WHAT IS MARKETING?

Marketing is the activity, set of institutions, and processes for creating, capturing,
communicating, delivering, and exchanging offerings that have value for customers, clients,
partners, and society at large. Marketing strives to create value in many ways. If marketers are to
succeed, their customers must believe that the firm’s products and services are valuable; that is,
they are worth more to the customers than they cost. Another important and closely related
marketing role is to capture value of a product or service based on potential buyers’ beliefs about
its value. Marketers also enhance the value of products and services through various forms of
communication, such as advertising and personal selling. Through communications, marketers
educate and inform customers about the benefits of their products and services and thereby
increase their perceived value. Marketers facilitate the delivery of value by making sure the right
products and services are available when, where, and in the quantities their customers want.
Better marketers are not concerned about just one transaction with their customers. They
recognize the value of loyal customers and strive to develop long-term relationships with them.
Value represents the relationship of benefits to costs. Firms can improve their value by
increasing benefits, reducing costs, or both. The best firms integrate a value orientation into
everything they do. If an activity doesn’t increase benefits or reduce costs, it probably shouldn’t
occur. Firms become value driven by finding out as much as they can about their customers and
those customers’ needs and wants. They share this information with their partners, both up and
down the supply chain, so the entire chain collectively can focus on the customer. The key to
true value-based marketing is the ability to design products and services that achieve precisely
the right balance between benefits and costs. Value-based marketers aren’t necessarily worried
about how much money they will make on the next sale. Instead, they are concerned with
developing a lasting relationship with their customers so those customers return again and again.

 Marketing is about satisfying customer needs and wants. 

 Marketing entails an exchange. 
 Marketing requires product, price, place, and promotion decisions. 
 Product: Creating Value 
 Price: Capturing Value 
 Place: Delivering the Value Proposition 
 Promotion: Communicating the Value Proposition 
 Marketing can be performed by both individuals and organizations. 
 Marketing impacts various stakeholders. 
 Marketing helps create value. 

https://www.youtube.com/watch?v=kshIWIc15yg (Steve Jobs on marketing)

 The six key macroenvironmental factors
are culture, demographics, social issues,
technological advances, economic
situation, and political/regulatory
environment.
What are the chances that a fast-food
hamburger restaurant would be successful
in a predominantly Hindu neighborhood?
Not good. Marketers must be sensitive to
such cultural issues to be successful, and
they must also consider customer
demographics—age, income, market size,
education, gender, and ethnicity—to
identify specific customer target groups. In
any society, major social trends influence the way people live. In no other time in history has
technology moved so rapidly and had such a pervasive influence on the way we live. Not only
do marketers help identify and develop technologies for practical, everyday uses, but also
technological advances help marketers provide consumers with more products and services more
quickly and efficiently. The general state of the economy influences how people spend their
discretionary income. When the economy is healthy, marketing success comes relatively easily.
But when the economy gets bumpy, only well-honed marketing skills can yield long-term
successes. Naturally, all firms must abide by the law, and many legal issues affect marketing
directly. These laws pertain to competitive practices and protecting consumers from unfair or
dangerous products.
Customers, the company, competitors, and corporate partners affect marketing strategy
Everything a firm does should revolve around the customer; without the customer, nothing gets
sold. Firms must discover their customers’ wants and needs and then be able to provide a
valuable product or service that will satisfy those wants or needs. If there were only one firm and
many customers, a marketer’s life would be a piece of cake. But because this situation rarely
occurs, firms must monitor their competitors to discover how they might be appealing to their
customers. Without competitive intelligence, a firm’s customers might soon belong to its
competitors. Though life certainly would be easier without competitors, it would be difficult, if
not impossible, without corporate partners. Good marketing firms or departments work closely
with suppliers, marketing research firms, consultants, and transportation firms to coordinate the
extensive process of discovering what customers want and finally getting it to them when and
where they want it. Each of these activities—discovering customer needs, studying competitors’
actions, and working with corporate partners—helps add value to firms’ products and services.

