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Understanding

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Marketing Processes
and Consumer
Behavior

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What Is Marketing?

Process of planning and


executing the conception,
pricing, promotion and
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distribution of ideas, goods


and services to create
exchanges that satisfy
individual and
organizational objectives

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What Is a Marketing Plan?

Detailed strategy for


focusing marketing efforts
on consumer needs and
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wants

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Who Are Marketing
Managers?
Manager who plans and
implements the marketing
activities that result in the
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transfer of products or services


from producer to consumer

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Marketing: Providing Value
and Satisfaction

 Value and Benefits


 Value is the relative comparison of
a product’s benefits versus its costs
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 Benefits include the functions of


the product and the emotional
satisfaction associated with
owning, experiencing or
possessing it

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Marketing: Providing Value
and Satisfaction
 Value and Utility
 Utility is the ability of a product to satisfy
a human want or need. Four kinds:
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 Time Utility
 Place Utility
 Ownership Utility
 Form Utility

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What Is Relationship Marketing?

Marketing strategy
that emphasizes
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lasting relationships
with customers and
suppliers

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Marketing: Goods, Services
and Ideas
 Consumer goods are
products purchased by
consumers for personal use
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 Industrial goods are


products used by companies
to produce other products
 Services are intangible
products that can be
purchased

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The Marketing Environment

External environment is the combination of


outside factors that influence marketing programs
by posing opportunities and threats. Five
environmental factors:
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 Political–Legal Environment
 Social–Cultural Environment
 Technological Environment
 Economic Environment
 Competitive Environments

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The External Marketing
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Competitive Environment

 Substitute products differ from


those of competitors but can fill
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the same need

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Competitive Environment

 Brand competition occurs


between similar products
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Competitive Environment

 International competition
matches domestic products
against foreign products e.g.
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Tapal vs Lipton

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What Is the Marketing Mix
(or the “Four P’s”)?

Combination of
product, pricing,
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promotion and
distribution
(place) strategies
used to market
products

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What Is a Product?

A product is a good, service or


idea designed to fill a consumer
need or want.
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What Is a Product?
Product differentiation is the
creation of a product feature
or product image that differs
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enough from competing


products to attract consumers

How do they differentiate themselves?


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What Is Pricing?
Pricing is the process of selecting the
best price at which to sell a product.
 Prices must support a variety of costs
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 Prices must be competitive


 Low- and high-price strategies can be
effective in different situations

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What Is Distribution (Place)?
Distribution is part of the
marketing mix concerned with
getting products from producers to
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consumers.
 Decisions about warehousing, inventory
control and transportation options
 Decisions about channels

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What Is Promotion?

Promotion is the techniques for


communicating information about
products. There are different
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promotional tools e.g.


 Advertising
 Personal Selling
 Sales Promotions
 Public Relations

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What Is Target Marketing and
Market Segmentation?

 Target markets are groups


of people with similar wants
and needs
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 Market segmentation is
the process of dividing a
market into categories of
customer types

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Identifying Market Segments

 Geographic variables are


geographical units e.g. provinces,
cities etc.
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 Demographic variables are


characteristics of populations e.g.
Age, Gender, Education, Income,
Occupation, Marital Status, Parental
Status etc.

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Identifying Market Segments
 Psychographic variables are
consumer characteristics such as
lifestyles, personality and
attitudes
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 Behavioral variables are


consumer characteristics based
on the use of a product, benefits
sought from it, reasons for its
purchase and brand loyalty Toothpaste
-Whiteners
with:

-Fluoride
-Mouth Freshener
- Medicaments
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What Is Brand Loyalty?

Pattern of regular
consumer purchasing
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based on satisfaction with


a product

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What Is Marketing Research?

Study of consumer needs


and wants and the ways in
which sellers can best meet
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them

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The Research Process
. Study the current situation
. Select a research method
. Collect data
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• Secondary data is already available


from previous research
• Primary data is collected through new
research
. Analyze the data
. Prepare a report

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Research Methods
 Observation involves watching and
recording consumer behavior
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 Survey uses a questionnaire which serves


as the basis of interviews

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Research Methods
 Focus group involves a small gathering of
people who are presented with an issue and
asked to discuss it in depth
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 Experimentation compares the responses


of the same or similar people under different
circumstances under a controlled
environment

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What Is Consumer Behavior?

Study of the decision


process by which people
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buy and consume products

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Influences on Consumer
Behavior
Psychological influences:
individual’s motivations,
perceptions and attitudes
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Personal influences: lifestyle,


personality and economic status

Social influences: family, opinion


leaders and reference groups

Cultural influences: culture,


subculture and social class
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BUSINESS Consumer Buying Behavior

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