Principles of Marketing Lecture

PRINCIPLES OF MARKETING
MRS. MARIBETH H. ANDINO MBM 10/18/2019 1

CHAPTER I – AN OVERVIEW OF MARKETING

CONCEPT OF MARKETING
MARKETING
process of continuously and profitably satisfying target customer’s needs,
wants and expectations superior to competition.

THE STRATEGIC 3 C'S OF MARKETING AND KEY
OBJECTIVES
1. Customers To competently satisfy the

needs, wants and expectation of
target customers
2. Competition To outperform them at all times.
To ensure corporate health and

3. Company profit

WHY STUDY MARKETING?
 To solve the declining numbers of
customers/clients.
 To determine competitors’ strengths and
weaknesses.
 To anticipate occurrence of problems of certain
phenomena.

WHY STUDY MARKETING?
 To identify possible target market and effective marketing
strategies.
 To easily penetrate in the market.
 To study the relevance and effectiveness of the 4P’s of marketing.

BASIC MARKETING TERMS
*EXCHANGE - it refers to the trade of things or

service of value between the buyer and seller.
*NEEDS – are the basic reason or minimum
requirement consumers look for in a product/service.

BASIC MARKETING TERMS
*WANT – are the determining dimensions
among many choices.
*FEATURES – are product attributes
offered by a company.

*ADVANTAGES - are what these features can do.
*BENEFITS – are advantages that meet the explicit needs and
wants of the customers.
*OBJECTIVE – the desired result of an activity.
*EXPECTATIONS – are values or intangibles associated
with a product or service.

THE WAY TO PROFIT
Select the target
market PROFIT
Determine what the

target market wants Implement marketing
strategy
Determine what
the firm can do
Formulate
marketing strategy
Determine what the
firm want
MARKETING PHILOSOPHY
• “ Better than Before”

• “ Better than Before “
• “ Better than Expected “

THE MARKETING VARIABLES
1. THE MARKETING MIX VARIABLES – this
consists of the 4 P’s of marketing such as the
product, the price, the promotion and the place.
a. Product – the tangible commodity or
intangible service that the business firm offers for
sale to prospective customers.

b. Price – the amount of money paid by

the customer to the selling firm so the
customer can use the product.
c. Promotion – the provision of required
information to prospective customers so
that they are persuaded to buy.

Types of Promotion:
1. Personal Selling – to get the
customer to buy.
2. Mass Selling – involves the
simultaneous persuading of large
numbers of prospects to buy the
company’s products.
When mass selling is in paid form, it is called
ADVERTISING; when in unpaid form, it is called PUBLICITY.
3. Sales Promotion – it is to convince the customers to buy
immediately such as coupons, raffle stubs, and free samples.

d. Place – this makes the company’s products available in the
location and time required by buyers.
2. THE MARKETING ENVIRONMENT VARIABLES
a. Social Forces – this includes: a) the characteristics of the
people, b) its income, c) its values.

b. Economic Forces – inflation and recession are two important
macro-economic conditions that marketers must consider in making
decisions.
c. Technological Forces – this refers to the development of existing
technology.

d. Competitive Forces – this consists of the basic forms of
competitions such as:
1. Pure competition – a market situation where there are
many competitors offering for sale identical products or services.

2. Monopolistic competition – exists when there are many
sellers in a particular market competing with each other. Ex:
bottled mineral water, bulbs, notebooks, toilet paper.

3. Oligopoly – a market situation where a few firms

compete in a given industry like gasoline, steel, automobiles,
cement, cigarettes.

4. Monopoly – exists when there is only a
single seller in a particular market.
e. Regulatory Forces – these refers to the laws
enacted by national government and local
ordinances by provincial and municipal
government that restrict business activities.

QUESTIONS FOR REVIEW AND
DISCUSSION
• 1. Do you consider marketing as an important human activity? Why or why not?
• 2. What happens when the business firm fails to sell its products?
• 3. What internal and external factors affect the marketing activities of the firm.
• 4. What does the firm do when it emphasizes “the place” in the marketing mix?

DISCUSSION
• 5. How does recession affect marketing?
• 6. How does inflation affect the marketing activities of the customer?
• 7. What internal and external factors affect the marketing activities of the firm.
• 8. Cite at least 10 business firms operating nationwide which employs advertising as a
means of transportation. Give ten products which does employ advertisement?

