Chapter 1
Over view of marketing
What is marketing?
Marketing is an organizational function and set of process for creating, capturing, communicating,
delivering value to customer and for managing customer ralationship in ways that benefit the organization and
its stakeholders and firms should develop a marketing plan.
Marketing plan : plan that specify the marketing activity for a specific period of time which can be
broken down into various components
1. How the product designed
2. How much it should cost
3. Where and how it will promoted
4. How it will get to the customer
Core Aspects of marketing
Marketing is about satisfying customer needs and wants
: good marketer seek potential customer who have both an interest in product and ability to buy
Marketing entails an exchange
Exchange is the trade of things of values between buyer and seller
Marketing require
Marketing plan (4Ps)
: controllable set of activity that firm use to respond to the want of its target
market : product, price, place, promotion
Product  by developing goods, service, idea to satisfy customer need
Price  is everything buyer gives up – money, time , energy
Place  to get product to the right customer when that customer want it
Promotion  marketer inform, persuade, remind potential buyer about a product to influence their
0000000000000000000opinion or elicit a response
Marketing can be performed by both individual and organization
- Business selling merchandise to another is called business to business (B2B)
- Business sell to consumers is known as business to consumer (B2C)
- Consumers sell to other consumers known as consumer to consumer (C2C)
Market impact various stakeholders
Partners in the supply chain include wholesaler, retailer, transportation or warehousing co.
Marketing helps create value
>>Production-Oriented Era
: before 1920, most firms were production oriented and believed that a good product would
sell itself (concern with product innovation, not satisfying the need of consumer)
>>Sales-Oriented Era
: 1920-1950, Great Depression and world war II conditioned customer to consume less (firm
heavy use of personal selling and advertising)
>>Marketing-Oriented Era
: after world war II, customer became king. Customer had choices and able to make
purchasing decision on the basis of factor such as quality and price.(firms focus on what consumers wanted)
>>Value-base marketing Era
: value reflects the relationship of benefit to cost or what you get for what you give
:before the turn of the 21st century, firm would have to give their customer greater value than
their competitor did
Chapter 2
Developing Marketing Strategies and a Marketing plan
What is a marketing strategy
: identify
1.firm’s target market
2.a related marketing mix (4Ps)
3.base on firm plan to build
Sustainable competitive advance
 Is an adventage over the competitor, that is not easily copied and can be maintained over a longer
period of time
 1.) Customer excellence : focus on retaining loyal customer and provide outstanding customer
service.
 2.) Operational excellence : is achieved through efficient operation, excellence supply chain, human
resource management
 3.) Product excellence : occur by having a good physical location and internet presence
The marketing plan
Is a written document composed of an analysis of the current marketing situation, opportunity and
threat for the firm, marketing adjective and strategy specified in term of four P’s.
strategic marketing planning process
Define business mission
1.Mission statement  attempt to answer 2 main questions
1.1) What type of business are we?
1.2) What do we need to do accomplish our goal and pbjective
2.Conduct situation analsuing using SWOT
SWOT  internal environment = Strength and weakness
External environment = Opportunity and threat
Identifying and evaluating opportunity using STP (segmentation, targeting, positioning)
>>Market segmentation : process of dividing the market in to subgroups with different need, want,
characteristic
>>Market segment : cinsisting of consumer who respond simiraly to firm’s marketing effort
>>Targeting : evaluate each segment’s attractiveness and decide which to pursure
>>Marketing positioning : process of defining the marketing mix variable so that target customer
have a clear, distinctive, desirable understanding of what product does or represent in comparison
with competing product
4.skip
5.Evaluate performance using marketing matrix
Boston consulting group’s portfolio analysis : classify all their products into a two-by-two matrix
Boston consulting group’s portfolio analysis : classify all their products into a two-by-two matrix
- Horizontal axis represent relative market share measure of product’s strength in a particular
market, which we define as the sales of the focal product divided by the sales achieved by the
largest firm in the industry
- Vertical axis is market growth rate, for measures how attractive a particular market is
Star = high growth market rate and high market share product
- Require heavy investment such as promotion and new production facility to fuel their rapid
growth
Question mark = high growth market rate but low market share product
- Required significant resource to maintain and increase market share
Cash cow = low growth market and high market share product
- Have excess resource that can be spun off to those products that need
Dog = low growth market and low market share
- Company has decided to stop making (phased out)
Growth strategy
1.Market Penetration strategy
: strategy employ the existing mix and focus the firm’s effort on existing customer
: by encouraging current customer to patronize the firm more often or buy more merchandise on each
visit
: greater marketing effort such as increased advertising, additional sales and promotions, or
intensified distribution
2.Maket Development Strategy
: strategy employ the existing marketing offering to reach new market segment, whether domestic or
international ex,starbuck/kfc/MCdonald’s
3.Product Development Strategy
: strategy offer a new product to a firm’s current target market ex.sony, iphone and adidas
4.Diversification strategy
: strategy, introduce a new product to new market segment that currently is not served (may be either
related or unrelated)
Chapter 5 Analyzing the marketing environment
The immediate environment
1. Company
- The first factor the effects the customer
- Focus on satisfying customer needs that match their core compencies (
Existing knowledge, facilities, patents, etc.
