1
CHAPTER
DEFINING MARKETING FOR
THE NEW REALITIES
LEARNING OBJECTIVES
In this chapter, we will address the following questions:
1. Why is marketing important?
2. What is the scope of marketing?
3. What are some core marketing concepts?
4. What forces are defining the new marketing realities?
5. What are the tasks necessary for successful marketing management?
EXECUTIVE SUMMARY
Marketing is the activity, set of institutions, and processes for creating, communicating,
and delivering value to customers and for managing customer relationships in ways that
benefit the organization and its stakeholders. Marketing management is the art and science of
choosing target markets and getting, keeping, and growing customers through creating,
delivering, and communicating superior customer value. Marketers can market goods,
services, events, experiences, persons, places, properties, organizations, information, and ideas
in four different marketplaces: consumer, business, global, and nonprofit.
Today’s marketplace is fundamentally different than in the past, resulting in many new
consumer and company capabilities. Technology, globalization, and social responsibility are
creating new opportunities and challenges and significantly changing the management or
marketing. Organizations can conduct business under the production concept, the product
concept, the selling concept, the marketing concept, or the holistic marketing concept. The
holistic marketing concept (including relationship marketing, integrated marketing, internal
marketing, and performance marketing) is based on the development, design, and
implementation of marketing programs, processes, and activities that recognize their
breadth and interdependencies. Successful marketing management includes developing
marketing strategies and plans, capturing marketing insights, connecting with customers,
building strong brands, creating, delivering, and communicating value, and managing the
marketing organization within the global economy.
OPENING THOUGHT
It is important to focus on how and why the traditional view of marketing has changed, and
to introduce the various ways of measuring performance, since they will reappear
throughout the text. Marketing applies to a variety of different areas and is increasingly
,involving many levels of the organization. Students who are not marketing majors may have
some difficulty accepting the encompassing role that marketing has on the other functional
disciplines within a firm. For those students who have never been exposed to marketing
and its components, the instructor’s challenge is to educate the students about the world of
marketing.
ASSIGNMENTS
In small groups, ask the students to review the annual report from Unilever. How do the
missions discussed in the opening vignette translate into their current business practices?
How are its marketing investments and initiatives affecting its profitability? What
conclusions can you draw from Unilever’s progress?
Students can choose a firm of their preference, interview key marketing management
members and ask the firm how they are reacting to the changes in marketing management
for the new realities.
Have the students read Adi Narayan’s “Marketers Aim New Ads at Video iPod Users,”
BloombergBusinessWeek April 17, 2014 (http://www.businessweek.com/articles/2014-04-
17/indias-mobile-marketers-try-phone-calls-to-reach-rural-consumers) and Suzanne
Vranica and Christopher S. Stewart’s “Mobile Advertising Begins to Take Off: Spending More
Than Doubled in the First Half,” Wall Street Journal, October 9, 2013 and comment on how
effective they believe cell phone advertisements will be in the future.
Have the students reflect upon their favorite product and/or service. Then have the
students collect marketing examples from each of these companies. This information should
be in the form of examples of printed advertising, copies of television commercials, Internet
advertising, or radio commercials. During class, have the students share what they have
collected with others. Questions to ask during the class discussion should focus on why this
particular example of advertising elicits a response from you. What do you like/dislike
about this marketing message? Does everyone in the class like/dislike this advertising?
DETAILED CHAPTER OUTLINE
I. The Value of Marketing
A. Marketing ability helps create sufficient demand for products and services,
, which is essential for a firm’s financial success, creates jobs and provides
resources for firms to engage is socially responsible activities.
B. Marketers that fail to carefully monitor their customers and competitors,
continuously improve their value offerings and marketing strategies, or satisfy
their employees, stockholders, suppliers, and channel partners in the process
are more vulnerable to competitive entry.
I. What is Marketing?
A. Marketing is about identifying and meeting human and social needs; “Meeting
needs profitably.”
B. American Marketing Association definition: 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.
C. Marketing management is the art and science of choosing target markets and
getting, keeping, and growing customers through creating, delivering, and
communicating superior customer value.
