LESSON 1

WHAT IS MARKETING

Prepared by:

DINO SORIANO DIZON, MBAc, MRIBM

Marketing Instructor
 I. OBJECTIVES

Upon successful completion of this unit, you will be able to:

● define marketing and explain its function in society;

● explain the 4 Ps of marketing.

II. PRE-TEST

I. Multiple Choice: Encircle the letter of your choice.

1. Which element of the marketing mix includes the distribution of products?
a. Product
b. Price
c. Place
d. Promotion
2. To be ethically effective, marketing plans must be
a. honest and truthful
b. flexible enough to contain differences of opinion
c. varied according to management responsibility level
d. substantially different from compliance requirements
3. A(n) __________is a document that communicates a marketing strategy for an
offering.
a. research paper
b. market plan
c. mission statement
d. annual report
4. _________________ are especially useful to marketers.
a. Age, income, gender
 b. Location, locomotion, liberation
c. Profitability, reliability, predictability
d. Proactivity, reactivity, alacrity
5. What type of segmentation is the primary starting point for most marketers?
a. Psychographic
b. Use-pattern
c. Demographic
d. Cultural
6. What is a useful way to empower customers?
a. Ask customers to participate in product design.
b. Conduct customer feasibility studies.
c. Refer customers to competitors for quality comparisons.
d. Give customers free products.
7. Which of the following is a key function of “positioning” in marketing campaigns?
a. To provide a reason why the customer should buy the product.
b. To divert the customer's attention from the product’s flaws.
c. To override the customer’s previous mindset.
d. To distract the customer from considering a competitor’s product.
8.What is the generally accepted view about using sex and humor themes in cross-cultural
marketing campaigns?
a. Humor and sex themes are acceptable.
b. Humor and sex themes are encouraged.
 c. Humor and sex themes can be used if they are very mild.
d. Humor and sex themes are not appropriate.
9. Today’s successful companies at all levels have one thing in common. The common
theme can best be described as one where the companies are:
a. oriented around public service.
b. strongly customer focused and heavily committed to marketing.
c. moving toward globalization and socialization.
d. more interested in governmental regulation and control than ever before.
10. Creating __________________ is at the very heart of modern marketing thinking
and practice.
a. profit maximization
b. increased stock value
c. award winning products
d. customer value and satisfaction

III. LESSON PROPER

IV.

What Is Marketing?
What makes a business idea work? Does it only take money? Why are some
products a huge success and similar products a dismal failure? How was Apple, a computer
company, able to create and launch the wildly successful iPod, yet Microsoft’s first foray
into MP3 players was a total disaster? If the size of the company and the money behind a
product’s launch were the difference, Microsoft would have won. But for Microsoft to have
won, it would have needed something it’s not had in a while—good marketing so it can
produce and sell products that consumers want.

So how does good marketing get done?

Defining Marketing

Marketing is defined by the American Marketing Association as “the activity, set of

institutions, and processes for creating, communicating, delivering, and exchanging
offerings that have value for customers, clients, partners, and society at large.”American
Marketing Association, “Definition of Marketing,”

1. Creating. The process of collaborating with suppliers and customers to create

offerings that have value.
 2. Communicating. Broadly, describing those offerings, as well as learning from
customers.
3. Delivering. Getting those offerings to the consumer in a way that optimizes value.
4. Exchanging. Trading value for those offerings.

The traditional way of viewing the components of marketing is via the four Ps:

1. Product. Goods and services (creating offerings).

2. Promotion. Communication.
3. Place. Getting the product to a point at which the customer can purchase it
(delivering).
4. Price. The monetary amount charged for the product (exchanging).

Product Promotion Place Price

1. Is there a 1. Making 1. Distribution is 1. How much are

demand for the customers aware getting the right customers
product or of a product product to the willing to pay?
service? 2. Advertising right place at the 2. Is the price
2. How to make 3. Coupons right time in the competitive with
the product 4. Rebates right amount and other products?
appeal to 5. Sales in the right 3. Can the
consumer 6. Free give aways condition company make
3. Packaging— 7. Publicity 2. Storage a profit?
includes the 3. Warehousing
design, color, 4. Transporting
size, and brand
names
An example of the 4P's marketing mix, as applied to the iPhone6, is illustrated below:
TRY THIS!
List and define the 4 P’s of Marketing in your own words using the Graphic Organizer below.

Value

Value is at the center of everything marketing does (Figure 1.1). What does value mean?

Figure 1.1

Marketing is composed of four activities centered on customer value: creating,

communicating, delivering, and exchanging value.

When we use the term value, we mean the benefits buyers receive that meet their
needs. In other words, value is what the customer gets by purchasing and consuming a
company’s offering. So, although the offering is created by the company, the value is
determined by the customer.
Furthermore, our goal as marketers is to create a profitable exchange for
consumers. By profitable, we mean that the consumer’s personal value equation is positive.
The personal value equation is
value = benefits received – [price + hassle]
Hassle is the time and effort the consumer puts into the shopping process. The
equation is a personal one because how each consumer judges the benefits of a product will
vary, as will the time and effort he or she puts into shopping. Value, then, varies for each
consumer.
Creating Offerings That Have Value
Marketing creates those goods and services that the company offers at a price to its
customers or clients. That entire bundle consisting of the tangible good, the intangible
service, and the price is the company’s offering
When you compare one car to another, for example, you can evaluate each of these
dimensions—the tangible, the intangible, and the price—separately. However, you can’t
buy one manufacturer’s car, another manufacturer’s service, and a third manufacturer’s
price when you actually make a choice. Together, the three make up a single firm’s offer.
Communicating Offerings
Communicating is a broad term in marketing that means describing the offering
and its value to your potential and current customers, as well as learning from customers
what it is they want and like. Sometimes communicating means educating potential
customers about the value of an offering, and sometimes it means simply making customers
aware of where they can find a product.
Figure 1.2

A BMW X5 costs much more than a Honda CRV, but why is it worth more? What makes up
the complete offering that creates such value?
Source: Wikimedia Commons.
Figure 1.3
Social media sites like Foursquare and Facebook have a location feature that allows
consumers to post their location. Retailers can then use this to send coupons and other special
offers to the consumer’s phone or pad for immediate use.
Source: Flickr.

