  37. 37. Chapter 1- slide 37Francois Gaucher - Principals of Marketing • Sales depends on consumers decision rather than an aggressive sales force • Therefore, success depends on knowing the needs and wants of the target markets and delivering the desired satisfactions better than competitors do. – Customer focus – Competitor intelligence – Customer relationships Marketing concept The Marketing Philosophies
  38. 38. Chapter 1- slide 38Francois Gaucher - Principals of Marketing The Marketing Philosophies Marketing concept • Instead of product-centered “make and sell” philosophy, the marketing concept is a customer- centered “sense and response” philosophy. • The job is not to find the right customers for your product but to find the right products for your customers. • The selling concept takes an inside-out perspective.
  39. 39. Chapter 1- slide 39Francois Gaucher - Principals of Marketing The Marketing Philosophies Customer-driven strategy companies research current customers deeply to learn about their desires, gather new product and service ideas, and test proposed product improvements. Customer-driving strategy marketing is understanding customer needs even better than customers themselves do and creating products and services that meet existing and latent needs. Marketing Management Orientations
  40. 40. Chapter 1- slide 40Francois Gaucher - Principals of Marketing The Marketing Philosophies Societal Marketing Societal marketing concept holds that marketing strategy should deliver value to customers in a way that maintains or improves both the consumer’s and the society’s well being. Marketing concept considers consumer short run wants, Societal concept includes the consumer long run welfare.
  41. 41. Chapter 1- slide 41Francois Gaucher - Principals of Marketing The Marketing Philosophies Societal Concept
  42. 42. Chapter 1- slide 42Francois Gaucher - Principals of Marketing The Marketing Philosophies Societal Concept
  43. 43. Chapter 1- slide 43Francois Gaucher - Principals of Marketing The Marketing Philosophies Production concept Product concept Selling concept Marketing concept Societal concept Marketing Management Orientations Inside-Out Outside-In
  44. 44. Chapter 1- slide 44Francois Gaucher - Principals of Marketing The Marketing Philosophies Marketing Management Orientations
  45. 45. Chapter 1- slide 45Francois Gaucher - Principals of Marketing What Is Marketing? “Marketing is too important to be left to the marketing department.” David Packard, Hewlett-Packard Everybody within the company should be concerned by Marketing = Customer-centric organization Definition
  46. 46. Chapter 1- slide 46Francois Gaucher - Principals of Marketing Principals of Marketing The Marketing Process
  47. 47. Chapter 1- slide 47Francois Gaucher - Principals of Marketing So, What Is Marketing? Understand the Customer and Marketplace Design a Marketing Strategy Construct the Marketing Plan Build Customer Relationships Capture Value 1 2 3 4 5 Research Marketing Information System Segmenting & Targeting Value Proposition: Differentiating and Positioning Product and Service design Pricing Distribution Promotion: communicate the value proposition Customer Relationship Management Partners Relationship Management Create Satisfied, Loyal customers Increase share of Market and share of Customer The Marketing Process Analyzing the Marketing Environment Create Value Manage Relationships Capture Value
  48. 48. Chapter 1- slide 48Francois Gaucher - Principals of Marketing What Is Marketing? 1. Understand the marketplace and customer needs and wants. 2. Design a customer-driven marketing strategy. 3. Construct a marketing program that delivers superior value. 4. Build profitable relationships and create customer delight. 5. Capture value from customers to create profits and customer equity. In the first four steps, companies work to understand consumers, create customer value, and build strong customer relationships. In the final step, companies reap the rewards of creating superior customer value. By creating value for consumers, they in turn capture value from consumers in the form of sales, profits, and long-term customer equity. The Marketing Process
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Marketing Fundamentals - Chapter 1 - BBA / MBA Course PPT material Marketing Principles Your comments are welcome to improve the content. Dr. Francois Gaucher, DBA, MBA

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