Untitled Lesson

Principles of Marketing

Seventeenth Edition

Chapter 2

Partnering to Build Customer
Engagement, Value, and Relationships

Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.

Principles of Marketing

Seventeenth Edition

Chapter 2

Partnering to Build Customer
Engagement, Value, and Relationships

Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.

Learning Objectives

2.1 List the marketing management functions, including

the elements of a marketing plan

2.2 Discuss the importance of measuring and managing

marketing return on investment.

2.3 Understand what a marketing mix is and give

examples of the elements .

Review

1. What is a marketing strategy?

2. What is a Customer Driven Strategy?

3. Give an example of a successful marketing strategy that has

been used by any business of your choice

4. What is Traget Marketing?

5. What is the primary goal of a marketing strategy?

6. What does the marketing mix include?

7. What is the purpose of product positioning?

8. What is the primary function of advertising in marketing?

Marketing mix

According to Phillip Kotler,
“Marketing mix are the set of marketing tools that firm uses to pursue its marketing objectives
in the target market.”

*These are the key elements involved in planning and marketing a product or service, and
they interact significantly with each other.

Price

*The sale price of the product reflects what consumers are
willing to pay for it.

*The price of a product directly influences sales volume

* Luckin Coffee is affordable and has a number of discounts
and coupons

*The right price drives up the profit for your company.

* Luckin uses Competitive based pricing

Product
* A product is any good or service that fulfills consumer needs or desires.

* Companies can change the packaging to better the product

* Companies can make their product packaging distinct e.g Luckin
coffee has a bright and color

*Luckin Coffee cups are bigger and their takeaway package bags are recycble

Promotion

* Refers to activities that communicate the benefits of the
product and persuade target customers to buy it.

*It includes the advertising and methods used to convince the
customer to buy the product or service.

* Luckin Coffee has apps that are easilly accessible and to use
e.g on platforms like Alipay and Wechat

* Luckin Coffee shops look beautiful hence they attract
customers. Most Luckin coffee shops have bright lights

Luckin Coffee Promotion

Place
*includes company activities that make the product available to target consumers.

*Place involves choosing the place where products are to be made available for sale.

* Luckin Coffee has its coffee shops located at shopping malls, office parks near schools etc.
Most Luckin coffee shops are conveniently located.

Luckin Coffee shops have a unique and nice
look

Luckin Coffee Target Market
* Luckin Coffee's main customers are white-collar workers and
students, and nearly 50% of the customers are concentrated in the
age group of 25- 34 years old

* An effective marketing program blends the marketing mix elements
into an integrated marketing program designed to achieve success

*There is another concern, however, that is valid. It holds that the four Ps concept
takes the seller’s view of the market, not the buyer’s view. From the buyer’s viewpoint,
in this age of customer value and relationships, the four Ps might be better described as
the four As:

Managing The Marketing Effort

* Marketing needs to be managed for it to be a success

*Is a ptocessof planning, executing, and monitoring
strategies to meet customer needs and achieve business
goals

* A marketing manager is responsible for overseeing
these tasks, ensuring that the marketing department
stays on track and delivers results.

Managing Marketing includes the 4 processes

1. Analysis

2. Planning

3. Implementation

4.Control

Market Analysis

* begins with a complete analysis of the company’s situation.

*detailed assessment of your business’s target market and the
competitive landscape within a specific industry.

*This analysis lets you project the success you can expect when you
introduce your brand and its products to consumers within the market.

*The marketer should conduct a SWOT analysis (pronounced “swat”
analysis)

SWOT Analysis

SWOT stands for Strengths, Weaknesses, Opportunities,

and Threats.

* A SWOT analysis is a framework to help assess and
understand the internal and external forces that may

create opportunities or risks for an organization.

1. Strengths

* Areas or characteristics where a company excels and has a competitive advantage over its
peers.

Examples: great corporate culture, strong brand recognition, advanced technology etc

e.g Luckin Coffee’s strength is the integration of mobile technology

Strong brand recognition is a key strength for
Starbucks

2. Weaknesses

* are areas or characteristics where a business is at a
competitive disadvantage relative to its peers.

