1. Chapter 13
Learning Objectives
After completing this chapter, you’ll be
able to:
1. List the functions of marketing.
2. Identify the importance of market
research.
3. Explain how channels of distribution
work.
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2. Chapter 13
Basics of Marketing
A market is a group of customers who
share common wants and needs, and
who have the ability to purchase a
particular product.
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3. Chapter 13
Basics of Marketing
Marketing is the process of creating,
promoting, and presenting a product to
meet the wants and needs of
consumers.
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4. Chapter 13
Basics of Marketing
Businesses want you to buy their
product so they perform detailed
research on markets to find and
analyze potential customers in their
market. This is called target
marketing.
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5. Chapter 13
Functions of Marketing
A popular trend in today’s marketing
world is relationship marketing.
Companies use this strategy to build
customer relations.
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6. Chapter 13
Marketing Mix
The four elements of marketing—
product, place, price, and promotion—
are called the marketing mix, or the
four Ps.
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7. Chapter 13
Product
Marketing is used first to find out if
there is a demand for a product.
Then it is concerned with how to
present a product to the customer to
make it as appealing as possible.
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8. Chapter 13
Place
One of the first things marketers have
to consider is where to sell a product.
Then marketers have to consider in
what kind of location to sell their
product.
The placement of the product in a
store is important.
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9. Chapter 13
Price
To determine the price of a product a
marketer considers three questions:
1. How much are customers willing to
pay?
2. Is the price competitive with other
products?
3. Can the company make a profit?
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10. Chapter 13
Price
The break-even point is the amount
of money a company has to make on a
product to pay for its costs.
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11. Chapter 13
Promotion
Promotion consists of making
customers aware of a product.
The most familiar form of promotion is
advertising.
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12. Chapter 13
Promotion
Some marketers offer discounts in the
form of coupons, rebates, and sales.
Another way companies promote their
products is through public relations, or
publicity. – Grammy’s/Golden Globes
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13. Chapter 13
Fast Review
1. What is marketing?
2. What are a few functions of
marketing?
3. Name the marketing mix, or the four Ps.
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14. Chapter 13
Market Research
Companies do market research to
gather and study information about
consumers to determine what kinds of
goods and services to produce.
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15. Chapter 13
Market Research
Demographics are facts about the
population in terms of age, gender,
location, income, and education.
Once marketers know the demo-
graphics of a market, they can develop
products for it.
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16. Chapter 13
Product Development
The seven steps for developing a new
product are:
1. Generating ideas
2. Screening ideas
3. Developing a business proposal
continued
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17. Chapter 13
Product Development
4. Developing the product
5. Test marketing the product
6. Introducing the product
7. Evaluating customer acceptance
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18. Chapter 13
Fast Review
1. What’s the purpose of market
research?
2. Name the seven steps in
developing a new product.
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19. Chapter 13
Channels of Distribution
A channel of distribution is a
particular way to direct products to
consumers.
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20. Chapter 13
Channels of Distribution
Direct distribution occurs when the
goods or services are sold from the
producer directly to the customer.
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21. Chapter 13
Channels of Distribution
Indirect distribution involves one or
more intermediaries.
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22. Chapter 13
Channels of Distribution
The biggest impact distribution has on
marketing is how it affects the price of
products.
Each time a product goes through
another channel of distribution, the
cost of marketing increases.
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23. Chapter 13
Channel Members
Moving the product from manufacturer
to the final user is an intermediary, or
a go-between.
Intermediaries include distributors,
wholesalers, retailers, and even the
Internet.
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24. Chapter 13
Channel Members
A distributor represents a single
manufacturer in a geographic area.
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25. Chapter 13
Channel Members
A wholesaler receives large
shipments of products from many
different producers.
Wholesalers break the shipments into
smaller batches for resale.
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26. Chapter 13
Channel Members
A retailer sells goods directly to the
customer.
This is the final stop in the channel of
distribution.
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27. Chapter 13
Fast Review
1. Channels of distribution are
classified in which two ways?
2. How does distribution affect the
prices of products?
continued
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28. Chapter 13
Fast Review
3. What are the major types of
intermediaries?
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29. Chapter 13
Do you show product loyalty?
If so, what brands are you
loyal to? Why?
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