II. What is Marketed?
A. Goods: physical goods include food products, cars, refrigerators, televisions,
machines, and other mainstays of a modern economy.
B. Services: represent approximately 2/3 of the U.S. economy, including
airlines, hotels, maintenance and repair people, and accountants, bankers,
doctors, and management consultants.
C. Events: include time-based events, global and local events
D. Experiences: marketers orchestrate several services and goods to create, stage,
and market experiences.
E. Persons: include artists, musicians, CEOs, physicians, high-profile lawyers
and financiers, and other professionals often get help from marketers, and
each person has been advised to become a “brand.”
F. Places: include economic development specialists, real estate agents,
commercial banks, local business associations, and advertising and public
relations agencies.
G. Properties: intangible rights of ownership to either real property (real estate)
or financial property (stocks and bonds).
, H. Organizations: include museums, performing arts organizations, corporations,
and nonprofits that use marketing to boost their public images and compete
for audiences and funds.
I. Information: what books, schools, and universities produce, market, and
distribute at a price to parents, students, and communities.
J. Ideas: every market offering includes a basic idea. Products and services are
platforms for delivering some idea or benefit.
III. Who Markets?
A. A marketer is someone who seeks a response—attention, a purchase, a vote, a
donation—from another party, called the prospect
B. Marketers manage all possible touch points where a customer interacts with
the company
C. What is a Market?
D. A market is a collection of buyers and sellers who transact over a particular
product or product class (such as the housing market or the grain market)
E. Buyers and sellers are connected by four flows that include goods and
services, communication, money exchange, and information exchange
I. Needs, Wants, and Demands
A. Needs = basic human requirements
B. Wants = when needs are directed to specific objects that might satisfy the
need
C. Demands = wants for specific products backed by an ability to pay
D. Marketers do not create needs: Needs pre-exist marketers.
E. Five types of needs:
Stated needs
Real needs
Unstated needs
Delight needs
Secret needs
CHAPTER
DEFINING MARKETING FOR
THE NEW REALITIES
LEARNING OBJECTIVES
In this chapter, we will address the following questions:
1. Why is marketing important?
2. What is the scope of marketing?
3. What are some core marketing concepts?
4. What forces are defining the new marketing realities?
5. What are the tasks necessary for successful marketing management?
EXECUTIVE SUMMARY
Marketing is the activity, set of institutions, and processes for creating, communicating,
and delivering value to customers and for managing customer relationships in ways that
benefit the organization and its stakeholders. Marketing management is the art and science of
choosing target markets and getting, keeping, and growing customers through creating,
delivering, and communicating superior customer value. Marketers can market goods,
services, events, experiences, persons, places, properties, organizations, information, and ideas
in four different marketplaces: consumer, business, global, and nonprofit.
Today’s marketplace is fundamentally different than in the past, resulting in many new
consumer and company capabilities. Technology, globalization, and social responsibility are
creating new opportunities and challenges and significantly changing the management or
marketing. Organizations can conduct business under the production concept, the product
concept, the selling concept, the marketing concept, or the holistic marketing concept. The
holistic marketing concept (including relationship marketing, integrated marketing, internal
marketing, and performance marketing) is based on the development, design, and
implementation of marketing programs, processes, and activities that recognize their
breadth and interdependencies. Successful marketing management includes developing
marketing strategies and plans, capturing marketing insights, connecting with customers,
building strong brands, creating, delivering, and communicating value, and managing the
marketing organization within the global economy.
OPENING THOUGHT
It is important to focus on how and why the traditional view of marketing has changed, and
to introduce the various ways of measuring performance, since they will reappear
throughout the text. Marketing applies to a variety of different areas and is increasingly
,involving many levels of the organization. Students who are not marketing majors may have
some difficulty accepting the encompassing role that marketing has on the other functional
disciplines within a firm. For those students who have never been exposed to marketing
and its components, the instructor’s challenge is to educate the students about the world of
marketing.
