Internet Marketing
Inbound vs. Outbound
Marketing
Course Schedule
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The Marketing Function (Lenovo)
Sales & Sales Channels (GolfLogix)
Internet-based Marketing (HubSpot)
R&D: Product Development (Guidant)
Operations (Crocs)
Product Launch (Invisalign)
Final Exam on Product Launch (Emotiv)
Marketing: Learnings
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Elements of the Marketing Mix (C+4P)
Basis of mix decisions: market & financial
objectives and competitive advantage
Importance of product positioning
Positioning factors:
- positioning with? (target customers)
- positioning against? (relevant competitors)
- desires & fears of positioning target
- positioning content (differentiators,benefits)
Promotion (marcomm): communicating to the
marketplace to raise awareness and interest
Sales Channels: Learnings
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The basic sales functions: (promotion), selling,
fulfillment, and service
Channel value-added: Higher and lower valueadded channels; value-added functions
Specific channel options: direct (multiple types),
OEM, integrator, VAR/VAD, distributor,
dealer/retailer, etc
Channel decision criteria: considerations in
matching products, customers, and channels
Channel economics: channel margin, profit
Channel conflict: coordinating multiple channels
HubSpot Case Summary
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Timeframe is 2009
HubSpot was founded in 2006; now has ~1000
customers
Sells “inbound marketing” software that
businesses use in their marketing/promotion
efforts
HubSpot has built its business by (exclusively)
using inbound marketing techniques and its own
products/tools
To grow it’s business further, it faces questions
about which customer segment to target, how to
generate customer interest/contact, and which of
the “interested” customers to pursue…
…and whether to engage in outbound marketing
Mix elements: Promotion
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Branding (creating a company or product
“image”)
Advertising (multiple media; paid and free)
Direct marketing (mail, catalog, telemarketing,
internet)
“Reference” customers (testimonials)
Public relations
Industry relations (trade orgs, industry
analysts,…)
Trade shows and events
Inbound marketing via internet
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Inbound vs. Outbound Marketing
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Outbound (traditional) marketing “pushes”
promotional information about the company and
its products out to customers
- mass and targeted advertising
- trade shows and events
- direct mail, etc
Inbound marketing “pulls” customers and tries to
get them interested enough to contact the
company on their own initiative
-search engines
- blogs
- social media, etc
Assignment Questions
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Which customers should HubSpot target: Owner Ollies
or Marketer Marys? Why?
(see next chart for things to consider in making a decision)
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Does HubSpot have the right set of products for the
chosen target customers? If not, what changes should
they make?
What are the positives-and-negatives of HubSpot’s
software-as-a-service pricing strategy?
What benefits would undertaking some outbound
marketing have for HubSpot? What outcomes, if any,
could outbound marketing deliver better than inbound
marketing?
(see second following chart, AIDA, for some hints)
Selecting Target Customers:
some considerations
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Segment size and revenue opportunity
Customer benefits
Customer interest (incl. current relationships)
Customer ability-to-pay and leverage
Competition/market coverage
Sales issues: sale time/complexity, cost,
channel and associated profit margin
Cost to serve/support
Customer loyalty/lock-in
Customer lifetime value
Strategic value
AIDA Marketing Model
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Attention
capture customer’s attention; create awareness
of the company and/or product
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Interest
create interest in the product’s features,
benefits or value
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Desire
customers want it and/or feel that they need it
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Action
customer takes action; buys the product
Reading for Next Class
Guidant: Cardiac Rhythm
Management Business (A)
Guidant: CRMB in 1997
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Guidant spun-off from Eli Lilly in 1994
Guidant is a medical device company
CRMB is a division of Guidant
CRMB profitable in 1996 (see Exh. 1A,
income statement)
Two product lines:
- pacemakers (brady - for slow heart beat)
- defibrillators (tachy - for fast heart beat)
Guidant case….cont’d
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CRMB is the market share leader (#1)
in tachy
(hint: identify the key factors in their success)
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CRMB is a follower (#4) in brady
Significantly revised their tachy new
product development processes in the
early/mid 90’s
Decision on new R&D initiatives
(additional investment in brady or atrial
fibrillation or congestive heart failure?)
Assignment for Next Class
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List the dozen or more changes Guidant/CRMB
made to its tachy product development process;
which three do you think had the greatest
impact, and why?
Does Guidant/CRMB have the financial resources
to pursue new initiatives?
What objectives (decision criteria) should CRMB
use in making the decision to invest more in its
brady business?
What are the positives-and-negatives of CRMB
devoting additional resources to the “brady”
business in order to improve its brady market
position and financial performance?
(identify at least five of each)
Guidance for Homework
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You will have to speculate which product
development process modifications had
the greatest impact….think about what
would be most influential in getting the
right product to the market quickly and
efficiently
In identifying the positives-and-negatives,
consider market, technology, competitive
and financial aspects