Welcome to
MKTG 516 - Marketing Strategy and Functions
Western Illinois University, College of Business and Technology
Accredited by AACSB, The International Association for Management Education
Spring 2003
Instructor:
Office:
Telephone:
Home Page:
E-mail:
Meeting Times:
Location:
Office Hours:
Dr. John T. Drea, Associate Professor of Marketing
430-E Stipes Hall
Office 309-298-1272 (if there’s no answer, leave a message or call
298-1198) Home: 309-837-4605
www.cbt.wiu.edu/John_Drea/index.htm
jt-drea@wiu.edu
Tuesdays 6:00-8:30 pm
ST 207, and through Distance Learning
Tuesdays and Thursdays from 2-4:30 pm, and by appointment
COBT Mission
The Mission of the College of Business and Technology at Western Illinois University is
to provide a focus for educational excellence which promotes the intellectual and
personal growth of participants and enhances their contributions to individuals,
organizations, and society.
Course Description
Analysis of integrated marketing efforts targeted at consumer and industrial markets.
Training in information tools, market segmentation processes, development of strategies
(combination of product, pricing, distribution, and promotion plans), plus coordination of
internal and external resources for a goal-oriented and controlled plan implementation.
Credits
3 semester hours
Prerequisite
Graduate standing
Required Texts
 Kerin, Roger A., Eric N. Berkowitz, Steven W. Hartley, and William Rudelius
(2003), Marketing, 7th edition. Chicago: Irwin.
 Hartley, Robert F. (2001), Marketing Mistakes and Successes, 8th edition. New
York: John Wiley and Sons.
Course Focus
The goal of this class is to enable the student to understand and develop marketing
strategies. The course uses the concepts of customer value and sustainable competitive
advantage as a basis for strategy development. To achieve these goals, a background in
fundamental marketing terminology and concepts is also covered. To integrate concepts
covered in the classroom and provide a basis for applying marketing knowledge, a
semester long project will be used (a Student Marketing Audit).
Course Goals
Upon completion of this course, the students should be able to:
1.
Understand fundamental marketing terminology, which will include being able to
define the following terms:
marketing
brand loyalty
buildup forecast
exchange
attitude
survey of buyers
target market
opinion leaders
intentions forecast
marketing mix
word-of-mouth
sales force survey
customer value
reference groups
forecast
marketing concept
family life cycle
Delphi forecast
market orientation
organizational buyers
trend extrapolation
social responsibility
NAICS
product life cycle
market share
derived demand
branding
business unit
reciprocity
brand name
business unit
straight rebuy
trade name
competencies
new buy
trade mark
competitive advantage
modified rebuy
brand equity
balance of trade
marketing research
licensing
protectionism
primary data
manufacturer branding
World Trade
secondary data
multiproduct branding
Organization
statistical inference
private branding
strategic alliances
probability sampling
generic brand
multidomestic
nonprobability sampling
skimming pricing
marketing strategy
observational data
penetration pricing
global marketing
questionnaire data
prestige pricing
strategy
market segmentation
price lining
values
product differentiation
odd-even pricing
ISO 9000
market segments
bundle pricing
exporting
usage rate
markup on cost
joint venture
product-market grid
markup on selling price
direct investment
perceptual map
cost-plus pricing
consumer behavior
repositioning
experience curve pricing
evaluative criteria
relationship marketing
target return-onevoked set
database marketing
investment pricing
cognitive dissonance
market potential
above-, at-, or belowinvolvement
industry potential
market pricing
situational influences
sales forecast
loss-leader pricing
subliminal perception
top-down forecast
flexible pricing policy
promotional allowances
everyday low pricing
FOB origin pricing
uniform delivered
pricing
basing point pricing
price fixing
price discrimination
predatory pricing
stockturn rate
marketing channel
direct channel
indirect channel
strategic channel
alliances
direct marketing
general merchandise
wholesalers
specialty merchandise
wholesalers
rack jobbers
cash and carry
wholesalers
drop shippers
truck jobbers
manufacturer's agents
selling agents
brokers
vertical marketing
systems
franchising
intensive distribution
exclusive distribution
selective distribution
channel captain
retailing
depth of product line
breadth of product line
scrambled
merchandising
hypermarket
telemarketing
retail positioning matrix
retailing mix
off-price retailing
power center
wheel of retailing
retail life cycle
encoding
decoding
field of experience
feedback
noise
advertising
personal selling
public relations
publicity
sales promotion
promotional mix
push strategy
pull strategy
integrated marketing
communications
cooperative advertising
hierarchy of effects
percentage of sales
budgeting
competitive parity
budgeting
all-you-can-afford
budgeting
reach
rating
frequency
gross rating points
CPM
infomercials
sales management
relationship selling
order taker
order getter
missionary salespeople
team selling
need-satisfaction
presentation
adaptive selling
consultative selling
2. Explain what is meant by customer value.
3. Identify the unique characteristics of services (as opposed to products).
4. Differentiate between products and services in how customers form impressions of
product/service quality.
5. Identify the five potential gaps in the delivery of services, and provide concrete
suggestions on how to prevent/reduce/eliminate these gaps.
6. Explain what is meant by value-based pricing, and demonstrate how this concept can
be used.
7. Define what is meant by customer satisfaction, and describe a process for achieving
customer satisfaction.
8. Identify the generic strategies that can lead to sustainable competitive advantage.
9. Identify and explain the five competitive forces that determine industry profitability.
10. Differentiate between a global and localized marketing strategy, and know when each
is most appropriate.
11. List and explain how to implement the seven steps for analyzing consumer behavior.
12. Understand the fundamental differences between consumer and industrial markets.
13. Segment an overall market for a product/service, using an accepted segmentation
basis.
14. Locate secondary information, using the resources of the WWW.
15. Understand when to collect primary data and when to rely on secondary data.
16. Identify survey questions which are clear and well-scaled, and those which are not.
17. Understand the steps companies need to follow to achieve relationship marketing
with clients.
18. Explain strategies for brand products and services.
19. Calculate prices for products, using the following pricing techniques/strategies:
a. Cost-plus
b. target ROI
c. penetration
d. skimming
e. markup
f. market share.
20. Understand the types of wholesalers, the services and costs associated with each, and
the appropriate roles filled by each.
21. Explain the special application of marketing principles in a retail environment.
22. Identify the appropriate uses for advertising, sales promotion, public relations, and
personal selling in creating an integrated marketing strategy.
23. Understand the terminology associate with the field of advertising.
24. Understand the fundamental principles of media selection.
25. Differentiate between alternative sales functions (e.g., order getters, order takers, etc.)
