marketing
500
a framework for mktg mgmt
2
topics for midterm exam
marketing: 4C  STP  4P  $
company
consumer
competition
context
segment > target >
position
product
price
situation
strategy
promotion specifics
place
profits + payoffs
success
3
C1: defining marketing
A. marketing today
1. industrial age vs information age
“cards”
“chess”
2. make a market, take a market
(blue-ocean)
(red-ocean)
4
1: the new economy
A. the digital revolution
1. consumers
2. companies
B. information age vs industrial age
1. recognize potential quickly
2. marketing: “meeting needs profitably”
5
2. marketing tasks
A. radical marketing
B. scope of marketing
C. decisions marketers make
D. marketing concepts and tasks
1.defining marketing
A social and managerial process by which
individuals and groups obtain what they need
and want through creating, offering, and
exchanging products of value with others
6
2. marketing tasks
D (2) core marketing concepts
a. target markets, segmentation
b. marketplace, marketspace, metamarket
c. marketers, prospects
d. needs, wants, demands
e. product, offering
f. value, satisfaction
g. exchange, transaction
7
2. marketing tasks
D(2) core marketing concepts
h.
i.
j.
k.
relationships and networks
channels
supply chain
competition
brand, industry, form, generic
l. marketing environment
m. marketing program
8
3. company orientations
A.
B.
C.
D.
E.
F.
G.
H.
production concept
product concept
marketing concept
integrated marketing
profitability
internal marketing
customer concept
societal marketing concept
9
4. how businesses…changing
A.major forces
more wants, more brands, stores hurt
B.company responses
reengineering, outsourcing, ecommerce,
benchmarking, alliances
C.marketer responses
relationship mktg, lifetime value,
cust-share, target-mktg, individualized,
databases, integrated mktg, channel
partnerships, everyone is marketer,
fact-based decision
10
C2:adapting marketing
A. optimizing effort
1.response curves
RESPONSE
saturation
Marginal Response
threshold
$1
EFFORT
2.equate marginal returns for all efforts
11
5. in…the new economy
A. hybrid economy
B. different activities
subcontract, keep core, benchmark,
partner, multi-functional, new
advantages, intangibles, information,
consumer groups vs products
C. old vs new economy
…relationships, information
12
6. major drivers of the n.eco
A. tech.y, globalization, deregulation
B. specific drivers
1.
2.
3.
4.
5.
6.
7.
digitalization and connectivity
disintermediation and reintermediation
customization and customerization
industry convergence
industry boundaries are blurring rapidly
there are several examples of this
new opportunities at the intersection
13
7. business practices… change
A. old economy business beliefs
B. new economy business beliefs
C. the new hybrid
14
7. business practices… change
Old Economy New Economy
Organize by product units
Focus on profitable
transactions
Look mostly at financial
scorecard
Focus on shareholders
Marketing does the marketing
Build brands thru advertising
Focus: customer acquisition
Organize by cust. segments
Focus on customer lifetime
value
Look also at marketing
scorecard
Focus on stakeholders
Everyone does the marketing
Build brands thru behavior
Focus: customer retention /
growth
No customer satisfaction Measure customer satisfaction
measurement and retention rate
Overpromise, underdeliver Underpromise, overdeliver
15
8. marketing…change
A. e-business, e-commerce,
e-purchasing, e-marketing
B. b2b, b2c, c2c, c2b, search engines
C. why did dot-coms fail?
16
9. setting up websites
A. move to emarketing, epurchasing
B. design an attractive site
context, content, community,
customization, communication,
connection, commerce
C.build a revenue, profit model
advertising, sponsorship, alliance,
membership, profile, sales,
transactions, research/info, referral
17
10. CRM
A. CRM & database marketing
1.
2.
3.
4.
5.
6.
7.
realtime service
customize
reduce defections
inc. longevity
inc. share of wallet
improve/terminate low-profit customers
focus on high value customers
18
10. CRM
Mass Marketing One-to-One Marketing
Average customer Individual customer
Customer anonymity Customer profile
Standard product Customized market offering
Mass production Customized production
Mass distribution Individualized distribution
Mass advertising Individualized message
Mass promotion Individualized incentives
One-way message Two-way messages
Economies of scale Economies of scope
Share of market Share of customer
All customers Profitable customers
Customer attraction Customer retention
19
10. CRM
B. data warehouses & data mining
1. capture information at all touchpoints
2. use the database
3. downside
high investment, not everyone uses
not everyone want relationships
4. privacy/security concerns
20
C3:value, satisfaction,…
A. there can be no satisfaction!
affect? behavior? cognition?
just use loyalty? referral?
