MAR 3023 Exam 1 review

Marketing Definition

"Marketing is the process by which companies determine what products or services may be one of interest to customers, and the strategy to use in sales, communications and business development." - Phil Kotler

Societal Marketing Era (1960s-present)

"green marketing" focus on: - adds society's best interest into the mix - corporate social responsibility - *firms now serve 3 entities* *-- customers, stockholders, society as a whole*

A Marketers View of Marketing

"the aim of marketing is to know and understand customers so well the product or service fits them and sells itself" - Peter Drucker so marketing is really all about products and customers

Intro to Marketing Strategy

(recap) 1. marketing is about developing great products that people want/need, pricing them at a level that maximizes profits, and getting them to consumers 2. over time, competitors imitate ideas *EX: Coke Zero* - targeted towards men; doesn't have the word "diet" on it and research shows that men don't like to drink drinks that have the word "diet"; the same goes for Europeans because they don't like the word "diet"; Coke sponsors football and NASCAR; they were imitated by Pepsi who came out with a very similar product 3. this creates a need to convince and reminds customers that our product is different, better, and more socially acceptable than other, similar products 4. marketers are really good at convincing and reminding

Marketing Results (examples)

*EX: Blockbuster* stock price - Blockbusters stocks went straight in the tank around 2004/2005 when other options like Redbox came out - now Blockbuster is out of business and they should be because they were not treating customers the way customers should be treated *EX: Amazon* stock price increasing *EX: Costco* stock price increasing *EX: Sears* - used to be great, now stock price going straight down and going out of business *EX: Fitbit* - stock price went down when the Applewatch launched

Internal Marketing

*EX: Chick-fil-A* - Dan Cathy, the CEO and founder's son: -- works one day a year in the store -- invites all new franchise operators to his home where he cooks and cleans up -- sometimes camps outside new stores with customers -- this resonates with their target employees *EX: Southwest airlines* - flight attendant rap video, and safety instructions -- employees are empowered to entertain customers

"game changer" processes

*EX: McDonalds* - put fast food on a production line . . . a system that all fast food restaurants now use - they revolutionized how we think about fast food -- Glenn Bell went to the McDonalds brothers and bought their system to turn tacos into a production line --> and turned into Taco Bell

"game changer" pricing/distribution

*EX: Redbox* (before was Blockbuster) - initially funded by McDonalds -- as a result, Blockbuster went out of business . . . and now we have Netflix

the 4 P's of marketing:

*Product* - goods, services, ideas *Place/Distribution* - make products available in quantities desired *Price* - decisions and actions associated with establishing price objectives and policies *Promotion* - inform individuals or groups about the organization the term 4 P's was first coined by Jerome McCarthy in his 1960 book Basic Marketing: A Managerial Approach

History of Marketing

*Simple Trade Era* (pre-Industrial Revolution) *Production Era* (1860s-1920s) *Sales Era* (1920s-1940s) *Marketing Department Era* (1940s-1960s) *Marketing Company Era* (1960s-1990s) *Relationship Marketing Era* (1990s-2010) *Social/Mobile Marketing Era* (2010-present)

Ethical Issue in Place

*cereal box psychology* - average adult cereal is placed twice as high as children's cereals - most children's cereal characters look down at a 9.6 degree angle, while adult cereal characters look straight ahead - eye contact, even with inanimate characters, increases trust by 16%

Technological Forces

*continual adaption to new technology* EX: A-track player; then came cassettes and CDS; then iPod came out; moving forward, music player technology will be as small as a grain of rice - companies have to adapt to what technology is doing EX: Google Duplex is scary good at simulating real conversations (AI)

Clues to a Market Orientation

*customer centric marketing* collaborative relationships based on customer's individual needs and concerns [main focus of sales industry] *relationship marketing* long term mutually satisfying, buyer-seller relationships *customer relationship management* using information about customers to develop and sustain desirable customer relationships *green marketing* meaningful long term relationships while maintaining, supporting, and enhancing the natural environment

