Chapter 1

Defining Marketing
for the Twenty-
First Century
PowerPoint by HENG Sophea
IMD

Marketing Management, Lectured by HENG Sophea, Mcom – H/P: 017 735 753 / 098 600 101 Slide 1 in Chapter 1
 Objectives

 Understand the new economy.

 Learn the tasks of marketing.
 Become familiar with the major
concepts and tools of marketing.
 Understand the orientations
exhibited by companies.
Marketing Management, Lectured by HENG Sophea, Mcom – H/P: 017 735 753 / 098 600 101 Slide 2 in Chapter 1
 Objectives

 Learn how companies and

marketers are responding to
new challenges.

Marketing Management, Lectured by HENG Sophea, Mcom – H/P: 017 735 753 / 098 600 101 Slide 3 in Chapter 1
 The New Economy

 Consumer benefits from the digital

revolution include:
– Increased buying power.
– Greater variety of goods and
services.
– Increased information.
– Enhanced shopping convenience.
– Greater opportunities to compare product
information with others.
Marketing Management, Lectured by HENG Sophea, Mcom – H/P: 017 735 753 / 098 600 101 Slide 4 in Chapter 1
 The New Economy

 Firm benefits from the digital

revolution include:
– New promotional medium.
– Access to richer research
data.
– Enhanced employee and customer
communication.
– Ability to customize promotions.
Marketing Management, Lectured by HENG Sophea, Mcom – H/P: 017 735 753 / 098 600 101 Slide 5 in Chapter 1
 Marketing Tasks

 Marketing practices may pass

through three stages:
– Entrepreneurial marketing
– Formulated marketing
– Intrepreneurial marketing
 As marketing becomes more
formulated, creativity is inhibited.
Marketing Management, Lectured by HENG Sophea, Mcom – H/P: 017 735 753 / 098 600 101 Slide 6 in Chapter 1
 What Can Be Marketed?

 Goods  Places
 Services  Properties
 Experiences  Organizations
 Events  Information
 Persons  Ideas
Marketing Management, Lectured by HENG Sophea, Mcom – H/P: 017 735 753 / 098 600 101 Slide 7 in Chapter 1
 Marketing Defined

 Kotler’s social definition:

“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.”

Marketing Management, Lectured by HENG Sophea, Mcom – H/P: 017 735 753 / 098 600 101 Slide 8 in Chapter 1
 Marketing Defined

 The AMA managerial definition:

“Marketing is the process of
planning and executing the
conception, pricing, promotion,
and distribution of ideas, goods,
and services to create exchanges
that satisfy individual and
organizational objectives.”

Marketing Management, Lectured by HENG Sophea, Mcom – H/P: 017 735 753 / 098 600 101 Slide 9 in Chapter 1
 Core Marketing Concepts

 Target markets and  Exchange and

market segmentation transactions
 Marketplace, market-  Relationship and
space, metamarkets networks
 Marketers & prospects  Marketing
 Needs, wants, demands  channels
 Product offering and  Supply chain
brand  Competition
 Value and  Marketing environment
satisfaction
Marketing Management, Lectured by HENG Sophea, Mcom – H/P: 017 735 753 / 098 600 Marketing
101 program
Slide 10 in Chapter 1
 Core Marketing Concepts

 Target markets & segmentation

– Differences in needs, behavior,
demographics or psychographics
are used to identify segments.
– The segment served by the firm is
called the target market.
– The market offering is customized
to the needs of the target market.
Marketing Management, Lectured by HENG Sophea, Mcom – H/P: 017 735 753 / 098 600 101 Slide 11 in Chapter 1
 Core Marketing Concepts

 Shopping can take place in a:

– Marketplace (physical entity, Lowe’s)
– Marketspace (virtual entity, Amazon)
 Metamarkets refer to complementary
goods and services that are related
in the minds of consumers.
 Marketers seek responses from
prospects.
Marketing Management, Lectured by HENG Sophea, Mcom – H/P: 017 735 753 / 098 600 101 Slide 12 in Chapter 1
 Core Marketing Concepts

 Needs describe basic human

requirements such as food, air, water,
clothing, shelter, recreation, education,
and entertainment.
 Needs become wants when they are
directed to specific objects that might
satisfy the need. (Fast food)
 Demands are wants for specific
products backed by an ability to pay.
Marketing Management, Lectured by HENG Sophea, Mcom – H/P: 017 735 753 / 098 600 101 Slide 13 in Chapter 1
 Core Marketing Concepts

 A Product is any offering that can

satisfy a need or want, while a brand
is a specific offering from a known
source.
 When offerings deliver value and
satisfaction to the buyer, they are
successful.

