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Marketing Processes and

Consumer Behavior
Business Essentials, 7th Edition
Ebert/Griffin

Instructor Lecture
PowerPoints
2009 Pearson Education, Inc.

PowerPoint Presentation prepared by

Carol Vollmer Pope Alverno College

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After reading this chapter, you should be able to:
1. Explain the concept of marketing and identify the
five forces that constitute the external marketing
environment.
2. Explain the purpose of a marketing plan and
identify the four components of the marketing mix.
3. Explain market segmentation and how it is used in
target marketing.
4. Describe the key factors that influence the
consumer buying process.
5. Discuss the three categories of organizational
markets.
2009 Pearson Education, Inc.

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(contd)
(contd)
After reading this chapter, you should be able
to:
6. Explain the definition of a product as a value
package and classify goods and services.
7. Describe the key considerations in the new
product development process.
8. Explain the importance of branding and
packaging.
9. Discuss the challenges that arise in adopting an
international marketing mix.
10. Identify the ways that small businesses can
benefit from an understanding of the marketing
mix.
2009 Pearson Education, Inc.

Whats in It for
Me?
Why does marketing matter to you?
By grasping this chapters presentation
of marketing methods and ideas, youll
benefit in two ways:
Youll be better prepared to use marketing
in your career as both employee and
manager
Youll be a more informed consumer with
greater awareness of how businesses use
marketing to gain your purchases
2009 Pearson Education, Inc.

 2009 Pearson Education, Inc.

What Is Marketing?
Marketing
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 (AMA)
Finding a need and fulfilling it

Providing Value and Satisfaction

Consumers buy products that offer the
best value when it comes to meeting
their needs and wants
2009 Pearson Education, Inc.

What Is Marketing?
(contd)
Value and Benefits
Value compares a products benefits with
its costs.
Benefits include not only the functions of
the product but also the emotional
satisfaction associated with owning,
experiencing, or possessing it.

Value and Utility

Form utility
Time utility
Place utility
Ownership utility
2009 Pearson Education, Inc.

http://www.tappedthemovie.com/

What Is Marketing?
(contd)
Goods, Services, and Ideas
Consumer goods: Tangible goods that
consumers may buy for personal use
Consumer marketing

Industrial goods: Physical items used by

companies to produce other products
Industrial marketing

Services: Products with intangible

(nonphysical) features
Service marketing

Relationship Marketing
Emphasizes building lasting relationships with
customers and suppliers
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What Is Marketing?
(contd)
Data Warehousing and Data Mining for
Building Customer Relationships
Data warehousing: The compiling and
storage of consumer data
Data mining: Automating the massive
analysis of data by using computers to
sift, sort, and search for previously
undiscovered clues about what customers
look at, react to, and how they might be
influenced
2009 Pearson Education, Inc.

What Is Marketing?
(contd)
The Marketing Environment
Political-legal environment
Sociocultural environment
Technological environment
Economic environment
Competitive environment
Substitute products
Brand competition
International competition
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What Is Marketing? (contd)

Strategy: The Marketing Mix
Marketing Plan
A detailed strategy for focusing marketing
efforts on consumer needs and wants

Marketing Mix
Product
Differentiating a product

Pricing
Selecting the best price at which to sell a product

Place
Distributing a product through the proper channels

Promotion
Communicating information about a product
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Target Marketing and Market

Segmentation
Target Markets
Groups of people with similar wants and
needs who can be expected to show
interest in the same products

Market Segmentation
Dividing a market into categories of
customer types or segments
Geographic
Demographic
Psychographic
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TABLE 11.1 Demographic Variables

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Understanding Consumer Behavior

Influences on Consumer Behavior
Psychological influences
Personal influences
Social influences
Cultural influences

Brand Loyalty
Consumers who regularly purchase
products because they are satisfied with
their performance
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FIGURE 11.1 The Consumer Buying

Process
Problem\Need Recognition
Information Seeking
Evaluation of Alternatives

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Organizational Marketing and Buying

Behavior
Organizational Markets
Industrial Markets
Businesses that buy goods to be converted
into other products or that are used up
during production

Reseller Markets
Intermediaries, including wholesalers and
retailers, that buy and resell finished goods

Government and Institutional Markets

Federal and state governments
Nongovernmental organizations
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Organizational Marketing and Buying

