The Marketing Functions

1. The Marketing Functions • Market Planning - identifying and understanding markets. • Product & Service Management – design and development of products/services that will satisfy customer needs. • Distribution – getting products/services to customers. Includes determining the best procedure to be used so prospective customers can locate a product. • Pricing – establishing the value of products/services. • Promotion – communicating information to customers to inform, persuade, or remind them about a company or its products. • Selling – direct, personal, and persuasive communication with customers. • Market-Information Management – obtaining, managing, and using market and customer information. • Financing – budgeting for the business and providing financial assistance to customers. • Risk Management – providing security for products, buildings, equipment, inventory, employees, and customers.

2. The Need for Marketing • Good products will not be successful without good marketing. • Customers will not buy good products they’ve never heard of, can’t find, can’t afford, don’t understand, don’t know they need, or simply don’t want! • Marketing activities must be carefully planned and coordinated with other business activities.

3. The Need for Marketing "If a man can write a better book, preach a better sermon, or make a better mousetrap, than his neighbor, though he build his house in the woods, the world will make a beaten path to his door." - Ralph Waldo Emerson Often misquoted as: "Build a better mousetrap and the world will beat a path to your door." 1803 – 1882 American philosopher and poet.

4. Which is the better mousetrap? The product must be what the customer wants! But there are some things that customers just will not buy!

5. The Development of Marketing in Business • Today, no person or country is self-sufficient. • We all rely on other people for things we need and want. • To be self-sufficient people would have to over-come the need for a variety of goods and services.

6. The Development of Marketing in Business Bartering, exchanging products/services with others by agreeing on their value, without using money, was used before the development of a money system.

7. The Development of Marketing in Business • Currency was developed as a medium of exchange to make buying and selling easier, and because people began to specialize in performing certain jobs.

8. Video Presentation The U.S. Monetary System The U.S. Mint is in a bind: should it continue to produce pennies and nickels whose metal content is worth more than their face value? Morley Safer reports.

9. The Development of Marketing in Business • With this specialization of labor, people made more products and had more money. This created a need for central markets.

10. Central Markets were located where people frequently traveled or gathered. The Forum was the central marketplace and business center of ancient Rome. Visitors went here to do their banking, trading, and shopping. Elaborate temples and public buildings were also a part of the Forum. Frameworks 2.1

11. The Mall of America Bloomington, Minnesota Cost to build - $650 million Store front footage - 4.3 miles 4.2 million square feet Employees 13,000 Parking spaces - 12,550 Attractions The Park at MOA Underwater Adventures Aquarium LEGO Imagination Center Dinosaur Walk Museum A.C.E.S. Flight Simulation

12. More than 520 stores Sit-down restaurants - 20 Fast food restaurants - 30 Specialty food stores - 36 Movie screens – 14 Wedding Chapels - 1

13. The Branson Landing / Promenade

14. The Functions of Business • Production – Obtains or creates products or services for sale. • Operations – Support the primary function of the business and keep the business operating efficiently. Buildings and equipment must be maintained. Products must be obtained, transported, and stored. Paperwork and computerized records must be prepared and obtained. • Accounting & Finance – Planning and managing the resources and records of a business. • Management – Developing, implementing, and evaluating the plans and activities of a business. • Marketing – All business must communicate with customers and make their products/services available to ensure satisfying exchanges.

15. The Functions of Business Production – forms of production: • Processing raw materials into something useful – oil refineries and paper mills. • Agriculture – Growing food for consumption. • Manufacturing – Automobiles and computers are manufactured. • Services – Preparing a tax return, seeing a doctor, dentist, or getting a hair cut. • Merchandising – Buying an assortment of products (made by others) for resale to consumers. Examples include retailers and wholesalers.

16. Coordination of Business Functions • Each of the functions of an effective business depends on the other functions. • Products can be produced, but if the company is not operated or managed well, adequate records are not maintained, or marketing is ineffective, the products will not be sold at a profit.

