Marketing

Principles and
Strategies
1.1 Introduction to Marketing
◈Production and marketing of goods and services
are the essence of economic life in any society
◈All organizations perform these two basic
functions to satisfy their commitments to their
stakeholders – the owners, the customers and the
society, at large

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 UTILITY

◈A benefit for economist, which

is the want-satisfying power of
a good or service.

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 four basic kinds of utility

◈Form
◈Time
◈ Place and
◈ownership utility
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 Form utility

◈It is created when the firm converts raw

materials and component inputs into finished
goods and services.
◈the organization’s production function is
responsible for the actual creation of form
utility
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 Time and place utility

◈It occurs when consumers find

goods and services available
when and where they want to
purchase them.
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 ownership utility.

◈The transfer of title to goods or

services at the time of purchase
creates ownership utility

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 Type Description Examples Responsible
function
Form Conversion of raw materials Pizza made from Production
and components into finished several ingredients
goods and services

Time Availability of goods and Dial-a-pizza; delivery Marketing

services when consumers guaranteed in 30 min.
want them

Place Availability of goods and Delivery at your Marketing

services where consumers doorstep
want them

Ownership Ability to transfer title to Pizza sales (in Marketing

(possession) goods or services from exchange for rupees or
marketer to buyer credit card payment)
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Management guru, Peter F.Drucker emphasized the importance of
marketing in his classic book, The Practice of Management as

◈ ‘If we want to know what a business is, we

have start with its purpose. And its purpose
must lie outside the business itself. In fact, it
must lie in society since a business enterprise is
an organ of society. There is one valid
definition of business purpose: to create a
customer’.
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How does an organization create a customer? Guiltinan
and Paul explain it this way:

◈Essentially, ‘creating’ a customer means

identifying needs in the marketplace,
finding out which needs the organization
can profitably serve and developing an
offering to convert potential buyers into
customers.
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 In creating the customer wants. This activities includes:

 Identifying customer needs

 Designing goods and services that meet those needs
 Communication information about those goods and services to
prospective buyers
 Making the goods and services available at times and places that
meet customers’ needs
 Pricing goods and services to reflect costs, competition and
customers’ ability to buy
 Providing for the necessary service and follow-up to ensure
customer satisfaction after the purchase
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 Activity 1.1.1
◈ Think of a recent purchase you made. How did the company provide
you with the following utilities?
Form __________________________________________________
Time __________________________________________________
Place __________________________________________________
Ownership
__________________________________________________

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What is Marketing?

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 What is Marketing?
◈ A philosophy whose main function is providing customer
satisfaction.

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 What is Marketing?
◈Marketing also involves analyzing consumer
needs, securing information needed to design
and produce goods or services that match
buyer expectations and creating and
maintaining relationships with customers and
suppliers.
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 The following table summarizes the key differences between
marketing and selling concepts

Point of difference SELLING MARKETING

Starting point Factory Marketplace

Focus Existing products Customer needs

Means Selling and Integrated

promoting marketing
End Profits through Profits through
volume satisfaction
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 “
‘Don’t tell me how good
your product is, but tell
me how good it will make
me’.

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professional marketers, defines marketing
as:

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

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 contemporary definitions

‘marketing is the process of creating and

resolving exchange relationships’ and
‘marketing is the process in which exchanges
occur among persons and social groups’

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 contemporary definitions

The essence of marketing is the exchange

process, in which two or more parties give
something of value to each other to satisfy
felt needs. In many exchanges, people trade
tangible goods for money. In others, they
trade intangible services.

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 To explain marketing definition, we
examine the following important terms
○ Needs, wants, and demands
○ Products and services
○ Value, satisfaction and quality
○ Exchange,transactions,and relationships
○ Markets

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Needs, Wants, and Demands

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 Products and Services
Product:
◈ Anything that can be offered to a market to satisfy a need or
want.
◈ The concept of product is not limited to physical objects –
anything capable of satisfying a need can be called a product.
Services:
◈ In addition to tangible goods, products also include services,
which are activities or benefits offered for sale that are essentially
intangible and do not result in the ownership of anything.

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 Values, Satisfaction, and Quality
Values:
◈Customer value is the difference between the
values the customer gains from owning and
using a product and the costs of obtaining the
products.
◈Customers often do not judge product value
and costs accurately or objectively. They act on
perceived value.
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 Values, Satisfaction, and Quality
Satisfaction:
◈Customer satisfaction depends on a product’s
perceived performance in delivering value
relative to a buyer’s expectation.
◈If the product’s performance falls short of the
customer’s expectations, the buyer is
dissatisfied.
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 Values, Satisfaction, and Quality
Quality:
◈ Customer satisfaction is closely linked to quality.
◈ Quality has a direct impact on product performance.
◈ Quality can be defined as “freedom from defects”.
◈ TQM programs designed to constantly improve the
quality of products, services, and marketing processes.

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 EVALUATION

Identify if it is concept of Selling or Marketing.

1. Candy Factory
2. Consumer Needs
3. Super Market
4. Gallon of Water (5pcs for 100)
5. Iphone Series
6. Acienda Outlet
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 EVALUATION

Identify if it is concept of Selling or Marketing.

7. Colgate - Buy 1 take 1
8. Removal of unwanted hair at Skin station
9. Branded overrun – 100pcs for 9,000
10. Rides/amenities at Enchanted kingdom

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 Evaluation (identification)

1. The state of deprivation: physically, socially and

individuality.
2. Human wants backed by buying power.
3. Anything that can be offered to a market to satisfy a need
or want.
4. A program designed to constantly improve the quality of
products, services, and marketing processes.
5. Can be defined as freedom from defects.
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 Activity 1.1.2

◈Tick the myths you thought

about marketing before?

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 Marketing and selling are synonymous
 The job of marketing is to develop good
advertisements
 Marketing is pushing the product to the customers
 Marketing is transaction-oriented than relationship-
oriented

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Marketing is a short-term business
strategy
Marketing is an independent function of a
business
Marketing is part of selling

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