Marketing

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Marketing-notes
Notes and Refe rences N-1
Chapter 1
1. Amy Merrick, “Nordstrom Accelerates
Plans to Straighten Out Business,” The
Wall Street Journal, Oct. 19, 2001,
p. B4; Stanley Holmes, “Can the Nordstroms
Find the Right Style?” Business
Week, July 30, 2001, pp. 59–60.
2. Robert J. Keith, “The Marketing Revolution,”
Journal of Marketing, January
1960, p. 37.
3. Geraldine E. Williams, “High-Performance
Marketing: An Interview with
Nike’s Phil Knight,” Harvard Business
Review, July–August 1992, pp. 91–101.
4. Tony Jackson, “Reflections of a Knowledge
Worker,” Financial Times,
Apr. 27, 1999, p. 12.
5. “The Top 25 Managers,” Business
Week, Jan. 14, 2002, p. 56.
6. The following market-oriented definitions
are extracted from the websites
and publications of the respective companies.
Kodak: We help people share
moments and share lives; Amazon.com:
We make buying the fastest, easiest, and
most enjoyable shopping experience
possible; Hewlett-Packard: We engineer
and deliver technology solutions that
drive business value, create social value,
and improve the lives of our customers;
Nordstrom’s: We offer the customer the
best possible selection, quality, and
value; Caterpillar: We help our customers
build the world’s infrastructure
and transport its resources.
7. Federal Express website: www.fedex.
com, May 2002.
8. Barnes & Noble website: www.
barnesandnoble.com, May 2002.
9. Sonia Reyes, “Pouring On the Sauce
for the Home Team,” BrandWeek,
Feb. 4, 2002, p. 30.
10. Sonya S. Hamilton, “You Don’t Say,”
Sales & Marketing Management, October,
1994, pp. 111–112.
11. Christopher W. Hart and Michael D.
Johnson, “Growing the Trust Relationship,”
Marketing Management, Spring
1999, pp. 9–24; Eric Almquist, Carla
Healon, and Nick Hall, “Making CRM
Make Money,” Marketing Management,
May/June 2002, pp. 16–21.
12. Harley-Davidson website: www.
harleydavidson.com, May 2002.
13. John Deere and Company website:
www.johndeere.com, May 2002.
14. Frederick E. Webster, Jr., “Defining the
New Marketing Concept,” Marketing
Management 2, no. 4 (1993), pp. 22–31.
15. Pai-Wing Tam, “Palm, Seeking Business
Clients, Targets Corporate Executives,”
The Wall Street Journal, May 13,
2002, p. B6.
16. David A. Aaker, Building Strong Brands,
The Free Press, New York 1996.
17. Robert C. Blattberg, Gary Getz, and
Jacquelyn S. Thomas, Customer Equity,
Harvard Business School Press,
Cambridge, MA, 2001.
18. “Business Ethics’ 100 Best Corporate
Citizens,” Business Ethics, March/April
2002, pp. 10–11.
19. Gina Imperator, “New Channels, Old
Values,” Fast Company, October
2000, pp. 364–368; Ron Lieber, “She
Reads Customers’ Minds,” Fast Company,
February 2001, pp. 54–56.
Chapter 2
1. Elizabeth Kaye McCall, “Radio Enters
a New Orbit,” USA Weekend, Jan.
17–19, 2003, p. 14; Earl Eldridge,
“Satellite Radio Transmits Need for
Funds,” USA Today, Aug. 27, 2002,
p. 6B; Mike Drummond, “Wall Street,
We Have a Problem,” Business 2.0,
July 2002, p. 30; Denis Storey, “A Silver
Lining,” Satellite Broadband, January
2002, p. 44; Adam Rogers, “A Little
Space Music,” Newsweek, Nov. 12,
2001, pp. 67–68; Peter Lewis, “Satellite
Radio,” Fortune, Oct. 15, 2001,
pp. 253_; Paige Albiniak, “XM’s
Downer Upper,” Broadcasting & Cable,
Oct. 2, 2001, p. 12; and Bethany
McLean, “Satellite Killed the Radio
Star,” Fortune, Jan. 22, 2001,
pp. 94–96_.
2. A set of “ten trend commandments” is
contained in Laurie Freeman, “Marketers,
Too, Can Keep Ahead of the
Curve,” Marketing News, June 21,
1999, p. 8. Six “waves of change” are
discussed in Steven T. Goldberg, “Trend
Spotting,” Kiplinger’s Personal Finance,
February 2002, pp. 34–39.
3. Ram Subramanian, Nirmala Fernandes,
and Earl Harper, “Environmental Scanning
in U.S. Companies: Their Nature
and Their Relationship to Performance,”
Management International
Review, Vol. 33, No. 3 (1993),
pp. 271–286.
4. Melanie Wells, “Iced Coffee Market
May Get Steamy,” USA Today, Apr. 24,
1996, p. 2B.
5. Bill Brubaker, “Pfizer Buys Rival Pharmacia
for $60 Billion,” Washington
Post, July 16, 2002, p. E1; and Robert
Steyer, “Monsanto Marks the Early
Success of Celebrex,” St. Louis PostDispatch, July 21, 1999, p. C1.
6. U.S. Census Bureau, Statistical Abstract
of the United States: 2000, p. 8, at
www.census.gov/epcd/abstract/
statistical/statistical-abstract-us.html,
accessed July 24, 2002; and Burney
Simpson, “The Future Cardholder,”
Credit Card Management, March 2002,
pp. 36–42.
7. Gary L. Berman, “The Hispanic Market:
Getting Down to Cases,” Sales &
Marketing Management, October 1991,
p. 66.
8. “Ever-Elusive Inflation,” The Economist,
June 19, 1999, p. 24.
9. Margaret Popper, “Inflation’s Gone.
That’s a Good Thing, Right?” Business
Week, Mar. 4, 2002, p. 60. For an essay
that describes price deflation in retailing
and recommends strategies for
coping with deflation, see Walter K.
Levy, “Beware, the Pricing Genie Is out
of the Bottle,” Retailing Issues Letter,
November 1994, pp. 1–4.
10. Molly Prior, “TRU Conversions Almost
Complete,” DSN Retailing Today,
June 24, 2002, pp. 3, 37; and
Monica Roman, “No Fun and Games
at Toys ‘R’ Us,” Business Week,
Feb. 11, 2002, p. 46.
11. James R. Hagerty, “Carpet Makers
Confront Era That Extols Wood
Floors,” The Wall Street Journal, Mar.
31, 1998, p. B1.
12. Joseph B. White, “Honda Will Introduce
Fuel-Cell Cars,” The Wall Street
Journal, July 25, 2002, p. D4; Jacquelyn
Ottman, “Environmental Winners
Show Sustainable Strategies,” Marketing
News, Apr. 27, 1998, p. 6; and
www.reclamere.com/our_services_ recovery.
htm, accessed on July 16, 2002.
13. Geoffrey A. Fowler, “ ‘Green’ Sales
Pitch Isn’t Moving Many Products,”
Notes and References
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N-2 Notes and Refe rences
The Wall Street Journal, Mar. 6, 2002,
pp. B1, B4; and “Laura Litvan, “Going
‘Green’ in the ’90s,” Nation’s Business,
February 1995, p. 31.
14. The contradiction between attitudes
and buying behavior was reported in
C. Mitchell Adrian and Michael D.
Richard, “An Examination of Purchase
Behavior versus Purchase Attitudes for
Environmentally Friendly and Recycled
Consumer Goods,” Southern Business
Review, Spring 1995, pp. 1–15. The
plastic cup example was described in
Stephen Budiansky, “Being Green Isn’t
Always What It Seems,” U.S. News &
World Report, Aug. 26, 1996, p. 42.
15. Peter Stisser, “A Deeper Shade of
Green,” American Demographics,
March 1994, p. 28.
16. Joseph Pereira, “Women Jump ahead
of Men in Purchases of Athletic Shoes,”
The Wall Street Journal, May 26,
1995, p. B1.
17. The statistic regarding working women
comes from John Merli, “Working
Women Use Radio Heavily,” Broadcasting
& Cable, Aug. 3, 1998, p. 34.
The advertising agency study was reported
in Stephanie Thompson, “Spin
City: 18–49 Women,” Brandweek,
May 10, 1999, pp. S16–S18.
18. Thompson, loc. cit.; and Teri Agins,
“Many Women Lose Interest in Clothes,
to Retailers’ Dismay,” The Wall Street
Journal, Feb. 28, 1995, p. A1.
19. Joan O’C. Hamilton, “A Shoe of One’s
Own,” Business Week, May 24, 1999,
pp. 62–64.
20. Maria Mallory, Dan McGraw, and Jill
Jordan Sieder, “Women on a Fast
Track,” U.S. News & World Report,
Nov. 6, 1995, pp. 60_; and Cyndee
Miller, “Study Dispels ’80s Stereotypes
of Women,” Marketing News, May 22,
1995, p. 3.
21. Diane Crispell, “The New World of
Men,” American Demographics, January
1992, pp. 38–43.
22. Greg Wiles, “Internet Sales Grabbing
Bigger Piece of Pie,” National Post,
June 13, 2002, p. FP14; and Lorrie
Grant, “Grocery Chore No More,”
USA Today, July 21, 1999, p. 1B.
23. Vanessa O’Connell, “Campbell Decides
Its IQ Health Meals May Be Ahead of
the Curve for Foods,” The Wall Street
Journal, Apr. 27, 1998, p. B2; and Nikhil
Deogun, “Fat-Free Snacks Aren’t Wowing
Frito Customers,” The Wall Street
Journal, Sept. 12, 1998, pp. B1, B4.
24. Fred Faust, “Smaller Bookstores Challenge
Two Chains,” St. Louis PostDispatch, Mar. 19, 1998, p. B1; and
Bryan Gruley, “Booksellers Sue Random
House on Price Practices,” The
Wall Street Journal, Jan. 15, 1996,
p. B10.
25. Melanie Warner, “Oracle and Siebel’s
Software Hardball,” Fortune, Oct. 16,
2000, pp. 391_.
26. Eldridge, loc. cit.; Rogers, op. cit.;
Lewis, op. cit.; McLean, op cit.; Hiawatha
Bray, “Digital Pay Radio
Seems Wave of the Future,” St. Louis
Post-Dispatch, Dec. 9, 2001, p. F2.
Chapter 3
1. Pat Kiernan and Ali Velshi, “The Money
Gang,” Cable News Network Inc., Dec.
21, 2001; Fara Warner, “Curb Your Enthusiasm,”
Fast Company, January
2002, pp. 32–36; James P. Miller, “Potent
Image Keeps Harley in Hog
Heaven,” Chicago Tribune, Jan. 14,
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Notes and Refe rences N-3
2001, Sec. 5, pp. 1–2; Leslie Gornstein,
“Harley Reaches Crossroads on a
Completely New Ride,” St. Louis PostDispatch, July 14, 2001, p. Biz9;
Jonathan Fahey, “Love into Money,”
Forbes, January 7, 2001, p. 60_.
2. Unless otherwise noted, the demographic
statistics in this chapter come
from Statistical Abstract of the United
Sates: 2001, 121st edition, Bureau of
the Census, Washington, DC, 2001.
3. Michael Porter and Anne Habiby, “A
Window on the New Economy,” Inc.,
May 1999, pp. 48–49.
4. Several family life-cycle models with
marketing implications are compared in
Charles M. Schaninger and William D.
Danko, “A Conceptual and Empirical
Comparison of Alternative Household
Life Cycle Models,” Journal of
Consumer Research, March 1993,
pp. 580–594.
5. Jacob M. Schlesinger, “Working Full
Time Is No Longer Enough,” The Wall
Street Journal, June 29, 2001, pp. A2_.
6. Michael J.Weiss, “Inconspicuous Consumption,”
American Demographics,
April 2002, pp. 30–39.
7. Alison Stein Wellner, “The Census Report,”
American Demographics, January
2002, pp. S3–S6.
8. Ibid., p. S5.
9. Gerry Khermouch and Jeff Green,
“Buzzzz Marketing,” Business Week,
July 30, 2001, pp. 50–56.
10. Richard P. Coleman, “Continuing Significance
of Social Class to Marketing,”
Journal of Consumer Research,
December 1983, pp. 265–280.
11. Rebecca Gardyn, “I’ll Have What He’s
Having,” American Demographics, July
2000, p. 22.
12. James U. McNeal, “Tapping the Three
Kids’ Markets,” American Demographics,
April 1998, pp. 37–41.
13. A. H. Maslow, Motivation and Personality,
Harper and Row, New York,
1954, pp. 80–106. Other motivation
schemes are presented in most basic
psychology texts.
14. Steven Reiss and Susan M. Havercamp,
“Toward a Comprehensive Assessment
of Fundamental Motivation:
Factor Structure of the Reiss Profile,”
Psychological Assessment, June 1998,
pp. 97–106.
15. For more details on sensory perception
see Eric Arnould, Linda Price, and
George Zinkhan, Consumers, McGrawHill/Irwin, Burr Ridge, IL, 2002.
16. Yumiko Ono, “Marketers Seek the
‘Naked’ Truth in Consumers’ Psyches,”
The Wall Street Journal, June
30, 1997, pp. B1_.
17. Glenn Ruffenach, “Fewer Americans
Save for Their Retirement,” The Wall
Street Journal, May 10, 2001, p. A2.
18. Gregory L. White, “Battling the
Inferior–Interior Complex.” The Wall
Street Journal, Dec. 3, 2001, p. B1_.
19. This is the classic definition from Gordon
W. Allport, “Attitudes,” in C. A.
Murchinson, ed., Handbook of Social
Psychology, Clark University Press,
Worcester, MA, 1935, pp. 798–844.
20. Jill Carroll and Shirley Leung, “Fries
with that Burger? Fewer Consumers
Say ‘Yes’,” The Wall Street Journal,
Feb. 20, 2002, pp. B1_.
21. Colleen Bazdarich, “In a Buying Mood?
Maybe It’s the Muzak,” Business 2.0,
March 2002, p. 100.
22. Teresa Dixon Murray, “Slowly Digging
Out,” The Plain Dealer, May 12, 2002,
p. G1. Calmetta Coleman, “Debit
Cards Look to Give Credit Cards a Run
for Consumers’ Money,” The Wall
Street Journal, Dec. 3, 2001, p. B1.
23. “Americans’ Outlook for the Economy:
Neither Best Nor Worst of Times,
New Roper ASW Poll Shows,” Nov.
29, 2001, at www.roper.com.
24. Warner, op. cit.; Gornstein, op. cit.; Fahey,
op. cit.
Chapter 4
1. www.freemarkets.com, accessed Jan. 8,
2002; Stephanie Franken, “Slump Puts
Life into Perspective for PittsburghBased Online Auction Firm,” Pittsburgh
Post-Gazette, Dec. 13, 2001.
2. The statistics on the business market
cited in this chapter come from U.S.
Census Bureau publications. A particularly
useful source is the Statistical Abstract
of the United States, an annual
publication.
3. Wayne Wenzel, “Precision Vision,”
Farm Industry News, July/August 2001,
p. 4_.
4. Several interesting case histories of Internet
B-2-B buyng and selling can be
found on the PurchasePro site, www.
purchasepro.com.
5. George Anders, “Buying Frenzy,” The
Wall Street Journal, July 12, 1999,
pp. R6_.
6. “Diesel Sales Picking Up in American
Light Truck Market,” Navistar news
release dated June 21, 2001, www.
navistar.com.
7. More information on NAICS (pronounced
“Nakes”) is available in
North American Industry Classification
System—United States, 1997, U.S.
Government Printing Office, Washington,
DC, 1997.
8. Al Wrigley, “Maytag Slashing Its Supplier
Base 73%,” American Metal
Market, Sept. 8, 1999, p. 1_.
9. Richard G. Jennings and Richard E.
Plank, “When the Purchasing Agent Is a
Committee: Implications for Industrial
Marketing,” Industrial Marketing Management,
November 1995, pp. 411–419.
10. This section is based on Lawrence A.
Crosby and Sheree L. Johnson, “Technology:
Friend or Foe to Customer Relationships?”
Marketing Management,
November/December 2001, pp. 10–11.
11. Jason Dean and Zach Coleman,
“China Airlines to Move Forward with
Jet Order,” The Wall Street Journal,
June 5, 2002, p. D3.
12. Jeff Bennett, “Measure of the Auto
Industry: Covisint Refines Online Ways
to Connect Buyers and Sellers,” Feb. 19,
2002, from www.auto.com retrieved
from the archives of the Detroit Free
Press (www.detroitfree press.com).
13. www.freemarkets.com, accessed Jan. 8,
2002; Stephanie Franken, op.cit.
Chapter 5
1. www.smart.com website, press release
dated Dec. 10, 2001, entitled “Record
Sales and Revenues for 2001”; Scott
Miller, “Daimler May Roll Out Its Tiny
Car Here,” The Wall Street Journal,
May 9, 2001, p. A21; Jeffrey Ball,
“How Can Detroit Top the SUV?
Think Golf Carts,” The Wall Street
Journal, July 20, 2001, p. B1, B3; Keith
Naughton, “Daimler Thinks Small,”
Newsweek, May 21, 2001, p. 48;
Micheline Maynard, “Get Smart,” Fortune,
Mar. 30, 2001, pp. 48–52; Rhoda
Miel, “Smart Car’s Popularity Gain in
Europe Prompts U.S. Study,” Plastics
News, May 14, 2001, p. 19; Michael
Harvey, “Ultimate City Slicker,” Financial
Times, Nov. 10, 2001; Judy Feldman
et al., “Great Wheels for Every
Drive,” Money, October 2001, p. 146;
Will Pinkston and Scott Miller, “DaimlerChrysler
Nears Way for U.S. Debut
of ‘Smart,’ ” The Wall Street Journal,
Aug. 20, 2001, p. B1.
2. The Hain Food Group 2000 Annual
report, www.thehainfoodgroup.com.
3. Emily Nelson, “Too many Choices,”
The Wall Street Journal, Apr. 20, 2001,
p. B1.
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N-4 Notes and Refe rences
4. Norihiko Shirouzu, “This Is Not Your
Father’s Toyota,” The Wall Street Journal,
Mar. 26, 2002, p. B1.
5. A good description of social class in
marketing can be found in Richard P.
Coleman, “The Continuing Significance
of Social Class in Marketing,”
Journal of Consumer Research, December
1983, pp. 267–280.
6. From the www.polo.com website, June
25, 2002.
7. Paul C. Judge, “Are Tech Buyers Different?”
Business Week, January 26,
1998, pp. 64–68.
8. Rick Brooks, “Alienating Customers
Isn’t Always a Bad Idea, Many Firms
Discover,” The Wall Street Journal,
Jan. 7, 1999, p. A1.
9. Leslie Gornstein, “Harley Reaches
Crossroads on a Completely New Ride,”
St. Louis Post-Dispatch, July 14, 2001,
p. BI29.
10. Devon Spurgeon, “Traditional Grocers
Feel Vindicated by Webvan’s Failure,”
The Wall Street Journal, July 11, 2001,
p. B4.
11. Motoko Rich, “Arnold Helps Choice
Hotels Woo Travelers,” The Wall
Street Journal, May 2, 2001, p. B6.
12. Emily Nelson, “P&G Tries to Hide
Wrinkles in Aging Beauty Fluid,” The
Wall Street Journal, May 16, 2000,
p. B1.
13. Andrew E. Serwer, “McDonald’s Conquers
the World,” Fortune, Oct. 17,
1994, pp. 103–116.
14. Scott Miller, op cit.; Jeffrey Ball, op
cit.; Keith Naughton, op cit.; Micheline
Maynard, op cit.; Rhoda Miel, op cit.;
Michael Harvey, op cit.; Judy Feldman
et al., op cit.; Will Pinkston and Scott
Miller, op cit.
Chapter 6
1. “Factfinder for the Nation,” U.S. Census
Bureau, U.S. Department of Commerce,
Washington, DC, May, 2000,
accessed at www.census.gov/prod/2000
pubs; “Census 2000 in a Flash,” U.S.
Census Bureau, U.S. Department of
Commerce, Washington, DC, undated,
accessed at www.census.gov/dmd/www/
factsheet.html; Alison Stein Wellner,
“The Census Report,” American Demographics,
January 2002, pp. S1–6;
www.census.gov.
2. Jack Honomichl, “The Honomichl
50,” Marketing News, June 10, 2002,
pp. H1_.
3. Jack Honomichl, “A Tough Year,” Marketing
News, June 10, 2002, pp. H3_.
4. Joe Ashbrook Nickell. “Big Data’s Big
Business,” Business 2.Com, Feb. 20,
2001, pp. 62–63.
5. Joe Ashbrook Nickell, “Welcome to
Harrah’s,” Business 2.0, April 2002,
pp. 48–54.
6. In fact, a study of Internet users in the
U.S. found that as of early 2000 the
number of women users exceeded
men, but men still log more hours online.
Brad Reagan, “The Great Divide,”
The Wall Street Journal, Apr. 15,
2002, p. R4.
7. For a dissenting view on the use of
mystery shoppers as a research method,
see Scott Ahlstrand, “Why Spy?”
Gallup Management Journal, Winter
2001, pp. 4–6. Other interesting research
articles can be found at www.
gallupjournal.com.
