PAMPANGA STATE AGRICULTURAL UNIVERSITY

Magalang Pampanga

Department of Agricultural Business & Economics

And Entreprenership

Mgt. 170

Presented by:

Dr. Celeste S. David

1st Semester SY2020-2021
 Objectives

1. Understand the role of marketing and its core concepts.

2 Explain the relationship between customer value satisfaction
and quality.
3. Understand how the marketing concept calls for a customer
orientation.
4. Explain marketing strategies that are useful in the organization.
5. Discuss how to design business portfolios and growth strategies.
6. List and discuss the importance of the elements of the company’s environment.
7. Illustrate the product, including the core, facilitating, supporting,
and augmented product.
8. Define quality and discuss the importance of the benefits of quality.
9. Discuss the marketing mix such as product, price, place, and promotion.

Mgt. 170
Dr. Celeste D. Gatus
 “Marketing is so basic that it cannot be considered a
separate function. It is the whole of business seen from
the point of view of its final result, that is, from the
customers point of view…Business success is not
determined by the producer, but by the customer.”

-Peter Drucker
 What is Marketing?

Marketing is a social and managerial

process by which individuals and groups
obtain what they need and want through
creating and exchanging products and
value with others.

E
Core Marketing Concepts

Enterprise Analysis
C.S. David
Professor: Dr. Teresita S. Oblepias
 Product
• A product is anything that can be
offered to a market for attention,
acquisition, use or consumption
that might satisfy a need or a
want.

Enterprise Analysis
C.S. David
Professor: Dr. Teresita S. Oblepias
 Marketing Management
Marketing management is the analysis,
planning, implementation, and control of
programs designed to create, build, and
maintain beneficial exchanges with target
buyers for the purpose of achieving
organizational objectives.
Marketing Management
Philosophies

Manufacturing
Product
Selling
Marketing
Societal Marketing

Enterprise Analysis
J.A.Catalan
Professor: Dr. Teresita S. Oblepias
Marketing and Sales
Concepts Contrasted
 The Future of Marketing
Rapid changes make yesterday’s
techniques out-of-date.

All company departments are becoming

involved in satisfying customers.

A focus on internal as well as external

marketing.
Characteristics of Service
Marketing
 Market-Oriented Strategic
Planning
Market-oriented strategic planning is the
managerial process of developing and
maintaining a feasible fit between the
organization’s objectives, skills and resources
and its changing market opportunities.
Key Ideas Defining Strategic
Planning
1. Manage companies businesses as an
investment portfolio.
2. Assess future profit potential.

3. Develop the strategy itself.

 The Relationship Between
Analysis, Planning,
Implementation, and Control
 Establishing Strategic
Business Units
A single business or a collection of related
businesses that can be planned for
separately from the rest of the company.

It has its own set of competencies.

It has a manager who is responsible for

strategic planning and profit performance.
 Assigning Resources to
Each SBU

Analytical tools, such as the Boston

Consulting Group (BCG) model, are
used to classify businesses by profit
potential.
 BCG Growth-Share Matrix

Star Question mark

Market growth rate

High
Low

Cash cow Dog

High Low
Relative market share
©2006 Pearson Education, Inc. Upper Saddle River, NJ 07458
Marketing for Hospitality and Tourism, 4th edition
Kotler, Bowen, and Makens
Developing Growth
Strategies
 The Company’s
Microenvironment
 The Company’s Macroenvironment

(Adapted from Analysis for Market Planning, Donald R. Lehmann and

Russell S. Winer, p. 22, 1994 by Richard D. Irwin.)
 Marketing Information
System
A Marketing Information System (MIS)
consists of people, equipment, and
procedures to gather, sort, analyze, evaluate,
and distribute needed, timely, and accurate
information to marketing decision makers.
 Marketing Information System

©2006 Pearson Education, Inc. Upper Saddle River, NJ 07458

Marketing for Hospitality and Tourism, 4th edition Kotler, Bowen, and Makens
Consumer Buying Behavior
Consumer buying behavior refers to the
buying behavior of final consumers –
individuals & households who buy goods
and services for personal consumption.

