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BACHELOR OF BUSINESS ADMINISTRATION MARKETING MANAGEMENT II Ms Patience Nyoni July 2017 www.regenesys.co.za

WHAT ANCHORS MARKETING? Marketing is anchored on the marketing mix, normally named the 4Ps. At higher levels you will study the extended marketing mix or additional 3Ps. 4Ps are: -Product (most crucial P) -Price -Place (distribution channels) -Promotion (marketing communications) www.regenesys.co.za

SECTION 1 The Scope and nature of marketing www.regenesys.co.za

THE SCOPE AND NATURE OF MARKETING • In year one we focused on the consumer market • The focus of year 2 is the business market (also known as the industrial market) – where companies buy and sell products and services directly from and to each other www.regenesys.co.za

MARKETING IS BOTH A SCIENCE AND AN ART • As a science, marketing has amassed a huge body of (academic and practical ) knowledge over many years based on scientific research • As an art, marketing managers also need intuition, or “gut feel”, which o n l y c o m e s f r o m y e a r s o f experience – especially of trial and error – in the market. The ability to think creatively, innovatively www.regenesys.co.za

GROUP ACTIVITY: EVOLUTION OF MARKETING Aim: • To understand the evolution of marketing. Time: • 5 minutes: watch Kotler’s video on evolution of marketing • 5 minutes: group feedback • 5 minutes: Facilitator’s feedback and closure Task: Watch a video on Kotler’s interview on evolution of marketing and • answer given question. www.regenesys.co.za

DISCUSSION QUESTIONS 1.Briefly explain how marketing has evolved from the early days of product marketing? 2. What is “experience marketing”? Give an example for this. 3. How many editions of Kotler’s textbooks on marketing have been published (at the time of the video clip) since his first edition in 1967? 4. Why would we say that Kotler (and every other marketing writer) has to update his book regularly through new editions? www.regenesys.co.za

VIDEO: EVOLUTION OF MARKETING Kotler, P. 2015, ‘The evolution of marketing’ www.regenesys.co.za

WHAT DO COMPANIES MARKET? Goods: cars, fridges, TV set • Services: airlines, hotels, car rental firms, banker • Events: trade show, theatre performances • Experiences eg Walt Disney’s Magic kingdom • People: celebrity marketing • Places: cities, provinces. • Properties • Organisations • Information • Ideas • www.regenesys.co.za

THE VALUE OF MARKETING • Three central themes in definitions for marketing throughout the module: • Creating value for customers • Building strong relationships with customers • Capturing value from customers www.regenesys.co.za

MARKETING AS A PROCESS The basic marketing process: Understand the market place, customer needs and 1. wants. Design a market driven marketing strategy. 2. Construct an integrated marketing program that 3. delivers superior value. Build profitable relationships and create customer 4. delight. Capture value from customers to create profits and 5. customer equity (Kotler and Armstrong, 2014:27). www.regenesys.co.za

UNDERSTANDING CUSTOMER NEEDS, WANTS AND DEMAND • A need is a “state of felt deprivation of some basic satisfaction” (Kotler and Armstrong, 2014:28) • Wants are the form (human and business) needs take as they are shaped by culture (human or corporate and personality”.(ibid) • Demands are “wants for specific products backed up by the ability and willingness to buy them” (ibid). www.regenesys.co.za

MARKET OFFERINGS: BUNDLES OF BENEFITS • A market offering is the bundle of benefits for fulfilling a customer’s needs and wants. • Market offerings are not only products but also services. • Services are “activities or benefits offered for sale that are essentially intangible and do not result in the ownership of anything” www.regenesys.co.za

CUSTOMER VALUE AND SATISFACTION • “Customer value and customer satisfaction are key building blocks for developing and managing customer relationships” (Kotler and Armstrong, 2016:32). • Customer value is based on the customer’s expectation of a product or service’s capacity to satisfy his or her needs, usually weighed against the cost. www.regenesys.co.za

MARKETING AND MARKETS A market is made up of actual and potential buyers of a product or service. Markets include means for: • Determining a price of the traded item • Communicating the price information • Facilitating deals and transactions • Effecting distribution www.regenesys.co.za

MARKETING AND SOCIAL EFFECTS • Social benefits are business activities that have a beneficial or favourable impact on society and the environment as a whole. • Businesses have to be conscious of their environment and observe green marketing issues (environmental friendliness) • Giving back to the society is called Corporate Social Responsibility (CSR) or Corporate Social Investment (CSI) • CSI helps in free advertisement www.regenesys.co.za

MARKETING ACCOUNTABILITY • “Marketing accountability is a term that signifies management with data that is understandable to the management of the enterprise.” (CTI reviews, 2016). • “Metrics are standards of measurements by which efficiency, performance, progress, or quality of plan, process or product can be assessed” BusinessDictionary.com, 2016) www.regenesys.co.za

MARKETING AND INFORMATION Marketers need to collect quality information about their customers so that they have deeper customer insights, which help them to address their target market with the appropriate marketing mix. This helps in organisations gaining a competitive advantage. “Customer insights are fresh understandings of customers and the market place, derived from marketing information that became the bases for creating customer value and relationships” (Kotler and Armstrong, 2015, 101). www.regenesys.co.za

SOURCES OF INFORMATION FOR MARKETERS • Marketing information system (MIS) • Internal (company) data • Marketing intelligence or environmental scanning • Marketing research Study the MIS model (Figure 2) in your study guide, page 28 www.regenesys.co.za

MARKETING INFORMATION SYSTEM • It “consists of people and procedures dedicated to assessing information needs, developing the needed information and helping decision makers use the information to generate and validate actionable customer and market insights” Kotler and Armstrong, 2016:132 ). • Study fig 2 in study guide (pp: 28) www.regenesys.co.za

ACTIVITY: GROUP WORK Aim: • To identify information that organisations gather internally and externally for marketing purposes. Time: • 5 minutes: discussion in groups of 5 • 3 minutes: feedback • 2 minutes: Facilitator feedback and closure Task: Identify 5 internal (microenvironment) and 5 external (macro environment) information important to marketers. www.regenesys.co.za

MARKETING RESEARCH PROCESS • Who conducts the marketing research? • The marketing research process • Step 1: Define the problem and set research objectives • Step 2: Develop the research plan • Step 3: Implement the research plan • Step 4: Interpret and report the findings www.regenesys.co.za

MARKETING RESEARCH PROCESS Step 1: Define the research problem and set research objectives The first step in the research process is the • identification and formulation of the problem to be researched It is important to draw up a problem • statement Setting research objectives (exploratory • research, descriptive, causal) www.regenesys.co.za

HIERARCHY OF QUESTIONS • Management questions: Are there changes in customer buying behaviour? • Research questions: What are the reasons for changes in buying behaviour? • Investigative questions: Can changes in income patterns cause a change in buying behaviour? • Measurement questions: What is your income? What is your occupation? www.regenesys.co.za

MARKETING RESEARCH PROCESS Setting objectives: • The objectives should be aligned with the corporate objectives. • Objectives should be SMART • SMART: Specific, Measurable, Attainable, Realistic and Time bound. • Research objectives may address: • Exploratory research • Descriptive research • Causal research www.regenesys.co.za

MARKETING RESEARCH PROCESS Step 2: Develop the research plan Once researchers have defined the research • problem and objectives, they must determine the exact information needed, develop a plan for gathering it efficiently, and present the plan to management This is also known as the research plan • Type of data and information needed (primary • versus secondary) Research approaches • Contact methods • Sampling plan • Data collection • www.regenesys.co.za