8. Researchers are constantly looking for
more effective methods for understanding
behavior. For some examples of approaches
being used see Melanie Wells,
“New Ways to Get into Our Heads,”
USA Today, Mar. 2, 1999, pp. 1B_;
Emily Nelson, “Focus Groups: P&G
Keeps Cincinnati Busy with All Its Studies,”
The Wall Street Journal, Jan. 24,
2002, pp. A1_; Suzanne Vranica,
“Some Focus Groups Use Mensa Members,”
The Wall Street Journal, Feb. 21,
2002, p. B6.
9. Johanna Bennett, “It’s My Life,” The
Wall Street Journal, Oct. 29, 2001,
p. R9.
10. An experiment comparing the relative
effectiveness of mail, fax, e-mail, and
the Web for collecting survey data is reported
in Rick Weible and John Wallace,
“Cyber Research,” Marketing
Research, Fall 1998, pp. 19–24.
11. Adam L. Penenberg, “Is There Snooping
on Your Sites?” Forbes, May 17,
1999, pp. 322–325.
12. www.claritas.com, accessed on Feb. 6,
2002; Deborah D. McManus, “MicroMarketing,” Broadcasting & Cable,
July 17, 2000, p. 50.
Chapter 7
1. Paul Saffo, “Ginger’s Next Trick,”
Business 2.0, February 2002, p. 24;
Paul Somerson, “It’s Alive! It’s Not a
Personal Hovercraft Or a HydrogenPowered Teleporter. But You’ll Want
One,” Smart Business for the New
Economy, Jan. 1, 2002, p. 21; Dan
Gillmore, “Segway Transporter May
Scoot Us into a Brave New World,” St.
Louis Post-Dispatch, Dec. 24, 2001,
p. BP 11; John Heilemann, “Reinventing
the Wheel,” Time, Dec. 10, 2001,
pp. 76_.; Jim Krane, “IT’s Hip, IT’s
Hot, IT’s New—What Is IT?” St. Louis
Post-Dispatch, Dec. 4, 2001, p. A1;
and Karl Greenberg, “The ‘IT’ Girl,”
Brandweek, Nov. 12, 2001 p. 37.
2. Bruce Horovitz, “Fast-Food Giants
Hunt for New Products to Tempt Consumers,”
USA Today, July 3–4, 2002,
pp. 1A, 2A.
3. For a different classification scheme
that provides strategic guidelines for
management by relating products and
prices, see Patrick E. Murphy and
Ben M. Enis, “Classifying Products
Strategically,” Journal of Marketing,
July 1986, pp. 24–42. Also see Ernest F.
Cooke, “The Relationship between a
Product Classification System and Marketing
Strategy,” Journal of Midwest
Marketing, Spring 1987, pp. 230–240.
4. Christine Bittar, “Kimberly-Clark Adds
Cheeky Exposure to Ms. Cottonelle
Toilet Paper Rollout,” Brandweek,
May 7, 2001, p. 8.
5. Kathleen Deveny, “Failure of Its Oven
Lovin’ Cookie Dough Shows Pillsbury
Pitfall of New Products,” The Wall
Street Journal, June 17, 1993, p. B1.
6. Vanessa O’Connell and Joe White, “After
Decades of Brand Bodywork, GM
Parks Oldsmobile—for Good,” The
Wall Street Journal, Dec. 13, 2000,
pp. B1, B4; and Stuart Elliott, “The Famous
Brands on Death Row,” The New
York Times, Nov. 7, 1993, p. 1F.
7. Barton G. Tretheway, “Everything
New Is Old Again,” Marketing Management,
Spring 1998, p. 7.
8. Durk Jager, as quoted in Katrina
Brooker, “Can Procter & Gamble
Change Its Culture, Protect Its Market
Share, and Find the Next Tide?”
Fortune, Apr. 26, 1999, p. 149. Also
see Amy Merrick, “Too Much of a
Good Thing?” The Wall Street Journal,
July 24, 2002, pp. B1, B3; Nanette
Byrnes, “Brands in a Bind,” Business
Week, Aug. 28, 2000, pp. 234–236_;
and Geoffrey Colvin, “How Rubbermaid
Managed to Fail,” Fortune,
Nov. 23, 1998, pp. 32–33.
9. Respectively, Cliff Edwards, “Where
Have All the Edsels Gone?” Pittsburgh
Post-Gazette, May 25, 1999, p. F-7;
Tretheway, loc. cit.; and Kuczmarski &
Associates, as described in Christopher
Power, “Flops,” Business Week,
Aug. 16, 1993, pp. 76–77.
10. The reasons for failure are drawn
from the “1995 Innovation Survey,”
conducted by Group EFO Limited of
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Notes and Refe rences N-5
Weston, CT. The examples are drawn
from Heather Pauly, “Flipping over
Flops,” Chicago Sun-Times, June 29,
1998, p. 43; and Alan Farnham, “It’s
a Bird! It’s a Plane! It’s a Flop!” Fortune,
May 2, 1994, pp. 108–110.
11. Paul Lukas, “The Ghastliest Product
Launches,” Fortune, Mar. 16, 1998,
p. 44.
12. Jerry Useem, “Sold! Elvis Impersonator
for $61.23 an Hour,” Fortune,
Aug. 16, 1999, p. 36.
13. John Simons, “Greed Meets Terror,”
Fortune, Oct. 29, 2001, pp. 145–146.
14. Evan Ramstad, “Products Go Digital
. . .Whether They Are or Not,” The
Wall Street Journal, Sept. 7, 1999,
p. A11A.
15. Kenneth Cole, “Electric Cars Unlikely
to Take Center Stage,” The Detroit
News, Dec. 21, 1998, p. F15.
16. As stressed by a consultant, Philip
Himmelfarb, in Roberta Maynard,
“The Heat Is On,” Nation’s Business,
October 1997, pp. 16, 18.
17. These benefits and a “stage gate system”
for new-product development are
described in Robert G. Cooper and
Elko J. Kleinschmidt, “Stage Gate Systems
for New Product Success,” Marketing
Management, Vol. 1, No. 4,
1993, pp. 20–29. For an approach for
managing multiple new-product development
projects, see Steven C. Wheelwright
and Kim B. Clark, “Creating
Project Plans to Focus Product Development,”
Harvard Business Review,
March–April 1992, pp. 70–82.
18. For a report on the criteria used in making
“go–no go” decisions in the productdevelopment process, see Ilkka A.
Ronkainen, “Criteria Changes across
Product Development Stages,” Industrial
Marketing Management, August
1985, pp. 171–178.
19. The information about customers, suppliers,
and franchisees comes, respectively,
from “Study: Launching New
Products Is Worth the Risk,” Marketing
News, Jan. 20, 1992, p. 2; Neal Templin
and Jeff Cole, “Manufacturers Use Suppliers
to Help Them Develop New Products,”
The Wall Street Journal, Dec. 19,
1994, pp. A1, A6; and Jeffrey A. Tannenbaum,
“Role Model,” The Wall
Street Journal, May 23, 1996, p. R22.
20. For more on the first two stages,
termed opportunity identification, see
Linda Rochford, “Generating and
Screening New Product Ideas,” Industrial
Marketing Management, November
1991, pp. 287–296.
21. Faye Rice, “Secrets of Product Testing,”
Fortune, Nov. 29, 1994, pp. 166–171.
22. Jennifer Lach, “Meet You in Aisle
Three,” American Demographics, April
1999, pp. 41–42.
23. Cooper and Kleinschmidt, op. cit.,
pp. 22–23.
24. Development times are discussed in
Pamela Buxton, “Time to Market
Is NPD’s Top Priority,” Marketing,
Mar. 30, 2000, p. 35. For an in-depth
look at the development of the Frito
Pie, see Emily Nelson, “Product Development
Is Always Difficult; Consider
the Frito Pie,” The Wall Street Journal,
Oct. 25, 1999, pp. A1, A22. For insight
into one automaker’s efforts to develop
and bring new models to market more
quickly, see David Welch, “Look Who’s
Finally Stopping Traffic,” Business
Week, Feb. 28, 2000, p. 38. The omission
of market tests was described in
“Study: Launching New Products Is
Worth the Risk,” loc. cit.
25. Robert G. Cooper and Scott J. Edgett,
“Critical Success Factors for New Financial
Services,” Marketing Management,
Fall 1996, pp. 26–37; and
Howard Schlossberg, “Services Development
Lags Behind New Products,”
Marketing News, Nov. 6, 1989, p. 2.
26. For foundations of diffusion theory
and a review of landmark studies on
diffusion of innovation, see Everett M.
Rogers, Diffusion of Innovations, 3d
ed., Free Press, New York, 1983.
27. Robert A. Guth and Khanh T. L. Tran,
“The Geeks’ Secret: Buying Gadgets
Direct from Japan,” The Wall Street
Journal, Sept. 4, 2002, pp. D1, D4.
28. “GPS Offers Security,” Columbia
Daily Tribune, Aug. 25, 2002, p. 13A.
29. Denise Smith Amos, “Are You an ‘Influential’?
Advertisers Want You,” St.
Louis Post-Dispatch, Aug. 6, 1995,
pp. E1, E9.
30. Rogers, loc. cit.
31. Tara Parker-Pope, “P&G Puts Two
Cleaning Products on Its New Marketing
Fast Track,” The Wall Street Journal,
May 18, 1999, p. B6; and Yumiko
Ono, “Novel P&G Product Brings Dry
Cleaning Home,” The Wall Street Journal,
Nov. 19, 1997, p. B1.
32. The quote about brand managers being
an “endangered species” is drawn from
Rance Crain, “Brand Management’s
Decline May Haunt GM,” Advertising
Age, Nov. 6, 1995, p. 16. The shifting
arrangements are reported in David
Welch, “GM Brand Managers Get the
Boot,” Business Week, Apr. 22, 2002,
p. 14; Jolie Solomon and Carol Hymowitz,
“P&G Makes Changes in the
Way It Develops and Sells Its Products,”
The Wall Street Journal, Aug. 11, 1987,
pp. 1, 12; and Raymond Serafin, “Ford
Taps Insiders as Brand Managers,” Advertising
Age, Jan. 1, 1996, p. 3.
33. Various arrangements are discussed in
Eric M. Olson, Orville C. Walker, Jr.,
and Robert W. Ruekert, “Organizing for
Effective New Product Development:
The Moderating Role of Product Innovativeness,”
Journal of Marketing, January
1995, pp. 48–62. The favorable
comment comes from Steve McDougal
and Jeff Smith, “Wake Up Your Product
Development,” Marketing Management,
Summer 1999, pp. 24–30.
34. Robert M. Metcalfe, “From the Ether,”
InfoWorld, Nov. 22, 1999, p. 90; “Johnson
& Johnson Develops Wheelchair
That Can Climb Stairs,” St. Louis PostDispatch, July 3, 1999, p. 26OT; Heilemann,
loc. cit.; and www.indetech.com/
ibot/index.html, accessed on Feb. 16,
2002.
Chapter 8
1. “Palm, in Shift, Offers Refund on
Flawed Device,” The Wall Street Journal,
Sept. 5, 2002, p. D5; Pui-Wing Tam,
“Hand-Held Device Sales Rise 25%, but
Growth Rate Trails Past Years,” The
Wall Street Journal, Jan. 31, 2002,
p. B9; Erik Sherman, “The 2nd Time
Around,” Newsweek, Nov. 5, 2001,
p. 40L; Pui-Wing Tam, “How Palm
Tumbled from Star of Tech to Target of
Microsoft,” The Wall Street Journal,
Sept. 7, 2001, pp. A1–A4; Tobi Elkin,
“Palm Gets Slapped,” Advertising Age,
Sept. 3, 2001, p. 6; Janet Rae-Dupree,
“Hand-Held Computers Get Second
Life with New Features,” U.S. News &
World Report, June 18, 2001, p. 48;
John Simons, “Has Palm Lost Its Grip?”
Fortune, May 28, 2001, pp. 104–108;
and Cliff Edwards, “No Cartwheels for
Handspring,” Business Week, Apr. 2,
2001, pp. 56–58.
2. Christopher Lawton, “Anheuser Tries
Low-Carb Beer to Tap Diet Buzz,” The
Wall Street Journal, Sept. 13, 2002,
pp. B1, B2.
3. Kathleen Kerwin and Keith Naughton,
“A Different Kind of Saturn,” Business
Week, July 5, 1999, pp. 28–29, and
Russell Mitchell, “Intel Isn’t Taking
This Lying Down,” Business Week,
Sept. 30, 1991, pp. 32–33.
4. Michael Goldstein, “Few Leagues of
Their Own,” Business Week, Jan. 18,
1999, pp. 74–76.
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N-6 Notes and Refe rences
5. Cynthia Wilson, “Discount Airlines Fly
High,” St. Louis Post-Dispatch, Sept.
8, 2002, pp. F1, F10. For more on positioning
in relation to a competitor, see
Jack Trout and Al Ries, “Don’t Follow
the Leader,” Sales & Marketing Management,
February 1994, pp. 25–26.
6. Laura Bird, “Romancing the Package,”
Adweek’s Marketing Week, Jan.
21, 1991, pp. 10–11, 14.
7. “J. M. Smucker Acquires Jif, Crisco
Brands from P&G,” Nation’s Restaurant
News, Oct. 29, 2001, p. 100.
8. James R. Hagerty, “Gilding the Drill
Bit? Hardware Giants Go High-End,”
The Wall Street Journal, July 28, 1998,
pp. B1, B7.
9. Bianca Riemer and Laura Zinn, “Haute
Couture That’s Not So Haute,” Business
Week, Apr. 22, 1991, p. 108.
10. Louise Lee, “Williams-Sonoma Tries a
New Recipe,” Business Week, May 6,
2002, p. 36; and Lee Gomes, “H-P to
Create a New Subsidiary to Sell Cheap
‘Apollo’ Brand of Ink-Jet Printers,”
Jan. 6, 1999, p. B4.
11. Hagerty, loc. cit.
12. William C. Symonds, “Would You
Spend $1.50 for a Razor Blade?” Business
Week, Apr. 27, 1998, p. 46; and
Mark Maremont, “Gillette Finally Reveals
Its Vision of the Future, and It
Has 3 Blades,” The Wall Street Journal,
Apr. 14, 1998, p. A1, A10.
13. Dean Takahashi, “Intel to Unveil
Speedier Chips on Monday,” The Wall
Street Journal, Oct. 22, 1999, p. B6;
and Andy Reinhardt, “Intel Is Taking
No Prisoners,” Business Week, July
12, 1999, p. 38.
14. The criticisms are summarized in Geoffrey
L. Gordon, Roger J. Calantone,
and C. Anthony diBenedetto, “Mature
Markets and Revitalization Strategies:
An American Fable,” Business Horizons,
May–June 1991, pp. 39–50. Alternative
life cycles are proposed in Edward
D. Popper and Bruce D. Buskirk,
“Technology Life Cycles in Industrial
Markets,” Industrial Marketing Management,
February 1992, pp. 23–31;
and C. Merle Crawford, “Business
Took the Wrong Life Cycle from Biology,”
The Journal of Product & Brand
Management,Winter 1992, pp. 51–57.
15. Elliot Spagat, “Hit Show of the Season:
The Revival of Digital TV,” The Wall
Street Journal, Aug. 1, 2002, pp. D1, D3.
16. Neil Gross and Peter Coy, “The Technology
Paradox,” Business Week,
Mar. 6, 1995, p. 77.
17. Michael Booth, “Olestra, Where Art
Thou?” Denver Post, Mar. 19, 2002,
p. F-1.
18. Emily Nelson, “In a Rainbow of Hues,
Bracelets Bring a Pot of Gold,” The
Wall Street Journal, Dec. 6, 1999,
pp. B1, B4.
19. Eric Adler, “The Walkman at 20:
Portable Stereo Has Changed the
World,” St. Louis Post-Dispatch, Sept. 2,
1999, p. G1.
20. The examples in this paragraph and the
following one are drawn from “After
the Compact Disc,” FT.com, May 8,
2002; and Sarah Bryan Miller, “In
Home Tech, ‘Permanent Investments’
Have a Short Life Span,” St. Louis PostDispatch, July 7, 2002, pp. F1, F13.
21. Brian Steinberg, “Starbucks, Pepsi
Hope Ad Blitz Will Rouse Bottled-Coffee
Market,” The Wall Street Journal,
June 19, 2002, p. B6D.
22. Kevin Maney, “Impregnable ‘First
Mover Advantage’ Philosophy Suddenly
Isn’t,” USA Today, July 18, 2001,
p. 3B. For a discussion of three ways in
which pioneers can be “dumb movers,”
see Gary Hamel, “Smart Mover, Dumb
Mover,” Fortune, Sept. 3, 2001,
pp. 191–192_.
23. The concept of “pioneer advantage”
and the historical study of the 50 product
categories are described in Gerard J.
Tellis and Peter N. Golder, “Pioneer Advantage:
Marketing Logic or Marketing
Legend,” USC Business, Fall/Winter
1995, pp. 49–53.
24. Reiji Yoshida, “Sega Plays Survival
Game with Dreamcast,” Japan Times
Weekly International Edition, Dec.
14–20, 1998, p. 13.
25. Ten distinct strategies are described in
Joel R. Evans and Gregg Lombardo,
“Marketing Strategies for Mature
Brands,” Journal of Product & Brand
Management, vol. 2, no. 1, 1993,
pp. 5–19. For a discussion of four
strategies—recapture, redesign, refocus,
and recast—that are particularly
applicable to business products, see
Paul C. N. Michell, Peter Quinn, and
Edward Percival, “Marketing Strategies
for Mature Industrial Products,”
Industrial Marketing Management,
August 1991, pp. 201–206.
26. Jeannine Aversa, “U.S. Mint Is Looking
for a Little Change,” St. Louis
Post-Dispatch, Sept. 10, 2002, p. C1;
and Martha Brannigan, “Cruise Lines
Look to the Land to Get Boomers on
Board,” The Wall Street Journal, Dec. 6,
1999, p. B4.
27. Sandra Dolbow, “Meet Lycra’s New
Face,” Brandweek, Apr. 24, 2000,
pp. 1, 89; Becky Ebenkamp, “Lycra
Streeetches,” Brandweek, July 5, 1999,
p. 3; and Monica Roman, “How Du
Pont Keeps ’Em Coming Back for
More,” Business Week, Aug. 20,
1990, p. 68.
28. Dana James, “Rejuvenating Mature
Brands Can Be Stimulating Exercise,”
Marketing News, Aug. 16, 1999, p. 16.
29. Hardy Green, “The Last Word in New
Words,” Business Week, Aug. 30,
1999, p. 6.
30. Bill Saporito, “How to Revive a Fading
Firm,” Fortune, Mar. 22, 1993, p. 80.
31. Joel Dreyfuss, “Planned Obsolescence
Is Alive and Well,” Fortune, Feb. 15,
1999, p. 192[P].
32. Lauren Goldstein, “Urban Wear Goes
Suburban,” Fortune, Dec. 21, 1998,
pp. 169–170_.
33. For an example of producing multiple
variations of a style, see Riemer and
Zinn, loc. cit.
34. Suzanne Smalley, “An Aggressive New
Cut,” Newsweek, June 10, 2002,
p. 37; Wendy Bounds, Rebecca Quick,
and Emily Nelson, “In the Office, It’s
Anything Goes,” The Wall Street Journal,
Aug. 26, 1999, pp. B1, B4; Teri
Agins, “The Fall of the Jacket Leaves
Retailers Torn over Fashion’s Future,”
The Wall Street Journal, Aug. 26,
1999, pp. A1, A6; and Teri Agins,
“Many Women Lose Interest in
Clothes, to Retailers’ Dismay,” The
Wall Street Journal, Feb. 28, 1995,
pp. A1, A8.
35. Veronica Chambers and Alisha Davis,
“Direct from Paris . . . to the Mall,”
Newsweek, Apr. 13, 1998, pp. 64–65.
36. Mark Boslet, “Palm, Faltering, Hopes
for Boost from New Gadgets,” The
Wall Street Journal, July 24, 2002,
p. D5; Pui-Wing Tam, “For Palm,
Splitting in Two Isn’t Seamless,” The
Wall Street Journal, June 27, 2002,
p. B4; Pui-Wing Tam, “Palm to Speed
Launch of System Upgrade,” The Wall
Street Journal, Feb. 5, 2002, p. B6;
Walter S. Mossberg, “Palm’s New
Hand-Held Goes Mano a Mano with a
BlackBerry,” The Wall Street Journal,
Jan. 31, 2002, p. B1; and Pui-Wing
Tam, “Handspring Plans Line of Hybrid
Devices,” The Wall Street Journal,
Oct. 15, 2001, p. B7.
Chapter 9
1. Jonathan Reynolds, “Licensed to Grill,”
The New York Times, Aug. 18, 2002,
etz26505_notes.qxd 4/16/03 12:55 PM Page N-6
Notes and Refe rences N-7
pp. 90_; www.saltoninc.com, accessed
on Mar. 6, 2002; Salton, Inc.,
2002 annual report; Shirley Leung,
“Grill Sales Slow but Big Payouts Flow
to Foreman,” The Wall Street Journal,
Feb. 2, 2001, pp. B1, B4; Thyra Porter,
“Salton Supports Growth,” HFN, Jan.
17, 2000, p. 64; Roy S. Johnson, “Why
Retired Sports Pros Make the Best
Hucksters,” Fortune, Feb. 21, 2000,
pp. 60–62; and “A Brand New Pitch,”
Industry Week, Mar. 6, 2000,
pp. 41–44.
