An Overview of MarketingCHAPTER 1

Learning Outcomes :
1.1 Overview of marketing

1.2 Elements of marketing mix

LEARNING (4P’s)
OUTCOME
S 1.3 Marketing management
philosophies
1.4 External marketing
environment
LO 1 :Overview of marketing
Definition of Marketing
LO 1 :The American Marketing Association’s
definition of marketing focuses on the
Overvie
second facet. Marketing is the activity,
set of institutions, and processes for
w of creating, communicating, delivering,
and exchanging offerings that have
marketin
value for customers, clients, partners,
and society at large.
g Marketing involves more than just
activities performed by a group of
people in a defined area or department.
LO 2 :Elements of marketing mix (4P’s)

The Four Ps
1. Product du
ct Pla
ce
o
Pr
2. Price
3. Place
4. Promotion
Pr
ice t ion
omo
Pr
LO 3 :Marketing management philosophies
Orientation Focus is on…

Production internal capabilities of the firm

Sales aggressive sales techniques and belief

that high sales result in high profits

satisfying customer needs and wants

Market while meeting objectives

satisfying customer needs and

Societal wants while enhancing individual and
societal well-being
Production Orientation
sales orientation
Market orientation
Societal marketing orientation
LO 4 : External marketing environment

• External environment/factors (outside the firm) where firms

work and compete, it is that things are constantly changing.

• If the organization doesn’t understand or fails to react to the

changing world around it, it will soon be a follower rather
than a leader. In the worst case scenario, the firm might
disappears. E.g. Nokia
LO 4 : External marketing environment

External Environment
Internal (uncontrollable) Social
(within the Factors
organization) Demograp
hics
Marketing mix

Product Economic
Place Factors
Promotio
n
Price
Competiti
on Target Market
Political &
Legal
Technolo Factors
Environmental gy
Scanning
External Environment of Marketing

Some of the key areas that firms should monitor

in the external environment are:

• Understanding current customers.

• Understanding what drives consumer
decisions.
• Identify the most valuable customers and
understand their needs.
• Understand the competition.

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Demographic Factors
Demography - The study of people’s vital statistics, such as their
age, race, ethnicity, and location.
Population
The most basic statistic of all is population because people are directly
or indirectly the basis of all markets.

Interesting facts : Malaysia's population rises to 32.6 million.

The Cohorts
• Tweens : Ages 9–14
• Teens : Ages 13–19
• Gen Y : Born between 1979–1994
• Gen X : Born between 1965–1978
• Baby Boomers : Born between 1946–1964
Tweens
▪ Ages 9–14
▪ Pop. 20 million
▪ Spend over $21
billion/year
▪ Heavy buying influence
on parents
▪ Biggest growth area: cell
phone usage

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Teens

▪ Ages 13–19
▪ Pop. 25 million
▪ Spend $195 billion/year
▪ Two-thirds go to a mall once/week.
▪ 90 percent engage in on-demand media/ entertainment.

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 Local A-List: The Rich Kids of
Malaysia
BY MARIE CLAIRE DECEMBER
19, 2016
Generation Y
▪ Born between 1979–1994
▪ Pop. 73 million
▪ Spend $200 billion/year
▪ Family-oriented, time managers
▪ Most ethnically
▪ Diverse generation
Some have already started their careers and are making
major purchasing decisions such as cars and homes; at the
very least, they are buying lots of computers, MP3
players, cell phones, DVDs, and sneakers.

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Generation X
▪ Born between 1965 and 1978
▪ Population of 40 million
▪ Savvy and cynical consumers
▪ More protective and involved with their kids
▪ Value the importance of education
▪ Avid buyers of the latest clothes, technology, and
recreational products

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Baby Boomers
▪ Born between 1946 and 1964
▪ Population of 77 million—
the largest demographic segment
▪ Boomers are postponing retirement – The 2007-2009
downturn has resulted in loss of $2 trillion.
▪ Income will continue to grow as they keep working
▪ Four segments of baby boomers:
“Looking for balance”
“Confident and living well”
“At ease”
“Overwhelmed”

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Social Factors
• Values, Attitudes & Lifestyles
• The Changing Role of Families and Working Women
• There Is Never Enough Time
Social Factors

Social factors include our attitudes, values, and

lifestyles.

