Page 329 - Introduction to Business

CHAPTER 8 Marketing Basics 303

Summary

LEARNING OBJECTIVE 1 LEARNING OBJECTIVE 5
Explain the different aspects of the definition of Distinguish between marketing information
marketing. systems and marketing research.
Marketing is defined as the determination of the needs Marketing information systems continually monitor
and desires of markets so that products and services the market, competition, products, and companies’
can be developed, priced, promoted, and distributed to marketing operations. They tell a company how
these markets in order to satisfy the market’s needs and well it is performing. Marketing research is the
desires and organizational objectives can be achieved. process whereby marketers are provided with
information so that effective marketing decisions
LEARNING OBJECTIVE 2 can be made. Marketing research is usually done after
Explain the importance of marketing. a marketing information system has uncovered
a problem.
Virtually every organization engages in marketing
activities. A large portion of the final cost of goods and
LEARNING OBJECTIVE 6
services is composed of marketing costs. Executives of
Identify and understand companies’
organizations are spending more time in marketing.
chief objectives.
Companies realize that marketing is an important key
to improving their profits. Many marketing executives Revenues are a company’s sales expressed in dollars.
are taking over their organizations’ top positions. And Profits are what are left after all of the firm’s costs are
marketing offers challenging and rewarding careers. deducted from its revenues. Profit margin is calculated
by dividing profits by revenues. Dividing a firm’s profits
LEARNING OBJECTIVE 3 by its assets yields return on assets. Return on owners’
Describe the major types of markets and their equity is found by dividing profit by the value of the
importance. owners’ equity. Market share refers to the percentage of
total units sold of a product that is accounted for by a
The major markets to be served are the consumer,
specific company’s products. Market value is found by
business-to-business, government, and international
multiplying the price of a company’s stock by the
markets. Without knowledge of the markets an
number of its shares of stock.
organization is serving, it is difficult for the organization
to achieve its objectives.
LEARNING OBJECTIVE 7
Describe the concept of niche marketing and
LEARNING OBJECTIVE 4
explain the advantages of employing a niche
Identify and describe the components of the marketing strategy.
marketing environment.
A niche marketing strategy involves different products
The marketing environment consists of competition,
or services being offered to different market segments.
technology, the economy, the legal and political arena,
It is successful because it is closely tuned to the needs
and culture. Companies need to establish competitor
of specific markets, markets can be served more
intelligence (CI) programs to monitor their competitors.
quickly, a greater level of focus is achieved, and first-
Companies will want to be developing new technology
mover advantages are obtained.
that will better help them achieve their objectives. They
need to monitor the technology environment to keep
LEARNING OBJECTIVE 8
abreast of new products and processes that are being
Discuss the importance of customer service
developed. Such aspects of the economy as its size,
programs and how they should be conducted.
prices, and distribution of income need to be
understood by marketers. Marketers need to abide by Customer service is believed to be a key in enabling
laws that are in existence, anticipate those that might companies to obtain a sustainable competitive
be passed, and be aware of how laws are being advantage. Effective customer service efforts do not
administered. Organizations need to understand the provide too high a level of service, they stress reliability
culture in their own country but also in foreign countries and have a specific procedure in place to handle
to which they market their products and services. customer complaints.

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