Marketing Management

Area Market potential

an estimate of the market potential for a particular area. Can be predicted using one of the following two methods Market buildup method - used primarily by business marketers. Calls for identifying all the potential buyers in each method and estimating their potential purchases. Multiple factor index method - used primarily by consumer marketers.

Points of parity (POP's)

attribute or benefit associations that are not necessarily unique to the brand but may in fact be shared with other brands

Marketing Information System (MIS)

consists of people, equipment, and procedures to gather, sort, analyze, evaluate, and distribute needed, timely, and accurate information to marketing decision makers. It relies on internal company records, marketing intelligence activities, and marketing research.

Organizational buying

decision making process which formal organizations establish the need for purchased products and services

6 major forces in the environment that firms must monitor

demographic economic sociocultural natural technological political-legal

The Measures of Market Demand

Potential market - set of consumers with a sufficient level of interest in a market offer. Available Market - set of consumers who have interest, income, and access to a particular offer Target market - the part of the qualified available market the company decides to pursue Penetrated market - the set of consumers who are buying the company's product.

Proactive Marketing

a Responsive marketer finds a stated need and fills it a Anticipative marketer looks ahead to needs customers may have in the near future a Creative marketer discovers solutions customers did not ask for but to which they enthusiastically respond

fad

a craze that is unpredictable, of brief duration, and without long-term significance.

Loyalty

a deeply held commitment to re-buy or re-patronize a preferred product or service in the future despite situation influences and marketing efforts having the potential to cause switching behavior.

trend

a direction or sequence of events with momentum and durability, revealing the shape of the future

Profitable Customer

a person, household, or company that over time yields a revenue stream exceeding by an acceptable amount the company's cost stream for attracting, selling, and serving that customer.

Market potential

limit approached by market demand as industry marketing expenditures approach infinity for a given marketing environment.

Opportunism

some form of cheating or undersupply relative to an implicit or explicit contract

Brand Community

specialized community of consumers and employees whose identification and activities focus around brand

Company sales forecast

the expected level of company sales based on a chosen marketing plan and an assumed marketing environment.

Total Customer Cost

the perceived bundle of cost customers expect to incur in evaluating, obtaining, using, and disposing of the given market offering, including monetary, time, energy, and psychological costs.

Customer Relationship Management (CRM)

the process of carefully managing detailed information about individual customers and all customer "touch points" to maximize loyalty.

Sales quota

sales goal set for a product line, company division, or sales representative.

Bases for Segmenting Consumer Markets: -Market Segment 2 broad variables -descriptive Characteristics -Behavioral Characteristics Major Segmentation Variables: 1. Geographic -Grassroots Marketing -PRIZMS 2. Demographic -Life Stage -Generation -Culture 3.Psychographic -Psychographics -VALS 4. Behavioral Segmentation -Needs and Benefits -Decision Roles -User and User related variables +Occasion +User Status +Usage rate +Buyer readiness stage -Marketing Funnel +Attitude + Loyalty Status

*Market Segment*- consists of a *group of customers* who *share* a *similar set* of *needs* and *wants.* +*2 Broad Variables to segment consumer markets:* 1.*Descriptive Characteristics*- Geographic, Demographic, and psychographic-- and asking whether these segments exhibit different needs or product responses. 2.*Behavioral Characteristics*- Consumer responses to *benefits, usage occasions,* or *brands,* then seeing whether *different characteristics* are *associated* with each *consumer response segment.* +*Major Segmentation Variables:* 1. *Geographic Segmentation*- divides the market into *geographical units* such as *nations, states, regions, counties, cities* or *neighborhoods.* -*Grassroots Marketing*- marketer concentrate on making *tailored made marketing activities* as *personally relevant* to *individual customers* as possible. -*PRIZMS*- Geoclustering tool to describe segments by zip code. 2.*Demographic Segmentation*- variables including: *age, family size, family life cycle, gender, income, occupation, education, religion, race, generation, nationality,* and *social class.* +Often *associated with consumer needs* + *Easy to measure* +types of Demographic Segments: -*Life Stage*- Going through a *divorce, second marriage,* taking *care of older parents, buying a home.* -*Generation*- separated into *cohorts* +*Millennials*- 1977-1994 +*Generation x*- 1964-1978 +*Baby Boomers*- 1946-1964 +*Silent generation*- 192five-194five -*Race and Culture*- *Multicultural marketing*- an approach *recognizing* that *different ethnic* and *cultural segments* have sufficiently *different needs* to require *targeted marketing activities* and that a *mass market approach* is *not refined* enough for *diversity* of the *marketplace.* 3.*Psychographic segmentation:*- Buyers are divided into groups on the basis of psychological *personality traits, lifestyle, or values.* -*Psychographics*- is the science of using *psychology* and *demographics* to better *understand consumers.* -*VALS Framework*- main dimensions include *consumer motivation* <horizontal> and *consumer resources* <vertical dimension> Consumers are *inspired* by *1* of *3 primary motivations: Ideals, Achievement,* and *self-Expression.* Different *levels* of *resources enhance* or *constrain* a *person's expression* of his or her *primary motivation.* 4.*Behavioral Segmentation*- Marketers divide buyers into groups on the basis of their *knowledge of, attitude toward, use of, or response to a product.* -*Needs and Benefits*- -*Decision Roles*- composed of *FIVE Roles* in a *buying decision.* 1. *Initiator* 2. *Influencer* 3. *Decider* 4. *Buyer* FIVE. *User* -*User and Usage-Related Variable*- 1.*Occasions*- mark a *time* of day, week month, year. EX: *Air travel* triggered by *occasions related to business, vacation, or family.* 2. *User Status*- every product has *ex-users, potential users, first-time users, and regular users.* 3. *Usage Rate*- Segmenting market into *light, medium, and heavy product users.* 4. *Buyer Readiness Stage*- if a person is *aware, unaware, or informed* about a *product.* -*Marketing Funnel*- can be used to break the market into *buyer readiness stages.* Five. *Loyalty Status* 6. *Attitude*- if a consumer is either *enthusiastic, indifferent, negative,* and *hostile*

Chapter 6 Identifying Market Segments and targets:

Finally

Bases for Segmenting Business Markets:

1*Demographics*- *Most Important +Industry + Company size + Location 2.*Operating Variables* +technology +User or nonuser status +Customer capabilities 3.*Purchasing Approaches 4. *Situataional