Pyramid of CSR

*economic (bottom)* - be profitable -- the foundation upon which all others rest *legal* - obey the law -- law is society's codification of right and wrong -- play by the rules of the game *ethical* - be ethical -- obligation to do what is right, just, and fair -- avoid harm *philanthropic (top)* - be a good corporate citizen -- contribute resources to the community; improve quality of life

Key to Internal Marketing

*empowerment*: giving employees the power to act immediately, decisively, and without fear in order to attain satisfaction and delight EX: Nordstrom - "use your good judgement, that's the only rule" EX: USAA - some 60% of the agents who answer investment queries can respond to insurance-related calls EX: Marriot trains administrative assistants to step in as banquet servers when needed

Production Era (pre-1920s)

*firms produced what they could make* EX: "you can buy any color Model T ..." - inward focus - technical development -- Henry Ford, Rockefeller, etc. --> these guys were making loads of money because they were able to produce products in mass quantities in a way that wasn't possible before -- options at the time were grow it or make it yourself versus buy it from someone else there was a seller's market and demand certainly exceeded supply because people were dying for Model T's - around 1920, something changed ... what happened? --> the Great Depression ---> supply now exceeded demand because people didn't have any money and people became very risk averse

The Marketing Era (1940s-1990s)

*focus on customer orientation* the "great awakening" where customers became the central focus of the organization began with the development of marketing departments (1940-1960) and then transferred to the rest of the firm (1960-1990) focus on: - customer is the key -- "delight" - make what we sell

Popular Macro-Marketing Strategies

*identifying opportunities* *creating:* - *value* - *relationships* *segmenting markets:* - departments - course delivery

Internal and External Marketing

*internal marketing*: company -- employee *external marketing*: company -- customer

Subliminal Perception

*is it real or not?* - in 1957, market researcher James Vicary claimed that quickly flashing messages on a movie screen had influenced people to purchase more food and drinks -- Vicary used a tachistoscope to project the words "drink Coca Cola" and "hungry? eat popcorn" for 1/3000 of a second at 5-second intervals -- sales of popcorn and Coke in that New Jersey theater increased 57.8% and 18.1% - however, in 1962, Vicary admitted to lying about the experiment and falsifying the results -- *in reality, this only works in very controlled (and hence unrealistic) environments*

Ethical Issues in Promotions

*manipulative or deceptive sales promotions, tactics, and publicity* *false or misleading advertisements* EX: Maybelline's mascara advertised that it increased fullness by 8 times --> they got in trouble for "8x" EX: ads vs reality for fast food *greenwashing* when products are promoted as being more environmentally friendly than they really are - organic cotton is only included in the outer cover - the cotton that touches the child is not organic - packaging is only 20% post-consumer material - Huggies doesn't sell a single biodegradable diaper

Successful SBUs

*market share*: the percentage of the market that actually buys a specific product - iPhone has 39% of the US market; Samsung has 28% - AB/InBev is the world's largest beer maker with 28% of the worldwide market

Ethical Issues in Products

*marketers fail to disclose: * - risks associated with the product - information regarding the function, value or use of a product - existing conditions or changes in product quality EX: Juul CEO issues stark warning 'Don't vape. Don't use juul' - he admits long-term effects of vaping are unknown

Competitive Structure

*monopoly* when an organization has no competitors so that it is the sole source of supply (illegal) EX: Microsoft was accused of this in relation to bundling IE (Internet Explorer) and squeezing out Netscape - Microsoft lost the case and ultimately settled *oligopoly* when a few sellers control supply - usually due to entry barriers EX: the airplane industry - high entry barriers because not a whole lot of people can afford to buy a fleet of planes *monopolistic* when a firm in competitive industries attempt to differentiate a product - a "normal" market (most common) EX: FSU *pure competition* exists when there are a large number of sellers with similar products and low barriers to entry EX: farmer's market; Ebay - anyone can get on Ebay and sell what they have

Organizational Mission

*our vision* to be a preeminent College of Business in the areas of teaching, research, and service *our mission* to be a thought leader in business research and to teach students innovative ways to leverage risk management, entrepreneurial expertise and the spectrum of business disciples to create ethical, sustainable solutions

Volkswagen CSR (2015)