CHAPTER II – CONSUMER
BEHAVIOR

THE PURCHASE DECISION PROCESS
• 1. Problem recognition
• 2. Consumer information processing
• 3. Evaluation of alternatives
• 4. Purchase
• 5. Post-purchase evaluation

PROBLEM RECOGNITION
No one is immune from experiencing problems. Although some
persons are not aware of the existence of problems, some are wise
enough to recognize them. The object of marketing is to help people
provide solutions to their problems which, in marketing terms, simply
means satisfying needs. But before a need is satisfied, it must first be
identified.

CONSUMER INFORMATION PROCESSING
The consumer who is properly motivated attempts to
conduct an information search. These are two ways of
conducting information search: Internal and External.

CONSUMER INFORMATION PROCESSING
When the consumer scans his memory for experiences with products he thinks
will satisfy his need, it is referred to as Internal search. This is especially
applicable to low and frequently used items like toothpaste and toothbrushes.

THE EXTERNAL SEARCH – IS AN ATTEMPT TO GENERATE
INFORMATION OUTSIDE OF THE CONSUMER’S PERSONAL
EXPERIENCES. THIS IS USED FOR FF. REASON.
1. When the internal source of information is not enough.

2. When the risk of making the wrong decision is high; and
3. When the cost of gathering information is low.

THE EXTERNAL SOURCES OF INFORMATION
1. Friends and family CONSIST OF:
2. Salesman
3. Telemarketing
4. Trade shows
5. Advertising
6. In- store display
7. Sales promotion
8. Packaging
9. Magazines and news papers
EVALUATION OF
ALTERNATIVES
The objective of information search is to put up a list of alternatives
that the consumer thinks as worthy solutions to his problem. When the
list is ready, the alternatives indicated will be evaluated with the use of
a set of criteria like price, functions, quality, and the likes.

EVALUATION OF KARAOKE MACHINES
Brand Price Pitch Minus Recordin Sound
Control One g Quality
Quality Capabilit Capabilit
y y
A ‽10000 75% 75% 80% 80%
B ‽12000 n. a. 95% 95% 95%
C ‽9000 80% 85% 80% 80%
D ‽25000 95% 95% 95% 95%

PURCHASE
The consumer will have a tentative answer on “what to buy” but
he still have to find answers to the questions “where and when to buy”.
Because stores offer different incentives to costumers the purchase
decision will tend to be more complicated. For instance, one store may
provide a free annual maintenance service, while another store accepts
trade-in of used appliances.

PURCHASE
To further complicate decision making, some products come
cheap on certain season like construction materials during rainy days.
There are other factors that may hasten or delay a purchase decision. An
example s the sudden increase in the income of the consumer.

POST- PURCHASE
Whether
EVALUATION
or not the consumer will make a repeat purchase and endorse
the product to another will depend on how satisfied he is with the
product. This is of utmost importance to marketers and because this is so,
his immediate concern is to determine the consumer’s behaviour after a
purchase is made.

The consumer satisfaction level about the
purchase of product or service may be
classified into any of the ff.:
1. Highly satisfied;
2. Somewhat satisfied; and
3. Dissatisfied

FACTORS AFFECTING CONSUMER BEHAVIOUR:
1. Psychological variables
2. Social influences
3. The purchase situation

THE CONSUMER AND PSYCHOLOGICAL INFLUENCES
1. Motivation
Everyone, including the consumer, makes a purchase decision because he

is motivated to do so. The motivation to buy, however, happens as a result of
the “drive stimulus” which, in turn, is the result of an unsatisfied need.

Need is a thing or service that is required by a human being for his
health and well being. The need that moves a person to action is called
“ drive”.
2. Perception
People see, hear, taste, and fell differently. What may be
beautiful to one may not be so to another person.

A sound that may too loud to one may be just to another. As such,
products, advertisements ,packaging, and others are perceived
differently by different people.
An advertisement may not be appreciated by everybody
when confronted by it, but there will be some who will be
motivated to buy what is advertised.

THE PERSON IS REALLY AFFECTED BY THE SELECTIVE
PROCESS OF PERCEPTION CONSISTING OF THE FF.:
• SELECTIVE EXPOSURE – this happens when a person

pays attention only to message that are not against his
attitudes and beliefs.

