Principles Of Marketing

EITEX Bahirdar university

Seid M
Principles Of Marketing

What Is Marketing?
 What Is Marketing?

Many people think of marketing as only selling and

advertising.
 What Is Marketing?
Today, marketing must be understood not in the old
sense of making a sale—“telling and selling”—but in
the new sense of satisfying customer needs.

The simplest definition: Marketing is managing

profitable customer relationships a set of marketing
tools that work together to satisfy customer needs and
build customer relationships.
 What Is Marketing?
In a narrower business context, marketing
involves building profitable, value-laden
exchange relationships with customers.
Hence, we define marketing as the process
by which companies create value for
customers and build strong customer
relationships in order to capture value from
customers in return.
 The Marketing Process
I. Understanding the Marketplace and Customer Needs

II. Designing a customer-Driven Marketing Strategy

III. Building Customer Relationships

 I. Understanding the Marketplace and Customer Needs

Five core customer and marketplace concepts

1. Needs, wants, and demands;

Human needs are states of felt deprivation.
basic Physical needs for food, clothing, warmth,
safety;
Social needs for belonging and affection;
Individual needs for knowledge and self expression.
Marketers did not create these needs; they are a basic
part of the human makeup.
 I. Understanding the Marketplace and
Customer Needs
Wants are the form human needs take as they are
shaped by culture and individual personality. Wants
are shaped by one’s society and are described in terms
of objects that will satisfy those needs.

When backed by buying power, wants become

demands. Given their wants and resources, people
demand products with benefits that add up to the
most value and satisfaction
 I. Understanding the Marketplace and
Customer Needs
2. Market offerings (products, services, and experiences)
Consumers’ needs and wants are fulfilled through market
offerings—some combination of products, services,
information, or experiences offered to a market to satisfy a
need or a want. Market offerings are not limited to physical
products. They also include services - activities or benefits
offered for sale that are essentially intangible and do not result
in the ownership of anything. Examples include banking,
airline, hotel, tax preparation, and home repair services.
Market offerings also include other entities, such as persons,
places, organizations, information, and ideas.
 I. Understanding the Marketplace and
Customer Needs
3. Value and satisfaction;
Consumers usually face a broad array of
products and services that might satisfy a given
need. How do they choose among these many
market offerings? Customers form expectations
about the value and satisfaction that various
market offerings will deliver and buy
accordingly.

Satisfied customers buy again and tell others

about their good experiences.
 I. Understanding the Marketplace and
Customer Needs
Dissatisfied customers often switch to
competitors and disparage the product to others.

Marketers must be careful to set the right level

of expectations. If they set expectations too low,
they may satisfy those who buy but fail to attract
enough buyers. If they set expectations too high,
buyers will be disappointed. Customer value and
customer satisfaction are key building blocks for
developing and managing customer
relationships.
 I. Understanding the Marketplace and
Customer Needs
4. Exchanges and Relationships
Marketing occurs when people decide to
satisfy needs and wants through exchange
relationships. Exchange is the act of
obtaining a desired object from someone by
offering something in return. In the
broadest sense, the marketer tries to bring
about a response to some market offering.
The response may be more than simply
buying or trading products and services.
 I. Understanding the Marketplace and
Customer Needs
Example
A political candidate, for instance, wants votes,
A church wants membership,
An orchestra wants an audience,
A social action group wants idea acceptance
 I. Understanding the Marketplace and
Customer Needs
5. Markets
The concepts of exchange and
relationships lead to the concept of a
market. A market is the set of actual
and potential buyers of a product or
service. These buyers share a particular
need or want that can be satisfied
through exchange relationships.
 I. Understanding the Marketplace and
Customer Needs

Marketing means managing markets to

bring about profitable customer
relationships. However, creating these
relationships takes work.
 I. Understanding the Marketplace and
Customer Needs
Sellers must search for buyers,
 Identify their needs,
Design good market offerings,
Set prices for them,
Promote them, and
Store and deliver them.
Activities such as consumer research, product
development, communication, distribution, pricing,
and service are core marketing activities.
 II. Designing a customer-Driven Marketing
Strategy

Once it fully understands consumers

and the marketplace, marketing
management can design a customer-
driven marketing strategy.
We define marketing management
as the art and science of choosing
target markets and building profitable
relationships with them.
 II. Designing a customer-Driven
Marketing Strategy
The marketing manager’s aim is to
find, attract, keep, and grow target
customers by creating, delivering, and
communicating superior customer
value.
To design a winning marketing
strategy, the marketing manager must
answer two important questions:
 II. Designing a customer-Driven
Marketing Strategy

The marketing manager’s aim is to find,

attract, keep, and grow target
customers by creating, delivering, and
communicating superior customer
value.
 II. Designing a customer-Driven
Marketing Strategy
To design a winning marketing
strategy, the marketing manager must
answer two important questions:

 What customers will we serve (what’s our target

market)? and
 How can we serve these customers best (what’s our
value proposition)?
 II. Designing a customer-Driven
Marketing Strategy
Choosing a Value Proposition
The set of benefits or values it promises to deliver to
consumers to satisfy their needs.
Example of Value proposition
T-Mobile family and friends can “Stick together.
Infiniti “Makes luxury affordable,”
BMW promises “the ultimate driving machine.
 II. Designing a customer-Driven
Marketing Strategy
Marketing Management Orientations
Marketing management wants to design strategies
that will build profitable relationships with target
consumers.
But
What philosophy should guide these marketing
strategies?
What weight should be given to the interests of
customers, the organization, and society? Very often,
these interests conflict.
 II. Designing a customer-Driven
Marketing Strategy
There are five alternative concepts under which
organizations design and carry out their
marketing strategies 
1. Production concept
2. Product concept “make and sell” philosophy
3. The Selling Concept inside-out perspective
4. The Marketing Concept“ sense and respond”
philosophy, outside-in perspective
5. The Societal Marketing Concept
 II. Designing a customer-Driven
Marketing Strategy
The company’s marketing strategy outlines which
customers it will serve and how it will create value for
these customers.

Next, the marketer develops an integrated marketing

program that will actually deliver the intended value to
target customers.

The marketing program builds customer relationships

by transforming the marketing strategy into action.
 II. Designing a customer-Driven
Marketing Strategy
It consists of the firm’s marketing mix, the set of
marketing tools the firm uses to implement its
marketing strategy
The major marketing mix tools are classified into four
broad groups, called the four Ps of marketing:
 Product
 price,
 place, and
 promotion.
 II. Designing a customer-Driven
Marketing Strategy
To deliver on its value proposition, the firm must first
create a need-satisfying market offering (product).
It must decide how much it will charge for the offering
(price) and
how it will make the offering available to target
consumers (place).
Finally, it must communicate with target customers
about the offering and persuade them of its merits
(promotion).
 II. Designing a customer-Driven
Marketing Strategy

The firm must blend each marketing mix

tool into a comprehensive integrated
marketing program that communicates and
delivers the intended value to chosen
customers.
III. Building Customer Relationships

Customer Relationship Management - is the

overall process of building and maintaining
profitable customer relationships by
delivering superior customer value and
satisfaction.

It deals with all aspects of acquiring, keeping,

and growing customers.