Introductory Marketing_14nd
Introductory Marketing
Lecture 15
Summary of Lectures
Kazutaka Komiya
komiya@em.u-hyogo.ac.jp
Summery of Lectures
1.
2.
3.
4.
5.
Summery of Lectures Part 1
Comments on the First Report Assignment
Summery of Lectures Part 2
Nots on the Second Report Assignment
Course Evaluation Questionnaire
1
Introductory Marketing_14nd
2. Summery of Lectures_ Part 1
Definition of Marketing
• “Marketing is the activity, set of institutions, and processes
for creating, communicating, delivering, and exchanging
offerings that have value for customers, clients, partners,
and society at large”（American Marketing Association 2013）
• Essence of Marketing
 Key word: value
 To create, communicate and deliver value of offerings to
customers
Creating Value
① Satisfying a need
 But, in a competitive environment, simply satisfying a
need is not enough to give high value
② Differentiation
 Creating distinct products from competitors
 Differentiate your products while satisfying a need
Differentiate from competitors while meeting customer needs
2
Introductory Marketing_14nd
Marketing Management (MM)
• Activities and processes when implementing marketing
 Basic theory of marketing
• Research Phase
 Research as a starting point
 Conduct research at each phase
• Various data
 Internal Data, Marketing intelligence and Marketing research
data
Marketing Management
Macro Environment Factor
Political, Social, Economic,
Technological factors
Research
Task Environment Factor
Marketing is the activity for creating,
communicating and delivering value
of offerings to customers
Marketing Mix
Product, Price,
Promotion
& Place
Consumer
Own
Company
Segmentation
&
Targeting
Competitors
Positioning
Value
Proposition
(or Concept)
STPV
Implementation & Evaluation
3
Introductory Marketing_14nd
Data in Marketing Management
Internal Data
Marketing intelligence
Marketing research
data
Data that the company has internally
 In-store and online sales data
 Web and social media site visits, etc.
Data publicly available about consumers, competitors etc.
 Benchmarking competitors' products: competitor’s
products as a criteria of product quality
 Monitoring social media, etc.
Data collected proactively by companies
 Survey
 Interviewing
 Observation
Analyzing Environment
• Macro and Task Environment factors
 Macro: Political, Social, Economic, Technological factors
 Task: Consumers & partners, Competitors, Own company
• Buyer Decision Process (BDP)
 Need recognition, Information search, Evaluation of
alternatives, Purchase Decision, Post-purchase Behavior
 Consumer research along each stage of the BDP
 Processes are often simplified: familiar products
4
Introductory Marketing_14nd
Macro Environment Factors
Factors
Examples
Political
Tax system, Subsidies
Economical
Economic trends, Currency
exchange rates
Social
Environmental issues,
Infectious diseases
Technological
SNS, AI, Flying car
Nabe-cube case
Aging Population
Popularity of Japanese food
overseas
Task Environment Factors
Factors
Examples
Nabe-cube case
Consumers
and partners
Consumer characteristics and
needs, Distribution system
(Wholesale and retail)
Heavy to carry, Difficult to
adjust the amount per person
Competitors
Characteristics of competing
companies and their
products
Only liquid-type products in
the market
Own company
Management resources
(money, technology,
networks etc.)
Technology to turn powder
into solid, and easy to
dissolve
5
Introductory Marketing_14nd
Buyer Decision Process
Process
1. Need Recognition
2. Information
Search
3. Evaluation of
Alternatives
Buyers' actions
• Buyers recognize a problem
(lack something) or need
• Buyers try (or do not try) to
obtain information from
several sources
• Buyers evaluate alternative
products depending on the
situation
4. Purchase Decision • Buyers buy the product
5. Post-purchase
Behavior
Examples of consumer analysis
• What are consumers’ needs?
• Which media do consumers
get information from?
• What brands do consumers
consider to be alternatives?
• Where are consumers
buying?
• Buyers perceive satisfaction or
• How satisfied are consumers
dissatisfaction according to
with the products?
their prior level of expectations
Segmentation and Targeting
• Segmentation
 Divide diverse markets into smaller segments
 Consumers in a segment may have similar needs
• Targeting
 Evaluate and decide which segments a company can target
 Segmentation is a preparation for targeting
 Segmentation and targeting as a single process
6
Introductory Marketing_14nd
Example of Segmentation and Targeting: Age and Gender
Over
50's
Market
（Set of Consumers）
30’s40’s
10’s20’s
10’s-20’s
female
Female
Male
Segmentation
Targeting
Positioning and Value Proposition
• Positioning: Position the product as different from
competitors
 Process for differentiation
 Often use positioning map
• Value proposition: State clearly the benefits consumers get
 Guide the whole marketing activities
 Expressed as a slogan in advertising
 G-SHOCK: “Absolute toughness”
7
Introductory Marketing_14nd
Easy to carry and handle
Positioning Map: Nabe soup market
Nabe-cube
Liquid-type
nabe soup
Easy to adjust amount
2. Comments on the First Report Assignment
• First Report Assignment
 Propose a marketing plan to increase the value of your
hometown as a tourist destination
• Important points
 Mechanism of creating value from marketing perspective
 Satisfying (target) needs and Differentiation
 Who is the target group and what are the areas of
competition?
