Spring 2014
Marketing Management (M240)
Winter 2012
Instructor
Pedro Gardete
W-348
650-725-1735
gardete@stanford.edu
Faculty Assistant
Delilah Gallardo
W-308
650-723-0547
gallardo_delilah@gsb.stanford.edu
Course Description
The goal of this course is to introduce you to the essentials of marketing management. In
this class, you will discover how firms and customers behave and learn the strategies and
methods that marketers can use to operate successfully in today's dynamic environment.
The three key objectives of this course are:
• To introduce you to the key elements of marketing management
• To provide you with a sound framework for identifying, analyzing, and solving
marketing problems
• To enhance your leadership, analytical, and communications skills
Keep in mind that effective marketing management results not from simply internalizing
marketing facts and institutional detail, but from systematic critical thinking and the
reasoned application of several general, underlying principles.
"Whatever be the detail with which you cram your student, the chance of his meeting in
after-life exactly that detail is almost infinitesimal; and if he does meet it, he will
probably have forgotten what you taught him about it. The really useful training yields a
comprehension of a few general principles with a thorough grounding in the way they
apply to a variety of concrete details. In subsequent practice the (students) will have
forgotten your particular details; but they will remember by an unconscious common
sense how to apply principles to immediate circumstances."
-- Alfred Whitehead, The Aims of Education and Other Essays.
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Spring 2014
Marketing Management (M240)
4/4
4/7
1. Introduction and Overview
4/11
2. Segmentation & Targeting
4/14
3. Segmentation & Targeting II
Calyx Flowers: Managing Profitable Growth
4/18
4. Positioning
Product Team Cialis: Getting Ready to Market
4/21
5. Developing a Value Proposition
Datril
4/25
6. Leveraging Value
Steinway & Sons: Buying a Legend
4/28
7. Capturing Value I
The New York Times Paywall
8. Capturing Value II
Optical Distortion
5/2
9. Special Session: Guest Speaker (12pm, G101)
Brian McAndrews
CEO, President and Chairman at Pandora
5/5
5/9
5/12
10. Integrative Case
Aqualisa Quartz
GROUP CASE WRITE-UP DUE
11. Special Session: Guest Speaker
Tony Small
VP, Sales Strategy and Operations at Zillow
5/16
13. Special Session: Guest Speaker (12pm, G101)
Steve Kessel
SVP, Worldwide Digital Media, Amazon
5/23
15. Special Session: Guest Speakers from
General Mills
Jenny Zechmeister
Jay Picconatto
5/30
17. Integrative Case
Soren Chemical
MARKETING PLAN DUE
12. Acquiring and Retaining Customers I
Dryclean Express
5/19
14. Communicating Value I
5/28
16. Special Session: (Wedn.) Guest Speaker
Abhishek Pani
Head, Data Science for Adobe Online Advertising
6/2
18. Summary and Wrap-up
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Course Requirements
During the term, the students (working individually and in groups) will be evaluated
based on their performance in each of the following activities:
Class Participation
Group Case Write-Up
Group Marketing Plan
Final Examination
25%
20%
20%
35%
Note that the overall grade is based on both individual-level performance and group
performance.
Class Participation
Almost every session of the course will involve interaction in the form of class
discussion. I expect each student to be prepared at all times to comment in any class
session. To reinforce this expectation, I will randomly select (i.e., cold call) students at
the beginning of the session (to open the class) and throughout the ensuing discussion
(whether or not the student's hand is raised).
Many of the sessions in this course follow a case discussion format. The case method is
not always an efficient learning vehicle, but it is one of the most effective means of
sharpening your decision-making abilities, requiring you to be an active participant in
resolving a marketing problem. The assigned cases are intended to give you practice in
assembling data to support a decision. Further, the case method provides a vehicle by
which to apply the theories, concepts, and analytical devices discussed in a class or in the
reading materials.
Finally, the discussion forum provides an opportunity to argue your position and to learn
from others by listening to their comments and criticisms.