*Examples include inexperienced management, high
employee turnover,

*Intense competition in the coffee industry

*High prices compared to some competitors

3. Opportunities

* external factors that represent potential growth or improvement areas for a
business

* Examples

*Technological advancements that might help improve efficiency Electronic
vehicles

* Changes in social norms that are creating new markets or new sub-
segments of existing markets. The love for coffee is growing. People want to
stay healthy so a lot of gyms, restaurants that sell salads

*Expanding into new markets

*Adopt Price Differentiation

*Introducing new products

4. Threats

* external forces that represent risks to a business and its ability to operate.

* Examples

* like an industry in decline

* technological innovation that could disrupt the existing business and its
operations

* evolving social norms that make existing product offerings less attractive to a
growing number of consumers.

* Competition from other coffee chains and
independent coffee shops

*Changes in consumer preferences or trends

Points to remember!

* The company should analyze its markets and marketing environment to find
attractive opportunities and identify threats.

* It should analyze company strengths and weaknesses as well as current and
possible marketing actions to determine whichopportunities it can best pursue.

Group work and Presentations

Conduct a SWOT Analysis of any business of your choice

2. Marketing Planning

* The company decides what it wants to do and how it
wants to do it

* A detailed marketing plan is needed for each business,
product, or brand.

*The plan next states major objectives for the brand and
outlines the specifics of a marketing strategy for achieving
them.

Contents of a Marketing Plan:

1. Executive summary 7. Budgets

2. Current marketing situation 8. Control

3. Threats and opportunities
analysis

4. Objectives and issues

5. Marketing strategy

6.Action programs

3. Marketing Implementation

*Turning marketing strategies and plans into
marketing actions to accomplish strategic
marketing objectives.

*Marketing planning addresses the what
and why of marketing activities.

*Marketing implementation addresses
the who, where, when, and how.

Marketing department organization

•Most organizations function by dividing responsibilities

between different departments.

• The marketing department does the companies marketing

activities. e.g Advertising, Promotions etc

•The primary objective of a marketing department is to

identify, attract, engage, and retain customers while
achieving the organization’s sales and growth objectives.

Marketing Control

•Measurement of the company’s marketing performance
in terms of the sales revenue generated, market share
captured, and profit earned.

•If the business isn’t doing well, This may require changing
the action programs or even changing the goals.

Marketing return on investment(marketing ROi)

• The net return from a marketing investment divided by the costs of

the marketing investment.

Learning Objectives

2.1 List the marketing management functions, including

the elements of a marketing plan

2.2 Discuss the importance of measuring and managing

marketing return on investment.

2.3 Understand what a marketing mix is and give

examples of the elements .

Review

1. What is a marketing strategy?

2. What is a Customer Driven Strategy?

3. Give an example of a successful marketing strategy that has

been used by any business of your choice

4. What is Traget Marketing?

5. What is the primary goal of a marketing strategy?

6. What does the marketing mix include?

7. What is the purpose of product positioning?

8. What is the primary function of advertising in marketing?

Marketing mix

According to Phillip Kotler,
“Marketing mix are the set of marketing tools that firm uses to pursue its marketing objectives
in the target market.”

*These are the key elements involved in planning and marketing a product or service, and
they interact significantly with each other.

Price

*The sale price of the product reflects what consumers are
willing to pay for it.

*The price of a product directly influences sales volume

* Luckin Coffee is affordable and has a number of discounts
and coupons

*The right price drives up the profit for your company.

* Luckin uses Competitive based pricing

Product
* A product is any good or service that fulfills consumer needs or desires.

* Companies can change the packaging to better the product

* Companies can make their product packaging distinct e.g Luckin
coffee has a bright and color

*Luckin Coffee cups are bigger and their takeaway package bags are recycble

Promotion

* Refers to activities that communicate the benefits of the
product and persuade target customers to buy it.

*It includes the advertising and methods used to convince the
customer to buy the product or service.

* Luckin Coffee has apps that are easilly accessible and to use
e.g on platforms like Alipay and Wechat

* Luckin Coffee shops look beautiful hence they attract
customers. Most Luckin coffee shops have bright lights

Luckin Coffee Promotion

Place
*includes company activities that make the product available to target consumers.

*Place involves choosing the place where products are to be made available for sale.

* Luckin Coffee has its coffee shops located at shopping malls, office parks near schools etc.
Most Luckin coffee shops are conveniently located.