Decision Heuristics

1. Availability heuristic - quickness and ease with which a particular example of an outcome comes to mind 2. Representativeness heuristic - how representative or similar the outcome is to other examples 3. Anchoring and adjustment heuristic - consumers arrive at an initial judgement and then adjust it based on additional information

Buying center

1. Initiators - request that something be purchased 2. Users - those who use the product or service 3. Influencers - people who influence buying decision 4. Deciders - people who decide on product requirements or on suppliers 5. Approvers - people who authorize the proposed actions of buyers or deciders 6. Buyers - formal authority to select supplier and arrange the purchase terms 7. Gatekeepers - have the power to prevent sellers or information from reaching members of buying center

Stages in Business buying process

1. Problem recognition 2. General need description and product specification - product value analysis is approach to cost reduction 3. Supplier search - vertical hubs (plastics, steel, chemicals, paper) functional hubs (logistics, media buying, advertising) 4. Proposal solicitation - invites qualified suppliers to submit written proposals 5. Supplier selection - specify and rand desired supplier attributes 6. Order-routine specification - buyer negotiates final order, listing the technical specifications, quantity needed, delivery time, etc. 7. Performance review - buyer periodically reviews performance of chosen suppliers

Chapter 5: Analyzing Consumer and Business Markets

Get errrrrrr donnnnnnnnne

Customer Churn

AKA defection. when you can't hold onto your customers

Value proposition

Cogent reason why the target market should buy a product or service

Cultural Branding

Ex: American Girl Dolls tap into mother-daughter relationships and cross-generational transfer of femininity

Chapter 4: Creating Long-Term Loyalty Relationships

Get 'er duuuuuunn

"House of Brands" strategy

The use of individual or separate family brand names where the use of an umbrella corporate or company brand name has be referred to as a "branded house" strategy

Measuring Brand Equity

Indirect Approach: assesses potential sources of brand equity by identifying and tracking consumer brand knowledge structures Direct Approach: assesses the actual impact of brand knowledge on consumer response to different aspects of the marketing Marketers need to fully understand 1. the sources of brand equity and how they affect outcomes of interest and 2. how these sources and outcomes change, if at all, over time. Brand Audits are important for the former, Band Tracking for the latter

Institutional and Government Markets

Institutional market - Schools, hospitals, institutions that provide goods and services to people in their care Government Organizations - major buyers of goods and services

Family

Most important consumer buying org. Family of orientation - parents and siblings Family of procreation - persons spouse and children

Branding

Process of endowing products and services with the power of a brand

Social Factors

Reference groups - all groups that have a direct (face to face) or indirect influence on his or her attitudes or behavior. Groups having direct influence are called membership groups. Primary groups - family, neighbors, coworkers Secondary groups - religious groups, professional, trade-union groups Aspirational Groups - Those person hopes to join Dissociative groups - those whose values or behavior an individual rejects Opinion leader - Person who offers informal advice or information about a specific product or category.

Roles and status

Role - activities a person is expected to perform Status - Each role creates a status Vice president may have more status than a sales manager, and a sales manager may have more status than an office clerk

Chapter 7

Screw this test

Brand Portfolio

Set of all brand and brand lines a particular firm offers for sale in a particular category or market segment Marketers carefully monitor brand portfolios over time to identify weak brands and kill unprofitable ones

Emotional Branding

Should contain points of difference and points of parity that appeal to both the head and the heart. A persons emotional response to a brand and its marketing will depend on many factors Brands such as Hershey's, Kraft, Crayola are seen as authentic and genuine can evoke trust

Cliques

Small groups whose members interact frequently Members are very similar and close

The Marketing Research Process

Step 1: Define the problem, decision alternatives, and research objectives Step 2: Develop the Research Plan Data sources: The researcher can gather secondary data, primary data, or both. Research Approaches: Observational Research - EX: Observing customers as they shop to see their shopping patterns Focus group research - gathering of 6-10 individuals for a discussion with a moderator Survey research - using a survey Behavioral research - reviewing customers purchasing patterns Experimental research - The most scientifically valid research. captures a cause and effect relationship by eliminating competing explanations of the findings. Basically, if everything stays the same does the one thing that changed effect purchasing decisions. Research Instruments: questionnaires qualitative measures technological devices Sampling plan: Sampling unit sample size sampling procedure Contact method: in person mail phone online Step 3: Collect the data Step 4: analyze the information Step 5: present the findings Step 6: make the decision

Business Buying situations

Straight rebuy - reorder items like office supplies and bulk chemicals on routine basis Modified rebuy - change product specification, prices, delivery requirements, and other terms New Task - buys a product or service for the first time

Consumer Behavior

Study of how individuals, groups, and org. select, buy, use, and dispose of goods, services, ideas, or experiences to satisfy their needs and wants Buying behavior is influenced by cultural social, and personal factors

Marketing research

The function that links the consumer, customer, and public to the marketer through information - information used to identify and define marketing opportunities and problems; generate, refine, and evaluate marketing actions; monitor marketing performance; and improve understanding of marketing as a process.

Category Membership

The products or sets of products with which a brand competes and that function as close substitutes

Customer Equity

The sum of lifetime values of all customers Goal is to produce high customer equity

Brand Elements

Trademarkable devices that identify and differentiate the brand. Ex: Nike has "swoosh" logo, "Just Do It" slogan

Competitive frame of reference

Which other brands a brand competes with and which should thus be the focus of competitive analysis

subcultures

groups with shared values, beliefs, preferences, and behaviors emerging from their special life experiences or circumstances.

Framing

how choices are presented to and seen by a decision maker $200 cell phone may not seem that expensive in context of a set of $400 phones, but may seem expensive in context of a $50 phones

Marketing Funnel

identifies the percentage of the potential target market at each stage in the decision process, from merely aware to highly loyal.

industry sales and market shares

identifying competitors and estimating their sales

Satisfaction

persons feelings of pleasure of disappointment that result from comparing a product or service's perceived performance to expectation

forecasting

the art of anticipating what buyers are likely to do under a given set of conditions

Company demand

the company's estimated share of market demand at alternative levels of company marketing effort in a given time period.

Quality

the totality of features and characteristics of a product or service that bear on its ability to satisfy stated or implied needs

Market demand

total volume that would be bought by a defined customer group in a defined geographical area in a defined time period in a defined marketing environment under a defined marketing program. It is not a fixed number but rather a function of the stated conditions.

