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Extensive summary Principles of Marketing 18th edition
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This is a summary covering all the chapters and subchapters provided to know by my school (NHL Stenden International Business)
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MarketingChapter 1: Marketing: Creating Customer Value and Engagement........................................................6
Marketing process..............................................................................................................................6
Needs, wants and demands............................................................................................................6
Market offerings-products, services and experiences....................................................................6
Customer value and satisfaction.....................................................................................................6
Exchanges and relationships...........................................................................................................6
Markets..........................................................................................................................................6
The modern marketing system.......................................................................................................6
Customer value-Driven marketing strategy........................................................................................7
Choosing a value proposition.........................................................................................................7
Marketing management orientations.............................................................................................7
Engaging customers and managing customer relationships...............................................................8
Capturing value from customers........................................................................................................8
Strangers.........................................................................................................................................9
Butterflies.......................................................................................................................................9
True friends....................................................................................................................................9
Barnacles........................................................................................................................................9
The digital age....................................................................................................................................9
Social media marketing..................................................................................................................9
Mobile marketing...........................................................................................................................9
Big data and artificial intelligence.................................................................................................10
The growth of not-for-profit marketing............................................................................................10
Rapid globalization...........................................................................................................................10
Sustainable marketing......................................................................................................................10
Summarized: what is marketing?.....................................................................................................10
Chapter 2: Company and marketing strategy.......................................................................................11
Defining the company mission.........................................................................................................11
Setting company objectives and goals..............................................................................................11
Designing the business portfolio.......................................................................................................11
Analysing the current business portfolio......................................................................................11
The Boston Consulting Group approach (BCG growth-share matrix)...........................................12
Developing strategies for growth and downsizing............................................................................12
Partnering with other company departments..................................................................................12
Partnering with others in the marketing system..............................................................................12
, Marketing strategies.........................................................................................................................13
Market segmentation...................................................................................................................13
Market targeting...........................................................................................................................13
Market differentiation..................................................................................................................13
Market positioning.......................................................................................................................13
Marketing mix...................................................................................................................................14
Product.........................................................................................................................................14
Price..............................................................................................................................................14
Place.............................................................................................................................................14
Promotion.....................................................................................................................................14
Marketing management functions...................................................................................................15
Marketing analysis........................................................................................................................15
Marketing planning.......................................................................................................................15
Marketing implementation...........................................................................................................15
Marketing department organization............................................................................................15
Marketing control.........................................................................................................................15
Marketing return on investment......................................................................................................16
Chapter 3: Analysing the marketing environment................................................................................17
The meso environment.....................................................................................................................17
The company................................................................................................................................17
Suppliers.......................................................................................................................................17
Marketing intermediaries.............................................................................................................17
Competitors..................................................................................................................................17
Publics...........................................................................................................................................17
Customers.....................................................................................................................................18
The macro environment...................................................................................................................18
The demographic environment....................................................................................................18
The economic environment..........................................................................................................20
The natural environment..............................................................................................................20
The technological environment....................................................................................................20
The political and social environment............................................................................................20
The cultural environment.............................................................................................................22
Chapter 18: Creating competitive advantage.......................................................................................23
Identifying competitors....................................................................................................................23
Assessing competitors......................................................................................................................23
Determining competitors’ objectives...............................................................................................23
, Identifying competitors’ strategies...............................................................................................23
Assessing competitors’ strengths and weaknesses.......................................................................23
Estimating competitors’ reactions................................................................................................23
Selecting competitors to attack and avoid........................................................................................24
Good and bad competitors...........................................................................................................24
Finding uncontested market spaces.............................................................................................24
Designing a competitive intelligence system....................................................................................24
Online marketing communication: Chapter 14: Engaging consumers and communicating costumer
value.....................................................................................................................................................25
The new marketing communications model....................................................................................25
The need for integrated marketing communication.........................................................................25
A view of the communication process..............................................................................................26
Steps in developing effective marketing communication.................................................................26
Step 1: Identifying the target audience........................................................................................26
Step 2: determining the communication objectives.....................................................................26
Step 3: Designing a message.........................................................................................................27
Step 4: Choosing communication channels and media.................................................................27
Step 5: Selecting the message source and collecting feedback....................................................27
Setting the total promotion budget..................................................................................................28
1. Affordable method...................................................................................................................28
2. Percentage-of-sales method.....................................................................................................28
3. Competitive-parity method......................................................................................................28
4. Objective-and-task method......................................................................................................28
