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Chapter 1: An Overview of Marketing
1
Review Queson
1. Give an example of a company that is successfully following a production orientation.
Why does following a production orientation make a firm in this industry successful?
A mature product, such as a small no-frills calculator, is sold basically on price. A
Applicaon Quesons
1. Your company president has decided to restructure the firm to make it more market
oriented. She is going to announce the changes at an upcoming meeting. She has
asked you to prepare a short speech outlining the general reasons for the new
company orientation.
Students’ answers should focus on (1) customers’ wants and needs, (2) distinguishing the
company’s products and services from competitors’ offerings, and (3) the integration of all
2. Donald E. Petersen, chairman of the board of Ford Motor Company, remarked, “If we
aren’t customer driven, our cars won’t be either.” Explain how this statement reflects
the marketing concept.
Although students’ answers will vary, they should address some of these points. The
marketing concept focuses on satisfying customers’ needs while meeting organizational
3. A friend of yours agrees with the adage “People don’t know what they want—they only
want what they know.” Write your friend a letter expressing the extent to which you
think marketers shape consumer wants.
Although students’ answers will vary, but they should explain that marketers cannot create
demand or make people buy things that they don’t want or need. Marketing does, however,
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Chapter 1: An Overview of Marketing
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4. Your local supermarket uses the slogan “It’s your store.” However, when you asked one
of the stock people to help you find a bag of chips, he told you it was not his job and
that you should look a little harder. On your way out, you noticed a sign with an
address for complaints. Draft a letter explaining why the supermarket’s slogan will
never be credible unless its employees carry it out.
Students’ answers will vary widely, but they should explain that the marketing orientation,
5. How does Philip Morris handle the sensitive issues associated with marketing tobacco?
What kind of information does its website at http://www.philipmorris.com/ provide
about smoking and its negative effects on health? How do you think Philip Morris is
able to justify such marketing tactics? After browsing the site, do you think that
approach makes the company more or less trustworthy?
6. Write a letter to a friend or family member explaining why you think that a course in
marketing will help you in your career in a field other than marketing.
Students’ answers will vary, but they should include a discussion of the importance of
Applicaon Exercise
Understanding the differences among the various marketing management philosophies is the
Activities
1. Visit your local grocery store and go through the cereal, snack food, and dental hygiene
© 2018 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Chapter 1: An Overview of Marketing
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2. Count the varieties of product in each product category. For example, how many different
3. Now, try to find a type of product in the grocery store that does not exhibit such variety.
There may not be many. Why do you think there are enough kinds of cereals to fill an
4. Have you ever wanted to see a particular kind of cereal or snack food on the shelf? Think
of product varietals (like grapefruit-flavored toothpaste or peanut butter-covered popcorn)
Purpose: The purpose of this application is to introduce the students to the marketing concept.
Setting It Up: You may want to assign this to pairs of students. That way they can discuss their
Deanna R. D. Mader, Marshall University
Fred H. Mader, Marshall University
GIVE THEM WHAT WE MAKE, OR GIVE THEM WHAT THEY WANT?
The following simple in-class exercise can be used either to illustrate the differences between the
Task: Divide the class into four groups. Have the groups separate as much as classroom space
will allow to minimize interference. Tell two of the groups that they are the “producers” and that
© 2018 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Chapter 1: An Overview of Marketing
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their job is to make a product for the other groups. Tell the remaining two groups that they are
Outcomes: Invariably, the “producers” do not produce what the “consumers” had in mind.
Products and concepts may come close, but they are never identical. Class discussion is typically
Ethics Exercise
In today’s business environment, ethics are extremely important. In recent years, there have been
numerous scandals and trials that stem from a lack of ethical judgment. For this reason, we are
including an ethical exercise in every chapter. A brief scenario will present you with a situation
in which the right thing to do may or may not be crystal clear, and you will need to decide the
ethical way out of the dilemma. To help you with these decisions, we will give you reference to
the AMA’s Statement of Ethics, found online at http://www.marketingpower.com. This will give
you a resource for the exercise and will also help reinforce the ethical standards that marketers
should uphold.
Rani Pharmaceuticals is the maker of several popular drugs that are used to treat high blood
pressure and arthritis. Over time, the company has developed a positive relationship with many
of the patients who use its medications through a quarterly newsletter that offers all the latest
information on new medical research findings and general health and fitness articles. The
company has just been acquired by a group of investors who also own Soothing Waters Hot Tubs
and Spas. The marketing director for Soothing Waters would like to use Rani Pharmaceuticals’
mailing list for a direct-mail promotion.
Questions
1. What should Rani Pharmaceuticals do?
In order to avoid the semblance of impropriety, it might be better for the marketing director
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Chapter 1: An Overview of Marketing
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2. Do you think it is ethical to use customer information across multiple divisions of the
same company? Explain.
This is a situation to be handled with caution. Rani Pharmaceuticals should not simply
hand over customer information. Although it is not unethical per se for a company to
3. To which marketing management philosophy do you think the marketing director for
Soothing Waters subscribes? Explain.
The marketing director for Soothing Waters seems to be taking a sales-oriented marketing
4. Does the AMA Statement of Ethics address using customer information by multiple
divisions of the same company in its Statement of Ethics? Go to
http://www.marketingpower.com, and review the code. Then write a brief paragraph
on how the AMA Code of Ethics relates to Rani Pharmaceuticals’ dilemma.