Criteria for choosing brand elements

For building the brand: Memorable, Meaningful, Likable For defending the brand: Transferable (does it add to brand equity), Adaptable, Protectable

Brand Valuation

Job of estimating the total financial value of the brand. Ex: Top brand-management firm Interbrand has developed a 5 step model to estimate the dollar value of a brand and help firms maximize return on brand investment.

Company Orientation toward the Market Place Holistic Marketing Concept 4 components of Holistic Marketing: 1.Relationship Marketing 4 Constituents: +Customers +Employees + Marketing Partners + Financial Community -Marketing Network 2. Integrated Marketing 2 Parts 3. Internal Marketing 4. Performance Marketing

*Holistic Marketing Concept*- Based on the *development, Design* and *implementation* of *marketing programs, processes* and *activities* that recognize their *breadth* and *interdependencies.* 4 broad components of Holistic Marketing: 1.*Relationship Marketing*- Aims to *build mutually satisfying long-term relationships* with key constituents in order to *earn* and *retain their business.* 4 Key constituents of Relationship Marketing: 1. *Customers* 2. *Employees* 3. *Marketing Partners* <Channels, suppliers, distributors, dealers, agencies> 4. Members of the *Financial Community* <Shareholders, Investors analyst.> =*Marketing Network*- *Unique Asset* and ultimate *outcome* of *relationship marketing* +Operating Principle: *Build* an *effective network* of *relationships* with key *stakeholders,* and *profits will follow.* ----> *Relationship Marketing* also is shaping *separate offers, services,* and *messages* to *Individual Customers,* based on *information* about their *past transactions, demographics, psychographics* and *media* and *distribution preferences.*<-------- -----> By *focusing* on their *most profitable customers, products*, and *channels,* these firms hope to achieve *profitable growth,* capturing a *larger share* of *each customer's expenditures* by building high *customer loyalty.*<------ 2. *Integrated Marketing*- Occurs when the *marketer* devises *activities* and *Programs* to *create, communicate,* and *deliver value* for consumers such that "*the whole is greater than the sum of its parts.*" +Many *different marketing activities* can *create, communicate,* and *deliver value.* + Marketers should *design* and *implement each marketing activity with all other activities in mind.* ---->All *company communications* must be integrated so they *reinforce* and *complement each other.*<----- 3. *Internal Marketing*- is the *task* of *hiring, training,* and *motivating* able *employees* who *want* to *serve customers well.* EX: *Restaurant telling* their *employees* to *sell* a *certain product* based off a particular item being *in season* and they're getting a *high margin.* 4. *Performance Marketing*- Requires *understanding* the *financial* and *non-financial returns* to *business* and *society* from *marketing activities* and *Programs.* +Marketers are *considering* more than just *sales revenue* to *interpret* what is happening to *market share, customer loss rate, customer satisfaction, product quality, etc...* they are also considering the *legal, ethical, social* and *environmental effects* of *marketing activities* and *programs*.

What is a Market? -Market 4 Customer Groups FIG 1.1 Four Flows connecting a Seller and a Buyer

*Market*- is a term used by marketers to describe *customer groups.* +Four Key Customer Markets: - Consumer - Business - Global - Nonprofit FIG 1.1: shows how *sellers* and *buyers* are connected by *four flows.* -*Seller* sends *goods* and *services* and *communications* such as *ads* and *direct mail* to the *market.* - In return *sellers receive*, *Money* and *Information* such as *customer attitudes* and *sales data.* -the *inner loop* shows and exchange of *money for goods* and *services.* - the *outer loop* shows and exchange of *information.*

Competition -Rival Offerings -Substitute products

*Competition*- Includes all the *actual* and *potential rival offerings* and *substitutes* a buyer might consider. EX: *Rival offerings*- An *Automobile manufacturer* can buy *steel* for U.S. Steel, from a firm in Japan or Korea, or from a mini-mill. EX: *Substitute*- It can also buy *aluminum* parts from Alcoa to reduce the car's weight or engineered plastics instead of steal.* ---->Clearly the U.S. Steel is more likely to be *hurt* by *substitute products* than by other *integrated steel companies* and would be *defining* its *competition* too *Narrowly* if it *didn't recognize this.*<-----

Advantages of Brand Extensions

1. Can facilitate new product acceptance 2. Provide positive feedback to the parent brand and company

What is Marketed? +ten Items

1. *Goods*- *physical goods* constitute the *bulk* of most countries' production and marketing efforts. -Each year, U.S. companies market billions of fresh, canned, bagged, and frozen *food products* and other *tangible items.* 2. *Services*- As *economies advance*, a growing proportion of their activities focuses on the production of services. -EX: Airlines, hotels, car rental firms, barbers, and beauticians, maintenance and repair people, and accountants, etc... 3. *Events*- Marketers promote *time-based events* such as *major trade shows, artistic performances,* and *company anniversaries.* -EX: Global sporting events such as the *Olympics* and the *World Cup* are promoted aggressively to companies and fans. 4. *Experiences*- By *orchestrating several services* and *goods*, a firm can create, stage, and market experiences. -EX: *Walt Disney World's Magic Kingdom* lets customers visit a fairy kingdom, a pirate ship, or a haunted house. -EX: Customized experiences include a week at a *baseball camp* with retired baseball greats, as one example. FIVE. *Persons*- *Artist, Musicians, CEO's, physicians,* high-profile *financiers* often get help from marketers. -EX: Management Consultant tom Peters, himself a master at *self-branding*, has advised each person to become a "brand." 6. *Persons*- *Cities, states, regions,* and whole *nations* compete to *attract* tourist, residents, factories, and company headquarters. -EX: Place marketers include *economic development specialists, real estate agents, commercial banks*, local business associations, and advertising and *public relations* agencies. 7. *Properties*- Properties are *intangible rights of ownership* to either *real property*<real estate> or *financial property*<stocks and bonds>. -they can be bought and sold and therefor require marketing through the efforts of *real estate agents, investment companies,* and *banks.* 8. *Organizations*- *Museums, performing arts organizations, corporations,* and *nonprofits* all use marketing to boost their public images and compete for audiences and funds. -EX: Some *universities* have created *Chief Marketing Officer*<CMO> positions to better manage their *school identity* and *image,* via everything from admission brochures and twitter feeds to brand strategy. 9. *Information*- Information is essentially what *books, schools*, and *Universities* produce, market, and distribute at a *price* to *parents, students*, and *communities.* ten. *Ideas*- Every market offering includes a basic idea. *Products and Services* are platforms for delivering some *idea or benefit* EX: Charles Revson of *Revlon* once observed: "In the factory we make cosmetics;in the drugstore we sell hope." EX: *Social Marketers* promote such ideas as "Friends Don't Let Friends Drive Drunk" and "A Mind Is a terrible thing to Waste."

