Chapter 1

The Marketing
Management
Process
營銷管理流程

McGraw-Hill/Irwin Copyright © 2013 by The McGraw-Hill Companies, Inc. All rights reserved.
 Why Are Marketing Decisions Important (1/4)?
Marketing attempts to measure and
anticipate the needs ( 需要 ) and
wants ( 欲望 ) of a group of customers
and respond with a flow of need
satisfying goods and services
Firms should:
Target those customer groups whose
needs are most consistent with the
firm’s resources and capabilities
( 公司的資源和能力 )
Develop offerings that meet the
needs of the target market better
than competitors
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 Why Are Marketing Decisions Important (2/4)?
 Make its products and services readily available to potential
customers (Potential customer = Existing profitable customers +
Future profitable customers )
 Develop customer awareness ( 察覺 ) and appreciation ( 欣賞 ) of
the value ( 價值 ) provided by the company’s offerings
e.g. Market share held by the leading personal computer vendors worldwide in 2018
e.g. Market share of Haier Electronics in selected household appliance segments in 2016
 Obtain market feedback as a basis for continuing improvement in the
firm’s offerings
 Work to build long-term relationships ( 建立長期關係 ) with
satisfied and loyal customers

Discussion Question:
How can Chanel increase the awareness ( 察覺 ) and appreciation ( 欣賞 )
of the value ( 價值 ) to existing profitable customers and future profitable
customers . 1-3 1-3
 Why Are Marketing Decisions Important (3/4)
Difference Between Needs and Wants?
Needs point out the something you must have for survival.
Wants refers to something which is good to have, but not
essential for survival.
For the purpose of spending and saving money wisely, every
person must know the difference between needs and wants.
Source: https://keydifferences.com/difference-between-needs-and-wants.html

YouTube:
https://www.youtube.com/watch?v=zW7k4Rvo1m8

Discussion Question:
1. How much salary do you need per month?
2. How much salary do you want per month? 1-4
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 Why Are Marketing Decisions Important (4/4)?
The importance of the top line:
In the long run, all firms must make a profit to survive
There can never be a positive bottom line (e.g.
earnings, profit, net income, or earnings per share) without
the ability to build and sustain a healthy top line (e.g.
sales revenue)
What Is the Top Line?
The top line is a reference to gross figures reported by a company, such as sales or revenue. It is called
the top line because it is displayed at the top of a company's income statement and is reserved for the
reporting of gross sales or revenue. A company that increases its revenue or sales is said to be
generating top-line growth.

What Is the Bottom Line?

The bottom line refers to a company's earnings, profit, net income, or earnings per share (EPS). The
reference to bottom line describes the relative location of the net income figure on a company's 
income statement.
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Marketing Creates Value by Facilitating Exchange
Relationships
Marketing:
A social process involving the activities necessary to
enable individuals and organizations to obtain what
they need and want through exchanges with others
and to develop ongoing exchange relationships

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What Factors Are Necessary for a Successful Exchange
Relationship?
Many exchanges are necessary for people and
organizations to reap (obtain) the benefits of the
increased specialization and productivity ( 提高專
業化和生產力 ) that accompany economic
development

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What Factors Are Necessary for a Successful
Exchange Relationship?
The conditions for a successful exchange
transaction can be met only after the parties
themselves have performed several tasks, such as:
Identifying potential exchange partners
Developing offerings
Communicating information
Delivering products, and collecting payments

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Who Markets and Who Buys?
The Parties in an Exchange (1/2)
Both (1) individuals ( 個人 ) and (2) organizations ( 公
司 ) seek goods and services obtained through
exchange transactions
Ultimate customers ( 最終客戶 ): They buy goods
and services for (1) their own personal use ( 個人使
用 ) or (2) the use of others in their immediate
household ( 家庭 ).
These are called consumer goods and services

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Who Markets and Who Buys?
The Parties in an Exchange (2/2)
Organizational customers ( 公司客戶 ): They buy
goods and services—known as industrial goods and
services
For resale
As inputs to the production of other goods or
services
For use in the day-to-day operations of the
organization