Social factors influence the products people buy,

the prices paid for products, the effectiveness of
specific promotions, and how, where, and when
people expect to purchase products.

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Values
A value is a strongly held and enduring belief.

Four basic values strongly influenced attitudes and

lifestyles:

1. Self-sufficiency
2. Upward mobility
3. Work ethic
4. Conformity

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Social Factors

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Values
Values influence our buying habits.

U.S. consumers rank the characteristics of product

quality as:

(1) reliability,
(2) durability,
(3) easy maintenance,
(4) ease of use,
(5) a trusted brand name, and
(6) a low price.

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Role of Families and Working Women plus
Time
• Growth of dual-income families results in
increased purchasing power

• Approximately 63% of work-age females are in the

workforce

• Research shows that the large percentage of

people who say they never have enough time to
do all that they need to do. These
time-constrained mothers find that they have even
fewer quality hours to spend with their families.

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Economic Factors

Marketing managers must understand and react to

the economic environment.

The three economic areas of greatest concern to

most marketers are consumers’ incomes
(purchasing power), inflation, and recession.

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Economic Factors

Consumers’ incomes (purchasing power)

As disposable (or after-tax) incomes rise, more families
and individuals can afford the “good life.”

Purchasing power is measured by comparing income to

the relative cost of a set standard of goods and services in
different geographic areas, usually referred to as the cost
of living.

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Economic Factors

Inflation
Inflation is a measure of the decrease in the value of
money, generally expressed as the percentage reduction in
value since the previous year, which is the rate of inflation.

If inflation is 5 percent, you can expect that, on average,

prices have risen by about 5 percent since the previous
year. Of course, if pay raises are matching the rate of
inflation, then employees will be no worse off in terms of
the immediate purchasing power of their salaries.

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Economic Factors

Recession
A recession is a period of economic activity characterized
by negative growth. More precisely, a recession is defined
as when the gross domestic product falls for two
consecutive quarters.

The declining stock market, growing unemployment, and

collapsing home prices.

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Political and Legal Factors

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Political and Legal Factors

• Federal Legislation
• State Laws
• Regulatory Agencies
Technological Factors

• Research
• Global innovation
Technological Factors
https://www.technologyreview.com/2021/02/24/1014369/10-brea
kthrough-technologies-2021/
An ECG on your wrist
ECG-enabled smart watches, made possible by new regulations and
innovations in hardware and software, offer the convenience of a
wearable device with something closer to the precision of a medical one.

An Apple Watch–compatible band from Silicon Valley startup AliveCor

that can detect atrial fibrillation, a frequent cause of blood clots and
stroke, received clearance from the FDA in 2017. Last year, Apple
released its own FDA-cleared ECG feature, embedded in the watch
itself.
 Google has come up with an interim
solution: a $159 pair of earbuds, called
Pixel Buds. These work with its Pixel
smartphones and Google Translate
app to produce practically real-time
translation.

One person wears the earbuds, while

the other holds a phone. The earbud
wearer speaks in his or her
language—English is the default—and
the app translates the talking and
plays it aloud on the phone. The
person holding the phone responds;
this response is translated and played
through the earbuds.

https://en.wikipedia.org/wiki/Apple_earbuds
Competitive Factors

How many competitors?

How big are competitors?

How interdependent is
the industry?

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Competitive Factors

• Competition for Market Share and Profits

• Global Competition
 Competitive Factors

Competition for Market Global Competition

Share and Profits
• Firms must work harder to
maintain profits and market
share.
• More foreign firms
are entering U.S. market.
• Foreign firms in U.S. now
compete on product quality.

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 Competitive Factors

https://en.wikipedia.org/wiki/Telecommunic
ations_in_Malaysia
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 Competitive Factors

Fast food industry in Malaysia

https://www.trustedmalaysia.com/fast-food-statistics-malaysia/

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