Quiz 1:
1. Marketing concepts and techniques can only be applied in profit-oriented businesses. False
2. Your parents ask why you are taking a class in marketing and why it is important for your future. All
of the following are possible responses EXCEPT: Marketing is the only important business function
within for-profit firms.
((Understanding marketing helps make anyone a more educated consumer.; Marketing is
a viable career path offering many diverse opportunities for employment; Every business,
every organization and everyone uses marketing to establish their brand in the market;
The principles used in marketing are the same ones people apply when seeking
employment))
3. Customers may give up ___ in order to get (purchase) something they need or want. Money,
time, effort
4. Which of the following questions must be addressed when making marketing decisions? What
features should the product have?; What message should be used to promote the product?; What retailers
should be used to sell the product to the customer?; How much should the product cost?
5. Both ___ goods and ___ services require marketing to be successful. Tangible; intangible
6. _______ is communication via advertising, public relations, sales promotions, direct marketing,
online marketing and/or professional selling that is used to inform, persuade or remind the target
market of the benefits and value of a product. Promotion
7. It will be difficult, if not impossible, for a product to be successful if any of the elements of the
marketing mix are overlooked or poorly planned. True
8. Bill is planning on opening a clothing store selling apparel for men. He has signed exclusive
agreements with several major luxury manufacturers. These manufacturers have given him a
suggested retail price (MSRP) that his research with potential customers has confirmed is the right
price point. He has met with a local graphic design firm who will be developing displays, signs and
print ads to build awareness of his business. Based on this description, which element of the
marketing mix does Bill still need to work on? Place
9. The essence of ____ is that two people/entities will each give something of value to the other so that
both are satisfied with the transaction or relationship. The exchange process
10. Daniel is the Marketing Director for a major consumer packaged goods company. After conducting
marketing research, he has a few innovative ideas about how his company can better utilize their
promotional efforts to motivate customers to buy more product. He understands the importance of
planning and wants to develop a marketing plan. In order to create the right marketing mix
strategies, Daniel should focus on: Who the target market is and what their needs and wants may be
11. The four strategies that are blended into the marketing mix to meet the needs and preferences of a
specific target market are product, pricing, place and promotion. True
12. Marketing activities are customarily divided into four different strategies: product, price, place and
promotion. Select the term that best describes the four Ps. Marketing mix
13. In the last decade, the ___ strategy has been significantly impacted by the ability for customers to
order products via mobile apps, the Internet, and free-standing kiosks. These activities are most
closely associated with which element of the marketing mix? Place
14. Jodi found the perfect location for her new jewelry boutique in a wealthy, downtown area of the city.
She has signed exclusive agreements with several major distributors and has worked closely with
an advertising firm to develop the right promotional activities to let potential customers know about
the grand opening. Based on this description, which aspect of the marketing mix does she still need
to work on? Price
15. Tanya is opening her own boutique store selling name brand footwear for women. She has signed
exclusive agreements with several major luxury manufacturers. These manufacturers have given her
a suggested retail price (MSRP) that her research with potential customers has confirmed is the right
price point. She has signed a lease on the perfect location for her new boutique in a wealthy,
downtown area of the city and has begun remodeling the store to fit the image of her brand. Based
on this description, which element of the marketing mix does Tanya still need to work on?
Promotion
16. The marketing mix is uncontrollable by employees within the organization, such as the marketing
manager, since competitors and customers largely make strategic marketing decisions. False
17. Leah is in the market for a vintage album by Nat King Cole and has decided to use Ebay to try and
find this unique product. She is thrilled when she learns that a woman in Tucson, Arizona is actually
selling her mint condition album and that no one has bid on it yet. After her winning bid on the
auction, Leah pays the seller and anxiously awaits the album by mail the next week. This transaction
can best be defined as a: Consumer-to-consumer exchange
18. To calculate _____, a company must subtract expenses from revenue. Profit
19. Marketing can be identified primarily as the activities of advertising and personal selling. False
20. Robert is the marketing director for a real estate agency that specializes in commercial real estate.
Part of his job responsibilities include developing brochures and business cards for the agents,
purchasing billboard space to promote the company's brand, and purchasing ad keywords in high
profile search engines. All of these purchases that he makes on behalf of the real estate firm are
examples of: Business-to-business exchanges