 How do you differentiate your homewon from competition
areas?
8
Introductory Marketing_14nd
First Report Assignment
• Propose a marketing plan to increase the value of your hometown as a
tourist destination
 First, briefly introduce your hometown. The subject should be a city (ex. Kobe city),
town or village, but more limited areas such as "XX ward" or "YY district" are also
acceptable. Then, propose measures to increase the value of the area as a tourist
destination from a marketing management perspective
 In class, we assumed tangible products, but you can apply this to 'area'. (Note that
Place (channel) in the 4Ps does not need to be considered)
 Mayor or prefectural governor, is the actor of this marketing activities, but you can
also assume other actors, such as companies, NPOs, etc.
 If your hometown is difficult to address, you can feature other areas, such as ‘Kobe
City‘ or a neighborhood in your hometown
 List any references or websites to refer to at the end of the report
 It should be at least 400 words
 Submit your report in Word or PDF format to the “Task submission” site of
Introductory Marketing, UNIVERSAL PASSPORT
 For Questions use email (komiya@em.u-hyogo.ac.jp) or class Q&A
 Deadline: January 8th (Wed) before midnight
• Example: Kobe city’s marketing plan
 Target group: Foreign tourists and middle-aged (over 30 to
60s) tourists
 Competition area: Kyoto and Osaka city
 These areas have many historical sites and unique local
foods
 But these cities have no famous tourist spots for alcohol
 Idea: Japanese Sake Tour
 Kobe City's Japanese Sake Breweries launch Sake Tour
 Tourists can watch how sake is made and taste different
kinds of sake
9
Introductory Marketing_14nd
2. Summery of Lectures_ Part 2
Brand
• Name, sign, symbol, or design or a combination of these
that identifies the maker or seller of a product or service
 Distinguishing from other products, and basis for the product’s
image
 Powerful tool for product differentiation
 Brand Hierarchy: the range covered by brand
• Brand and Product Development
 Brand Decision: Determine STPV and brand elements
 Product Decision: Develop each product under brand decision
Marketing Management
Macro Environment Factor
Political, Social, Economic,
Technological factors
Research
Task Environment Factor
Marketing is the activity for creating,
communicating and delivering value
of offerings to customers
Marketing Mix
Product, Price,
Promotion
& Place
Consumer
Own
Company
Segmentation
&
Targeting
Competitors
Positioning
Value
Proposition
(or Concept)
STPV
Implementation & Evaluation
10
Introductory Marketing_14nd
Brand Hierarchy
Product Brand
Brand of products within the product category
Category Brand
Brand of a group of products in multiple
categories
Business Unit Brand
Brand of the business unit in a corporation
Corporate Brand
Brand of separate corporate entities
Corporate Group Brand
Brand of a corporate group entity as a whole
Process of product development
Branding Decisions
Product Decisions
• STPV( Segmentation & Targeting,
Positioning, Value proposition)
• Brand elements (name, symbol…)
• Idea Generation, Idea Screening,
Concept Development & Testing,
Business analysis, Product
Development
“Not stop, not go wrong, not break”
11
Introductory Marketing_14nd
Product Life Cycle
Adoption of Innovation:
• Timing for adopting new ideas varies from person to person
 Innovators, Early Adopters, Early and Late Majority, Laggards
Product Life Cycle (PLC)
• The course that product sales and profits follow from
introduction to removal
 Introduction, Growth, Maturity, Decline
 Consumers (adopters joining in) are different at each stage
Adopter Categorization
Innovators
Early Adopters
Early Majority
Are venturesome*, interested in new ideas and can
process detailed product information
Enjoy leadership roles (opinion leader) and can process
detailed product information
Need to see evidence that innovation works before
adopting it
Late Majority
Are skeptical of change and innovation
Laggards**
Locked into tradition and are very conservative
* "Venturesome" means to be willing to take risks
** "Laggard" means people who take actions slowly
12
Introductory Marketing_14nd
Sales and Profit
Product Life Cycle
Sales
Profit
0
Time
Introduction
Growth
Maturity
Decline
PLC and Marketing Actions
Introduction
Growth
Maturity
Decline
Sales
Low
Rapidly rising
Peak and decline
Decline
Cost
High
Average
Low
Low
Profit
Negative
Rising
High
Decline
Market
Few
Competitors
Competitors
rapidly increasing
Competitors
gradually decreasing
Few
Competitors
Innovators and
Early adopters
Early majority
Late majority
Laggards
---
Provide detailed
Build interest of
product
Marketing
product through
information
stores and
Actions
(functions or
advertising
ingredients)
Emphasize
differentiating
factors of the
brand
Minimal
activities
Customer
(joining in)
13
Introductory Marketing_14nd
Dominant Design
• Dominant Design (DD)
 Standard technologies and designs that have survived the
competition
 iPhone Case
 Product development is different before and after DD is
established
Dominant Design (DD) and Product Development
Before DD
Market
• Few Competitors
• Various designs and
technologies
• Company can create
innovative brand image
when it contributes to
Product
establishing DD
Development
• High product
development cost
• High risks of failure
After DD
• Competitors growing and
eventually decreasing
• Product differentiation
based on DD
• Lower product
development costs and
risks
• Need to survive in tough
competition
14
Introductory Marketing_14nd
Pricing
• Considerations in Pricing
 Decide the price ranging from the consumer's perceived
value to product cost
 Take into consideration of related factors: competitors' prices,
etc.