As part of your preparation for class, you should work together in groups to prepare the
assigned case studies. The purpose of these groups is to assist each participant in
developing his or her understanding of the issues and topics raised in the cases. The
discussion group is a useful and informal forum in which to test your ideas. Further, your
discussion group should also be the same group you work with on the written
assignments, thus allowing you to build your problem solving skills as a group as the
term progresses.
We expect students to be responsible for managing the division of labor within the group.
I am asking you to form your own study groups. Your group should consist of no more
than five persons (a smaller group size may be OK; be sure to check with me). Choose a
name for your group and submit a list of group members to my assistant (preferably
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by e-mail) in advance of the second class session.
Case preparation. In preparing for class, I recommend that you read the case more than
once. The first reading should give you a feeling for what the case is about and the types
of data contained in the case. Many people like to underline or otherwise mark up their
cases to pick out important points relating to the business and the situation; e.g., customer
behavior and trends, competitor's behavior and trends, and the firm's strengths and
weaknesses. Be sure to pay attention to the exhibits in the case; these often contain
information that will be useful in analyzing the situation.
Once you have a good idea of the fundamentals, you should read the case again with the
goal of understanding the specific situation. You will want to get at the root causes of
problems and gather data from the case that will allow you to make specific action
recommendations. During this reading, carefully prepare your answers to the assigned
discussion questions. As is often the situation in actual practice, cases may not have all
the data you would like. Nevertheless, it is critical that you develop a reasoned plan of
attack on the basis of the data available. Moreover, you should not attempt to find out
what happened to the company or business as a basis for making your decision. At no
time should papers or notes from previous or concurrent marketing courses be
used. Such use constitutes a violation of the Stanford Honor Code. These criteria
apply to both in-class and written case analyses.
In the class discussion, we will try to build a complete analysis of the situation and
address the problems and issues in the case. Each person is expected to be prepared to
share his or her individual views with the class. The principal objective of the discussions
is to examine completely all aspects of the situation: facts, suppositions, alternatives,
final action. In these sessions, it is my job as instructor to facilitate discussion: first to
obtain all views and finally to help pull together the prevailing views of the discussion.
Note that the direction and quality of the discussion is the collective responsibility of the
group.
A typical request at the end of a case discussion is: What is the answer? Let me
emphasize here that the case method of learning does not provide the answer. In most
case discussions, several viable "answers" will be developed and supported by various
participants. In real life, there is a multitude of factors (only a tiny fraction of which are
detailed in the case) that contributes to a decision’s success or failure.
What is important is that you know what you would have done in that specific marketing
situation, that you clearly communicate your marketing analysis and recommendation,
and that you can defend that analysis and recommendation. You will be evaluated on
your ability to defend your recommendations. There are often very excellent defenses
available on both sides of any given issue. A sensible recommendation, when based on
superficial reasoning, is not compelling.
In selecting case materials, I chose cases that are relevant (i.e., fit the pedagogical
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objectives of the course), interesting (i.e., topical), or both. Some of the cases may appear
to be far removed from problems pertinent to your particular industry experience, but in
general, the lessons to be learned from the cases are universally relevant and transcend
particular situations and time.
Evaluating class participation. Grading class participation is necessarily subjective.
Some of the criteria for evaluating effective class participation include:
1. Is the participant prepared, and do his or her comments show evidence of analysis
of the case, thereby adding to the group’s understanding of the situation? Does the
participant go beyond simple repetition of case facts without analysis and
conclusions? Do comments show an understanding of theories, concepts,
analytical devices presented in class lectures or reading materials?
2. Is the participant a good listener? Are the points made relevant to the discussion?
Are they linked to, but not redundant with, the comments of others? Is the
participant willing to interact with other class members?
3. Is the participant an effective communicator? Are concepts presented in a concise
and convincing fashion?
Keep in mind that your grade for class participation is not simply a function of the
amount of “air time” you take up. In general, I will evaluate you on how well you
respond to the questions and on how effectively you take into account the comments and
analyses of your classmates.