2. Adapted from Peter D. Bennett, ed.,
Dictionary of Marketing Terms, American
Marketing Association, Chicago,
1988, p. 18. The incorrect usage is
pointed out in John F. Gaski, “Some
Troublesome Definitions of Elementary
Marketing Concepts—Have You
Ever Looked at It This Way?” in D. W.
Stewart and N. J. Vilcassim, eds., 1995
AMA Winter Educators’ Conference:
Marketing Theory and Applications,
American Marketing Association,
Chicago, 1995, pp. 425–429.
3. The European procedure is described in
Maxine Lans Retsky, “Who Needs the
New Community Trademark?” Marketing
News, June 3, 1996, p. 11. For a
description of changes in trademark
law and court decisions on trademarks
as well as their marketing implications,
see Dorothy Cohen, “Trademark Strategy
Revisited,” Journal of Marketing,
July 1991, pp. 46–59.
4. “Wrestling Federation Puts the Tag on a
New Name,” Brandweek, May 13,
2002, p. 16; and “Settlement Reached
in Gateway Trademark Lawsuit,” Associated
Press Newswires, June 20, 2001.
5. Rodney Ho, “Brand-Name Diamonds:
A Cut Above?” The Wall Street Journal,
June 1, 1998, p. B1; and Betsy
Morris, “The Brand’s the Thing,” Fortune,
Mar. 4, 1996, pp. 72–75_.
6. Arlene Weintraub, “Can Nestlé Resist
This Morsel?” Business Week, Sept. 2,
2002, pp. 60, 62; and Thomas Kamm,
“Rivalry in Luxury Goods Heats Up
as Gucci and LVMH Unveil Deals,”
The Wall Street Journal, Nov. 16,
1999, p. A22.
7. Al Ries, “What’s in a Name?” Sales &
Marketing Management, October 1995,
p. 36. This article also discusses eight attributes
of a desirable brand name.
8. Material in this paragraph and the following
one are drawn from Suein L.
Hwang, “Picking Pithy Names Is Getting
Trickier as Trademark Applications
Proliferate,” The Wall Street
Journal, Jan. 14, 1992, p. B1.
9. For more about morphemes, see Teresa
Pavia and Janeen A. Costa, “The Winning
Number: Consumer Perceptions of
Alpha-Numeric Brand Names,” Journal
of Marketing, July 1993, pp. 85–98;
and Casey McCabe, “What’s in a
Name?” Adweek’s Marketing Week,
Apr. 16, 1990, p. 22.
10. See also Kim Robertson, “Strategically
Desirable Brand Name Characteristics,”
The Journal of Product &
Brand Management, Summer 1992,
pp. 62–72. For a good discussion of
the special opportunities and challenges
associated with services branding,
see Vicki Clift, “Name Service
Firms for the Long Haul,” Marketing
News, Dec. 6, 1993, p. 10. Some of
the examples in this section are drawn
from Leonard L. Berry, Edwin F.
Lefkowith, and Terry Clark, “In Services,
What’s in a Name?” Harvard
Business Review, September–October
1988, pp. 28–30.
11. “Largest Counterfeit Software Seizure in
U.S. History,” PR Newswire, Nov. 16,
2001; and David Stipp, “Farewell, My
Logo,” Fortune, May 27, 1996, p. 130.
12. Geoffrey A. Fowler, “Copies ‘R’ Us,”
The Wall Street Journal, Jan. 31, 2003,
pp. B1, B4. Alkman Granitsas, “Studios
Offer Bounty in Piracy War,” The
Wall Street Journal, July 10, 2002,
p. B4; and Russell E. Brooks and Gila
E. Gellman, “Combating Counterfeiting,”
Marketing Management, vol. 2,
no. 3, 1993, pp. 49–51.
13. An excellent summary of this challenge
and a list of safeguards are contained
in Maxine S. Lans, “On Your Mark:
Get Set or It May Go,” Marketing
News, Sept. 26, 1994, p. 12.
14. Jack Alexander, “What’s in a Name?
Too Much, Said the FTC,” Sales &
Marketing Management, January 1989,
pp. 75, 78.
15. Carrie Goerne, “Rollerblade Reminds
Everyone That Its Success Is Not
Generic,” Marketing News, Mar. 2,
1992, p. 1.
16. Patricia Sellers, “Brands: It’s Thrive or
Die,” Fortune, Aug. 23, 1993, p. 53.
17. For an excellent discussion of the nature
and benefits of this strategy, see
Donald G. Norris, “Ingredient Branding:
A Strategy Option with Multiple
Beneficiaries,” Journal of Consumer
Marketing, Summer 1992, pp. 19–31.
18. Jeff Green, “Hold On—What Make of
Alternator Is That?” Business Week,
Nov. 13, 2000, pp. 203–204; and Morris,
op. cit., p. 82.
19. Anne D’Innocenzio, “Big Retailers Steer
Brand-Name Makers to Private Labels,”
St. Louis Post-Dispatch, June 2,
2002, p. E8.
20. Greg Burns, “A Froot Loop by Any
Other Name,” Business Week, June 26,
1995, p. 72.
21. The study was conducted by Raj Sethuraman
of the University of Iowa, and
reported in Richard Gibson, “StoreBrand Pricing Has to Be Just Right,”
The Wall Street Journal, Feb. 14, 1992,
p. B1. The second study was summarized
in Stephen J. Hoch, “Private Label
a Threat? Don’t Believe It,” Advertising
Age, May 24, 1993, p. 19.
22. Wal-Mart’s approach is summarized
in Peter Galuszka and Wendy Zellner,
“Soap Opera at Wal-Mart,” Business
Week, Aug. 16, 1999, p. 44. The
other examples come from Clyde H.
Farnsworth, “Quality: High. Price:
Low. Big Ad Budget? Never,” The New
York Times, Feb. 6, 1994, p. F10.
23. The estimated share of store brands in
several types of retail stores is from the
Store Brands Today page on the Private
Label Manufacturers Association website,
www.plma.com, accessed on July
23, 2002. The proportion of retailers
intending to place more emphasis on
such products come from Susan Zimmerman,
“A Rosy Future,” Progressive
Grocer, November 1998, pp. 45–52.
The $100 billion forecast was made by
Destination Products International, as
reported in Stephanie Thompson, “The
New Private Enterprise,” Brandweek,
May 3, 1999, pp. 36_. The estimate of
volume in 1995 is based on statistics in
Emily DeNitto, “Back into Focus,”
Brandweek, May 29, 1995, pp. 22–26.
24. Recommendations as to how manufacturers
can sustain their brands are
presented in Susan R. Ashley, “How to
Effectively Compete against PrivateLabel Brands,” Journal of Advertising
Research, January–February 1998,
pp. 75_. The examples of price cutting
are drawn from Gabriella Stern,
“As National Brands Chop Prices,
Stores Scramble to Defend PrivateLabel Goods,” The Wall Street Journal,
Aug. 23, 1993, p. B1.
25. Scheherazade Daneshkhu, “Awareness
Becomes the Name of the Game,”
Financial Times, Sept. 9, 1999, p. II;
and Paul Beckett and Suzanne Vranica,
“Citigroup Spotlights Its Member
Brands,” The Wall Street Journal,
June 25, 1999, p. B2.
26. There are potential disadvantages as
well as advantages to introducing new
etz26505_notes.qxd 4/16/03 12:55 PM Page N-7
N-8 Notes and Refe rences
products under the family brand. For
more on this, see Barbara Loken and
Deborah Roedder John, “Diluting Brand
Beliefs: When Do Brand Extensions
Have a Negative Impact?” Journal of
Marketing, July 1993, pp. 71–84.
27. Norton Paley, “Back from the Dead,”
Sales & Marketing Management, July
1995, pp. 30_.
28. D. C. Denison, “Ingredient Branding
Puts Big Names in the Mix,” The
Boston Globe, May 26, 2002, p. E2;
and Kara LaGrassa, “Entrepreneur of
the Year: Sidney Feltenstein, Franchising
World, Mar. 1, 2001, pp. 8–9.
29. This definition is drawn from the
comprehensive examination of brand
equity in Peter H. Farquhar, “Managing
Brand Equity,” Journal of Advertising
Research, August/September
1990, pp. RC-7–RC-12. For more on
brand equity, see David A. Aaker and
Erich Joachimsthaler, Brand Leadership,
The Free Press, New York, 2000;
and Don E. Schultz, “Understanding
and Measuring Brand Equity,” Marketing
Management, Spring 2000, pp. 8–9.
30. Deborah L. Vance, “A Name You Can
Trust,” Marketing News, Sept. 16, 2002,
p. 3; “Sony Retains #1 Position in the
Harris Poll Annual ‘Best Brand’ Survey
for Third Year in a Row,” PR Newswire,
July 17, 2002; and Gerry Khermouch,
“The Best Global Brands,” Business
Week, Aug. 5, 2002, pp. 92–96_.
31. The quote is from Roger Baird, “Asset
Tests,” Marketing Week, Oct. 1, 1998,
pp. 28–31.
32. The Kellogg’s example was described
by Farquhar, “Managing Brand Equity,”
op. cit., p. RC-7. The study of
personal computers was summarized in
Jim Carlton, “Marketing Plays a Bigger
Role in Distributing PCs,” The Wall
Street Journal, Oct. 16, 1995, p. B4.
33. David Welch, “Firestone: Is This Brand
Beyond Repair?” Business Week, June
11, 2001, p. 48; and Christopher Carey,
“TWA Boasts Best On-Time Record,”
St. Louis Post-Dispatch, Oct. 7, 1999,
p. C2.
34. Farquhar, “Managing Brand Equity,”
op. cit., pp. RC-8–RC-10.
35. Morris, op. cit., p. 84.
36. The efforts of Oil of Olay to capitalize
on its strong brand equity by introducing
a new line are described in
Tara Parker-Pope, “P&G’s Cosmetics
Makeover,” The Wall Street Journal,
Apr. 12, 1999, pp. B1, B3. For more
on the rationale for the Marquis by
Waterford line, see Judith Valente, “A
New Brand Restores Sparkle to Waterford,”
The Wall Street Journal,
Nov. 10, 1994, p. B1.
37. Statistics in this paragraph come from
“Hot Movies Boost Licensing Industry’s
Hopes for Better Year,” Columbia
Daily Tribune, June 12, 2002, p. 7B.
Other material is drawn from “Fashion
Plays in Licensing,” Discount Store
News, June 7, 1999, pp. A6–A7.
38. Gerry Khermouch, “‘Whoa, Cool
Shirt.’ ‘Yeah, It’s a Pepsi,’ ” Business
Week, Sept. 10, 2001, p. 84.
39. Dale D. Buss, “Hot Names, Top Dollars,”
Nation’s Business, August 1995,
p. 17.
40. Eliot Schreiber, “Retail Trends Shorten
Life of Package Design,” Marketing
News, Dec. 5, 1994, p. 7.
41. Raju Narisetti, “Plotting to Get Tissues
into Living Rooms,” The Wall Street
Journal, May 3, 1996, pp. B1, B12.
42. Betsy McKay, “Thinking inside the Box
Helps Soda Makers Boost Sales,” The
Wall Street Journal, Aug. 2, 2002,
pp. B1, B4; and Paul Lukas, “If It Ain’t
Got Glass, It Ain’t Got Class,” Fortune,
Apr. 12, 1999, p. 40. For recommendations
on managing the packaging aspect
of a company’s marketing mix, see
Richard T. Hise and James U. McNeal,
“Effective Packaging Management,”
Business Horizons, January–February
1988, pp. 47–51.
43. For further discussion of packagedesign
strategies that can boost sales
and profit, see Sue Bassin, “Innovative
Packaging Strategies,” Journal of Business
Strategy, January–February 1988,
pp. 38–42.
44. Schreiber, loc. cit.
45. David Leonhardt, “The Hip New
Drink: Milk,” Business Week, Feb. 16,
1998, p. 44.
46. Laura Bird, “Romancing the Package,”
Adweek’s Marketing Week, Jan. 21,
1991, p. 10.
47. Information about the National Labeling
and Education Act is drawn from
the Food and Drug Administration
website: http://vm.cfsan.fda.gov/,dms/
fdnewlab.html.
48. John Sinisi, “New Rules Exact a Heavy
Price as Labels Are Recast,” Brandweek,
Dec. 7, 1992, p. 3. For a study that examines
the impact of the NLEA on consumers’
processing of nutrition information,
see Christine Moorman, “A Quasi
Experiment to Assess the Consumer and
Informational Determinants of Nutrition
Information Processing Activities:
The Case of the Nutrition Labeling
and Education Act,” Journal of Public
Policy & Marketing, Spring 1996,
pp. 28–44. This issue of the journal contains
several other articles examining
various aspects of nutrition labeling.
49. Eleena de Lisser, “Is That $5 Gallon of
Milk Really Organic?” The Wall Street
Journal, Aug. 20, 2002, pp. D1, D4.
50. Laura M. Litvan, “Sizing Up Metric
Labeling Rules,” Nation’s Business,
November 1994, p. 62.
51. Bruce Nussbaum, “Is In-House Design
on the Way Out?” Business Week,
Sept., 1995, p. 130. For an overview of
how Ikea, the Swedish-based furniture
retailer, has made design an integral
part of its marketing program, see Lisa
Margonelli, “How Ikea Designs Its
Sexy Price Tags,” Business 2.0, October
2002, pp. 106–112.
52. Bruce Nussbaum, “The Best Product
Designs of the Year: Winners 2002,”
Business Week, July 8, 2002,
pp. 82–89_.
53. “Over 60 and Overlooked—Why Does
Business Ignore Older Customers?” The
Economist, Aug. 10, 2002, no page
given; “Business Bulletin,” The Wall
Street Journal, July 13, 2000, p. A1; and
Bruce Nussbaum, “What Works for
One Works for All,” Business Week,
Apr. 20, 1992, pp. 112–113.
54. The Beetle’s comeback was described
in Paul Tharp, “VW’s Hippie Bus Now
for Yuppies,” New York Post, June 12,
2002, p. 37; and Bill Vlasic, “Bug-Eyed
over the New Beetle,” Business Week,
May 25, 1998, p. 88. The figure pertaining
to cost of design comes from
Brian Dumaine, “Design That Sells and
Sells and . . . ,” Fortune, Mar. 11, 1991,
pp. 86, 88.
55. Nancy Arnott, “Shades of Distinction,”
Sales & Marketing Management, June
1995, p. 20; Paul M. Barrett, “Color in
the Court: Can Tints Be Trademarked?”
The Wall Street Journal, Jan. 5, 1995,
p. B1; and Junda Woo, “Rulings Clash
over Colors in Trademarks,” The Wall
Street Journal, Feb. 25, 1993, p. B1.
56. Cindy Waxer, “Computer Couture,”
Yahoo! Internet Life, November 1999,
pp. 144–145.
57. Meera Somasundaram, “Red Packages
Lure Shoppers Like Capes Flourished
at Bulls,” The Wall Street Journal,
Sept. 18, 1995, p. A13B.
58. Ross Johnson and William O.
Winchell, Marketing and Quality Control,
American Society for Quality
Control, Milwaukee, 1989, p. 2.
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Notes and Refe rences N-9
59. Scott McCartney, “Middling Quality
as a Marketing Plus? Survey Finds
a Link,” The Wall Street Journal,
May 16, 1994, p. B6.
60. Kevin Schweitzer, “Japanese, European
Car Companies Still Lead in
Quality, But U.S. Makers Close,”
Chicago Tribune, Oct. 28, 2001, p. 1.
For a list of reasons why product quality
is so important and for a discussion
of the marketing function’s role in
quality management, see Neil A. Morgan
and Nigel F. Pierce, “Market Led
Quality,” Industrial Marketing Management,
May 1992, pp. 111–118.
61. James B. Treece, “GM Hustles Compact
into Production,” Automotive
News, Dec. 18, 2000, p. 36; “Buick to
Lead Price Cuts for China’s Auto Industry,”
Xinhua News Agency, Apr. 14,
2000, no page given; and T. S. Raghunathan,
S. Subba Rao, and Luis S. Solis,
“A Comparative Study of Quality Practices:
USA, China and India,” Industrial
Management & Data Systems,
May–June 1997, p. 192.
62. Ana Belen Escrig Tena, Juan Carlos Bou
Llusar, and Vicenta Roca Puig, “Measuring
the Relationship between Total
Quality Management and Sustainable
Competitive Advantage: A ResourceBased View,” Total Quality Management,
December 2001, pp. 932_.
63. Mark Henricks, “A New Standard,” Entrepreneur,
October 2002, pp. 83–84.
64. Mike Delpha, “ISO 9001:2000 Upgrade:
Tips for a Smooth Transition,”
Professional Safety, July 2002, pp. 14,
17. ISO 9000 is covered in Ronald
Henkoff, “The Hot New Seal of
Quality,” Fortune, June 28, 1993,
pp. 116–118, 120.
65. Salton, Inc., Form 10-K for the fiscal
year ended June 29, 2002; Salton, Inc.,
2002 annual report; Johnson, loc. cit.
Chapter 10
1. Chris Ayres, “U.S. Car Rental Firms in
Chaos in Wake of Attacks,” The London
Times, Business section, Sept. 29,
2001, p. 23; Al Stamborski, “Clayton,
Mo.–Based Rental Car Company Gains
Customers through Quality Service,”
St. Louis Post-Dispatch, May 24, 2000,
p. C1; Kortney Stringer, “Reservations
Grow Over Rental-Car Industry’s Weak
Links,” The Wall Street Journal, Nov.
14, 2001, p. B4; www.enterprise.com
accessed on Jan. 21, 2002.
2. Statistics on the economy are from the
Statistical Abstract of the United
States: 2001, 121st ed., U.S. Bureau of
the Census, Washington, DC, 2001.
3. Libby Estill, “Sweet Charity,” Incentive,
June 2002, p. 26.
4. Trevor Jensen, “USPS Brings a New
Campaign,” Adweek Midwest Edition,
Feb. 25, 2002, p. 2.
5. Based on Leonard L. Berry and Terry
Clark, “Four Ways to Make Services
More Tangible,” Business, October–
December 1986, p. 53.
6. Michelle Higgins, “Why Banks Are
Getting Nicer,” The Wall Street Journal,
May 29, 2002, p. D1.
7. Neal Templin, “For Hotel Guests with
Glitches, High-Tech Room Service,”
The Wall Street Journal, Aug. 30,
1999, pp. B1_.
8. Based on Allan C. Reedy, Bruce D.
Buskirk, and Ajit Kaicker, “Tangibilizing
the Intangibles: Some Strategies for
Services Marketing,” Journal of Services
Marketing, no. 3 (1993), pp. 13–17.
9. Visit the Advertising Slogan Hall of
Fame at www.adslogans.co.uk for examples
of memorable slogans from the
past.
10. A good description of how one company
handles the service encounter is
described in Keith H. Hammonds,
“Handle with Care,” Fast Company,
August 2002, pp. 102–107.
11. Melinda Ligos, “Mall Rats with a Social
Conscience,” Sales & Marketing
Management, November 1999, p 115;
Aja Whitaker, “Cause Marketing Gaining
Ground,” Management Review,
September 1999, p. 8.
12. Vince Crawley and Rick Maze, “Military
Cutting Back on High-Priced Television
Commercials,” Navy Times,
Mar. 25, 2002, P. 18; Vince Crawley,
“Pentagon Seeks Target Definition in
Recruiting Ads,” Navy Times, Aug.
14, 2000, p. 21.
13. Bree Fowler, “Congregation of Nuns
Uses Internet, TV for Recruiting,” South
Bend Tribune, June 10, 2002, p. C3.
14. Estill, loc.cit.
15. Satisfaction with services is based on a
customer’s perceptions of various types
of convenience, most of which are controlled
by the seller. Leonard L. Berry,
Kathleen Seiders, and Dhruv Grewal,
“Understanding Service Convenience,”
Journal of Marketing, July 2002,
pp. 1–17, describe how the relationship
may work.
16. Ann Grimes, “What’s in Store,” The
Wall Street Journal, July 15, 2002, p. R6.
17. Heather Harreld, “Pick-Up Artists,”
CIO Magazine, Nov. 1, 2000, at CIO
archives www.cio.com; Al Stamborski,
loc. cit.
Chapter 11
1. www.priceline.com, accessed on Mar. 9,
2002; Julia Angwin, “Hit by Travel
Slump, Priceline Posts a Loss,” The Wall
Street Journal, Feb. 5, 2002, p. B5; Julia
Angwin, “After Surviving Dot-Com
Rout, Priceline Enters New Storm,” The
Wall Street Journal, Sept. 20, 2001,
p. B9; Julia Angwin, “Priceline.com
Posts a Profit, Crediting Stringent Cost
Cuts, Escalating Demand,” The Wall
Street Journal, Aug. 1, 2001, p. A3;
“Priceline.com Replaces Its CEO in
Struggle toward Profitability,” St. Louis
Post-Dispatch, May 8, 2001, p. F7;
“Priceline and Expedia Bury the Ax,”
Business Week, Jan. 22, 2001, p. 46;
Peter Elkind, “The Hype Is Big, Really
Big, at Priceline,” Fortune, Sept. 6,
1999, pp. 193–194_ ; Shari Weiss, “Internet
Offers Priceless Marketing, Booking
Opportunities,” Hotel & Motel
Management, June 3, 1999, pp. 58, 60;
and Heather Green, “Priceline’s Bid for
the Big Time,” Business Week, Jan. 18,
1999, p. 43.
