chapter 2 basic marketing concepts1 marketing essentials chaper 2: the marketing concept
DESCRIPTION
Chapter 2 Basic Marketing Concepts3 The Marketing Concept The marketing concept states that businesses must satisfy customers ' needs and wants in order to make a profit. The Basic ConceptTRANSCRIPT
Chapter 2 Basic Marketing Concepts 1
Marketing Essentials
Chaper 2: The Marketing Concept
Chapter 2 Basic Marketing Concepts
SECTION 2.1
What You'll Learn
The marketing concept
The difference between customers and consumers
What a market is and how it can be described
The four Ps of the marketing mix
The Marketing Concept
Chapter 2 Basic Marketing Concepts 3
The Marketing Concept
The marketing concept states that businesses must satisfy customers' needs and wants in order to make a profit.
The Basic Concept
Chapter 2 Basic Marketing Concepts 4
Customers buy a product.
Consumers use the product. Example: Parents who buy video games
from retailers are customers. The kids who play the video games are the consumers.
Example: Baby formula: Consumer? Customer?
Customers vs. Consumers
Chapter 2 Basic Marketing Concepts 5
A market is all potential customers who share common needs and wants and who have the ability and willingness to buy the product.
Could be the: Young, old, male, female, poor, rich, jock, etc…….. A combination or just one.
What is a Market?
Chapter 2 Basic Marketing Concepts 6
The marketing mix comprises four basic marketing strategies known as the four Ps:
The Marketing Mix
Product Place Price Promotion
Slide 1 of 3
Chapter 2 Basic Marketing Concepts 7
The Marketing MixProduct strategies include what product to make, how to package it, what brand name to use, and what image to project.
Place strategies deal with how and where a product will be distributed.
Slide 2 of 3
Price strategies should reflect what customers are willing and able to pay.
Promotion strategies deal with how potential customers will be told about the new product, what the message will be, when and where it will be delivered, and with what inducements to buy.
Chapter 2 Basic Marketing Concepts
The Marketing Mix
• Product, Place, Price, PromotionLet’s think of some products/services that are
trending NOW…
What would be the marketing mix for…
8
Chapter 2 Basic Marketing Concepts 9
SECTION 2.1 The Marketing Concept
Target marketing is focusing all marketing mix decisions on the specific group of people you want to reach.
Target Marketing
Chapter 2 Basic Marketing Concepts 10
Thinking Critically
Many women's magazines like Glamour and Elle publish advertisement for men's cologne. Explain the rationale for this practice.
Chapter 2 Basic Marketing Concepts 11
2.1 ASSESSMENT
Reviewing Key Terms and Concepts1. What does the marketing concept state?
2. Who are the customers of Sony Electronics
and Hershey Chocolates? Who are their
consumers?
3. What is a market?
4. What is target marketing?
5. What are the four Ps of the marketing mix?
Chapter 2 Basic Marketing Concepts 12
Dividing the total market into smaller groups of people who share specific needs and characteristics is the essence of market segmentation.
Market Segmentation
Chapter 2 Basic Marketing Concepts 13
Market Segmentation
Businesses may segment a market by:
Analyzing Markets
demographics
psychographics
geographics
product benefits
Chapter 2 Basic Marketing Concepts 14
Demographics refers to statistics that describe a population in terms of personal characteristics. These include:
Demographics
age
gender
income
ethnic background
Chapter 2 Basic Marketing Concepts 15
When marketers study age, they classify everyone according to certain generations, because each generation tends to have shared experiences and common bonds.
See chart in your notes! You will be using these throughout the semester.What will the next generation be called? Here are some experts thoughts: Digital Natives, Generation Like and the Selfie Generation
Demographics: Age
Chapter 2 Basic Marketing Concepts 16
Companies can expand their markets by marketing to the other gender, or by marketing their products differently to men and women. Example: Jockey entered the women’s market with Jockey underwear for women and doubled its sales.
Demographics: Gender
Chapter 2 Basic Marketing Concepts 17
Marketers want to know how much money is available for spending on different products. They look at two types of income measurement:
Demographics: Income
disposable income discretionary income
Slide 1 of 2
Chapter 2 Basic Marketing Concepts 18
Disposable Income = money left over after taxes. Important for companies that produce and distribute necessities
Discretionary Income = money left after paying for food, shelter, and clothing. Important for companies that produce and distribute luxury items
Demographics: Income
Slide 2 of 2
Chapter 2 Basic Marketing Concepts 19
Marketers often segment the market by ethnicity. The three largest ethnic groups within the United States are African-Americans, Hispanics, and Asian-Americans. These three groups will account for 33 percent of the U.S. population in 2005.
Demographics: Ethnicity
Chapter 2 Basic Marketing Concepts 20
Census 2000
The United States conducts a census every ten years to determine the characteristics of the population. Which ethnic group is declining? Which ethnic groups are increasing? What effects will these ethnic changes have on marketing in the United States?
Chapter 2 Basic Marketing Concepts 21
Psychographics involves studies of consumers based on social and psychological characteristics.
In addition to segmenting people by their leisure time interests, marketers observe trends and changes in households, the economy, politics, and the workplace.
Psychographics
Chapter 2 Basic Marketing Concepts 22
Geographics refers to segmentation of the market based on where people live. Marketers study geographics in relation to:
Geographics
ethnic concentrations age ethnic background income
Chapter 2 Basic Marketing Concepts 23
Segmenting a market by product benefits involves studying consumers' needs and wants.
Product Benefits
Example: Different shampoos are marketed to people with different hair care needs.
Chapter 2 Basic Marketing Concepts 24
Thinking critically
How can Procter and Gamble market household products to a male market segment?What problems might P&G encounter in that endeavor?
Chapter 2 Basic Marketing Concepts
Top 10 Trending Products of 2015
• What would be the market for these products that are trending?
• Here's the link of the top 10 trending in 2015
25
Chapter 2 Basic Marketing Concepts 26
2.2 ASSESSMENT
Reviewing Key Terms and Concepts1. What do demographics, psychographics, geographics, and product benefits have in common?2. How can a market be segmented using demographics?3. What does the study of psychographics involve?
Slide 1 of 2
Chapter 2 Basic Marketing Concepts 27
2.2 ASSESSMENT
Reviewing Key Terms and Concepts
4. Provide one example of how a marketer can segment a market based on product benefits.
5. Of what significance are the combined African-American, Hispanic, and Asian-American populations to marketers?
Slide 2 of 2