Luckin Coffee shops have a unique and nice
look

Luckin Coffee Target Market
* Luckin Coffee's main customers are white-collar workers and
students, and nearly 50% of the customers are concentrated in the
age group of 25- 34 years old

* An effective marketing program blends the marketing mix elements
into an integrated marketing program designed to achieve success

*There is another concern, however, that is valid. It holds that the four Ps concept
takes the seller’s view of the market, not the buyer’s view. From the buyer’s viewpoint,
in this age of customer value and relationships, the four Ps might be better described as
the four As:

Managing The Marketing Effort

* Marketing needs to be managed for it to be a success

*Is a ptocessof planning, executing, and monitoring
strategies to meet customer needs and achieve business
goals

* A marketing manager is responsible for overseeing
these tasks, ensuring that the marketing department
stays on track and delivers results.

Managing Marketing includes the 4 processes

1. Analysis

2. Planning

3. Implementation

4.Control

Market Analysis

* begins with a complete analysis of the company’s situation.

*detailed assessment of your business’s target market and the
competitive landscape within a specific industry.

*This analysis lets you project the success you can expect when you
introduce your brand and its products to consumers within the market.

*The marketer should conduct a SWOT analysis (pronounced “swat”
analysis)

SWOT Analysis

SWOT stands for Strengths, Weaknesses, Opportunities,

and Threats.

* A SWOT analysis is a framework to help assess and
understand the internal and external forces that may

create opportunities or risks for an organization.

1. Strengths

* Areas or characteristics where a company excels and has a competitive advantage over its
peers.

Examples: great corporate culture, strong brand recognition, advanced technology etc

e.g Luckin Coffee’s strength is the integration of mobile technology

Strong brand recognition is a key strength for
Starbucks

2. Weaknesses

* are areas or characteristics where a business is at a
competitive disadvantage relative to its peers.

*Examples include inexperienced management, high
employee turnover,

*Intense competition in the coffee industry

*High prices compared to some competitors

3. Opportunities

* external factors that represent potential growth or improvement areas for a
business

* Examples

*Technological advancements that might help improve efficiency Electronic
vehicles

* Changes in social norms that are creating new markets or new sub-
segments of existing markets. The love for coffee is growing. People want to
stay healthy so a lot of gyms, restaurants that sell salads

*Expanding into new markets

*Adopt Price Differentiation

*Introducing new products

4. Threats

* external forces that represent risks to a business and its ability to operate.

* Examples

* like an industry in decline

* technological innovation that could disrupt the existing business and its
operations

* evolving social norms that make existing product offerings less attractive to a
growing number of consumers.

* Competition from other coffee chains and
independent coffee shops

*Changes in consumer preferences or trends

Points to remember!

* The company should analyze its markets and marketing environment to find
attractive opportunities and identify threats.

* It should analyze company strengths and weaknesses as well as current and
possible marketing actions to determine whichopportunities it can best pursue.

Group work and Presentations

Conduct a SWOT Analysis of any business of your choice

2. Marketing Planning

* The company decides what it wants to do and how it
wants to do it

* A detailed marketing plan is needed for each business,
product, or brand.

*The plan next states major objectives for the brand and
outlines the specifics of a marketing strategy for achieving
them.

Contents of a Marketing Plan:

1. Executive summary 7. Budgets

2. Current marketing situation 8. Control

3. Threats and opportunities
analysis

4. Objectives and issues

5. Marketing strategy

6.Action programs

3. Marketing Implementation

*Turning marketing strategies and plans into
marketing actions to accomplish strategic
marketing objectives.

*Marketing planning addresses the what
and why of marketing activities.

*Marketing implementation addresses
the who, where, when, and how.

Marketing department organization

•Most organizations function by dividing responsibilities

between different departments.

• The marketing department does the companies marketing

activities. e.g Advertising, Promotions etc

•The primary objective of a marketing department is to

identify, attract, engage, and retain customers while
achieving the organization’s sales and growth objectives.

Marketing Control

•Measurement of the company’s marketing performance
in terms of the sales revenue generated, market share
captured, and profit earned.

•If the business isn’t doing well, This may require changing
the action programs or even changing the goals.

Marketing return on investment(marketing ROi)

• The net return from a marketing investment divided by the costs of

the marketing investment.