B. value maps
perceived performance & price
fair value line
21
C3:value, satisfaction,…
performance’
RR
MB
LX
XJ
FF
price’
22
11. define value, satisfaction
A. perceived value
perceived performance, cost
B. customer satisfaction
expectation, value proposition,
experience
23
12. high performance…
A.
B.
C.
D.
stakeholders
processes
resources
culture
1. profits
2. patrons
3. process
(resources
4P
4. people
balanced
scorecard
24
13. delivering value
A. value chain
B. value delivery network
(supply chain)
25
14. attract/retain customers
A. attract customers
B. cost of lost customers
C. retain customers
D. use CRM, build equity
4. value, brand, relationship equity
3. basic>reactive>accountable>
proactive> partnership
E. strengthen bonds
financial, social, structural
26
15. customer profitability
A. measure
which customers are profitable?
16. implement TQM
A. quality is key…
B. mktg has a bigger role
id.needs, communicate, logistics,
cust.education, in touch, ideas…
27
C4: strategic planning
A. SWOT Analysis
in
out
+
S
O
-
W
T
O
S SO
T
ST
W WO WT
S=110%, W=80%, O=120%, T=70% …
SO=110*120=132%, ST=77, WO=88, WT=56
28
C4: strategic planning
B. Strategy and Causality
population
random sample
control group
control group
behavior
=
=
not
=
treatment
treatment group
treatment group
behavior
• if behaviors are unequal, cause is “treatment”, when
control group and treatment group are exactly alike
• how can you build strategy if you don’t know causes?
29
17. 3 key areas, 4 levels
A. key areas
business as investments
assessment of growth, compet’n
strategy for each business (unit)
B. organizational levels
corporate, division, unit, product
C. marketing plan
situation, strategy, specifix, success
30
18. corporate/division plans
A. mission
us? them? value? will, should be?
B. organize business units
groups, needs, technology
unique, competitor/profit variables
C. BCG: ??, **, $$, xx
D. GE model
E. intensive, integrative, diversificat’n
growth
31
18C,D: corp./div. plans
growing stars
market
???
stagnant
market
bcg
ge
$cow
hi-share
hi
market
med
attractiveness
lo
dogs
lo-share
hi
med
lo
protect
invest
build
build
manage
harvest
refocus
manage
divest
business strength
32
18E. corp./div. plans
integrative growth
backward, horizontal, forward
intensive growth
market penetration, market development,
product development
diversification growth
concentric, horizontal, conglomerate
old prod
old mkt
mkt pen
sim mkt
mkt exp
new mkt
mkt dev
sim tech
tech exp
biz exp
conc div
new prod prod dev
hor div
cong div
33
19. business str’gic planning
A. mission
B. SWOT
- internal, external environments
C. goals
- priorities, specific, realistic, good
D. strategy
1. low cost, differentiate, focus
2. is operational effectiveness sufficient?
3. strategic & marketing alliances
E. program formulation & implementation
F. feedback/control
1. change happens, effectiveness vs. efficiency
34
20. the marketing process
A. The Value-Delivery Sequence
B. Steps in the Marketing Process
C. Product Planning:
The Contents of a Marketing Plan:
1.Executive Summary and Table of Contents
2.Current Marketing Situation [4C]
3.Opportunity & Issue Analysis [SWOT+Issues]
4.Objectives (Financial, Marketing) [$’]
5.Marketing Strategy [STP]
6.Action Programs [4P]
7.Financial Projections [$]
8.Controls
35
21. managing the process
A. organize the department
functional, geographic, product
market, product-market,
corporate-divisional, global
B. build a marketing orientation
C. creativity
D. implementation
E. evaluation/control
annual, profit, efficiency, strategic
36
C5: markets, demand, envt
A. reliability
consistency
B. measure many times
1. multiple-item scales
2. statistical analyses
e.g., correlation
among items
valid
reliable
C.
validity
accuracy, correctness
D. check for validity
1. face/content validity
does it look right?
