Introduction to Marketing Theory and Practice

by Palmer, Adrian

• ISBN13: 9780199266272
• ISBN10: 0199266271
• Format: Paperback
• Copyright: 2003-04-16
• Publisher: Oxford University Press

Summary

Introduction to Marketing provides a concise introduction to the principles of marketing, offering both critical analysis and applied case studies. Combining academic credibility with an established reputation for his clear writing style, Palmer's book is ideal as a one-semester introductorytitle for students studying at both undergraduate and postgraduate level. The book begins by presenting the underlying theoretical bases of marketing that are often borrowed from the disciplines of economics, sociology and psychology. Practical application of these theories is provided through case studies and vignettes that are included in each chapter. These practicalapplications highlight some of the shortcomings of established frameworks for the study of marketing, and the reader is encouraged to formulate alternative frameworks. This book tries not to present prescriptive solutions to marketing problems, but encourages debate about causes and effects.Underlying much of the discussion in this book is the interplay between marketing as a science and as a creative art. Current developments in the Internet are reflected in the case studies and vignettes in each chapter, and the growing recognition of the social responsibilities of marketing isstressed throughout the book. The book has been divided into fourteen chapters arranged in four parts. In the real world, however, marketing cannot be neatly compartmentalised in this way. With a holistic vision, it will be seen that any change in one aspect of marketing is likely to have consequences on other aspects. Chaptersummaries and case studies help to stress these linkages and provide integrative perspectives. ONLINE RESOURCE CENTRE For lecturers: answers to case study review questions, suggested answers to chapter review questions, additional discussion points, lecturer guidelines to accompany the PowerPoint slides, test bank. For students: additional suggested reading, case studies with case questions, addional chapter review questions, multiple choice questions, web exercises, web links.

Author Biography

Adrian Palmer is Professor of Services Marketing at the University of Gloucestershire. Previously he was Professor of Tourism and Marketing at the University of Ulster.
Prior to joining Academia he held management positions within the transport and travel industry. He has published widely on the subjects of buyer-seller relationships, customer loyalty and service quality. He is a member of the editorial boards for the European Journal of Marketing, Journal of Marketing Management, and Journal of Services Marketing.

Table of Contents

Preface	vii
Guided tour	ix
PART 1 Marketing: the fundamentals
1 What is marketing?	3	(36)
Chapter objectives	3	(1)
Introduction	3	(1)
Marketing as a philosophy and as a set of techniques	4	(3)
Foundations for success in business	7	(5)
Production orientation	9	(1)
Selling orientation	10	(2)
What organizations undertake marketing?	12	(1)
Key marketing concepts	13	(5)
Customers	13	(2)
Needs	15	(1)
Value	16	(1)
Exchange	17	(1)
Markets	18	(1)
The marketing mix	18	(5)
Products	20	(1)
Pricing	20	(1)
Place	21	(1)
Promotion	21	(1)
People	21	(1)
Process	22	(1)
Physical evidence	22	(1)
Interdependency of the marketing mix	22	(1)
Marketing management	23	(2)
The marketing management process	23	(1)
Marketing management structures	23	(1)
Outcomes of the marketing management process	24	(1)
Marketing and its relationship to other business functions	25	(1)
Marketing and social responsibility	26	(1)
Is marketing a science or an art?	27	(2)
Marketing as an academic discipline	29	(1)
What makes a good marketer?	30	(1)
Chapter summary and linkages to other chapters	31	(1)
Case study: Can the Body Shop survive without marketing?	32	(7)
2 The marketing environment	39	(48)
Chapter objectives	39	(1)
Introduction	39	(2)
The micro-environment	41	(10)
Customers	41	(1)
Competitors	42	(1)
Intermediaries	43	(1)
Suppliers	44	(1)
Government	44	(1)
The financial community	45	(1)
Local communities	45	(1)
Pressure groups	45	(1)
Value chains	46	(2)
Relationships between members of an organization's micro-environment	48	(2)
Communication within the micro-environment	50	(1)
The macro-environment	51	(15)
