3.1: The nature of marketing Flashcards
Def. Marketing
Identifying the wants and needs of consumers and satisfying those needs better than the competitors by using the right product design, pricing, promotion and placement.
Def. Industrial markets
Markets of goods and services bought by business to be used in the production process of other products
Def. Market
Has 2 meanings:
* The place of mechanism where buyers and sellers meet to engage in exchange eg. shopping centres or the internet.
* The group of consumers that is interested in a product and has the resources to purchase the product.
Def. Consumer markets
Markets of goods and services bought by the final user of them
Def. Human needs and wants
Needs are basic requirements that an individual would have e.g water, food
Wants are things an individual wouldn’t need for survival, but satisfies the human’s desires and human needs to an extent.
Def. Marketing objectives
The goals set for the marketing department to help the business achieve its overall objectives. e.g Increasing market share
Is product value and product satisfaction the same? Why?
No. High value products, as in expensive products with high cost to produce may not satisfy the individual. Customer satisfaction comes from a balance between high value and reasonable pricing.
How to determine whether the marketing objective is effective?
It has to be SMART: Specific, measurable, achievable, realistic/relevant, and time-bound.
Def. Marketing strategy
Long-term plan established for achieving marketing objectives.
What are the links between the marketing department and other departments? (3)
Marketing -> Finance: Help construct budgets from sales forecasts.
Marketing -> Human resources: if there’s a need for additional staff.
Marketing -> Operations: Planning on resources needed for for e.g new product development.
Why are marketing objectives important?
Provide a sense of direction for the department
Progress can be monitored against the objectives
Can be broken down into smaller objectives to show a clearer path
Form the basis for marketing strategy.
Def. Market orientation
An outward-looking approach basing product decisions on consumer demand, as established by market research. Market orientated products are designed based on the consumer’s satisfaction. e.g toothbrushes.
What are the benefits of market orientation?
Less chance of newly developed products to fail
Likely to survive longer with higher profits if consumer needs are met.
There’s constant feedback from consumers => research never ends => more chances for developing updates.
Def. Product orientation
An inward-looking approach that focuses on making products that can be made - or have been made for a long time - and then trying to sell them. Product orientated business concentrate their efforts on efficiently producing high-quality goods.e.g Medical machinery.
Def. Demand
The quantity of the product that consumers are willing and able to buy at a given price in a time period.
Def. Supply
The quantity of a product that firms are prepared to supply at a given price in a time period.
What’s the use of determining demand and supply?
It determine the equilibrium price from the ‘demand and supply analysis’.
What is the relationship between demand and price and how can it be affected?
Demand varies with price. The higher the price, the lower the demand: as the higher the price the less is sold.
The level of demand could also be affected by: changes in consumer incomes, changes in population size and structure, changes in substitute and complementary goods, fashion and tastes changes, advertising and promotion strategies.