CONSUMER’S BUYING BEHAVIOR
PSYCHOLOGICAL
VARIABLES SOCIAL INFLUENCES PURCHASE SITUATION
PERSONAL
MOTIVATION THE PURCHASE TASK
INFLUENCES
SOCIAL
PERCEPTION REFERENCE GROUPS
SURROUNDINGS
PHYSICAL
THE FAMILY
LEARNING SURROUNDINGS
ATTITUDES SOCIAL CLASS TEMPORAL EFFECTS
LIFESTYLE CULTURE ANTECEDENT STATES

UNSATISFIED NEED
DRIVE
MOTIVATION TO
BUY
DECISION TO BUY

• SELECTIVE ATTENTION – this occurs when the person who has selected
the information he wants to be exposed to, avoids contradictory.
• SELECTIVE COMPREHENSION – this means the person interprets selected
information to conform with his attitudes and beliefs.
• SELECTIVE RETENTION – this occurs when a person receives many kinds
of information but tend to remember only those that conforms with his
attitudes beliefs.

3. Learning
A change in behaviour occurring as a result of past experience
is called learning.
4. Attitudes
The buying behaviour of the consumers is also affected by his
attitude.

• LIFESTYLE
THE CONSUMERS PURCHASING DECISION IS ALSO
INFLUENCED BY HIS LIFESTYLE.
ATTITUDE
FAMILY LEARNNG PROCESS
PERSONALITY
PEER
GROUP EXPERIENCE
INFORMATION

SOCIAL INFLUENCES
1. Personal Influences
 Opinion leader
 Word of mouth
2. Reference Group
3. The Family
4. Social Class
5. Culture

THE PURCHASE SITUATION
• The purchase task
• The social surroundings
• The physical surroundings
• Temporal effects
• Antecedents States

THE PURCAHASE SITUATION
• Purchase Task – is derived from the reason why the consumer is making a
purchase and this affects buying behavior.
• Social Surroundings – refers to the situation of the people present in the
purchase area.
• Physical Surroundings – it also affects the purchase decision of the consumer.

THE PURCAHASE SITUATION
• Temporal effect – refers to the time of the day the purchase

is made and the time available for shopping.
• Antecedent states – like the consumer’s mood or the amount
of money he has in his pocket can affect his buying behavior.

Chapter III – The Buying Behavior of
Organizational markets

WHAT ARE ORGANIZATIONAL
MARKETS?
1. Industrial markets
2. Reseller markets
3. Government markets
4. Nonprofit organizations

ORGANIZATIONAL BUYING AND
IT'S CHARACTERISTICS
• Demand,
• Potential buyers
• Buying objectives
• Buying criteria
• Size of order or purchase
• Buyer –seller interaction
• The buying center
CRITERIA WHEN BUYING
PRODUCTS/SERVICES
• 1. Price
• 2. Ability of the seller to meet the quality
specifications required for the items.
• 3. Ability of the seller to meet required
delivery schedules
• 4. Technical capability of the seller
CRITERIA WHEN BUYING
PRODUCTS/SERVICES
• 5. Warranties and claim policies in the event
of poor performance.
• 6. Past performance of the seller on previous
contracts.
• 7. Production facilities and capacity of the
seller.
PURCHASE DECISION-MAKING
PROCESS IN ORGANIZATIONS
• Recognition of a problem or need;
• Search for information about products and
suppliers;
• Evaluation and selection of supplier;
• The purchase and;
• Performance evaluation and feedback.
RECOGNITION OF A PROBLEM
OR NEED
• Organizational purchasing is a result of product and
operational needs.
• An organization’s need can be identified by different
employees of the firm.
• Progressive firms are engaged in requirements planning.
• The firm needs to determine product specifications.

SEARCH FOR INFORMATION
ABOUT PRODUCTS AND
SUPPLIERS
• A listing of products or services that will solve the
problem.
• Make or buy analysis.
• Information must be gathered about potential

suppliers.

EVALUATION AND SELECTION
OF SUPPLIERS
The criteria used and the importance of each vary
according to the following:
1. the quality of goods or services being considered for

purchase;
2. the characteristics and needs of the buyer;

EVALUATION AND SELECTION
OF SUPPLIERS
3. the supplier’s ability to meet quality standards;
4. the supplier’s ability to meet delivery schedules;
5. the price; and
6. the technical capability of the supplier.

