1.
TOURISM AND HOSPITALITY
DTM5043
POLYTECHNICS
MINISTRY OF EDUCATION MALAYSIA
DEPARTMENT OF TOURISM AND HOSPITALITY

2.
 Marketing Defined:
“Marketing is a social and managerial process by which individuals and groups
obtain what they need and want through creating and exchanging value with
others”
Marketing is about managing profitable customer relationships
- Attracting new customers
- Retaining and growing current customers

3.
The Marketing Process
A Five-Step Process
1. Understand the marketplace and customer
needs and wants
1. Understand the marketplace and customer needs
2. Design and wants
a customer-driven marketing strategy
3. Construct a marketing program that delivers
2. Design a customer-driven marketing strategy
3. Construct a marketing program that delivers
superior value
superior value
4. Build profitable relationships and create
4. Build profitable relationships and create customer
customer delight
delight
5. Capture 5. Capture value value from customers customers to create to create
profits
profits and customer and customer quality
quality

4.
Understanding the Marketplace
Core Concepts
Needs, wants, and demands
• Need
– State of felt deprivation
– Example: Need food
• Wants
– The form of needs as shaped by culture and the individual
– Example: Want a Big Mac
• Demands
– Wants which are backed by buying power

5.
Understanding the Marketplace
Core Concepts
Marketing offers: including products, services
and experiences
• Marketing offer
– Combination of products, services, information or experiences that
satisfy a need or want
– Offer may include services, activities, people, places, information or
ideas

6.
Understanding the Marketplace
Core Concepts
Value and satisfaction
• Value
– Customers form expectations regarding value
– Marketers must deliver value to consumers
• Satisfaction
– A satisfied customer will buy again and tell others about their good
experience

7.
Understanding the Marketplace
Core Concepts
Exchange, transactions and relationships
• Exchange
– The act of obtaining a desired object from someone by offering
something in return
– One exchange is not the goal, relationships with several exchanges are
the goal
– Relationships are built through delivering value and satisfaction

8.
Understanding the Marketplace
Core Concepts
Markets
• Market
– Set of actual and potential buyers of a product
– Marketers seek buyers that are profitable

9.
Marketing Management
• Marketing management is the art and science
of choosing target markets and building
profitable relationships with them.
– This definition must include answers to two
questions:
• What customers will we serve?
• How can we serve these customers best?

10.
Selecting Customers and Creating
Value
• Customer Management
– What customers will we serve?
– Marketers select customers that can be served profitably
• Value Proposition
– How can we serve these customers best?
– Includes the set of benefits or values a company promises
to deliver to consumers to satisfy their needs

11.
Marketing Orientations
Marketing Orientations
Production concept
Product concept
Selling concept
Marketing concept
Societal marketing concept

12.
MARKETING CONCEPTS
Introduction:
What philosophy should guide a company
marketing and selling efforts?
What relative weights should be given to the
interests of the organization, the customers, ang
society? These interest often clash, however, an
organization’s marketing and selling activities
should be carried out under a well-thought-out
philosophy of efficiency, effectiveness, and socially
responsibility.

13.
The Production Concept
• This concept is the oldest of the concepts in business.
• It holds that consumers will prefer products that are
widely available and inexpensive.
• Managers focusing on this concept concentrate on
achieving high production efficiency, low costs, and
mass distribution.
• They assume that consumers are primarily interested
in product availability abd low prices.
• This orientation makes sense in developing countries,
where consumers are more interested in obtaining the
product than in its features.

14.
The Product Concept
• This orientation holds that consumers will favor those
products that offer the most quality, performance, or
innovative features.
• Managers focusing on this concept concentrate on making
superior product and improving them over time.
• They assume that buyers admire well-made product and
can appraise quality and performance.
• However, these managers are sometimes caught un in love
affair with their product and do not realize what the market
needs.
• Management might commit the “better-mousetrap”
fallacy, believing that a better mousetrap will lead people
to beat a path to its door.

15.
The Selling Concept
• This another common business orientation.
• It holds that consumers and businesses, if left alone, will
ordinarily not buy enough of the selling company’s product.
• The organization must, therefore, undertake an aggressive
selling and promotion effort.
• This concept assumes that consumers typically show buying
inertia or resistance and must be coaxed into buying.
• It also assumes that the company has a whole battery of
effective selling and promotional tools to stimulate more
buying.
• Most firms practice the selling concept when they have
overcapacity. Their aim is to sell what they make rather
than make what the market wants.