2. concurrent validity
does it relate to what
it should relate to?
3.
discriminant validity
does it tell different
groups apart?
4.
predictive validity
what is its track record?
valid & reliable
37
22. what to watch?
A. wants, preferences, behaviors
B. shifts, non-price competition, tech
C. info needs changing
38
23. information, intelligence
** more info ~ more better (MIS)
** input ~ info ~ insight ~ integrate
A. internal records
B. mktg intelligence
C. mktg research
systematic, suppliers, steps:
define, design, gather data,
analyze, present use
D. mktg decision support systems
39
24. forecast demand
A. which market?
potential, available, served, penetrated
B. demand measurement
demand, minimum & potential
C. company demand
D. estimate current demand
E. estimate future demand
macro, micro, methods
40
25. macro environment
A. trend spotting
B. demographics
C. economy
D. natural
E. technological
F. political/legal
G. social cultural
H. shifts of secondary values
41
C6: analyze consumers
A. are you a computer?
B. Rb is not the same as Ra
purchase
Rb reasons before
time
Ra reasons after
C. everyone escalates
* reactance, consistency+closure, framing
* unanticipated discoveries, hunger?
42
26. how/why you buy
A. cultural factors
cultures, sub-cultures, social class
B. social factors
reference groups: membership, opinion
leader, family of origin and procreation,
roles/status
C. personal factors
1.
2.
3.
4.
age, lifecycle, family lifecycle,
occupation and economic situation
lifestyle, psychographics (VALS)
personality, brand personality, self-concept
sincerity, excitement, competence, sophistication, ruggedness
43
26. how/why you buy
D. psychological factors
1. motivation
: Freud: sex sells ?!, laddering
: Maslow: hierarchy of needs:
actualization, belonging, competence
: Herzberg: satisfiers (become) dis-satisfiers
2. perception
: selective attention, selective distortion,
selective retention
3. learning
4. beliefs and attitudes
44
27. buying decision process
A. buying roles (initiate, influence…
B. buying behaviors
[involve, diff’s
complex, dissonance,
variety seeking, habitual
[hh, hl
[lh, ll
C. stages
problem recognition ~ search ~ DMM
evaluation ~ purchase ~ post-purchase
D. gauging customer satisfaction
measure, reduce complaints
45
DMM decision-making-matrix
memory graphics
weights >
4
5
IBM
3
3
Dell
4
4
Compaq
HP
3
4
4
4
speed
5
5
3
totals
52
51
5
4
57
56
• redesign the computer
• change weights
• change beliefs about us
• highlight neglected criteria
• change beliefs about them • shift the buyer’s ideals
pages: 206-207
46
C7: analyze customers
A. is business entertainment ethical?
B. international business decisions?
become same? more different?
47
28. organizational buying
A. consumers v customers
fewer, bigger, professional buyers
inelastic, fluctuating, derived demand
B. specialized markets
institutional, government
C. business buying situations
straight rebuy…new task
systems buying & selling
48
29. participants in b.buying
buying center: initiators, users…
A. major influence
envt, orgzn, interpersonal, indiv.
B. cultural influence,
different customs
become same? more different?
49
30. purchasing process
A. problem recognition
B. need description, specifications
C. supplier search
D. proposal solicitation
E. supplier selection
F. order routine specification
G. performance review
50
C8: dealing with competition
A. what do you choose first:
brand or form?
B. brand share vs. form share?
hi
brand share
lo
lo
hi
form comp
leave?
defend
brand comp
form share
51
C8: dealing with competition
form-first
vs
brand-first
insurance
insurance
agent
web
1-800
State Farm Progressive State Farm
Allstate
Allstate? Allstate?
Allstate
agent
web?
1-800?
State
Farm
agent
1-800
Progressive
web
52
31. competitive markets
A. market attractiveness (5forces
B. identify competitors
brand, industry, form, generic
C. industry concept of competition
#sellers/buyers, entry-exit barrier,
cost structure, vertical integration,
globalization
D. market concept of competition
same need satisfied? substitutes?