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 Customer Needs and Wants
Need ( 需要 ) : A gap between a person’s actual and desired
states on some physical or psychological dimension
Basic physical needs and social and emotional needs
Wants ( 欲望 ): Reflect a person’s desires or preferences for
specific ways of satisfying a basic need
Wants are shaped by:
Social influences
Past history
Consumption experiences

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What Gets Exchanged? Products and Services
Products ( 產品 ) and services ( 服務 ) help satisfy
a customer’s need when they are acquired, used, or
consumed
Products: Essentially tangible physical objects
that provide a benefit
For example, such as cars, watches, and

computers
Services: Less tangible—in addition to being
provided by people, institutions, places, and
activities
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How Exchanges Create Value
Customers buy benefits, not products
Value is a function of intrinsic ( 固有 ) product
features, service, and price, and it means different
things to different people

VS

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Exhibit 1.2 - Customers Buy Benefits, Not Products

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 How Exchanges Create Value
Lifetime customer value ( 客戶終生價
值 ): The present value of a stream of
revenue ( 收入來源 ) that can be produced
by a customer over time ( 隨著時間的推
移 )
Discussion Question:
According to your expending sending in MacDonald’s,
What is your lifetime value to MaDonald’s?

Brand equity ( 品牌資產 ): The assets

linked to a brand’s name and symbol
constitute the brand’s equity
Reflects a brand’s value to the company
depends on how much value
customers think the brand provides 1-15
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Defining a Market
Market ( 市場 )
Consists of individuals and
organizations who:
Are interested and
willing to buy a
particular product to
obtain benefits that will
satisfy a specific need or Discussion Question:
want
Can you create a new distinctive
Who have the resources product or service market that no
(e.g. money and time) to competitor serve (i.e. Blue Ocean Strategy
藍海策略 )?
engage in such a
transaction
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 Defining a Market
Market segment ( 市場區隔 )
Distinct segments that the
total market for a given product
category is often fragmented
into:
Each segment contains
people who are relatively
homogeneous in their
needs, their wants, and the
product benefits they seek
Each segment seeks a
different set of benefits
from the same product
category
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 Marketing Management—A Definition
The process of analyzing ( 分析 ), planning ( 計劃 ),
implementing ( 實施 ), coordinating ( 協調 ), and
controlling ( 控制 ) programs
Involves the conception, pricing, promotion, and
distribution of products, services, and ideas designed to
create and maintain beneficial exchanges with target
markets for the purpose of achieving organizational
objectives

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Marketing Management — A Definition
Basic focus of and the sequence of events within
marketing management
A decision-making focus
Analyzing the 4Cs

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 Integrating Marketing Plans with the Company’s
Strategies and Resources
Corporate strategy ( 企業策略 ): Reflects the
company’s mission and provides direction for
decisions about what businesses it should
pursue, how it should allocate its available
resources, and its growth policies
Business-level strategy ( 業務策略 ):
Addresses how the business intends to compete
in its industry
Marketing strategy ( 經營策略 ): Reflect a firm’s
interrelated decisions about market segments,
product line, advertising appeals and media,
prices, and partnerships with suppliers,
distributors, retailers, and other agencies
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 Market Opportunity Analysis
Understanding market opportunities
Customer analysis
Marketing research and forecasting
Market segmentation, targeting, and
positioning decisions
Market segments ( 市場區隔 ):
Distinct subsets of people with
similar needs, circumstances, and
characteristics that lead them to
respond in a similar way to a
particular product or service offering
or to a particular strategic marketing
program
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Formulating Strategic Marketing Programs
Specifying marketing objectives and strategies
Marketing program components
4Ps: Product offering, price, promotion, place
Marketing mix: The combination of
controllable marketing variables that a
manager uses to carry out a marketing strategy in
pursuit of the firm’s objectives in a given target
market

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Exhibit 1.5 - Decisions within the Four Elements
of the Marketing Mix

