Principles of Marketing

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Philip Kotier

G a ry Arm strong

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Marketing Creating and Capturing

Customer Value

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steps, companies work to understand consumers, create customer value, and build strong

customer relationships. In the final step, companies reap the rewards of creating superior

customer value. By creating value for consumers, they in turn capture value from consumers

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# FIGURE | 1.1 A Simple Model of the Marketing Process

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P R I N C I P L E S OF

Marketing

Global Edition

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Global Edition

PHILIP KOTLER

Northwestern University

GARY ARMSTRONG

University of North Carolina

PEARSON

Upper Saddle River Boston Columbus San Francisco New York

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Dedication

To Kathy, Betty, Mandy, M att, KC, Keri, Delaney, Molly, Macy, and Ben;

and Nancy, Amy, Melissa, and Jessica

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About the Authors

As a team, Philip Kotler and Gary Armstrong provide a blend of skills uniquely suited to writing an

introductory marketing text. Professor Kotler is one of the world's leading authorities on marketing

Professor Armstrong is an award-winning teacher of undergraduate business students. Together they

make the complex world of marketing practical, approachable, and enjoyable.

Philip

Kotler is the S. C. Johnson & Son Distinguished Professor of International Marketing at the

Kellogg School of Management, Northwestern University. He received his m aster's

degree at the University of Chicago and his PhD at MIT, both in economics. Dr. Kotler is the

author of Marketing Management (Pearson Prentice Hall), now in its thirteenth edition and the most

widely used marketing text book in graduate business schools worldwide. He has authored

dozens of other successful books and has written more than 100 articles in leading journals. He is

the only three-time winner of the coveted Alpha Kappa Psi award for the best annual article in

the Journal o f Marketing.

Professor Kotler was named the first recipient of two major awards: the Distinguished

Marketing Educator o f the Year Award, given by the American Marketing Association and the Philip

Kotler Award for Excellence in Health Care Marketing, presented by the Academy for Health Care

Services Marketing. His numerous other major honors include the Sales and Marketing

Executives International M arketing Educator o f the Year Award; the European Association of

Marketing Consultants and Trainers M arketing Excellence Award; the Charles Coolidge Parlin

Marketing Research Award; and the Paul D. Converse Award, given by the American Marketing

Association to honor “outstanding contributions to science in marketing." In a recent Financial

Times poll of 1,000 senior executives across the world, Professor Kotler was ranked as the fourth

"most influential business w riter/guru" of the twenty-first century.

Dr. Kotler has served as chairman of the College on Marketing of the Institute of

Management Sciences, a director of the American Marketing Association, and a trustee of the

Marketing Science Institute. He has consulted with many major U.S. and international companies

in the areas of marketing strategy and planning, marketing organization, and international mar￾keting. He has traveled extensively throughout Europe, Asia, and South America, advising com￾panies and governments about global marketing practices and opportunities.

Gary

Armstrong is t*10 Crist W. Blackwell Distinguished Professor of Undergraduate Education

^ in the Kenan-Flagler Business School at the University of North Carolina at

Chapel Hill. He holds undergraduate and m aster's degrees in business from Wayne State

University in Detroit, and he received his PhD in marketing from Northwestern University.

Dr. Armstrong has contributed numerous articles to leading business journals. As a consultant

and researcher, he has worked with many companies on marketing research, sales management,

and marketing strategy.

But Professor Armstrong's first love has always been teaching. His Blackwell Distinguished

Professorship is the only permanent endowed professorship for distinguished undergraduate

teaching at the University of North Carolina at Chapel Hill. He has been very active in the teach￾ing and administration of Kenan-Flagler's undergraduate program. His administrative posts

have included Chair of Marketing, Associate Director of the Undergraduate Business Program,

Director of the Business Honors Program, and many others. He has worked closely with business

student groups and has received several campuswide and Business School teaching awards.

He is the only repeat recipient of the school's highly regarded Award for Excellence in

Undergraduate Teaching, which he has received three times. Most recently, Professor Armstrong

received the UNC Board of Governors Award for Excellence in Teaching, the highest teaching

honor bestowed by the 16-campus University of North Carolina system.

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Brief Contents H üpft

Preface 16

Part 1 Defining Marketing and the Marketing Process 26 1

1 Marketing: Creating and Capturing Customer Value 26

2 Company and Marketing Strategy: Partnering to Build Custom er Relationships 60

Part 2 Understanding the M arketplace and Consumers 88 I

3 Analyzing the Marketing Environm ent 88

4 Managing Marketing Information to Gain Custom er Insights 122

5 Consumer Markets and Consum er Buyer Behavior 158

6 Business Markets and Business Buyer Behavior 190

Part 3 Designing a Customer-Driven Marketing Strategy and Mix 214 1

7 Customer-Driven Marketing Strategy: Creating Value for Target Custom ers 214

8 Products, Services, and Brands: Building Custom er Value 246

9 New-Product Development and Product Life-Cycle Strategies 280

10 Pricing: Understanding and Capturing Custom er Value 312

11 Pricing Strategies 334

12 Marketing Channels: Delivering Custom er Value 360

13 Retailing and W holesaling 392

14 Communicating Customer Value: Integrated Marketing Communications Strategy 424

15 Advertising and Public Relations 452

16 Personal Selling and Sales Promotion 480

17 Direct and Online Marketing: Building Direct Custom er Relationships 512

Part 4 Extending Marketing 550

18 Creating Com petitive Advantage 550

19 The Global Marketplace 576

20 Sustainable Marketing: Social Responsibility and Ethics 606

Appendix 1 M arketing Plan A l

Appendix 2 M arketing by the Num bers A ll

Appendix 3 Careers in M arketing A29

References RI

Glossary G l

Credits C I

Index II

9

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