The Fundamentals of Marketing: Concepts, Strategies, and Socially Responsible Practices

Posted on Jun 4, 2024 in Economy

Functions and Scope of Marketing

What is Marketing?

– Marketing from a social point of view: A social process in which groups and individuals get what they need and want through creating, offering, and freely exchanging products and services that others value.

– Marketing from a business standpoint: The planning and implementation process of conceiving, pricing, promoting, and distributing ideas, goods, and services to create exchanges that satisfy specific objectives of organizations.

– Marketing: The art of selling products and satisfying needs profitably.

– AMA (American Marketing Association): Defines marketing as an organizational function and a set of processes for creating, communicating, and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders.

– Definition of e-Marketing: The art and science of choosing markets and managing to maintain and increase the number of consumers through the creation, delivery, and communication of higher added value to the customer.

The Concept of Exchange

In general, we can define the exchange as a way to get a desired product by offering something else in return.

The basic requirements of the exchange are:

  1. Existence of two parties
  2. Two things of value for each party
  3. Existence of communication
  4. Freedom to accept or reject
  5. Desirability to negotiate between the parties

DISCLAIMER: We define the exchange as a process of value creation that usually leaves both parties in a better situation than before.

Advantages:

Value added = ———–

Costs

The benefits can be functional and/or emotional.

Costs may be time, energy, psychological, etc.

– Transaction: Exchange of values between two or more parties, a settlement. It can differ from what we call a transfer because, in the latter case, there is sanctity to the counterparty. The transaction, therefore, is the realization of the exchange.

– Understanding Marketing as:

  1. Studying the initiation, development, and finalization of trade terms and, more specifically, the study of buyer behavior aimed at consummating exchanges.
  2. Studying the corporate organizational structure designed to consummate or facilitate exchanges, like the company market, the environment, and other distribution channels.
  3. Studying buyers and sellers and the same structure and organization.

The Scope of Marketing Performance

Marketing can be considered as work to create, promote, and provide the market with at least ten kinds of offerings: goods, services, experiences, events, people, places, properties, organizations, information, ideas, and/or combinations thereof.

Company Approaches to the Market

Companies implement their competition using seven different approaches:

  1. Focus on production: The consumer seeks readily available products at a low price. Therefore, it is often applied consistently to the above economies of scale, lowering costs, increasing distribution, and others.
  2. Product Focus: Consumers are looking for better quality products or better results. Companies direct their efforts to improve benefits and qualities in general.
  3. Focus on sales: Consumers need to be pushed on purchases, and therefore the efforts of companies who follow this policy will be aimed at sales and promotions.
  4. Marketing approach: Identify the needs and desires of the target audience to create and deliver value more cost-effectively than competitors in the target market.
  5. Reactive and proactive marketing (total marketing approach): On the one hand, we can define the role of reactive marketing to understand and meet the needs expressed by consumers. On the other hand, proactive marketing will focus on the latent needs of consumers. The sum of both will result in the total marketing approach, which is ideal for companies to adjust to have the best chance of success and put the customer at the center of the whole business.

Obstacles that may arise in total marketing:

  • Organizational resistance
  • Slow learning
  • Easy to forget in the implementation
Holistic approach: The development, design, and implementation of programs, processes, and marketing activities that recognize the scope and interdependence of their effects by recognizing the need for a comprehensive and integrated perspective of four elements:
  • Relationship Marketing
  • Integrated Marketing
  • Internal Marketing
  • Marketing social responsibility

Marketing Concepts and Functions

Needs, Desires, and Demands

Need: Existence of a generic lack, normally linked to basic human needs.

Desire: Specifies a need.

Demand: A want for a product backed by the capacity for payment.

DISCLAIMER: There is a discussion about whether marketing managers create needs or if they already exist.

We can find five types of needs:

  1. Declared needs (explicit) – economic drive
  2. Real needs (concrete) – drive quality/affordable price
  3. Unmet declared needs – Good seller service
  4. Delight needs (additional) – GPS in the car
  5. Secret needs (subjective and personal) – Need for recognition as a good buy

Target Market, Positioning, and Monitoring

The market, from a marketing point of view, can be understood as the set of buyers in front of the industry we call all vendors.

Market segmentation identifies and defines the profile of different buyer groups based on their different needs and preferences.

The target market segment is defined as the best opportunities for which offerings are developed.

Positioning is the company’s performance managed to consolidate its strategy of quality, performance, usability, etc., in the minds of consumers.