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Formulating Strategic Marketing
Programs for Specific Situations
The strategic marketing
program for a product
should reflect market
demand and the
competitive situation
within the target market
Different marketing
strategies are typically
more appropriate and
successful for different
market conditions and at
different life-cycle stages
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Implementation and Control
of the Marketing Program
A final critical determinant of a strategy’s success is the
firm’s ability to implement it effectively. This depends on
whether the strategy is consistent with
1. the resources (e.g. capital, human, facility
resources)
1. the organizational structure,
2. the coordination and control systems, and
3. the skills and experience of company personnel

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The Marketing Plan - A Blueprint for Action ( 行動藍圖 )

A written document
detailing the current situation with respect to (1)
customers, (2) competitors, and (3) the external
environment and
providing guidelines for (1) objectives, (2)
marketing actions, and (3) resource allocations
over the planning period for either an existing or a
proposed product or service

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Exhibit 1.6 - Contents of a Marketing Plan

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Exhibit 1.6 - Contents of a Marketing Plan

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Who Does What ( 誰做了什麼 )?
Marketing institutions
Vertical integration: Internal control of the full
range of marketing functions and activities
Marketing channels: Networks through which a
majority of goods and services in most developed
economies are marketed

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Exhibit 1.7 - What Must Change Hands to Complete
an Exchange between a Buyer and a Seller?

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Who Does What ( 誰做了什麼 )?
Categories of marketing institutions
Merchant wholesalers
Agent middlemen
Retailers
Facilitating agencies

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Who Pays the Cost of Marketing Activities - And Are
They Worth It ( 誰支付營銷活動的費用 - 值得嗎？ )
1/4?

The final selling price of the product reflects the

costs of performing the activities necessary for
exchange transactions
Though both individual and organizational
customers pay for the marketing activities of
manufacturers and their middlemen, they are still
usually better off ( 更好 ) than if they were to
undertake all the functions themselves

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Who Pays the Cost of Marketing Activities - And Are
They Worth It ( 誰支付營銷活動的費用 - 值得嗎？ )
2/4?
Benefits of the marketing system
Allows customers to buy a wide variety of goods
from a single source in one transaction, thereby
increasing transactional efficiency ( 效率 )
Specialization of labor ( 勞工專業 ) and
economies of scale ( 規模經濟 ) lead to
functional efficiency.
* Economies of scale is a proportionate saving in costs
gained by an increased level of production.
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Who Pays the Cost of Marketing Activities - And Are
They Worth It ( 誰支付營銷活動的費用 - 值得嗎？ )
3/4?
Possession utility ( 擁有效用 ): A product has greater utility
for a potential customer when it can be purchased with a
minimum of (1) risk and (2) shopping time
Place utility ( 地点效用 ): A product has greater utility for a
potential customer when it can be purchased with a minimum
of (1) risk and (2) shopping time at a convenient location

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Who Pays the Cost of Marketing Activities - And Are
They Worth It ( 誰支付營銷活動的費用 - 值得嗎？ )
4/4?
Time utility ( 時間效用 ): A product has greater utility for a
potential customer when it can be purchased with a minimum
of (1) risk and (2) shopping time, at a convenient location, and
at the time the customer is ready to use the product

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Room for Improvement in Marketing Efficiency
營銷效率的改善空間
Focus is on ways marketers are attempting to improve
operational efficiency through:
More effective use of telecommunications and
information technologies
The development of cooperative alliances with
suppliers, middlemen, and ultimate customers
The search for new measurement and budgeting
methods that are more clearly focused on
improving cash flows and adding economic value

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The Role of the Marketing Decision Maker

The title marketing manager is necessarily and

intentionally vague ( 模糊 ) because many people are
directly involved with an organization’s marketing
activities
This can include people not formally located in a
marketing or sales department or even within the
company

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Some Recent Developments Affecting Marketing
Management
Globalization
Increased importance of service
Information technology
Relationships across functions and firms

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