Marketing Management 6e

Marketing Management 6e
Chapter 1: Why Is Marketing Management Important?
Dawn Iacobucci, Marketing Management, 6th Edition. © 2022 Cengage. All Rights Reserved. May not be
scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Learning Objectives
• After you have finished this chapter, you should be able to:
• 1-1: Define marketing
• 1-2: Describe the role of marketing in relation to the consumer and the firm
• 1-3: Explain the importance of marketing within a firm
• 1-4: Describe how the “5Cs, STP, and 4Ps” enhance the marketing
exchange between a consumer and a firm
1-1
Defining Marketing
Marketing as a Profession
• Marketing . . .
• brings in customers, and customers bring in money.
• helps to build brand equity and the company’s reputation.
• helps engage the customer and the company can learn from its
customer relationships.
• helps a company stay ahead of the competition.
1-2
Marketing Is an Exchange Relationship
Marketing Defined
• Marketing is defined as an exchange between a firm and its customers.
What Can We Market?
(1 of 3)
What Can We Market?
(2 of 3)
What Can We Market?
(3 of 3)
Discussion Activity 1
1. What is the definition of marketing?
2. What can be marketed?
Discussion Activity 1 Debrief
1. What is the definition of marketing?
– Answer: Marketers try to figure out what customers want and
how to provide it profitably.
2. What can be marketed?

– Answer: A quick answer for this question is “everything,” which
includes tangible goods and services, ideas, experiences, nonprofit
causes, etc.
1-3
Why Is Marketing Management Important?
Evolution of Modern Marketing
• Product/production orientation
– Focus on building a better gadget.
• Sales orientation
– Focus on convincing the customer that your product works
best for them.
• Customer orientation
– Focus on identifying customers’ wants BEFORE formulating
attractive solutions.
Who Is Responsible for Marketing?
• Marketing and customer satisfaction is everyone’s
responsibility.
• Marketing should permeate the firm:
– Accounting/finance
– Sales
– Research and development
Reasons to Measure Marketing Success
• Pressure to show results
• Ensure that the chief marketing officer (CMO)
carries as much weight as the CEO, CFO, or COO
Measuring Marketing Success
(1 of 2)
• Quantify results when possible.
• Sometimes the effectiveness of marketing programs is easy
to quantify.
– Did the coupon promotion lift sales?
• Measure the percentage sales increase, etc.
– Did the direct mail campaign increase web usage?