*problem* a new emissions control was implemented to reduce the negative impact automobiles had on the planet *solution* Volkswagen developed software that would allow their vehicle to shift from test mode (thus allowing the car to pass an emission test), to "dirty mode" which emitted 40 times the legal limit of nitrogen oxide

Simple Trade Era (pre-1860s)

*products were made by hand, grown, or traded in small quantities* lasted up until the Industrial Revolution

Sales Era (1920s-1930s)

*sell what we make* "changing their minds" focus on: - sell what we make - aggressive promotion -- vacuum cleaners short-term profit maximization

CSR Issues (chart)

*sustainability* consumers insisting not only on a good quality of life but on a healthful environment so they can maintain a high standard if living during their lifetimes major social concerns: - conservation - water pollution - air pollution - land pollution *consumerism* activities undertaken by independent individuals, groups, and organizations to protect their rights as consumers major social concerns: - the right to safety - the right to be informed - the right to choose - the right to be heard *community relations* society eager to have marketers contribute to its well-being, wishing to know what marketers do to help solve social problems major social concerns: - equality issues - disadvantaged members of society - safety and health - education - general welfare

Great Products

*the first goal of marketing is to identify unmet consumer needs and then develop products that fill those needs* the days of being able to tell customers they can only have black are long gone, right? - wrong -- it happened again with the new Tesla Model 3 (black was free, every other color had a $1000 upcharge)

Campbell's Soup CSR

*the problem* - the South Jersey Food needed to raise revenue to buy more food for homeless and hungry people in South Jersey - meanwhile, farmers in New Jersey pay to bury 80,000 lbs of peaches because they don't meet the consumer standards for cosmetic appearance *the solution* - "just peachy salsa" -- the food bank buys the blemished peaches for pennies on the dollar; this saves farmers from paying the disposal fees -- Campbell's donates the manufacturing and packing costs, and employees volunteer time to box and pack jars -- in 2014, this program generated over $100,000 in profit for the food bank

Competitive Forces

*types of competitors:* - brand competitors EX: Coca-Cola vs. Pepsi - product competitors EX: Dasani vs. Snapple - (something similar) in this case, another beverage product - generic competitors EX: Beer, Cola - not branded, in some product space - total budget competitors -- you have a fixed amount of money EX: if you have a $1.50 to spend at BusyBee, you can't get a soda and a candy bar, you have to choose one

Ethics Violations

*violations in accepted marketing ethics can negatively influence the exchange process by: * *- violating trust* *- increasing customer dissatisfaction* *- lawsuits*

unethical, illegal or okay?

- sued by one customer who said the sunscreen "didn't work" (Jessica Alba's The Honest Co. sunscreen) -- used the word "natural" in advertisements, yet could not offer a description of "natural" - Nutella branded their jars as a "healthy breakfast" -- Nutella lost the class action suit

*Marketing is the foundation of every business* - Dr. Brady

--> marketing drives stock price and long term growth

5 most socially responsible companies:

Google (1) Disney Lego Natura Nordisk (5)

great marketers:

1. develop products that people want or need 2. price them at a level that maximizes profits (economics) 3. distribute them everywhere consumers are

Takeaways:

1. the primary goal of marketing is to develop good products that consumers want and need - they also have to be priced appropriately and delivered to where consumers are . . . (Product, Price, Place) 2. if firms do marketing correctly, they don't need to advertise much . . . for a while anyway . . . 3. over time, competitors force firms to promote their products in order to differentiate them from close competitors 4. in reality, firms need to perform all 4 P's well in order to drive profits . . . and everything else (Promotion)

Cultural Values

American cultural values - there are a number of enduring American cultural values - current environmental concerns also influence or redefine American values (environmentalism) *EX: directness, individuality, informality, equality, work orientation* *large scale commercial surveys* EX: VALS 2 EX: Yankelovich monitor - known for trend watching - based on 90 minute interviews with 2500 respondents

More About the Power of Branding

Consumer Report Ratings - consumer reports rates all of the products you saw as objectively the same as - or better than - the branded products *EX: Kirkland vodka vs. Grey Goose vodka; Bounty or Kirkland paper towels; Ziploc or Publix Great Value* The Lesson: - brands (and marketing) are powerful