Chapter 1: Defining Marketing for the New Realities

Get her done!

Points of difference (POD's)

Attributes or benefits that consumers strongly associate with a brand, positively evaluate, and believe they could not find to the same extent with a competitive brand

Brand Audits

A focused series of procedures to assess the health of the brand, uncover its sources of brand equity and suggest ways to improve and leverage its equity. Allows marketers to manage brands more proactively and responsively

Industry

Group of firms offering a product or class of products that are close substitutes for one another

Role of Brands

Ability to simplify decision making and reduce risk becomes invaluable Brands can also take on personal meaning to consumers and become an important part of their identity. Sometimes can take on human-like characteristics

Brand Equity

Added value endowed to products and services with consumers Ex: reflected in the way consumers think, feel, and act with respect to the brand as well as in the prices, market share, and profitability

Customer lifetime value

Affected by revenue and by the costs of customer acquisition, retention, and cross-selling

Brand Revitalization

After hard times in the automotive market, Cadillac, Fiat, and Volkswagen have all turned their brand fortunes around to varying degrees. First step: understand what the sources of brand equity were to begin with (positive or negative). Then decide whether to retain same positioning or create a new one and, if so, which new one Brand revitalization of almost any kind starts with the product

Corporate and Division Strategic Planning: Corporate headquarters 4 planning activities: 1. Defining the Corporate Mission -Mission Statement 2. Establishing Strategic Business Units -3 characteristics of a SBU 3. Assigning Resources to Each SBU -Assessing Growth Opportunities +Intensive Opportunities 1.Market penetration 2. Market development 3. Product- Development 4. Diversification + Integrative Opportunities 1. Backward/Forward Integration 2. Horizontal Integration + Diversification Opportunities 4. Organization and Organizational Culture -Corporate Culture - Scenario Analysis

All *corporate headquarters* undertake *4 planning activities:* 1.*Defining the Corporate Mission*- to *define its mission* a company should address these questions: *What is our business? Who is the Customer? What is of Value to the customer? What will our business be? What should our business be?* -*Mission Statement*- developed *collaboratively* with and *shared* with *managers, employees,* and often *customers,* provide a shared sense of *purpose, direction,* and *opportunity.* 2. *Establishing Strategic Business Units:* -*Strategic Business Unit <SBU>*- has *3 Characteristics:* 1. It is a *single business,* or a *collection of related businesses,* that can be *planned separately* from the rest of the company. 2. It has its *own set of competitors.* 3. It has a *manager responsible* for *strategic planning* and *profit Performance* who *controls* most *factors affecting profit.* ------> the *purpose* for *defining* the company's *strategic business units* is to *develop separate strategies* and *assign appropriate funding.*<------- 3. *Assigning Resources to Each SBU:* +Newer method of *portfolio planning* rely on *shareholder value analysis* and on whether the *market value* of a company is *greater with* and *SBU* or *without it.* these *value calculations* assess the potential of a business based on 1.*Growth Opportunities* from global expansion, *repositioning* or *retargeting,* and *strategic outsourcing.* 1.*Assessing Growth Opportunities:* includes planning new businesses, downsizing, and terminating older businesses. A. *Intensive Opportunities*- Opportunities for growth *within current business.* -Marketers can use a "*Product-Market expansion Grid*" to consider a firms strategic growth opportunities in terms of *current* and *new products* and *markets.* 1.*Market-Penetration Strategy*- Gaining *market share* with *Current Products* in *Current Markets.* 2.*Market-Development Strategy*- Find or develop *new markets* for its *current products.* 3.*Product-Development Strategy*- Develop *new products* for its *current markets.* 4.*Diversification Strategy*- Develop *New products* for *new Markets.* B. *Integrative Opportunities*- to build or *acquire businesses related* to *current business.* 1. *Backward Integration*- *acquiring suppliers* 2. *Forward Integration*- *Acquiring Distributors* 3. *Horizontal Integration*- Acquiring a *competitor* C. *Diversification Opportunities*- *Add* attractive *unrelated businesses.* + Makes sense when *good opportunities exist outside* the *present business*- the *industry* is *highly attractive* and the *company* has the *right mix* of *business strengths to succeed.* 4. *Organization And Organization Culture:* -*Corporate Culture*- the *shared experiences, stories, beliefs,* and *norms* that *characterize and organization.* -*Scenario Analysis*- develops *plausible representations* of a Firm's possible *future* using assumptions about *forces driving* the *market* and *different uncertainties.*

Brand Contact

Any information-bearing experience, whether positive or negative, a customer or prospect has with the brand, its product category, or its market. Brand Contact can affect consumers brand knowledge and way they think, feel, or act toward the brand

3 types of Points of parity

Category points of parity - Attributes or benefits that consumers view as essential to a legitimate and credible offering within a certain category. These change over time Correlational points of parity - potentially negative associations that arise from the existence of positive associations for the brand Competitive points of parity - associations designed to overcome perceived weaknesses of the brand in light of competitors points of difference

Internal Branding

Consist of activities and processes that help inform and inspire employees about brands Marketers must adopt an internal perspective to be sure employees and marketing partners appreciate and understand basic branding notions and how they can help or hurt brand equity

Increasing Market Share

Cost of buying higher market share through acquisition may far exceed its revenue value, a company should consider four factors first: 1. Possibility of provoking antitrust action (monopoly) 2. Economic Cost - cost of gaining further market share might exceed the value if holdout customers dislike the firm 3. Pursuing the wrong marketing activities 4. Effect of increased market share on actual and perceived quality

Customer-based brand equity

Differential effect brand knowledge has on consumer response to the marketing of that brand Positive customer-based brand equity when consumers react more favorably react more favorably to a product and the way it is marketed when the brand is identified than when it is not identified

Brand Promise

Marketers vision of what the brand must be and do for consumers

Disadvantages of Brand Extensions

May cause the brand name to be less strongly identified with any one product Firm forgoes the chance to create a new brand with its own unique image and equity Worse scenario is for an extension not only to fail, but to harm the parent brand in the process