WHAT INFLUENCES
ORGANIZATIONAL
BUYERS
•Environmental factors
•Organizational factors
•Interpersonal factors
•Individual factors
INDUSTRIAL MARKETS
Organizations that require
goods and services for the
purpose of producing goods
and services.

Industrial markets
manufacturers
Farms, fisheries, forestry, mining

operations, construction firms
Financial institutions like banks, insurance,

real estate
Other service providers – transport, firms,

utilities, hotels, lawyers, doctors
RESELLER MARKETS
Organization that buy
goods and services which
they later sell at a profit.

Industrial markets Organizational markets
manufacturers
Reseller
Farms, fisheries, markets
forestry, mining
operations,
wholesaler
construction firms
Financial institutions
like banks, insurance,
real estate retailers
Other service
providers –
transport, firms,
utilities, hotels,
MRS. MARIBETH H. ANDINO MBM lawyers, doctors 10/18/2019 65
GOVERNMENT MARKETS
Government agencies that buy products
and services for use in the production of
public goods and services.

Industrial markets Resellers markets

Government market
manufacturers
wholesaler
Farms, fisheries, National
forestry, mining
operations,
construction firms retailers Local
real estate
Other service
providers –
transport, firms,
utilities, hotels,
lawyers, doctors
NONPROFIT
ORGANIZATIONS
Non - governmental organizations that
serve their customers but do not have
profits as organizational goal.

Nonprofit
Industrial markets Resellers markets Government market
organizations
manufacturers
wholesaler National
Farms, fisheries,
forestry, mining
operations, retailers Local
construction firms
real estate
National groups
like Boy Scouts, Local groups like
Other service
Red Cross, churches,
providers –
Knights of colleges, museums
transport, firms,
utilities, hotels, Columbus
lawyers, doctors
KINDS OF BUYING
PROCESSES
1. New-task buying
2. Straight rebuy
3. Modified rebuy
NEW-TASK BUYING
This happens when the organization has a new
need and the buyer wants a great deal of information.
This process takes more time and it involves the
following:
a. Setting product specifications;
b. Identifying sources of supply; and
c. Establishing an order routine for possible future
purposes.

STRAIGHT REBUY
This is a routine repeat purchase. This happens
when previous purchase is satisfactory. As such, the
buyer will need little information on new products
and new sources of supply.

MODIFIED REBUY
This process is undertaken when the items purchased
remain the same, but the members of the buying center are
not satisfied with the products quality, the price, or the
service provided by the supplier.

PARTICIPANTS IN ORGANIZATIONAL
BUYING PROCESS
* Users
* Influencers
* Deciders
* Approvers
* Buyers
* Gatekeepers
USERS
They are the ones who will use the product or
service that is the subject of the purchase.

INFLUENCERS
They are the persons who influence the buying
decision. Technical experts who give suggestions in terms
of specifications are examples of influencers.

DECIDERS
They are the persons who make decisions
on product requirements and suppliers.

APPROVERS
They are the persons who authorize
the proposed actions of deciders or
buyers.

BUYERS
They are the persons who are
authorized to select the supplier, and
arrange the terms of purchase.

GATEKEEPERS
They are the persons who have the power
to prevent sellers or information from
reaching members of the buying center.

ORGANIZATIONAL MARKETS
are those that buy goods
for production purposes or
for reselling.

DISCUSSION
• 1. In recognizing the organization’s problem, what factors must be considered?
• 2. In the search for information about products and services, what types of
information must be gathered about potential suppliers?
• 3. What steps are undertaken when evaluating the performance of the
product and the supplier?

CHAPTER IV – MARKET
SEGMENTATION AND TARGETING

WHAT IS MARKET?
• is a place where sellers and buyers exchange goods/services upon an

agreed price.
• as a group of people or organizations that buy a particular good,
service, or concept.

A market is composed of people with the needs to satisfy,
the money to spend, and the willingness to spend, and
the ability to satisfy the objectives of the seller.

TYPES OF MARKET
classified according to:
•type of institution
•Form
•Consumers
MARKETS ACCORDING TO TYPE OF INSTITUTION
Buyers who intend to directly consume a
product or service constitute the consumer market.
example: the real state market.