• Measure the number of web visits, etc.
Measuring Marketing Success
(2 of 2)
• However, sometimes the effectiveness is not easy to
quantify.
– Was the segmentation study effective?
– Did the advertising campaign increase sales?
• Difficult to quantify because great advertising is geared toward long-term
brand building, not short-term results
1-4
The “Marketing Framework”: 5Cs, STP,
and the 4Ps
[Author Name], [Book Title], [#] Edition. © [Insert Year] Cengage. All Rights Reserved. May not be scanned,
copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Marketing Management Framework
• The 5Cs, STP, and the 4Ps constitute the marketing
management framework.
5Cs
(1 of 3)
• Customer
– The firm’s current and potential customers
• What are current customers’ preferences, buying trends, etc.?
• What are potential customers’ preferences? Should they be targeted?
• Company
– The firm’s capabilities, resources, etc.
• What does it do well?
• What doesn’t it do well?
5Cs
(2 of 3)
• Context
– Macro-environmental forces facing the firm:
• What is going on politically or legally that might affect the firm?
• What is going on with the economy that might affect the firm?
• What trends are occurring in society that might affect the firm?
• What technological innovations might affect the firm?
5Cs
(3 of 3)
• Collaborators
– The companies/people a firm works with
• Are these relationships strong? Can these relationships be improved or
leveraged?
• Competitors
– The companies/people a firm works against and how they
compare to the firm in terms of resources, capabilities, customer
preferences, reaction patterns, etc.
STP
• Segmentation
– Grouping customers with similar needs
• Targeting
– Pursuing segment who makes the most sense for the firm
• Positioning
– Communicating product’s benefits clearly to the intended target
• Developed through the 4Ps
4Ps
(1 of 2)
• Product
– Goods or services customers need or want
– What should constitute your product mix? What features and
benefits should comprise each product?
• Price
– How much should you charge given your costs, competitive
pricing, and customer demand?
4Ps
(2 of 2)
• Place
– How will you get the product into customers’ hands? Will you go
directly to customers or use channel partners?
• Promotion
– What communications mix will you use to communicate with your
targets? What message will you use?
Considerations
(1 of 2)
• The situation facing the company changes over time.
– Customer preferences change.
– Competitors change offerings.
– Government passes new laws, etc.
• Firm must consistently monitor the 5Cs.
Considerations
(2 of 2)
• 5Cs, STP, and 4Ps are interdependent.
– With a change in contextual factor, what would be the impact on
distribution channels?
– What would a collaborator’s shifting demands do to our pricing
structure?
– What impact might the selloff of a nonperforming function of the
company have on our positioning and customer satisfaction?
• Marketers must understand the interdependencies.
Group Activity
• Form groups of 3-5 participants. Consider the following points and
prepare a short summary to present to the class.
• Your company manufactures high-end gas fireplaces. Current
production is only at 70% of total capacity. The executive team is
considering expanding production into new products. They have
tasked your marketing team with reporting on what you recommend.
• In your brief report, outline the factors you considered and what your
recommendation would be.
• Share group reports.
Group Activity Debrief
• Recommendation for using excess production capacity
• Can range from new innovative fireplaces to producing lower-cost fireplaces
accessible to a wider market.
• Assess how the recommendation considers the 5Cs (customer, company, context,
collaborators, competitors), STP (segmentation, targeting, positioning), and the
4Ps (product, price, place, promotion).
• As a class, discuss any especially creative recommendations or surprising
interpretations of the goal.
Book Layout
Flow in Each Chapter
• Each chapter covers the What, Why, and How:
– What is the topic in this chapter?
– Why does it matter?
– How do I do this?
Managerial Recap
(1 of 2)
• Marketing can make customers happier and companies
more profitable.
• Marketing is about trying to find out what customers would
like, providing it to them, and doing so profitably.
• Marketing facilitates a relationship between customers and
a company.
Managerial Recap
(2 of 2)
• Just about anything can be marketed.
• The marketing management framework—5Cs, STP, 4Ps—
will structure the book.
• If you can remain customer-centric, you’ll be five steps
ahead of the competition.
Knowledge Check Activity 1
• In today’s world, marketers feel the most stress from which of
the following pressures?
a. The pressure to increase stock price
b. The pressure to produce more return on investment than R&D
c. The pressure to show results
d. The pressure to prove they are valuable
What did we learn?
1. If you ask the average person, “What is marketing?” you might hear something
like, “Marketers make people buy stuff they don’t need and can’t afford.”
a. True
b. False
ANSWER: True
2. Marketing is defined as an exchange between a firm and its customers.
a. True
b. False
ANSWER: True
3. In a marketing exchange, a customer _____.
a. seeks profits
b. offers benefits
c. seeks payment
d. expects to pay
ANSWER: d
Quick Repeat of Concepts
Phlip Kotler Customer Retention
Market Customer Acquisition
Marketing What is marketed
Needs – Wants – Demand Cross-selling / Upselling
ExchangeCore Business
Commodity Private Label (Store Brand)
Marketing Mix Value Proposition
SWOT Analysis Outsourcing
PEST Analysis Customer Touch Point
Competitor NPD & PLC
Mission Statement STP
Product Price Elasticity
Outsourcing Unique Selling Proposition (USP)
Discussion Questions
1) Why Gucci sells more expensive than other competitors?
2) Why Starbucks is more preferred even though it is more
expensive than its competitors (in selling a commodity)?
3) Why Paris is more recognized; why not Almaty?
4) Does Coca-Cola has indirect competitors?
5) What are 4 types of consumer products?
6) What are the layers of a product?
Presentation Topics
1) Tylenol Case, J&J
2) Marketing of High-Tech products and Services
3) Development of Private label in KZ (Store Brands)
4) Marketing of Luxury goods
5) Branding and Marketing of Cities & Countries in Central Asia
A note on Luxury Goods:
Bernard Arnault- Richest man in Europe (4. worldwide).
Company: Louis Vuitton Moet Hennessy.
Products include Christian Dior, Tiffany & Co., Sephora,
Hennessy, Bulgari, etc.
Amancio Ortega- Second richest in Europe (5. worldwide).
Spanish, company: Inditex / Zara

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Marketing Management 6e

Chapter 1: Why Is Marketing Management Important?

• 1-1: Define marketing

• 1-3: Explain the importance of marketing within a firm

2. What can be marketed?

– Did the direct mail campaign increase web usage?

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