The macroeconomic environment	51	(4)
Economic growth and the distribution of income	52	(1)
Multiplier and accelerator effects	52	(1)
Business cycles	53	(2)
Market competitiveness	55	(1)
The political environment	55	(1)
The social and cultural environment	56	(4)
The demographic environment	60	(3)
The technological environment	63	(1)
The ecological environment	64	(2)
Monitoring and responding to environmental change	66	(2)
SWOT analysis	67	(1)
The internal environment	68	(6)
The flexible organization	71	(3)
Marketing ethics	74	(2)
Corporate governance	76	(1)
Chapter summary and linkages to other chapters	77	(2)
Case study: Smoking may be bad, but tobacco companies' profits have never looked so good	79	(8)
PART 2 Understanding customers
3 Buyer behaviour and relationship development	87	(40)
Chapter objectives	87	(1)
Introduction	87	(2)
Buying situations	88	(1)
The buying process	89	(14)
Needs as buying process initiators	90	(6)
Physiological and psychological bases of needs	90	(3)
Sociological influences on needs	93	(1)
Situational factors influencing needs	94	(2)
Information search	96	(2)
Perception	96	(2)
Evaluation	98	(3)
Decision	101	(1)
Post-purchase evaluation	101	(1)
Cognitive dissonance	101	(2)
The decision-making unit (DMU)	103	(3)
Influencers	104	(1)
Gatekeepers	104	(1)
Buyers	105	(1)
Users	105	(1)
Decision maker	105	(1)
Models of buyer decision-making	106	(3)
Personal and organizational buyer behaviour compared	109	(1)
Developing ongoing relationships with buyers	110	(10)
Reasons for the development of ongoing customer relationships	112	(2)
What is relationship marketing?	114	(3)
Methods used to develop ongoing relationships with customers	117	(2)
Customer satisfaction	117	(1)
Trust	118	(1)
Adding value to a relationship	118	(1)
Creating barriers to exit	119	(1)
Problems of creating ongoing relationships with buyers	119	(1)
Chapter summary and linkages to other chapters	120	(1)
Case study: Research company tries to show that you can only understand consumer behaviour by living with their behaviour	121	(6)
4 Marketing research	127	(38)
Chapter objectives	127	(1)
Introduction	127	(1)
Market research v. marketing research	128	(1)
Major uses of marketing research	129	(2)
The marketing research process	131	(2)
Primary v. secondary research	133	(3)
Secondary research information sources	136	(1)
Primary research methods	137	(6)
Sampling procedures	138	(1)
Data collection methods	139	(4)
Observation techniques	139	(2)
Survey-based research methods	141	(2)
Quantitative v. qualitative research	143	(7)
Quantitative research	143	(5)
Correlation analysis	144	(1)
Regression analysis	145	(1)
Analysis of variance	146	(1)
Conjoint analysis	146	(1)
Cluster analysis	146	(1)
Neural network analysis	147	(1)
Limitations to quantitative techniques	147	(1)
Sampling error	147	(1)
Measurement error	147	(1)
Significance level	148	(1)
Inappropriate tests	148	(1)
Inappropriate interpretation	148	(1)
Qualitative research	148	(2)
Who carries out marketing research?	150	(1)
Marketing intelligence	151	(1)
Knowledge management	152	(3)
Demand forecasting	155	(2)
Chapter summary and key linkages to other chapters	157	(1)
Case study: Market research companies run out of information	158	(7)
5 Segmentation positioning and targeting	165	(42)
Chapter objectives	165	(1)
Why segment markets?	165	(3)
Criteria for effective segmentation	168	(4)
Is the basis of market segmentation useful to the company?	168	(1)
Are the segments of an economic size?	169	(1)
Can the market segments be measured?	170	(1)
Are the segments accessible to the company?	171	(1)
Bases for market segmentation	172	(15)
Demographic bases for segmentation	172	(7)
Age	173	(1)
Family life-cycle	174	(2)
Gender	176	(1)
Ethnic group	177	(1)
Household composition	178	(1)
Socio-economic bases for segmentation	179	(2)
Occupation	179	(1)
Income	180	(1)
Psychographic bases for segmentation	181	(3)
Life-styles	181	(1)
Attitudes	182	(1)
Values	183	(1)
Benefits sought	184	(1)
Loyalty	184	(1)
Geodemographic bases for segmentation	184	(1)
Situational bases for segmentation	184	(2)
Stage in buying process	185	(1)
Occasion of use	185	(1)
Frequency of purchase	185	(1)
Comprehensive approaches to segmentation	186	(1)
Bases for segmenting business markets	187	(1)
Size of firm	187	(1)
Formality of buying processes	188	(1)
Industry sector	188	(1)
Evaluating market segments	188	(4)
Size of segment	188	(1)