The central question for marketers is: “How

do consumers respond to various
marketing efforts the company might
use?”
 A Model of Consumer
Behavior

©2006 Pearson Education, Inc. Upper Saddle River, NJ 07458

Marketing for Hospitality and Tourism, 4th edition
Kotler, Bowen, and Makens
 Personal Characteristics
Affecting Consumer Behavior
Cultural Factors
Social Factors
Personal Factors
Psychological Factors
 Factors Influencing Consumer
Behavior

©2006 Pearson Education, Inc. Upper Saddle River, NJ 07458

Marketing for Hospitality and Tourism, 4th edition
Kotler, Bowen, and Makens
The Organizational Buying
Process
Market Structure and Demand

– Organizational demand is derived

demand; it comes ultimately from the
demand for consumer goods or
services.
The Organizational Buying
Process
Organizational buying decisions tend to
be more complex than consumer
decisions.

The organizational buying process

tends to be more formal than the
consumer process.
Participants in the Organizational
Buying Process
Users Influencers
Ethical
Decision-
Factors
Deciders
Making Unit
Situational
of a Buying
Unexpected

Roles Include Organization

is Called Approvers
Its Buying
Attitudes
Center.
of
Others
Gatekeepers Buyers

©2006 Pearson Education, Inc. Upper Saddle River, NJ 07458

Marketing for Hospitality and Tourism, 4th edition
Kotler, Bowen, and Makens
Market Segmentation
Geographic Segmentation

Demographic Segmentation

Psychographic Segmentation

Behavioral Segmentation
 Requirements for Effective
Segmentation

• Size, purchasing power, profiles

Measurable of segments can be measured.

• Segments can be effectively

Accessible reached and served.

• Segments are large or profitable

Substantial enough to serve.

• Effective programs can be

designed to attract and serve
Actionable the segments.

©2006 Pearson Education, Inc. Upper Saddle River, NJ 07458

Marketing for Hospitality and Tourism, 4th edition
Kotler, Bowen, and Makens
 Market Targeting

Evaluating Market Segments

Selecting Market Segments

Choosing a Market-Coverage Strategy

 Evaluating Market
Segments

Segment Size and Growth

Segment Structural Attractiveness

Company Objectives and Resources

 Positioning Strategies
Products can be positioned on specific
attributes or against another product
class.

E
Choosing and Implementing
a Positioning Strategy
1. Identifying a set of possible competitive
advantages upon which to build a position.

2. Selecting the right competitive advantages.

3. Effectively communicating and delivering

the chosen position to a carefully selected
target market.
 Selecting the Right
Competitive Advantages
Avoid:
Underpositioning - failing ever to
position the company at all.
Overpositioning - giving buyers too
narrow a picture of the company.
Confused positioning - leaving
buyers with a confused image of a
company.
 Product
levels
(Adapted from
C. Gonroos, “Developing
the
Service Offering—
A Source of Competitive
Advantage,” in
Add Value to Your Service,
C. Surprenant, ed.,
Chicago:
American Marketing
Association,
1987, p. 83.)

©2006 Pearson Education, Inc. Upper Saddle River, NJ 07458

Marketing for Hospitality and Tourism, 4th edition
Kotler, Bowen, and Makens
 Branding
Consistency Quality & Value

Attributes Advantages Identification

of
Brand Names

High Brand Brand Strong Brand

Loyalty Equity Association

Name Awareness Perceived Quality

©2006 Pearson Education, Inc. Upper Saddle River, NJ 07458

Marketing for Hospitality and Tourism, 4th edition
Kotler, Bowen, and Makens
 New Product Development Process
Marketing Business
Strategy
Analysis
Development
Concept
Development Product
and Testing Development

Idea Market
Screening
Testing

Idea
Generation Commercialization

©2006 Pearson Education, Inc. Upper Saddle River, NJ 07458

Marketing for Hospitality and Tourism, 4th edition
Kotler, Bowen, and Makens
 Product Life Cycle
Sales and Profits Over the Product’s Life From Inception to
Demise

