Chapter 4
The Basics of Marketing
What do you think is meant by
the ad’s headline?
This is a
photograph of
Hong Kong.
 VISA is attempting
to attract
customers who do
business globally.
 This says VISA is an
accepted payment
worldwide.

2
Marketing Has Changed







Marketing has changed a great deal from the way it was used by
businesses many years ago.
The earliest use of marketing was to move products from the
producer to the consumer.
Marketing has become more effective because it is integrated into
other business activities.
When marketing is integrated, it is considered an essential part of
the business, and it is involved in all important business decisions.
Most marketing strategies today are developed as a result of
business opportunities, not problems.
Market opportunities include new markets and ways to improve a
company’s offerings in current markets.
In the past, many businesses reduced marketing efforts when faced
with financial problems.
What Does Marketing Mean to a Business?
The primary focus of the business should be on the
customer’s needs and wants, this is called the
marketing concept.
 Businesses that have adopted the marketing concept
use a totally new approach to thinking and planning –
they study the market.
 A business takes a big risk when it is unwilling to study
the needs of its customers.
 Today’s marketers are continuously looking for market
opportunities.
 Without the marketing concept, a business will develop
a product or service and then decide how to market
the product.

Putting Marketing Up Front






Strategy is planning that identifies how a company
expects to achieve its goals.
It is important to remember that various groups of
customers may have different needs.
Marketing and product planning should occur at the
same time.
Most of today’s consumers are very well informed, they
know what they want.
Businesses that are not prepared for competition have a
difficult time staying in the market.
A business that believes in the marketing concept
focuses its business planning on satisfying the needs and
wants of customers.
How Does the Marketing Concept
Affect Planning?

Businesses need to place the correct emphasis, not necessarily the same
amount, on each of the four marketing mix elements.

Producers and manufacturers do not sell directly to final consumers, but
they must also understand and respond to consumer needs.

Producers and manufacturers need to be concerned about the needs of
other businesses in the channel of distribution – all businesses that move
products from producer to consumer.

Channel members are the businesses used to provide many marketing
functions during the distribution process.

Examples of channel members include producers, retailers, and wholesalers.
The retailer usually makes the final pricing decisions.

Customers will blame all channel members if a product does not meet their
needs.

Most service businesses do not use a channel of distribution.

Distribution planning is important to service businesses because the service
must be available where and when the customer wants it.
6
Combining Parts of the Marketing Mix





Product that offers
choices
Distribution /Place
that provides
convenience
Price that gives value
Promotion that aids
decision-making
Satisfied customers
Customers do not always want the lowest price. Many are
looking for the best value!
Consumer Decision Making





Consumers make decisions every day.
A decision is a choice among alternatives.
Customers are quite different from one another
and they select products and services to meet
their unique needs.
A market segment is a group of similar
consumers within a larger market.
A market opportunity analysis studies and
prioritizes market segments to located the best
potential market based on demand and
competition.
Consumer Decision-Making Stages
Consumers make a series of decisions
when deciding on a purchase.
◦
◦
◦
◦
◦
Recognize a need
Identify alternatives
Evaluate choices
Make a decision
Assess satisfaction
Non-Business Organizations
Primary focus is on something other than
providing products and service for a profit.
 Examples

◦
◦
◦
◦
◦
Government agencies
Churches
Schools
Museums
Professional organizations
10
Non-Business Organizations
Nonprofit organizations should also be
concerned about marketing, it will help them
better satisfy their target market.
 A target market is a clearly defined segment of
the market which a business or non-profit
organization wants to appeal to.

Target marketing is focusing
all marketing mix decisions
on the specific group of
people you want to reach.
Professional Golfing

Describe the target market for a
professional golfing event.
12
Professional Rodeo

Describe the target
market for a professional
rodeo event.
13
Video: NASCAR

Describe the target market for a NASCAR event.
14
Chapter 6
Marketing Starts
With Customers
Why Study Consumer Behavior?
Marketing begins with customers.
 To effectively implement the marketing
concept, marketers must understand consumer
behavior.


Understanding
consumer
behavior will
help marketers
make sure their
products and
services match
customer
needs.
16
Understanding Consumer Behavior
Consumer behavior is the study of
consumers and how they make decisions.
 Final consumers buy products or services
for personal use. Sometimes called the
final customer.
 Business consumers buy goods and
services to produce and market other
goods and services or for resale.

Frameworks 5.2
17
Consumers’ Wants & Needs

A want is an unfulfilled desire.
◦ Products purchased to satisfy a want are not
essential for living, but needed to maintain a
certain lifestyle.
◦ A non-economic want is a desire that cannot
be satisfied with a purchase. An example of a
non-economic want is friendship.