Growth prospects	189	(1)
Profitability	189	(1)
Competition for the segment	189	(1)
Fit with company objectives	190	(2)
Selection of target markets	192	(5)
Undifferentiated mass marketing	193	(1)
Single-segment specialization ('niche' marketing)	194	(1)
Multiple-segment specialization	195	(1)
Segment development plans	196	(12)
Market attractiveness analysis	196	(1)
Developing a position within the target market	197	(2)
Chapter summary and linkages to other chapters	199	(1)
Case study: Polaroid focuses its cameras on new market segments	200	(7)
PART 3 Developing the marketing mix
6 Competitor analysis and the development of a brand	207	(40)
Chapter objectives	207	(1)
Introduction	207	(1)
Who are a company's competitors?	208	(4)
The threat of new entrants	210	(1)
The threat of substitute products	211	(1)
Intensity of rivalry between competing firms	211	(1)
The power of suppliers	211	(1)
The power of buyers	212	(1)
Branding	212	(2)
The history of branding	214	(3)
Key characteristics of a brand	217	(4)
Consistency	217	(2)
Risk reduction	219	(1)
Functional and emotional attributes	219	(2)
Creating a distinctive brand	221	(5)
Choice of name	221	(2)
Distinctive product features	223	(1)
Creation of a distinctive brand personality	224	(1)
Distinctive visual identity	224	(2)
Branding strategy	226	(4)
Development of a single strong brand	227	(2)
Differentiated brands	229	(1)
Brand families	229	(1)
Brand extension	229	(1)
Co-branding	230	(1)
Protecting a brand	230	(2)
The changing role of branding	232	(3)
The end of branding?	232	(1)
The emergence of retailers' own brands	233	(1)
The organization as a brand	233	(1)
The development of global brands	234	(1)
Positioning the brand	235	(5)
Repositioning	239	(1)
The marketing mix	240	(1)
Chapter summary and key linkages to other chapters	240	(1)
Case study: Fairy's brand bubble never seems to burst	241	(6)
7 Developing the product	247	(46)
Chapter objectives	247	(1)
What do we mean by a product?	247	(6)
Material goods	249	(2)
Consumer goods	249	(1)
Business-to-business goods	250	(1)
Intangible services	251	(2)
Ideas	253	(1)
Locations and people	253	(1)
Analysis of the product offer	253	(1)
The product mix	254	(1)
Quality	255	(2)
Technical and functional quality	256	(1)
Distinctive design	257	(1)
Packaging	258	(1)
'Greening' the product range	259	(2)
The product life-cycle	261	(5)
The product life-cycle and consumer adoption processes	263	(2)
Limitations of product life-cycle theory	265	(1)
Innovation and new product development	266	(5)
What is innovation?	267	(1)
What are new products?	267	(4)
Product modifications	267	(1)
Innovative products	268	(3)
The new product development process	271	(7)
Idea generation	271	(1)
Idea screening	272	(2)
Concept development and testing	274	(1)
Business analysis	274	(1)
Product development and testing	275	(1)
Market testing	275	(1)
Product launch	275	(2)
Integrating the new product development process	277	(1)
Strategic issues in expanding the product range	278	(2)
Planning for growth	280	(2)
Deleting products	282	(3)
Chapter summary and linkages to other chapters	285	(1)
Case study: Crossed line in new phone development	286	(7)
8 Pricing	293	(50)
Chapter objectives	293	(1)
Introduction	293	(1)
Effects of market structure on pricing	294	(2)
The theory of supply and demand	296	(15)
Demand	297	(3)
Supply	300	(2)
Price determination	302	(1)
Imperfections to competition	303	(2)
Operating at a lower cost	304	(1)
Differentiating the product	304	(1)
Elasticity of demand	305	(4)
Oligopoly	309	(1)
Monopolistic markets	310	(1)
Regulatory influences on pricing	311	(2)
Direct government controls to regulate monopoly power	311	(1)
Government controls on price representations	312	(1)
Pricing objectives of companies	313	(3)
Profit maximization	314	(1)
Sales growth	314	(1)
Survival	315	(1)
Social considerations	316	(1)
Pricing strategy	316	(2)
Pricing and the product life-cycle	317	(1)
Customer lifetime pricing	317	(1)
Price-skimming strategy	318	(2)
Penetration pricing strategy	320	(2)
Pricing methods	322	(12)
Cost-based pricing	322	(2)
Marginal cost pricing	324	(1)
Competitors and pricing	325	(3)
Demand-based pricing	328	(6)
Price discrimination between different groups of buyers	328	(2)
Price discrimination by point of sale	330	(1)
Price discrimination by type of use	331	(1)
Price discrimination by time of purchase	331	(1)
Bartering and auctions	332	(2)
Pricing a product range	334	(1)