Advertising and Branding

EX: Coca-Cola, Nike, etc. --> the brand drives your loyalty EX: Kirkland aspirin (Costco) vs. Bayer (name-brand) aspirin --> what's the difference? -- answer: nothing -- its a formula; aspirin was developed by Bayer (German) who lost the rights after WWI - so what's the real difference between Coke, Pepsi, and Publix brands? - why do cash-strapped students routinely pay 100% mark-up on soda - how can Bud Light outsell a brand by such a huge margin that's objectively better? *advertising and branding are very powerful* - Coca-Cola spends $4 billion on advertising - Anheuser Busch spends $1.5 billion - consumers don't buy unfamiliar products -- even if the unfamiliar one is objectively better

Regulatory Agencies

Federal Trade Commission (FTC) Food & Drug Administration (FDA) Consumer Product Safety Commission (CPSC) Federal Communications Commission (FCC) Environmental Protection Agency (EPA) Federal Power Commission (FPC) - the FDA banned the sale of antibacterial soap -- no evidence it works better than soap and water -- causes more harm than good --> people were developing an immunity *- the FTC most heavily influences marketing activities* *-- large portion of its resources spent on curbing: * *false advertising* EX: Kellog had to pay $2.5 million for its Rice Krispies claim that it helped children's immune systems (which it didn't) EX: Dannon had to pay $45 million for Activia's "special bacteria" yogurt that was good for your digestive system *misleading pricing*

Milton Friedman

Nobel prize winning economist one of the most influential leaders on consumption analysis, and monetary theory "social responsibility of business is to increase profits"

The Other Side of Marketing

So what about the visible side of marketing? Why is it needed and so prominent? Dr. Brady's answer: 1. time 2. it's powerful 3. it works . . . really well *EX: McDonalds with the McCafe* - learned from Starbucks the markup on coffee;as time went by McDconald's recognized the profit margin potential and coffee was better than anything including hamburgers - companies mimic other successful companies *EX: Apple* came out with the iPhone, then shortly after, Samsung came out with a Galaxy, then Google came out with the Google thumb EX: "It didn't take long for the big beverage makers to take notice [of LaCroix]. Competition in the sparking water market has grown fierce over the past couple years." *EX: Uber*, then Lyft came along, and now there's even more options

Uber Trust Violations

Uber senior VP threatened to spend "millions of dollars" looking into the personal lives of prominent politicians allowed a job applicant to view the ride patterns of prominent politicians tracked "rides of glory" - or rides by users to somewhere other than their homes on Friday and Saturday nights

Relationship Marketing

What does Disney sell? - theme parks, movies/television/radio, cruises, subscriptions/streaming services, live events (Disney on Ice) *relationship marketing*: establishing long term mutually satisfying, buyer seller relationships How do you build a relationship with your customer if you sell toilet paper? *EX: Charmin* - in NYC they created mobile restrooms that they brought to Times Square; they also bring them to concerts and sporting events, etc. -- the result: sales increased 20%

Nestle

a Swiss-based company best known for chocolate and chocola started with milk-based baby food and condensed milk - 2 of the founders were American now its the largest food company in the world - Crunch, Nesquik, Raisinets the largest producer of bottled water in the world - Zephyrhills, etc.

Strategic Business Units (SBUs)

a division of unity within a larger parent company FSU has 15 SBUs ... the COB has 6 (colleges and departments) - arts and sciences - business - communication and information - criminology - education - etc.