Shaping the overall marketing mix...................................................................................................28
The nature of each promotion tool..............................................................................................28
Promotion mix strategies (push and pull strategy).......................................................................28
Socially responsible marketing communication...............................................................................29
Advertising and sales promotion..................................................................................................29
Personal selling.............................................................................................................................29
Online marketing communication: Chapter 17: Direct, online, social media, and mobile marketing...29
The new direct marketing model......................................................................................................29
Online marketing..............................................................................................................................30
Social media marketing....................................................................................................................30
Advantages and challenges of social media..................................................................................30
Mobile marketing.............................................................................................................................31
Direct-mail marketing.......................................................................................................................31
, Catalog marketing............................................................................................................................31
Telemarketing...................................................................................................................................31
Direct-response television marketing...............................................................................................31
Kiosk marketing................................................................................................................................31
Public policy issues in direct and digital marketing...........................................................................31
Current customer journey (lecture material)....................................................................................32
Chapter 7: Customer value-driven marketing strategy.........................................................................32
Market segmentation.......................................................................................................................33
Geographic segmentation............................................................................................................33
Demographic segmentation.........................................................................................................33
Psychographic segmentation........................................................................................................33
Behavioural segmentation............................................................................................................34
Requirements for effective segmentation....................................................................................34
Market targeting...............................................................................................................................34
Different market targeting levels..................................................................................................35
Market differentiation and positioning.............................................................................................35
Positioning map............................................................................................................................35
Choosing a differentiation and positioning strategy.........................................................................35
1. Identifying a set of differentiating competitive advantages on which to build a position........36
2. Choosing the right competitive advantages..............................................................................36
3. Selecting an overall positioning strategy..................................................................................36
Brand Key Model..................................................................................................................................37
Chapter 8: Products, services and brands.............................................................................................38
Product, services and experiences....................................................................................................38
Levels of product and services..........................................................................................................38
Consumer and industrial products...................................................................................................38
Individual product and service decisions..........................................................................................39
Product quality.............................................................................................................................39
Product features...........................................................................................................................39
Product style and design...............................................................................................................40
Branding.......................................................................................................................................40
Packaging......................................................................................................................................40
Labelling and logos.......................................................................................................................40
Product support services..............................................................................................................40
Product line decisions.......................................................................................................................40
Product mix decisions.......................................................................................................................40
,Chapter 9: Developing new products...................................................................................................41
1. Idea generation.............................................................................................................................41
Internal idea sources....................................................................................................................41
External idea sources....................................................................................................................41
Crowdsourcing..............................................................................................................................41
2. Idea screening...............................................................................................................................41
3. Concept development and testing................................................................................................42
Concept development..................................................................................................................42
Concept testing.............................................................................................................................42
4. Marketing strategy development.................................................................................................42
5. Business analysis...........................................................................................................................42
6. Product development...................................................................................................................42
7. Test marketing..............................................................................................................................42
8. Commercialization........................................................................................................................42
Managing new product development..............................................................................................43
1. Customer-centered new product development.......................................................................43
2. Team-based new product development...................................................................................43
3. Systematic new product development.....................................................................................43
Product Life-Cycle strategies............................................................................................................43
Production decisions and social responsibility.................................................................................44
International product and services marketing..................................................................................44
Chapter 19: The global marketplace.....................................................................................................45
1. Elements of the global marketing environment...........................................................................45
The international trade system.....................................................................................................45
Deciding whether to go global..........................................................................................................46
Deciding which markets to enter......................................................................................................46
Deciding how to enter the market....................................................................................................47
Deciding on the global marketing program......................................................................................47
Pricing...............................................................................................................................................47
Distribution channels........................................................................................................................48
International finance lecture................................................................................................................49
Managing currency risks...................................................................................................................49
International payments....................................................................................................................49
INCO terms.......................................................................................................................................50
,Chapter 1: Marketing: Creating Customer Value and
Engagement
Marketing is engaging customers and managing profitable customer relationships. Marketing is not
just about making a sale. It is about satisfying customer needs.
Marketing process
Needs, wants and demands
The first part of the marketing process is about the needs, wants and demands of the customers. The
needs are basic physical needs for food, clothing, warmth and safety. Wants are the form of needs
people have that are formed through society. When wants are backed by buying power, these wants
become demands.
Market offerings-products, services and experiences
The needs and wants of customers are fulfilled through market offerings. Companies can combine
products, services and information offered to a market to satisfy a want or need. Marketing myopia
is the mistake of paying mor e attention to existing wants and less to underlying customer needs. Big
companies are making use of guest experiences that the customer will remember.
Customer value and satisfaction
Customers attach value to a product. When they are satisfied, they will praise the product to others,
when they are dissatisfied, they will do the exact opposite. Marketeers must be careful which
expectations they set on their products.
Exchanges and relationships
Exchange is the act of obtaining a desired object from someone by offering something in return.
Companies want to build strong relationships by delivering superior customer value.
Markets
A market is the set of all actual and potential buyers of a product or service. The market shares a
particular need or want that can be satisfied through exchange relationships.
