Glossary of terms
\ue000Define marketing and the utility (value) it creates for the customer
\ue000Trace the origin of marketing and explain how it has evolved
\ue000Describe the elements of a marketing strategy
\ue000 Understand the scope of marketing
\ue000 What is marketing?
\ue000Evolution of marketing
\ue000 Marketing framework
\ue000Extending the traditional boundaries of marketing
\ue000Functions of marketing
Production and marketing of goods and services are the essence of economic life in any society. All organizations perform these two basic functions to satisfy their commitments to their stakeholders \u2013 the owners, the customers and the society, at large. They create a benefit that economists call utility which is the want-satisfying power of a good or service. There are four basic kinds of utility \u2013 form, time, place and ownership utility. Form utility is created when the firm converts raw materials and component inputs into finished goods and services. Although marketing provides important inputs that specify consumer preference, the organization\u2019s production function is responsible for the actual creation of form utility. Marketing function creates time, place and ownership utilities. Time and place utility occur when consumers find goods and services available when and where they want to purchase them. Online retailers with 24*7 format emphasize time utility. Vending machines focus on providing place utility for people buying snacks and soft drinks. The transfer of title to goods or services at the time of purchase creates ownership utility.
Conversion of raw
components into finished
goods and services
Availability of goods and services when consumers want them
Availability of goods and
consumers want them
Ability to transfer title to
goods or services from
marketer to buyer
Pizza sales (in
exchange for rupees
or credit card
To survive, all organizations must create utility. Designing and marketing want- satisfying goods, services and ideas is the foundation for the creation of utility. Management guru, Peter F.Drucker emphasized the importance of marketing in his classic book, The Practice of Management as:
\u2018If we want to know what a business is, we have start with its purpose. And its purpose must lie outside the business itself. In fact, it must lie in society since a business enterprise is an organ of society. There is one valid definition of business purpose: to create a customer\u2019.
Essentially, \u2018creating\u2019 a customer means identifying needs in the marketplace, finding out which needs the organization can profitably serve and developing an offering to convert potential buyers into customers. Marketing managers are responsible for most of the activities necessary to create the customers the organization wants, These activities include:
\ue000Identifying customer needs
\ue000Designing goods and services that meet those needs
\ue000Communication information about those goods and services to
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