2. This list was suggested in part by John T.
Mentzer and David J. Schwartz, Marketing
Today, 4th ed., Harcourt Brace
Jovanovich, San Diego, 1985, p. 599.
3. David Meer, “System Beaters, Brand
Loyals, and Deal Shoppers: New Insights
into the Role of Brand and
Price,” Journal of Advertising Research,
May/June 1995, pp. RC2–RC7.
4. Stephen J. Hoch, Byung-Do Kim,
Alan L. Montgomery, and Peter E.
Rossi, “Determinants of Store-Level
Price Elasticity,” Journal of Marketing
Research, February 1995, p. 28.
5. Roberta Maynard, “Taking Guesswork
out of Pricing,” Nation’s Business,
December 1997, p. 28. For indepth
discussions of the relationship
between price levels and perceived
quality, see David J. Curry and Peter C.
Riesz, “Prices and Price/Quality Relationships:
A Longitudinal Analysis,”
Journal of Marketing, January 1988,
pp. 36–51; and Valarie A. Zeithaml,
“Consumer Perceptions of Price, Quality,
and Value: A Means-End Model
and Synthesis of Evidence,” Journal of
Marketing, July 1988, pp. 2–22.
6. Stephanie Paterik, “Business Hotels
Court the Family Crowd,” The Wall
Street Journal, Aug. 7, 2002, p. D1;
and Caroline Wilbert, “What Recession?
Extended-Stay Hotels’ Business
Remains Sweet in a Sour Economy,”
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N-10 Notes and Refe rences
Atlanta Journal-Constitution, Aug. 20,
2002, p. D1.
7. Dean Takahashi, “Little Caesar’s Plans
‘Big! Big!’ Pizzas, while Keeping Price
Structure the Same,” The Wall Street
Journal, Sept. 2, 1997, p. B6; and Rahul
Jacob, “Beyond Quality and Value,”
Fortune (special issue), Autumn/Winter
1993, pp. 8, 10.
8. Gary H. Anthes, “The Price Had Better
Be Right,” Computerworld, Dec. 21,
1998, pp. 65–66.
9. Frank Alpert, Beth Wilson, and
Michael T. Elliott, “Price Signaling:
Does It Ever Work?” Journal of Product
& Brand Management, vol. 2, no. 1,
1993, pp. 29–41.
10. For a list of 21 pricing objectives and a
discussion of objectives as part of a strategic
pricing program for industrial firms,
see Michael H. Morris and Roger J.
Calantone, “Four Components of Effective
Pricing,” Industrial Marketing Management,
November 1990, pp. 321–329.
11. Caroline Daniel, “Monsanto Enters a
Time of Transition, Financial Times,
Aug. 19, 2002, p. 25; and Robert Steyer,
“Monsanto Slashes Roundup Prices,”
St. Louis Post-Dispatch, Sept. 2, 1998,
p. C1.
12. Sam Nataraj and Jim Lee, “Dot-Com
Companies: Are They All Hype?” SAM
Advanced Management Journal, July 1,
2002, pp. 10_; and George Anders,
“Buying Frenzy,” The Wall Street Journal,
July 12, 1999, pp. R6, R10.
13. Katherine Zachary, “The Yen, Again,”
Ward’s Auto World, April 2002,
pp. 24–25.
14. For a discussion of new-product pricing,
taking into account the product’s
perceived benefits and entry time, see
Eunsang Yoon, “Pricing Imitative New
Products,” Industrial Marketing Management,
May 1991, pp. 115–125.
15. Maynard, op. cit., p. 27.
16. Zachary Schiller, “The Revolving Door
at Rubbermaid,” Business Week,
Sept. 18, 1995, pp. 80–83.
17. Imogen Wall, “It May Be a Dog-EatDog World, but This Restaurant Won’t
Prove It,” The Wall Street Journal,
Dec. 11, 1998, p. B1.
18. For a report on how this is done in the
business market, see Michael H. Morris
and Mary L. Joyce, “How Marketers
Evaluate Price Sensitivity,” Industrial
Marketing Management, May
1988, pp. 169–176.
19. George E. Cressman, Jr., “Snatching
Defeat from the Jaws of Victory,”
Marketing Management, Summer
1997, p. 15
20. Daniel Eisenberg, “Kodak’s Photo
Op,” Time, Apr. 30, 2001, pp. 46–47;
and Chanoine Webb, “The Picture Just
Keeps Getting Darker at Kodak,” Fortune,
June 21, 1999, p. 206.
21. Steve Hamm, “The Wild and Woolly
World of Linux,” Business Week, Nov.
15, 1999, pp. 130, 134; James Aley,
“Give It Away and Get Rich!” Fortune,
June 10, 1996, pp. 90–92_; and Neil
Gross and Peter Coy, “The Technology
Paradox,” Business Week, Mar. 6,
1995, pp. 76–81, 84.
22. Tom Lester, “How to Ensure That the
Price Is Exactly Right,” Financial Times,
Jan. 30, 2002, no pages given; and
“Pricing Gets Easier (Sort Of),” Inc.,
November 1993, p. 124.
23. Avraham Shama, “E-Coms and Their
Marketing Strategies,” Business Horizons,
September 2001, pp. 14_; and
Morris and Calantone, op. cit., p. 323.
24. The perspective that price dictates cost
levels is presented in Christopher Farrell
and Zachary Schiller, “Stuck!” Business
Week, Nov. 15, 1993, pp. 146, 148.
The magnitude of Kodak’s cost-cutting
efforts is from Webb, loc. cit.
25. For an approach to break-even analysis
that includes semifixed costs and is of
more practical value in situations typically
faced by marketing executives, see
Thomas L. Powers, “Breakeven Analysis
with Semifixed Costs,” Industrial Marketing
Management, February 1987,
pp. 35–41.
26. G. Dean Kortge and Patrick A.
Okonkwo, “Perceived Value Approach
to Pricing,” Industrial Marketing Management,
May 1993, p. 134.
27. Dan Koeppel, “Fast Food’s New Reality,”
Adweek’s Marketing Week, Mar.
30, 1992, pp. 22–23.
28. Margaret Studer, “Patek Philippe Is
Luxuriating in Independence,” The
Wall Street Journal, Dec. 11, 2000,
p. B18; and Thomas T. Nagle, “Managing
Price Competition,” Marketing
Management, vol. 2, no. 1, 1993, p. 41.
29. www.britishairways.com, accessed July
30, 2002; and “Air France Celebrates
Supersonic Summer,” PR Newswire,
May 19, 1999.
30. Matt Krantz, “Priceline Turns Its First
Profit,” USA Today, Aug. 1, 2001,
p. 3B; Julia Angwin, “Priceline Founder
Closes Online Bidding Sites for Gas and
Groceries,” The Wall Street Journal,
Oct. 6, 2000, p. B1; Nick Wingfield,
“New Battlefield for Priceline Is Diapers,
Tuna,” The Wall Street Journal,
Sept. 22, 1999, p. B1; and Weiss, loc. cit.
Chapter 12
1. “In the Hot Seat: Q&A with Bluefly’s
Ken Seiff,” Retailing Today, Aug. 21,
2000, pp. A10–A12; Rebecca Quick,
“Bluefly’s Goal: Raise Margins, but
Keep Fans,” The Wall Street Journal,
Jan. 25, 2001, pp. B1, B4; Michael
Totty, “Making the Sale,” The Wall
Street Journal, Sept. 24, 2001, p. R6;
“Bluefly Inc. Streamlines Operations,”
Home Textiles Today, June 25, 2001,
p. 6; Paul Miller, “Bluefly.com Enters
the Catalog Fray—or Does It?” Catalog
Age, June 2001, pp. 25; www.bluefly.
com, accessed on Mar. 10, 2002.
2. Erin White, “Major Airlines Face Strategy
Bind,” The Wall Street Journal, Oct.
3, 2002, p. B10.
3. Gary Strauss, “99¢ Only Started Trend,”
USA Today, June 22, 1998, pp. 1B, 2B.
4. Don Clark, “Intel to Release Itanium 2
Chip–Company Hopes Entry Will Allow
It to Charge High End of Computing,”
The Asian Wall Street Journal,
July 9, 2002, p. A7.
5. Patricia Sellers, “Look Who Learned
about Value,” Fortune, Oct. 18, 1993,
p. 75; and Bill Saporito, “Why the
Price Wars Never End,” Fortune, Mar.
23, 1992, pp. 68_.
6. Stratford Sherman, “How to Prosper in
the Value Decade,” Fortune, Nov. 30,
1992, p. 98.
7. Anne Faircloth, “ Values Retailers Go
Dollar for Dollar,” Fortune, July 6,
1998, p. 166.
8. Albert D. Bates, “Pricing for Profit,”
Retailing Issues Newsletter, September
1990, p. 1.
9. For three recommended forms of nonprice
competition for retailers, see Bates,
op. cit., p. 4.
10. William Echikson, “Aiming at High
and Low Markets,” Fortune, Mar. 22,
1993, p. 89.
11. Sean O’Neill, “Eyes on the Price,”
Kiplinger’s Personal Finance, September
2000, pp. 122–123.
12. Charles Forelle, “Do You Really Need
a Turbo Toothbrush?” The Wall Street
Journal, Oct. 1, 2002, pp. D1, D4; and
Robert Berner, “Why P&G’s Smile Is
So Bright,” Business Week, Aug. 12,
2002, pp. 58–60.
13. Neil Gross and Peter Coy, “The Technology
Paradox,” Business Week,
Mar. 6, 1995, pp. 76–77.
etz26505_notes.qxd 4/16/03 12:55 PM Page N-10
Notes and Refe rences N-11
14. Reed K. Holden and Thomas T. Nagle,
“Kamikaze Pricing,” Marketing Management,
Summer 1998, p. 39.
15. Dan Carney, “Caveat Predator?” Business
Week, May 22, 2000, pp. 116, 118;
and Mike France and Steve Hamm,
“Does Predatory Pricing Make Microsoft
a Predator?” Business Week,
Nov. 23, 1998, pp. 130, 132.
16. Robert Steyer, “Monsanto Offers Discounts
to Dairy Farmers,” St. Louis
Post-Dispatch, Oct. 22, 1995, p. 1E.
17. William M. Bulkeley, “Rebates’ Secret
Appeal to Manufacturers: Few Consumers
Actually Redeem Them,” The
Wall Street Journal, Feb. 10, 1998,
pp. B1, B6.
18. Geoffrey A. Fowler, “Click and Clip,”
The Wall Street Journal, Oct. 21, 2002,
p. R8; and Roger O. Crockett, “PennyPinchers’ Paradise: E-Coupons Are
Catching On Fast—and Companies
Are Learning to Use Them,” Business
Week e.biz, Jan. 22, 2001, p. EB12.
19. For more about this approach, see Hermann
Simon and Robert J. Dolan, “Price
Customization,” Marketing Management,
Fall 1998, pp. 10–17.
20. Edward R. Silverman, “Drug Makers
Score Startling Victory against Retail
Pharmacies,” The Star-Ledger (Newark,
NJ), Dec. 1, 1998, no pages given.
21. David Kipen, “Readers Make or Break
Independent Bookstores,” San Francisco
Chronicle, Apr. 25, 2001, p. E1.
22. Douglas A. Blackmon, “FedEx Is to
Adopt Rate Structure Based on Distance
Package Travels,” The Wall
Street Journal, Jan. 23, 1997, p. B4.
23. For further discussion of pricing strategies
and policies, see Gerard J. Tellis, “Beyond
the Many Faces of Price: An Integration
of Pricing Strategies,” Journal of
Marketing, October 1986, pp. 146–160.
24. For a theoretical model of flexible pricing
and discussion of its managerial implications,
see Kenneth R. Evans and
Richard F. Beltramini, “A Theoretical
Model of Consumer-Negotiated Pricing:
An Orientation Perspective,” Journal of
Marketing, April 1987, pp. 58–73.
25. “Auto Report,” The Seattle Times, Aug.
23, 2002, p. F1; Joann Muller, “Old Carmakers
Learn New Tricks,” Business
Week, Apr. 12, 1999, pp. 116, 118; and
Brian S. Akre, “Restructure of Dealer
Networks Will Change Retailing,” Marketing
News, Oct. 26, 1998, p. 10.
26. Julia Angwin, “America Online Faces
New Threat from Cut-Rate Internet
Services,” The Wall Street Journal, Feb.
3, 2003, pp. A1, A11; and Peter Coy,
“Are Flat Rates Good Business?” Business
Week, Feb. 10, 1997, p. 108.
27. Strauss, loc. cit.
28. A study of the beneficial effects of odd
pricing, if used on a very limited basis,
is mentioned in “Why That Deal Is
Only $9.99,” Business Week, Jan. 10,
2000, p. 36. Previously the effectiveness
of odd pricing was described in
Robert M. Schindler and Lori S. Warren,
“Effects of Odd Pricing on Price
Recall,” Journal of Business, June 1989,
pp. 165–177. Consumers’ paying attention
to just the first two digits in a
price is examined in Mark Stiving and
Russell S. Winer, “An Empirical Analysis
of Price Endings with Scanner
Data,” Journal of Consumer Research,
June 1997, pp. 57–67.
29. David D. Kirkpatrick, “Chains Raising
Book Prices,” Portland Oregonian,
Oct. 10, 2000, p. B1; and George Anders,
“Amazon Plans to Offer 50% Discounts
on Hardcover, Paperback Bestsellers,”
The Wall Street Journal, May
17, 1999, p. B11.
30. Russell Gold and Ann Zimmerman,
“Pumped Out: Wal-Mart’s Defeat in
Low-Cost Gas Game,” The Wall Street
Journal, Aug. 13, 2001, p. A14; and
“Wal-Mart Wins Suit over Low-Price
Strategy,” St. Louis Post-Dispatch,
Jan. 10, 1995, p. 7C.
31. Peter J. McGoldrick, Erica J. Betts,
and Kathy A. Keeling, “High-Low
Pricing: Audit Evidence and Consumer
Preferences,” The Journal of
Product and Brand Management,
2000, pp. 316–331; G. S. Bobinski,
D. Cox, and A. Cox, “Retail ‘Sale’
Advertising, Perceived Retailer Credibility
and Price Rationale,” Journal
of Retailing, Fall 1996, pp. 291–306;
and “Consumers’ Reference Prices:
Implications for Managers,” Stores,
April 1996, p. RR4.
32. Patrick J. Kaufmann, N. Craig Smith,
and Gwendolyn K. Ortmeyer, “Deception
in Retailer High-Low Pricing: A
‘Rule of Reason’ Approach,” Journal
of Retailing, Summer 1994, pp. 151.
33. For an overview of how one chain,
Family Dollar Stores, switched from
high-low pricing to EDLP, see Michael
Friedman, “A Contented Discounter,”
Progressive Grocer, November 1998,
pp. 39–41. For information about other
chains’ use of EDLP, see Duke Ratliff,
“Variations on the Theme,” Discount
Merchandiser, March 1996, pp. 24–25.
The appearance of EDLP in Germany is
covered in Jennifer Negley, “Jeden Tag
Tiefpreise—Sprechen sie EDLP?” Discount
Store News, June 8, 1998, p. 17.
34. Stuart Hirshfield, “The Squeeze,” Apparel
Industry Magazine, August 1998,
pp. 60–64.
35. Tim Ambler, “P&G Learnt the Hard
Way from Dropping Its Price Promotions,”
Marketing, June 7, 2001, p. 22.
36. Stephen J. Hoch, Xavier Drpze, and
Mary E. Purk, “EDLP, Hi-Lo, and
Margin Arithmetic,” Journal of Marketing,
October 1994, pp. 16–27.
37. For a discussion of the legal status of
resale price maintenance, plus some
steps that manufacturers can take to
avoid legal problems when establishing
resale price maintenance programs, see
Mary Jane Sheffet and Debra L. Scammon,
“Resale Price Maintenance: Is It
Safe to Suggest Retail Prices?” Journal
of Marketing, Fall 1985, pp. 82–91.
38. Joel M. Cohen and Arthur J. Burke,
“Antitrust: Supreme Court Acts on
Maximum Pricing,” International Commercial
Litigation, December 1997/January
1998, p. 43, and Susan B. Garland,
“You’ll Charge What I Tell You to
Charge,” Business Week, Oct. 6, 1997,
pp. 118, 120.
39. “Nine West Settles State and Federal
Price Fixing Charges,” M2 Presswire,
Mar. 7, 2000, no pages given.
40. Michael Selz, “Small Firms Use Variety
of Ploys to Raise Prices,” The Wall
Street Journal, June 17, 1993, p. B1.
41. Thomas T. Nagle, “Managing Price
Competition,” Marketing Management,
vol. 2, no. 1, 1993, p. 45.
42. Scott Kilman, “Diageo Says Industry
Price War Is Crimping Its Burger King
Sale,” The Wall Street Journal, Nov.
8, 2002, p. A3. Cliff Edwards,
“Everyone Loves a Freebie—except
Dell’s Rivals,” Business Week, July
22, 2002, p. 41; and Robert Weller,
“Colorado Ski Resorts Give In to
Need for Deep Discounts,” St. Louis
Post-Dispatch, Sept. 4, 1999,
p.33OT. The statement about price
wars, made by a McKinsey consultant,
was contained in David R. Henderson,
“What Are Price Wars Good
For? Absolutely Nothing,” Fortune,
May 12, 1997, p. 156.
43. The description of price-war damages
is from Andrew E. Serwer, “How to
Escape a Price War,” Fortune, June
13, 1994, pp. 82_. The example
about music retailing is based on Tim
Carvell, “These Prices Really Are Insane,”
Fortune, Aug. 4, 1997,
pp. 109–110_.
etz26505_notes.qxd 4/22/03 3:36 PM Page N-11
N-12 Notes and Refe rences
44. “In the Hot Seat: Q&A with Bluefly’s
Ken Seiff,” loc. cit.; Quick, op. cit.;
Totty, op. cit.; “Bluefly Inc. Streamlines
Operations,” loc. cit.; Miller, op. cit.;
www.bluefly.com, accessed on Mar. 10,
2002.
Chapter 13
1. www.avoncompany.com, accessed on
May 11, 2002; “J.C. Penney Shows
Avon the Door,” USA Today, Feb. 3,
2003, p. 1B. Emily Nelson, “Avon Calls
on Good-Looking Research,” The Wall
Street Journal, May 23, 2002, p. B6;
“Avon to Target Teens,” Direct Marketing,
November 2001, p. 22; Katarzyna
Moreno, “UnbeComing,” Forbes, June
10, 2001, pp. 151–152; Janet Ginsburg,
“Deck the Malls with Kiosks,” Business
Week, Dec. 13, 1999, pp. 86–88; Laura
Klepacki, “Avon to Make Stronger
Move into Retailing,” WWD, Dec. 8,
1999, p. 2; Carolyn Edy, “Avon
Malling,” American Demographics,
April 1999, pp. 38–40; Leslie Kaufman,
“Avon’s New Face,” Newsweek, Nov.
16, 1998, p. 24; and Sharon Machlis,
“Beauty Product Sites Facing Channel
Clash,” Computerworld, Nov. 9,
1998, p. 24.
2. Stacy Collett, “Off-Line Dealers Push
for Legal Protection,” Computerworld,
Apr. 16, 2001, p. 17; and “Merrill
Lynch Shakes Up Industry by Going
Online,” St. Louis Post-Dispatch, July
22, 1999, p. B13. For a discussion of the
contention that the Internet is the
biggest influence on distribution since
the Industrial Revolution, see Leyland
Pitt, Pierre Berthon, and Jean-Paul
Berthon, “Changing Channels: The Impact
of the Internet on Distribution Strategy,”
Business Horizons, March/April
1999, pp. 19–28.
3. For insight regarding whether the Internet
will eliminate middlemen in two industries,
air travel and groceries, see Eric
Clemons, “When Should You Bypass the
Middleman?” Financial Times, Feb. 22,
1999, p. 14. The term disintermediation
is explained further in “On-Line Commerce
Business Trends,” The Wall Street
Journal, Dec. 12, 1996, p. B4.
4. The concept of shifting activities, the
possibility of manufacturers shifting
some functions away from their firms,
and the opportunity for small wholesalers
to perform added functions to
maintain their economic viability are
all discussed in Ronald D. Michman,
“Managing Structural Changes in Marketing
Channels,” The Journal of Business
and Industrial Marketing, Summer/
Fall 1990, pp. 5–14. The distinctive
ways in which electronic channel members
carry out distribution-related
activities are described in Robert
D. Tamilia, Sylvain Senecal, and Giles
Corriveau, “Conventional Channels of
Distribution and Electronic Intermediaries:
A Functional Analysis,” Journal
of Marketing Channels, vol. 9, nos. 3/4,
pp. 27–48.
5. Barbara Thau, “Target Inks Deal with
Fleming to Supply Food to Stores,
Cafes,” HFN, July 15, 2002, p. 4; and
Maria Halkias, “Fleming Shares
Plunge,” The Dallas Morning News,
Feb. 5, 2003, p. 1D.
6. www.lotuslight.com, accessed on
Oct. 25, 2002; and Julie Candler, “How
to Choose a Distributor,” Nation’s Business,
August 1993, p. 46.
7. www.statefarm.com/quote/arq.htm, accessed
on Sept. 16, 2002; and Diane
Brady, “Insurers Step Gingerly into Cyberspace,
Business Week, Nov. 22, 1999,
p. 160.