26. Identify and explain the tools available to a sales manager to motivate and control the
actions of the sales force.
27. Use performance-importance analysis to construct a marketing position map.
28. Calculate and interpret a stockturn rate.
Course Outline:
Week Date Assignment
1
1/14
Berkowitz: Read Chapter 1, Developing Customer Relationships and Value
Through Marketing
2
1/21
Berkowitz: Read Chapter 2, Linking Marketing and Corporate Strategies
Berkowitz: Read APPENDIX A: A Sample Marketing Plan
3
Berkowitz: Read Chapter 7, Reaching Global Markets
Berkowitz: Read Chapter 5, Consumer Behavior (start)
1/28
Read Hartley: Chapter 4: Airliner Wars: Airbus vs. Boeing
Quiz #1, Chapters 1, 2, and 7
4
Berkowitz: Read Chapter 5, Consumer Behavior
2/ 4 Read Hartley: Chapter 20, Southwest Airlines – Try to Match Our Prices
Berkowitz: Read Chapter 6, Organizational Markets and Buyer Behavior
5
2/11
Exam #1: Berkowitz Chapters 1, 2, 5, 6, 7, and Appendix A (2/11)
Berkowitz: Read Chapter 8, Turning Marketing Information into Action
6
Marketing Audit Phase #1 Due (Organizational Background) (2/18)
2/18 Berkowitz: Read Chapter 9, Identifying Market Segments and Targets
Hartley: Read Chapter 15, Disney – Euro Disney and Other Stumbles
7
2/25 Berkowitz: Read Chapter 11, Managing Products and Brands
----
Marketing Audit Phase #2 Due (Environmental Influences, Target
Markets) (2/25)
3/4 Berkowitz: Read Chapter 13, Building the Price Foundation
Hartley: Read Chapter 14: Borden – Letting Brands Wither
Quiz #2, Chapters 8, 9, and 11
3/11 No Class - Spring Break
9
3/18
10
Exam #2: Berkowitz Chapters 9, 10, 12, 14, 15 (3/25)
3/25 Berkowitz: Read Chapter 15, Managing Marketing Channels and
Wholesaling
11
Berkowitz: Read Chapter 16, Integrating Supply Chain and Logistics
Management
Hartley: Read Chapter 18, Rubbermaid – Perils of Not Satisfying a Major
4/1
Customer
Marketing Audit Phase #3 Due (Product, Pricing, Distribution and
Promotion Strategies) (4/1)
12
Berkowitz: Read Chapter 17, Retailing
4/8 Marketing Audit Phase #4 Due (Specification of Primary Marketing
Problem) (4/8)
13
Berkowitz: Read Chapter 18, Integrated Marketing Communications and
Direct Marketing
4/15
Hartley: Read Chapter 16, Coors – What’s Wrong with Being Number
Three?
14
Berkowitz: Read Chapter 19, Advertising, Sales Promotion, and Public
Relations
4/22
Hartley: Read Chapter 19, Vanguard – Success with Minimal Marketing
Quiz #3, Chapters 15, 16, 17, and 18
15
4/29
16
5/6 Final Exam #3: Berkowitz Chapters 15, 16, 17, 18, 19 (6-7:50 pm)
8
Berkowitz: Read Chapter 14, Pricing: Arriving at the Final Price
Hartley: Read Chapter 12, Toys “R” Us – A Category Killer Falters
Berkowitz: Read Chapter 20, Personal Selling and Sales Management
Marketing Audit Phase #5 Due (Completed Marketing Audit) (4/29)
Course Grade:
Examinations (3 @ 100 points each)
300 points
Marketing Audit:
Phase 1: Organizational Background
25 points
Phase 2: Environ. Influences & Target Markets 40 points
Phase 3: Strategies
50 points
Specification of Problem
10 points
Completed Marketing Audit
75 points
Marketing Audit Sub-Total
Case Analysis
Content
Presentation
Quizzes
Class Participation
Total
200 points
40 points
10 points 50 points
45 points
50 points
645 points
Grading Scale:
580.5+ points =
A
580-516 points =
B
515-451.5 points = C
450-387 points =
D
386 or fewer points = F
Attendance and Participation: This is a graduate level course - attendance is not required.
However, I cannot state strongly enough that regular class attendance is encouraged.
From past experience, it is very rare for a student to perform well on exams and other
assignments if he/she has not been attending class on a regular basis. If you are absent,
please make arrangements to get copies of the notes from another student, or review the
tapes of the missed class (if available) prior to the next class. Also, please note that class
participation constitutes 50 points of the 595 points for the course. Regular attendance is
a first step towards a good participation grade. A good participation grade, however,
requires that a student be actively participating in every class session. Attendance is a
good first step, but it takes more than that to receive a good participation grade.
Reading Assignments: All reading assignments for the semester are listed in the course
outline. You are expected to have read the assignments prior to the class meeting, since
the discussion in class will assume that you are knowledgeable of the material. If it is
clear to me that you have not read the material prior to a class meeting, your class
participation score for that class meeting will be a 0.
Exams: There are three exams (see course outline for dates.) Exams will cover material
found in class and both texts. The format for the exams is approximately 75% essay, 25%
objective. I will distribute some sample examination questions to you prior to the exam to
give you a better idea of the types of essay questions I may ask. The terms which are
relevant for study are listed in the course outline. This examination format is used to
assure that students have both a grasp of the basic terminology of marketing, and an
ability to apply the terminology.