Product, Brand, Offer

Product: Any bid may satisfy a need or a desire to be successful if it provides value and satisfaction to the potential buyer.

Brand: An offer from a known source associated with this; we define the brand as the association of ideas related to the brand.

Offer: A combination of products embodied in a set of benefits to meet needs (value proposition) that can be materialized in physical objects, services, information, experience, etc.

Value and Satisfaction

Value: A combination of quality, service, and price, which is also called the customer value triad.

Satisfaction: Reflects the comparison between the results and expectations of a product.

Marketing Channels

Definition of marketing channels: Used to reach a target market, being able to combine different types to bid. There are three types:

  1. Communication channels: Media advertising, print, television. These are extended with so-called dialogue channels (internet, phone, consumer, etc.)
  2. Distribution Channels: Used to display and/or deliver the actual product. Also called commercial channels (distributors, wholesalers, etc.)
  3. Channels: They serve to make transactions with potential buyers.

Supply Chain

Definition of Supply Chain: The channel will go from raw materials to the final buyer, assuming a value of warrant (surrender value).

Competition

Concept of competence: A set of all current and potential rival bids and substitute goods the buyer might consider.

We may find different levels of competition depending on the degree of substitution. These four levels are:

  1. Powers of Marks (Vehicles in the same range)
  2. Industrial competition (car manufacturers)
  3. Competencies forms (same type of need, transportation)
  4. Competencies generic (Consumer Money)

Marketing Environment

Definition of the marketing environment:

Operating environment: All agents influencing the production, distribution, and promotion of the offer.

General environment: A set of economic, demographic, technological, political-legal, sociocultural, and natural factors that significantly influence functional environmental agents.

Marketing Planning Process

Marketing planning process: It consists of identifying and analyzing business opportunities, selecting markets, developing strategies, defining programs, and managing marketing efforts.

Eight Functions of Marketing

  1. Develop marketing strategies and tactics (The importance of competition, experience, growth opportunities)
  2. Identification of changes in the environment and business opportunities (Information Systems and market research)
  3. Connecting with customers (whether consumers, sales teams)
  4. Building Strong Brands (skills, positioning the company)
  5. Offer definition (Definition of product, price, etc)
  6. Delivering value (make available to the target audience)
  7. Communicating value (advertising, direct marketing ideas)
  8. Developing long-term profitable growth (creation of new products)

Social Responsibility and Ethics of Marketing

Social Marketing Approach

Defining the social marketing approach: Seek to identify the needs, desires, and interests of their target audiences and meet them more effectively than the competition while preserving and enhancing the long-term welfare of consumers and society.

Relevance of Social Marketing

The four reasons why social marketing is relevant today:

  1. Increasing expectations of consumers and workers
  2. Legislation
  3. The interests of investors
  4. Government pressure

The three most important reasons:

  1. Business success must be added to ongoing customer satisfaction.
  2. Classification of legal proceedings (false advertising, quality defects)
  3. More likely to live in the information age, to be discovered by many consumers in unethical situations.

Improving Social Response

The three strategies to improve the social response:

  1. Legal conduct, knowing and enforcing it throughout the organization
  2. Concrete about their own ethical codes accountable to all members of the company
  3. Via social behavior responsibility in practice with clients and other business relationships (half-environmental response)

Cause-Related Marketing

Marketing with a cause or commitment: Any marketing activity that links the company’s contributions to a cause of customers, involving them directly or indirectly from transacting business by collecting money. Drow Wright and Murphy provide a concrete definition. They say that there should be no economic objective related to social welfare and business resources, including voluntary and philanthropic action.

Advantages and Disadvantages of Cause-Related Marketing

The five advantages:

  1. Improve social welfare
  2. Provides brand differentiation
  3. Improving ties with customers
  4. Usually creates internal motivation for the company
  5. Improving the image of the brand or company that lends credibility, commitment status, and extending brand awareness.

Disadvantages:

  • Can turn into failure if there are questions of product links to the cause.

To select the cause, the company must follow criteria:

  • Realize the importance of aid in the particular case.
    • Differ from other companies
    • Adjust the maximum because the company

The brand marketing program for cause could focus on three ways:

  1. Own brand: cause-specific program receiving the parent brand itself.
  2. Brand Association: Link to an existing program, is usually the most common.
  3. Branded: Link to an existing program, but a specific brand is putting on the program.

Social Marketing

Defining social marketing: This refers to the efforts of governmental or non-profit organizations to promote a cause.