8. Karen Roche and Bill O’Connell, “Dig
a Wider Channel for Your Products,
Marketing News, Nov. 9, 1998, p. 10.
9. For guidance on selecting channels for
international markets, especially the decision
of whether to use middlemen, see
Saul Klein, “Selection of International
Marketing Channels,” Journal of Global
Marketing, vol. 4, 1991, pp. 21–37.
10. The New Pig example is drawn from
“Unconventional Channels,” Sales
& Marketing Management, October
1988, p. 38.
11. Craig Zarley and Edward F. Moltzen,
“IBM Takes Direct Route to Small
Firms,” Computer Reseller News,
Mar. 1, 1999, p. 2.
12. www.marshallamps.com, accessed on
Oct. 25, 2002.
13. An excellent discussion of distribution
channels for business goods and services
is found in Michael D. Hutt and Thomas
W. Speh, Business Marketing Management,
7th ed., Harcourt, Ft. Worth, TX,
2001, pp. 355–381.
14. Maricris G. Briones, “Resellers Hike
Profits through Service,” Marketing
News, Feb. 15, 1999, pp. 1, 14; and
Maricris G. Briones, “What Technology
Wrought: Distribution Channel
in Flux,” Marketing News, Feb. 1,
1999, pp. 1, 15.
15. For an instructive discussion of this
topic, see Donald H. Light, “A Guide for
New Distribution Channel Strategies for
Service Firms,” The Journal of Business
Strategy, Summer 1986, pp. 56–64.
16. J. C. Conklin, “That’s the Ticket,” The
Wall Street Journal, July 12, 1999,
p. R45; and George Anders, “Some Big
Companies Long to Embrace Web but
Settle for Flirtation,” The Wall Street
Journal, Nov. 4, 1998, p. A14.
17. Rowland T. Moriarty and Ursula
Moran, “Managing Hybrid Marketing
Systems,” Harvard Business Review,
November–December 1990,
pp. 146–155.
18. For extensive discussion of this approach
to serving distinct markets, see
Wim G. Biemans, “Marketing in the
Twilight Zone,” Business Horizons, November/
December 1998, pp. 69–76; and
John A. Quelch, “Why Not Exploit
Dual Marketing?” Business Horizons,
January–February 1987, pp. 52–60.
19. Deborah Lohse, “Allstate to Launch Online
Sales of Car and Home Insurance,”
The Wall Street Journal, Nov. 11, 1999,
p. B18; Samuel Schiff, “Agency System
Lives but Continued Survival Will Require
Adapting to Changes,” Rough
Notes, February 1999, pp. 14–16; and
“Dramatic Shift to Multiple Distribution
Channels for Property-Casualty Insurance
Industry,” Limra’s Marketfacts,
March/April 1998, p. 6.
20. Milford Prewitt, “Franchisees’ Lawsuits:
Chains’ Nontraditional Growth
Paths Lead to New Encroachment Battles,”
Nation’s Restaurant News, Oct.
9, 1995, pp. 118–120; and Jack Hayes,
“Carvel, Franchisees Lock Horns over
Retail Program, Nation’s Restaurant
News, Sept. 4, 1995, pp. 3, 82.
21. The Scotts example comes from Valerie
Reitman, “Manufacturers Start to Spurn
Big Discounters,” The Wall Street Journal,
Nov. 30, 1993, p. B1. For further
discussion of the advantages and disadvantages
of multiple channels as well as
ways to minimize conflict resulting from
multiple channels, see Martin Everett,
“When There’s More than One Route to
the Customer,” Sales & Marketing Management,
August 1990, pp. 48–50_.
22. “Ford Sells Oklahoma Dealerships,”
The Associated Press State & Local
Wire, Apr. 4, 2002; Carol Matlack,
“Swatch: Ready for Net Time?” Business
Week, Feb. 14, 2000, p. 61; Earle
Eldridge, “GM Settles Argument with
Dealerships,” USA Today, Jan. 24,
2000, p. 2B; Gregory L. White, “Ford
Restarting Move to Buy Stakes in Its
Dealers, Albeit More Cautiously,” The
Wall Street Journal, Nov. 22, 1999,
p. B22; and Joann Muller, “Meet Your
Local GM Dealer: GM,” Business
Week, Oct. 11, 1999, p. 48.
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Notes and Refe rences N-13
23. For details about Kraft Foods’ approach
to coordinating (perhaps controlling)
distribution activities, see Brandon
Copple, “Shelf-Determination,” Forbes,
Apr. 15, 2002, pp. 130–132_.
24. Wal-Mart’s dominating power and increasing
control in the area of distribution
(and, more broadly, the economy and society
as a whole) are described in Jerry
Useem, “One Nation under Wal-Mart,
Fortune, Mar. 3, 2003, pp. 65–86_;
Jim Hopkins, “Wal-Mart’s Influence
Grows,” USA Today, Jan. 29, 2003,
pp. 1B_; and Copple, op. cit., p. 140.
25. “Dynamic Shift to Multiple Distribution
Channels . . . ,” loc. cit.
26. Michael Selz, “More Small Firms Are
Turning to Trade Intermediaries,” The
Wall Street Journal, Feb. 2, 1993, p. B2.
27. For more on the idea that market considerations
should determine a channel
structure, see Louis W. Stern and
Frederick D. Sturdivant, “CustomerDriven Distribution Systems,” Harvard
Business Review, July–August
1987, pp. 34–41.
28. Anders, op. cit., pp. A1, A14.
29. Bert Rosenbloom and Trina L. Larsen,
“How Foreign Firms View Their U.S.
Distributors,” Industrial Marketing
Management, May 1992, pp. 93–101.
30. “Putting the Aim Back into Famous
Amos,” Sales & Marketing Management,
June 1992, p. 31.
31. Reitman, op. cit., pp. B1, B2; and
Christina Duff, “Nation’s Retailers Ask
Vendors to Help Share Expenses,” The
Wall Street Journal, Aug. 4, 1993, p. B4.
32. Robert Berner, “Kissing Off the Cosmetics
Counter,” Business Week, Oct.
30, 2000, pp. 108, 112.
33. For an in-depth discussion of differences
in distribution intensity, as well
as a study of this factor in the context
of the consumer electronics industry,
see Gary L. Frazier and Walfried M.
Lassar, “Determinants of Distribution
Intensity,” Journal of Marketing, October
1996, pp. 39–51.
34. Shelly Branch, “P&G Is out to Fetch Distribution
Gains for Iams Pet Food,” The
Wall Street Journal, Jan. 6, 2000, p. A6.
35. www.step2.com, accessed on Oct. 26,
2002; and Reitman, op. cit., pp. B1, B2.
36. Sara Nathan, “Defining the Seller in
On-Line Market,” USA Today, Aug.
26, 1999, p. 3B.
37. Ann Zimmerman, “Grocery Distributor
Squeezes Suppliers at Bill-Paying
Time,” The Wall Street Journal, Sept. 5,
2002, pp. A1, A10; “Facing Charges,”
HFN, Oct. 8, 2001, pp. 8_; and “Retailers’
Defense: Chargebacks Spring
from Non-Compliance,” HFN, Oct. 8,
2001, pp. 11–12.
38. Stephane Farhi, “Eggs, Bread—and a
Discount Daewoo,” Automotive News,
June 28, 1999, p. 46.
39. Thomas Lee, “A-B Watches from the
Sidelines as Brewery Buyout Frenzy
Unfolds,” St. Louis Post-Dispatch,
Apr. 21, 2002, p. E1; and Jakki J.
Mohr, Robert J. Fisher, and John R.
Nevin, “Communicating for Better
Channel Relationships,” Marketing
Management, Summer 1999, p. 40.
40. “Two Outlet Stores Open in Distribution
Strategy,” The Wall Street Journal,
Mar. 11, 1997, p. B6; and Teri Agins,
“Apparel Makers Are Refashioning
Their Operations,” The Wall Street
Journal, Jan. 13, 1994, p. B4.
41. Luisa Kroll, “Tough Guy,” Forbes,
Feb. 4, 2002, pp. 60–61; and Bill Saporito,
“Cutting Out the Middleman,”
Fortune, Apr. 6, 1992, p. 96.
42. Rachel Melcer, “Graybar Grows out
of Middleman Role,” St. Louis PostDispatch, Sept. 1, 2002, p. E1.
43. “Levi’s Plans Own Stores,” Marketing
News, Jan. 30, 1995, p. 1.
44. Laura Bird and Wendy Bounds,
“Stores’ Demands Squeeze Apparel
Companies,” The Wall Street Journal,
July 15, 1997, pp. B1, B12.
45. “Shelf Help?” Entrepreneur, October
2002, p. 28; Clayton Kale, “GAO Says
Grocers Offered Little Help in Investigation,”
St. Louis Post-Dispatch, Sept.
15, 2000, p. C6; Holman W. Jenkins,
Jr., “We . Slotting Fees,” The Wall
Street Journal, Sept. 22, 1999, p. A23;
Nahal Toosi, “Congress Looks at the
Selling of Shelf Space,” St. Louis PostDispatch, Sept. 15, 1999, p. C1.
46. Nichole L. Torres, “Examine Your CoOp(tions),” Entrepreneur, July 2002,
pp. 120, 128.
47. TruServ’s travails were described in Jeff
Bailey, “Co-ops Gain as Firms Seek
Competitive Power,” The Wall Street
Journal, Oct. 15, 2002, p. B5.
48. James E. Zemanek, Jr., and James W.
Hardin, “How the Industrial Salesperson’s
Use of Power Can Affect Distributor
Satisfaction: An Empirical Examination,”
Journal of Marketing Channels,
vol. 3, no. 1, 1993, pp. 23–45.
49. An early description of the dominance
of gigantic retailers and their demands
on manufacturers can be found in
Zachary Schiller and Wendy Zellner,
“Clout!” Business Week, Dec. 21,
1992, pp. 66–69_.
50. For a model showing a range of channel
relationships, see John T. Gardner,
W. Benoy Joseph, and Sharon Thach,
“Modeling the Continuum of Relationship
Styles between Distributors
and Suppliers,” Journal of Marketing
Channels, vol. 2, no. 4, 1993, pp. 11_.
The Sutter situation was described in
Candler, op. cit., p. 45.
51. “Wal-Mart Expands Access to Product
Sales History,” The Wall Street Journal,
Aug. 18, 1999, p. B8; and Myron Magnet,
“The New Golden Rule of Business,”
Fortune, Feb. 21, 1994, pp. 60–64.
For a discussion of attributes of successful
alliances in channels, based on a study
of computer dealers, see Jakki J. Mohr
and Robert E. Spekman, “Perfecting
Partnerships,” Marketing Management,
Winter/Spring 1996, pp. 35–43.
52. Magnet, loc. cit. For more ideas on how
to build a good producer-middleman relationship,
see James A. Narus and James
C. Anderson, “Distributor Contributions
to Partnerships with Manufacturers,”
Business Horizons, September–October
1987, pp. 34–42.
53. Agins, loc. cit.
54. Andrew Raskin, “Who’s Minding the
Store?” Business 2.0, February 2003,
pp. 70_.
55. John R. Nevin, “Relationship Marketing
and Distribution Channels: Exploring
Fundamental Issues,” Journal of
Marketing Channels, vol. 23, no. 4,
1995, pp. 327–334.
56. “Toys R Us, Two Toymakers Settle Discounting
Suit,” St. Louis Post-Dispatch,
May 26, 1999, p. C9.
57. “Federal Appeals Court Dismisses
Antitrust Suit against Domino’s,” Associated
Press Newswire, Aug. 27,
1997, no pages given; and Jeffrey A.
Tannenbaum, “Franchisees Balk at
High Prices for Supplies from Franchisers,”
The Wall Street Journal,
July 5, 1995, pp. B1, B2.
58. Jennifer E. Gully, “Image Technical Services,
Inc., v. Eastman Kodak Co.,”
Berkeley Technology Law Journal,
1998, pp. 339–353; and Wendy Bounds,
“Jury Finds Kodak Monopolized
Markets in Services and Parts for Its
Machines,” The Wall Street Journal,
Sept. 19, 1995, p. A4.
59. Joseph Pereira, “Stride Rite Agrees to
Settle Charges It Tried to Force Pricing
by Retailers,” The Wall Street Journal,
Sept. 28, 1993, p. B5.
etz26505_notes.qxd 4/22/03 3:36 PM Page N-13
N-14 Notes and Refe rences
60. www.avon.com, accessed on June 21,
2002; Sally Beatty, “Avon Is Set to Call
on Teens,” The Wall Street Journal,
Oct. 17, 2002, pp. B1, B7; Nanette
Byrnes, “Avon: The New Calling,” Business
Week, Sept. 18, 2000, pp. 136–148;
Erik Gruenwedel, “Kinzan to Launch
Branded Homepages for Avon Reps,”
Adweek, Aug. 21, 2000, p. 38; and Erin
White, “Ding-Dong, Avon Calling (on
the Web, Not Your Door),” The Wall
Street Journal, Dec. 28, 1999, p. B4.
Chapter 14
1. www.irconnect.com/petm/pages/
faq.html, accessed on June 10, 2002;
“Petsmart’s First-Quarter Surge
Boosts Yearly Forecast,” St. Louis
Post-Dispatch, June 5, 2002, p. C7;
Katherine Hutchison, “Petco Pumps
Up ‘Millennium’ Prototype,” DSN Retailing
Today, Nov. 5, 2001, pp. 3, 46;
and Katherine Hutchison, “PetsMart
Spruces Up Sales with New Services,
Improved Store Format,” DSN Retailing
Today, June 18, 2001, pp. 3, 46.
2. Statistical Abstract of the United
States: 2001, U.S. Bureau of the Census,
Washington, DC, 2001, p. 641.
3. As quoted in Lou Grabowsky, “Globalization:
Reshaping the Retail Marketplace,”
Retailing Issues Letter, November
1989, p. 4.
4. Statistical Abstract of the United States:
1999, U.S. Bureau of the Census, Washington,
DC, 1999, p. 561.
5. For specific ways in which small retailers
can remain competitive, see Dale D.
Buss, “The Little Guys Fight Back,”
Nation’s Business, July 1996,
pp. 18–24; and Stanley N. Logan,
“The Small Store—a Struggle to Survive,”
Retailing Issues Letter, January
1995, pp. 1–6.
6. 1992 Census of Retail Trade, Subject
Series, U.S. Bureau of the Census,
Washington, DC, 1996, p. 2–7; and
1992 Census of Wholesale Trade, Geographic
Area Series—U.S., U.S. Bureau
of the Census, Washington, DC, 1995,
p. US-9. The 8% figure was calculated
by multiplying the 11% representing
wholesale operating expenses by 72%,
the remainder after the 28% representing
retailing operating expenses is subtracted
from the 100% representing retail
sales (or the consumer’s dollar).
7. www.7-eleven.com/about/history.asp,
accessed on Aug. 26, 2002.
8. “The Plug Gets Pulled on Power Centers,”
Building Design & Construction,
April 1997, p. 9; and Ellen
Neuborne, “Stores Siphon Shoppers
from Regional Malls,” USA Today,
June 13, 1995, p. 1B.
9. Chern Yeh Kwok, “If It’s Upscale,
Trendy, Affluent and Convenient, It
Must Be a Lifestyle Center,” St. Louis
Post-Dispatch, Nov. 12, 2001, p. BP8;
and Dean Starkman, “The Mall, without
the Haul,” The Wall Street Journal,
July 25, 2001, pp. B1, B8.
10. Eric Slater, “Mall of America Altered
Retail Thinking,” The Arizona Republic,
Sept. 16, 2002, p. A7; and Richard
Gibson, “Mall of America Considers
Expansion That Would More than
Double Space,” The Wall Street Journal,
Dec. 30, 1999, p. B8.
11. Dean Starkman, “The Mall Rules,” The
Wall Street Journal, Dec. 18, 2002,
pp. B1, B6. Leslie Zganjar, “Mall
Makeovers,” The Business Journal,
Feb. 16–22, 2001, pp. 1, 9; and Calmetta
Y. Coleman, “Making Malls
(Gasp) Convenient,” The Wall Street
Journal, Feb. 8, 2000, pp. B1, B4. The
pessimistic forecast was contained in
Ellen James Martin, “Mall Blues,” Institutional
Investor, February 1997,
p. 119.
12. Chris Penttila, “Retailiatory Strike,”
Entrepreneur, December 2002, p. 122;
Matt Valley, “The Remalling of America,”
National Real Estate Investor,
May 2002, pp. 18–24; John McCloud,
“U.S. Shopping Centers Thrive as
Hubs of Entertainment,” National
Real Estate Investor, May 1999,
pp. 42–55; and Sunil Taneja, “Reinventing
the Experience,” Chain Store
Age, November 1998, pp. 153–156.
13. Valley, loc. cit.; and Gabrielle Solomon,
“Striking Gold in the Nation’s Urban
Core,” Fortune, May 10, 1999,
p. 152[J].
14. Mike Troy, “Neighborhood Market
Caps Year with Round of New Market
Entries,” DSN Retailing Today, Jan. 27,
2003, pp. 1, 22. www.walmartstores.
com, accessed Aug. 28, 2002; and Mike
Duff, “Home Depot Drops Villager’s
Hardware for New Concept,” DSN Retailing
Today, Apr. 22, 2002, p. 5.
15. Statistical Abstract of the United States:
1995, U.S. Bureau of the Census, Washington,
DC, 1995, p. 783.
16. International Franchise Association
website, www.franchise.org/resourcetr/
faq, accessed on Nov. 23, 2002.
17. Bernard Wysocki, Jr., “Start-Up with a
Safety Net,” Apr. 18, 2001, pp. B1, B6.
18. Peter M. Birkeland, Franchising Dreams,
University of Chicago Press, Chicago,
2002.
19. Dan Morse and Jeffrey A. Tannenbaum,
“Poll on High Success Rate for
Franchises Raises Eyebrows,” The
Wall Street Journal, Mar. 17, 1998,
p. B2; “Survey Reports 92 Percent of
Franchisees Say They Are Successful,”
Franchising World, May/June 1998,
pp. 34–36; and Geoff Williams, “Keep
Thinking,” Entrepreneur, September
2002, pp. 100_.
20. Growth areas for franchising are suggested
in Dan Morse, “Follow the Demographics,
Franchising Experts Advise,”
The Wall Street Journal, Dec. 21,
1999, p. B2; and Dennis Chaplin, “New
Partnerships for Franchising,” The Financial
Times, June 22, 1999, p. 2. Factors
that have contributed to franchising’s
growth are outlined in Bruce J.
Walker, “Retail Franchising in the
1990s,” Retailing Issues Letter, January
1991, pp. 1–4.
21. Amy Merrick, Jeffrey A. Trachtenberg,
and Ann Zimmerman, “Department
Stores Fight an Uphill Battle Just to Stay
Relevant,” The Wall Street Journal,
Mar. 12, 2002, pp. A1, A17; and Kevin
Helliker, “Montgomery Ward to End
128-Year Run in Retailing,” The Wall
Street Journal, Dec. 29, 2000, p. A3.
22. Brenda Lloyd, “Majors Seek Alternative
Retail Formats,” Daily News Record,
Aug. 26, 2002, p. 1; and David Moin,
“Differentiate or Die—Retail,” WWD,
June 8, 1998, p. 10.
23. Lloyd, loc. cit.; Anne D’Innocenzio,
“Kohl’s ‘a Terrible Headache,’” South
Bend Tribune, June 2, 2002, pp. B1, B3;
Dave Carpenter, “Sears Forsakes
‘Dowdy’ Clothes, Buys Lands’ End,” St.
Louis Post-Dispatch, May 14, 2002,
pp. A1, A9; and Stephanie Anderson
Forest, “A Speedy Makeover at Penney’s,”
Business Week, Apr. 29, 2002,
pp. 92, 94.
24. Lorrie Grant, “Holiday Sales Vital to
Kmart Future,” USA Today, Nov. 8,
2002, pp. 1B, 2B; and Amy Merrick,
“Turning Red Ink to Green,” The Wall
Street Journal, Oct. 15, 2002, pp. B1,
B3.
25. Jason Roberson, “Supercenter on Horizon;
When Wal-Marts Grow Up,” Dayton
Daily News, July 14, 2002, p. F1;
and Wendy Zellner, “Look Out, Supermarkets
—Wal-Mart Is Hungry,” Business
Week, Sept. 14, 1998, pp. 98, 100.
26. “Sunglass Hut Expands Its Watch Retailing
Operations,” Mergers and Acquisitions,
July 2000, pp. 10–11.
27. Gary E. Hoover, “What’s in a Store?”
Across the Board, September 1998,
pp. 11_.
etz26505_notes.qxd 4/22/03 3:36 PM Page N-14
Notes and Refe rences N-15
28. Glen Creno, “Anthem Outlet Mall
Hopes to Buck Trend,” The Arizona
Republic, Nov. 11, 2002, pp. D1, D3;
and Ray A. Smith, “Outlet Centers Go
Upmarket with Amenities,” The Wall
Street Journal, June 6, 2001, p. B12.
29. Sometimes category killers are referred
to as superstores. Using this term in
this context can create confusion, however,
because it is also applied to very
large supermarkets. “1982 to 1992:
Clubs and Category Killers Arrive on
the Scene,” DSN Retailing Today, August
2002, pp. 21–25; and Babette
Morgan, “Borders Enters Big Bookstore
Competition Here,” St. Louis
Post-Dispatch, Mar. 20, 1995, p. 3BP.