Quizzes: There are three, 15-point quizzes during the semester, specifically covering
material in the Kerin, Berkowitz, et al. text. Quizzes are intended to be taken at the
beginning of class, so please be sure to be on time on those days in which quizzes are
scheduled. The purpose of these quizzes is to make sure you are keeping up on your
reading, and to provide you with a formative assessment of the progress you are making
in understanding the material in the text prior to an examination. Three weeks prior to an
examination, I will provide you with a copy of approximately 50 multiple-choice
questions from the text. The 15 questions that will be on the quiz will be pulled from this
list. Each quiz is scheduled two class meetings prior to an examination. In this way, I
will be able to return your completed quiz to you prior at the next class so you will have
it available to you before the exam.
Case Presentations: Each student will be assigned to a group of approximately 3-4
students, depending upon the number and location of students enrolled in the course. The
cases are all found in the required text, Marketing Mistakes and Successes, 8th edition, by
Robert Hartley. Each presentation is expected to summarize the key facts of the case (not
all facts are key facts – this should take less than five minutes.) In the remaining time,
you should analyze the information in the case. The goal of your analysis is uncover
universal truths that can be applied elsewhere. A common way to approach a case is to
use an existing analytic framework, such as Porter’s influences on Industry Profitability,
or Value Chain Analysis to illuminate how the successes or mistakes of the company in
the case can provide a valuable lesson for other companies. Another approach is to take
the lesson learned in one industry and show how the basic business model can be applied
in a different industry. To give you a better idea of what I’m expecting, I will personally
take the first presentation of the semester (the case on Airbus and Boeing). If you are not
presenting a case, you are still expected to read the case and come to class prepared to
participate in the case discussion.
As a part of your presentation, you should submit three items to me for grading
1.
A written summary of your presentation, limited to two pages in length. (focus
on your analysis, not reciting facts in the case.)
2.
A copy of your PowerPoint slides (you can send these to me via e-mail or in
print.)
3.
A brief statement (300 words or less) of one major point from your
presentation that would be valuable for people in other industries to
understand. This should be sent to me via e-mail within 48 hours of
completing your presentation (i.e., you’ll do this part last – you will probably
have a draft done before your presentation, then revise it after your
presentation before e-mailing it to me.) I will collect these as the semester
progresses, with hopes of distributing your advice to a wider audience.
What if I Need Help? If you find you are struggling, please see me as soon as possible.
WIU has many resources to help you succeed, and I will also do what I can to help you
learn the material. If you will be absent from class due to participation in work activities,
see me early in the semester. Also, if you have a disability which requires
accommodation, please see the office of disability services early in the semester. Finally,
feel free to call or stop by my office during scheduled hours, or contact me outside of
class whenever you have questions. Remember, the sooner you see me with any problems
you are having, the sooner we can work together to help you master the material.
MKTG 516 Project: The Student Marketing Audit
One of the requirements of MKTG 516 is to perform a "marketing audit" of an
organization. You may select either a for-profit or a not-for-profit organization, and the
business can be either a local or national organization. If you are already employed, you
may find it easier to complete the marketing audit on your business. You can also choose
to perform the audit on a business for which you would like to work. (It can be a great
way to "get a foot in the door!") The purpose of this assignment is for you to become
familiar with the marketing environment and the marketing strategy decisions for a
particular organization, and then to address a particular marketing problem confronting
the organization. As the semester progresses, you should be able to see how the material
covered in class and in the text applies in a real-world setting.
You will be required to submit one copy of your project to me, and another copy to the
organization. Please be sure to notify your organization that all information presented in a
marketing audit will be confidential. Also, please notify your organization that they will
be asked to complete a brief (1-2 pages) survey at the completion of the project.
PHASE #1: THE ORGANIZATION AND ITS BACKGROUND (3-5 pages
minimum)
In Phase #1, please supply the following information:
Organization Name and Address
Source of Marketing Information. For example, if it is a local/regional business provide
the name/title/phone number of the person with whom you spoke. If you are working
with a national/international organization, specify the source of your information.