The AMA Code of Ethics does not provide specific guidelines for the use of information
across an organization. In fact, the lack of principles relative to information collection,
Video Assignment: Georey B. Small
Geoffrey B. Small is a super luxury fashion designer with an eye toward social justice and
connecting with his buyers. In this video, Small discusses how he began designing clothes and
deciding whom to design clothes for and how to connect with his customers. He also discusses
the nature of consumer behavior. He also mentions his beliefs in terms of how consumers
© 2018 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Chapter 1: An Overview of Marketing
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purchase fashion and how this affects clothing prices.
1. Geoffrey B. Small takes great pride in offering a high level of handwork in his clothing
because:
a. it offers higher customer value.
b. it is part of his marketing orientation.
c. it is how he markets his clothing.
d. he can employ more people that way.
2. Geoffrey B. Small believes that one function of advertising is to make the customer believe
what companies say. Therefore, he doesn’t advertise and lets the clothes speak for
themselves.
a. True
b. False
3. How would Geoffrey B. Small answer the question “what is this firm’s business?”
a. Making clothes for environmentally aware customers
b. Offering a great product and great service by honestly communicating with the
customer
c. Showing people how clothes should be made locally
d. Giving the customer something they need badly enough that they will pay for it
4. To which marketing management philosophy does Geoffrey B. Small subscribe?
a. Production orientation
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Chapter 1: An Overview of Marketing
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b. Marketing orientation
c. Sales orientation
d. Societal marketing orientation
5. When Small describes how his customers choose to purchase his clothes (by evaluating
that his brand is environmentally conscientious, whereas most other brands are not), which
condition of exchange is being met?
a. Each party has something of value to the other party.
b. Each party is capable of communication and delivery.
c. Each party is free to accept or reject the exchange offer.
d. Each party believes it is appropriate or desirable to deal with the other party.
6. When Small discusses how customers crave personal interaction, crave knowledge of the
person who created the garment, and want unique humanness in their clothing, what is he
describing?
a. Avoiding unrealistic pricing
b. Having a strong sales team
c. Building relationships
d. Building trust
7. Which aspect of customer value is Small discussing when he refers to cost cutting, dividing
the cost of a garment over the years it is worn, and the money invested in the company?
a. Avoiding unrealistic pricing
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Chapter 1: An Overview of Marketing
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b. Empowering customers
c. Using the marketing concept
d. Increasing customer satisfaction
8. Small’s focus on the longevity of his garments suggests that he is:
a. empowering his customers.
b. decreasing customer satisfaction.
c. offering products that perform.
d. harming his business model.
9. By providing the customer a top-quality product that lasts for 25 years, Geoffrey B. Small
is:
a. placing a premium on making a sale.
b. providing customer satisfaction.
c. using the marketing concept.
d. developing a deeper understanding of his customers.
10. Small’s refusal to give in to the pressure to make more, to change his methods, or to lower
prices, in order to keep using local products and maintain a high level of quality, indicates:
a. a shift to a production orientation.
b. a shift in the firm’s primary goal.
c. a refusal to use the tools at his disposal.
d. his commitment to the societal marketing orientation.
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Chapter 1: An Overview of Marketing
9
Case Assignment: The Coca-Cola Company
They have over one million likes on Facebook, over 800,000 followers on Twitter, over
8,000,000 views on YouTube, and over 20,000 followers on Instagram. Ninety-four percent of
The Coca-Cola Company has been in business for over 130 years. Established in 1886 in
“The Coca-Cola Company is steeped in history and tradition, where heritage is honored
and values are respected. We are a global family of people working together to bring your family
With that in mind, the Coca-Cola Company adopted a strict marketing policy in
The Responsible Marketing Policy, which is available on the company’s website, states
The policy also states that no marketing communications will be designed to directly
© 2018 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Chapter 1: An Overview of Marketing
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Finally, in a full commitment not to advertise to children under 12, the policy says, “As a
The Responsible Marketing Policy was adopted amid growing complaints that Coca-Cola
was partly to blame for the rise in childhood obesity in United States.
TRUE/FALSE
1. The desired outcome of Coca-Cola’s advertising is for people to exchange money for their
product.
PTS: 1 OBJ: LO: 1-1 TOP: AACSB: Reflective Thinking
KEY: CB&E Model: Strategy MSC: BLOOMS: Level I Knowledge
2. The Coca-Cola Company’s decision to adopt a Responsible Marketing Policy indicates that
they will move forward in advertising with a societal marketing orientation.
PTS: 1 OBJ: LO: 1-2 TOP: AACSB: Reflective Thinking
© 2018 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Chapter 1: An Overview of Marketing
11
KEY: CB&E Model: Strategy MSC: BLOOMS: Level I Knowledge
3. There are no major differences between sales and market orientations.
PTS: 1 OBJ: LO: 1-3 TOP: AACSB: Reflective Thinking
KEY: CB&E Model: Strategy MSC: BLOOMS: Level I Knowledge
4. The types of advertisements a company chooses to create are very important because
marketing plays a very large role in society.
PTS: 1 OBJ: LO: 1-4 TOP: AACSB: Reflective Thinking
KEY: CB&E Model: Strategy MSC: BLOOMS: Level I Knowledge
5. Since Coca-Cola is sold at a low cost, it provides high customer value.
PTS: 1 OBJ: LO: 1-3 TOP: AACSB: Reflective Thinking
KEY: CB&E Model: Strategy MSC: BLOOMS: Level I Knowledge
© 2018 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
