Terms to KnowCustomers
⁻ Those who buy products/services
Consumers⁻ Those who use the products/services
Market⁻ potential customers who have the ability and
willingness to buy
Disposable Income⁻ Money left over after taxes
Discretionary Income⁻ money left over after basic necessities
Products/Service⁻ Tangible vs. Intangible
What is Marketing- Process of developing, promoting, and
distributing products to satisfy customer’s needs and wants
- Economics in action
Economics – the study of how scarce limited resources are allocated to satisfy needs and wants
Economics vs. Marketing- Economics ensures everyone has what they
need/want, Marketing gets customers what they need/want
Marketing Functions Distribution• Getting product from producer to consumer
FinanceFinding away for people to afford a product
Market Information ManagementDetermining what people want
PricingDetermine what customers will pay
Product/Service ManagementGiving people what they want
PromotionEnticing customers to buy the product/service
SellingGetting people to buy a product
Marketing Functions Distribution Finance Market Information Management Pricing Product/Service Management Promotion Selling
Marketing Concept1. Satisfy needs and wants2. Do it better than the competition
Competitive Advantage
Utility• Added value1.Form – in a useful form2.Place – available where customers can get
it3.Time – available when customers want it4.Possession – able to take it home5.Information – know about the
product/service
Marketing MixStrategies used to achieve the marketing
concept5 P’s1.Product2.Place3.Price4.Promotion5.People
Product StrategyStrategies applied to the productInclude:Branding (Name)Product MixProduct PositioningProduct Life Cycle
Price StrategySetting a price to achieve an objectiveIncludes:Stage of PLC
Price Skimming/PenetrationPsychological Pricing TechniquesSupply and Demand
Place StrategyHow do customer get the product
What are some different ways customers receive the product?
Channels of Distribution
Channels of Distribution- Path a product takes from producer to
consumerPlayers:1.Producers2.Consumers3.Intermediaries – “middleman”; move
products from producers to consumers
Intermediaries1. Retailers – sell products to consumers2. Wholesalers – buy in large quantities; sell
to retailers3. Agents
- sell to wholesalers or retailers- don’t take physical ownership
Channels of DistributionA B DC
Producer
Consumer
Retailer
Wholesaler
Agent
Retailer Retailer
Wholesaler
Distribution IntensityExclusive Distribution
– 1 outlet in a geographical area
Selective Distribution – limited number of outlets in an area
Intensive Distribution – available in all suitable outlets
Promotion StrategyEnticing customers to buy the productPromotion - Informing, persuading, or
reminding them about a productForms:Sales PromotionSellingAdvertising (Print, TV, Radio, InternetPublic RelationsPublicityGuerilla Marketing Viral Marketing
People StrategySelecting the right group of people for your
product/serviceCreating a Target Market – very specific group
of people the product is aimed atMarket vs. Target Market
Marketing Segmentation – dividing the total market into smaller groups of people who share specific needs and characteristicsDemographic Psychographics Geographics Product Benefits
Personal characteristics that describe a population
May Include:Age
Generation X – 1965-1976, products of dual career households
Generation Y – digital nativesGenderIncome
DisposableDiscretionary
Others?
Demographics
Consumers lifestyle, attitudes, and valuesMay include:
Sports enthusiastsExtremistsConservativesLiberalsOthers
Psychographics
Population that uses product based on benefits
May IncludeSpecialty shoes (ie. Football shoes,
basketball shoes)Diet sodaOthers
Product Benefits