MARKETS ACCORDING TO TYPE OF INSTITUTION
• Organizational Markets
Constitutes buyers of products or services whose intention is to produce another
product or service.
• International Markets
Refers to all types of buyers found abroad including consumer and organizations.

MARKETS ACCORDING TO FORM
• Primary Markets
This type of market that is formed when a firm introduces a new product class in
response to latent demand or needs
• Secondary Markets
This type is an offshoot of the primary market and it is formed when customers
develop specific needs or preferences.

MARKET SEGMENTATION
•A market segment is a sub-group of a particular market which is
composed of units with more or less similar characteristics.
• Market segmentations may be defined as the process of identifying the

various segments of a company's particular market.

THE MARKET FOR BOOKS
SEGMENTS General
Teachers Students
Public
SUB-
SEGMENTS Elementary High School College

THE ADVANTAGES OF MARKET SEGMENTATION
1. Segmentation forces the marketer to be aware of realities in

the market.
2. Segmentation provides clues in the design of products and

marketing programs that will reach the prospective customers.

THE ADVANTAGES OF MARKET SEGMENTATION
3. Segmentation can help identify opportunities for new product

development.
4. Segmentation can help improve the strategic allocation of marketing

resources.

SEGMENTATION STRATEGIES
• Concentration or single-segment strategy refers to that long-term decision
of the company to deal only with a particular segment of the market.
• The multi-segment strategy calls for providing products or services to two or
more segments of the target market.

BASES FOR MARKET SEGMENTATION
• Geographic Segmentation
requires dividing the market into different
geographical units like nations, regions, provinces, cities,
towns, or barangay.

BASES FOR MARKET SEGMENTATION
 Demographic Segmentation
refers to dividing the market into segments on the basis of demographic variables
like age, sex, family, size, family life cycle, income, occupation, education, religion, race,
and nationality.

Bases for Segmentation
Geographic Demographic Behavioral Psychographic
•Nations •Age •Social class •Purchase occasion

•Sex •Benefits sought
•Regions •Family size •Life cycle •User status
•Family life •Usage rate
•Provinces cycle •Loyalty status
•income •Readiness stage
• Cities •Occupation •Attitude toward
•Education product
•Towns •Religion
•Race
•Barangays •Nationality

• Bases for Market Segmentation
• Psychographic Segmentation
• Refers to the classification of buyers and consumers by some psychological
characteristics they posses in common. They may be grouped according to social
class or lifestyle.
•

BUYER BEHAVIOR MAY BE SEGMENTED
ACCORDING TO VARIOUS CATEGORIES NAMELY:
1.PURCHASE OCCASION
2.BENEFIT SOUGHT
3.USER STATUS
4.USAGE RATE
5.LOYALTY STATUS
6.READINESS STAGE
7.ATTITUDE TOWARD PRODUCT

ACCORDING TO VARIOUS CATEGORIES
NAMELY:
• Purchase Occasion – it arise on the basis of time or event like school opening etc.
• Benefit sought – this is what the customer gain from the product or do something good
about them.
• User status – it can be classifies as non-users, ex-users, potential users, first-time users, and
regular users.

ACCORDING TO VARIOUS
CATEGORIES NAMELY:
• Usage rate – it classified buyers into light users, medium users and heavy
users.

•Buyers may also grouped according to their loyalty to particular
brands. They may be classified as follows:
1.Those who buy only one brand of a product

2.Those who buy two or three brands
3.Those who shift from one brand to another
4.Those who have no brand preference.

Another way of segmenting the market is to classify
buyers according to their readiness to buy. In this regard,
they may be categorized into the following stages:
1.People who are unaware of the product.
2.People who are aware of the product

3. People who are informed of the product
4. People who are interested in the product
5. People who desires the product
6. People who want to buy the product

•People’s attitude toward the product may also be classified according to
their degree of enthusiasm. These are the following:
1. People who have an enthusiastic attitude toward the product

2. People who have a positive attitude toward the product

3. People who have an indifferent attitude toward the
product
4. People who have a negative attitude toward the
product
5. People who have a hostile attitude toward the
product.

SELECTING TARGET
MARKETS
• The selection of targets is a marketing activity that should be
planned carefully. The consequence of picking the wrong
segments may lead to lost opportunities and waste of company
resources.