Valuable functions brands perform

Simplify product handling by helping organization inventory and accounting records Allows the firm legal protection for unique product features Brand name can be protected through registered trademarks, manufacturing processes can be protected through patents, and packaging can be protected through copyrights and proprietary designs Brand Loyalty provides predictability and security of demand for the firm Branding can be a powerful means to secure competitive advantage

Internal Records and Database Systems

The Order-To-Payment Cycle - order is placed, sales dept prepares invoices, transmits copies to carious departments, and back-orders out of stock items. shipped items generate shipping and billing documents. Sales Information Systems - Mkting Mgrs need timely and accurate reports on current sales. Customer Database - is an organized collection of comprehensive information about individual customers or prospects that is current, accessible and actionable for lead generation, lead qualification, sales, or customer relationship management Database Marketing - The process of building, maintaining, and using customer databases and other databases to contact, transact with, and build relationships with customers. Data warehouse - Where marketers can capture, query, and analyze data to draw inferences about individual customers' needs and responses. Data Mining - used to extract from the mass of data useful insights about customer behavior, trends, and segments.

Positioning

The act of designing a company's offering and image to occupy a distinctive place in the minds of the target market Goal s to locate the brand in the minds of consumers to maximize the potential benefit to the firm

Brand-tracking studies

Use the brand audit as input to collect quantitative data from consumers over time, providing consistent, baseline information about how brands and marketing programs are performing. Helps understand where, how much, and in what ways brand value is being created to facilitate dat-to-day decision making

Marketing intelligence systems

a set of procedures and sources that managers use to obtain everyday information about developments in the marketing environment.

Value and Satisfaction Value: -tangible/intangible benefits -tangible/Intangible Costs Customer Value triad Satisfaction +scenarios of performance

the buyer chooses the offerings he or she *perceives* to deliver the *most value* -*Value*- the sum of the *tangible* and *Intangible benefits* and *Costs.* + *tangible Benefit*- Fill car with gas, now can *drive.* + *Intangible Benefit*- Fill car with gas, now I can go have *fun.* + *tangible Cost*- Fill car = *Money* + *Intangible Cost*- Fill car with gas= takes *time.* -*Customer Value triad*- A central marketing concept, is primarily a *combination* of *quality, service,* and *price.* ---->*Value Perception increases* with *quality* and *service* but *decreases* with *price.*<----- -*Satisfaction*- reflects a person's *judgement* of a *product's perceived performance* in relationship to *expectations.* +If *performance falls short* of *expectations,* the *customer* is *disappointed.* + If it *matches expectations,* the *customer* is *satisfied.* + If it *exceeds them,* the *customer* is *delighted.*

Behavioral targeting

to track customers' online behavior for marketing purposes allows advertisers to better target online ads.

Company Orientation toward the Market Place: Selling Concept -Hard Selling

*Selling Concept*- Holds that *consumers* and *businesses,* if *left alone, won't buy enough* of the *organizations products.* +Practiced most *aggressively* with *unsought good*-- Goods *buyers don't normally think of buying,* such as *insurance* and *cemetery plots* +Marketing based on *hard selling* is *risky.* it assumes *customers coaxed* into *buying a product* not only *won't return* or *Bad-Mouth it* or *complain* but might even *buy it again.*

3 transformative forces effecting Marketing 3. Social Responsibility +Private sector + Marketing effects Society

*Poverty, pollution, water shortages, climate change, wars*, and *wealth concentration* demand our attention. +the *Private Sector* is taking some *responsibility* for *improving living conditions,* and *firms* all over the world have *elevated* the *role* of *corporate social responsibility.* +Because marketing *effects* the *society* as a *whole,* Marketers must *consider* the *ethical, environmental, legal* and *social context* of their *activities.*

Company Orientation toward the Market Place: the Product Concept

*Product Concept*- proposes that *consumers favor products* offering the *most quality, performance* or *innovative features.* +*Managers* might commit "*Better-Moustrap*" fallacy, believing a *better product* will by itself lead *customers* to *their door.* ----->Many *start-ups* have learned the hard way, a *new product* will *not* necessarily be *successful* unless it's *priced, distributed, advertised* and *sold properly.*<-----

Company Orientation toward the Market Place: the Production Concept

*Production Concept*- is one of the *oldest concepts* in business. It hold that *consumers prefer products* that are *widely available* and *inexpensive.* +*Managers* of *production-oriented* businesses *concentrate* on achieving *high production efficiency, low costs,* and *mass distribution.* EX: *Lenovo,* has taken advantage of *China's* huge *inexpensive labor pool* to dominate the market.

target Markets, Positioning, and segmentation types of Market Segments -Demographic -Psychographic -Behavioral Positioning

*Segments*- Marketers therefore *Identify* distinct segments of *buyers* by identifying: -*Demographic*- Age, Sex, and Income -*Psychographic*- personality, values, opinions, attitudes, interests, and lifestyles - *Behavioral*- based on their knowledge, attitudes, uses and responses to the product *Differences* between them. +they then decide *which segments* present the *greatest opportunities.* +For each of these *target markets*, the firm develops a *market offering* that it *Positions* in the target *buyers' minds* as delivering some *key benefits* EX: *Proche* targets buyers who seek *pleasure* and *excitement* in driving and want to make a *statement* about their *wheels.*

5 attack strategies for challengers

1. Frontal attack - matches its opponents product, price, distribution 2. Flank attack - identifies shifts that cause gaps to develop in the market, then rushing to fill the gaps 3. Encirclement attack - capture a wide slice of territory by launching a grand offensive on several fronts 4. Bypass attack - three lines of approach: diversifying into unrelated products, new geographical markets, and leapfrogging into new technologies 5. Guerrilla attack - Price cuts, promotional blitzes, legal action

Brand Equity Drivers

1. Initial choices for the brand elements or identities making up the brand (brand names, URLs, logos, symbols, characters, spokespeople, etc.) Ex: Microsoft chose the name Bing for its new search engine because it felt it unambiguously conveyed search and the "aha" moment of finding what you are looking for. It is also short, appealing, memorable, active, and effective multiculturally. 2. Product and service and all accompanying marketing activities and supporting programs - General Mills is employing a number of new marketing activities to sell cereals, cake mixes, and yogurt 3. Other associations indirectly transferred to the brand by linking it to some other entity (person, place, thing) - Brand name of New Zealand vodka 42BELOW refers to both a latitude that runs through New Zealand and the percentage of the drinks alcohol content.

