PRINCIPLES OF MARKETING

REVIEWER - G12 2ND SEM-MIDTERM

Understanding of Marketing -​ These include:

What is Marketing? ❖​ Basic physical needs (food, clothing, warmth

safety)
-​ According to the American Marketing
❖​ Social needs for belonging and affection
Association (2013), marketing is the activity,
❖​ Individual needs for knowledge and
set of institutions, and processes for
self-expression
creating, communicating, delivering and
exchanging offerings that have value for
●​ Wants
customers, clients, partners, and society at
-​ The form that a human need takes as shaped
large.
by culture, individual personality, and social
-​ According to Kotler and Armstrong (2013),
environmental forces.
marketing is "managing the customers
-​ Effective marketing through creating an
profitably".
awareness of good products sold in
convenient locations can obviously form a
The Marketing Mix
person's wants.
-​ Consists of four different factors that
businesses need to get right in order to
●​ Demands
successfully sell their goods and services.
-​ Are human wants backed by buying power
-​ The marketing mix is also known as the four
-​ Consumers view products as bundles of
p's, and is as follows.
benefits and choose products that give them
the best bundle for their money
1.​ Product - Creating Value
-​ People demand products with the benefits
-​ Goods or services that are offered to the
that add up to the most satisfaction
market
●​ Exchange
2.​ Price - Capturing Value
-​ Marketing happens when a buyer and a seller
-​ Captures the value of a product
exchange something of value
-​ Normally, the price of a product equates to
-​ The buyer gained something and the seller
the benefits the product offers to consumers
has given up something but both of them are
-​ In exchange for the product, a company
more contented because each has satisfied
captures value or profit from the payment
their unmet needs
made by a consumer
●​ Market
3.​ Place - Delivering Value
-​ Composed of people with both desire and
-​ Includes the necessary activities to make the
ability to buy a specific product/service.
products available to customers
-​ The desire to buy a certain product/service of
people with unmet needs is not sufficient.
4.​ Promotion - Communicating Value
-​ People also must have the ability to buy like
-​ The component that informs, persuades, and
authority, time, and money
reminds potential value they can get from a
product
Scopes of Marketing
Target Market
-​ A specific group of customers whom an
1.​ Goods
organization focuses its marketing efforts.
-​ Physical goods comprise the volume of most
countries' production and marketing effort.
Components of Marketing -​ The Philippines produces and markets
billions of physical goods in developing
nations like this country, goods particularly
●​ Needs
food, commodities, clothing, and housing are
-​ A state of felt deprivation.
stronghold of the economy
-​ Humans have many complex needs. These
needs are part of basic human nature
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2.​ Services 8.​ Organizations

-​ As economies progress, a growing proportion -​ Organizations aggressively labor to create a
of their activities are concentrated on the strong, positive image in the mind of their
production of services. publics.
-​ The Philippine economy today consists of a -​ Meralco, a Filipino energy company,
lot of services-to-good-mix. advertises with a tagline "May Liwanag ang
-​ Services include airlines, hotels, and Buhay."
maintenance and repair people, in addition to
professionals like accountants, lawyers, 9.​ Information
engineers, and doctors. -​ The production, packaging and distribution of
-​ Many market offerings consist of a variable information is one of society's chief
mix of goods and services. industries.
-​ Schools and universities; publishers of
3.​ Experiences encyclopedias, nonfiction books, and
-​ Through organizing a number of services and specialized magazines; makers of CD's, and
goods, one can generate a stage, and a internet web sites are among the marketers
market experience. of information
-​ Eating in Jollibee, especially for children is an
experience; so is Starbucks. 10.​ Ideas
-​ Each market offering has a fundamental idea
4.​ Events at its core.
-​ Marketers endorse time-based events such -​ Basically, products and services are
as Pacquiao-Bradley fight, trade shows, platforms for conveying some idea or benefit
sports events, and artistic performances to gratify a core need.