2. Competitors
- Know strengths, weaknesses of competitors
- Proactive rather than reactive strategy
3. Corporate Partners - Alliances
- Align with competitors, supplies
- Just in time delivery systems (JIT)
Macroenvironment
1. Culture – The shared meaning, beliefs, morals, values and customs of group of people
1.1 Country culture – Artifacts, behaviors, dress, symbols, physical settings, ceremonies, languages,
colors and testes, food preferences
1.2 Regional culture – Affect people who live in a particular region
2. Demographics – The characteristics of human populations and segments especially those to identify
consumer markets
- Snapshot of the typical consumer in a specific target market
2.1 Income – Purchasing Power
2.2 Gender – Male/Female roles have been shifting
2.3 Education – High income tends to high purchasing power
2.4 Ethnicity – Ethnic and racial groups
3. Social Trends
3.1 Thrift – Spend less, save more
3.2 Health and Wellness concerns
3.3 Greener Consumer – environmentally friendly
3.4 Privacy Concerns – sense a loss of privacy
3.5 Time-poor society – use more applications
4. Technological Advances
- Applications
- save time
- provide immediate information
5. Economic
- Currency rates
- Inflation
- Interest rates
6. Political/legal
- drinking age
- prohibition
CHAPTER 6
CONSUMER BEHAVIOR
1.Need recognition
-The customer recognize what they need divided into 2 things
-functional needs - needs that pertain to the performance of a product or service
-psychological needs -Needs that pertain to the personal gratification consumers associate with a product
and/or service
2.Search for information
-internal search Gathered through PAST EXPERIENCE
-external search The buyer seeks information OUTSIDE his/her personal knowledge base to help make the
buying decision.
Factors Affecting Consumers’ Search Process
1. Perceived benefits vs. perceived costs of search Is it worth the time and effort to search for information
about a product or service?
2. Actual or perceived risk
-performance risk The perceived danger inherent in poorly performing product or service
-Financial risk enough money to purchase or not
-Social risk The fear that consumer suffer when they worry others might not regard their purchase positively
-PHYSIOLOGICAL RISK (SAFETY RISK) The fear of an actual harm when the product does not perform
properly (also include health risk)
-PSYCHOLOGICAL RISK Associated with the way people will feel if the products or services do not convey
the right image
3. Evaluation of Alternatives
-Occur while the consumer engaged in the process of information search
4. Purchase and Consumption
-The consumers don’t always patronize the store or purchase what they had originally decided
5. Postpurchase
-Feeling after purchasing or consuming product and service
-3 postpurchase outcomes
-1. CUSTOMER SATISFACTION Comparing between CUSTOMER EXPECTATION and PRODUCT
PERFORMANCE
-2. POST PURCHASE COGNITIVE DISSONANCE Occurs when a consumer questions the appropriateness
of a purchase after his/her decision has been made
-3. CUSTOMER LOYALTY LOYAL CUSTOMERS buy only certain brands and shop at certain stores
Factors Influencing the Consumer Decision Process
-1. PSYCHOLOGICAL FACTOR motives Need or want that is strong enough to cause the person to seek
satisfaction ,
-2.Social factors FAMILY Family members often influence buying decisions. Thus, firms must consider.
REFERENCE GROUPS One or more persons whom an individual uses as a basis for comparison regarding
beliefs like a celebrity . CULTURE The shared meanings belief, morals, values, and customs of a group of
people.
-3.Situational factors PURCHASE SITUATION Customers may be predisposed to purchase certain products
or services because of CHANGING IN CERTAIN PURCHASE SITUATION. SHOPPING SITUATION
Consumers might be ready to purchase a product or service, but be completely derailed once they arrive in the
store
Involvement and consumer buying decision
-High-involvement Greater attention Deeper processing
-Low-involvement Less attention
Type of consumer buying decision
• Extended Problem Solving Customers perceives that the purchase decision entails a lot of risk
• Spend time and effort a lot to searching for information
• To reduce risk (financial ,social and etc.)