3 Strategies for growing the core

1. Make the core of the brand as distinctive as possible 2. Drive distribution through both existing and new channels 3. Offer the core product in new formats or versions

Brand Strategy

Often called brand architecture Reflects the number and nature of both common and distinctive brand elements 3 choices how to brand new products: 1. develop new brand elements for the new product, 2. apply some existing brand elements, or 3. us a combination of new and existing brand elements

Customer Lifetime Value (CLV)

describes the net present value of the stream of future profits expected over the customer's lifetime purchases.

Total market potential

the maximum sales available to all firms in an industry during a given period under a given level of industry marketing effort and environmental conditions.

Chapter 2: Developing and Implementing Marketing Strategies and Plans

wha wha

Core Competencies

*Core Competency 3 Characteristics:* 1. Is is a source of *competitive advantage* and makes a *significant contribution* to perceived *customer benefits.* 2. It has *applications* in a *wide variety* of *markets.* 3. It is *difficult* for *competitors to imitate.* -*Distinctive Capabilities*- excellence in broader *business processes.*

Business Unit Strategic Planning: Business Mission Statement SWOt analysis Goal Formulation -Goals -Manage by Objective<4> Strategy Formulation: -Strategy -Generic Strategies: 1.Cost leadership 2.Differentiation 3.Focus +Strategic Group +Partner Relationship Management <PRM> Strategy and Implementation -Strategy -Implementation 7 Elements of Successful business Practices 1,2,3, =Hardware 4, Five, 6, 7= Software

*External Environment <Opportunity and threat> Analysis:* -*Environmental threat*- is a challenge posed by an *unfavorable trend* or *development* that, in the absence of *defensive marketing action,* would lead to *lower sales or Profit* *Internal Environment <Strengths and Weaknesses> Analysis*: 3. *Goal Formulation*- Developing *specific goals* for the *planning period.* -*Goals*- Objectives that are specific with respect to *magnitude and time* EX: Profitability, Sales growth, market share, innovation -*Manage By Objective*- After business unit *sets objectives.* they need to be 1. Arranged *hierarchically* 2. *Quantitative* 3. *Realistic* 4. *Consistent.* 4. *Strategy Formulation:* -*Strategy*- is a *game plan* for reaching *goals.* *3 Generic Strategies:* 1. *Overall Cost Leadership*- Firms work to achieve the *lowest production* and *distribution costs.* so they can *underprice competitors* and *win market share.* 2.*Differentiation*- the business concentrates on achieving *superior performance* in an important *customer benefit area* valued by a *large part* of the *market*. 3.*Focus*- the business focuses on *one* or *more* narrow *market segments* gets to *know them* intimately, and pursues either *cost leadership* or *differentiation* within the *target segment.* -*Strategic Group*- *competing firms* directing the *same strategy* to the *same target market.* -*Partner Relationship Management <PRM>*- Firms using *organizational structures* in order to *sustain strategic alliances* with other companies. FIVE. *Strategy and Implementation*: +*strategy* addresses the *what* and *why* of *marketing programs* and *activities.* +*Implementation*- addresses the *who, where, when,* and *how.* *7 Elements of Successful Business Practices:* 1.*strategy* 2. *Structure* 3. *Systems* ="*hardware*" of success. 4. *Style* Five. *Skills* 6. *Staff* 7. *Shared Values* ="*Software*" of success.

3 transformative Forces Effecting Marketing 2.Globalization +Knowledge of the world + Multicultural + homogeneous marketing

*Globalization*- the *world* has become a *smaller place.* +New *transportation, shipping,* and *communication technologies* have made it *easier* for us to *know* the *rest of the world,* to *travel* to *buy* and *sell anywhere.* -----> By 2thousand and twenty five *annual consumption* in *emerging markets* will total *$thirty trillion* and contribute more than *7venty percent* of *Global GDP growth.*<----- +Globalization has made *countries increasingly multicultural.* ------> U.S. *Minorities* have much *economic clout,* and their *buying power* is *growing faster* than the *general population.*<------ + Companies can now *use marketing ideas* and *lessons* from *one country* and *apply* them to *another.* EX: *Ultrasound* marketed in China based on their *unique needs* has successfully been *introduced* throughout the *developed world.*

Who Markets? -Marketer -touch Points -Interdepartmental teamwork

*Marketer*- is someone who *seeks* a *response*--*attention*, a *purchase* a *vote*, a *donation*--from another party, called the *prospect.* +If *both parties* are seeking to *sell* something to *each other,* we call them *both marketers.* +Marketers now must properly *manage* all possible *touch points* <where a *customer* directly or indirectly *interacts* with the company.> --*touch points:* Store layouts, package designs, product functions, employee training, and shipping and logistics. -->to create a strong marketing organization, marketers must think like executives in other departments, and executives in other departments must think more like marketers. --*Interdepartmental teamwork*- Includes marketers needed to *manage* key processes like *production innovation, new-business development, customer acquisition* and *retention,* and *order fulfillment.*

Company Orientation toward the Market Place Marketing Concept

*Marketing Concept*- Emerged in the mid 19fifties as a *customer centered, sense-and-respond philosophy.* the Job is to *find* not the right customers for your products, but the *right products for your customers.* +the key to achieving organizational goals is being *more effective* than *competitors* in *creating, delivering,* and *communicating superior customer value* to your *target markets.*

Marketing Implementation, Control, and Performance: -Marketing Implementation +2 approaches to measuring marketing productivity 1. Marketing Metrics 2. marketing mix -Marketing Dashboard 1.Marketing Metrics 2 ways to evaluate 1. Short term 2. Changes in Brand Equity 2.Marketing Mix Modeling +3 Short comings: 3. Marketing Dashboard +2 Scorecards: 1.Customer Performance 2.Stakeholder performance 4. Marketing Control: +4 types: 1.Annual plan 2. Profitability 3. Efficiency 4. Strategic -Marketing Audit