The modern marketing system
Nowadays, marketeers also have to bear in mind how their customers influence them and how
customers influence each other. Everything in the modern marketing system has to be in order with
each other.
,Customer value-Driven marketing strategy
When a company fully understands their costumers and their marketplace, they will have to decide
which customers they will serve and how they will bring them value. Marketing management can be
defined as the science of choosing target markets and building profitable relationships with them.
First, the company has to decide whom they will serve. They will perform market segmentation.
Then, they will select which segments they will go after (target marketing). The goal is to find only
customers that the company can serve well and profitably.
Choosing a value proposition
A company also has to decide how it will differentiate from the rest and how it will position itself. The
value proposition of a brand is the set of benefits or values it promises to deliver to customers to
satisfy their needs.
Marketing management orientations
There are five concepts under which organisations design and carry out their marketing strategies:
The production concept
This concept holds that consumers will prefer products that are available and highly affordable. The
organization should focus on improving production and distribution efficiency. This concept can
however, lead to marketing myopia.
The product concept
This concept holds that customers will prefer products that offer the most quality, performance and
features. Therefore, the organization should devote its energy to making continuous product
improvements. Pitfalls are that customers might look for a different solution to satisfy their needs.
The selling concept
This concept holds the idea that customers will not buy enough of the company’s products unless the
firm undertakes a large-scale selling and promotion effort. The aim often is to sell what the company
makes rather than to make what the market wants.
The marketing concept
This concept holds the idea in which achieving organizational goals depends on knowing the needs
and wants of target markets and delivering the desired satisfactions better than competitors do. The
job here is to find the right products for your customers.
The societal marketing concept
This concepts holds the idea that they should look at customers wants on the long term, but also
societal needs on the long term, such as the depletion of natural resources and the wellbeing of their
employees. These companies want to be seen as a good company that cares about the environment.
,Engaging customers and managing customer relationships
The most important step of modern marketing is customer relationship management. This is
building and maintaining profitable customer relationships by delivering superior customer value and
satisfaction. Account management!!!!!!
Key to building customer relationships is building superior value. Customer-perceived value is the
value a customer attaches to a product.
Customer satisfaction is related to a product’s perceived performance relative to a customer’s
expectations.
The new way of marketing is customer-engagement marketing. This form of marketing direct and
continuous customer involvement in shaping experiences, conversations and communities.
Customer brand advocacy is when satisfied customers initiate favourable interactions with others
about a brand.
Customer-generated marketing is marketing which involves a lot from the customers. Asking
customers for new ideas for example.
Partner relationship management is working closely with partners in other departments of the
company and also outside of the company to bring greater value to customers together.
Capturing value from customers
Creating customer loyalty and retention is a good thing. Keeping old customers is cheaper than
gaining new ones. The customer lifetime value can add up a lot. This is all the things a customer buys
over a lifetime.
Share of customer is also very important. This is the portion of money a customer has and gives to
the company it buys something from.
Customer equity is the combined customer lifetime value of every customer of the company.
,To find out which customers a company should maintain a good relationship with can be done with
customer relationship groups.
Strangers
Strangers have a low loyalty and low profitability. Strategy is invest nothing, make money on every
transaction
Butterflies
Butterflies have a high profitability but low loyalty. They will eventually leave but are profitable.
Create satisfying and profitable transactions and capture as much business as possible in the short
time they buy from your company.
True friends
True friends are both profitable and loyal. A company should do their best to keep these customers
at their company. Should turn into true believers that come back regularly and tell others about their
good experiences.
Barnacles
High loyalty, low profitability.
The digital age
We are in the age of the Internet of Things (IoT). This is a global environment where everything and
everyone is digitally connected to each other. Digital and social media marketing is using digital
marketing tools such as apps, websites, social media, online advertisements to engage customers
anywhere and at any time. Many companies also integrate social and mobile media into their
marketing mix.
Social media marketing
Marketing through social media is the most important thing there is right now. Every big company
has Facebook, Instagram and many more.
Mobile marketing
Fastest growing digital marketing platform. Marketers now use mobile channels to stimulate
immediate buying and making shopping easier.
, Big data and artificial intelligence
Big data is for gaining deep customer insights, personalize marketing offers and improving customer
engagements and services. An example of AI is Siri or Alexa.
The growth of not-for-profit marketing
Non-profit organisations also conduct marketing these days. Examples are hospitals, and the military.
They can do this with the cooperation of big corporations, celebrities and public service
announcements.
Rapid globalization
Companies are not just selling more of their locally produced goods in international markets but are
also sourcing more supplies and components abroad and are developing new products for specific
markets around the world. Going global is a much bigger factor these days then it was before.
Sustainable marketing
Corporate ethics and social responsibility are important now. This is all about caring about the
environment and the world around us.
Summarized: what is marketing?
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