Group Assignments
Group Case Write Up
Each group will submit a written analysis for the Aqualisa Quartz case (Session 10, May
7). The case write-up is due in soft copy and should be sent to
gallardo_delilah@gsb.stanford.edu before the beginning of class on the day the case is to
be discussed. No cases will be accepted late. Please include a separate cover page with
your identifying information (group name and individual names). After that cover page,
please have no identifying information so the cases can be graded blindly. There is a
strict upper limit of four pages of text, single spaced (with an additional three pages of
exhibits). Please use standard margins (at least 1") and conventional font size (12-point,
Times New Roman). In your exhibits, strive for simplicity. Conveying your data in
concise form with fewer assumptions will increase its persuasiveness. The use of
quantitative analysis to support ideas is welcomed and encouraged, as long as it is
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presented in a clear and intuitive fashion.
In preparing your write-up, I suggest you use the following format:
1.
2.
3.
4.
Statement of the Problem.
Recommendations.
Analysis.
Exhibits (if any).
Some general guidelines for preparing an effective write-up are:
1. Provide a coherent, well-organized analysis.
2. Be concise. Do not spend time rehashing or paraphrasing the details of the case
without explicitly using them to make a broader point for your analysis.
3. Focus your specific recommendations on the important issues in the case. Be sure
to address all of the discussion questions somewhere in the write-up, in addition
to any other issues you believe are critical.
4. Do not write a consulting report that simply provides your recommendations.
Provide a balanced analysis and demonstrate an awareness of potential arguments
against your recommended course of action.
5. Tie your exhibits to the text of the report.
6. Make explicit all of the assumptions you use in generating your exhibits. Where
nonobvious, also make explicit your calculations.
7. Whenever possible, specify how the implementation of recommendations is to
take place (be specific).
Presentation. For the case write up, your group may also be asked to make a brief
opening presentation in front of the class (in addition to handing in a written case
analysis). During the term, I will provide you with details and guidelines for the
presentation. All group members will receive the same grade for the group project and
the group case write up. You will, however, have the opportunity to indicate the level of
contribution of your teammates, and this may be used to adjust grades in the final
equation.
Marketing Plan
A marketing plan is a document that contains an analysis of the situation surrounding a
marketing problem and a proposed course of action. Many books have detailed the
components of a marketing plan (see Chernev, 2009, Strategic Marketing Management,
for a review of different books’ recommendations for marketing plans). Though they
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differ in some ways, each of the recommendations has more commonalities than
differences. The assignment in this class will be based most closely on the outline by
Kerin and Peterson (2000, Strategic Marketing Problems: Cases and Comments). It has
been tailored somewhat to be practicable given the information available in the case that
has been assigned to you this year.
Although this will be your first (and last) marketing plan in this course, you have already,
in the course of your case analysis preparation, engaged in each of the component parts of
the marketing plan. Your marketing plan for this assignment should contain the following
information and adhere to this organization:
1.
2.
3.
4.
Executive summary
Company description (be brief)
Company goals and strategic focus
Situation analysis
a. Competition analysis
b. Company analysis
c. Customer analysis
5. Product-market focus
a. Segmentation analysis
b. Target market(s)
c. Positioning
6. Marketing program
a. Product strategy
b. Price strategy
c. Promotion strategy
d. Distribution strategy
7. Financial analysis and supporting exhibits and appendices
Your marketing plan will be limited to 5 single-spaced pages of text in 12-point Times
New Roman font, 1” margins. You will have up to an additional 4 pages of exhibits. As
with the case write-up above, your group may be called upon to make a brief presentation
of your recommendations. If so, the instructor will notify you in advance of the class
session.
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Final Examination
The final examination will consist of a case analysis, similar to the ones we have
analyzed throughout the term. It is an exclusively individual task and it will be delivered
as a take home, through coursework. The same criteria used to assess the written case
assignment will be used to judge your test performance. Thus, the best way to prepare for
the exam is to conscientiously study each of the cases throughout the term, answer the
discussion questions, read the assigned readings, and attend the classes. The exam will be
open book, open notes. No additional guidance should be necessary. A copy of last year's
final exam, along with sample answers to the case analysis, will be placed on reserve at
the Library.
