Principles of Marketing


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Economics is greatly impacted by how well information travels through society. Today, social media giants Twitter, Facebook, and Instagram are major forces on the information super highway. (Credit: Johan Larsson/Flickr)

Decisions ... decisions in the social media age

To post or not to post? Every day we are faced with a myriad of decisions, from what to have for breakfast, to which route to take to class, to the more complex—“Should I double major and add possibly another semester of study to my education?” Our response to these choices depends on the information we have available at any given moment; information economists call “imperfect” because we rarely have all the data we need to make perfect decisions. Despite the lack of perfect information, we still make hundreds of decisions a day.

And now, we have another avenue in which to gather information—social media. Outlets like Facebook and Twitter are altering the process by which we make choices, how we spend our time, which movies we see, which products we buy, and more. How many of you chose a university without checking out its Facebook page or Twitter stream first for information and feedback?

As you will see in this course, what happens in economics is affected by how well and how fast information is disseminated through a society, such as how quickly information travels through Facebook. “Economists love nothing better than when deep and liquid markets operate under conditions of perfect information,” says Jessica Irvine, National Economics Editor for News Corp Australia.

This leads us to the topic of this chapter, an introduction to the world of making decisions, processing information, and understanding behavior in markets —the world of economics. Each chapter in this book will start with a discussion about current (or sometimes past) events and revisit it at chapter’s end—to “bring home” the concepts in play.


In this chapter, you will learn about:

  • What Is Economics, and Why Is It Important?
  • Microeconomics and Macroeconomics
  • How Economists Use Theories and Models to Understand Economic Issues
  • How Economies Can Be Organized: An Overview of Economic Systems

What is economics and why should you spend your time learning it? After all, there are other disciplines you could be studying, and other ways you could be spending your time. As the Bring it Home feature just mentioned, making choices is at the heart of what economists study, and your decision to take this course is as much as economic decision as anything else.

Economics is probably not what you think. It is not primarily about money or finance. It is not primarily about business. It is not mathematics. What is it then? It is both a subject area and a way of viewing the world.

In this course, you will learn about the marketing process and examine the range of marketing decisions that an organization must make in order to sell its products and services. You will also learn how to think like a marketer, discovering that the focus of marketing has always been on the consumer. You will begin to ask, "Who is the consumer of goods and services?" What does the consumer need? What does the consumer want? Marketing is an understanding of how to communicate with the consumer, and is characterized by four activities:

* Creating products and services that serve consumers

* Communicating a clear value proposition

* Delivering products and services in a way that optimizes value

* Exchanging, or trading, value for those offerings

Quiz PDF eBook: 
Principles of Marketing
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112 Pages
English US
Educational Materials

Sample Questions from the Principles of Marketing Quiz

Question: In a marketing campaign, who might be considered part of the campaign's audience?


Anyone directly or indirectly affected by the campaign's efforts

Everyone except for internal shareholders and stakeholders

Clients, customers, global target markets

Both A and C

Question: Targeted marketing may also be considered as _______.


differentiated marketing

undifferentiated marketing

shotgun marketing

wide blasts of media messages

Question: Strategic planning is focused on which organization marketing components?


Mission statements, objectives, value propositions

Budgets, taxation, distribution costs

Recruitment, hiring, training

Formation, deformation, reformation

Question: By definition, A SWOT analysis examines which aspects of the marketplace?


Support and wages

Organizations and technologies

Both A and B

Neither A nor B

Question: At what level in a firm does strategy planning typically occur?


Entry-level marketing employees are responsible for strategic plan development.

Top executives and special business units typically develop strategic plans.

Customers determine the strategic plan a company should follow.

Interns develop strategic plans as part of their initial duties.

Question: Psychographic segmentation deals with which customer characteristics?


Neuroses, psychoses, dysfunctions

Addictions, avoidances, antagonisms

Values, attitudes, lifestyles

Age, gender, income

Question: What are some common ways of segmenting target buyers?


Behavioral and psychographic segmentations

Demographic and geographic segmentations

Both A and B

Neither A nor B

Question: If you are marketing to Business-to-Business sellers, what should you consider?


The segmentation of B2B sellers is not at all similar to consumer market segmenting.

B2B sellers are also segmented along lines of demographics and geographic areas.

Both A and B

Neither A nor B

Question: What kinds of information would be considered in demographic segmentation?


Location, longevity, language

Age, income, gender

Intelligence, maturity, stability

Nationality, social class, job title

Question: Does a customer's ethnicity impact buying decisions?


Ethnicity has a large impact on purchasing decisions.

Ethnicity has a minor impact on purchasing decisions.

Ethnicity has no impact on purchasing decisions.

Customer diversity is a social rather than a marketing concern.

Question: What are the common characteristics of a family life cycle?


The ups and downs a family faces over the course of a single year

A family's transportation preferences

The age range of a family

The stages a family goes through over time and the effects of these stages on their buying behavior

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Source:  Dionne Mahaffey, Tamara Gillis, and Steven Van Hook. (The Saylor Academy 2014),
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