Price bundling	335	(1)
The pricing of public services	335	(2)
Chapter summary and linkages to other chapters	337	(1)
Case study: A single market-so why no single price?	338	(5)
9 Distribution	343	(56)
Chapter objectives	343	(1)
Introduction	343	(1)
What is a marketing channel?	344	(1)
The distribution environment	345	(1)
The role of intermediaries in a value chain	345	(2)
Functions of intermediaries	347	(3)
Types of intermediary	350	(1)
Classification of retailers	350	(3)
Designing a channel of distribution	353	(1)
Influences on channel selection	354	(2)
Channel alternatives	356	(1)
Multiple channels	357	(1)
Selecting specific intermediaries	358	(1)
Channel conflict	358	(2)
Channel competition	360	(1)
Vertical marketing systems	361	(2)
Franchising systems	362	(1)
Global retailing	363	(1)
The internet and channel design	364	(3)
Physical distribution management	367	(2)
Physical distribution objectives	369	(1)
Customer service in logistics	369	(2)
Marketing logistics	371	(1)
Identification of segments by service requirements	372	(1)
Cost/service trade-offs	373	(1)
Inventory management	374	(2)
Just-in-time systems	376	(1)
Information processing	377	(3)
Order processing	378	(1)
Materials planning	379	(1)
Delivery planning	379	(1)
IT and organizational processes	379	(1)
Production and warehouse location	380	(2)
Transport	382	(2)
Road	382	(1)
Rail	382	(2)
Air	384	(1)
Water	384	(1)
Pipeline	384	(1)
Global logistics	384	(3)
Trends in logistics management	387	(3)
From functions to processes	387	(1)
Competition between supply networks	388	(1)
Closer working relationships	388	(1)
Fewer channel members	388	(1)
Virtual organizations	388	(1)
Increasingly complex conumer needs	389	(1)
The internet	389	(1)
Increasing public concern over the environment	390	(1)
Chapter summary and key linkages to other chapters	390	(1)
Case study: Online music gives rise to distribution headaches	391	(8)
10 Introduction to promotion planning	399	(1)
Chapter objectives	399	(1)
The role of promotion planning as an integral part of the marketing and business planning process	399	(1)
Marketing and promotional objectives	400	(2)
The communication process	402	(1)
The message source	403	(2)
The message	405	(8)
Encoding, decoding, and noise	407	(6)
Perception and retention of the message	413	(1)
The target audience	413	(8)
Audience data	414	(1)
Business-to-business audiences	414	(1)
Positioning in the mind of the target audience	415	(1)
Buyer readiness state	416	(1)
Push v pull messages	417	(1)
Other important audiences for communication	418	(3)
The channel	421	(1)
Response: marketing communications models	421	(5)
'Hierarchy of effects' models	422	(1)
Integrated models	423	(1)
Communication and buyer behaviour models	424	(2)
Introducing the promotion mix	426	(8)
The promotion mix and the product life-cycle	428	(1)
Advertising	429	(1)
Selling and sales management	429	(1)
Sales promotion	429	(1)
Public relations	430	(1)
Sponsorship	430	(1)
Direct marketing	430	(1)
Online marketing	431	(1)
Word of mouth	432	(1)
Other sources of messages	432	(2)
Stages of the promotion planning process	434	(4)
The promotion campaign	437	(1)
The role of promotion agencies	437	(1)
Setting budgets for promotional activity	438	(3)
Monitoring and evaluating the promotional effort	441	(1)
Chapter summary and links to other chapters	442	(1)
Case study: Ethical values used to position bank	443	(6)
11 Developing the promotion mix	449	(1)
Chapter objectives	449	(1)
Advertising	449	(14)
The role of advertising in the promotion mix	449	(1)
How does advertising work?	450	(2)
Determining advertising objectives	452	(1)
Advertising media	452	(6)
Characteristics of advertising media	453	(5)
Media selection and evaluation	458	(6)
Advertising exposure	458	(1)
Advertising impact	459	(1)
Wearout	459	(1)
Cost	459	(4)
Constraints on advertising	463	(1)
Personal selling	464	(10)
Types of selling	465	(1)
Tasks of a salesperson	466	(1)
Principles of personal selling	467	(1)
Elements of the selling process	468	(2)
Prospecting and targeting	469	(1)
Preparation	469	(1)
The sales presentation	469	(1)
Business-to-business selling: the complex sale	470	(1)
Key account management	471	(3)
Sales promotion	474	(6)
Planning for sales promotion	475	(1)
Sales promotion tools	476	(4)
Public relations	480	(8)
The role of public relations in the promotion mix	480	(1)
Public relations and corporate reputation	481	(1)
