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Summary Marketing Fundamentals 3rd Edition (chapter 1, 2, 3, 4 and 6)
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Detailed summary of "Marketing Fundamentals" 3rd Edition, chapter 1, 2, 3, 4 and 6.
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Chapter 1: What is marketing?1.1: The meaning of marketing
All activities that bring buyers and sellers together.
1.1.1: Differences between selling and marketing
Companies make products and put them on the market: marketing instead of selling.
Difference: between a society in which consumers can choose from products and services designed
to meet their specific needs and wants, and a society in which people have very little if any choice.
Marketing: anticipate and satisfy the needs and wants of the customer, identifying with customers,
building an ongoing relationship and It is also about building bridges between production and consumption.
“Making sure that what you have on the shelves is what the customer wants.”
Selling: “Trying to get rid of what you have on the shelves.”
1.1.2: A definition of marketing
Supply is precisely tailored to meet demand.
Marketing mix: marketing requiring not only the appropriate product, but also the right type of
distribution, the right price and the right kind of promotion one of these aspects miss, product will not
achieve sales and profit objectives & needs and wants of customers are not met.
Formal Definition: “process of developing, pricing, promoting and distributing products, services or
ideas that are tailored to the market. It includes all other activities that create value and systematically lead
to increased sales or another desired response, establish a good reputation and ongoing relationships with
customers, so that all stakeholders achieve their objectives.”
1.1.3: The marketing mix
4 marketing instruments (4p’s) which are all related based on target market.
1) Product
Goods, services or ideas that meet the needs & wants of the customer. Besides
physical product: brand (packaging), development of new products & services,
refinement of existing products and take products off market when they no longer
satisfy a need.
2) Price
Amount of money exchanged for a product or service. Looking at manufacturing
costs, prices charged by competitors and the effect on demand when increasing or reducing
the price.
3) Place (distribution)
How a company gets its product into buyers’ hands. Distribution sometimes plays
bigger role in determining its success than the product itself. Distribution concerns decisions about
which distribution channels and intermediaries should be used, number of sales outlets, necessary
stock levels and best forms of transportation (physical distribution).
4) Promotion
Supplier’s activities to communicate with the market and to promote sales. Includes
advertising, sponsorship, sales promotion, direct marketing and personal selling and public
relations activities.
4 C’s: customer focused for companies to see themselves through the eyes of the customer.
Product Customer solution: solution for the customer
Price Cost to the customer: value for money
Place Convenience: ease for the customer
Promotio Communication: mutual communication between the organisation and the customer
n
, 1.1.4: Target market selection and the process of exchange
Target market: part of the market than an organisation concentrates on and wants to turn into (loyal)
customers who repeat their purchases.
1) company divides market into market segments on basis of criteria 2) select one/more target markets -
3) bring about an exchange (2 parties agree to exchange something of value so both parties’ needs are
met) with these groups.
Exchange transactions: items of worth, often
products exchanged for money (but also less
tangible’ service, idea, labour or status). F.e.
students getting education in exchange for paying
tuition fee.
process of exchange creates, communicates and
delivers value.
1.3: Development of the marketing mindset
A lot of companies still are
production-oriented/selling-oriented instead of
market-oriented.
1.3.1: Production-and product-oriented companies
Production-oriented (production concept) company: does everything possible to make its production
process highly efficient.
Product oriented (product concept): moving the attention form the production process to the product itself
to improve quality.
Seller’s market: demand exceeds limited supply suppliers/sellers have the upper hand detriment
(schade) of customers.
1.3.2: Selling-oriented companies
Buyer’s market: buyers have a stronger position than the suppliers because supply exceed demand
battle for winning over consumer entrepreneurs focus on selling (selling concept) and use aggressive
techniques to dispose products.
1.3.3: Marketing-oriented companies
More buying power companies have to tailor products & services to meet needs and wants of buyers
effectively managers adopt a customer-oriented mode & put marketing concept into practice, starting
with a market-oriented approach.
Market orientation: companies which not only consider customers, but also intermediaries and
competitors in making business decisions at all levels of
the organisation.
Differences in stages between product & selling
orientation and market-orientation.
Identify customer needs target market.
Difference: marketing (integrated plan) the product rather
than selling (1 component of marketing) the product.
, 5 components marketing plan: product, distribution, communication,
pricing strategy and selling.
Societal marketing concept (socially responsible marketing): Production &
marketing of certain products may have damaging consequences in the
long term effort must be made to prevent harming the interests of
buyers and nonbuyers (Greenpeace) marketers should balance the
interests of the consumer, the producer and society.
When developing a societal marketing-oriented strategy, firms with a sense of responsibility consider the
impact of marketing activities on various groups within society (children, environmental, activists).
Opinions of several people on social media influence decision making process consumers expect
organisations to serve interests of society (not just their own) social-marketing approach: marketing 4.0
(responding to increased interactivity inside & towards market, increasing social relationships on
purchasing decisions).
1.3.4: Relationship marketing
Relationship marketing: goes beyond creating relationship of
exchange process; developing long-term relationships with
customers and suppliers who add value to the collaboration for all
parties involved more strategic alliances.
Relationship-marketing needs a well thought-out strategy when it
comes to implementing the marketing concept.
1.4: The marketing concept
Marketing concept: attitude/mindset in which the needs and wants of
customers are factored into virtually every decision (actively supported
by senior management).
Based on 6 principles.
1) Customer satisfaction
“Customer is always right.” Customer-orientation is crucial in decision making developing ongoing
relationships this line of thought should be followed by all individuals in organisation.
Customers satisfaction organisation must make choices, focusing on certain groups of customers may
be customers a company prefers not to have: demarketing.
Customer affairs: customer service handle customer complaints & affairs well (f.e. public relations),
everything an organisation does to maintain good relations with customers.
Customer affair/service department (external face of company one of most
important instruments) should:
Anticipate the needs & wants of customer.
Provide useful information about the products and services.
Assure that the product/service is easy for customers to use.
Determine how satisfied customers are with their purchases.
Maintain contact and develop relationships with buyers.
Deal with companies and solve customer problems in the best
possible way.
2) Integrated approach
Difference product-and marketing-
oriented approach: extent to which
various activities are systematically
integrated into overall marketing
policy.
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