Introduction to Marketing Management chapter 01 Marketing in

Introduction to Marketing Management chapter 01 Marketing in Today’s Business Milieu chapter 02 ELEMENTS OF MARKETING STRATEGY AND PLANNING chapter 03 UNDERSTANDING THE GLOBAL MARKETPLACE: MARKETING WITHOUT BORDERS part ONE McGraw Hill/Irwin Copyright © The McGraw Hill Companies, Inc. All rights reserved

Information Drives Marketing Decision Making chapter 04 PERSPECTIVES ON CUSTOMER RELATIONSHIP MANAGEMENT chapter 05 MANAGING MARKETING INFORMATION chapter 06 UNDERSTANDING COMPETITORS: ANALYSIS TO ACTION chapter 07 UNDERSTANDING CUSTOMERS – BUSINESS TO CONSUMER MARKETS chapter 08 UNDERSTANDING CUSTOMERS – BUSINESS TO BUSINESS MARKETS part TWO McGraw Hill/Irwin Copyright © The McGraw Hill Companies, Inc. All rights reserved

Developing the Value Offering chapter 09 SEGMENTATION, TARGET MARKETING, AND POSITIONING chapter 10 THE PRODUCT EXPERIENCE – PRODUCT STRATEGY chapter 11 THE PRODUCT EXPERIENCE – BUILDING THE BRAND chapter 12 THE PRODUCT EXPERIENCE – NEW PRODUCT DEVELOPMENT chapter 13 UNDERSTANDING CUSTOMERS – BUSINESS TO BUSINESS MARKETS chapter 14 MANAGING PRICING DECISIONS part THREE McGraw Hill/Irwin Copyright © The McGraw Hill Companies, Inc. All rights reserved

Communicating and Delivering the Value Offering chapter 15 MANAGING MARKETING CHANNELS AND THE SUPPLY CHAIN chapter 16 POINTS OF CUSTOMER INTERFACE – BRICKS AND CLICKS chapter 17 INTEGRATED MARKETING COMMUNICATIONS: PROMOTIONAL STRATEGY, ADVERTISING, SALES PROMOTION, AND PUBLIC RELATIONS chapter 18 INTEGRATED MARKETING COMMUNICATIONS – PERSONAL SELLING, DIRECT AND INTERACTIVE MARKETING chapter 19 THE MARKETING DASHBOARD: METRICS FOR MEASURING MARKETING PERFORMANCE part FOUR McGraw Hill/Irwin Copyright © The McGraw Hill Companies, Inc. All rights reserved

Marketing in Today’s Business Milieu 01 McGraw Hill/Irwin Copyright © The McGraw Hill Companies, Inc. All rights reserved

Learning Objectives Identify typical misconceptions about marketing, why they persist, and the resulting challenges for marketing management Define what marketing and marketing management really are and how they contribute to firm success Appreciate how marketing has evolved from its early roots to be practiced as it is today Recognize the impact of key change drivers on the future of marketing McGraw Hill/Irwin Copyright © The McGraw Hill Companies, Inc. All rights reserved 6

WELCOME TO MARKETING MANAGEMENT Marketing is the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large. McGraw Hill/Irwin Copyright © The McGraw Hill Companies, Inc. All rights reserved 7 American Marketing Association, www.marketingpower.com, accessed May 17, 2008.

MARKETING MISCONCEPTIONS Catchy and entertaining advertisements Pushy salespeople Famous brands and their celebrity spokespeople Product claims that turn out to be overstated or just plain false Marketing departments “own” marketing initiative McGraw Hill/Irwin Copyright © The McGraw Hill Companies, Inc. All rights reserved 8

MARKETING MISCONCEPTIONS Marketing is all about advertising. Marketing is all about selling. Marketing is all about the sizzle. Marketing is inherently unethical and harmful to society. Only marketers market. Marketing is just another cost center in a firm. McGraw Hill/Irwin Copyright © The McGraw Hill Companies, Inc. All rights reserved 9

Behind the Misconceptions Marketing is Highly Visible by Nature Marketing is More Than Buzzwords McGraw Hill/Irwin Copyright © The McGraw Hill Companies, Inc. All rights reserved 10

Toward the Reality of Modern Marketing Marketing is a central function and set of processes essential to any enterprise. Leading and managing the facets of marketing is a core business activity. McGraw Hill/Irwin Copyright © The McGraw Hill Companies, Inc. All rights reserved 11