53
32. competitor analysis
A. strategies
B. objectives
C. strengths, weaknesses
dominant…weak, nonviable
share of mind + heart  market
D. reaction patterns
54
33. competitive intelligence
A. design the system
setup, collect, evaluate, disseminate
B. select competitors to attack/avoid
customer value analysis
classes:
strong…weak,
close…distant
good…bad
55
34. design comp. strategies
A. market leaders
expand market, defend, + share
B. market challenger
objectives & opponents, attack
C. market follower
imitation: clone, adapt
D. market nicher
specialize, margin not volume
E. be customer+competitor focused
56
topics for final exam
marketing: 4C  STP  4P  $
company
consumer
competition
context
segment > target >
position
product
price
situation
strategy
promotion specifics
place
profits + payoffs
success
57
C9: identifying segments
A.why segment?
1. increase effectiveness and efficiency
buyers
inefficient
non-buyers
efficient +
effective
ineffective
2. segments must be …
: homogeneous within
: heterogeneous across
: too many mixes means too much cost
: too few mixes means too much dissatisfaction
58
35. buyers differ…
A. Segment marketing
B. Niche marketing
C. Local marketing
D. Individual marketing
E. Segmentation patterns
F. Process: survey, analyze, profile
G. Effective Segmentation
measurable, substantial, accessible,
differentiable, actionable
59
36. segmenting markets
A. …consumer markets
1. geographic
2. demographic
3. psychographic
4. behavioral
occasions, benefits, user-status
usage rate, loyalty, readiness,
attitude
5. multiattribute ~ geoclustering
60
36. segmenting markets
B. …business markets
1. stage in purchase decision
channel preference
2. type of buyer
programmed, relationship,
transaction, bargain hunters
3. buyer groups
transactional, consultative,
enterprise
61
37. targeting strategies
A. evaluate/select segments
1.
2.
3.
4.
5.
single segment
selective specialization
product specialization
market specialization
full market coverage
B. targeting multiple segments
C. ethical choice of market targets
62
C10: developing…products
A. humanize product design
1.
2.
3.
4.
5.
implicit models
feedback
expert / novice modes
smarter interfaces
smarter products
63
38. challenges in NPD
A. types of new products
new new, new product lines, additions,
revisions, re-positionings, $reductions
B. why they fail or succeed
90+% fail,
-overestimates, -design,
-incorrect positioning, -costs, -compet’n
+know consumers, +value, +head start,
+contribution margin, +budget,
+teamwork, +top-mgmt support
64
39. managing new products
1.
2.
3.
4.
idea generation
idea screening
concept development, testing
strategy development
mix, long run sales profit goals
5. business analysis
estimate sales, costs, profits
65
40. managing new products
6. product development
7. market testing
consumer goods
sales-wave, simulated store,
controlled, test markets
business goods
alpha, beta, trade-shows
8. Commercialization
when, where, to whom, how
66
40. managing new products
Why does prolonging the fuzzy front
end reduce the length of the new
product development?
FFE
1-5
BE
6-8
Market monopoly means
more profits, shorten the
NPD time.
For both leader and follower,
NPD
67
41. adoption process
A. stages in adoption:
awareness, interest, evaluation, trial
adoption
B. factors affecting it
readiness, personal influence,
innovation characteristics,
organizational buying readiness
68
42. …product life cycle
A. plc: intro, growth, maturity, decline
B. introduction
rapid/slow skimming/penetration
pioneering advantage (questionable
competitive cycle: sole…commodity…die
C. growth: place-to serve demand
D. maturity:
change mkt, product, mix
E. decline:
inc/dec inv., harvest, divest, drop?
69
42F. critique
 poor for forecasting
 okay for planning control
 what stage are you in?
 dependent on managers? or
 independent of managers?
 rapid cycles today, manage across
70
43. positioning/differentiation
A. two views:
consumer mind, value disciplines
B.
C.
D.
