CHAPTER OUTLINE

1
PowerPoint 1-4:
Marketing

I.

Define the term marketing

What Is Marketing?

A.

Marketing has two facets.

1.
2.

B.
PowerPoint 1-5:
American Marketing
Association Definition
of Marketing

PowerPoint 1-7:
Exchange

First, it is a philosophy, an attitude, a perspective, or a management

orientation that stresses customer satisfaction.
Second, marketing is an organization function and a set of processes
used to implement this philosophy.

The American Marketing Association definition of marketing focuses on

the second facet:
Marketing is the activity, set of institutions, and processes for creating,
communicating, delivering, and exchanging offerings that have values for
customers, clients, partners, and society at large.

C.

Research shows that companies that reward employees on a consistent

basis are those that perform best.

D.

The Concept of Exchange

The concept of exchange means that people give up something in order to
receive something that they would rather have.
1. The usual medium of exchange is money. Exchange can also be
through barter or trade of items or services.
2. Five conditions must be satisfied for an exchange to take place:
a.
b.
c.
d.
e.

PowerPoint 1-8:
Exchange

3.

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.

Exchange may not take place even if all of these conditions exist, but
these conditions are necessary for exchange to be possible.

2
PowerPoint 1-10:
The Four Marketing
Management
Philosophies

II.

Describe four marketing management philosophies

Marketing Management Philosophies
Four competing philosophies strongly influence an organizations marketing
activities. These philosophies are commonly referred to as production, sales,
market, and societal marketing orientations.
A.

PowerPoint 1-11:
Production Orientation

Production Orientation
The production orientation focuses on internal capabilities of the firm
rather than on the desires and needs of the marketplace. The firm is
concerned with what it does best, based on its resources and experience,
rather than with what consumers want.

B.
PowerPoint 1-12:
Sales Orientation

Sales Orientation
A sales orientation assumes that people will buy more goods and services
if aggressive sales techniques are used and that high sales result in high
profits.

C.

Market Orientation
1.

The marketing concept states that the social and economic

justification for an organization's existence is the satisfaction of
customer wants and needs while meeting organizational objectives.

2.

The marketing concept involves:

PowerPoint 1-13:
Market Orientation

a.

Focusing on customer wants and needs so the organization can

differentiate its product(s) from competitors' offerings

b.

Integrating all the organization's activities, including production,

to satisfy customer wants

a.

Achieving long-term goals for the organization by satisfying

customer wants and needs legally and responsibly.

3.

A market orientation is a philosophy that assumes that a sale does

not depend on an aggressive sales force but rather on a customers
decision to purchase a product; it is synonymous with the marketing
concept.

4.

Achieving a market orientation involves obtaining information about

customers, competitors, and markets; examining the information from
a total business perspective; determining how to deliver superior
customer value; and implementing actions to provide value to
customers.

5.

Understanding your competitive arena and competitor's strengths and

PowerPoint 1-14:
Achieving a Marketing
Orientation

weaknesses is a critical component of market orientation.

D. Societal Marketing Orientation
PowerPoint 1-15:
Societal Marketing

1.

The philosophy called the societal marketing orientation states that

an organization exists not only to satisfy customer wants and needs
and to meet organizational but also to preserve or enhance
individuals and society's long-term best interests.

2.

The American Marketing Association recognizes the importance of a

societal marketing orientation by including society at large as one
of the constituencies for which marketing seeks to provide value.

PowerPoint 1-16:
Questions that Help
Determine Marketing
Philosophy

3
PowerPoint 1-18:
Comparing Sales and
Market Orientations

Discuss the differences between sales and market

orientations

III. Differences Between Sales and Market Orientations

A.
PowerPoint 1-19:
The Organizations
Focus

B.

The Organization's Focus

1.

Sales-oriented firms tend to be inward looking. They focus on selling

what the organization makes rather than making what the customer
wants.

2.

Market-oriented firms derive their competitive advantage from an

external focus. Departments in these firms coordinate their activities
and focus on satisfying customers.