30. Mike Duff, “IKEA Eyes Aggressive
Growth,” DSN Retailing Today, Jan.
27, 2003, pp. 1, 22. “AutoNation Becomes
Largest Retailer,” Automotive
News, Oct. 21, 2002, p. 47; and “Auto
News Digest,” Automotive News, Aug.
19, 2002, p. 32.
31. William M. Bulkeley, “‘Category Killers’
Go from Lethal to Lame in the Space of
a Decade,” The Wall Street Journal,
Mar. 9, 2000, pp. A1, A8.
32. Brian O’Keefe, “Meet Your New Neighborhood
Grocer,” Fortune, May 13,
2002, pp. 93–94, 96.
33. Joel A. Baglole, “Loblaw Supermarkets
Add Fitness Clubs to Offerings,”
The Wall Street Journal, Dec. 27,
1999, p. B4; and Len Lewis, “Markets
in Motion,” Progressive Grocer, April
1999, pp. 9–14.
34. www.mobil.com, accessed Nov. 24,
2002.
35. David Koenig, “7-Eleven Toasts 75
Years with Free Slurpees,” St. Louis
Post-Dispatch, July 10, 2002, p. C7;
“Business Bulletin,” The Wall Street
Journal, Mar. 9, 2000, p. A1; and Joe
Dwyer III, “Retail Systems Group Sees
Convenience Store of Future,” St.
Louis Business Journal, Feb. 8–14,
1999, p. 32.
36. “Warehouse Format Fetes Milestone
and Makeover,” Chain Store Age, August
2002, pp. 70–72; and Shelly
Branch, “Inside the Cult of Costco,”
Fortune, Sept. 6, 1999, pp. 184–186_.
37. This estimate (perhaps better labeled a
“guesstimate”) of the total annual
volume of nonstore retailing represents
a sum of the estimates for the
five types that are discussed in subsequent
sections.
38. The sales figures are drawn from a compilation
on the website of the World
Federation of Direct Selling Associations:
www.wfdsa.org/statistics. The estimated
number of sales reps is from
survey results on the website of the Direct
Selling Association: www.dsa.org/
research/numbers.htm. For seven articles
covering various aspects of direct
selling, see the Journal of Marketing
Channels, vol. 2, no. 2, 1992.
39. www.dsa.org/research/numbers/htm.
40. Delbert Ellerton, “Joining the Party,”
St. Louis Post-Dispatch, July 21, 2002,
pp. G20–G21; and Dennis Berman, “Is
the Bell Tolling for Door-to-Door Selling?”
Business Week E.Biz, Nov. 1,
1999, pp. EB58, EB60.
41. Michael McCarthy and Jayne O’Donnell,
“FTC Idea Could Get Telemarketers
to Stop Calling,” USA Today,
June 5, 2002, pp. 1B, 2B.
42. Dana Milbank, “Telephone Sales Reps
Do Unrewarding Jobs That Few Can
Abide,” The Wall Street Journal, Sept.
23, 1993, pp. A1, A8. The estimated
cost of telemarketing fraud is from McCarthy and O’Donnell, loc. cit.
43. Yochi J. Dreazen and Jane Spencer,
“Curbing Telemarketers: FTC Moves
to Defend Your Dinner Hour,” The
Wall Street Journal, Dec. 19, 2002,
pp. D1, D2. Steven C. Bahls and Jane
Easter Bahls, “Taking Calls,” Entrepreneur,
January 2002, p. 89.
44. Michael D. Sorkin, “Vending-Machine
Sales Slump with the Economy,” St.
Louis Post-Dispatch, July 26, 2002,
pp. C1, C2.
45. Michael D. Sorkin, “Wrinkled Bills?
No Problem for Today’s Vending Machines,”
St. Louis Post-Dispatch, July
21, 2002, pp. A1, A11; Rodney Ho,
“Vending Machines Make Change,”
The Wall Street Journal, July 7, 1999,
pp. B1, B4; and “Coke Machine
Modems Send Distress Signals,” Marketing
News, Oct. 9, 1995, p. 2.
46. Donna Fuscaldo, “No Sale,” The Wall
Street Journal, Dec. 10, 2001, p. R10.
47. “Online Sales in 2001 Generated Profits
for More Than Half of All U.S. Retailers
Selling Online,” PR Newswire,
June 12, 2002.
48. Ibid.; Heather Green, “Retail: The Cart
Is Half Full,” Business Week, Jan. 13,
2003, pp. 124_. Heather Green,
“Lessons of the Cyber Survivors,” Business
Week, Apr. 22, 2002, p. 42; and
Greg Wiles, “E-tailers Are Facing
Doom, Survey Finds,” St. Louis PostDispatch, Apr. 12, 2000, p. B7.
49. “Online Sales . . . ,” loc. cit.; Katy
McLaughlin, “Back from the Dead:
Buying Groceries Online,” The Wall
Street Journal, Feb. 25, 2003, pp. D1_.
and Cristina Lourosa-Ricardo, “Picking
the Product,” The Wall Street Journal,
Nov. 22, 1999, pp. R8, R10.
50. Based on figures contained in the Economic
Impact: U.S. Direct & Interactive
Marketing Today study sponsored
by the Direct Marketing Association,
www.the-dma.org/cgi/registered/
research/libres-ecoimpact2.shtml, and
www.the-dma.org/cgi/registered/
research/charts/dmsales/medium/
market.shtml, accessed Nov. 27, 2002.
The estimated sales refer only to direct
orders, not to subsequent sales that
were based on leads and store traffic
generated by telemarketing. Although
we considered it separately, telemarketing
is sometimes included under the
umbrella of direct marketing. Another
term often associated with direct marketing,
mail order, actually refers to the
way an order is placed and/or delivered,
whereas the types we describe focus
on the way contact is made with
consumers.
51. Chad Kaydo, “Planting the Seeds of
Marketing,” Sales & Marketing Management,
August 1998, p. 73.
52. Bruce Horovitz, “You Ordered It from
Horchow? That’s Rich!” USA Today,
Dec. 2, 2002, pp. 1B, 2B; and Steve
Jarvis, “A Page-Turner,” Marketing
News, Oct. 8, 2001, p. 3.
53. Jennifer McAlister, “Nonstore: A
Growth Slowdown,” Chain Store Age,
Aug. 1, 2002, p. A28; and Sherry
Chiger, “Catalog Age 100: Behind the
Numbers,” Aug. 1, 2002, accessed at
catalogagemag.com. The number of
catalogs is drawn from Calmetta W.
Coleman, “Retailers Strive for Shopping
Synergy,” The Wall Street Journal,
Dec. 20, 1999, pp. B1, B6.
54. “Nonstore Retailing Gains Favor with
Consumers,” Chain Store Age, August
1999, pp. A29–A32.
55. A theory of institutional change, called
the wheel of retailing, was first described
in M. P. McNair, “Significant
Trends and Developments in the Postwar
Period,” in A. B. Smith, ed., Competitive
Distribution in a Free, HighLevel Economy and Its Implications
for the University, The University of
Pittsburgh Press, Pittsburgh, 1958,
pp. 17–18.
56. “Target: 40 Years of Retailing,”
Home Textiles Today, May 27, 2002,
pp. 16–17; and Gary Strauss, Lorrie
Grant, and Michael McCarthy, “Dayton
Hudson Hopes Name Change
etz26505_notes.qxd 4/22/03 3:36 PM Page N-15
N-16 Notes and Refe rences
Hits Bull’s-Eye,” USA Today, Jan. 14,
2000, p. 5B.
57. Ann Grimes, “What’s in Store,” The
Wall Street Journal, July 15, 2002,
p. R26; Nick Wingfield, “Click and . . .
Drive?” The Wall Street Journal, July
15, 2002, p. R11; and Robert Berner
and Gerry Khermouch, “Retail Reckoning,”
Business Week, Dec. 10, 2001,
pp. 72–77.
58. Jay A. Scansaroli and David M. Szymanski,
“Who’s Minding the Future?”
Retailing Issues Letter, January 2002,
pp. 1–8.
59. Pete Barlas, “Well, Doggone!” Investor’s
Business Daily, Sept. 9, 2002,
p. 5.“Petsmart.com,” Catalog Age, May
2001, p. 47; David Lewis, “As Rivals
Perish, PetsMart Increases Online Investment,”
Internetweek, Dec. 4, 2000,
p. 106; Pui-Wing Tam and Mylene
Mangalindan, “Pets.com’s Demise: Too
Much Litter, Too Few Funds,” The Wall
Street Journal, Nov. 8, 2000, p. B1; “For
Online Pet Stores, It’s Dog-Eat-Dog,”
Business Week, Mar. 6, 2000, p. 78.
Chapter 15
1. W.W. Grainger, Inc. website, investor.
grainger.com/downloads/FBpart2.pdf,
accessed Dec. 8, 2002; “Profile—
W. W. Grainger, Inc.,” biz.yahoo.com,
accessed June 10, 2002; Dale Buss,
“The New Deal,” Sales & Marketing
Management, June 2002, pp. 24–30;
“Online Parts Site Gains Popularity,”
Industrial Distribution, December
2001, p. 25; “Junk That Catalog and
Get on the Web,” Business Week, June
26, 2000, p. 28B.
2. Rich Sherman, “Wholesale Distribution
—Back in the Chain Game,” Material
Handling Management, April 2001,
pp. SCF12–SCF14; J. William Gurley,
“Why Online Distributors—Once Written
Off—May Thrive,” Fortune, Sept. 6,
1999, p. 270; and “Making the Switch
from Direct to Dealer Sales,” Nation’s
Business, July 1996, p. 10.
3. 1992 Census of Wholesale Trade, Subject
Series—Miscellaneous Subjects,
U.S. Bureau of the Census, Washington,
DC, 1995, p. 42.
4. The terms merchant wholesaler and
wholesaler are sometimes used synonymously
with wholesaling middleman.
This is not accurate, however. Wholesaling
middleman is the all-inclusive term,
covering the three major categories of
firms engaged in wholesale trade,
whereas wholesaler is more restrictive,
applying to only one category, namely,
merchant wholesaling middlemen.
5. Because manufacturers’ sales facilities
are owned by manufacturers rather
than being truly independent, they
could be viewed as a direct distribution
channel, rather than as distinct middlemen
used in indirect distribution. Although
this view has merit, we treat
manufacturers’ sales facilities as a category
of middlemen because the Census
Bureau does and also because they
are separate from manufacturing firms
by location, if not by ownership.
6. Donald M. Jackson and Michael F.
d’Amico, “Products and Markets
Served by Distributors and Agents,”
Industrial Marketing Management,
February 1989, p. 28.
7. 1997 Economic Census, Wholesale
Trade, Geographic Area Series, U.S.
Census Bureau Washington, DC, 2000,
p. United States 7, www.census.gov/
prod/ec97/97w42-US.pdf; and corresponding
censuses from prior years.
For a comprehensive historical analysis
of wholesaling, see Robert F. Lusch,
Deborah Zizzo, and James M. Kenderine,
Foundations of Wholesaling: A
Strategic and Financial Chart Book,
Distribution Research Program, University
of Oklahoma, Norman, 1996.
8. Average operating expenses in this
paragraph and the following one are
based on the 1992 Census of Wholesale
Trade, Geographic Area Series—
U.S., U.S. Bureau of the Census, Washington,
DC, 1995, p. US-9; and the
1992 Census of Retail Trade, Subject
Series, U.S. Bureau of the Census,
Washington, DC, 1996, p. 2–7. The
8% figure was calculated by multiplying
the 11% representing wholesale
operating expenses by 72%. The remainder
after the 28% representing retail
operating expenses is subtracted
from the 100% representing retail sales
(or the consumer’s dollar).
9. www.supervalu.com/home, accessed on
Mar. 14, 2002. For an overview of the
challenges faced by a competing fullservice
wholesaler, the Fleming Companies,
see Thaddeus Herrick and Amy
Merrick, “End of Kmart Deal Imperils
Fleming,” The Wall Street Journal,
Feb. 5, 2003, p. B5.
10. Lara L. Sowinski, “Skechers Puts Its Best
Foot Forward,” World Trade, November
2001, pp. 34–36; and Jeffrey A. Tannenbaum,
“Cold War: Amana Refrigeration
Fights Tiny Distributor,” The Wall
Street Journal, Feb. 26, 1992, p. B2.
11. Karen Jacobs, “Electronics Distributors
Are Reporting Record Profits,”
The Wall Street Journal, July 13,
2000, p. B4. For recommendations on
how wholesalers can compete effectively
with chains of category-killer
stores and warehouse clubs that tend
to buy directly from manufacturers,
see Robert F. Lusch and Deborah
Zizzo, Competing for Customers, Distribution
Research and Education
Foundation, Washington, DC, 1995,
pp. 80–108.
12. Faith Keenan, “Logistics Gets a Little
Respect,” Business Week E.Biz, Nov.
20, 2000, pp. EB114–EB115.
13. To gain insight into financial and operating
statistics for U.S. and Canadian
wholesalers, see Lusch, Zizzo, and
Kenderine, loc. cit.
14. Jacobs, loc. cit.
15. 1997 Economic Census, Wholesale
Trade, loc. cit.; and corresponding censuses
from prior years.
16. U.S. Economic Census data for 1997,
located at factfinder.census.gov/servlet/
EconSectorServlet?_Sectorld_42&_
lang_en.
17. Ibid.
18. Charles Shaw, “The Rep and the Future
—Which Is Now,” Agency Sales,
January 2001, pp. 28–30; and Melissa
Campanelli, “Agents of Change,” Sales
& Marketing Management, February
1995, pp. 71–75.
19. U.S. Economic Census data for 1997,
loc. cit.
20. The Internet Auction List website,
www.internetauctionlist.com, accessed
on Dec. 8, 2002.
21. Lisa H. Harrington, “Logistics Costs:
Good News and Bad,” Transportation
& Distribution, July 2002, p. 9; and
Charles Haddad, “A Long Haul to Recovery?”
Business Week, Jan. 14, 2002,
p. 118. The estimate of worldwide
spending is from Bill Fahrenwald, “Supply
Chain: Managing Logistics for the
21st Century,” Business Week, Dec. 28,
1998, p. 45. The cost of logistics to an individual
firm was estimated by the head
of the North American Logistics Association,
as reported in Francis J. Quinn,
“Logistics’ New Customer Focus,” Business
Week, Mar. 10, 1997, p. 54.
22. Jon Bigness, “In Today’s Economy,
There Is Big Money to Be Made in Logistics,”
The Wall Street Journal, Sept.
6, 1995, pp. A1, A9.
23. Bill McIlvaine, “Going After Value—
Logistics Providers Are Offering More
Complex Services to Increasingly Demanding
Customers,” EBN, Feb. 25,
2002, pp. 27_. For a discussion of how
etz26505_notes.qxd 4/22/03 3:36 PM Page N-16
Notes and Refe rences N-17
firms can achieve a differential advantage
through superior physical distribution,
see Donald W. Bowersox, John T.
Mentzer, and Thomas W. Speh, “Logistics
Leverage,” Journal of Business
Strategies, Spring 1995, pp. 36–49.
24. Bruce G. Posner, “Growth Strategies,”
Inc., December 1989, p. 125.
25. Natalie Hope McDonald, “Under One
Roof,” Dealerscope, July 2002, p. 16;
and Faith Keenan, “Warehouse Trouble,”
Business Week E.Biz, Nov. 20,
2000, pp. EB125–EB126. The quote is
from George Anders, “Virtual Reality:
Web Firms Go on Warehouse Building
Boom,” The Wall Street Journal, Sept. 8,
1999, pp. B1, B8. For more about online
category managers, see Bob Sechler,
“Behind the Curtain,” The Wall
Street Journal, July 15, 2002, p. R12;
and Sandeep Dayal, Thomas D. French,
and Vivek Sankaran, “The E-tailer’s Secret
Weapon,” The McKinsey Quarterly,
2002, no. 2, no pages given, accessed
at www.mckinseyquarterly.com
on Dec. 8, 2002.
26. Karen Lundergaard, “Bumpy Ride,”
The Wall Street Journal, May 21,
2001, p. R21.
27. Fahrenwald, op. cit., p. 34; and Lundergaard,
loc. cit.
28. “Year of the 3PLs,” Journal of Commerce,
Feb. 18, 2002, p. 12; and McIlvaine,
loc. cit.
29. The motives for contract logistics are
drawn from Quinn, op. cit., p. 69.
30. Alorie Gilbert, “GM Joint Venture to
Track In-Transit Inventory,” InformationWeek,
Dec. 18–25, 2000, p. 26;
and Daniel Machalaba and Karen Lundegaard,
“CNF, GM Plan to Form Logistics
Venture to Manage Flow of Vehicle
Deliveries,” The Wall Street
Journal, Dec. 14, 2000, p. A6.
31. “Outsourcing of Logistics Is Globally
Recognized as a Primary Business Strategy
with Significant Value, According to
New Study,” Business Wire, Sept. 30,
2002, no pages given; John Dizard,
“The Logistics of Delivering Growth
Strategies,” Financial Times, Jan. 25,
2002, p. 24; McIlvaine, loc. cit.; and
“Outsourcing to Drive Growth in Contract
Logistics Market,” Logistics Focus,
September 1997, p. 16.
32. Cinda Becker, “An Industry Barometer,”
Modern Healthcare, June 18,
2001, pp. 80–84; and Tom Murray,
“Just-in-Time Isn’t Just for Show—It
Sells,” Sales & Marketing Management,
May 1990, p. 64.
33. McIlvaine, loc. cit.
34. John W. Verity, “Clearing the Cobwebs
from the Stockroom,” Business Week,
Oct. 21, 1996, p. 140.
35. Heidi Elliott, “Delivering Competition,”
Electronic Business Today, May
1997, pp. 34–36; and Ronald Henkoff,
“Delivering the Goods,” Fortune, Nov.
28, 1994, pp. 64_.
36. Richard Karpinski, “Wal-Mart
Pushes Web EDI,” B to B, Oct. 14,
2002, p. 15; and Amy Zuckerman,
“Should You Do EDI or Internet?”
Transportation & Distribution, June
1999, pp. 40–42.
37. www.covisint.com, accessed on Dec.
10, 2002; David Hannon, “Aircraft
Manufacturer Takes E-Buying Bull by
the Horns,” Purchasing, Sept. 20,
2001, pp. S16–S19; and Robert L.
Simison, Fara Warner, and Gregory L.
White, “Big Three Car Makers Plan
Net Exchange,” The Wall Street Journal,
Feb. 28, 2000, pp. A3, A16.
38. Art Raymond, “Is JIT Dead?” FDM,
January 2002, pp. 30–33. For further
discussion of JIT, see Marvin W. Tucker
and David A. Davis, “Key Ingredients
for Successful Implementation of JustinTime: A System for All Business
Sizes,” Business Horizons, May–June
1993, pp. 59–65; and Gary L. Frazier,
Robert E. Spekman, and Charles R.
O’Neal, “Just-in-Time Exchange Relationships
in Industrial Markets,” Journal
of Marketing, October 1988,
pp. 52–67.
39. Paulette Thomas, “Electronics Firm
Ends Practice Just in Time,” The Wall
Street Journal, Oct. 29, 2002, p. B9;
William Atkinson, “Does JIT II Still
Work in the Internet Age?” Purchasing,
Sept. 6, 2001, pp. 41–42; and
Fred R. Bleakley, “Some Companies
Let Suppliers Work on Site and Even
Place Orders,” The Wall Street Journal,
Jan. 13, 1995, pp. A1, A6. Implications
of JIT for channels are discussed
in Steve McDaniel, Joseph G.
Ormsby, and Alicia B. Gresham, “The
Effect of JIT on Distributors,” Industrial
Marketing Management, May
1992, pp. 145–149.
40. James A. Cooke, “What’s Behind the
Curtain?” Logistics Management, July
2002, pp. 46–50; Debbie Howell, “12
Hot Issues Facing Mass Retailing—6:
Supply-Chain Management,” DSN Retailing
Today, May 20, 2002, p. 33; Jane
Hodges, “Supply Chain CEOs,” Chief
Executive, January 2002, pp. 65–66;
and Joseph Weber, “Just Get It to the
Stores on Time,” Business Week, Mar. 6,
1995, pp. 66–67.
41. Brian Albright, “CPFR’s Secret Benefit,”
Frontline Solutions, October 2002,
pp. 30–35.
42. “Vendors Complete CPFR Interoperability
Tests,” Transportation & Distribution,
October 2002, p. 18; Carol
Sliwa, “CPFR Clamor Persists, but
Adoption Remains Slow,” Computerworld,
July 1, 2002, p. 10; Penelope
Ody, “Sharing Data Is Just the Beginning
of the Process,” Financial Times,
Sept. 1, 1999, p. VI; and John Verity,
“Collaborative Forecasting: Vision
Quest,” Computerworld, Nov. 10,
1997, pp. S12–S14.
43. Rod Newing, “Industry Is About to
Reinvent Itself,” Financial Times, Dec.
15, 1999, p. I.
44. “Supply Chain: Keeping It Moving,”
Chain Store Age, October 2002,
pp. A26–A28.
45. For case studies about the design of
distribution centers by two diverse
companies, Jo-Ann Fabrics and Corporate
Express, see Mary Aichlmayr,
“Design Your Distribution Center Inside
Out,” Transportation & Distribution,
November 2002, p. 30.
