4.1 (The role of marketing) Flashcards
Why does marketing exist
Marketing exists to address people’s needs and wants. It is about making customers want to buy the products of a prticular busnniness
4 general objectives of marketing (4 p’s)
Ensure that the right (PRODUCTS) are supplied to fulfill needs and wants of customers
Set the correct (PRICE) so that customers can afford to buy the products
Distrubtiubte (or PLACE) the products convientnly for customers to buy the product
Ensure that there is adequaate and effective (PROMOTION) to convince customers to buy the firms products
What is the marketing relationship with other business functions
Operations management: The production department works closely with the marketers in using sales forecast (from market research) to prepare thier production sceduhle
Finance and accounts: The marekting deparmtne works closley with the finance department to set appoprate budgets
HR: Marketing data can help the HR deperatmnet idenfiy staffing needs . Example the introduction of a new proudction might require extra production staff and sales personnel
Marketing Goods Vs marketing Services
Services are unique in 4 ways, intangible, insperablem perishable, variable
Intangibility: While goods are tangible (phyiscal), services are intangible (not physical)
Inserpable 0 The services received is attached too the peopele who delvier the service
Perishable- Services do last but are usally consumed at the time of the purchase
Variable- Each Customer experience is unique
3 extended P’s
People - Refers to people involved in the service
Process - refers to how the process is provided
Physical evidence - refers to visible and tangible aspects of a service, e.g stafff unifomr, lighting, cleannlines of the building
Market orientation
Market orientation is a marketing approach used by businesses that are outward. They focus on making products they can sell, rather than selling products they can make.
Two main advnatges:
Greater flexibility: business can repsond quickly to changes in the market as they have access to relevant data and information about customers.
Lower risk: Market origned business can be more confident that thier products will sell and be more successful
Two disadvantages:
Market research (needed to find what customers want) must be done and can be very expensive.
Due to the rapid changes of markets there is no certaintly of the future and the product may no longer be popular by the time of production.
Product orientation . USP?
is a marketing approach adopted by busineses that are inward looking. They focus on the products that they make, rather than making products that the market wants/needs
Advantages: Quality can be assured as the business has more control over its operations.
Also by being innovative, product orienation can give organizations a compeitive advnatges or a unique selling point (USP)
Disadvantages:
Since the needs of the market ar ignroed, there is a high failure rate of businesses that use this marekting apporac.
Hence the marketing strategy tedns to be high risk, due to the frequent changes in fashion and tastes of consumers.
The money spent on research and delvopment of products without taking consumers into consideration ,often proves costly.
Commerical marketing
Commerical markeitng is the use of marketing strategies to meet the needs and wants of customers in a profitable way.
Commerical marketing is about providing what customers want, when they want it and where they want it.
Social marketing
Social marketing is the use of mainstream marketing methods to acheive teh beenft of social change, such as infomring the public about the dangers of under-age drinking .
Example Commerical marketing might support the tobacco indsutry by arguing that smoking can help people to relax, that it is poeple choice to smoke and tht it creates jobs.
Social marketing focuses on benfits from a different stance, example smoking bans in public area to help reduce air pollution
Main differences between social and commerical marketing
Purpose-The intention of commerical marketing is selling physical goods and intanibale services for a profit . Social marketing aims to influnece or persuade a desired change in social behavuior or attitude
Main users - commerical marketing is used mainly by private sector businesses . WHile social marketing is used mainly by the govrerment and non-goveremnt organizations (NGOs)
Consumer markets vs industrial markets
Markets that cater for indivials (the general public), whilst industrial markets are those who cater for organizations (busineses and governments)
The market, market size, customer base
The market is a place or porcess whereby customers and suppliers trade. A market exists when there is demand for. aparticular product
The “market size” is made up of the total number of potential buyers of a product or service within a given market, and the total revenue that these sales may generate.
Text - Market size is the value of sales in the industry
Customer base is the group of clients to whom a business markets and sells their goods or services.
Market share
Market shar refers to a business portion of the total sale revenue within the total market size, expressed as a percetange
It is measured by expressing the organizations sales revenue as a percentage of the total sales revenue in the indsutrst
Market share = (Firms sales revenue / Industry sales revenue) * 100
Market share is the sales revenue of a business expressed as a percentage of the total market size
Market share
Market shar refers to an organizations annual portion of the total value of sale revenue within a speciic industry. It is measured by expressing the organizations sales revenue as a percentage of the total sales revenue in the indsutrst
Market share = (Firms sales revenue / Industry sales revenue) * 100
Market concentration
Market concentration measures the degree of compeition that exists within by calculting the market share of the largest few firms in the industry
So the more market share those few firms have the less competitive it is
Marketing objectives
Marketing objectives are the specfific marketing goals of an organizations. The marketing objectives for profit could be *Sales revenue, higher market share, delvoping new products