Type of Organization and Brief Background What kind of business is it? What types of
products/services does the business sell? How long have they been in business? A brief
history of the business is appropriate here -- you should assume that the reader has no
familiarity with the particular business. You should also supply as much background
information as possible, such as current sales, number of locations, # of employees,
growth in sales, number of customers: any information which helps to provide a complete
picture of the organization.
Product/Service to Be Examined. Describe the types of products sold by the business, and
the product(s) you will be examining. For a small business, you may be able to examine
the entire organization. For larger organizations, you may need to focus on a specific
product line. Provide as much history and detail as possible concerning the area you will
be examining.
Try to select an organization which is interesting to you (this is a good opportunity to
meet people in a field in which you would like to work!). Be sure that you will be able to
access the information you need -- this will typically involve interviewing a marketing
contact at the organization.
In each phase of the project, you must cite the sources of your information. If you
obtained information from an employee of the company, you must provide the
employee's name, title, and work phone number (so I can verify the information at a later
time, if necessary). If the source of information is magazine articles, brochures, or
company documents, cite the articles.
You must prepare this information using a word processor (you will need to edit it later).
The format should contain each of the four headings listed above (list each heading), and
the document should be double spaced, with page numbers, your name and student ID
(i.e., SSN) in the upper right hand corner, and all headings underlined. Remember to
check your grammar and spelling. Please staple (no folders yet, please), and turn in on the
assigned date. BE SURE TO KEEP THE PAPER AFTER I HAVE GRADED IT -- You
will need it and the feedback for subsequent versions of the paper.
PHASE #2: ENVIRONMENTAL INFLUENCES AND TARGET MARKETS (5
additional pages minimum)
Organization Name and Address
Source of Marketing Information
Type of Organization and Brief Background
Product/Service to Be Examined. Items 1-4 are repeats from Phase #1 - Please review the
corrections and comments cited on Phase #1 and incorporate those here, then add the
following new material.
Major Environmental Influences (for your selected product/service)
What are the major economic factors which influence this
a. Economic:
organization, and how do they influence it? Be specific: What do
changes in economic factors such as interest rates, unemployment,
or income mean to the organization?
How has technology affected the business in recent years? How is
b. Technological:
technology expected to affect the business in the future?
Have changes in society affected the business? (e.g., more working
c. Social:
women, greater interest in fitness, social class consciousness)
How has government regulation affected the business in recent
d. Political/Legal:
years? Are future changes in this area anticipated? Does the
business work with any legislators, lobbying groups, etc.?
Who are the major direct and indirect competitors, and what is their
e. Competitive:
relative size and strengths? Describe the structure of the industry
(barriers to entry, profitability, level of competition).
Target Market(s) (for your selected product/service) Who is the business trying to sell its
products/services to? Note that this is different than who the current customers are.
a. Method of defining target market (How does the business define who is in the target
market? Is it by demographics, usage rate, etc.)
b. Estimated size of the market (including basis for estimate). If the business is using
demographics, you can frequently determine the size of the market by using the US
Census data available in the library. You must estimate the size of the businesses target
market.
Use the same format as you used in Phase #1: Use each of the six headings listed above,
double spaced, page numbers, your name and student ID (i.e., SSN) in the upper right
hand corner, and all headings underlined. Remember to check your grammar and
spelling. Please staple this document and include it in a folder with the marked-up copy
of Phase #1 (so I can see if you have made the suggested changes from Phase #1), and
turn in on the assigned date. Again, BE SURE TO KEEP THIS PHASE OF THE
PROJECT AFTER I HAVE GRADED IT -- You will need it and the feedback for
subsequent versions of the paper.
PHASE #3: THE MARKETING MIX (6 additional pages min.)
Organization Name and Address
Source of Marketing Information
Type of Organization and Brief Background
Product/Service to Be Examined.
Major Environmental Influences
Target Market(s) Items 1-4 are repeats from Phase #1, and items 5-6 are repeats from
Phase #2 - Please review the corrections and comments cited on these phases and
incorporate those changes here, then add the following new material.
