MARKETING

MANAGEMENT
KOTLER AND KELLER
THE ARAB WORLD EDITION
Course Structure

Pricing
Marketing Segmentation
Research

Distribution
Channels
Defining Strategic Targeting
Marketing Planning
Product
Strategies

Positioning
Marketing
Communications
DEFINING MARKETING FOR
THE NEW REALITIES
Chapter 1
Defining Marketing for the new
realities
What Is Marketing?
!  A social definition shows the
role marketing plays in society.
!  Marketing is a societal process
by which individuals and groups
obtain what they need and want
through creating, offering, and
freely exchanging products and
services of value with others.
The Importance of Marketing
!  Marketing’s broader importance extends to society as a whole:
!  Marketing has helped introduce and gain acceptance of new products
that have eased or enriched people’s lives.
!  Successful marketing builds demand for products and services, which, in
turn, creates jobs.
!  By contributing to the bottom line, successful marketing also allows firms
to more fully engage in socially responsible activities.
What is the aim of marketing?
The aim of marketing is to know
and understand the customer so
well that the product or service
fits him and sells itself.
Ideally, marketing should result in
a customer who is ready to buy.
All that should be needed then is
to make the product or service
available.
Peter Drucker
What is Marketed?

Service Places

Property Information

Events Ideas

People Products
The Marketing Process
Markets Defined
!  The term market is used to cover various groupings of
customers.
!  Need markets (the diet-seeking market)
!  Product markets (the shoe market)
!  Demographic markets (the youth market),
!  Geographic markets (the Chinese market)
!  The term market can be extended to cover markets such as:
!  Voter markets
!  Labor markets
!  Donor markets
Core Marketing Concepts

!  Needs, Wants, and

Demands
!  Needs are the basic human
requirements
!  These needs become wants
when they are directed to
specific objects that might
satisfy the need.
!  Demands are wants for
specific products backed by
an ability to pay.
Marketers and Demand
!  Marketers are skilled at
stimulating demand for
their products.
!  They seek to influence
three variables to meet
the organization s
objectives:
1.  Level of demand
2.  Timing of demand
3.  Composition of demand
 Marketers and Demand
Eight demand states are possible:
!  Negative demand Consumers
dislike the product and may even
pay to avoid it.
!  Nonexistent demand Consumers
may be unaware of or
uninterested in the product.
!  Latent demand Consumers may
share a strong need that cannot
be satisfied by an existing
product.
!  Declining demand Consumers
begin to buy the product less
frequently or not at all.
!  Irregular demand Consumer
purchases vary on a seasonal,
monthly, weekly, or daily basis
!  Full demand Consumers are
adequately buying all products
put into the marketplace.
!  Overfull demand More
consumers would like to buy the
product than can be satisfied.
!  Unwholesome demand
Consumers may be attracted to
products that have undesirable
social consequences.
Core Marketing Concepts
!  Market Segmentation
!  Segmentation is
dividing up the market
into distinct groups of
buyers who might
prefer or require
varying product and
service mixes and who
are homogenous
among themselves.
Core Marketing Concepts
!  Market Targeting
!  After
identifying
market segments, the
marketer decides
which present the
greatest opportunities
which are its target
markets.
Core Marketing Concepts
Target Market
Age group
from 14 to
35 M & F

Urban Married &

Singles

Educated

Classes A
and B
Core Marketing Concepts
!  Marketing Offering
!  For each of the chosen
segments, the company
develops an offering
!  The offering is not
limited to physical
products but is a
combination of products,
services, information, and
experiences.
Core Marketing Concepts

!  Value Proposition
!  Value propositions
reflect your brand
promise along with all
the primary benefits
offered to multiple
market segments.
Core Marketing Concepts
Value Proposition
A value proposition is a promise of value to be delivered, communicated,
and acknowledged.
A value proposition can apply to an entire organization, or products or
services.
Core Marketing Concepts
!  Brand Positioning
!  While the value
proposition reflects the
wider range of primary
benefits offered, the
positioning statement
points a laser beam at
only the most relevant
benefit and points of
competitive
differentiation that are
meaningful to the
Core Marketing Concepts
Brand Positioning

‘delivered in 30 minutes or it’s free’

Core Marketing Concepts
Brand Positioning

‘The safest car in which your family can ride’

Core Marketing Concepts

!  Value and Satisfaction

!  We can think of marketing as the
identification, creation,
communication, delivery, and
monitoring of customer value.
!  The buyer chooses the offerings
he or she perceives to deliver the
highest customer delivered value.
!  Satisfaction reflects a person s
judgment of a product s
perceived performance in
relationship to expectations.
Core Marketing Concepts
!  Supply Chain
!  is made up of the company,
suppliers, distributors and
ultimately customers who
partner with each other to
improve the performance of
the entire system
!  It is also referred to as the
Value Delivery Network
!  Competition is between
networks and not companies
Core Marketing Concepts
!  Levels of competition
!  The actual and potential rival offerings and substitutes that a buyer
might consider.
!  4 levels of competition are based on degree of product substitutability