Ralph Nader

a well known consumer advocate - the *"father of consumerism"* - fought for consumer safety, environmentalism, and balance of wealth - ran for president in 1996 and 2000 as the green party candidate -- he still puts his name in the race

CSR (Corporate Social Responsibility)

an organization's obligation to maximize its positive impact and minimize its negative impact on society - can generate positive publicity - attracts potential customers - generates indirect long term benefits such as greater employee commitment and improved business performance - promotes goodwill

Economic Responsibility

at the most basic level, all companies have an economic responsibility to be profitable so they can ... - provide a return on investment to their owners and investors - create jobs for the community - contribute goods and services to the economy EX: Dan Price - cofounder and CEO of Gravity Payments - known as the "$70,000 CEO" - in 2015, he dropped his million-dollar salary to $70,000, while also increasing the minimum salary to $70,000 for all of his 130-plus employees

Mars

based in Virginia and owned entirely by the Mars family started by Frank Mars and his son, Forrest, with the invention of the Milky Way, which was intended to taste like a malted shake - Forrest broke off from his father, with Bruce Murrie (Frank's one-time right-hand man), and invented M&Ms -- Mars and Murrie, hence M&M owns 3 of the top 5 pet food brands in the world owns Wrigley's and Uncle Bens once used Hershey chocolate

Environmental Forces

competitive political technological sociocultural legal and regulatory economic

Facebook Trust Violations

conducts over 1000 experiments each day former FB data scientist stated "experiments are run on every user at some point" research from Cambridge shows merely knowing a user's likes can predict gender, race, sexual orientation, political party, and potential drug use

Political Forces

corporate donations top corporate donors: (to political causes) - UPS - AT&T - Pfizer - how do you think UPS views offshore drilling? - how does Pfizer and pro-consumer laws?

*Pepsi*

created by Caleb Bradham to be sold in his drug store in New Barn, NC originally called "Brad's Drink" named after the digestive enzyme "pepsin" Did you know? - Coca-Cola was offered the opportunity to buy Pepsi 3 different times (the latest in 1933) - Coca-Cola declined each time PepsiCo owns Mountain Dew, 7Up, SoBe, Lipton, Aquafina, and Ocean SPray PepsiCo also owns FritoLay, Tropicana, Quaker (oats), and Gatorade

What is Marketing?

definition: "the process of creating, promoting, distributing, and pricing goods, services, and ideas to facilitate satisfying exchange" - this crappy definition is why marketing is so often misunderstood

Sociocultural Forces

demographic/diversity characteristics cultural values consumerism

Pricing

determining product prices EX: "Staples, for example, showed different prices to customers after estimating their locations and working out how close the person was to a competitors brick-and-mortar store"

Consumerism

efforts of independent individuals, groups, and organizations to protect the rights of consumers Ralph Nader is the "father of consumer protection" because of his role in increasing the safety features such as seat belts, air bags, padded dash boards & collapsible steering columns - *today the biggest issue is consumer data policy* the Federal Trade Commission (FTC) provides a wealth of consumer information at its website

Ethical Responsibility

ethical responsibilities are principles and standards defining acceptable conduct this "acceptable conduct" is determined by: - the public - government regulators - private-interest groups - consumers - industry - the organization itself

Legal Responsibility

firms are expected to follow all the laws and regulations designed to keep US companies actions within the range of acceptable conduct and fair competition economic and legal responsibilities are the most basic levels of social responsibility for a good reason - also maintain trust of your customer base

Sustainability

focused on the long-term well-being of the natural environment businesses manage this by: - eliminating the concept of waste - reinventing the concept of a product -- consumables, durable goods, unsalable - make prices reflect the cost - make environmentalism profitable -- encouraging companies to be part of the sustainability initiatives *EX: Elon Musk* the founder and CEO of Tesla Motors and Space X - open-sourced his company's intellectual property - plans to roll out free solar panels and Tesla batteries to 50,000 homes in South Australia in 2022 - currently working on a 700 mph train to run between San Francisco and LA How can firms encourage consumers to behave in a more sustainable manner? - we are a herd-based animal; what we like to do and a lot of our behaviors on how we project image or the people around us EX: "I'm green!" reusable grocery bags -- signaling to everyone else that you care about the environment EX: Tesla, Prius (electric cars) *sustainability meet behavioral economics* *- save money* *- save the planet* *- be a good citizen* *- your neighbors are using less*

"destination products"

have such a strong following that people will go out of their way to get it - they will make a special trip to a place they would not normally be to get the product