Product Strategy. Describe the assortment of products and services provided. What
motivates buyers to purchase this product/service? How does the organization compare
against its competition (both perception and reality)? In relation to the target market,
what does the organization do that is superior to the competition? Take each major
competitor and analyze the relative costs/benefits derived from buying your company's
product vs. the major competitors. Be specific here -- it is not enough to say the business
provides "superior service" -- you must indicate how this is achieved.
Pricing Strategy. What is the pricing strategy for the product/service? Is pricing done on a
cost-plus basis? Are prices set according to what competitors are charging? Are prices set
according to what customers are willing to pay? Are there restrictions on pricing
decisions?
Promotional Strategy. Describe the promotional strategy: What is the message that is
being communicated, when is it communicated, and how is the message being
communicated? You should discuss advertising, sales promotion, personal selling and
public relations efforts in this section. Don't overlook such promotional tools as directory
advertising, outdoor advertising, word-of-mouth, exterior and interior signage, etc.
Distribution Strategy. Describe the distribution strategy. For retailers, how are suppliers
selected? Who handles the product between the manufacturer and the retailer? What
services do they provide? If there is no traditional channel of distribution (this may be the
case for many service and not-for-profit organizations,) focus on the location of the
business -- why are they located where they are?
Again, use the same format as you used in Phases #1 & 2: Use each of the ten headings
listed above, double spaced, page numbers, your name and student ID (i.e., SSN) in the
upper right hand corner, and all headings underlined. Remember to check your grammar
and spelling. Please staple this document and include it in a folder with the marked-up
copies of Phase #1 and Phase #2 (so I can see if you have made the suggested changes),
and turn in on the assigned date. Again, BE SURE TO KEEP THIS PHASE OF THE
PROJECT AFTER I HAVE GRADED IT -- You will need it and the feedback for
subsequent versions of the paper.
PHASE #4: SPECIFICATION OF THE MARKETING PROBLEM
After compiling the above information, you should analyze your own work and clearly
define an important marketing-related problem facing the organization. This will be done
in class, with feedback from the instructor to assist you in developing a tight and
reasonable definition of the marketing problem. The problem you select should be a
natural outgrowth of your preceding marketing audit. It may be a problem in how the
organization responds to a particular environmental influence, how it defines its target
market, or in one of the strategies (product, pricing, promotion, or distribution) in use by
the organization. Be careful here that the problem you identify meets the following
criteria:
A. Is the problem real? (i.e., Would the owner or customers of the business concur that
the problem you are identifying is a real problem?)
B. Is the problem of some significance? Does solving the problem lead to enhanced
profitability or increased customer value?
C. Is the problem related to marketing? (e.g., no HRM, managerial style, or cash flow
problems)
D. Is the problem solvable? Be sure that the problem can be solved.
PHASE #5: COMPLETED PROJECT
Using feedback from the instructor and from knowledge you have gained from class, you
should now revise Phases #1 and #2 to create a concise marketing audit of the company.
You should then clearly state the problem to be solved along with your proposed solution
to the problem. The solution should include the following:
 Statement of the problem
 Significance of the problem
 Proposed solution
o The actions to be taken
o The resources required
o Timeline for solving the problem
o Implementation
This audit should be at least 15-20 pages in length, double spaced, and professional in
appearance. YOU SHOULD PLACE THIS FINAL PROJECT IN A BI-FOLD FOLDER
(the kind with two pockets on the inside) TOGETHER WITH THE ORIGINAL COPIES
OF PHASES #1 AND #2 (I want to check to see whether you made the changes I
originally suggested.)
The final project should take the following form:
Final Project
1) Organization Name and Address
2) Marketing Contact/Title/Phone Number
3) Type of Organization and Brief Background
4) Product/Service to Be Examined
5) Major Environmental Influences
a) Economic
b) Technological
c) Social
d) Political/Legal
e) Competitive
6) Target Market(s)
a) Method of defining target market
b) Estimated size of the market
7) Product Strategy
8) Pricing Strategy
9) Promotional Strategy
10) Distribution Strategy
11) Marketing Problem
a) Statement of the problem
b) Significance of the problem
c) Proposed solution
i) The actions to be taken
ii) The resources required
iii) Timeline for solving the problem
iv) Implementation