Sales and
Sales
Profits ($)

Profits

Time
Product Introduction Growth Maturity Decline
Develop-
ment
Losses/
Investments ($)

©2006 Pearson Education, Inc. Upper Saddle River, NJ 07458

Marketing for Hospitality and Tourism, 4th edition
Kotler, Bowen, and Makens
 Managing the Perceived Service
Quality

©2006 Pearson Education, Inc. Upper Saddle River, NJ 07458

Marketing for Hospitality and Tourism, 4th edition
Kotler, Bowen, and Makens
 The Five-
Gap
Model of
Service
Quality

©2006 Pearson Education, Inc. Upper Saddle River, NJ 07458

Marketing for Hospitality and Tourism, 4th edition
Kotler, Bowen, and Makens
 Price
Price is the amount of money charged for
goods or services.

The only marketing mix element that

produces revenue.
 Factors to Consider
when Setting Prices

©2006 Pearson Education, Inc. Upper Saddle River, NJ 07458

Marketing for Hospitality and Tourism, 4th edition
Kotler, Bowen, and Makens
General Pricing Approaches
Cost-Based Pricing

Break-Even Analysis and Target Profit Pricing

Value-Based Pricing

Competition-Based Pricing
 Cost Based Pricing
Product

Cost

Price

Value

Customers

©2006 Pearson Education, Inc. Upper Saddle River, NJ 07458

Marketing for Hospitality and Tourism, 4th edition
Kotler, Bowen, and Makens
 Break-even Analysis or Target Profit
Pricing

©2006 Pearson Education, Inc. Upper Saddle River, NJ 07458

Marketing for Hospitality and Tourism, 4th edition
Kotler, Bowen, and Makens
 Value-based Pricing
Customer

Value

Price

Cost

Product

©2006 Pearson Education, Inc. Upper Saddle River, NJ 07458

Marketing for Hospitality and Tourism, 4th edition
Kotler, Bowen, and Makens
 New-Product Pricing Strategies

Setting Initial Product Prices

Market Skimming Market Penetration
> Setting a high price
> Setting a low price
for a new product to
for a new product in
skim maximum
order to attract a
revenues from the
large number of
target market.
guests.
> Results in fewer,
> Results in a larger
more profitable sales.
market share.

©2006 Pearson Education, Inc. Upper Saddle River, NJ 07458

Marketing for Hospitality and Tourism, 4th edition
Kotler, Bowen, and Makens
 Distribution Channels

A distribution channel is a set of

interdependent organizations involved in the
process of making a product or service
available to the consumer or business user.
 Customer Marketing Channels

©2006 Pearson Education, Inc. Upper Saddle River, NJ 07458

Marketing for Hospitality and Tourism, 4th edition
Kotler, Bowen, and Makens
 Channel Conflict
Horizontal conflict is conflict between
firms at the same level of the channel.
– i.e. retailer to retailer

Vertical conflict, which is more

common, refers to conflicts between
different levels of the same channel.
– i.e. retailer to wholesaler
 Conventional vs. Vertical
Marketing Channels

©2006 Pearson Education, Inc. Upper Saddle River, NJ 07458

Marketing for Hospitality and Tourism, 4th edition
Kotler, Bowen, and Makens
Vertical Marketing Systems

Corporate VMS
Administered VMS
Contractual VMS
 Franchising
Granting the right to engage in offering,
selling, or distributing goods or services
under a marketing format which is designed
by the franchisor.

The franchisor permits the franchisee to use

its trademark, name, and advertising.

Higher survival rates.

