MKT 243

FUNDAMENTALS OF
MARKETING
CHAPTER 1

Lecturer: Vloreen Nity Mathew

March 22
LECTURE
TOPICS
 Definition of marketing
 Exchange process
 Elements of Marketing Mix
 Marketing Management Philosophies /
Orientations
LESSON OBJECTIVES

The Overview of Marketing

To describe the elements of Marketing Mix

To describe the Marketing Management Philosophies

To describe the external marketing environment

WHAT IS
MARKET
ING?
MARKET
The set of all actual and potential buyers of a product
AMERIC
AN
MARKET The process of planning and
ING executing the conception/idea,
pricing, promotion, and distribution
ASSOCIA of ideas, goods, and services to create
TION exchanges that satisfy individual and
organizational goals.
DEFINE
MARKET
ING AS;
THE MARKETING MIX
 PRODUCT

Anything that can be offered to a

market for attention, acquisition, Tangible and
use or consumption that might
satisfy a want or need.
intangible in
nature
EXAMPLES OF TANGIBLE PRODUCTS
(GOODS )
EXAMPLES OF INTANGIBLE
PRODUCTS (SERVICES)
 Putting products in the market through
marketing channels- sets of interdependent
organizations involved in the process of
making a product or service available
(online or/and offline) for use or
consumption.

Place explains where and

how customers can get
access to the products PLACE

location and
distribution
 The amount of
money charged for a
product or the sum
of the values that
consumers exchange
for the benefits of
having or using the
product

PRICE
PROMOTION
activity that supports or provides
active encouragement for the
furtherance of a cause, venture, or
aim.
It compasses all the tools in
marketing mix – advertising,
personal selling, publicity and sales
promotion
A communication activity between
seller and potential buyer
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 goals.
 The concept of exchange
means that people give up
something in order to
THE receive something that they
CONCEPT would rather have.
OF
EXCHANG
E Common medium of
exchange is money.
 FIVE CONDITIONS MUST BE
SATISFIED FOR AN EXCHANGE
TO TAKE PLACE
1. There must be at least two parties.
2. Each party has something that might be of value to the other party.
3. Each party is capable of communication and delivery.
4. Each party is free to accept or reject the exchange offer.
5. Each party believes it is appropriate or desirable to deal with the
other party.
p/s. Exchange may not take place even if all of these conditions exist,
but these conditions are necessary for exchange to be possible.
QUICK CHECK!
As you have understood the marketing mix, can you try
giving examples to each component of the marketing mix?
Product ?
Price?
Promotion?
Place?
Prepare your answer and might be called to share your
answer soon!
Share your answer in the Google Classroom stream.
MARKETING MANAGEMENT
PHILOSOPHIES

Production Orientation

Sales Orientation

Marketing Orientation

Societal Marketing Orientation

PRODUCTION
ORIENTATION

The production orientation focuses The firm is concerned with what it Eg: Energy Supply Services
on internal capabilities of the firm does best, based on its resources
rather than on the desires and and experience, rather than with
needs of the marketplace. what consumers want.
 A sales orientation assumes that more
goods and services will be purchased if
aggressive sales techniques are used and
that high sales result in high profits.

SALES For example;

ORIENTATION
MARKET ORIENTATION

The marketing concept statesthat the social

and economic justification for an
organization's existence is the
satisfaction of customer wants and
needs while meeting organizational objectives.
The marketing concept involves:

a. Focusing on customer wants and needs

so the organization can differentiate its
product(s) from competitors' offerings
MARKET
ORIENTATION
b. Integrating all the organization's
activities, including production, to satisfy
these wants and needs

c. Achieving long-term goals for the

organization by satisfying customer wants
and needs legally and responsibly.
SOCIETAL
MARKETING
ORIENTATION
An organization existences not only to satisfy
customer wants and needs and to meet organizational
goals, but also to preserve or enhance individuals’ and
society's long-term best interests.
This orientation extends the marketing concept to
serve three bodies: customers, the organization itself,
and society as a whole.
Example : Honda produces Hybrid cars
Marketing Management Philosophies
Orientati
on Key Ideas