5.​ Persons MARKETING GOALS AND APPROACHES

-​ Celebrity marketing has turn into a main and
popular business. Marketing Goals
-​ Artists, musicians, CEOs, physicians, -​ Statements of what results the company
high-profile wants to achieve with its marketing efforts.
-​ lawyers and financiers, politicians and other
professionals draw help from celebrity Marketing Objectives
marketers. -​ Specific objectives to give clear direction and
commercial targets.
6.​ Places
-​ Cities, states, regions, and nations battle to Marketing KPI
magnetize tourists, factories, company -​ Key performance indicators are used to
headquarters, and new residents. check that the marketing activities of a
-​ Place marketers consists of economic company are on track.
development specialists, real estate agents,
commercial banks, local business Example
associations, and advertising and public
MARKETING GOAL: TO INCREASE BRAND
relations agencies.
AWARENESS
7.​ Properties
Objective 1 Boost social media
-​ Properties are intangible rights of ownership
followers by 25% in the
of either real property (real estate) or
next 6 months
financial property (stocks or bonds).
-​ Properties are purchased and sold which KPI Growth in social media
requires a marketing efforts be real estate followers (number and
agents (for real estate) and investment percentage)
companies and banks (for securities).
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-​ Can attract a sizable segment of emerging

consumers that are conscious of
MARKETING GOAL: TO INCREASE BRAND
environmental issues
AWARENESS
-​ May include using sustainable materials,
reducing excessive packaging, eliminating
Objective 2 Increase the share rate
wasteful manufacturing processes or
of content by 20% in 3
preferring digital marketing over traditional
months
marketing to save resources
KPI Content shares per -​ This type of marketing is good for the planet
platform. and can be beneficial for the company.

CUSTOMER RELATIONSHIP MANAGEMENT

CONTEMPORARY MARKETING APPROACHES
What is RELATIONSHIP MARKETING?
❖​ NOT-FORPROFIT ORGANIZATION -​ It is a strategy that concentrates on keeping
MARKETING and improving relationships with existing
-​ The tactics and strategies nonprofit customers
organizations use to raise donations and -​ It is also a strategy designed to foster
spread their message. customer loyalty and long term engagement
-​ Includes a wide range of activities, such as
direct mail marketing, mobile marketing, What is CUSTOMER RELATIONSHIP MANAGEMENT?
content marketing, and social media -​ It is the process of building and maintaining
marketing. profitable customer relationships by
❖​ PERSON MARKETING delivering superior customer value and
-​ The process of promoting an individual as a satisfaction thus ensuring customer loyalty
brand, leveraging one's strengths and abilities
to create a unique image and reputation that CUSTOMER VALUE
sets them apart from others -​ The customer’s perception of the benefits
❖​ PLACE MARKETING that he gets from a product or service, in
-​ Involves promoting a specific location by relation to the price paid to obtain those
encouraging people to spend time and money benefits
in that place
❖​ CAUSE MARKETING CUSTOMER SATISFACTION
-​ The cooperative effort made between a -​ The customer’s evaluation of the
for-profit and a non-profit organization, in performance of the product or service in
which both benefit while helping others. relation to his expectations
-​ Cause marketing boosts a company’s
reputation and instills confidence and trust CUSTOMER RETENTION
from consumers. -​ The company’s effort to build and maintain
❖​ EVENT MARKETING loyalty of customers
-​ The experiential promotion of a product,
service or brand which typically involves Levels of Relationship Marketing
direct interaction between a company
representative and the target audience. BASIC MARKETING
-​ The company can organize and execute an -​ Direct sales and the most basic level of
event (product launch) or participate in an interaction between the company and the
event (convention) customer
-​ While the focus for the audience may be the
event, the company’s objective is to promote
a product or service
❖​ GREEN MARKETING REACTIVE MARKETING
-​ The salesperson tells the customer that
he/she can be contacted for any inquiry
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REVIEWER - G12 2ND SEM-MIDTERM

Basic and Expected Level

ACCOUNTABLE MARKETING -​ These levels include the basic requirements
-​ The salesperson voluntarily contacts the of conducting a business
customer to ensure the product condition -​ Ex: tables and chairs in a restaurant

PROACTIVE MARKETING Desired Customer Value

-​ The company works closely with a group of -​ This involves what the customers want from
regular customers for constructive feedback the purchase or service experience.