Honor Code
Most of the material you will encounter in marketing management is not highly
mathematical or heavily analytical. The secret to success in the subject matter is working
hard to integrate a wide variety of disparate tools and frameworks into a coherent
approach to solving marketing problems. This kind of individual learning requires
individual effort. The following guidelines are provided for reference:
• Discussion within your study group is acceptable and encouraged for purposes of
general case preparation. Each group should establish an expectation that every
member participates in the group process (i.e., no free riding!), which means at a
minimum having read and thought about the assigned material. Each individual
should have sufficient grasp of the material to be able to hold his or her own during
class participation (i.e., one should not expect to "pass the baton" to a study group
teammate when called upon).
• Your class preparation should not benefit from notes of case discussions from
students who have taken this course in the past or at other schools. This means that
you should not use analyses of cases posted to the Internet or sent via e-mail from
individuals outside your study group.
• Because not all marketing students cover the same cases at the same time (or even
in the same quarter), please refrain from discussing the details of the class outside
of your section until all students have had the opportunity to grapple with the issues
from the case.
• For your group case write up and group projects, it is important that you
demonstrate how well your group members understand the course concepts. For this
reason, please do not consult with individuals outside of your study group.
Failure to abide by these guidelines will constitute an Honor Code violation.
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Readings
All required readings are included in the course syllabus packet (occasionally, additional
readings will be distributed in class). For those interested in more background, we have
made two texts available at the Reserve Desk in Jackson Library:
Kotler, Philip and Kevin Keller (20011) Marketing Management (14/e). Upper
Saddle River, NJ: Prentice-Hall, Inc.
Winer, Russell S. and Ravi Dhar (2010) Marketing Management (4th Edition).
Upper Saddle River, NJ: Prentice-Hall, Inc.
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OUTLINE OF CLASS ASSIGNMENTS
SESSION 1 INTRODUCTION AND OVERVIEW
Friday, April 4
In this introductory session, you will get an introduction to evaluating a business
opportunity using marketing concepts. We conclude the session by going over the
various requirements and administrative details associated with the course.
ASSIGNED READING:
Please read through the “Course Description” and this “Outline of Class
Assignments” and come prepared with any questions.
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SESSION 2 SEGMENTATION AND TARGETING I
Monday, April 7
We devote the session to presenting a framework that is useful for understanding
customer behavior. We will discuss how to successfully segment markets and
identify desirable targets.
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SESSION 3 SEGMENTATION AND TARGETING II
Friday, April 11
CASE: Calyx Flowers: Managing Profitable Growth (Kellogg 0845)
DISCUSSION QUESTIONS:
1. Which attributes are important to people when they buy flowers?
2. Identify and describe the wants and needs of different customer segments in
the flowers market
3. Identify the key problem for Calyx Flowers and propose a course of action
ASSIGNED READING:
Aaker, "Positioning Your Product," Business Horizons, 25 (May-June), pp. 56-62.
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SESSION 4 POSITIONING
Monday, April 14
CASE: Product Team Cialis: Getting Ready to Market (HBS 9-505-038)
Lilly and ICOS are preparing for the launch of a new drug, Cialis, to compete
against Viagra. To position against the incumbent firm Pfizer, which developed
and markets Viagra, and other newcomers into the erectile dysfunction market,
they must determine how best to segment the market and which target market to
focus on. Additionally, they must set a communications strategy that leverages
their understanding of the ED market, their own strengths, and the competition.
DISCUSSION QUESTIONS:
1.
2.
3.
4.
5.
What is the process by which customers acquire and use prescription drugs like
Cialis? Which aspects of that process are most important for Cialis, and how can
Cialis best affect them?
What are the different segments of consumers? Which parts of the decision
making process are most relevant to each of these? How attractive is Cialis to
each of these segments?
What are the primary impediments to adoption? What does this imply about
marketing efforts?
How did the first entrant, Viagra, affect the potential market? What are some of
the advantages and disadvantages of being a first-mover?
What are the competitive strengths and weaknesses of Viagra? Assess Levitra as a
competitor. How should Cialis account for each of these competitors in its
launch?
