Fundamental of

Marketing
MKT243
Chapter 1
Introduction

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 Topic Outline
• What Is Marketing?
• Understand the Marketplace and Customer
Needs
• Rules of Exchange
• Marketing Management Orientation/
Philosophies
• Differences between sales and market
orientation

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 What is Marketing?
• Marketing is a process by which
companies create value for customers and
build strong customer relationships to
capture value from customers in return
(Kotler. P & Armstong. G, 2008).
• Marketing is an organization function and
a set of processes for creating,
communicating, and delivering value to
customers and for managing customer
relationships in ways that benefit the
organization and the stakeholder.
(McDaniel, Lamb, Hair, 2008)

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 Understanding the Marketplace
and Customer Needs
Core Concepts
• Customer needs, wants, and
demands
• Market offerings
• Value and satisfaction
• Exchanges and relationships
• Markets

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Understanding the Marketplace
and Customer Needs
Customer Needs, Wants, and Demands

•States of deprivation

Needs •Physical—food, clothing, warmth, safety

•Social—belonging and affection
•Individual—knowledge and self-expression

Wants •Form that needs take as they are shaped by

culture and individual personality

Demands •Wants backed by buying power i.e. money

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Understanding the Marketplace
and Customer Needs
Markets are the set of actual
and potential buyers of a
product

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 Rules of exchange
• Five conditions must be satisfied for an exchange to
take place:

1. There must be at least two parties.

2. Each party has something that might be of value to the
other party.
3. Each party is capable of communication and delivery.
4. Each party is free to accept or reject the exchange
offer.
5. Each party believes it is appropriate or desirable to
deal with the other party.

• Exchange may not take place even if all of these

conditions exist, but these conditions are necessary for
exchange to be possible.

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 Production Concept
• The production orientation focuses
on internal capabilities of the firm
rather than on the desires and needs
of the marketplace. The firm is
concerned with what it does best,
based on its resources and
experience, rather than with what
consumers want.

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