Marketing Management, Lectured by HENG Sophea, Mcom – H/P: 017 735 753 / 098 600 101 Slide 14 in Chapter 1
 Enhancing Value

 Marketers can enhance the value of

an offering to the customer by:
– Raising benefits.
– Reducing costs.
– Raising benefits while lowering costs.
– Raising benefits by more than the
increase in costs.
– Lowering benefits by less than the
reduction in costs.
Marketing Management, Lectured by HENG Sophea, Mcom – H/P: 017 735 753 / 098 600 101 Slide 15 in Chapter 1
 Core Marketing Concepts

 Exchange involves obtaining a desired

product from someone by offering
something in return. Five conditions
must be satisfied for exchange to occur.
 Transaction involves at least two things
of value, agreed-upon conditions, a time
of agreement, and a place of
agreement.

Marketing Management, Lectured by HENG Sophea, Mcom – H/P: 017 735 753 / 098 600 101 Slide 16 in Chapter 1
 Core Marketing Concepts

 Relationship marketing aims to

build long-term mutually satisfying
relations with key parties, which
ultimately results in marketing
network between the company and
its supporting stakeholders.

Marketing Management, Lectured by HENG Sophea, Mcom – H/P: 017 735 753 / 098 600 101 Slide 17 in Chapter 1
 Core Marketing Concepts

Marketing  Deliver messages to

Channels and receive
messages from
target buyers.
 Communication
channels  Includes traditional
media, non-verbal
 Distribution communication, and
channels store
atmospherics.
 Service channels
Marketing Management, Lectured by HENG Sophea, Mcom – H/P: 017 735 753 / 098 600 101 Slide 18 in Chapter 1
 Core Marketing Concepts

Marketing  Display or deliver

Channels the physical
products or
 Communication services to the
channels buyer / user.
 Distribution
channels
 Service
channels
Marketing Management, Lectured by HENG Sophea, Mcom – H/P: 017 735 753 / 098 600 101 Slide 19 in Chapter 1
 Core Marketing Concepts

Marketing  Carry out

Channels transactions with
potential buyers
 Communication by facilitating
channels the transaction.
 Distribution
channels
 Service
channels
Marketing Management, Lectured by HENG Sophea, Mcom – H/P: 017 735 753 / 098 600 101 Slide 20 in Chapter 1
 Core Marketing Concepts

 A supply chain stretches from raw

materials to components to final
products that are carried to final
buyers.
 Each company captures only a
certain percentage of the total value
generated by the supply chain.

Marketing Management, Lectured by HENG Sophea, Mcom – H/P: 017 735 753 / 098 600 101 Slide 21 in Chapter 1
 Core Marketing Concepts

 Four levels of competition can be

distinguished by the level of product
substitutability:
– Brand competition
– Industry competition
– Form competition
– Generic competition
Marketing Management, Lectured by HENG Sophea, Mcom – H/P: 017 735 753 / 098 600 101 Slide 22 in Chapter 1
 Core Marketing Concepts

 The following forces in the broad

environment have a major impact on
the task environment:
– Demographics
– Economics
– Natural environment
– Technological environment
– Political-legal environment
– Social-cultural environment

Marketing Management, Lectured by HENG Sophea, Mcom – H/P: 017 735 753 / 098 600 101 Slide 23 in Chapter 1
 Core Marketing Concepts

 The marketing program is developed

to achieve the company’s
objectives. Marketing mix decisions
include:
– Product: provides customer solution.
– Price: represents the customer’s cost.
– Place: customer convenience is key.
– Promotion: communicates with
customer.

Marketing Management, Lectured by HENG Sophea, Mcom – H/P: 017 735 753 / 098 600 101 Slide 24 in Chapter 1
 Company Orientations

 The orientation or philosophy of the

firm typically guides marketing efforts.
Several competing orientations exist:
– Production concept
– Product concept
– Selling concept
– Marketing concept
– Customer concept
– Societal marketing concept

Marketing Management, Lectured by HENG Sophea, Mcom – H/P: 017 735 753 / 098 600 101 Slide 25 in Chapter 1
 The Marketing Concept

 Achieving organizational goals

requires that company be more
effective than competitors in creating,
delivering, and communicating
customer value.
 Four pillars of the marketing concept:
– Target market
– Customer needs
– Integrated marketing
– Profitability
Marketing Management, Lectured by HENG Sophea, Mcom – H/P: 017 735 753 / 098 600 101 Slide 26 in Chapter 1
 Changes in the Marketplace

 Globalization, technological
advances, and deregulation have
created many challenges:
– Customers
– Brand manufacturers
– Store-based retailers
 Both companies and marketers have
been forced to respond and adjust.
Marketing Management, Lectured by HENG Sophea, Mcom – H/P: 017 735 753 / 098 600 101 Slide 27 in Chapter 1