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SESSION 5 DEVELOPING A VALUE PROPOSITION
Friday, April 18
CASE: Datril: Pioneering the Acetaminophen Market (Kellogg 0804)
Bristol-Myers, a leading manufacturer of pharmaceutical and consumer products,
must determine how to market its newest product: Datril, a non-prescription
acetaminophen drug.
DISCUSSION QUESTIONS:
1.
2.
3.
4.
5.
6.
What should Bristol-Myers do?
Who are the target customers?
What is Datril’s value proposition?
How should Datril be priced?
What incentives (either consumer or retailer) should be offered, if any?
How should Bristol-Myers communicate the benefits of Datril?
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SESSION 6 LEVERAGING VALUE
Monday, April 21
CASE: Steinway & Sons: Buying a Legend (A) (HBS 9-500-028)
For 140 years, Steinway has held the reputation for making the finest quality
grand pianos in the world. In 1992, Steinway was considering introducing a midpriced line of grand pianos under the brand name "Boston." Designed by
Steinway, but manufactured by a Japanese piano maker, the Boston line would
represent a major shift in strategy for the company.
DISCUSSION QUESTIONS:
1. What is the essence of the Steinway brand? What accounts for the value of the
brand?
2. Who are Steinway’s customers? How should the market for pianos be segmented?
3. What do you think of Steinway and Sons’ 1992 decision to launch the Boston line
of pianos? Discuss the pros and cons of this decision.
ASSIGNED READING:
Aaker, “Should you take your brand to where the action is?” (HBS 97501).
Keller, Sternthal and Tybout, “Three Questions You Need to Ask About Your
Brand,” Harvard Business Review (Reprint R0209F).
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SESSION 7 CAPTURING VALUE I
Friday, April 25
CASE: The New York Times Paywall
This case examines The Times’ decision to start charging for content. It examines
the trade-offs underlying this dramatic shift in the company’s business model,
which is complex due to its multi-sided, multi-channel nature and the competitive
landscape.
DISCUSSION QUESTIONS:
1. Is the Paywall working?
2. How would you evaluate the current Paywall with the two prior ones? Do you
think it is appropriately designed compared with the Financial Times or the Wall
Street Journal?
3. Why are newspapers in trouble? What is the goal of The Times in creating the
Paywall?
4. Should The Times actively manage its transition from print to digital?
5. Does the Paywall seem like a good strategy for newspapers in general?
OPTIONAL READING:
Dolan, “Note on Low-Tech Marketing Math” (HBS 9-599-011). This note
provides some background information for those unfamiliar (or uncomfortable)
with certain marketing terms (e.g., margin, contribution, break-even) and the
basic calculations associated with them. Some marketing math will prove useful
in your analysis of cases from this point onward.
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SESSION 8 CAPTURING VALUE II
Monday, April 28
CASE: Optical Distortion, Inc. (A)
A new product, contact lenses for chickens, is to be introduced by a small firm
formed to market the product. An entry strategy must be planned including price,
sales force, size, and location.
DISCUSSION QUESTIONS:
1. What characteristics of the ODI contact lens are likely to make it appealing or
unappealing to different types of chicken farmers?
2. In what geographic areas should ODI focus its efforts?
3. On what market segments (in addition to geographic) should ODI focus its
efforts?
4. What pricing policy should ODI adopt?
ASSIGNED READING:
Dolan, “Pricing: A Value-Based Approach,” (HBS 9-500-071)
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SESSION 9 SPECIAL SESSION: Brian McAndrews, CEO, President and Chairman of
Pandora
Friday, May 2
The session will be held from 12pm to 1pm in the G-101 classroom. Please arrive
promptly so that we may start on time. As a sign of respect for our guest, please
plan on staying for the entire session.