Great Marketing & Advertising

if marketers hit their mark with the product, price, and distribution, there's little need to advertise companies that do little, if any, advertising: EX: A6 (shoe company), 4Rivers (John Rivers FSU alum), Krispy Kreme, Netflix EX: Costco, Tesla, Trader Joe's, Lululemon, Rolls Royce, Zara - these are all great companies that don't advertise despite their competitors doing so --> they have the marketing function down pat

Ad Sales vs Editorials

in 2013, the FTC amended the guidelines for social, mobile, and native advertising in 2019, the FTC is getting more aggressive with influencer marketing regulations EX: the FTC recommends using ambiguous disclosures like #thanks, #collab, #sp, #spon, or #ambassador EX: Colehaan; Lord & Taylor

Promotion

inform individuals or groups about the organization and its products/services - advertising - public relations - personal selling - in-store promotions - street teams/guerilla marketing - viral marketing

Pharmaceutical Marketing

is it ethical to: - bring elaborate meals to the doctor's office? - hire doctors to speak about the firm's drugs at medical conferences? - switch on and off various accents and personalities? -- 9/10 pharmaceutical companies spend more on marketing than on research and development

Relationship Marketing Today

mainly in the form of loyalty programs/clubs EX: grocery stores, airlines, and hotels

Distribution/Place

make products available in places and quantities desired minimize costs: - inventory - transportation - storage *EX: Amazon Prime, instacart*

Community Relations

marketers can improve a community's quality of life through: - employment opportunities - economic development - financial contributions to educational, health, cultural, and recreational causes EX: 4Rivers Smokehouse --> John Rivers has done a lot of things for the community

Consumerism

marketing critics think consumers are being exploited in the marketplace - subliminal perception: "mind control" over consumers; marketers are giving consumers information that makes you buy something and we're doing it at a level below your conscious awareness or subliminally EX: Skittles --> "SEX" on package

Marketing Ethics

marketing ethics defines what is acceptable conduct in marketing who determines these standards? - various stakeholders - organization's ethical climate EX: McDonald's is unethical many argue because of the quality of the food and its not food for you EX: many people saying Walmart was being unethical with low wages -- they don't want to talk about the fact that a lot of their prices are lower and people in low income areas can afford these things

Dr. Brady's view of marketing

marketing is the answer to the question of why you buy a product

Origins of Marketing Strategy

mission statement --> corporate strategy --> business-unit strategy --> marketing strategy --> marketing mix elements: product, distribution, promotion, pricing

Segmenting Customers

one soft drink to rule then all? segmentation - happens in all product classes *EX: Coca-Cola* - market was saturated; change the product in a way that attracts a new customer based to increase sales - Coca-Cola came out with Tab (original diet soft drink in a pink can) which was targeted towards women - they later came out with Coke Zero, Coke Light since people in Europe don't like the word "diet", - now there's Coke with lemon and lime, etc. *EX: service organizations* --> Embassy Suites, Canopy, Waldorf & Astoria, Double Tree, Hampton, Homewood Suites, etc. --> all Hilton brands - segmented based on your needs (i.e. one is more for long, extended stay and another hotel is more for like if your flight got cancelled and you don't want to sleep in the airport) *EX: FSU* - MBA programs in College of Business

*Time* what effect does time have on marketing?

over time, the market reacts with competitor products that have similar benefits EX: Chevrolet offered color choices for their cars now the dominant firm has to convince customers its product is superior

Marketing & Stock Price

people on Wall Street and finance people --> they're basically just betting on companies that do marketing correctly - they are gambling on who does the marketing function the best *EX: Apple* does the marketing function really well - when they launch a product that really fits customers unmet wants and needs really well, their stock price goes straight up (positive correlation) -- one-to-one relationship between getting the marketing function right and stock price

Philanthropic Responsibilities

philanthropic activities promote human welfare or goodwill these are often views as the company going above and beyond what is expected 2 forms of philanthropy: - cause-related marketing - strategic philanthropy

Ethical Issues in Pricing

pricing ethical issues: - *price fixing* - *predatory pricing* - *personalized pricing* -- controversial EX: Uber with surge pricing can be seen as unethical EX: concierge medicine --> certain medical practices where you can pay a membership fee and by paying that additional membership fee they can keep their clientele down and then from that you get fast service or premium service