 Promotion Mix
A promotion mix is a company’s total
marketing communications program and
it consists of a specific blend of:
Advertising
Personal Selling
Sales Promotion
Public Relations
Direct Marketing
Nature of Each Promotion Tool
Reach Many Buyers, Repeat Message
Advertising Many Times, Impersonal, Expensive

Personal Personal Interaction, Relationship

Selling Building, Most Expensive Promo Tool

Sales Wide Assortment of Tools, Rewards

Promotion Quick Response, Efforts Short-Lived

Public Very Believable, Dramatize a Company

Relations or Product, Underutilized

Direct Nonpublic, Immediate, Customized,

Marketing Interactive
 Major Decisions in
Advertising
Setting the Objectives

Setting the Advertising Budget

Message Decisions

Media Decisions

Campaign Evaluation
Major Tools in Marketing PR
Publications Speeches
Events Public Service
News Activities
Identity Media
 Sales-Promotion Tools
Samples Premiums
Coupons Point-of-Purchase
Packages Displays
Patronage Rewards Contests,
Sweepstakes, and
Games
Principles of Personal Selling
Prospecting and Negotiation
Qualifying Overcoming
Preapproach Objections
Approach Closing
Presentation and Follow-up/
Demonstration Maintenance
 Integrated Direct Marketing
A more powerful approach: execute a
multiple-vehicle, multiple-stage
campaign.

Paid Ad
with a Direct Outbound Face-to-Face
Response Mail Tele- Sales Call
Channel Mechanism marketing

©2006 Pearson Education, Inc. Upper Saddle River, NJ 07458

Marketing for Hospitality and Tourism, 4th edition
Kotler, Bowen, and Makens
Purpose of a Marketing Plan
Provides a road map for all marketing activities of the
firm for the next year.
Ensures that marketing activities are in agreement with
the corporate strategic plan.
Forces marketing managers to review and think
through objectively all steps in the marketing process.
Assist in the budgeting process to match resources
with marketing objectives.
Creates a process to monitor actual against expected
results.
 Marketing Plan Sections
I. Executive Summary
II. Corporate Connection
III. Positioning Statement
IV. Environmental Analysis and Forecasting
V. Segmentation and Targeting
VI. Next Year’s Objectives
VII. Resources Needed to Support Strategies and Meet
Objectives
VIII. Marketing Control
IX. Presenting and Selling the Plan
X. Preparing for the Future
THE SERVUCTION MODEL

Other Servicescape
Customers

Customer

Contact
Invisible
Organizations Personnel/
and Systems Service
Providers

Source: Adapted from E. Langeard, J. Boston, C. Lovelock, and P. Eiglier, Marketing of

Services: New Insights from Consumers and Mangers, Report No 81-104, Cambridge,
MA: Marketing Sciences Institute, 1981.
THE SERVICES TRIANGLE

The
service
strategy

1
3 2

The
customer
4 6

The The
systems employees

Source: Adapted from Karl Albrecht and Ron Zemke, Service America (Homewood, IL:
Dow Jones-Irwin, 1985), pp. 31-47.
 NON PROFIT ORGANIZATION

Categories of Non Profit Organizations:

•Client-oriented Organizations

•Member-oriented Organizations
•Public-oriented Organizations
Characteristics of Non Profit Organizations:
•The absence of the profit measure.
•Their tendency to be service organizations.
•The lesser role of the marketplace.

•The dominance of professionals.

•Differences in ownership.
•Their tendency to be political organizations.

•A tradition of inadequate management controls

 According to Philip Kotler, different institutions took
marketing at different rates. Hospitals certainly recognized
the importance of the marketing functions, but colleges are
somewhat behind. Museums and the performing arts have
taken into marketing. Many institutions misunderstand it.
They confuse marketing with either hard selling or
advertising, and therefore, do not show an aptitude for it.
References:
• Hoffman, K. Douglas & Bateson, John E,G(2006).
Services Marketing: Concepts, Strategies, and Cases.
Third Edition. Thomson South-Western.

• Kotler, Philip and Armstrong, Gary (2004).

Principles of Marketing. Tenth Edition. Pearson Prenice Hall.

•Kotler, Bowen, & Makens (2006).

Marketing for Hospitality and Tourism. Fourth Edition.
Prentice Hall.

•Stanton, W.J., Etzel, M.J., & Walker, B.J. (1994).

Fundamentals of Marketing. Tenth Edition.
McGraw-Hill Company.