E.
how many ideas to promote?
communicate the positioning
add further differentiation
differentiation tools
product, service, personnel, channel,
image
71
C11. product/brand strategy
A. private labeling
retailer
manufacturer
consumer
B. extending your brand name
consistent category, quality, consumer
72
44. product, product mix
A. product levels
core, basic, expected, augmented,
potential
B. product classifications
durability: nondurable, durable…
consumer: convenience, specialty…
business: materials, capital items…
C. product mix
length, depth, consistency
73
44c. product mix
mix width
line
length
item
PRODUCT-MIX WIDTH
Detergents
PRODUCTIvory Snow
LINE LENGTH
Dreft
Tide
Cheer
Toothpaste
Gleem
Crest
Bar
Soap
Ivory
Kirk’s
Lava
Camay
Diapers
Tissue
Pampers
Luvs
Charmin
Puffs
Banner
Summit
74
45. product line decisions
A. product line analysis
sales/profits; market profile
B. product line length
down/up-market, 2way, filling (jnd
C. line modernization
updating, featuring, pruning
2%
2%
3%
4%
5%
jnd=1%
3% 4% 5%
6%
6%
7%
7%
75
46. branding
A. what is a brand?
…attributes, benefits, value, culture,
personality, user…
B. brand equity
…switcher>satisfied>switching-costs>
friend> devoted…
C. branding challenges
2b/x2b? sponsor, name, extensions,
multibrands, audit & reposition
76
47. packaging and labeling
A. packaging
levels of material
promo value:
selfservice…image…innovation
B. labeling: …legal concerns
how can packaging affect all 4Ps?
77
C12: services
A. can services be off-shored?
78
48. nature of services
A. categories of services
services
goods
B. characteristics
1.
2.
3.
4.
intangible
inseparable
variable (inconsistent)
perishable (impossible to inventory)
79
48b…services
A.Intangible
tangibilize
B.Inseparable
differentiate
C.Inconsistent
hire, train, motivate,
standardize
manage point of contact ~
moment of truth
D.Inventoryless change supply-side
change demand-side
80
49. service strategies
A. managing differentiation
B. service quality
1.provide better quality
2.eliminate gaps (SERVQUAL
3.RATER
reliability, assurance, tangibles, empathy, responsiveness
4.excellence
customer obsessed, commitment, self-service, monitoring,
manage complaints, employees satisfaction
5.productivity
81
consumer
49. SERVQUAL
Word-of-mouth
communications
Past experience
Expected service
Gap 5
Perceived service
Gap 1
producer
Personal needs
Service delivery (including
pre- and post-contacts)
Gap 4
Gap 3
External
communications to
consumers
Translation of perceptions
to service-quality specifications
Gap 2
Management perceptions
of consumer expectations
82
50. product support services
A.presale
B.post-sale
C.trends:
more reliability, unbundling, 3rd party, contracts,
more choices, quality of call centers, better
trained service representatives
83
C13. pricing
A. behavioral pricing
buy now pay more later
pay now, use less later?
is a dollar a dollar?
why pay more with credit cards?
B. legal issue
no price discrimination,
no horizontal/vertical price fixing
no bait-and-switch
C. break-even
84
C13. break even quantity
TR
$/units
TC
VC
BER
FC
BEQ
units
10K 20K 30K 40K 50K 60K 70K 80K
pages: 482
85
C12. break even quantity
(contd)
TR
$/units
good break-evens
TC
bad break-evens
BER
FC
BEQ
units
10K 20K 30K 40K 50K 60K 70K 80K
86
51. setting the price
A. select the objective
survival, profit, share, skim, other
B. determine the demand
sensitivity, demand, elasticity
C. estimate costs
D. analyze competitors
E. select pricing method
markup, target return, perceived value, value,
going rate, auction, group
F. select final price
87
51F. selecting final price
1. psychological pricing
price-quality, reference price, odd-even
2.
3.
4.
5.
gain and risk sharing
marketing mix influence
pricing policies
price impact on other parties
88
52. adapting the price
A.
B.
C.
D.
geographical pricing
price discounts
promotional pricing
discriminatory pricing
segment, form, image, channel, time
E. product mix pricing
product line, optional feature, captiveproduct, two-part, byproduct, bundling
89
53. initiating/responding…
A. initiating cuts
excess capacity, dominate market
B. initiating increases
cost inflation, anticipatory,
over-demand
C. reactions to price change
D. respond to competitors $changes
90
53E. strategic options
1.
2.
3.
4.
5.
6.
=price, =quality, cut customers
+price, + quality
=price, +quality
–price, +quality
- -price, =quality
- -price, -quality
7. =price, -quality
8. new low price model
91
C14. channels
A. push versus pull
pull
producer
push
customer
(retailer)
consumer
push
B. you can eliminate a channel
member but not the function
producer
consumer1
$?