PARTNERSHIP MARKETING Unanticipated Customer Value

-​ The company has already built a loyal group -​ It pertains to an unexpected purchase or
of customers who can help in improving the service experience that may go beyond what
products the customers desire.

Relationship Development Stages Types of Customers

1.​ STRANGERS
2.​ ACQUAINTANCES STRANGERS
3.​ FRIENDS -​ Customers whose needs do not fit the
4.​ PARTNERS company

CUSTOMER VALUE BUTTERFLY

-​ It is defined as the satisfaction derived from -​ Customers are not loyal to a specific brand
what a customer may experience or expect to
experience by choosing a particular action TRUE FRIENDS
relative to the cost of that action. -​ Customers have need that match the
company’s offering

FREE LOADERS
How Customer Perceived Value?
-​ loyal but not profitable because their needs
have a limited fit with the company’s offering

STRATEGIC AND MARKETING PLANNING

What is a Strategic Planning?

-​ According to Kotler (2011), Strategic planning
“sets the stage for the rest of planning in the
firm”.
-​ Perceived value indicates how much a -​ is the process of defining the key directional
customer is prepared to pay for a product or elements of an organization.
service.
-​ This is determined by a product or service's Strategic Planning Process
ability to meet the customer's needs and 1.​ Define Vision and Mission
inspire desire, especially in comparison with 2.​ Environmental Scan
competitors. 3.​ Goal Formulation
4.​ Strategy Formulation
Value Points of Customer Value 5.​ Program Formulation
1.​ Service 6.​ Implementation
2.​ Quality 7.​ Feedback and Control
3.​ Image
4.​ Price What is Marketing Planning?
-​ It is a process that consists of analyzing the
Levels of Customer Value current situation and information about
marketing opportunities, forecasting and
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REVIEWER - G12 2ND SEM-MIDTERM

establishing planning premises, selecting -​ Are people who are willing and able to buy
target market(s), and determining marketing organization’s products and services.
objectives.
DIFFERENT TYPES OF CUSTOMERS
Marketing Planning Process
1.​ Situational Analysis 1.​ Consumer Market - individuals and
2.​ Marketing Objectives households that buy products for personal
3.​ Marketing Strategies consumption.
4.​ Marketing Tactics 2.​ Business Market - buys materials for use in
production
Strategic Planning vs Tactical Planning 3.​ Reseller Market - buys products for reselling
at a profit
STRATEGIC 4.​ Government Market - government agencies
-​ defined as the general plan of action aligned that buy products to provide public service
with the company’s vision and goals 5.​ Global Market - consumers from other
TACTICAL country
-​ refers to the actions a company undertakes
to execute an organization’s strategy COMPETITORS
-​ Offer products belonging in the same product
MARKETING ENVIRONMENT category or industry

What is Marketing Environment? PUBLIC

-​ It consists of the different components that -​ Any group of individuals that has an actual or
affects the company’s ability to maintain its potential interest in the company or its
position in the market and build successful products
relationships with its customers.
TYPES OF MEMBERS OF THE PUBLIC
MICROENVIRONMENT
-​ Consists of the components close to the 1.​ Financial Public - banks, lending institutions,
company that directly affect its ability to stockholders
maintain its position in the market and its 2.​ Government Public - government agencies
capacity to serve its customers. that formulate regulations and provide
-​ It consists of the company management, permits for the conduct of the business
suppliers, intermediaries, customers, 3.​ Media Public - TV, radio, print, or media
competitors, and publics. agencies
4.​ Citizen-action Public - organizations that
ACTORS IN THE MICROENVIRONMENT champion different causes from the
THE COMPANY promotion of environmental protection for
-​ The organizations itself consists of the fighting to minorities rights
owners, investors, and employees who are 5.​ Local Public - people within the immediate
considered members of the organization. community where the company is located
6.​ General Public - anyone who knows about
SUPPLIERS the company and anyone who can see the
-​ Provide the resources and materials needed campaigns and products of the company
by the company to manufacture goods and 7.​ Internal Public - consist of the company’s
deliver services. employees, management, and stakeholders
who contribute in achieving the goals of the
MARKETING INTERMEDIARIES organization
-​ Entities that help get the company’s products
to its final consumers. MACROENVIRONMENT
-​ Consists of the bigger factors that are
CUSTOMERS beyond the control of the management
DEMOGRAPHIC
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-​ Contains quantitative information on the problems or take advantage of marketing