Behavior (contd)
Organizational Buying Behavior
Differences in Buyers
Organizational buyers are professionals who
negotiate the buyer-seller agreement (purchase
terms)
Specialists in purchasing a line of items
Experts about the products purchased

Differences in the Buyer-Seller Relationship

Frequent purchases
Enduring long-term relationships
Buyers and sellers may work closely
Emphasis is on personal selling
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What Is a Product?
Product Defined
A value package that provides a bundle of
benefits and features to satisfy the needs and
wants of customers

Product Features
Tangible and intangible qualities built into a
product

Benefits
The tangible and intangible outcomes
associated with acquisition or use of a product

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TABLE 11.2 Categories of Consumer

Products

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TABLE 11.3 Industrial Products

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The Product Mix

Product Mix
The group of products (consumer, industrial,
or both) that a company makes available for
sale

Product Line
A group of products that are closely related
because they function in a similar manner
or are sold to the same customer group who
will use them in similar ways

Multiple (or Diversified) Product Lines

Allow a company to grow rapidly and can
help to offset the consequences of slow
sales in any one product line
2009 Pearson Education, Inc.

Developing New Products

The New Product Development Process
Research and development (R&D)
Departments for exploring new product
possibilities

Product mortality rates

Few product ideas (1 in 50) actually reach the
market

Speed to market
Responding to customer demand or market
changes by introducing new products to the
market ahead of competitors
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FIGURE 11.2 Products in the Life

Cycle: Stages, Sales, Cost and Profit

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Identifying Products
Branding Products
Branding
A process of using symbols to communicate the
qualities of a particular product made by a
particular producer
Signals uniform quality and stimulates consumer recall

Brand loyalty
Consumer preference for a particular product

Brand awareness
The brand name that comes first to mind when
consumers consider a particular product
category
2009 Pearson Education, Inc.

Identifying Products (contd)

Gaining Brand Awareness
Product placement
A promotional tactic for brand exposure in
which characters in television, film, music,
magazines, or video games use a real
product that is visible to viewers

Buzz marketing
A form of word-of-mouth marketing

Viral marketing
Relying on word-of-mouth and the Internet
to spread information like a virus from
person-to-person about products and ideas
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Identifying Products (contd)

Types of Brand Names
National brands
Products that are produced by, widely distributed by,
and carry the name of the manufacturer

Licensed brands
Companies (and even personalities) license (sell the
rights to) other companies to put their names on
products

Private (or private label) brands

Carry the brand name that a wholesaler or retailer
develops and has a manufacturer put it on a product

2009 Pearson Education, Inc.

 2009 Pearson Education, Inc.

Identifying Products (contd)

Packaging Products
Purposes of packaging
Reduce the risk of damage, breakage, or
spoilage
Increase the difficulty of stealing small products
Serves as an in-store advertisement that makes
the product attractive
Displays the brand name
Identifies features and benefits
Enhances the utility of the product features and
benefits
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The International Marketing

Mix

International Products

Need to adapt product to foreign markets

International Pricing
Higher transportation and selling costs abroad

International Distribution
Distribution network access in foreign markets

International Promotion
Cultural sensitivity requires adjustments to
the marketing mix

2009 Pearson Education, Inc.

Small Business and the Marketing Mix

Small-Business Products
Product failures due to lack of market potential for
products or marketing to the wrong target market
segments

Small-Business Pricing
Losses due to pricing errors resulting from
underestimating operating expenses

Small-Business Distribution
Poor location choice fails to attract customers

Small-Business Promotion
Careful promotion can reduce expenses

2009 Pearson Education, Inc.

Key Terms
brand awareness
brand competition
brand loyalty
branding
capital item
consumer behavior
consumer goods
convenience
good/convenience service
demographic variables
distribution
emotional motives
expense item
geographic variables

industrial goods
industrial market
institutional market
international competition
licensed brand
market segmentation
marketing
marketing manager
marketing mix
marketing plan
national brand
packaging
private brand (or private label)
product

2009 Pearson Education, Inc.

Key Terms (contd)

product differentiation
product feature
product life cycle (PLC)
product line
product mix
product placement
psychographic variables
rational motives
relationship marketing
reseller market
services
shopping good/shopping
service
specialty good/specialty service

speed to market
substitute product
target market
utility
value
value package
viral marketing

2009 Pearson Education, Inc.