Brand competition Industry competition

Core Marketing Concepts
!  Levels of competition

Generic competition Form competition

Core Marketing Concepts
!  The marketing environment
!  The marketing environment
consists of the task
environment and the broad
environment.
!  The task environment includes
the actors engaged in
producing, distributing, and
promoting the offering.
The New Marketing Realities
Every now and then a technology
comes along that is so profound, so
universal that its impact will change
everything. It will transform every
institution in the world, it will create !  Network information
winners and losers. It will change the
way we do business, the way we teach technology. The digital
our children, communicate and
interact as individuals revolution has created an
Information Age that
Lou Gerstner
Chairman, IBM Corporation promises to lead to more
accurate levels of
production, more targeted
communications, and more
relevant pricing.
The New Marketing Realities
!  Globalization.
Technological
advances in
transportation,
shipping, and
communication have
made it easier for
companies to market
in, and consumers to
buy from, almost any
country in the world.
The New Marketing Realities

!  Consumer empowerment.
!  In part, due to disintermediation
via the Internet, consumers have
substantially increased their
buying power.
!  From the home, office, or mobile
phone, they can compare product
prices and features and order
goods online from anywhere in
the world 24 hours a day, 7 days
a week, bypassing limited local
offerings and realizing significant
price savings.
Company Orientations Toward the
Marketplace
1.  The Production Orientation
"  Holds that customers will prefer
products that are widely
available and inexpensive.
"  Focuses on high production
efficiency, low cost, and mass
distribution
"  Assumes that consumers are
primarily interested in product
availability and low prices
"  Most practiced when demand
exceeds the supply, or when the
cost of the product is too high
and improved productivity is
required to bring it down
Company Orientations Toward the
Marketplace
2.  The Product Orientation
!  Holds that customers will
prefer those products that
offer the most quality,
performance of innovative
features
!  Focuses on making superior
products and improving
them over time.
!  Assumes that buyers admire
well made products and can
evaluate quality and
performance
Company Orientations Toward the
Marketplace
3.  The Selling Orientation
!  Holds that customers and
businesses, if left alone, will not
purchase enough of the
organization’s products.
!  Focuses undertaking aggressive
selling and promotion effort
!  Assumes consumers typically
show buying resistance and
must be coaxed into buying.
!  Most practiced with unsought
goods, non-profit and fund
raising organizations, and when
the company has production
overcapacity
Company Orientations Toward the
Marketplace

“Marketing is far too important

to be left only to the marketing department.
In fact…marketing is not a department
so much as a company orientation”
David Packard
HP
Company Orientations Toward the
Marketplace
4.  Marketing orientation
holds that the key to
achieving organizational
goals is being more
effective than competitors
in creating, delivering, and
communicating superior
customer value to your
target markets.
 Company Orientations Toward the
Marketplace
!  The marketing orientation is a customer-centered,
sense-and-respond philosophy.
!  The job is not to find the right customers for your

products, but the right products for your customers.

Target market Customer needs Integrated marketing Profits through

customer satisfaction

Starting Point focus Means End

Company Orientations Toward the
Marketplace
 Company Orientations Toward the
Marketplace

Marketing orientation
Integrated marketing concept
 Company Orientations Toward the
Marketplace
4 Ps or 4 Cs?
Company Orientations Toward the
Marketplace
5.  The holistic marketing
orientation is based on the
development, design, and
implementation of
marketing programs,
processes, and activities
that recognize their
breadth and
interdependencies.
Company Orientations Toward the
Marketplace
!  The holistic marketing orientation
!  Integratedmarketing occurs when the marketer devises
marketing activities and assembles marketing programs to
create, communicate, and deliver value. Two key themes are
that:
#  Many different marketing activities can create, communicate, and
deliver value
#  Marketers should design and implement anyone marketing activity
with all other activities in mind
Company Orientations Toward the
Marketplace
!  The Holistic Marketing Orientation
!  Relationship Marketing has the aim of building mutually
satisfying long-term relationship with key parties.
!  The ultimate outcome of relationship marketing is a unique
company asset called a marketing network, consisting of the
company and its supporting stakeholders customers,
employees, suppliers, distributors, retailers, and others with
whom it has built mutually profitable business relationships.
Company Orientations Toward the
Marketplace
!  The Holistic Marketing Orientation
!  Internalmarketing, an element of holistic marketing, is
the task of hiring, training, and motivating able
employees who want to serve customers well. It ensures
that everyone in the organization embraces
appropriate marketing principles
Company Orientations Toward the
Marketplace
!  The Holistic Marketing Orientation
!  Social responsibility marketing, The organization s
task is thus to determine the needs, wants, and interests
of target markets and satisfy them more effectively
and efficiently than competitors while preserving or
enhancing consumers and society s long-term well-being
Chapter Highlights
!  What marketing and marketing management is all
about.
!  Not only products and services that could be
marketed.
!  The marketing process and how it works.

!  How business and markets are changing in our new

era of information technology.
!  Fundamental marketing concepts

!  Different company orientations toward the

marketplace.