Jobber Chapter 1 Principles of Marketing

Jobber Chapter 1 Principles of Marketing

The Marketing Concept

The concept of marketing describes the need of a company to reach its goals. They can only succeed in this by fulfilling their customers’ needs better the competitors.

For this they have to create a (product or money) exchange which both parties (provider and costumer) feel satisfied with.

The key components of the marketing concept are consumer orientation,

integrated effort and goal achievement.

There has to be distinguished between the two marketing concepts of

consumer orientation and product orientation:

Consumer Orientation

Production Orientation

Limitations of the Marketing Concept

These concepts only work on a certain level. There have to be considered different limitations

-  Customer satisfaction is only one objective companies have to consider

-  The concepts may lead to a concentration on short-term satisfaction

-  If companies focus on reflecting but on creating demand there will

originate only dull marketing campaigns

Differences between market driven and internally orientated business

compare Jobber page 26

Efficiency – Effectiveness

Efficiency cares about the costs per unit and therefore tries to optimize the business processes. This results in a low-cost production.

ð  Tries to “do things right”

Effectiveness cares about markets and marketing strategies. Its concern is to make the right products for attractive markets.

ð  Tries to “do the right things”

Costumer value

Costumer value can be created by maximizing the benefits noticed by the costumer and by minimizing his sacrifices.

Perceived benefits / Perceived sacrifice
Product benefits
Service benefits
Relational benefits
Image benefits / Monetary costs
Time costs
Energy costs
Psychological costs

Marketing Mix

An effective marketing mix is designed by ensuring that it matches costumer needs, creates an advantage in competition, is well mixed and spread and fits to the company’s resources.

Product the physical and emotional features of the goods or services offered

-  product lines /service products

-  branding

-  packaging

Price The conditions of sale and supply

-  price variables-size and regularity of purchase

-  payment periods

-  credit terms

Place providing access to customers for goods and services

-  location of distribution outlets

-  transport and delivery

-  inventory and marketing channels

Promotion communicating the message

-  media advertising

-  sales promotion

-  personal selling

Attention! The “4-Ps“ simplify the reality, there are several

other factors to be included.

Examples: people, process and physical evidence in service marketing

long-term relationship building in industrial marketing

Jobber Chapter 2 Marketing planning

Key Planning Questions

The Marketing Planning Process

Business Mission

The key questions are:

“What business are we in?” and “What business do we want to be in?”

The following tasks are useful

Define management competences
Determine resources
Assess environmental change
Consider company background and ethos / Purpose - why the company exists
Strategy - the commercial rationale
Company values - what senior managers believe in
Standards and behaviour

Marketing Audit

The marketing audit is a systematic examination of a business’s marketing environment.

It provides answers to the following questions:

“Where are we now?” , “How did we get there?” and “Where are we heading?”

SWOT Analysis

The SWOT Analysis provides a simple method of summarizing the results of the marketing audit.

Marketing Objectives

I.  Strategic Thrust defines the future direction of the business

II.  Strategic objectives are product-level goals relating to the decision to build, hold, harvest or divest products.

The following methods are essential

BUILD sales and marketing share

HOLD or maintain current position

HARVEST through profit maximization

DIVEST and release resources for other products

Core Strategy

The Core Strategy consists of the three components “Target Markets”,

“Competitor Targets” and “Competitive Advantage”.

Target Markets is the process of matching the company’s resources and objectives with a distinct group of costumers.

The key questions are:

“What are trying to achieve”, “What are we capable of offering?”

and “Which customer groups present the best opportunities?”

Competitive Advantage can be built by Differential Advantage or Cost Leadership.

Implementation

Strategies can only be effective if attention is paid to implementation issues.

Examples: Change Management, Staff training, political issues

Control

The Principles of marketing control are:

(a)  set performance standards

(b)  locate/identify responsibility

(c)  establish criteria for measurement

Jobber Chapter 3 Consumer behaviour

Dimensions of Buyer Behaviour

The key dimensions are:

Decision Influence

The decision of the purchase may be made by a group of people (e.g. a household). The decision can be in the hands of a decision centre with up to five roles.

(1)  Initiator provides the stimulus

(2)  Influencer informs and persuades

(3)  Decision maker has authority or finance

(4)  Buyer conducts the transaction

(5)  User the ultimate consumer

The identification can provide opportunities to segment markets and to address the right costumer target group.

Examples: Lego advertisement in women’s magazines

The decision making process

(1)  Need recognition / problem awareness

(2)  Information search

(3)  Evaluation of alternatives

(4)  Purchase

(5)  Post-purchase evaluation

(1)  Need recognition

One has to be aware of the costumer’s needs, know how to stimulate them and how to overcome need inhibitors.

(2)  Information search

Marketing has to know where the consumer looks for information. Communication can then be directed through these sources and help to solve the consumer’s decision-making. One key objective is to ensure that the brand appears in the consumer’s awareness set.

(3)  Evaluation of alternatives

High involvement purchase: provide a lot of information

Print media suitable

Salespeople help to be aware of all features

Low involvement purchase: Top-of-mind awareness

Repetitive advertisement

Trial

For all consumer decisions the knowledge of choice criteria and of the importance of emotion is essential.

Choice criteria:

Technical / Personal / Economic / Social
Reliability
Durability
Performance
Style/looks
Comfort
Delivery
Convenience
Taste / Self-image
Risk reduction
Ethics
Emotions / Price
Value for money
Running costs
Residual value
Life-style costs / Status
Social belonging
Convention
Fashion

Post-Purchase Evaluation

The Post-Purchase Evaluation is a reflective process. It can be influenced by

after-sales service, packaging contents or installation staff. The Customer service aims to reduce post-purchase dissonance.

High-Involvement Purchase Low-Involvement Purchase

Low Involvement / High Involvement
Need recognition/
problem awareness / Minor / Major, personally important
Information search / Limited search / Extensive search
Evaluation of alternatives and the purchase / Few alternatives evaluated on few choice criteria / Many alternatives evaluated on many choice criteria
Post-purchase evaluation of the decision / Limited evaluation / Extensive evaluation including media search

Influence of consumer behaviour

Socio-cultural: culture, family, social class, reference groups

Personal: age and life-cycle stage, economic circumstances,

occupation, lifestyle

Psychological: motivation, perception, beliefs and attitudes

Culture

Culture reflects the values of our society and is therefore a basic determinant of group behaviour. Some cultural values are universal, some are particular to groups. These cultural groups may be national, ethnic, regional or local. A cultural shift happens when a change in group values manifests in group behaviour.

Social class

Social class is traditionally used by marketers to distinguish the behaviour of one group of people from another. Social class group members observe similar consumption patterns. They read similar newspapers, go to similar shops or events and spend their money in the same way.

Reference groups

Reference groups influence behaviour through different ways:

aspiration/identification (team leaders, elders)

opinion/example (celebrities)

peer group influence or pressure

Social Influence

The four types of social influence are culture, social class, geodemographics and reference groups.

Life cycle Stages

The AIO-Classification

Jobber Chapter 5 Organizational Buying Behaviour

An organizational product has not been purchased for a private household but for the use in an organization, to manufacture other products or for resale to others.

There are different organizational markets:

(1)  Industrial markets: business to business (B2B)

(2)  Reseller markets: business to consumer (B2C)

(3)  Government markets: public sector