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SESSION 10 INTEGRATIVE CASE
Monday, May 5
CASE: Aqualisa Quartz: Simply a Better Shower (HBS 9-502-030)
In May 2001 Aqualisa had launched the Quartz shower, a significant product
innovation in the U.K. shower market. By September 2001, the euphoria
surrounding the product's initial launch had long since faded. Harry Rawlinson,
managing director of Aqualisa, knew that the Quartz was technologically leaps
and bounds above other U.K. showers in terms of water pressure, ease of
installation, use, and design. But for some reason, it simply wasn't selling.
DISCUSSION QUESTIONS:
1. Describe the customers that the Aqualisa Quartz (AQ) is best designed to serve.
Which other products in the market, if any, should the AQ be positioned against?
2. Why isn’t Aqualisa Quartz selling? What combination of distribution and
promotion is best suited to get the AQ in the showers of the intended customers?
3. How should Aqualisa Quartz be priced? Why? How is the pricing decision related
to your answer to question 2?
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SESSION 11 SPECIAL SESSION: Tony Small, VP, Sales Strategy and Operations at
Zillow
Friday, May 9
This session will be held in the usual class time. Attendance is required. Please
arrive promptly so that we may start on time. As a sign of respect for our guest,
please plan on staying for the entire session.
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SESSION 12 ACQUIRING AND RETAINING CUSTOMERS I
Monday, May 12
CASE: DryClean Express: Managing Dissatisfied Customers (Kellogg 0836)
DryClean Express has lost a customer’s item and must determine how to treat the
customer following the mishap.
DISCUSSION QUESTIONS:
1. What should the dry cleaner do, if anything, to compensate the customer?
2. What is the value of the customer to the firm?
3. What other factors, other than customer value, affect your decision?
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SESSION 13 SPECIAL SESSION: Steve Kessel, SVP of Worldwide Digital Media at
Amazon
Friday, May 16
The session will be held from 12pm to 1pm in the G-101 classroom. Please arrive
promptly so that we may start on time. As a sign of respect for our guest, please
plan on staying for the entire session.
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SESSION 14 COMMUNICATING VALUE I
Monday, May 19
In this session, we discuss both classic and contemporary approaches to
communicating value to consumers. We will reflect on what makes these
approaches work and relate the approaches to underlying psychological variables
that underlie their success (or failure).
ASSIGNED READING:
Dolan, "Integrated Marketing Communications," (HBS 9-599-087).
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SESSION 15 SPECIAL SESSION: GENERAL MILLS
Friday, May 23
This session will be held in the usual class time. Attendance is required. Please
arrive promptly so that we may start on time. As a sign of respect for our guests,
please plan on staying for the entire session.
GUEST LECTURE: General Mills
Visitors from General Mills will discuss the process of brand management, using
a specific case study (involving the development, testing, and introduction of a
new product) to illustrate the various responsibilities of brand managers.
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SESSION 16 SPECIAL SESSION: Abhishek Pani, Head of Algorithms and Data Science
for Adobe Online Advertising
Wednesday, May 28
This session will be held in the usual class time. Attendance is required. Please
arrive promptly so that we may start on time. As a sign of respect for our guest,
please plan on staying for the entire session.
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SESSION 17 INTEGRATIVE CASE
Friday, May 30
CASE: Soren Chemical: Why is the New Swimming Pool Product Sinking? (HBS 4188)
Jen Moritz, marketing manager for Soren Chemicals, is struggling with the poor
sales performance of Coracle, a new clarifier for smaller, residential-size
swimming pools. Moritz suspects that the go-to-market strategy for Coracle may
be flawed, but she is unsure where the problem lies.
DISCUSSION QUESTIONS:
1. What is the addressable market size for Coracle? Is the first-year goal of $1.5
million sales reasonable?
2. Why is Soren Chemical struggling to sell Coracle? What are the implications of
the channel structure for pool chemicals? How would you describe the selling
process for Kailan MW versus Coracle?
3. What is the highest price Soren Chemical can set for Coracle? What is the impact
of a higher retail price on distributors and retailers?
4. What action plan do you recommend for Coracle? Should Soren Chemical adopt a
push or pull strategy?
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SESSION 18 SUMMARY AND WRAP-UP
Monday, June 2
In this final session, we summarize the course and take care of any remaining
administrative details.
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