MB - Marketing and Business [OVERVIEW]

Marketing and Business

Introduction

From 1900-1920 business was focused on production. The emphasis was on producing and distributing new products. Production processes were simple and only a few product choices were available. Consumers had limited money to purchase products. Businesses believed that if they could produce the products, they would be able to sell them.
From 1930-1950 business was focused on sales. Production became more efficient resulting in a large number of products at lower costs (assembly lines and transportation systems used). The American standard of living was improving. Companies began to rely on salespeople to represent their products and convince potential customers their product was better than the competition.
After World War II, business started focusing on the marketing department. After WWII the economy expanded, wage level increased, and the amount of work hours decreased. Businesses began to use advertising to inform the consumer of products, reasons to buy the products, and where the products were located.
In the 1970's business focused on the marketing concept. There was a changing paradigm from what the business produces to what the customer wants. Marketing became more than just the work of one department. It required the interaction of all the departments within a business to work closely with others throughout the organization. The marketing concept became a proven and effective method that is used by the majority of successful businesses and organizations.
Ultimately, marketing is important to every business because marketers make decisions that dramatically affect businesses' long-term profitability.

Essential Questions

  1. What role does a business play in society?
  2. What types of activities are businesses involved in?
  3. What are the different types of business ownerships?
  4. What are the functions of business?
  5. How is management used in business?
  6. What is the role of stockholders in business?
  7. What are the trends in marketing?
  8. Why is corporate social responsibility important in business?

Key Terms

  • Functions of Business - The activities needed to operate a business can be divided into a number of functional areas management, operations, marketing, accounting, and finance.
  • Business Ethics - is a form of applied ethics or professional ethics that examines ethical principles and moral or ethical problems that arise in a business environment. It applies to all aspects of business conduct and is relevant to the conduct of individuals and entire organizations.
  • Corporate Social Responsibility - Corporate citizenship refers to an organization's responsibility to create business value by caring for the well-being of all stakeholders including the environment
  • Sole Proprietor - These firms are owned by one person, usually the individual who has day-to-day responsibilities for running the business, own all the assets of the business and the profits generated by it, they also assume complete responsibility for any of its liabilities or debts.
  • Corporation - Form of business ownership that is a legal entity on its own and puts stockholders/shareholders and the board of directors in control. Owners have limited liability for the corporation's actions. A corporation has unlimited life and in most cases is taxed as an entity on its own.
  • Partnership - Can be general or limited, but in either case the general partners are in control. The tax burden is shared by all the partners at their personal rate, and the general partners have unlimited liability. Limited partners have limited liability.
  • Shareholder - The shareholders elect a board of directors to oversee the major policies and decisions in a corporation.
  • Management - Getting people to work together for the attainment of an organization's goals and objectives. Management processes include planning, organizing, directing and controlling.
    • Planning: Setting strategic direction (long-range) and determining actions or programs to achieve the objectives.
    • Organizing: Creating a structure with which to achieve company goals forms the core of organizing.
    • Leading: The management of the company.
    • Controlling: The process of measuring performance, comparing results to objectives and taking action to correct or improve is the last function of management.

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