Customer Value
1. Customer value is the relationship between benefits and the sacrifice
necessary to obtain those benefits.
2. Creating customer value is not simply a matter of high quality or
pricing, but entails a combination of the two and other factors
3. Marketers interested in customer value:

PowerPoint 1-20:
Customer Value
Requirements

a.
b.
c.
d.
e.

Offer products that perform

Earn trust
Avoid unrealistic pricing
Give the buyer facts
Offer organization-wide commitment in service and after-sales
support
f. Offer co-creation
PowerPoint 1-21:
Customer Satisfaction

C.

Customer Satisfaction

Customer satisfaction is customers evaluation of a good or service in

terms of whether it has met their needs and expectations.
D.

Building Relationships

PowerPoint 1-22:
Relationship Marketing

Relationship marketing is a strategy that focuses on keeping and

improving relationships with current customers.

PowerPoint 1-23:
Building Relationships

Most successful relationship marketing strategies depend on customeroriented personnel, effective training programs, employees with authority
to make decisions and solve problems, and teamwork.

PowerPoint 1-24:
Defining a Firms
Business

E.

PowerPoint 1-25:
Knowing the Firms
Business

F.

The Firm's Business

1.

A sales-oriented firm defines its business in terms of the goods and

services it offers, like an encyclopedia publisher defining itself simply
as a book publisher/seller.

2.

A market-oriented firm defines its business based on the benefits

customers seek.

3.

Focusing on customer wants does not mean that customers will

always receive the specific goods and services they want.

Those To Whom the Product Is Directed

1.
2.

A sales-oriented organization targets its products at "everybody" or

"the average customer." However, few "average" customers exist.
The market-oriented firm
a.
b.
c.

G.

H.

Recognizes that different customer groups have different wants

Targets specific subgroups of customers
Designs special products and marketing programs for these
groups

The Firm's Primary Goal

1.

The goal of a sales-oriented firm is profitability through sales volume.

The focus is on making the sale rather than developing a long-term
relationship with a customer.

2.

The ultimate goal of most market-oriented organizations is to make a

profit from satisfying customers. Superior customer service enables a
firm to have large amounts of repeat business, customer loyalty, and
higher profit margins.

Tools the Organization Uses to Achieve Its Goals

1.

Sales-oriented firms seek to generate sales volume through intensive

promotional activities, mainly personal selling and advertising.

2.
PowerPoint 1-26:
Sales vs. Market
Orientations

Market-oriented organizations recognize that promotion is only one of

the four basic tools that comprise the marketing mix.
The tools are the marketing mix elements (the four P's): product,
place (distribution), promotion, and price.

3.

The important distinction is that market-oriented firms recognize that

each of the four components of the marketing mix is of equal
importance: sales-oriented organizations view promotion as the
primary means of achieving their goals.

Describe several reasons for studying marketing

IV. Why Study Marketing?

PowerPoint 1-28
Why Study Marketing?

A.

Marketing Plays an Important Role in Society

Marketing provides a delivery system for a complex standard of living. The
number of transactions needed everyday in order to feed, clothe, and
shelter a population the size of the one in the United States is enormous and
requires a sophisticated exchange mechanism.

B.

Marketing Is Important to Businesses

The fundamental objectives of most businesses are survival, profits, and
growth. Marketing contributes directly to achieving these objectives.
Marketing provides the following vital business activities:
1.
2.
3.
4.
5.

C.

D.

Assessing the wants and satisfactions of present and potential

customers
Designing and managing product offerings
Determining prices and pricing policies
Developing distribution strategies
Communicating with present and potential customers

Marketing Offers Outstanding Career Opportunities

1.

Between one-fourth and one-third of the entire civilian work force in

the United States performs marketing activities.

2.

Marketing offers career opportunities in areas such as professional

selling, marketing research, advertising, retail buying, distribution
management, product management, product development, and
wholesaling.

Marketing Affects Your Life Every Day

1.

As consumers of goods and services, we participate in the marketing

process every day.

2.

Almost 50 cents of every dollar consumers spend goes to pay

marketing costs such as market research, product research and
development, packaging, transportation, storage, advertising, and
sales-force expenses.