Chapter 1: Marketing Principles and Practice
1. Define the marketing concept
Marketing is a social and managerial process by which individuals/groups obtain what they need and
want through creating and exchanging products and value with others.
In business context: To build and maintain profitable customer relationships with stakeholders
__________________________________________________________________________________
Difference between Customers and Consumers:
customer purchases/obtains an offering (uber/airbnb)
>< a consumer(user) uses it (or eats it, in the case of food)
Initiator: Initiates idea
Influencer: Influences
Decider: Ultimate buying decision
Buyer: Actual purchase
Payer: Pays
User: Consumes
Gatekeeper: Controls access
important to know these roles bc : for example women buy deo for men so they don’t like ads that
say itll attract women etc
__________________________________________________________________________________
Market orientation
= The organization-wide generation of market intelligence
pertaining to current and future customer needs,
dissemination of the intelligence across the departments,
and organization-wide responsiveness to it’
try to predict current+future underlying needs of consumers
= Organisation-wide belief in delivering customer value
Understanding consumer needs even better than consumers themselves do
Creating products that meet existing and latent needs, now or in future
__________________________________________________________________________________
,3 components of market orientation
Developing a market orientation means developing:
custumor orientation :
concerned with creating superior value by continuously developing and redeveloping offerings
to meet customer needs, meaning that we should measure customer satisfaction on a
continuous basis and train front-line service staff;
competitor orientation
requiring an organization to develop an understanding of its competitors’ short-term strengths
and weaknesses, and its own long-term capabilities and strategies
interfunctional coordination
requiring all an organization’s functions to work together for long-term profit growth
→ market sensing : understanding strategic implications of the market and acting on info collected
through environmental scanning
__________________________________________________________________________________
,Marketing’s intellectual roots
Marketing as a discipline has developed as a result of the influence of its practitioners, but also
developments in several related disciplines :
Industrial economics influences:
matching supply and demand (price, quantity)
Theories of income distribution, scale of operation, monopoly, competition, …
Psychological influences
Consumer behaviour, motivation research, information processing
Persuasion, consumer personality, customer satisfaction, …
Sociological influences
How groups of people behave: Demographics, class, motivation, customs, culture
How communication passes through opinion leaders, …
Anthropological influences
Qualitative approaches in researching consumer behaviour
Computer science influences
Digitization, recommendation systems, apps, …
__________________________________________________________________________________
Differences between Sales and Marketing
long term satisfaction of customer needs >< short term ‘’
high focus on stimulation of demand >< focus on meeting existing demand only
greater input into customer design of offering (co creation) >< lesser input ‘’
, What do Marketers do?
Core competencies
= to generate customer insights
champion the customer and hence customer focus
and develop marketing strategy
Technical competencies:
risk + reputation management
product management
brand
integrated marketing communications
digital integration
monitoring and measuring effectiveness
customer experience
partnership marketing, including managing channel partners
Customer centricity is also…
NOT trying to please ALL customers
Fulfilling needs in a PROFITABLE way
a lot may have said no but they still make a lot of profit out of that 23 percent
__________________________________________________________________________________
2. Understand the concepts of exchange in marketing and the marketing mix
Exchange = the act of obtaining a desired object from someone by offering something in return
• At least two parties
• Each must hold something of value to offer
• Parties must want to deal with each other
→ Exchange creates value, gives people more consumption choices or possibilities
Customer value: the consumer’s assessment of the product’s overall capacity to satisfy their
needs
perceived value: price
>< economists: maximise utility, focus on functional value
e.g. Tesla (expensive) / cola for thirst wont work
benefits : saves on gas
cost : low range
calculate how many km u would have to drive to
recover the extra cost
→ but also other fun gadgets and popularity
1. Define the marketing concept
Marketing is a social and managerial process by which individuals/groups obtain what they need and
want through creating and exchanging products and value with others.
In business context: To build and maintain profitable customer relationships with stakeholders
__________________________________________________________________________________
Difference between Customers and Consumers:
customer purchases/obtains an offering (uber/airbnb)
>< a consumer(user) uses it (or eats it, in the case of food)
Initiator: Initiates idea
Influencer: Influences
Decider: Ultimate buying decision
Buyer: Actual purchase
Payer: Pays
User: Consumes
Gatekeeper: Controls access
important to know these roles bc : for example women buy deo for men so they don’t like ads that
say itll attract women etc
__________________________________________________________________________________
Market orientation
= The organization-wide generation of market intelligence
pertaining to current and future customer needs,
dissemination of the intelligence across the departments,
and organization-wide responsiveness to it’
try to predict current+future underlying needs of consumers
= Organisation-wide belief in delivering customer value
Understanding consumer needs even better than consumers themselves do
Creating products that meet existing and latent needs, now or in future
__________________________________________________________________________________
,3 components of market orientation
Developing a market orientation means developing:
custumor orientation :
concerned with creating superior value by continuously developing and redeveloping offerings
to meet customer needs, meaning that we should measure customer satisfaction on a
continuous basis and train front-line service staff;
competitor orientation
requiring an organization to develop an understanding of its competitors’ short-term strengths
and weaknesses, and its own long-term capabilities and strategies
interfunctional coordination
requiring all an organization’s functions to work together for long-term profit growth
→ market sensing : understanding strategic implications of the market and acting on info collected
through environmental scanning
__________________________________________________________________________________
,Marketing’s intellectual roots
Marketing as a discipline has developed as a result of the influence of its practitioners, but also
developments in several related disciplines :
Industrial economics influences:
matching supply and demand (price, quantity)
Theories of income distribution, scale of operation, monopoly, competition, …
Psychological influences
Consumer behaviour, motivation research, information processing
Persuasion, consumer personality, customer satisfaction, …
Sociological influences
How groups of people behave: Demographics, class, motivation, customs, culture
How communication passes through opinion leaders, …
Anthropological influences
Qualitative approaches in researching consumer behaviour
Computer science influences
Digitization, recommendation systems, apps, …
__________________________________________________________________________________
Differences between Sales and Marketing
long term satisfaction of customer needs >< short term ‘’
high focus on stimulation of demand >< focus on meeting existing demand only
greater input into customer design of offering (co creation) >< lesser input ‘’
, What do Marketers do?
Core competencies
= to generate customer insights
champion the customer and hence customer focus
and develop marketing strategy
Technical competencies:
risk + reputation management
product management
brand
integrated marketing communications
digital integration
monitoring and measuring effectiveness
customer experience
partnership marketing, including managing channel partners
Customer centricity is also…
NOT trying to please ALL customers
Fulfilling needs in a PROFITABLE way
a lot may have said no but they still make a lot of profit out of that 23 percent
__________________________________________________________________________________
2. Understand the concepts of exchange in marketing and the marketing mix
Exchange = the act of obtaining a desired object from someone by offering something in return
• At least two parties
• Each must hold something of value to offer
• Parties must want to deal with each other
→ Exchange creates value, gives people more consumption choices or possibilities
Customer value: the consumer’s assessment of the product’s overall capacity to satisfy their
needs
perceived value: price
>< economists: maximise utility, focus on functional value
e.g. Tesla (expensive) / cola for thirst wont work
benefits : saves on gas
cost : low range
calculate how many km u would have to drive to
recover the extra cost
→ but also other fun gadgets and popularity
