Page 303 - Introduction to Business

CHAPTER 8 Marketing Basics 277

How involved are you with marketing? It’s all around you. When you purchase
new clothes, when you see an advertisement on television or in a magazine, when
a truck delivers your new furniture, when you receive a sample of soap in the mail,
when an automobile dealer gives you a $1000 rebate on a new car, when you are
asked over the telephone to answer a few questions about how you spend your
money, you are involved with marketing.

LEARNING OBJECTIVE 2
Explain the importance of marketing.
How important is marketing? Virtually every organization, whether it be business or
nonbusiness, engages in marketing. A large percentage of the final cost of goods
and services is composed of marketing costs. Executives of organizations are
spending more time in marketing. Companies are realizing that a greater emphasis
on marketing can improve their profits. This is why DaimlerChrysler’s chief execu-
tive officer, Dieter Schrempp, hired Jim Schroeder from Ford; the company wanted
a greater emphasis on marketing so that it would obtain a maximum profit on each
3
vehicle. Many high-tech dotcoms, saddled with poor results, began to hire experi-
enced marketing executives. For example, Autobytel.com, which sells automotive
services over the Web, added a chief marketing executive (CME) in 2000. More and
more chief marketing executives are rising to the top spot in their companies, even-
tually becoming the chief executive officer (CEO) or even chairperson. Companies
realize that marketing factors are often the most important in mergers and acquisi-
tions and in ensuring their success. Marketing is a key to successfully selling
products and services outside the United States. The consulting firm McKinsey &
Company estimates that 80 percent of the world’s business by 2027 will be sold
across international borders. Michael Dell, CEO of Dell Computers, the world’s
4
largest maker of personal computers, confirmed the importance of the interna-
tional market with Business Week when he said: “Then, there’s globalization. We have
about 22 percent share in 45 percent of the market. We have only 5 percent in the
other 55 percent of the market. So there’s a big opportunity to grow outside of the
top four or five countries of the world.” And, finally, from an employment per-
5
spective, marketing offers challenging and financially rewarding careers for enthu-
siastic and hardworking men and women.
reality Some people say that a society does not need marketing. How would
CH ECK you respond to this belief?

Markets

LEARNING OBJECTIVE 3
Describe the major types of markets and their importance.
No marketing professional can be successful without knowledge of the various
markets that his or her company is trying to reach. For firms in the twenty-first cen-
tury, the most important markets are the consumer, business-to-business, govern-
ment, and international markets.

Consumer Market

The consumer market consists of people and households. In 2000 in the United consumer market People and
States, there were 281 million people and 103 million households. Population households that purchase consumer
products and services
and household figures are important to marketers; the larger the population and

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