Here's one of my favorite sayings in marketing,
people don't buy quarter inch drills,
they buy quarter inch holes.
And here's another one. In the factory we make cosmetics,
in the drugstore we sell hope.
For both of these quotations the underlying idea is that,
the goal of marketing is to first identify and then satisfy consumer needs and wants.
And that's where the study of consumer behavior in micro-economics can be so valuable.
This chart here provides you with an overview of some of
the big questions and key concepts of strategic marketing management.
To identify consumer needs and wants,
marketers use statistical tools like market research and market intelligence to
identify customer value and
satisfaction and identify the decision making units in a market.
From there, marketing strategy focuses on how to target and segment a market and
then position a product or service to build
a sustainable competitive advantage using tools like perceptual maps.
And from that marketing strategy,
you then move to designing your marketing program.
Here, strategic marketers use statistical tools like conjoint analysis and
strategic concepts like product life cycle analysis
to determine parameters like the promotion mix,
distribution channels and of course, appropriate pricing strategies.
My broader point here is simply that if you want to be successful in business,
either as a marketing executive or strategist or perhaps as the CEO of your own company,
all of the various disciplines in a business education are useful in
some way either directly or indirectly across all areas of the firm.
And micro-economics provides a particularly important set
of tools and insights in the marketing dimension.
In the next lesson we will turn from the mysteries of
demand curves to a similar investigation of the supply curve.
And more broadly what we call in micro-economics, production theory.
In fact, production theory has much to teach us about
another key area of business known as operations and supply chain management.
So take a well deserved break now, you've earned it.
And when you are refreshed and relaxed please move on to lesson four.
From the University of California Irvine, I'm Peter Navarro.