A need is anything you require to live.
Food, clothing, shelter, and water are
considered needs.
Frameworks 5.2.1
18
Consumers’ Wants & Needs
Is the desire to have
the newest cell phone
a need or a want?
Four out of five teens (17
million) carry a wireless
device. This is a 40% increase
since 2004.
Frameworks 5.2
19
Abraham Maslow
This American physiologist studied
needs and determined that people
satisfy their needs in a rank order
(known as a hierarchy) with lower
level needs being satisfied first.
1908-1970
Maslow said that people are on different levels of his
hierarchy. Some people feel safety needs as more
important to them, than social or esteem needs.
Maslow’s needs include: Physiological, Security,
Social, Esteem, and Self-Actualization
20
Maslow’s Hierarchy of Needs
Self-Actualization
(to realize your potential)
Esteem
(respect and recognition)
Social
(friends, love, belonging)
Security
(physical safety and economic security)
Physiological
(food, sleep, water, shelter, air)
21
Physiological Needs
food, sleep, water, shelter, air
Queen Bed Sets Starting at: $2,599.98
Sale Price: $2,399.98
22
Security Needs
physical safety and economic security
23
Social Needs
friends, love, belonging
“At the Arizona Country Club, members become
friends for a lifetime and families share
experiences that are cherished for generations.
Our commitment to creating a lasting impression
is the reason we have earned the distinction for
being one of the friendliest country clubs in the
Southwest.”
24
Esteem Needs
respect and recognition
25
Self Actualization Needs
to realize your potential
26
What Motivates Buyers?
All of our actions are influenced by
motivation.
 Motivation is the set of positive or
negative factors that direct individual
behavior. Frameworks 5.3.1

27
What Motivates Buyers?

Buying motives are the reasons that
you buy.
◦ Emotional motives are reasons to purchase
based on feelings, beliefs, or attitudes.
◦ Rational motives are reasons to buy based
on facts or logic.
◦ Patronage motives are based on loyalty to
a particular company or brand.
Frameworks 5.3.1
28
Emotional Motives
love, affection, guilt, status, fear
Frameworks 5.3.1
29
Emotional Motives
love, affection, guilt, status, fear
30
Emotional Motives
love, affection, guilt, status, fear
31
Emotional Motives
love, affection, guilt, status, fear
Senior citizen above receives
a flu shoot. Why?
Advertiser know that fear
is a very strong motive.
32
Rational Motives
Reasons for buying are based on logic or
facts.
 Includes factors such as saving money or
obtaining the highest quality or greatest
value.
 Virtually all buyers have a combination of
rational and emotional motive.

Frameworks 5.3.1
33
Patronage Motives
If you shop in the same store time after
time, your motivation for choosing the
business is a patronage motive – loyalty.
 Business people are much less likely than
final consumers to base purchases on
patronage motives.

34
The Consumer Decision-Making Process
Buying Behavior is the decision processes
and actions of consumers as they buy
services and products.
 The Consumer Decision-Making Process
is the process by which consumers collect
and analyze information to make choices
among alternatives.

35
The Consumer
Decision-Making Process
Postpurchase
Evaluation
Purchase
5 Steps
Alternative
Evaluation
Information
Search
Problem
Recognition
36
The Consumer Decision-Making Process
The first step is problem recognition.
Problem
Recognition
37
The Consumer
Decision-Making Process
Information
Search
38
Alternative
Evaluation
39
The Consumer Decision-Making Process
Purchase
40
The Consumer
Decision-Making Process
Postpurchase
Evaluation
Did the product you purchased
fulfill your need.
A help line telephone number is
often provided by companies to
encourage satisfaction after the
purchase.
Membership in an owner’s
association may be provided.
1-800-BUTTERBALL
41
Influences on Buying Decisions
Personal identity is the characteristics and
character that make a person unique. This
includes personality, gender, ethnicity,
and age.
 Personality is an enduring pattern of
emotions and behaviors that define an
individual.
 Attitude is a frame of mind developed
from a person’s values, beliefs, and
feelings.

42
Influences on Buying Decisions





Self-concept is an individual’s belief about his or
her identity, image, and capabilities.
Lifestyle is the way a person lives as reflected by
material goods, activities, and relationships.
Gender also influences many decisions and
actions.
Ethnicity is a set of characteristics based on
ancestry, country of origin, language, or
traditions.
Age is also has a major influence on consumer
behavior.
43
Cultural and Social Environment
Culture is the history, beliefs, customs, and
traditions of a group.
 A reference group is a group of people or an
organization that an individual admires, identifies
with, and wants to be part of.

44
Cultural and Social Environment

Your reference group has an important influence on
much of your behavior and image.
45
Video: Too Many
Men In China
What happens to the culture of a
society when the government
inadvertently causes an imbalance in
the number of men to women?
No one knows … this situation
has never happened before.
Types of Decision-Making
Routine decision making is used for
purchases that are made frequently and
do not require much thought.
 Limited decision making takes more time
and is associated with a more expensive
product that is bought les frequently.
 Extensive decision making is done for
very expensive products and all 5 steps of
the decision making process will be used.

Frameworks 8.6
47
Types of Decision-Making

Routine decision making
Frameworks 8.6
48
Types of Decision-Making

Limited decision making
Frameworks 8.6
49
Types of Decision-Making

Extensive decision making
Frameworks 8.6
50
Marketers’ Response
Marketers will have the greatest
opportunity to explain the benefits of
their products and services and how they
can satisfy consumer needs when the
customer uses extensive decision making.
 The appropriate role of marketers in
consumer decision making is to match
their products and services to the needs
and expectations of customers.

51
Test
52