16.
The Marketing Concept
• This is a business philosophy that challenges the above three business
orientations.
• Its central tenets crystallized in the 1950s. It holds that the key to
achieving its organizational goals (goals of the selling company) consists of
the company being more effective than competitors in creating, delivering
and communicating customer value to its selected target customers. The
marketing concept rest on four pillars: target market, customer needs,
integrated marketing and profitability.
• The Marketing Concept represents the major change in today’s company
orientation that provides the foundation to achieve competitive
advantage. This philosophy is the foundation of consultative selling.
• The marketing concept has evolved into a fifth and more refined company
orientation: The Societal Marketing Concept.
• This concept is more theoretical and will undoubtedly influence future
forms of marketing and selling approaches.

17.
The Societal Marketing concept
• This concept holds that the organization’s task is to determine the needs,
want, and interests of target markets and to deliver the desired
satisfactions more effectively and efficiently than competitors (this is the
original Marketing Concept).
• Additionally, it holds that this all must be done in a way that preserves or
enchances the consumer’s and the society’s well-being.
• This orientation arose as some questioned whether the Marketing
Concept is an appropriate philosophy in an age of environmental
deterioration, resource shortages, explosive population growth, world
hunger and poverty, and neglected social services.
• Are companies that do an excellent job of satifying consumer wants
nesessarily acting in the best long-run interests of consumers and society?
• The marketing concept possibily sidesteps the potential conflicts among
consumer wants, consumer interests, and long-run societal welfare.

18.
The Marketing Plan
• Transforms the marketing strategy into action
• Includes the marketing mix and the 4P’s of
marketing
– Product
– Price
– Place
– Promotion

19.
Building Customer Relationships
• CRM – Customer relationship management
• The overall process of building and
maintaining profitable customer relationships
by delivering superior customer value and
satisfaction. It deals with all aspects of
acquiring, keeping and growing customers.

20.
Value and Satisfaction
• Perceived Value
Perceived Value
– The customer’s evaluation of the difference
between benefits and costs.
– Customers often do not judge values and costs
accurately or objectively.
- The customer’s evaluation of the
difference between benefits and
costs.
- Customers often do not judge values
and costs accurately or objectively.
• Customer Satisfaction
– Product’s perceived performance relative to
customer’s expectations
Customer Satisfaction
- Product’s perceived performance
relative to customer’s expectations

21.
Not All Customers
are Equal
• Basic Relationships
– Low-margin customers
• Full Partnerships
– Key customers
• Selective relationship management
– Weeding out unprofitable customers

22.
Capturing Value from Customers
Key Concepts
• Customer Loyalty and Retention
• Customer delight leads to emotional
relationships and loyalty
• Customer Lifetime Value shows true worth of
a customer

23.
Capturing Value from Customers
Key Concepts
• Share of Customer
• Share of customer’s purchase in a product
category.
• Achieved through offering greater variety,
cross-sell and up-sell strategies.

24.
Capturing Value from Customers
Key Concepts
• Customer Equity
• The combined customer lifetime values of all
current and potential customers.
• Measures a firm’s performance, but in a
manner that looks to the future.
• Choosing the “best” customers is key

25.
Marketing Landscape
Challenges
• Digital age
• Growth of the Internet
• Advances in telecommunications, information,
transportation
– Customer research and tracking
– Product development
– Distribution
– New advertising tools
– 24/7 marketing through the Internet

26.
Marketing Landscape
Challenges
• Globalization
• Geographical and cultural distances have
shrunk
– Greater market coverage
– More options for purchasing and manufacturing
– Increased competition from foreign competitors

27.
Marketing Landscape
Challenges
• Ethics and social responsibility
• Marketers need to take great responsibility for
the impact of their actions
– Caring capitalism is a way to differentiate your company

28.
Marketing Landscape
Challenges
• Not-for-profit marketing
• Many organizations are realizing the
importance of strategic marketing
– Performing arts
– Government agencies
– Colleges
– Hospitals
– Churches

29.
Marketing Landscape
Challenges
• Marketing relationships
• Profits through managing long-term customer
equity
– Improve customer knowledge
– Target profitable customers
– Keep profitable customers

30.
What is Marketing
The process of building profitable customer
relationships by creating value for customers
and capturing value in return