human population such as age, gender, opportunities
income, religion, educational attainment, and
other statistical data.
Importance of Marketing Research to Business
Enterprise
Baby Boomers - Born post War II (Between 1946-1964)
Generation X - Born between 1965 and 1976 1.​ Provides valuable data
Generation Y or Millennials - Born between 1977 and 2.​ Studies consumer behavior
2000 3.​ Selects promotional techniques
Generation Z - Born after the year 2000 4.​ Supplies marketing information
5.​ Evaluates marketing performance
POLITICAL
-​ Refers to government actions that influence
the economy at large, such as policies and
laws on taxation, trade, and labor.

ECONOMIC
-​ Consists of factors that affect the purchasing
power and spending patterns of consumers.

SOCIAL
-​ Include institutions and other forces that
affect the basic values, behaviors, and
preferences of the society, all of which have
an effect on consumer buying decisions.
CONSUMER & BUSINESS MARKET
TECHNOLOGICAL
-​ Refer to the rate of new inventions and CONSUMER BEHAVIOR
development, changes in information and -​ is the study of how consumers individuals,
mobile technology, changes in internet and households, groups, or organizations-decide
e-commerce or even mobile commerce, and to buy, use and dispose of goods, services,
government spending on research. experiences, and ideas to satisfy their needs
and wants.
LEGAL
-​ Also affect an organization even though a Factors Affecting Consumer Behavior
company cannot directly influence any laws.
Psychological Factors
ENVIRONMENTAL -​ Includes perception of a need or situation,
-​ Include all those that influence or are the person’s ability to learn or understand
determined by the surrounding environment information, and an individual’ attitude.
such as climate, weather, geographical
location, and global changes in climate. Social Factors Social
-​ influences are quite diverse and can include a
MARKETING RESEARCH person’s family, social interaction, work or
school communities, or any group of people a
-​ The American Marketing Association defines person affiliates with
Marketing Research as the function that links
the consumer, customer and public to the Personal Factors
marketer through information -​ Are characteristics that are specific to a
-​ The systematic design, collection, person and may not relate to other people
interpretation, and reporting of information to within the same group. These characteristics
help marketers solve specific marketing may include how a person makes decisions,
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their unique habits and interests, and buys a certain product brand and realizes
opinions. that he or she may have made the wrong
decision.
Consumer Market
-​ Pertains to buyers who purchase goods and Complex Buying Behavior
services for consumption rather than resale. -​ Requires the greatest amount of involvement.
A consumer manifests this type of behavior
when buying a very expensive product, such
Consumer Purchase Decision Process
as piece of furniture or a luxury car.

Need Recognition BUSINESS MARKET

-​ This is the process of how consumer make -​ Are composed of firms and business
decision in purchasing first is they recognize organizations that purchase semi-processed
a problem or a need. goods or raw materials either for their
operations or for reselling.
Information Search
-​ After identifying consumer need, they will
Business Buying Decision Process
tend to search for information about the
product that he/she considers purchasing. ●​ Recognition of a need
●​ Determining product specification
Evaluation Alternatives ●​ Listing of possible suppliers
-​ In this stage, the consumer will set his/her ●​ Selection of supplier
criteria. ●​ Periodic review

Purchase Decision
Types of Business Buying SItuations
-​ Then after evaluating on the right product,
they will make the final decision to buy the
product Straight Rebuy
Post-purchase Evaluation -​ The company or firm is satisfied with the raw
-​ After using the product, consumer will materials or equipment from the supplier and
evaluate the performance of the product makes rebuys on a regular basis