*EX: Starbucks* what makes this a good product? why do so many people buy it?

product benefits: taste, caffeine, instagram inspiration, great service in a great setting, it's everywhere (in airports, in cities, in other countries, etc.) price: the right $ is not always the low $ (from a firm's perspective, the profit margins are massive for coffee), quality/exclusivity, maximizes profit for the firm *product development is a core marketing function* - firms don't get very far without products to sell ... - this warrants repeating; there would be no firms without marketing

*BCG grid/matrix* Boston Consulting Group

product market growth - HIGH relative market share - HIGH = *STAR* product market growth - HIGH relative market share - LOW = *QUESTION MARK* product market growth - LOW relative market share - HIGH = *CASH COW* product market growth - LOW relative market share - LOW = *DOG*

Legal and Regulatory Forces

regulatory agencies (FTC) insurance companies have fought for longer hunting seasons - laws in the US also impact businesses -- the longer hunting season, the fewer deer, moose, or whatever else that would run into cars and the less they have to pay to fix those cars that run into deer and moose

SWOT Analysis

strengths, weaknesses, opportunities, threats convert weaknesses to strengths, convert threats to opportunities, match strengths to opportunities *EX: weakness to strength* - Amazon partnered with UPS to turn a weakness (delivery) into a strength -- Amazon accounts for 10% of UPS's business - does not do business with FedEx -- however, Amazon now delivers 45% of its own packages ==> weakness --> strength --> self strength

Economic Forces

the *business cycle*: prosperity --> recession --> depression --> recovery EX: unemployment rate (2008-2018)

Relationship Marketing Era (1990s-2010)

the focus is on long-term relationships and customer retention - a 5% increase in customer retention yields up to a 95% improvement in NPV delivered by customers - repeat customers generate over twice as much revenue as new customers - engaged customers generate 1.7 times more revenue than normal customers

cause-related marketing

the practice of linking products to a particular social cause an ongoing or short-term basis EX: Wendy's - one-time promotional campaign

strategic philanthropy

the use of core competencies and resources to address key stakeholders' interests and achieve both organizational and social benefits - a part of the firm itself EX: Toms --> BOGO model EX: Home Depot --> "buy a home, build our community"

*core competencies*

things a firm does well - competitive advantage --> opportunity + competency EX: Ebay *EX: Starbucks* - they gave people a second place at a time when they needed a second place and they gave people access to coffee drinks that they didn't have at the time; so they aligned their core competency which is providing the place and great customer service with the strategic window of opportunity right and they became a rousing success EX: what is McDonald's core competency? --> you're buying consistency and convenience

*Warren Buffet*

third wealthiest person in the world (worth $82 billion) pays himself $175,000 a year and still lives in the same house he bought in 1958 - worth $700,000 still uses a flip phone and eats breakfast at McDonald's every morning based in Omaha, NE "it takes 20 years to build a reputation, and 5 minutes to ruin it" *owns the company Berkshire Hathaway* - a conglomerate holding company with a diverse portfolio of business - best known for insurance - started out as a textile company in Massachusetts that Buffet took over -- hence the Berkshire name

*Business-Unit Strategy*

to provide high quality, innovative instruction that prepares, challenges, and inspires the students to shape the future of business - 30% rule to be an international though leader by producing high quality scholarly research and publishing in top tier journals - JM, JMR, JCR, MS -- JAMS, JSR, JCP

Misconceptions of Marketing

what most people think of marketing: Promotion (advertisements) - really just the tip of the iceberg what marketing actually is: complex, strategic, quantitative, multifaceted, and much more - "omnipresence of advertising" (holistic view) the problem originates with "quasi-marketers" marketing must invent complete products and drive them to commanding positions in defensible market segments

Value

what you get / what you give up = value --> costs vs. benefits Examples: Wendy's 4 for $4, Publix BOGOs, Winn Dixie loyalty program, Great Value brand at Costco

*market opportunity*

where circumstance and timing meet to create strategic windows