The characteristics of public relations	482	(1)
The publics of public relations	482	(2)
The tools of public relations	484	(1)
Press relations	485	(1)
Evaluating public relations activity	486	(2)
Sponsorship	488	(1)
Direct marketing	488	(19)
Defining direct marketing	488	(3)
Key features of direct marketing	491	(2)
The development of customer databases	493	(4)
Developing a database from internal leads	493	(1)
Buying in mailing lists	494	(1)
Maintaining a database	495	(2)
Profiling and targeting	497	(3)
Direct marketing media	500	(1)
Direct mail	501	(1)
Telemarketing	502	(1)
Newspaper/magazine/television advertising	503	(1)
Door-to-door	504	(1)
Electronic media	504	(1)
Limitations to the development of direct marketing	505	(2)
Cost effectiveness	506	(1)
Legislative constraints	506	(1)
Diminishing returns	507	(1)
Online marketing	507	(6)
Objectives and development of online media	508	(3)
Viral marketing	511	(1)
Website evaluation	511	(1)
Limitations of online media	512	(1)
Chapter summary and linkages to other chapters	513	(1)
Case study: Free flights promotion ends in disaster	514	(9)
PART 4 Bringing it together
12 Managing the marketing effort	523	(100)
Chapter objectives	523	(1)
Introduction	523	(1)
The marketing management process	524	(4)
Strategic, tactical, and contingency planning	528	(1)
The dynamic marketing environment	528	(1)
Marketing planning and corporate planning	529	(1)
Planning as an inter-functional integrator	529	(2)
The mission statement	531	(1)
Organizing the marketing management function	532	(4)
Management by functional responsibility	534	(1)
Management by geographical responsibility	535	(1)
Management by product type	535	(1)
Management by market segment	536	(1)
Integrating marketing management with other management functions	536	(4)
The matrix approach to management	538	(2)
Business process re-engineering	540	(1)
Marketing management and smaller businesses	540	(4)
Internal market places	544	(1)
Leadership	545	(1)
Managing information	546	(5)
Using information for control	549	(2)
Improving organizational effectiveness for marketing	551	(2)
Chapter summary and key linkages to other chapters	553	(1)
Case study: Marketing a tourism destination: an organizational challenge for local authorities	554	(5)
13 The marketing of services	559	(1)
Chapter objectives	559	(1)
Introduction	559	(1)
The importance of the services sector	560	(1)
What are services?	561	(6)
Intangibility	561	(2)
Inseparability	563	(2)
Variability	565	(1)
Perishability	566	(1)
Impossibility of being owned	567	(1)
Goods and services compared	567	(1)
Classifying services	568	(6)
Degree of intangibility	572	(1)
Producer v consumer services	572	(1)
Status of the service within the total product offer	572	(1)
Extent of inseparability	572	(1)
Pattern of service delivery	573	(1)
Extent of people orientation	573	(1)
Significance of the service to the purchaser	573	(1)
Marketable v unmarketable services	573	(1)
Multiple classifications	574	(1)
An extended marketing mix for services	574	(9)
Products	576	(1)
Pricing	577	(1)
Promotion	578	(1)
Place	579	(1)
People	579	(2)
Processes	581	(1)
Physical evidence	582	(1)
Chapter summary and linkages to other chapters	583	(1)
Case study: Ford cars go in for a service	583	(6)
14 Global marketing	589	(1)
Chapter objectives	589	(1)
Introduction	589	(2)
Why export?	591	(2)
National reasons for trade occurring	591	(1)
Firms' reasons for developing foreign trade	592	(1)
A note on exporting of services	593	(1)
Analysing foreign marketing opportunities	594	(7)
Political factors	594	(2)
Economic factors	596	(1)
Social factors	597	(1)
Technological factors	598	(1)
A more detailed analysis of potential markets	599	(2)
Adapting the product offer to foreign markets	601	(7)
Pricing in foreign markets	605	(1)
Distributing goods and services in foreign markets	606	(2)
People decisions	608	(1)
Market entry strategies	608	(6)
Time-scale for foreign market development	609	(1)
Who should be involved in foreign market development?	609	(5)
Exporting directly to customers overseas	610	(1)
Exporting through an export/import agent	610	(1)
Direct investment in a foreign subsidiary	610	(1)
Licensing/franchising	611	(1)
Joint ventures	611	(1)
Strategic alliances	612	(2)
Global e-commerce	614	(1)
Chapter summary and key linkages to other chapters	615	(1)
Case study: The Czech beer market-a bitter sweet venture for Bass	616	(7)
Glossary	623	(8)
Index	631