*Marketing Implementation*- is the *process* that turns *marketing plans* into *action assignments* and ensures they *accomplish* the *plan's stated objectives.* +*2 Complementary approaches to measuring marketing productivity* 1.*Marketing Metrics*- to assess marketing effects 2. *Marketing-Mix modeling*- to estimate *causal relationships* and *measure* how *marketing activities* affect *outcome.* -*Marketing Dashboards*- are a *structured* way to *disseminate* the *insights* gleaned from these *two approaches.* 1.*Marketing Metrics*- is the *set of measures* that help marketers, *quantify, compare* and *interpret* their *performance.* +*2 ways to split evaluation:* 1.*Short-term results*- often reflect- *profit-and-loss concerns* as shown by *sales turnover, shareholder value,* or some combination of the two. 2.*Changes in Brand Equity*- Includes, *customer awareness, attitudes,* and *behaviors; market share; relative price premium; number of complaints; distribution;* and *availability; total number of customers; perceived quality;* and *loyalty* and *retention.* 2.*Marketing Mix Modeling*- Analyze *data* from a *variety of sources* such as *retailer scanner data, company shipment data, pricing, media,* and *promotion spending data,* to understand the *effects* of specific *marketing activities.* EX: *Proctor and Gamle* use findings from the *marketing mix model* to help *allocate* or *reallocate expenditures.* *3 Short comings of the marketing mix:* 1. Focus on *incremental growth* 2. Limited *customer satisfaction metrics* 3. *fails* to incorporate *metrics related to competitors.* 3.*Marketing Dashboards*- a concise *set* of *interconnected performance drivers* to be viewed in common *throughout organization.* *2 Key market-based Scorecards:* 1. *Customer Performance Scorecard*- records how well he company is doing year after year on such *customer based measures* as the *percentage of customers* who *say* they would *repurchase the product.* 2. *A Stakeholder Performance Scorecard*- tracks the *satisfaction* of various *constituencies* who have *critical interest* in and *impact* on the *company's performance:* employees, suppliers, banks distributors, retailers, and stockholders. 4. *Marketing Control*-is the process by which firms *assess* the *effects* of their *marketing activities* and make necessary *changes* and *adjustments.* *4 types of Marketing Controls:* 1.*Annual-Plan Control*- ensures the company achieves *sales, profits,* and other goals established in its *annual plan* 2. *Profitability Control*- is used to determine whether to *expand, reduce,* or *eliminate* any *product* or *marketing activity.* 3. *Efficiency Control*- Helps the company look a *better ways* to *manage marketing spending* and *investments.* 4. *Strategic Control*- the firm should *periodically reassess* its *strategic approach* to the *market place* using a *Marketing Audit*- a *comprehensive, systematic, independent,* and *periodic examination* of a company's or business unit's *marketing environment, objectives, strategies,* and activities,* to *identify problem areas* and *opportunities* and recommend a *plan* for *improving marketing performance.*

Marketing Management

*Marketing Management*- the art and science of *choosing target markets* and *getting, keeping*, and *growing* customers through *creating, delivering*, and *communicating* superior customer value. -->*Cocreation of value* among *customers* and with *businesses* and the importance of *value creation* and *sharing* have become *important* themes in the development of *modern marketing thought.*<--- +*Peter Drucker Quote:* "the aim of marketing is to *know* and *understand* the *customer* so well that the *product* or *service* fits him and *sells itself.* Ideally marketing should *result* in a *customer* who is *ready to buy.* All that should be needed is to *make* the *product* or *service available.*

Marketing Plan: +Contents of a Marketing Plan 1. Executive Summary 2. Situation Analysis 3. Marketing Strategy 4. Marketing tactics FIVE. Financial projections 6. Implementation Controls +From Marketing Plan to Marketing Action:

*Marketing Plan*-is a *written document* that *summarizes* what the marketer has *learned* about the *marketplace* and *indicates* how the firm *plans* to *reach* its *marketing objectives.* +It contains *tactical guidelines* as well as *financial allocations* over the *planning period.* +*Contents of A Marketing Plan:* 1.*Executive Summary and table of contents* 2. *Situation Analysis*- relevant *background data* on *sales, costs,* the *market, competitors,* and the *environment.* How we *define* the *market,* how *big is it,* how *fast* is it *growing,* and what are the relevant *trends* and *critical issues.* 3. *Marketing Strategy*- the *marketing manager defines* the *mission, marketing* and *financial objectives,* the *needs* the *market offering* is intended to *satisfy* as well as its *competitive positioning.* this requires *inputs* from areas such as *purchasing, manufacturing, sales, finance,* and *human resources.* 4. *Marketing tactics*- Here the *marketing manager outlines* the *marketing activities* that will be *undertaken* to *execute* the *marketing strategy,* including *decisions* about the *product* or *service offering, pricing channels* and *communications.* FIVE. *Financial Projects*- Financial projections include *sales forecast* <Month and product category>, and *expense forecast* <Broken down into finer categories>, and a *break-even analysis.* <how many units the firm must sell to offset its fixed costs and average per unit variable cost.> 6. *Implementation Controls*- Management *outlines* the *controls* for *monitoring activities* and *adjusting implementation.* typically, this section *spells out goals* and *budget* for *each month* or *quarter* so management can *review results* and take *corrective action* as needed. +*From Marketing Plan to Marketing Action:* -Most companies create *yearly marketing plans* -they *start planning* well *before* the *implementation date* to allow *time* for *marketing research, analysis, management review,* and *coordination* between *departments.* -As each *action program begins,* the *monitor ongoing results, investigate* any *deviation* from *plans,* take *corrective steps* as needed to keep *marketing performance on track.* some firms prepare *contingency plans* so they can *update* and *adapt* the *marketing plan* at *any time.*

What is Marketing? -Marketing

*Marketing*- Provide a *need/want* at a *reasonable price* and receive *feedback* on your product and *improve it* and again *exchange it* for something of *value.* <Money/Barter> Criterium: + Exchange is *voluntary* + *Need*- Basic needs: food, shelter safety + *Want*- Luxury ++Marketing only takes place when it's a *win-win* and this build *long-term Relationships.* EX: *Google* recognized that people needed to more effectively and efficiently access information on the internet, it created a powerful *search engine* that organized and prioritized queries. EX: *IKEA* noticed that people wanted good furnishing at substantially *lower prices,* it created *knockdown furniture.*

Updating the 4 P's of Marketing Old 4 P's -Product -Price -Place -Promotion New 4 P's - People - Processes - Programs - Performance