Chapter 9 Segmentation, Targeting and Positioning
The segmentation,targeting and positioning process
Step 1 : Establish overall strategy or objectives
Step 2 : Segmentation methods
- Geographic
- Demographic
- Psychographic
- Benefits
- Behavioral
Step 3 : Evaluate segment attractiveness
- Identifiable
- Substantial
- Reachable
- Responsive
- Profitable
Step 4 : Select target market
1) Undifferentiated targeting strategy
2) Differentiated targeting strategy
3) Concentrated targeting strategy
4) Micromarketing
Step 5 : Develop positioning strategy
Chapter 10 Marketing Research
Marketing research is a prerequisite of successful decision making. It consists of a set of techniques
and principles for collecting, recording, analyzing and interpreting data that can aid decision makers involved
in marketing goods, services or ideas.
Marketing research process
Step 1 : Defining objectives and research needs (What problem needs to be solved)
Step 2 : Designing the research (Identify the type of data needed and determine the research necessary
to collect it.)
Step 3 : Data collection process (Data collection begins only after the research design process)
1) Secondary data : A marketing research project often
relevant secondary data.
Syndicated external secondary data
- Syndicated data
- Scanner data
- Panel data
Internal secondary data
- Data warehouses
- Data mining
2) Primary data :
begins with a review of the
2.1) Qualitative research
- Observation
- Social media
- In-Depth interviews
- Focus group interviews
2.2) Quantitative research
- Experiments
- Survey
- Scanner
- Panel
Step 4 : Analyzing data and developing insights (To generate meaningful information, researchers
analyze and make use of the collected data)
Step 5 : Action plan and implementation
CHAPTER 11
Product, Branding, and Packaging Decisions
Complexity and Types of Products
Marketers change core customer value which defines the basic-problem solving benefits that
consumers are looking for into an actual product, attributes such as the brand name, design, quality level and
packaging are important but the level of their importance varies depend on the products and the associated
services or can be called as the augmented product such as product warranties, financing, product support, etc.
So when developing or changing a product, marketers will start with the core consumer value then make the
actual product and add associated services to round out offering.
Types of Products
Consumer Products: Used by people for their personal uses. (Final User)
 Specialty Products/Services: The products which customers express a strong preference that they
will use a lot of time to search for the best suppliers, for examples ; Luxury Car and medical
professionals. This doesn’t mean the products are expensive but they might be significant to the
consumers.
 Shopping Products/Services: The products that consumers spend a fair amount of time to compare
the alternatives such as fragrances, furniture, or travel alternatives.
 Convince Products/Services: Customers don’t have to spend too much time thinking before buy
these products which as, such as bread, soap, or common beverages.
 Unsought Products/Services: The products that consumers either don’t think of buying or don’t
know about them such as insurance or new GPS system.
Product Mix and Product Line Decisions
Product Mix is the complete set of all products and services offered by a firm. Product mix consists
or various product lines, a group of associated items that consumers tend to use or think of as part of a group
of similar products or services.
Product mix reflects the breadth and depth of each product line.
Breadth: a count of the number of product lines offered by a firm.
Depth: The number of products within a product line.
Why do firms change their product mix’s breadth or depth?
Increase Depth: Firm add items to address changing consumer preference or to preempt competitors while
boosting sales. For example, Axe expands its fragrance product line to create a version for women.
Decrease Depth: Firms sometimes delete their product to eliminate unprofitable items and only focus on the
ones that make more profit.
Decrease Breadth: Decrease entire product to meet the changing market conditions and the internal strategic
priorities
Increase Breadth: Add new product to capture or evolve the new markets and increase sales.
Branding
A way that firm can use to make their products different from the competitors and also help the
customers to know what products exist under brand awareness.
Brand element
Brand name
Description
Word(s) that identify not only a product but also
its manufacturer or producer such as Apple, CocaCola or IBM.
URLs
Logos or Symbols
Characters
Slogans
Jingle/Sounds
The location of pages on the internet
Logos are virtual branding elements, stand for
trademark or corporate names. Symbols are logos
without words.
Brand symbols that could be humans, animals or
animated.
Short phrases used to describe the brand or persuade
consumers about some characteristics of the brand.
Audio messages about the brands.
Value of branding for the customers
 Brands Facilitate Purchases: As brands signify a certain level and contain familiar
attributes, they help the consumers to make quick decisions. For example, Pepsi which some
people might think it’s just cola but branding makes it easy for Pepsi drinkers to find similar
logo on the store shelf and might help them buy more Pepsi’s other products.
 Brand Establish Loyalty: Consumers learn to trust their brands and wouldn’t consider
switching brands
 Brands protect from competition and price competition: Some brands which are very
strong in the markets can compete with the competitors that produce similar products
because they have their loyal customer base.
 Brands Are Assets: Brands are firms’ assets that they have to make sure no one uses their
brand names.
 Brands Impact Market Value
Brand Equity for the Owner
The value of brand or the set of assets and liabilities linked to the brand. To determine its equity,
experts look at 4 aspects of a brand which are brand awareness, perceived value, brand association, and brand
loyalty.
