Marketing in Profit and Nonprofit Settings

Explain the types of utility and the role marketing plays in their creation.

      Utility is the want&-satisfying power of a good or service.  There are four basic kinds of utility: form, time, place, and ownership. Form utility refers to the conversion of raw materials and component parts into finished products. Although marketing provides information about consumer wants and needs, the actual creation of form utility is the responsibility of the production function. In contrast, marketing creates time, place and ownership utilities. These utilities refer to making goods and services available when and where people want to buy them, and providing facilities for the transfer of title.

Relate the definition of marketing to the concept of the exchange process.

      The American Marketing Association has defined marketing as the process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods, and services to create exchanges that satisfy individual and organizational objectives. The exchange process, by which two or more parties give something of value to each other to satisfy felt needs, is a critical aspect of this definition.

Contrast marketing activities during the three eras in the history of marketing.

      Firms were production oriented during the production era; the prevailing attitude was that quality products would sell themselves. Marketing was a secondary activity. In the sales era, the emphasis was on convincing people to buy Marketing was in essence, defined as selling. The marketing era saw the emergence of the marketing concept, a company wide consumer orientation with the objective of achieving long&-run success.

Explain the concept of marketing myopia.

      Both production and sales oriented firms frequently do not achieve long&-run success because they define the scope of their business around the product rather than customers' needs The term marketing myopia was coined by Harvard marketing professor Theodore Levitt to describe this failure of the marketer to recognize the scope of the business. Future growth of an organization is endangered when management is myopic this way&-that is, product rather than customer oriented.

Identify and briefly explain the types of nonprofit marketing.

      There are four types of nonprofit marketing. Person marketing focuses on an individual, such as a celebrity or political candidate. Place marketing attempts to attract people and/or businesses to a particular geographical area&-city, state, or country. Idea marketing involves identifying and marketing a cause or idea to chosen consumer segments. Organization marketing refers to marketing efforts to influence others to accept the organization's goals or services or contribute to it in some way. Organization marketing is undertaken by  (1) mutual&-benefit organizations, such as churches, labor unions, and political parties; (2) service organizations, such as colleges, universities, hospitals, and museums; and (3) government organizations, such as the military services and police and fire departments.

Identify the basic elements of a marketing strategy and the environmental factors that influence strategy decisions.

      The two major variables in a marketing strategy are (1) analysis, evaluation, and selection of a target market and (2) the development of a marketing mix designed to satisfy the chosen target market. Marketing begins with an assessment of consumer wants and needs, the collection of information about potential consumer segments to be satisfied, and the ultimate choice of a consumer segment that will serve as the firm's target market. Once the target market has been selected, the marketing manager directs activities toward its satisfaction. The four strategy elements in marketing decision making are product strategy, pricing strategy, distribution strategy, and promotional strategy. The combination of these four elements is called the marketing mix. The five components of the marketing environment are the competitive environment,the political&-legal environment, the economic environment, the technological environment, and the social&-cultural environment.

Explain the universal functions of marketing.

      Marketing is responsible for the performance of eight universal functions as it creates time, place, and ownership utilities. Some of these functions are performed by manufacturers, others by retailers, and still others by marketing intermediaries such as wholesalers. The eight functions may be divided into three broad categories: (1) exchange functions (buying and selling); (2) physical distribution functions (transporting and storing); and (3) facilitating functions (standardization and grading, financing, risk taking, and securing marketing information).

List three reasons for studying marketing.

      Three basic reasons for studying marketing are (1) marketing costs may account for the greatest percentage of the consumer's personal expenditures; (2) there is a good chance that individual students will become marketers; (3) marketing provides an opportunity to contribute to society as well as to an individual organization.