To determine which segments are right for the firm,
the following criteria must be considered:
1.Size
in choosing a market segment, it must e large enough to
be worth serving. Size, however, does not necessarily
refer to the number of potential buyers but the volume
of sales that may be generated.

2. Expected Growth
there are markets that are not currently attractive but
some of these may be expected to grow in the future.
3. Competitive Position
the presence of competition in the segment
considered lowers the firm’s chance of successfully
making profits.

4.Cost of reaching the segment
a market segment that is chosen must be easily reached by
the firm. If marketing effort to reach it will be too expensive,
it may jeopardize profits, and in that case, it not be chosen.
5. Compatibility with the firm’s objectives and resources
if the firms does not have enough resources to serve a
prospective segment, the segment must not be selected.

DISCUSSION
• 1. Identify (2) two company and propose a market segmentation
category which you consider to be suitable to the company.
• 2. Cut (10) ten newspaper clippings and make a review. Identify
what segment each advertisement is targeting.
• 3. Is market segmentation always beneficial to the firm? What
advantages may segmentation offer?

Chapter V – Marketing Research and
Information Systems

WHAT IS MARKETING INFORMATION SYSTEM?
• Marketing Information System (MKIS) – is a structure consisting

of people equipment, and procedures to continually gather
and analyze data to provide marketing managers with
information they need to make decisions.

WHAT IS MARKETING RESEARCH AND
INFORMATION SYSTEM
The task of the MKIS consists of the
following:
1. To define the information requirements
of the marketer;
2. To develop the needed information; and
3. To distribute the information at the time
they are needed.
THE CONCEPT OF THE MARKETING
INFORMATION SYSTEM

Defining 1. Marketing planning
Information involving 2. Marketing execution
Needs 3. Marketing control
1. Internal records
Developing 2. Marketing intelligence
Information through
3. Marketing research
4. Information analysis
Decision-makers
Distributing
in marketing
Information
to
Internal Records compromise the
following:
1. Accounting records
2. Manufacturing records
3. Sales and department records
4. Customer service department records
5. Information gathered by other
departments

When scanning the environment,
managers any of the following ways:
1. Undirected viewing
2. Conditioned viewing
3. Informal search
4. Formal search

Decision-Maker Decision-Maker Decision-Maker Decision-Maker
Request Needs No query

Requests
Certain Is made
Right Wrong
Info. Because of
Info. Info. Ignorance
For right But no For right About the
problem Request Is problem Existence
forwarded Of needed
Establish Info.
Deliver
Confidence
Right And design Educate/
Info. Orient
Simpler Assist in About
Means of Identifying The
Receiving Needed Benefits
queries Info.
Derived
From MKIS
MRS. MARIBETH H. ANDINO MBM
Marketing Information System 10/18/2019 119
MARKETING INTELLIGENCE
-This refers to the gathering of everyday information
about developments in the marketing environment.
1. Undirected viewing
2. Conditioned viewing
3. Informal search
4. Formal search
MARKETING RESEARCH
-It is defined as the systematic gathering, recording and analyzing of
data about problems relating to marketing o goods and services.
Marketing research serves to provide answers to many questions
including those on:
1.Market potentials
2.Market share
10/18/2019 121
MARKETING RESEARCH
3. Market characteristics
4. sales
5. Business trend
6. Short-range forecast
7. Long-range forecast

8. Existing products 10/18/2019 122
MARKETING RESEARCH PROCESS
. Definition of the problem
1
2. Situation analysis
3. Obtaining primary data
4. Interpretation of data
5. Problem solution
DISCUSSION
• 1. How marketing research helps marketing personnel make sound

strategic decisions?
• 2. What are the problems confronted by the marketing staff in
advertising a product or service?
• 3. What advantages does the marketing research brought to the firm?
• 4. How is primary data obtained?
DISCUSSION
• 5. As the marketing research industry expands into the next century, what
skills will future executives need to possess? How do these skills differ from
those currently needed to function successfully in the marketing research
field?

DISCUSSION
• 6. You have been hired by Mc Donald’s to lead a mystery

shopper team. The goal of your research is to improve the
service quality at the Mc Donald’s restaurant in your area.
What attributes of service quality will you attempt to measure?
What customer or employee behaviors will you closely monitor?