Brand Awareness: It measures the number of consumers in a market know about the brand and have an
opinion about it. When the brand names start being used as the generic products category, they become the
synonyms with the products itself.
Perceive Value: The relationship between a product’s benefit and its cost. If people believe a less expensive
brand is about the same quality as a premium brand, the perceived value of the cheaper one is high.
Brand Associations: Brand association is anything which is deep seated in customer’s mind about the brand
Brand associations are formed on the following basis:
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Customers contact with the organization and its employees;
Advertisements;
Word of mouth publicity;
Price at which the brand is sold;
Celebrity/big entity association;
Quality of the product;
Products and schemes offered by competitors;
Product class/category to which the brand belongs;
POP (Point of purchase) displays; etc.
Brand loyal consumers are the foundation of an organization: Greater loyalty levels lead to less marketing
expenditure because the brand loyal customers promote the brand positively. Also, it acts as a means of
launching and introducing more products that are targeted at same customers at less expenditure. It also
restrains new competitors in the market. Brand loyalty is a key component of brand equity.
Brand loyalty can be defined as relative possibility of customer shifting to another brand in case there is
a change in product’s features, price or quality. As brand loyalty increases, customers will respond less to
competitive moves and actions. Brand loyal customers remain committed to the brand, are willing to pay
higher price for that brand, and will promote their brand always.
Branding Strategies
 Brand Ownership:
Two basic brand ownership strategies; manufacturer and retailer/store brands.
Manufacturer Brands (National Brands)
To attract and retain satisfied customers to one particular good, a manufacturer markets a good or
family of goods under its own brand name(s). Loyalty may otherwise transfer to the manufacturer's
other products in the same product family such as Nike, Sony and Apple.
Retailer/Store Brands (Private-Label brands): Retailers want to sell the products by their own.
They develop their own products with designs then contact the manufacturer to produce them such as
Big C or Seven-Eleven.
Naming Brands and Product Lines
Family Brands
Family branding is a type of marketing tactic. It involves using one brand name to market multiple
products. For example, a company may use one brand to market soap, lotion, hair shampoo, and nail
polish.
Individual Brands
Branding individual products involves giving each product its own name and image. For example, a
company may sell lipstick and nail polish, giving each product lines a separate marketing identity.
Brand and Line Extensions
Line Extension
Line extension refers to the expansion of an existing product line. For instance, a soft drink
manufacturer might introduce a "Diet" or "Cherry" variety to its cola line, while a toy manufacturer might
introduce new characters or accessories in its line of action figures. In short, line extension adds variety to its
existing product for the sake of reaching a more diverse customer base and enticing existing customers with
new options. “Same brand name, different product line”
Brand Extension
Brand extension refers to the expansion of the brand itself into new territories or markets. For
instance, if a soft drink manufacturer unveils a line of juices or bottled water products under its company
name, this would constitute an example of brand extension. The brand, or company, is an established name,
and so the name alone can serve to drive customers to try new products completely unrelated to the older
product lines. “Same brand name, same product line”
Benefits
A line extension can reinvigorate a product line, bringing it back into the public awareness by drawing new
customers and higher profits. A brand extension can increase profits by allowing manufacturers to tap into
new markets and offer increased diversity in their inventory. Line extensions and brand extensions both allow
companies to promote new products with reduced promotional costs because the new lines or brands benefit
from being part of an established name.
Risk
Brand dilution is the weakening of a brand though its overuse. People might get confuse about the
perceptions on the products. For example, Cheetos make a chess flavored lip-palm.
Co-Branding
Co-branding is the practice of using multiple brand names together on a single product or service. The
term can also refer to the display of multiple brand names or corporate logos on a single Web site, so that
people who visit the site see it as a joint enterprise. When effectively done, co-branding provides a way for
companies to combine forces so that their marketing efforts work in synergy. For example; A&W beverages
and Pizza Hut, Coca-Cola and MC Donald’s
Brand Licensing
The leasing of a brand name to a company other than the owner of that particular brand. As an
example, a beer company located in Europe could lease its brand name to an American brewer.
Brand repositioning
is changing a brand's status in comparison to that of the competing brands. Repositioning is effected usually
through changing the marketing mix in response to changes in the market place, or due to a failure to reach the
brand's marketing objectives.
Packaging
Primary packaging is the material that first envelops the product and holds it. This usually is the smallest unit
of distribution or use and is the package which is in direct contact with the contents such as shampoo bottle
or toothpaste tube.
Secondary packaging is outside the primary packaging, perhaps used to group primary packages together
such as wrapper or exterior carton.
Product Labeling
A display of information about a product on its container, packaging, or the product itself. For
several types of consumer and industrial products, the type and extent of information that must be imparted by
a label is governed by the relevant safety and shipping laws.