46. Nintendo’s distribution center is detailed
in “Nintendo Enhances Performance
Conveyor Sortation,” Material Handling
Management, October 2001, pp. 47–51;
and Michael Lear-Olimpi, “More than
Just Games,” Warehousing Management,
September 1999, pp. 22–30.
47. Robert D. Hof, “What’s with All the
Warehouses?” Business Week e.biz,
Nov. 1, 1999, p. EB88.
48. Nick Wingfield, “Iship.com Hopes to
Make Shipping Simpler for E-Stores,”
The Wall Street Journal, Sept. 2, 1999,
p. B6; and Ken Cottrill, “A Way to
Lower Shipping Costs,” Nation’s Business,
December 1998, pp. 33–34.
49. For research results indicating that perceptions
of different modes vary across
members of a buying center, see James H.
Martin, James M. Daley, and Henry B.
Burdg, “Buying Influences and Perceptions
of Transportation Services,” Industrial
Marketing Management, November
1988, pp. 305–314.
50. Charles Haddad, “Transportation: Sharing
the Load,” Business Week, Jan. 13,
2003, pp. 125–126; Philip Siekman,
“New Hope for Trucks and Trains,”
Fortune, Dec. 24, 2001, pp. 144[B]_;
Robert Johnson, “Record Number of
Small Trucking Firms Are Folding,”
The Wall Street Journal, June 25, 2001,
pp. A2, A8; and Daniel Machalaba,
“Delays and Snafus Grip Rail Freight,”
etz26505_notes.qxd 4/16/03 12:55 PM Page N-17
N-18 Notes and Refe rences
The Wall Street Journal, May 29, 1998,
pp. B1, B2.
51. Daniel Machalaba, “Railroads May
Get More Money from Shipping Consumer
Goods,” The Wall Street Journal,
Sept. 19, 2002, p. B4; and Sarah
Stone, “Intermodal at Global Watershed
Point,” Purchasing, May 20,
1999, pp. 103–105.
52. Joseph Weber, Seth Payne, Kevin Kelly,
and Stephanie A. Forest, “The Great
Train Turnaround,” Business Week,
Nov. 2, 1992, pp. 56–57; and Sally
Solo, “Every Problem Is an Opportunity,”
Fortune, Nov. 16, 1992, p. 93.
53. Anna Wilde Mathews, “More Firms
Rely on ‘One-Stop’ Shipping,” The Wall
Street Journal, Apr. 29, 1997, p. A2.
54. The statement by the Yellow Corp. executive
is from Haddad, “A Long Haul
to Recovery?” loc. cit. Charles Haddad,
“FedEx: Gaining on the Ground,” Business
Week, Dec. 16, 2002, pp. 126_;
and “The Man Who’s Repackaging
UPS,” Business Week, June 3, 2002,
p. 30B.
55. “Grainger Retreats, Closes Material
Logic,” Industrial Distribution, June
2001, pp. 19–20; Kevin Knapp,
“Grainger Defends Move; Says OrderZone Equity Swap a Wise Decision,” B
to B, July 3, 2000, p. 6; Buss, loc. cit.;
“Online Parts Site Gains Popularity,”
loc. cit.; and “Junk That Catalog and
Get on the Web,” loc. cit.
Chapter 16
1. Company brochures; company website,
www.aflac.com, accessed on January 24,
2002; “Best Marketing Icon: AFLAC’s
Duck,” Sales & Marketing Management,
September 2001, p. 32; Bethany
McLean, “Duck and Coverage,” Fortune,
Aug. 13, 2001, pp. 142–143.
2. Rhea Seymour, “Ideas that Work,”
Profit, June 2002, pp. 66_.
3. Geoff Mulvihill, “Campbell’s Earnings
Slip Along with Business News,” Associated
Press Business News, Feb. 13,
2002.
4. “The 100 Leaders,” Advertising Age,
Sept. 24, 2001, pp. S19_.
5. This is a condensed version of the definition
offered by Don E. Shultz and Heidi
F. Shultz, “Transitioning Marketing
Communications into the Twenty-First
Century,” Journal of Marketing Communications,
March 1998, pp. 9–26.
6. Kate Henry, “Krafting a Retail Return,”
Point of Purchase, March 2002,
pp. 22_; Courtney Kane, “Will the
Magic of E.T. Work Again?” The New
York Times, Mar. 22, 2002, p. 2; Libby
Estill, “Promos Phone Home,” Incentive,
February 2002, p. 62.
7. Russ Green, “Making Measuring Simple:
Plan Marcomm, Evaluate Criteria,”
Advertising Age’s Business Marketing,
September 1999, p. 49.
8. Steve Caulk, “Recruiters See Army of
Potential at Speedway,” Rocky Mountain
News, July 18, 2002, p. 4B.
9. Stephanie Fagnani, “On the Road
Again,” Brandmarketing, April 2002,
p. 12_.
10. “The State of Couponing,” Brandmarketing,
April 2002, pp. 8_.
11. Julie Mitchell, “Customized Clothing
Sites Aim for Perfect Shoe Fit,” Investor’s
Business Daily, Mar. 6, 2002,
pp. 6_.
12. R. Kevin Dietrich, “Columbia, S.C.–
Based Insurance Company to Launch
TV Ad Campaign Next Year,” The
State (Columbia, SC), Oct. 11, 2001;
Bethany McLean, loc. cit.
Chapter 17
1. David Drickhamer, “Peak Performance,”
Industry Week, May 21,
2001; “America’s 25 Best Sales
Forces,” Sales & Marketing Management,
July 2000, pp. 57–85; “Answer
to ‘Who Sits Where?’ Question, Others
Like It Give Johnson Controls a
Competitive Edge in Innovation, PR
Newswire, Jan. 6, 2002; company
website, www.johnsoncontrols.com,
accessed on Apr. 11, 2002; Andy Cohen,
“In Control,” Sales & Marketing
Management, June 1999, pp. 32–38;
Robert Sherefkin, “GM Seat Deal
Would Create New Player,” Automotive
News, Aug. 2, 1999, p. 1; Mark
Savage, “Johnson Controls, Lego
Team Up with Play Seat,” Milwaukee
Journal Sentinel, Jan. 4, 1999, p. 3;
Mark Savage, “Johnson Controls Expects
Auto Unit to Grow Rapidly,”
Milwaukee Journal Sentinel, Jan. 28,
1999, p. 1.
2. Statistical Abstract of the United
States, 2001, 121st ed., U.S. Bureau of
the Census, Washington, DC, 2001,
pp. 380–382.
3. Several sales job classification schemes
have been proposed over the years. See
for example: Derek A. Newton, Sales
Force Performance and Turnover, Marketing
Science Institute, Cambridge,
MA, 1973.
4. William C. Moncrief, “Selling Activity
and Sales Position Taxonomies for
Industrial Salesforces,” Journal of
Marketing Research, August 1986,
pp. 261–270.
5. Greg W. Marshall, William C. Moncrief,
and Felicia G. Lassk, “The Current
State of Sales Force Activity,” Industrial
Marketing Management 28,
no. 1, 1998, pp. 87–98.
6. Leonard Berry, On Great Service, The
Free Press, New York, 1995.
7. Michele Marchetti, “What a Sales Call
Costs,” Sales & Marketing Management,
September 2000, pp. 80_. The
figures are derived from a study commissioned
by S&MM magazine and
are reported by type of sales approach,
industry, size of company, and region.
8. To learn more about how online auctions
work visit the website www.
freemarkets.com. To find out about
other auction sites go to www.
internetb2blist.com.
9. David Prater, “The Third Time’s the
Charm,” Sales & Marketing Management,
September 2000, pp. 101–104.
10. David Prater, “5 Steps to Salvaging a
Failing SFA Program,” Sales & Marketing
Management, September 2000,
p. 102.
11. “Get Plugged In,” Sales & Marketing
Management, March 1999, p. 33.
12. For a discussion of efforts to identify
characteristics of successful sales people,
see Mark W. Johnston and Greg W.
Marshall, Sales Force Management,
McGraw-Hill/Irwin, Burr Ridge, IL,
2003, Chap. 8.
13. Rekha Balu, “Whirlpool Gets Real
with Customers,” Fast Company, December
1999, pp. 74–76.
14. For more details on training practices,
see Christine Galea, “2002 Sales Training
Survey,” Sales & Marketing Management,
July 2002, pp. 34–37.
15. Recent examples include Becky Meiser,
“Show Them the Money,” Sales &
Marketing Management, April 2002,
p. 66; Mark McMaster, “The Drive to
Strive,” Sales & Marketing Management,
April 2002, p. 67; Christine
Galea, “2002 Salary Survey,” Sales &
Marketing Management, May 2002,
pp. 32–36.
16. John Taylor, “Program to Examine
Kirby Sales Tactics,” Omaha WorldHerald, Apr. 4, 2002, p. 2D.
17. Ted Evanoff, “Concerns Cloud the Future
of Web Auto Parts Network,” Indianapolis
Star, June 6, 2001; Ralph
Kisiel, “Many Suppliers Still Not Sold
in Virtues of Using Covisint,” Crain’s
etz26505_notes.qxd 4/16/03 12:55 PM Page N-18
Notes and Refe rences N-19
Detroit Business, Sept. 3, 2001, p. 13;
“Covisint Posts Gains in Web-Auction
Business,” The Wall Street Journal,
Aug. 13, 2001, p. A6.
Chapter 18
1. www.almaco.cc/industry.htm; Hillary
Chura and David Goetzl, “Royal
Caribbean Christens New Baby Boomer
Effort,” Advertising Age, Jan. 17, 2000;
David Goetzl, “Cruise Industry Profits
Sink,” Advertising Age, Nov. 12, 2001;
Spud Hilton, “Behind the Building
Boom: A Flotilla of New Ships Means
New Choices—and Sometimes Bargains,”
San Francisco Chronicle,
Apr. 22, 2001, p. T12; Theresa Norton
Masek, “Adventure in the Big
Apple,” Travel Age West, Dec. 3,
2001, p. 52; Paula Dobbyn, “U.S.
Travel Industry Executives Launch
International Marketing Campaign,”
Anchorage Daily News, July 24,
2001; Martha Brannigan, “Cruise
Lines Go Online—to Tout Travel
Agencies,” The Wall Street Journal,
Aug. 23, 2001, p. B1; Charles Fishman,
“Fantastic Voyage,” Fast Company,
March 2000, pp. 170–200; www.voyageroftheseas.
com/index.html, accessed
on Mar. 4, 2002.
2. Laurel Wentz, “P&G Tops $3 Billion
Mark in Non–U.S. Ad Spending,” Advertising
Age, Nov. 8, 1999, p. 12.
3. “Revenue per Advertising Dollar Expenditure,”
AdAge.Com, www.adage.
com/page.cms?pageId_915, Aug. 31,
2002, pp. 1–4.
4. Suzanne Vranica, “That Guy Showing
Off His Hot New Phone May Be a
Shill,” The Wall Street Journal, July 31,
2002, pp. B1_.
5. William M. Bulkeley, “Pass It On,”
The Wall Street Journal, Jan. 14, 2001,
pp. R6_.
6. Betty Lui, “Coca-Cola Aims to Recapture
the Real Thing,” Financial Times,
Jan. 14, 2000, p. 19; Patti Summerfield,
“Global Advertising Isn’t Always the
Best Strategy,” Strategy, Apr. 22, 2002,
pp. 1_.
7. Christine Bittar, “Advertising Campaigns:
Avon Products, Inc.” Brandweek,
Feb. 18, 2002, p. 4.
8. Katarzyna Moreno, “UnbeComing,”
Forbes, June 10, 2002, pp. 151–152;
Christine Bittar, “Avon Causes in the
Pink: Kissing Cancer Goodbye with
Color, Concerts,” Brandweek, June 3,
2002, p. 26.
9. Examine an issue in your local newspaper.
Notice that different retailers
feature the same item (supermarkets
offer 7-Up at the same time or furniture
stores offer the same lounge
chair). This is a sign that co-op funds
are being used to pay for the ads.
10. Kathryn Kranhold, “Taco Bell Ads to
Focus on Food, Not Dog,” The Wall
Street Journal, Oct. 11, 1999, p. B10.
11. “Broadcast TV,” 2002 Media Fact
Book: A Guide to Competitive Media,
Radio Advertising Bureau, www.rab.
com, accessed Sept. 1, 2002.
12. “Cable TV,” 2002 Media Fact Book: A
Guide to Competitive Media, Radio
Advertising Bureau, www.rab.com, accessed
Sept. 1, 2002.
13. “Direct Mail,” 2002 Media Fact Book:
A Guide to Competitive Media, Radio
Advertising Bureau, www.rab.com, accessed
Sept. 1, 2002.
14. Ibid.
15. Ibid.
16. “Newspapers,” 2002 Media Fact
Book: A Guide to Competitive Media,
Radio Advertising Bureau, www.rab.
com, accessed Sept. 1, 2002.
17. “Yellow Pages,” 2002 Media Fact
Book: A Guide to Competitive Media,
Radio Advertising Bureau, www.rab.
com, accessed Sept. 1, 2002.
18. “Magazines,” 2002 Media Fact Book:
A Guide to Competitive Media, Radio
Advertising Bureau, www.rab.com, accessed
Sept. 1, 2002.
19. “Outdoor,” 2002 Media Fact Book: A
Guide to Competitive Media, Radio
Advertising Bureau, www.rab.com, accessed
Sept. 1, 2002.
20. Jean Halliday, “Ford Finds E-leads
Productive,” Advertising Age, Jan. 22,
2001, pp. 28_.
21. Nancy J. Wagner, “Picking a Medium
for Your Message” Nations Business,
February 1999, pp. 56–57.
22. Scot Hume, “Trade Promos Devour
Half of All Marketing $,” Advertising
Age, Apr. 13, 1992, p. 3.
23. “Introduction: A Half-Full Glass,”
PROMO 2002 Annual Report, June 1,
2002, accessed on the website www.
promo.com/ar on Sept. 1, 2002.
24. Libby Estell and Jeanie Casison, “Sampling
Sells: A Marketing Strategy that
Motivates Consumers,” Incentive, August
2002, p. 6.
25. Kitty Bean Yancey, “Luxury Hotel
Perks Put Guests in the Driver’s Seat,”
USA Today, June 7, 2002, p. 9D.
26. Allison Wellmer, “Try It—You’ll Like
It,” American Demographics, August
1998, pp. 42_.
27. “Coupons: Wing Clipping,” PROMO
2002 Annual Report, June 1, 2002, accessed
on the website www.promo.
com/ar on Sept. 1, 2002.
28. Ibid.
29. “Sponsorship Spending in North America,”
IEG Sponsorship Report, accessed
on the webstie www.sponsorship.
com/learn/northamericaspending, accessed
on Sept. 4, 2002.
30. “Business Bulletin,” The Wall Street
Journal, Feb. 24, 2000, p. A1.
31. Harvey Meyer, “And Now, Some
Words about Sponsors,” Nation’s
Business, March 1999, pp. 38_.
32. Shawn Doonan and Matthew Garrahan,
“Reebok Quits as Olympic Sponsor,”
Financial Times, Dec. 9, 1999, p. 8.
33. William Dunn, “On with the Show,”
Marketing Tools, July/August 1995,
pp. 46–55.
34. Martha Brannigan, loc. cit.; “Cruise
Week Annual Survey: And How Do
You Like the Cruise Lines?” Cruise
Week News, Jan. 3, 2001, accessed at
www.cruiseweek.com on July 17, 2001;
www.royalcaribbean.com.
Chapter 19
1. www.starbucks.com/aboutus, accessed
June 15, 2002; Michael Krauss,
“Starbucks Adds Value by Taking on
Wireless,” Marketing News, Feb. 3,
2003, p. 9; Stanley Holmes, “Planet
Starbucks,” Business Week, Sept. 9,
2002, pp. 100–103_; Shirley Leung,
“Starbucks May Indeed Be a Robust
Staple,” The Wall Street Journal, July
26, 2002, p. B4; Greg W. Prince,
“Starbucks Pours on Clubby Feeling,”
St. Louis Post-Dispatch, May
28, 2002, pp. C1, C8; Jacqueline Doherty,
“Make It Decaf,” Barron’s,
May 20, 2002, pp. 20–21; Helen
Jung, “Starbucks’ Card Smarts,”
Business Week, Mar. 18, 2002, p. 14;
George Anders, “Starbucks Brews a
New Strategy,” Fast Company, August
2001, pp. 144–146; Nelson D.
Schwartz, “Still Perking after All
These Years,” Fortune, May 24,
1999, pp. 203–210; Tim Moran,
“How Starbucks Plunged into Grocery
Competition,” Supermarket
News, Apr. 19, 1999, p. 55; David
Benady and Lucy Killgren, “Caffeine
Hits,” Marketing Week, May 7,
1998, pp. 28–29; “Making Customers
Come Back for More,” Foretz26505_
notes.qxd 4/16/03 12:55 PM Page N-19
N-20 Notes and Refe rences
tune, Mar. 16, 1998, p. 156[L]; and
Ingrid Abramovitch, “Miracles of Marketing,”
Success, April 1993, pp. 22–27.
2. Many writers and executives use the
terms control and evaluation synonymously.
We distinguish between them.
To speak of control as only one part of
the management process is too restrictive.
Rather than being an isolated
managerial function, control permeates
virtually all other organizational
activities. For example, management
controls its operations through the
goals and strategies it selects. Also, the
type of organizational structure used in
a marketing department determines
the degree of control over marketing
operations.
3. Derek F. Abell, “Strategic Windows,”
Journal of Marketing, July 1978,
pp. 21–26.
4. www.ecompanystore.com., accessed
Aug. 12, 2002; and Rodney Ho, “Forsaking
Sentiment, Small Clients, a Business
Grows,” The Wall Street Journal,
Jan. 3, 2000, pp. A11, A13.
5. www.davelennox.com, accessed Aug.
12, 2002.
6. Danny Fortson, “Planet Hollywood
Goes Bankrupt Again,” The Daily
Deal, Oct. 19, 2001, no pages given;
and Richard Gibson, “Fame Proves
Fleeting at Planet Hollywood as Fans
Avoid Reruns,” The Wall Street Journal,
Oct. 7, 1998, pp. A1, A6.
7. The survey results are reported in Ellen
Neuborne, “Mad Ave: A Star Is Reborn,”
Business Week, July 26, 1999,
pp. 54–56_. For more on changing attitudes
toward strategic planning, see
John A. Byrne, “Strategic Planning,”
Business Week, Aug. 26, 1996,
pp. 46–52.
8. C. K. Prahalad, “Changes in the Competitive
Battlefield,” Financial Times—
FT.com, Aug. 7, 2002, no pages given.
9. Michael A. O’Neil, “A Simple, Effective
Approach to the Strategic Planning
Process,” Supervision, March 2001,
pp. 3–5.
10. Dan Morse, “Many Small Businesses
Don’t Devote Time to Planning,” The
Wall Street Journal, Sept. 7, 1999,
p. B2; and Pulse of the Middle Market
—1990, BDO Seidman, New
York, 1990, pp. 12–13.
11. For one approach to competitive
analysis, see Bruce H. Clark, “Managing
Competitive Interactions,”
Marketing Management, Fall/Winter
1998, pp. 8–20. For more about the
consultants’ recommended reflection
process, see Michael Hammer and
Steven A. Stanton, “The Power of Reflection,”
Fortune, Nov. 24, 1997,
pp. 291_.
12. For more details, see Lili Vianello,
“S.W.O.T. Analysis: Plan for Your
Business to Be Successful,” Columbia
Business Times, Aug. 3–16, 2002,
p. 36.
13. www.radioshackcorporation.com, accessed
Aug. 13, 2002; and Stephanie
Anderson Forest, “Cable, Phone, Internet
. . . Who Ya Gonna Call?” Business
Week, Mar. 1, 1999, pp. 64, 66.
14. Malcolm H. B. McDonald, “Ten Barriers
to Marketing Planning,” The Journal
of Business and Industrial Marketing,
Winter 1992, p. 15.
15. Joel A. Baglole, “Cough Syrup Touts
‘Awful’ Taste in U.S.,” The Wall Street
Journal, Dec. 15, 1999, p. B10.
16. Christopher Wanjek, “It’s Not Easy
Being Clean,” The Washington Post,
Oct. 3, 2000, p. Z6; and “Stacy
Kravetz, “Dry Cleaners’ New Wrinkle:
Going Green,” The Wall Street Journal,
June 3, 1998, pp. B1, B15.
17. Differential advantage in the context of
services and retail industries is examined
in, respectively, Sundar G. Bharadwaj,
P. Rajan Varadarajan, and John
Fahy, “Sustainable Competitive Advantage
in Service Industries: A Conceptual
Model and Research Proposition,”
Journal of Marketing, October 1993,
pp. 83–99; and Norman H. McMillan,
“EST Retailing: How to Stay out of the
Black Hole,” International Trends in
Retailing, Winter 1993, pp. 60–75.
Nordstrom’s financial results were obtained
from about.nordstrom.com/
aboutus/investor, accessed Dec. 22,
2002.
18. The information about relative size
was provided in an e-mail message by
Dennis O’Reilly, treasurer of Midwest
Express Airlines, on Dec. 20, 2002.
David Leonhardt, “Big Airlines Should
Follow Midwest’s Recipe,” Business
Week, June 28, 1999, p. 40.
