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Essential Standard 3.00

Understand the role marketing in business.

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Objective 3.01

Understand principles of marketing.

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Topics

Functions of marketing
Importance of marketing research to the creation or improvement of products or services
Selling prices of products and services
Classification of channels of distribution
Classification of the main types of promotion

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Functions of marketing�

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Functions of Marketing

What happens during the marketing process?

Activities of marketing happen throughout the seven functions of marketing

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Functions of Marketing continued

Seven functions of marketing:

Marketing-information management
Product/service management
Pricing
Place (Distribution)
Selling
Financing
Promotion

Product/service management may include several businesses involved with designing, developing, maintaining, improving, and obtaining products and services in order to meet the needs of customers.

Place (Distribution) involves using the best ways for customers to locate, obtain, and use the products and services of a business.

Selling involves communicating directly with potential customers in order to determine and satisfy their needs and wants.

Marketing-information management involves obtaining, managing, and using information about products and services, customers, and competitors to improve business decision-making and the performance of marketing activities.

Financing involves budgeting for marketing activities, securing necessary funds for operations, and providing financial assistance to customers.

Pricing involves determining and communicating the value of products and services.

Promotion involves communicating information such as features and prices about products and services to potential customers.

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Importance of marketing research to the �creation or improvement of products or services�

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Marketing Research

What is marketing research?

Steps in marketing research:

Define the marketing problem.
Study the situation.
Develop a data collection procedure.
Gather and analyze information.
Propose a solution.

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Marketing Research continued

Types of research studies

Surveys
Focus groups
Observations
Experiment

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Marketing Research continued

Similarities of products and services

Meet the needs or satisfaction of a target market
Include a mix of the marketing elements: product, price, promotion, and place (distribution)

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Marketing Research continued

Differences between products and services

Products Services

Tangible Intangible

Non-perishable or perishable Perishable

Separable Inseparable

Easier to market More difficult to market

More control over quality Less control over quality

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Selling prices of �products and services�

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Selling Prices of Products and Services

What factors influence the pricing of products and services?

Pricing formula

Selling price

=product costs + operating expenses + profit

Example: $215=67+38+100

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Selling Prices of Products and Services continued

What is markup?

Selling price = product cost + markup
Example: $35+$14=$49
$35*40%=$14

What is a markdown?

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Classification of distribution and promotion�

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Classification of Channels of Distribution

What is channel of distribution?

How does having a channel of distribution help businesses?

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Classification of Channels of Distribution continued

Types of channels of distribution:

Direct

Example-Tonya makes and sells drapes to local customers.

Indirect

Example-UPS delivers packages for Ann Taylor.

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Classification of the Main Types of Promotion

How do you know when communication is effective?

What is the relationship between effective communication and promotion?

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Classification of the Main Types of Promotion continued

Main types of promotion:

Personalized
Mass

What are some examples of personalized promotion?

What are some types of mass promotion?