17. Understanding the Marketing Concept • The Marketing Concept is using the needs of customers as the primary focus during the planning, production, pricing, distribution, and promotion of a product or service. • The Marketing Concept is a company wide consumer orientation. Frameworks 2.4

18. Implementing the Marketing Concept Identify needs of customers Develop and market products or services Operate a business profitably Frameworks 2.4.1

19. Getting the Word Out – Page 20 • After The Sale Follow-up. Making contact with the customer after the sale with a letter, phone call, or e-mail. • Recognition And Special Services. Recognizing purchasers in promotions, newsletters, or at events. • Incentives. Offering purchasers financial incentives or discounts for recommending the business to prospective customers. • Buzz Marketing. (AKA – Viral Marketing) Using high profile entertainment or news to get people to talk about their brand. • Product Seeding. Placing the right product in the right hands at the right time and providing information or samples to influential individuals. • Conversation Creation. (AKA – Viral Marketing) Developing interest or fun advertising, e-mails, catch phrases, entertainment, or promotions designed to start word of mouth activity.

20. Viral Marketing Marketing that facilitates and encourages people to pass along a marketing message. Viral marketing depends on a high pass-along rate from person to person. If a large percentage of recipients forward something to a large number of friends, the overall growth snowballs very quickly. If the pass-along numbers get too low, the overall growth quickly fizzles. A lot like “word-of-mouth.”

21. Product Seeding At last year's Academy Awards, for example, one of two Best Actress gift-bags featured Gucci sunglasses, a Sprint PCS phone, Christian Tse 18-carat gold Iris earrings, and more. The Best Actor bag featured Gucci eyewear, a Maurice Lacroix Swiss watch and assorted other goodies. According to news reports, the retail value of one such group of bags at the Oscars exceeded $110,000 each! Jessica Alba wearing free Gucci sunglasses

22. Product Seeding Energy Brands, makers of the Glaceau Vitamin Water line, discovered product seeding in 2004. As a result of its long-time strategy to "home deliver" the vitamin-enhanced drink to celebrities (including Sean "Puffy" Combs and Tom Cruise), the company gained a fan in 50 Cent. Having mentioned his preference for the product in a series of interviews, the Hip Hop star - who is well known for his fitness-centered lifestyle - became an obvious choice for brand spokesperson. Jennifer Aniston with her “seeded” bottle of water.

23. Guerrilla Marketing achieving conventional goals, such as profits … with unconventional methods, such as investing energy instead of money.

24. Guerrilla Marketing Sean Stevens (left) and Peter Berdovsky found something amusing during their arraignment inside Charlestown District Court. Months later, Berdovsky (left) and Stevens showed much more remorse, acknowledged their roles, and apologized.

25. Guerrilla Marketing

27. Implementing the Marketing Concept • The first step is to identify the market the company wants to serve. • A market is a description of a unique group of prospective customers a business wants to serve and their location. • A market is all potential customers who share common needs and wants and who have the ability and willingness to buy the product.

28. The Marketing Mix • The second step is to develop a marketing mix that will meet the needs of the market and provide a profit for the business. • The 4 elements of the Marketing Mix: • Product • Distribution or place • Price • Promotion (Also known as the 4 P’s of Marketing.) Frameworks 2.3

29. Video Presentation

30. The Marketing Mix • Product – anything offered to a market by the business to satisfy needs, could include physical products, services, or ideas. • Distribution or place – includes the location and methods used to make the product available to the consumer. Determining the best procedure to be used so prospective customers can locate a product. • Price – the amount the customer will pay for the product. • Promotion – includes the methods used and the information communicated to encourage customers to purchase and increase their satisfaction. Frameworks 2.3.1

31. Production Emphasis Companies make decisions about what and how to produce products and services without worrying about marketing. “They can have it in any color they want, as long as its black.”Henry Ford

32. The Sales Emphasis Companies emphasized widespread distribution and promotion in order to sell products and services.

33. Production Era Sales Era Marketing Department Era Marketing Concept Era 1900s–1920s 1930s–1940s • Emphasis on producing and distributing new products • Emphasis on using advertising and salespeople to convince customers to buy a company’s products 1950s–1960s 1970s–Today • Emphasis on developing many new marketing activities to sell products • Emphasis on satisfying customers’ needs with a carefully developed marketing mix

34. Improving the Marketing Concept Relationship Marketing – focuses on developing loyal customers who continue to purchase from the business for a long period of time.

35. Relationship Marketing Businesses must develop strategies that will encourage customers to return again and again! “Like A Good Neighbor, ______ ______ is There”

36. Employee Empowerment Employee empowerment is an approach to customer service that gives employees the authority to solve many customer problems. Requires that businesses trust employees to make good decisions in the best interests of the company and the customer.