DEFINING MARKETING Peter Drucker, circa 1954 “There is only one valid definition of business purpose: to create a customer.” Peter Drucker, circa 1973 “Marketing is so basic that it cannot be considered a separate function (i.e., a separate skill or work) within the business...” McGraw Hill/Irwin Copyright © The McGraw Hill Companies, Inc. All rights reserved 12

DEFINING MARKETING AMA OFFICIAL DEFINITION - 1948; REAFFIRMED 1960 Marketing is the performance of business activities that direct the flow of goods and services from producers to consumers. McGraw Hill/Irwin Copyright © The McGraw Hill Companies, Inc. All rights reserved 13

DEFINING MARKETING AMA OFFICIAL DEFINITION - 1985 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. McGraw Hill/Irwin Copyright © The McGraw Hill Companies, Inc. All rights reserved 14

DEFINING MARKETING When compared to the earlier definitions of Marketing, the 2007 definition: Focuses on the more strategic aspects of marketing Recognizes marketing is not just a “department” in an organization Shifts the areas of central focus of marketing McGraw Hill/Irwin Copyright © The McGraw Hill Companies, Inc. All rights reserved 15

DEFINING MARKETING Marketing’s Stakeholders Societal Marketing Sustainability McGraw Hill/Irwin Copyright © The McGraw Hill Companies, Inc. All rights reserved 16

Core Marketing Concepts Value is the ratio of the bundle of benefits a customer receives from an offering compared to the costs incurred by the customer in acquiring that bundle of benefits. Exchange occurs when a person gives up something of value to them for something else they desire to have. McGraw Hill/Irwin Copyright © The McGraw Hill Companies, Inc. All rights reserved 17

For exchange to take place There must be at least two parties. Each party has something that might be of value to the other party. Each party is capable of communication and delivery. Each party is free to accept or reject the exchange offer. Each party believes it is appropriate or desirable to deal with the other party. McGraw Hill/Irwin Copyright © The McGraw Hill Companies, Inc. All rights reserved 18

MARKETING’S ROOTS AND EVOLUTION McGraw Hill/Irwin Copyright © The McGraw Hill Companies, Inc. All rights reserved 19

Beyond the Marketing Concept McGraw Hill/Irwin Copyright © The McGraw Hill Companies, Inc. All rights reserved 20

CHANGE DRIVERS IMPACTING THE FUTURE OF MARKETING Shift to product glut and customer shortage Shift in information power from marketer to customer Shift in generational values and preferences Shift to demanding return on marketing investment Shift to Marketing (“Big M”) and marketing (“little m”) McGraw Hill/Irwin Copyright © The McGraw Hill Companies, Inc. All rights reserved 21

Shift to product glut and customer shortage The balance of power is shifting between marketers and their customers, both in B2C and B2B markets. Not only is a customer orientation desirable, but also in today’s market it is a necessity for survival McGraw Hill/Irwin Copyright © The McGraw Hill Companies, Inc. All rights reserved 22

New Market Realities McGraw Hill/Irwin Copyright © The McGraw Hill Companies, Inc. All rights reserved 23

Shift in information power from marketer to customer Customers of all kinds have nearly limitless access to information about companies, products, competitors, other customers, and even detailed elements of marketing plans and strategies. McGraw Hill/Irwin Copyright © The McGraw Hill Companies, Inc. All rights reserved 24

Shift in generational values and preferences Impacts the firm’s message and the method by which that message is communicated. Impacts marketing in terms of human resources. Generational changes are nothing new. McGraw Hill/Irwin Copyright © The McGraw Hill Companies, Inc. All rights reserved 25

Shift to Distinguishing Marketing (“Big M”) and marketing (“little m”) Marketing (Big M) Strategic marketing, means a long-term, firm-level commitment to investing in marketing – supported at the highest organization level – for the purpose of enhancing organizational performance. marketing (little m) Tactical marketing, which serves the firm and its stakeholders at a functional or operational level. McGraw Hill/Irwin Copyright © The McGraw Hill Companies, Inc. All rights reserved 26

Shift to Justifying the Relevance and Payback of the Marketing Investment How can management effectively measure and assess the level of success a firm’s investment in various aspects of marketing has had. McGraw Hill/Irwin Copyright © The McGraw Hill Companies, Inc. All rights reserved 27

Marketing metrics McGraw Hill/Irwin Copyright © The McGraw Hill Companies, Inc. All rights reserved 28