01 Fundamentals of Marketing

Question 1

Definition: Marketing

Answer 1

Marketing is a process of creating value for customers and building strong customer relationships in order to capture value from customers in return.

Question 2

Definition: Exchange

Answer 2

An exchange is defined as the transfer of goods between two entities and is at the heart of marketing.

Question 3

Criteria for Exchange (5)

Answer 3

1) Transfer of goods
2) Minimum of 2 Parties
3) Each has sth of value to the other
4) All act voluntarily (nobody is forced to buy or sell)
5) Communication between each other (size M-Marketing, coupons, ads)

Question 4

Elements of Marketing: Marketing Orientations (6)

Answer 4

1) Product Oriented
2) Production Orientation
3) Selling Orientation
4) Marketing Orientation
5) Societal Orientation
4+5) Relationship Marketing

Question 5

Definition: Production Oriented

Answer 5

Quality is not the most important factor, simply produce as much as possible to achieve maximum economies of scale to lower prices.

Question 6

Definition: Product Orientation

Answer 6

Quality is the most important factor, whilst some features are added to the main product without it being mass produced and thus priced higher.

Question 7

Definition: Selling Orientation

Answer 7

Involves taking drastic measures to convince the customer that they have to buy a product, even if they may not necessarily need it.

Question 8

Definition: Marketing Orientation

Answer 8

Due to the fact that customers have become more sophisticated, Marketing Orientation asks the customers what they want, putting their satisfaction at the forefront.

Question 9

Definition: Societal Orientation

Answer 9

This orientation affects society in the process through pollution or smoking. This means that it is not necessarily affecting the customer, however the marketer needs to consider the societal impact, so that his consumers are not using the product in the wrong way.

Question 10

Definition: Needs

Answer 10

States of felt deprivation/Needs are essential to human survival and are classed into physical (food,clothes), social(belonging, affection) and individual needs(knowledge, self-expression).

Question 11

Definition: Wants

Answer 11

Wants describe the products or services that customers desire, but do not necessarily need. They are shaped by culture and individual personality.

Question 12

Definition: Demands

Answer 12

Human wants that are backed by buying power (Needs/Wants/Desires + Money = Demand)

Question 13

Marketing Orientations/Philosophies: Three Dimensions of the Societal Marketing Concept

Answer 13

Society wants human welfare, Consumers want want satisfaction and the Company wants profits.

Question 14

The Four Ps

Answer 14

1) Product
2) Place
3) Price
4) Promotion

Question 15

Traditional Marketing Concept (6)

Answer 15

! Research consumer needs and characteristics

1) make what you can sell instead of trying to sell what you make
2) focus on need that product satisfies (not on product)
3) market products/services that match customers’ needs better than competitor
4) understand purchase behaviour concept and influence on consumer behaviour
5) each consumer transaction is a discrete sale

Question 16

Value-and-Retention/Relationship orientated Marketing Concept (6)

Answer 16

! Research levels of profit associated with consumer needs and characteristics

1) use technology that enables customer to customize what you make
2) focus on need that product satisfies AND product’s perceived value
3) use understanding of customer’s needs to develop a product perceived(!) as more valueable than competitor’s
4) understand consumer behaviour in relation to product
5) each customer transaction = part of ongoing relationship with customer

Question 17

Changes in marketing environment/ Factors affecting the environment of Marketing

Answer 17

1) Economic + financial environments (Inflation Rates, Unemployment – changes in buying power)
2) Cultural + social environments (mexican food made part of US culture)
3) Globalization of markets and businesses (growth of emerging markets)
4) Different ethics and social responsibility standards
6) Growth of Non-Profit and other forms of non-traditional marketing (place and idea marketing, marketing also used for non-profit)
7) Impact of rapidly changing Technologies and metrics (changing formats of communication, smartphones, social media)