• Basic Pricing Strategy: High Price Setting
 Consumers are willing to pay a higher price when companies
can offer differentiated and unique products
 High price is a sign of marketing success
Considerations in Pricing
Product
cost
Price floor
No profit below
this price
Low
Competition and
other factors
Competitors’ prices
Marketing strategy (STPV) and other
marketing mix (product, promotion, place)
Price
Consumer
perception
of value
Price ceiling
No demand above
this price
High
Armstrong, Gary; Kotler, Philip; Opresnik, Marc Oliver. Marketing: An Introduction, Global Edition, p.293, partially edited
15
Introductory Marketing_14nd
Generic Strategies
• How to respond to consumer segments who want low
price
 Adopt low-price strategy at company-level, not product-level
• Generic strategies: Framework to gain competitive
advantage at the company level
 Cost leadership: Lower costs based on economies of scale
 Cost Focus：Provide low-priced products through unique
approach (few cases)
Characteristics of Generic Strategies
• Provide high value-added products through differentiation in a
Differentiation
wide range of segments or products areas
Strategy
• Offer a relatively high price
• Develop high brand image
Cost
Leadership
Strategy
• Provide low-priced products in a wide range of segment or product
areas
• Achieve lower costs based on economies of scale
• Do not aggressively create product differentiation
• Concentrate resources on a particular segment or a product area
 To compensate for the disadvantages of a small company size
• Aim for product differentiation or cost reduction
Focus Strategy • Differentiation Focus：Provide specialized or unique products through
high expertise
• Cost Focus：Provide low-priced products through unique approach
 Limited quantity, but low-cost raw materials can be used
16
Introductory Marketing_14nd
Promotion
• Promotion: activities to inform consumers about the
product
 Promotion mix: methods to promote products
• Advertising
 Each advertising has purposes
 Introduction or growth phase: Increase awareness, provide
detailed information and how the product differs from others
 Maturity phase: communicate the image of the brand to the
majority adopters
Promotion Mix
Advertising
• Paid form of non-personal promotion of products with various
use of media
 Can reach masses of geographically dispersed consumers
Media: TV, Newspaper, Magazine, SNS (Paid form)… etc.
• Promotion with a wide assortment of tools
 Immediate effect and flexibility (area or term)
Sales promotion
Coupons, Discounts, Free sample, Event (ex. HARLEYDAVIDSON), Prize (ex. Original goods can be won after
purchase)
Personal selling
• Personal interactions with consumers by salespeople
 Can observe consumers’ needs and characteristics and
make quick adjustments
Salespeople promotion in car dealers or cosmetic shops in
department stores
17
Introductory Marketing_14nd
Promotion Mix (continued)
Publicity (Public
relations, PR)
• Non-paid provision of information about products with
media owned by other companies
 Consumers tend to feel more real and believable
than advertising
Feature product on TV programs, or magazines
Direct and digital
marketing
• Direct and digital form of promotion
 Well suited to highly targeted marketing efforts
Direct: Sending E-mail, Catalogs… etc.
Digital: Website, YouTube, Social media (Instagram,
Twitter… etc. )
Distributors and Marketing Channels
• Wholesaler (卸売業者 oroshiuri-gousya): Companies
primarily engaged in selling products to buyers for
resale or business use
• Retailer (小売業者 kouri-gousya): Companies primarily
engaged in selling products directly to final consumers
• Marketing (Distribution) Channel
 A set of interdependent organizations (mainly W and R)
that help make the manufacturer’s products available
18
Introductory Marketing_14nd
M1’s Marketing Channel
Marketing Channel
M1
M2
M3
W2
R4
C
W3
W1
R2
C
M: Manufacturer
W:Wholesaler
R: Retailer
C: Consumer
R3
R1
C
C
C
R5
C
C
Use of Distributors
• Distributers (W and R) make products available to
consumers efficiently
 Assortment (a group of various products) allows consumers to
get a variety of products in a single shopping trip
 The number of transactions (buy and sell) will be reduced in
total
• Why do Manufacturers use Distributers?