KEY TAKEAWAY

The focus of marketing has changed from emphasizing the product, price, place, and
promotion mix to one that emphasizes creating, communicating, delivering, and
exchanging value. Value is a function of the benefits an individual receives and
consists of the price the consumer paid and the time and effort the person expended
making the purchase.

DO THIS!
1. 11. Wal-Mart has become the world’s largest retailer by delivering on its promise,
“Always low prices—always.” This would be an example of the marketing
philosophy that says:

a. “Take care of your customers, and market share and profits will follow.”
b. “Buy cheap, sell cheap.”
c. “Always take discounts and pass some of them on to consumers.”
d. “Distribution is the secret to all conquests in marketing.”

2 12. Today, marketing must be understood in a new sense that can be characterized as:
a. “telling and selling.”
b. “management of youth demand.”
c. “get there first with the most.”
d. “satisfying customer needs.”
13. The most basic concept underlying marketing is that of:
a. products and services.
b. human needs.
c. barter.
d. transactions.
14. In outstanding companies, people at all levels, including top management,:
a. work more than eight hours a day.
b. are constantly inventing new products.
c. are addicted to time management.
 d. stay close to customers.
15. Over time, marketing management has offered five distinct concepts under which
organizations conduct their marketing activities. Which of the following DOES NOT belong
on the correct list of these concepts?

a. econometric concept
b. production concept
c. product concept
d. marketing concept
16. The _______________ holds that consumers will favor products that are available and
highly affordable (therefore, management should work on improving production and
distribution efficiency).

a. product concept
b. production concept
c. production cost expansion concept
d. marketing concept
17. The _________________ holds that consumers will favor products that offer the
most quality, performance, and innovative features. Thus, an organization should devote
energy to making continuous product improvements.

a. marketing concept
b. production concept
c. selling concept
d. product concept
18. Which philosophy of business is typically practiced when marketing unsought
goods?

a. the marketing concept

b. the product concept
c. the production concept
d. the selling concept
19. When faced with overcapacity, most firms practice _________________.
a. the marketing concept
b. the product concept.
c. the production concept
d. the selling concept
120. _______________________ holds that achieving organizational goals depends on
determining the needs and wants of target markets and delivering the desired
satisfactions more effectively and efficiently than competitors do.

a. The marketing concept

 b. The product concept
c. The selling concept
d. The societal marketing concept

II. Choose at least12 from the following tasks.

Grab something in your bag( e.g. pen, paper, notebook etc.) and apply the 4 P’s of
Marketing Mix using the diagram below. ( See example on Iphone 6 for your reference.)

2.
III. ESSAY. Choose at least 3 questions. 10 points each.

1. Think of a company or social campaign that has caught your attention and assess
it by using the 4 Ps of marketing (product, place, price, and promotion). Pick a
product, service, or issue for which you might develop a marketing campaign.
What are the first issues you need to address according to the fundamental rules of
marketing?
2. One of your friends is contemplating opening a coffee shop near your college
campus. She seeks your advice about size of the prospective customer base
and how to market the business according to the four Ps. What strategies can
you share with your friend to assist in launching the business?
3. Think about the last time you ate at McDonald’s. Evaluate your experience
using the personal value equation.
4. Compare and contrast a four Ps approach to marketing versus the value
approach (creating, communicating, and delivering value). What would you
expect to be the same and what would you expect to be different between two
companies that apply one or the other approach?
5. Assume you are about to graduate. How would you apply marketing
principles to your job search? In what ways would you be able to create,
communicate, and deliver value as a potential employee, and what would that
value be, exactly? How would you prove that you can deliver that value?
6. Is marketing always appropriate for political candidates? Why or why not?
7. How do the activities of marketing for value fulfill the marketing concept for
the market-oriented organization?
Additional Learning Materials: See Educational Videos sent on Facebook Messenger
Group Chat.
Video 1: Marketing Defined.
Video 2: The Marketing Mix Simplified
Video 3 : Marketing 101, Understanding Marketing Basics, And
Fundamentals

Video 3:

KNOW YOURSELF (SELF-EVALUATION)

1. What did I learn about marketing?
2. What role does marketing play in my day-to-day life?
3. How does value affect my decision in purchasing a product in the market?

Refernces :REFERENCES:

Blythe, J. (2001) Essentials of Marketing, 2nd edition, Prentice Hall

Prof. Dr. Philip Kotler, Prof. Dr. Gary Armstrong and Prof. Dr. Marc Oliver Opresnik
(2020). Marketing: An Introduction
13th Edition
Pearson Education Limited; Auflage: Global Ed of 13th Revised Ed.

Brassington, F and Pettitt, S, (2000), Principles of Marketing, Second Edition, Prentice

Hall, Harlow
Kotler, P, Armstrong, G, Saunders, J and Wong, V, (2001), Principles of Marketing:
Third European Edition, Prentice Hall, Harlow
Kotler,P et al. (2020). Marketing: An Introduction.13th Edition.Pearson Education
Limited; Auflage: Global Ed of 13th Revised Ed.

Randall, G. (2001) Principles of Marketing, 2nd edition, Thomson Learning.