• Products are the Vehicles by which the company attempts to accomplish
its objectives.
• The only element in the marketing that the company cannot do without.
• It is anything offered for a sale by a firm to buyers to satisfy their
wants and needs.

• A Physical object like a toy or a kilo of pork;
• A Service like a Ferris wheel ride or a dental check-up;
• A Place like London , Singapore ,Boracay, and Palawan

• An Organization like Knights of Columbus or the Philippine
Marketing Association
• An Idea like “Pro-life” or “Preservation of Ozone layer
• A Personality like Evita Peron or Efren “Bata” Reyes

1. Quality
2. Reputation of the manufacturer
3. Packaging
4. Credit
5. Information about the product
6. Warranty
7. After sales service
8. Delivery
•A product is anything offered for sale by a firm to buyers to
satisfy Physical, Social, Symbolic, and Psychological wants
and needs.

A. Consumer Goods
B. Industrial Goods

- are those intended for final consumption by
consumers.

1. Rate of Consumption and Tangibility
- based on rate of consumption and tangibility.
2. Consumer’s Shopping Habits
- based on consumer’s shopping Habits.

a. Durable goods
- tangible goods which normally survive with many uses (ref, TV)
b. Nondurable goods
- tangible products which are consumed one or few uses (ice cream, cd, petrol)
c. Services
- intangible goods like activities, benefits, or satisfaction which are offered for sale.

a. Convenience goods
- purchase with a minimum of effort.
b. Shopping goods
- bought only after an effort to compare with other
goods are made (shoes, CP)
c. Specialty goods
- are those that the consumers seek to buy and they
are not willing or they are not able to accept
substitute.
d. Unsought goods
- are those that are not yet wanted by or are still unknown
to consumer. Consumers use no effort to seek them.

(1) New Unsought goods – really new ideas or products that the consumer still
have to know to be motivated to buy. Ex. is Papaya soap when it was first
introduced
(2) Regular Unsought goods – are stay unsought but not unbought forever. Ex.
Encyclopedia, life insurance & memorial educational plan

- are those used in the production of other goods.

a. Installation
- refers to industrial products with long
life, are generally expensive, and they
form part of the major capital equipment
of an industrial firm.
b. Accessory Equipment
- industrial goods that are as aids in the
production process, have shorter life.
INDUSTRIAL GOODS CATEGORY
c. Components parts and Materials
- processed industrial products that will be used and become an
actual part of the finished product. (1) Component Material
(printed magazines, flour into bread, textile into dresses and (2)
Component Parts (tires in cars, string in violin, knobs on TV)

d. Raw Materials
- these are unprocessed goods that will become part of another
product. (1) Farm products are those grown by farmers like
palay, tomato, eggplant, coconut (2) Natural products are those
which occur by nature like fish, gold, diamond, lumber.

e. Supplies
- used as aids in the operating process but do not become part
of finished products like pencil, ink, fastener etc.
f. Services
- these are expenses items that assist in the operations like
security, consultancy .

1. Branding
2. Quality
3. Image
4. Product features
5. Packaging
6. Location
7. Promotion
8. Innovation
9. Different service levels
-It is a marketing action which identifies and helps
differentiate the goods or services of one seller from
those of another. A consumer who uses a product and
begins to like it, will find less difficulty in purchasing
the product and again if he is provided with a brand
to remember.

-Is a name, term, sign, symbol, or design, or a
combination of these elements, that is intended to identify
the goods or services of one seller or group of sellers.
-Maybe Legally registered (with legal protection
“trademark”) or Not Legally registered.

a. Brand Name
- refers to that part of a brand that appear in the form of words,
letters, and/or numbers that can be vocalized.(UST, Tide)
b. Brand Mark
- refers to the part of a brand that appears in the form of symbol,
design, or distinctive coloring or lettering and which can’t be vocalized.

- it is where the firm which owns or controls a brand
allows another firm to use the brand in exchange for
royalties or some other form of payment.

1. It should suggest something about the product’s benefits and
qualities like Close Up, Great taste, Color Roof.
2. It should be easy to pronounce, recognize, spell and
remember (Ligo, Milo, X.O, Pop, Coke.