 Efficiency and Reduction in Investment
 Potential for increased consumer exposure and sales of
product
19
Introductory Marketing_14nd
Reduced Transactions with a Distributer
m
n
M1
C1
C
M2
C2
M3
M
C3
M1
C1
3 × 3 = 9 mn
m,n＞2, then, mn＞m+n
M2
M3
D
Assortment
C2
C3
3+3=6
m+n
M: manufacturer, C: consumer, D: Distributer (Retailer)
Assortment: a group of various products
Chanel Management
• Conflict between Manufacturers and Distributors
 Distributors may do things differently than the manufacturer's
marketing intentions
 Manufacturers aim to overcome conflicts and sell as intended
through channel management
 Manufacturers can control distributors if the power
relationship is favorable
20
Introductory Marketing_14nd
Conflict between Manufacturers and Distributors
Distributor
• Want to have an assortment of products from many
manufacturers for sales, profits, and consumers
• Want to set low price
• Want to decide whether or not to provide service (e.g.,
product explanation, after-sales service) themselves
because of increased costs
• Do not want distributers to sell competing products
Manufacturer • Want to limit low-price sales
（Marketer） • Want to provide adequate service
Power Relationship
• Power relationship: One side controls the other
• Generating power relationship
1. Brand (Store) power: Manufacturers with high-value
brands or retailers with attractive stores can have power
2. Transaction dependency
21
Introductory Marketing_14nd
Power relationship through transaction dependency
Sell
Manufacturer
X
Distributor
(Retailer) Y
5 million yen
per month
Total sales per month:
100 million yen
X’s sales dependency on Y:
5 million / 100 million = 5%
Buy
Total purchases per month:
10 million yen
Y’s purchase dependency on X:
5 million / 10 million = 50%
• If X cannot sell to Y, X will lose 5% of its total sales. This will not have
a great impact on the X's business.
• If Y cannot buy from X, Y will lose half of its total purchases. This will
have a great impact on the Y's business.
To avoid this, Y follows X’s instructions. X has the power to Y
Brand Management
• Brand Equity
 Brand’s ability to capture consumers preference
• Brand management
① Develop brand equity over the long term
 Maintain brand freshness through product updates and
value proposition adjustments
② Effective use of brand equity
 Brand Extension: extend brand to products in a new
category
22
Introductory Marketing_14nd
Main Components of Brand Equity
Brand Awareness
• The more well-known a brand is, the higher its value
Perceived Quality
• The higher the quality perceived by customers, the
higher its value
Brand Loyalty
• The more customers who provide exceptional support
for the brand (loyal customers), the higher its value
Brand Associations
（Image）
• The stronger, more favorable and unique associations
(images) the brand has, the higher its value
3. Notes on the Second Report Assignment
• Second Report Assignment
 Propose your value proposition at the time of your
employment and what you should do during your time at the
university
• Important points
 What is your value proposition?
 Value that your employer recognizes and that should be
differentiated from your competitors
 Who is your employer (target) and who are your competitors?
23
Introductory Marketing_14nd
Second (Final) Report Assignment
• Assume that you will be hired by a company or other organization (e.g.
city hall) after graduation. In order for the employer to recognize your
value, consider yourself as a marketing object and decide on the value
proposition at the time of your employment, taking into account STP. In
addition, propose what you should do during your time at the university,
as part of product development in terms of marketing management
 If it is difficult to assume employment with a company or other organization, set a
different goal and decide on your value proposition upon graduation
 Write the name of the lecture (Introductory Marketing), your student number and
name at the beginning of your report
 It should be at least 400 words
 Submit your report in Word or PDF format to the “Task submission” site of
Introductory Marketing, UNIVERSAL PASSPORT
 For Questions use email (komiya@em.u-hyogo.ac.jp) or class Q&A, UNIVERSAL
PASSPORT
 Deadline: February 21st (Fri) before midnight
Important perspective: Dual Meaning of
Marketing Reporting
• First Level: Marketing yourself
 Who is the target and competitors?
 How do you differentiate from competitors?
• Second level: Marketing your report
 Target: Komiya
 Competitors: other students in the class
 Differentiate your report from other students' reports
24
Introductory Marketing_14nd
• Differentiating factors when the target is a lecturer
(Komiya)
 Readability of the report
 Paragraphs: Divide sentences by readable length
 Headings: Summarize section contents
4. Course Evaluation Questionnaire
• Please answer the course evaluation questionnaire for
“introductory Marketing” on the Universal Passport
25