Focus on efficiency of internal operations

Production

Focus on aggressive sales techniques

Sales and believe that high sales result in
high profits
Focus on satisfying customer needs
Market and wants
while meeting objectives
Focus on satisfying customer needs
Societal and wants while enhancing individual
and
societal well-being
 1. Social
2. Demographic
1.4.THE
EXTERNA
L 3. Economic
MARKETI
NG 4. Political and
ENVIRON
MENT Legal
5. Technological
6. Competitive
HOW DO SOCIAL
FORCES AFFECT
MARKETING?
Decisions on the types of products purchased
Prices customers are willing to pay
Effectiveness of promotion
How where and when
DEMOGRAPHIC TRENDS: SHIFTS IN AGE

Generational marketing is important in segmenting people by

lifestyle of life state instead of age
 DEMOGRAPHIC TRENDS: SHIFTS IN AGE
BABY BOOMERS GENERATION X GENERATION Y

• people born between 1946 and • born between 1965 and 1976
1964 • Cautious economic outlook
• Most affluent customers • Less materialistic
• Family comes first
• Millennials (gen Y or
echo boomers) include
those born between 1977
and 2000
• Comfortable with
technology
• Tweens (ages 8–12)
• Teens (13–19)
• Young adults (30-20’s)
DEMOGRAPHIC
TRENDS:
FAMILY
STRUCTURE
More people are:

Divorcing or separating

Choosing not to marry

Choosing to marry later

Marrying without intending to have

children

Increasing number of working women

Increasing number of stay-at-home dads

DEMOGRAPHIC TRENDS:
GEOGRAPHIC POPULATION

Move from rural to Change in where people work

metropolitan areas
Telecommuting
Home office
 Education shapes one’s
DEMOGRAPHIC mentality and cognitive
TRENDS: ability
EDUCATIONAL
CHARACTERISTICS

Influence the income level in

the society
WHICH GENERATION ARE
YOU ?
MACRO ENVIRONMENT
FACTOR : ECONOMIC
FACTOR
PURCHASING POWER
Value of a currency expressed in terms of the amount of
goods or services that one unit of money can buy.
MACRO ENVIRONMENT
FACTOR : ECONOMIC
FACTOR
INFLATION
the rate at which the average price level of a basket of selected goods and services in an economy
increases over a period of time.
It is the constant rise in the general level of prices where a unit of currency buys less than it did
in prior periods.
 MACRO ENVIRONMENT
FACTOR : ECONOMIC
FACTOR
RECESSIO
N
Recession is when the
economy declines
significantly for at least six
months.
There's a drop income,
employment, manufacturing,
and retail sales.  
MACRO ENVIRONMENT
FACTOR : TECHNOLOGY
Most dramatic force in
changing the marketplace

New products, new

opportunities

Concern for the safety of new

products
MACRO ENVIRONMENT
FACTOR : POLITICAL AND
LEGAL FACTOR
Political environment consists of laws, government agencies,
and pressure groups that influence or limit various
organizations and individuals in a given society
 This force can be divided into
General monetary and fiscal policies
Broad social legislation and policies set by regulatory agencies
Government relationship with industrial agencies
Laws affecting marketing itself
MACRO ENVIRONMENT
FACTOR : POLITICAL AND
LEGAL FACTOR
 EXAMPLES OF ADVERTISEMENTS
THAT ARE NOT PERMITTED BY THE
LAW IN MALAYSIA
COMPETITORS
How many competitors?

How big are competitors?

How interdependent is
the industry?
 COMPETITORS
• Competition for Market Share and Profits
Regardless of the form of the competitive market, as
population growth slows, costs rise, and available
resources tighten, firms find they must work harder to
maintain their profits and market share.

• Global Competition
More foreign firms entering the country, bringing
better product technology and better price
END OF CHAPTER 1