19. Marcia Stepanek, “How Fast Is Net
Fast?” Business Week E.Biz, Nov. 1,
1999, pp. EB52–EB54. An excellent
source of information on how various
companies prepare their marketing
plans is Howard Sutton, The Marketing
Plan, The Conference Board, New
York, 1990.
20. One of many guidebooks for preparing
an annual marketing plan is Roman G.
Hiebing, Jr., and Scott W. Cooper, The
Successful Marketing Plan, brief edition,
NTC/Contemporary Publishing
Group, Lincolnwood, IL, 2000.
21. See H. Igor Ansoff, The New Corporate
Strategy, Wiley, New York, 1988,
pp. 82–85. In this update discussion,
Ansoff substituted the term mission for
market in the matrix. We still prefer,
and thus retain, the original term.
22. Jeff Bailey, “Reliance on a Few Big
Customers Holds Risks,” The Wall
Street Journal, July 30, 2002, p. B5;
and Martha Brannigan, “Cruise Lines
Look to the Land to Get Boomers on
Board,” The Wall Street Journal, Dec.
6, 1999, p. B4.
23. Julia Boorstin, “Why Is Wrigley So
Wrapped Up?” Fortune, March 3, 2003,
pp. 133–134. Janet Ginsburg, “Not the
Flavor of the Month,” Business Week,
Mar. 20, 2000, p. 128; and “Targeting
Customer Needs Unveils New Opportunities,”
Nation’s Business, September
1998, p. 12.
24. Bill Virgin, “Straying Too Far Can
Make Diversification Fail,” The Seattle
Post-Intelligencer, Aug. 27, 2001,
p. E1.
25. www.lizclaiborne.com/lizinc/careers/
alt_corpinfo?brands.asp, accessed on
Aug. 13, 2002; and Teri Agins, “Claiborne
Patches Together an Empire,”
The Wall Street Journal, Feb. 2, 2000,
pp. B1, B4.
26. Rajesh K. Chandy and Gerard J. Tellis,
“Organizing for Radical Product Innovation:
The Overlooked Role of Willingness
to Cannibalize,” Journal of
Marketing Research, November 1998,
pp. 474_.
27. The Experience Curve Reviewed: IV.
The Growth Share Matrix of the Product
Portfolio, Boston Consulting Group,
Boston, 1973.
28. Jay Palmer, “Taking Off the White
Gloves,” Barron’s, Apr. 1, 2002, p. 19.
29. Sara Ellison and Suzanne Vranica,
“Campbell Warms Campaign to Heal
Soup Sales,” The Wall Street Journal,
Dec. 26, 2002, p. A10. William C.
Symonds, “The Big Trim at Gillette,”
Business Week, Nov. 8, 1999, p. 42.
30. Martin Peers, “A New Pitch at Blockbuster:
Buy This Movie,” The Wall
Street Journal, Nov. 1, 2002, pp. B1, B4;
and Stephanie Anderson Forest, “Blockbuster:
The Sequel,” Business Week,
Sept. 16, 2002, pp. 52–53.
31. Nick Roskelly, “Balancing Act: Pursuing
New Product Launches While Supporting
Core Brands,” Beverage Industry,
October 2002, pp. 96_; and Kenneth
etz26505_notes.qxd 4/16/03 12:55 PM Page N-20
Notes and Refe rences N-21
Hein, “New Agers Steal Cola’s Hearts,”
Brandweek, June 4, 2001, p. S34.
32. Discussed in Derek F. Abell and John S.
Hammond, Strategic Marketing Planning,
Prentice Hall, Englewood Cliffs,
N.J., 1979.
33. Michael Ryan, “Kodak’s Big Moment—
From Technology Laggard to Innovator
Again,” Ziff Davis Smart Business for
the New Economy, July 1, 2001, p. 79;
and Lee Gomes, “Silicon Graphics Sets
Designs to Ride High-End Computer
Line to Turnaround,” The Wall Street
Journal, Nov. 15, 1999, p. B6.
34. Ryan, loc. cit.; and Laurie Freeman,
“Shooting for Share,” Supermarket
Business, February 1999, pp. 47_.
35. “Dwindling Ranks,” Automotive News,
Apr. 30, 2001, p. 4; and Kathleen Kerwin,
“Reviving GM,” Business Week,
Feb. 1, 1999, pp. 114–120, 122.
36. Paul Lukas, “The Ghastliest Product
Launches,” Fortune, Mar. 16, 1998,
p. 44.
37. Bob Garrison, “Building on Success,”
Refrigerated & Frozen Foods, April
2002, pp. 20_; Andrew EdgecliffeJohnson, “Kraft Looks for More Purchases,”
Financial Times—FT.com,
Sept. 3, 2001, no pages given; and Steven
Lipin and Yumiko Ono, “Philip Morris’s
Bakery Unit Is for Sale; Asking Price Is
Put at about $1 Billion,” The Wall Street
Journal, July 17, 1995, p. A3.
38. Improvements worth considering are
suggested in the following articles: R. A.
Proctor and J. S. Hassard, “Towards a
New Model for Product Portfolio
Analysis,” Management Decision, vol.
28, no. 3, 1990, pp. 14–17; and Rick
Brown, “Making the Product Portfolio
a Basis for Action,” Long Range Planning,
February 1991, pp. 102–110.
39. Michael Treacy and Fred Wiersema,
“How Market Leaders Keep Their
Edge,” Fortune, Feb. 6, 1995,
pp. 88–90_; their ideas are fully described
in Michael Treacy and Fred
Wiersema, The Discipline of Market
Leaders, Addison-Wesley, Boston,
1995.
40. For more about Nike’s comeback, see
Stanley Holmes, “How Nike Got Its
Game Back,” Business Week, Nov. 4,
2002, pp. 129_; and Chuck Stogel,
“It’s Easier Being Green (If You’re
Nike),” Brandweek, Jan. 28, 2002,
pp. 116–118_. For an overview of the
strategic shift Jupiter Networks Inc.
had to make, see Ben Elgin, “Why
Jupiter Must Branch Out,” Business
Week, July 1, 2002, pp. 95–96.
41. Business description of Starbucks Corporation
from Multex.com, accessed
June 15, 2002; “Starbucks, Pepsi Introduce
New Ready-to-Drink Espresso,”
Packaging Digest, May 2002, p. 2; Mark
Pendergrast, “Starbucks Goes to Europe
. . . with Humility and Respect,” The
Wall Street Journal, Apr. 9, 2002, p. B16;
“Doubleshot of Starbucks’ Love,”
Beverage World, Mar. 15, 2002, p. 76;
Leung, loc. cit.; and Holmes, loc. cit.
Chapter 20
1. Inditex website, www.inditex.com,
accessed June 15, 2002; Miguel Helft,
“Fashion Fast Forward,” Business
2.0, May 2002, pp. 61–66; Richard
Heller, “Galician Beauty,” Forbes,
May 28, 2001, pp. 98_; Benjamin
Jones, “Madrid: Zara Pioneers Fashion
on Demand,” Europe, September
2001, pp. 43–44; William Echikson,
“The Fashion Cycle Hits High Gear,”
Business Week, Sept. 18, 2000,
p. EB66; Jane M. Folpe, “Zara Has a
Made-to-Order Plan for Success,”
Fortune, Sept. 4, 2000, p. 80; and
William Echikson, “The Mark of
Zara,” Business Week, May 29,
2000, pp. 98–99.
2. Charles H. Noble and Michael P.
Mokwa, “Implementing Marketing
Strategies: Developing and Testing a
Managerial Theory,” Journal of Marketing,
October 1999, pp. 57–73.
3. David Lewis, “Omni Maximizes Revenue,”
Internet Week, Nov. 26, 2001,
p. 54; and Neal Templin, “Your Room
Costs $250 . . . No! $200 . . . No . . .,”
The Wall Street Journal, May 5, 1999,
pp. B1, B16.
4. Ram Charan and Geoffrey Colvin,
“Why CEOs Fail,” Fortune, June 21,
1999, pp. 69–72_.
5. Three developments that have affected
organizational structures and, more
broadly, the role of management are
outlined in Ray Suutari, “Organizing
for the New Economy,” CMA Management,
April 2001, pp. 12–13. For a discussion
of two organizational forms—a
marketing exchange company and a
marketing coalition company—that are
designed to cope with complex and dynamic
business environments, see Ravi
S. Achrol, “Evolution of the Marketing
Organization: New Forms for Turbulent
Environments,” Journal of Marketing,
October 1991, pp. 77–93.
6. For examples, see Brenda Paik Sunoo,
“Redesigning the Company at Donna
Karan,” Workforce, July 1998, pp. 27_;
and John Hechinger, “Kodak to Reorganize
Its Business Again,” The Wall Street
Journal, Nov. 15, 2001, p. B12.
7. Seven elements of a horizontal organization
are described in John A. Byrne,
“The Horizontal Corporation,” Business
Week, Dec. 20, 1993, pp. 76–81.
8. Dana James, “Lighting the Way,” Marketing
News, Apr. 1, 2002, pp. 1, 11;
and Evelyn Theiss, “Research Shows
Good Service Is Getting Harder to
Find,” St. Louis Post-Dispatch, June
28, 1999, p. BP22.
9. “Cross-Functional Teams Flourish
amid Today’s Purchasing Evolution,”
Supplier Selection & Management
Report, March 2002, no pages given;
Avan R. Jassawalla and Hemant C.
Sashittal, “Building Collaborative
Cross-Functional New Product
Teams,” The Academy of Management
Executive, August 1999, p. 50;
and Donald Gerwin, “Team Empowerment
in New Product Development,”
Business Horizons, July–August
1999, pp. 29_.
10. The Modicon example is from Byrne,
op. cit., p. 80.
11. Melissa Campanelli, “A New Focus,”
Sales & Marketing Management, September
1995, pp. 56, 58.
12. Hechinger, loc. cit.; and Rick Brooks,
“FDX Plans Restructuring of Sales
Force,” The Wall Street Journal,
Jan. 17, 2000, p. A3.
13. Don E. Schultz, “Structural Straitjackets
Stifle Integrated Success,” Marketing
News, Mar. 1, 1999, p. 8.
14. Jennifer Hamilton and Ross D. Petty,
“The European Union’s Consumer
Guarantees Directive,” Journal of Public
Policy & Marketing, Fall 2001,
pp. 289–296; and Mike Smith, “Accord
Reached on Product Guarantees,”
The Financial Times, Mar. 23,
1999, p. 2.
15. Jayne O’Donnell, “Cosco’s History
Reads Like Recipe for Recalls,” USA
Today, Apr. 4, 2001, pp. 1B, 3B.
16. J. Joseph Muller, “Three Key Issues in
Consideration of Product Liability,”
Mid-Missouri Business Journal, Feb.
16–29, 1995, p. 22.
17. For examples, see Karen Padley, “Ford
Wins Appeal of Class Action,” National
Post, May 3, 2002, p. FP16; and
Margaret Cronin Fisk, “Suit Probes
Acne Drug’s Possible Link to Depression,”
Miami Daily Business Review,
Apr. 26, 2002, p. A12. The professor’s
quote was contained in Dan Ackman,
“Asbestos Settlements Breaking Out
etz26505_notes.qxd 4/16/03 12:55 PM Page N-21
N-22 Notes and Refe rences
All Over,” Forbes.com, Dec. 12, 2002,
no pages given.
18. “Big Tobacco Cut Down to Size, Yet
Again,” Economist.com/Global Agenda,
Mar. 27, 2002, no pages given; and
“Tobacco Takes a Hit,” Time, July 19,
1999, p. 34.
19. “Curbs on Product Liability Sought,”
Chemical Market Reporter, Aug. 16,
1999, p. 29. For the description of a
simulation model of product liability
costs, see Conway Lackman and John
Lanasa, “Product Liability Cost as a
Marketing Tool,” Industrial Marketing
Management, May 1993, pp. 149–154.
20. “Gov’t to Encourage Industry Bodies
to Set Up PL Centers,” The Korea Herald,
June 15, 2002, no pages given; and
Carolyn Aldred, “Suit to Test Europe’s
Tort Rules,” Business Insurance, Mar.
18, 2002, pp. 27_.
21. “Group Takes Note of ‘Ridiculous’
Warning Labels,” Columbia Daily Tribune,
Jan. 18, 2001, p. 6B; and “Seen
’n Heard,” Compliance Reporter, Nov.
8, 1999, p. 8.
22. Jane Spencer, “Guaranteed to Last a
Whole 90 Days,” The Wall Street Journal,
July 16, 2002, pp. D1, D5.
23. Spencer, loc. cit.; Larry Armstrong,
“And Now, a Luxury Hyundai,” Business
Week, Feb. 26, 2001, p. 33; and
Jerry Edgerton, “Promises, Promises,”
Money, February 1999, p. 173.
24. For an example of an entire promotional
campaign based on a service guarantee,
see Stephanie Paterik, “Sheraton Plans to
Pay Guests for Bad Service,” The Wall
Street Journal, Sept. 6, 2002, pp. B1, B4.
For research in the context of services
that recommends money-back guarantees,
see Glenn B. Voss, A. Parasuraman,
and Dhruv Grewal, “The Roles of
Price, Performance, and Expectations in
Determining Satisfaction in Service Exchanges,”
Journal of Marketing, October
1998, pp. 46_.
25. Dirk Van den Poel and Joseph Leunis,
“Consumer Acceptance of the Internet
as a Channel of Distribution,” Journal
of Business Research, July 1999,
pp. 249–256.
26. Jane Spencer, “The Point of No Return,”
The Wall Street Journal, May
14, 2002, pp. D1, D2; and Ann Zimmerman,
“Keep It Simple,” The Wall
Street Journal, Apr. 15, 2002, p. R10.
27. Spencer, “The Point of No Return,”
loc. cit.
28. “Business Bulletin,” The Wall Street
Journal, Jan. 20, 2000, p. A1; and Lorrie
Grant, “Online Returns a Hassle,
Even with a Storefront,” USA Today,
Oct. 28, 1999, p. 3B.
29. Information about annual number of
calls handled was provided by Otis Customer
Care via e-mail, December 16,
2002.
30. Jagdish N. Sheth and Rajendra S. Sisodia,
“Feeling the Heat,” Marketing Management,
Fall 1995, p. 22; and Scott McCartney, “PC Makers Cure Customer Ills
with Virtual House Calls,” The Wall
Street Journal, Mar. 21, 1995, p. B10.
31. David Ho, “Home-Improvement Headaches
Rank as the No. 1 Complaint
among Consumers,” St. Louis PostDispatch, Nov. 26, 2002, pp. C1, C2;
and William Flannery, “Too Many
Firms Have Workers Who Think the
Customer Isn’t Always Right. Training
Could Help,” St. Louis Post-Dispatch,
Apr. 18, 1999, pp. E1_. The quote is
from Stephen W. Brown, “Service Recovery
through IT,” Marketing Management,
Fall 1997, p. 25.
32. “Business Bulletin,” The Wall Street
Journal, Feb. 3, 2000, p. A1. For useful
recommendations, see Mary C. Gilly
and Richard W. Hansen, “Consumer
Complaint Handling as a Strategic
Marketing Tool,” The Journal of Product
and Brand Management, Summer
1992, pp. 5–16; and Roland T. Rust,
Bala Subramanian, and Mark Wells,
“Making Complaints a Management
Tool,” Marketing Management, vol. 1,
no. 3, 1992, pp. 41–45.
33. Gary Gentile, “Disney Finds a Way
to Make Profits on the Web,” St.
Louis Post-Dispatch, Nov. 12, 2002,
pp. C1, C8.
34. For an overview of this technique, see
Dennis W. Means, “A Marketing Audit
Checklist,” Agency Sales Magazine,
October 1998, pp. 54_.
35. For guidelines about marketing audits,
see “How to Kick Off or Pump Up Your
Firm’s Marketing Plan,” Accounting
Office Management & Administration
Report, February 2002, no pages given;
and Bill Merrick, “Marketing Committees
Evolve as CUs Grow,” Credit
Union Magazine, December 2001, no
pages given. The quote is from Dale
Terry, “How Does Your Bank’s Marketing
Size Up?” Bank Marketing, January
1995, pp. 53–58.
36. For the original discussion of the marketing
audit, see Abe Schuchman, “The
Marketing Audit: Its Nature, Purpose,
and Problems,” in Analyzing and Improving
Marketing Performance: “Marketing
Audits” in Theory and Practice,
American Management Association,
New York, Management Report no. 32,
1959, p. 14.
37. Professor Ravi Dhar, as quoted in Diane
Brady, “Why Service Stinks,” Business
Week, Oct. 23, 2000,
pp. 118–122_.
38. The quote is from Daniel M. Hrisak,
“Survey Respondents: Revenue
Recognition Has Highest Priority,”
Managing the General Ledger, March
2001, p. 3. Also see John A. Weber,
“Managing the Marketing Budget in
a Cost-Constrained Environment,”
Industrial Marketing Management,
November 2002, pp. 705–717.
39. For a method of determining the
value of customers, see Roger Connell,
“Calculating the Contribution of
Customers—a Practical Approach,”
Journal of Targeting, Measurement and
Analysis, September 2002, pp. 13_.
For more about examining both sales
volume and costs and their links to
strategy, see Gordon A. Wyner, “Customer
Profitability,” Marketing Management,
Winter 1999, pp. 8–9.
40. Will Morton, “The Unprofitable Customers,”
The Wall Street Journal, Oct.
28, 2002, p. R7.
41. “Stefan Persson: Hennes & Mauritz,”
Business Week, Jan. 13, 2003, p. 63. Inditex
website, loc. cit.; Helft, loc. cit.;
Heller, loc. cit.; Jones, loc. cit.; Echikson,
“The Fashion Cycle Hits High Gear,”
loc. cit.; Folpe, loc. cit.; and Echikson,
“The Mark of Zara,” loc. cit.
Chapter 21
1. Jennifer Godwin, “Partings and Performance,”
Forbes, Nov. 27, 2000,
www.forbes.com; “Maritz Marketing
Research, Inc., Launches eQuest,” PR
Newswire, Sept. 28, 2000; company
press releases; www.maritz.com, accessed
on Feb. 14, 2002.
2. The structure for this discussion of
electronic networking is based on Ravi
Kalakota, Ralph A. Oliva, and Bob
Donath, “Move Over E-Commerce,”
Marketing Management, Fall 1999,
pp. 22–31.
3. “Online Sales in 2001 Generated Profits
for More than Half of All U.S. Retailers
Selling Online,” news release of
Shop.org a division of the National Retail
Federation, www.shop.org/press,
accessed Oct. 7, 2002.
4. Alorie Gilbert, “New Trend Rising after
B2B Setbacks,” CNET.com, Tech
News, www.news.com.com, accessed
Oct. 7, 2002.
etz26505_notes.qxd 4/16/03 12:55 PM Page N-22
Notes and Refe rences N-23
5. Paul Davidson, “Manufacturers Must
Alter Strategies for Retail Success,”
USA Today, June 4, 1999, p. 1B.
6. William Hoffman, Jennifer Keedy,
and Karl Roberts, “The Unexpected
Return of B2B,” McKinsey Quarterly,
no. 3, 2002, accessed at www.
mckinseyquarterly.com, Oct. 7, 2002.
7. Statement of the chairman of the
board, at www.ibm.com/lvg/ accessed
on Oct. 9, 2002.
8. Catharine P. Taylor and Jeff Howe,
“Web Disconnect,” Adweek, Sept. 9,
2002, pp. 22_.
9. Otis Port, “Customers Move into the
Driver’s Seat,” Business Week, Oct. 4,
1999, pp. 103–106.
10. Beth Cox, “The E-Commerce Evolution,”
ecommerce-guide.com, Apr. 25,
2002, accessed at www.ecommerce.
internet.com/news on Oct. 10, 2002;
“Study Reveals Previously Unmeasured
Characteristics of U.S. Online Hispanic
Population,” HispanicAd.com, May 13,
2002, accessed at www.hispanicad.com/
cgi-bin/news on Oct. 10, 2002.
11. Susan Gregory Thomas, “Getting to
Know You.Com,” U.S. News & World
Report, Nov. 15, 1999, pp. 102–112.
12. Paul Davidson, “Manufacturers Squeeze
the Hands that Sells Them,” USA Today,
June 4, 1999, p. 1B.
13. Amway Joins Rush to the Net with Online
Store,” St. Louis Post-Dispatch,
Mar. 3, 1999, p. C7.
14. “Can e-Tailers Find Fulfillment?”
July 28, 2002, from Knowledge@
Wharton, CNET News.com, accessed
at www.news.com on Oct. 12, 2002.
15. Tim Lemke, “Pop-Ups Strike Out with
Internet Advertisers,” The Washington
Times, Sept. 9, 2002, accessed at EBSCO
Host, item number 2W60148723187 on
Oct. 10, 2002.
16. Dana James, “Linked for Success,”
Marketing News, Jan. 3, 2000, p. 3.
17. Heather Green and Linda Himelstein,
“To the Victor Belong the Ads,” Business
Week, Oct. 4, 1999, p. 39; Tom
Spring, “Web Ad Explosion,” PC
World, September 2002, pp. 24_.
18. Matt Richtel, “Credit Card Theft Is
Thriving Online as Global Market,”
The New York Times, May 13, 2002,
p. A1.
19. Ann Grimes, “What’s in Store,” The
Wall Street Journal, July 15, 2002,
p. R6.
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