$1
producer
wholesaler
retailer
consumer2
92
54. marketing channel system
A. value network
1.upstream vs downstream emphasis
2.awareness of where problems occur
3.online development with partners
B. marketing channels
1.interdependent organizations
2.distributes goods and/or services
3.hybrid channels today: online, direct, indirect
4.consumers want channel integration
93
55. what work…channels do
smooth flow of goods/services, save
money & time through specialization
A.
B.
C.
D.
channel functions
channel levels
service sector channels
i-way
bandwidth, extranets, intranets
94
56. channel design
A. customer’s desired service output
lot size, wait, space, variety, service
B. objectives & constraints
C. identify alternatives
type, #: exclusive, selective, intensive
D. evaluate alternatives
95
57. channel management
A. selecting members
B. training them
C. motivating them
partnerships, long-term programming
D. evaluating them
E. modifying arrangements
96
58. channel dynamics
A. vertical marketing systems
no controller
1. corporate and administered
2. contractual (franchises, etc
3. systems compete, not companies
B. horizontal marketing systems
C. multichannel marketing systems
97
58. channel dynamics
D. conflict, cooperation, competition
1. types of conflict
vertical, horizontal, multichannel
2. causes
goal incompatibility, unclear roles/rights,
differences in perception, “over”dependence
3. managing conflict
superordinate goals, exchange people,
joint membership, mediation/arbitration
98
58. channel dynamics
E. legal and ethical issues
1.
2.
3.
4.
exclusive dealing
exclusive territories
tying agreements
dealers rights
99
C16. integrated “marcom”
A. communication is a human activity!
B. does communication work better when
the receiver and sender are alike
(homophily) or when they are different
(heterophily)?
C. are attractive spokespeople more
credible?
D. how do you decide on the right
campaign among the several you have
designed?
100
59. develop communications
A. identify target audience
1. image analysis: familiar/favorable
2. image content: semantic differential
B. communication objectives
1. cognitive, affective, behavioral
2. hierarchy of effects:
aware, know, like, preference,
conviction and purchase
AIDA=aware, interest, desire, action
101
59. develop communications
C. design the message
1. content
rational, emotional, moral appeal
2. structure: one/two sided argument
3. format
4. source
expertise, trustworthy, likable
attractive
102
59. develop communications
D. select channel
personal, non-personal
E. establish budget
affordable, percentage of sales,
competitive-parity, objective and task
F. select mix
promotional tools
(ad, sales promo, pr, selling, direct)
based on: product, buyer readiness,
product life cycle stage
103
59. develop communications
G. measure
recognition, recall, attitudes
H. manage the integrated “marcom”
comprehensive plan
strategic roles of different types
combine types for clarity, consistency
and impact
104
60. advertising campaigns
A. set the objectives
inform, remind, persuade
B. decide budget
plc stage, share, clutter, frequency,
substitutability
C. choose message
generate message, evaluate, execute,
review social responsibility
105
60. advertising campaigns
D. media strategies
1.reach, frequency, impact
2.select media vehicles
3.decide on timing
macro/micro-schedule, timing
blitz
pulse
E. evaluate advertising effectiveness
communication effect, sales effect, effectiveness
106
61. sales promotion
A. purpose:
attract new triers, reward loyal consumers,
increase repurchase, attract brand switchers,
short run gains for similar brands
B. major decisions
establish objectives, select tools, develop
programs, test/implement, evaluate
sales
time
promotion
107
62. public relations
A.marketing pr
B.major decision
1.establish objectives
2.choose message and vehicles
3.implement and evaluate plan
:exposures, awareness/attitude change
:best sales/profit impact
108
63. direct marketing
A. explosive growth
B. benefits:
focus and timing, demassification
C. integrated direct marketing
D. major channels
sellers, direct mail, catalog, telemarketing,
direct response TV ads, kiosk, e-marketing
[blanketing, databased, interactive,
personalized, lifetime value based]
109
conclusions
A. analyze each part+process
B. 4C are the players
C. strategy is [C~3C]
midterms
D.marketing strategy is STP
E. “specimix” [specify mixes]
finals
110
topics for final exam
marketing: 4C  STP  4P  $
company
consumer
competition
context
segment > target >
position
product
price
situation
strategy
promotion specifics
place
profits + payoffs
success
111