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Principles of

Contemporary Marketing
Kurtz & Boone
Chapter 1
Marketing: The Art and Science of
Satisfying Customers

CHAPTER 1 Marketing: The Art and Science of Satisfying Customers

Chapter Objectives
1. Define marketing, explain how it creates utility,
and describe its role in the global marketplace.
2. Contrast marketing activities during the four
eras in the history of marketing.
3. Explain the importance of avoiding marketing
myopia.
4. Describe the characteristics of not-for-profit
marketing.

Copyright 2012 by South Western, a division of Cengage Learning. All rights reserved.

CHAPTER 1 Marketing: The Art and Science of Satisfying Customers

Chapter Objectives
5. Identify and briefly explain each of the five types
of nontraditional marketing.
6. Explain the shift from transaction-based
marketing to relationship and social marketing.
7. Identify the universal functions of marketing.
8. Demonstrate the relationship between ethical
business practices, social responsibility,
sustainability and marketplace success.

Copyright 2012 by South Western, a division of Cengage Learning. All rights reserved.

CHAPTER 1 Marketing: The Art and Science of Satisfying Customers

What is Marketing?
o Organizations must create utility to
survive

Copyright 2012 by South Western, a division of Cengage Learning. All rights reserved.

CHAPTER 1 Marketing: The Art and Science of Satisfying Customers

Copyright 2012 by South Western, a division of Cengage Learning. All rights reserved.

CHAPTER 1 Marketing: The Art and Science of Satisfying Customers

A Definition of Marketing
o Marketing - An organizational function
and a set of processes for:
o Creating, communicating, and delivering
value to customers
o Managing customer relationships in ways
that benefit the organization and its
stakeholders

Copyright 2012 by South Western, a division of Cengage Learning. All rights reserved.

CHAPTER 1 Marketing: The Art and Science of Satisfying Customers

Todays Global Marketplace


o Factors that have extended economic
views
o Increase in international trade agreements
o Growth of electronic business
o Interdependence of the worlds economies

Copyright 2012 by South Western, a division of Cengage Learning. All rights reserved.

CHAPTER 1 Marketing: The Art and Science of Satisfying Customers

Four Eras in the History of Marketing


o The essence of marketing is the
exchange process

Copyright 2012 by South Western, a division of Cengage Learning. All rights reserved.

CHAPTER 1 Marketing: The Art and Science of Satisfying Customers

Copyright 2012 by South Western, a division of Cengage Learning. All rights reserved.

CHAPTER 1 Marketing: The Art and Science of Satisfying Customers

Characteristics of the Four Eras

Era in marketing

Focus

Production Era

Production orientation

Sales Era

Sales orientation

Marketing Era

Consumer orientation

Relationship Era

Relationship marketing

Copyright 2012 by South Western, a division of Cengage Learning. All rights reserved.

CHAPTER 1 Marketing: The Art and Science of Satisfying Customers

Avoiding Marketing Myopia


o Marketing myopia - Managements
failure to recognize the scope of its
business
o Focusing on customer need satisfaction
can overcome myopia

Copyright 2012 by South Western, a division of Cengage Learning. All rights reserved.

CHAPTER 1 Marketing: The Art and Science of Satisfying Customers

Not-for-Profit Marketing
o Marketing in not-for-profit organizations
o Marketing strategy is adopted to meet
service objectives
o Not-for-profit organizations form alliances
with business firms for mutual benefit

o Characteristics of not-for-profit marketing


o Does not focus on bottom line
o Markets to multiple audiences
Copyright 2012 by South Western, a division of Cengage Learning. All rights reserved.

CHAPTER 1 Marketing: The Art and Science of Satisfying Customers

Copyright 2012 by South Western, a division of Cengage Learning. All rights reserved.

CHAPTER 1 Marketing: The Art and Science of Satisfying Customers

Relationship Marketing
o Focus is on moving the customers up the
loyalty ladder to increase their lifetime
value
o Interactive marketing creates direct
communication with customers, allows
larger exchanges, and puts the customer
in control
o It is increasingly taking place on social
media sites like Facebook, Twitter, and
blogs
Copyright 2012 by South Western, a division of Cengage Learning. All rights reserved.

CHAPTER 1 Marketing: The Art and Science of Satisfying Customers

Copyright 2012 by South Western, a division of Cengage Learning. All rights reserved.

CHAPTER 1 Marketing: The Art and Science of Satisfying Customers

Partnerships and Strategic Alliances


o Strategic alliances provide firms
competitive advantage
o Forms of alliances
o Product development partnerships
o Vertical alliances

o Not-for-profits often raise awareness and


funds through strategic partnerships

Copyright 2012 by South Western, a division of Cengage Learning. All rights reserved.

CHAPTER 1 Marketing: The Art and Science of Satisfying Customers

Costs and Functions of Marketing


o Firms spend money (thereby incurring
costs) to create utility
o Functions of marketing
o Exchange functions - Buying and selling
o Physical distribution functions Transporting and storing
o Facilitating functions - Standardizing and
grading, financing, risk taking, and
securing marketing information
Copyright 2012 by South Western, a division of Cengage Learning. All rights reserved.

CHAPTER 1 Marketing: The Art and Science of Satisfying Customers

Copyright 2012 by South Western, a division of Cengage Learning. All rights reserved.

CHAPTER 1 Marketing: The Art and Science of Satisfying Customers

Ethics and Social Responsibility


o Companies that promote ethics and
social responsibility produce increased
employee loyalty and customer growth
o Social responsibility programs are meant
to enhance the society but help in
improving public image of the firm
o Sustainable products and practices
are goals of socially responsible firms

Copyright 2012 by South Western, a division of Cengage Learning. All rights reserved.