ASSIGNMENTS
In small groups, ask the students to review the annual report from Unilever. How do the
missions discussed in the opening vignette translate into their current business practices?
How are its marketing investments and initiatives affecting its profitability? What
conclusions can you draw from Unilever’s progress?
Students can choose a firm of their preference, interview key marketing management
members and ask the firm how they are reacting to the changes in marketing management
for the new realities.
Have the students read Adi Narayan’s “Marketers Aim New Ads at Video iPod Users,”
BloombergBusinessWeek April 17, 2014 (http://www.businessweek.com/articles/2014-04-
17/indias-mobile-marketers-try-phone-calls-to-reach-rural-consumers) and Suzanne
Vranica and Christopher S. Stewart’s “Mobile Advertising Begins to Take Off: Spending More
Than Doubled in the First Half,” Wall Street Journal, October 9, 2013 and comment on how
effective they believe cell phone advertisements will be in the future.
Have the students reflect upon their favorite product and/or service. Then have the
students collect marketing examples from each of these companies. This information should
be in the form of examples of printed advertising, copies of television commercials, Internet
advertising, or radio commercials. During class, have the students share what they have
collected with others. Questions to ask during the class discussion should focus on why this
particular example of advertising elicits a response from you. What do you like/dislike
about this marketing message? Does everyone in the class like/dislike this advertising?
DETAILED CHAPTER OUTLINE
I. The Value of Marketing
A. Marketing ability helps create sufficient demand for products and services,
, which is essential for a firm’s financial success, creates jobs and provides
resources for firms to engage is socially responsible activities.
B. Marketers that fail to carefully monitor their customers and competitors,
continuously improve their value offerings and marketing strategies, or satisfy
their employees, stockholders, suppliers, and channel partners in the process
are more vulnerable to competitive entry.
I. What is Marketing?
A. Marketing is about identifying and meeting human and social needs; “Meeting
needs profitably.”
B. American Marketing Association definition: 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.
C. Marketing management is the art and science of choosing target markets and
getting, keeping, and growing customers through creating, delivering, and
communicating superior customer value.
II. What is Marketed?
A. Goods: physical goods include food products, cars, refrigerators, televisions,
machines, and other mainstays of a modern economy.
B. Services: represent approximately 2/3 of the U.S. economy, including
airlines, hotels, maintenance and repair people, and accountants, bankers,
doctors, and management consultants.
C. Events: include time-based events, global and local events
D. Experiences: marketers orchestrate several services and goods to create, stage,
and market experiences.
E. Persons: include artists, musicians, CEOs, physicians, high-profile lawyers
and financiers, and other professionals often get help from marketers, and
each person has been advised to become a “brand.”
F. Places: include economic development specialists, real estate agents,
commercial banks, local business associations, and advertising and public
relations agencies.
G. Properties: intangible rights of ownership to either real property (real estate)
or financial property (stocks and bonds).
, H. Organizations: include museums, performing arts organizations, corporations,
and nonprofits that use marketing to boost their public images and compete
for audiences and funds.
I. Information: what books, schools, and universities produce, market, and
distribute at a price to parents, students, and communities.
J. Ideas: every market offering includes a basic idea. Products and services are
platforms for delivering some idea or benefit.
III. Who Markets?
A. A marketer is someone who seeks a response—attention, a purchase, a vote, a
donation—from another party, called the prospect
B. Marketers manage all possible touch points where a customer interacts with
the company
C. What is a Market?
D. A market is a collection of buyers and sellers who transact over a particular
product or product class (such as the housing market or the grain market)
E. Buyers and sellers are connected by four flows that include goods and
services, communication, money exchange, and information exchange
I. Needs, Wants, and Demands
A. Needs = basic human requirements
B. Wants = when needs are directed to specific objects that might satisfy the
need
C. Demands = wants for specific products backed by an ability to pay
D. Marketers do not create needs: Needs pre-exist marketers.
E. Five types of needs:
Stated needs
Real needs
Unstated needs
Delight needs
Secret needs