Modified Rebuy
Types of Consumer Buying Behavior
-​ It happens when the company or firm has
encountered problems in the supplier’s raw
Variety Seeking Behavior material or equipment.
-​ Requires very little to no amount of
involvement. Usually a consumer manifests New Rebuy
-​ Refers to a new purchase made by the firm or
this type of behavior for the sake of trying
company from a different supplier.
something new when purchasing products
that are cheap but not routinely used. MARKETING SEGMENTATION, Market Targeting, and
Market Positioning (STP)
Habitual Buying Behavior
-​ Requires minimal amount of involvement as Target Marketing - A marketing strategy that breaks a
manifested in purchasing products which are market into segments and then concentrates the
routinely used, but whose features do not marketing efforts on one or few key segments
significantly differ from other brands. consisting of the customers whose needs and desires
most closely match the product or service offerings
Dissonance-reducing Behavior
-​ Often requires a relatively larger amount of STAGES IN TARGET MARKETING
involvement as manifested after a consumer
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Market Segmentation -​ When everyone is a customer, firms decide to

-​ Refers to the process of dividing consumer ignore market segment differences and go
market into smaller groups of consumers. after a whole market with one offer.
Market Targeting
-​ Ex. food (coke & mcdo)
-​ Companies and firms actually select their
target market based on a number of factors
including the resources of the company or Concentrated Marketing (also referred to as niche
firm, the strategies of competitors, and the market)
profitability expected from this specific -​ Where a business targets a smaller segment
market. of a larger market, where customers have
Market Positioning specific needs and wants
-​ Also referred to as product positioning where
-​ Ex: Sensodyne, Kotler, medical
Companies and firms develop ways to
promote and position their brands effectively
Differentiated Marketing (also referred to as segment
to their selected segments or target markets.
marketing)
-​ Happens when a company creates
Variables in Market Segmentation
campaigns that appeal to at least two market
segments or target groups.
1.​ Demographic
-​ Ex: Colgate (sensitive, for kids, total, white)
-​ Companies or firms perform market
segmentation according to demographic
Customized marketing
variables, they look at the basic statistical
-​ Tailoring a particular product to the specific
characteristics of consumers
needs of an individual customers

2.​ Geographic
Market Positioning - Refers to activities undertaken to
-​ Used for dividing consumer markets
create and maintain an idea of the product in the
according to the physical features of a
customer' mind.
certain area and other related characteristics
Types of Product Positioning
3.​ Psychographic
-​ includes lifestyle patterns, hobbies and
FEATURES-BASED POSITIONING
interests, beliefs, and personalities of
-​ Marketers sell their brands on the basis of
consumers
their features.
-​ Example: 3M sticky note pads are advertised
4.​ Behavioral
for their special adhesive feature, which
-​ Used for dividing consumer markets
makes them stick to a surface for a long time
according to the product usage of consumers
and their attitude towards the brand
USED-BASED POSITIONING
-​ Marketers sell their products or services
Market targeting - Evaluating and selecting market
based on their possible uses or the types of
segments that requires assessing the overall
circumstances when they can be used
attractiveness of the product offering.
-​ Example: The advertisements for seasoning
brand Magic Sarap focuses on how it can be
Types of Target Marketing
used for various types of dishes

Undifferentiated Targeting (also referred to as mass

USER-BASED POSITIONING
marketing)
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-​ Marketers advertise their products based on

the type of consumer who can benefit from
the product
-​ Example: Head and Shoulder shampoo is
being marketed as a product for young
consumers wanting to have dandruff -free
hair

HEAD-ON POSITIONING
-​ Is used by market challengers on the "number
two" brands in the market
-​ Example: Surf is regarded as the number two
detergent brand according to 2016 survey. In
the advertisement for the product. Surf is
positioned as a more effective and cheaper
detergent brand compared to the market
leader Tide

LIFESTYLE POSITIONING
-​ Marketers sell their products or services
according to the cultural practices or values
that their target market subscribe to
-​ Example: Coca Cola which has been
positioned as a brand with products that help
strengthen relationship among people