3. It should be distinctive like Minola, Condura, Cortal, Levis, Bioflu.
4. It must be adaptable to additional product lines like Honda,
Hitachi, LG.
5. It must be capable of being legally registered. Café Mate to
Coffee Mate

1.Manufacturer Branding
2.Reseller Branding
3.Mixed Branding
4.Generic Branding
-a branding strategy in which the brand name for a product
is designated by the manufacturer.
1. Multiproduct approach – referred to as blanket or family
branding strategy, uses the same brand name to cover a group
of products
2. Multi-brand approach – requires the firm to provide each
product with a distinctive name.
-referred to as private labeling or private
branding, a strategy of a firm which manufactures
products but sell them under the brand name of a
reseller.

- refers to the use of the manufacturer and reseller
brands in a product. It is expected that market segments
attracted to the manufacturer and to the reseller will
patronize the mixed branded product.

- a strategy which lists no product name, only a
description of contents. This approach is applicable to
rice, salt, sugar, and charcoal.

PACKAGING
• Packaging refers to all activities involved in designing and

producing the container or wrapper for a product. The container
or wrapper is the Package.
Three levels of materials of Packaging:
1. The primary package – the product’s immediate container.

PACKAGING
Three levels of materials of Packaging:

2. The secondary package – protects the primary package like the
carton box containing 2 dozen of Carnation Milk can
3. Shipping package – contains the secondary packager. It provides
ease of storage, identification and shipping.

REASONS FOR PACKAGING
1. It provides protection to products.

2. It provides convenience to the user.
3. It provides safety.
4. It provides economy to both the seller and the user.
5. It allow seller to effectively promote the product.
LABELING
- the part of the product which provide information about the
product and the manufacturer.
Types of labels
1. Brand label
2. Descriptive label
3. Grade label
4. Promotional label

TYPES OF LABELS
• 1. Brand label – identifies the product or brand. Ex. Goodyear,

Ipanema, Rado
• 2. Descriptive label – provides information about the product:
who made it, where, and when it was made, its content, how it is
used and how safe it is.
TYPES OF LABELS
• 3. Grade label – identifies the product’s judged quality with
a letter, number, or word like “Grade A”, “Grade 3”, or
“Premium Grade”
• 4. Promotional label – provides attractive graphics to help
promote the product.

PRODUCT WARRANTY
- the statement which explains what the seller promises
about the product. It is actually a manufacturer’s written
promise as to the extent of repair, replacement, or
otherwise compensation for defective goods.

2 types of Warranty
Express warranties – are written statements of a
manufacturer’s liabilities for product deficiencies.
Implied warranties - are those that assign
responsibility for product deficiencies to a
manufacturer even if the item was sold by a retailer.

PRODUCT LIFE CYCLE
- Refers to the product’s sales growth from the beginning to its peak, followed
by a decline and its eventual withdrawal from the market.
1. Introduction
2. Growth
3. Maturity
4. decline
PRODUCT LIFE CYCLE
Introduction Stage - the product is introduced to the public.
It was characterized by:
*Slow growth sales
*Heavy promotional expenditures
*High prices for the product
*Limited product offerings like variations in size, color & style.

Growth Stage - it follows after successful introductory stage. It was
characterized by:
*Sales start climbing rapidly
*Promotional expenditures decreases
*Prices tend to remain high
*New forms of the product appear like new color, new models, new
sizes.

Maturity Stage - it begins to take over when the growth
in sales slows down.
*Competition is intensified.
*The market becomes saturated.
*Sales settle down as the product becomes well-
known.
*Price reductions are used as a tool of competition

Decline Stage - begins with a permanent drop in sales.
*Promotional expenses are reduced.
*Plans for phasing out the product is made.
*Trim of product models

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PRINCIPLES OF MARKETING

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1. Customers To competently satisfy the

2. Competition To outperform them at all times.

To ensure corporate health and

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*EXCHANGE - it refers to the trade of things or

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Determine what the

• “ Better than Before”

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b. Price – the amount of money paid by

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3. Oligopoly – a market situation where a few firms

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1. When the internal source of information is not enough.

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B ‽12000 n. a. 95% 95% 95%

C ‽9000 80% 85% 80% 80%

D ‽25000 95% 95% 95% 95%

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Everyone, including the consumer, makes a purchase decision because he

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• SELECTIVE EXPOSURE – this happens when a person

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ATTITUDES SOCIAL CLASS TEMPORAL EFFECTS

LIFESTYLE CULTURE ANTECEDENT STATES

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