*Marketing-Mix*= *4 P's of marketing* 1.*Product*- Product variety, quality, design, features, brand name, packaging, services, warranties, returns 2. *Price*- List price, Discounts, Allowances, Payment period, Credit terms 3. *Promotion*- Sales promotion, Advertising, Sales force, public relations, direct marketing 4.*Place*- Channels, Coverage, Assortments, Locations, Inventory, transportation. Updated 4 P's to Reflect Holistic Concept 1. *People*- reflects, in part, *internal marketing* and the fact that *employees* are *critical* to *marketing success.* Marketers must also view *consumers* as *people* to *understand* their *lives more broadly* and not just as shoppers who consume products and services. 2. *Processes*- are all the *creativity, discipline,* and *structure* brought to *marketing management.* +Marketers must *ensure* that *state-of-the-art marketing ideas* and *concepts* play an *appropriate role* in *all they do,* including *creating mutually beneficial long-term relationships* and imaginatively generating *insights* and *breakthrough products, services,* and *marketing activities.* 3. *Programs*- Are all the *firm's consumer-directed activities,* encompassing the *old 4 p's* as well as a range of *other marketing activities* that might *not fit* as neatly into the *old view* of marketing. 4. *Performance*- the *range* of *possible outcome measures* that have *financial* and *non financial implications.* +*Profitability* as well as *brand* and *customer equity* and implications *beyond* the *company* itself like, *social responsibility, legal, ethical,* and *community related.*

Needs, Wants, and Demands +FIVE types of NEEDS

*Needs*- are the *basic human requirements* such as for are, food, water, clothing, and Shelter. +Also includes needs for *recreation, eduction,* and *entertainment.* *Wants*- Needs become wants when directed to *specific objects* that might *satisfy need.* + A U.S. consumer needs food but may want a Chicago-style "*deep dish*" pizza and a craft beer. + Our Wants are *shaped* by our *society.* *Demands*- are wants for specific products backed by an *ability to pay.* + Many people want a Mercedes; only a *few* can *buy one.* + Companies must *measure* not only how many people want their product, but also *how many* are *willing* and *able* to *buy it.* ----> *Marketers* do *not create needs:* Needs *pre-exist* marketers.<----- +Ex: Marketers might *promote* the *idea* that a Mercedes satisfies a person's *need* for *social status.* they *do not*, however, *create* the *need for social status.* *FIVE types of NEEDS:* 1. *Stated Needs*- the customer wants an *inexpensive Car.* 2. *Real Needs*- the Customer wants a car whose *operating cost*, not initial price, is *low.* 3. *Unstated Needs*- the Customer *expects good service* from the dealer. 4. *Delight Needs*- the Customer would the dealer to *include* an onboard *GPS system.* FIVE. *Secret Needs.*- the customer wants *friends* to *see him* or her as a *savvy consumer.* --->to gain and *edge,* companies must *help customers learn* what they *want.*<----

Value Delivery Process

*New View* of *business processes* place *marketing* at the *beginning* of *planning.* Instead of emphasizing making and selling, *companies* now *see themselves* as *part of a value delivery process.* 3 Phases of *Value Creation:* 1.*Choosing the Value*- Marketers *segment* the *market, select* the *appropriate target,* and *develop* the *offering's value positioning.* +the *Formula* "*Segmentation, targeting, Positioning* <*StP*> is the essence of *strategic marketing.* 2.*Providing the Value*- through identifying specific *product features, prices,* and *distribution. 3. *Communicating the Value*- by *utilizing* the Internet, advertising, sales force, and other *communication tools* to *announce* and *promote* the *product.* ---->the *Value Delivery Process* begins *before* theres is a *product* and *continues* through *development* and *after launch.*<-------

Supply Chain +Vertical/Horizontal Integration

*Supply Chain*- is a longer stretching channel stretching from *raw materials* to *components* to *finished products* carried to the *final buyers.* EX: Supply Chain for *Coffee* *Farmers* sell------>*Wholesalers* preps coffee beans and *transports* for *sale*-----> *Wholesale* or *Retail Channels.* +*Each company* in the *chain* only captures a certain *percentage* of the *total value generated* by the supply chain's *value delivery system.* -----> When a Company *acquires competitors* or *expands upstream* or *downstream,* its aim is to *capture* a *higher percentage* of *supply Chain Value*<----- -*Expanding Upstream or Downstream*= *Vertical Integration*- *One* Firm *owning* different *parts of production* in the supply chain. -*Acquiring Competitors*=*Horizontal Integration*- when a company *acquires competitors* in the *same industry* doing the *same stage of production.*

Value Chain

*Value Chain*- tool for *identifying ways* to *create* more *customer value.* +*9 strategically relevant activities create value and cost in a specific business:* -Five primary -4 Secondary *FIVE Primary Activities:* 1.*Inbound Logistics*- bringing *materials* into the *business.* 2. *Operations*- Converting *materials into final products.* 3. *Outbound Logistics*- *shipping out final product* 4. *Marketing*- Sales FIVE. *Service*- specialized *departments* handle the *support activities.* *4 Support activities:* 1. *Procurement* 2. *technology Development* 3. *Human Resource management* 4. *Firm Infrastructure* <General management, planning, finance, accounting, legal, and government affairs.> + the *Firm's task* is to *examine* its *costs* and *performance* in each *value-creating activity, Benchmarking* against its *competitors,* and look for ways to *improve.* + the *Firm's Success* depends not only on how well each department performs its work but also on how well the company *coordinates departmental activities* to conduct *core business processes.* -*Core Business Processes:* 1. *the Market-Sensing Process*- *Gathering* and *acting* upon *information* about the *market* 2. *New-Offering Realization Process*- Researching, developing and *launching new high quality offerings* quickly and within the budget 3. *the Customer Acquisition Process*- defining *target markets* and *prospecting* for *new customers.* 4. *the Customer Relationship Management Process*- Building *deeper understanding* of, *relationships with,* and *offerings* for *individual customers.* FIVE. *the Fulfillment Management Process*- Receiving and approving orders, shipping goods on time, and collecting payment. *Value delivery Network*- also called a *supply Chain* are the *partnered suppliers* and *distributors* in the *creation* of a *final product.*

3 transformative Forces effecting Marketing 1. technology: - 3 implications

*technology:* 1. the rise of *e-commerce*, the *mobile internet,* and *web penetration* in emerging markets, *brand marketers* must *enhance* their "*digital balance sheets.*" 2. Massive amounts of *information* and *data* about almost everything are now *available* to *consumers* and *marketers.* It's predicted that *Chief Marketing Officers* will spend *more time* on *information technology* than *Chief Information Officers.* 3. "*information is power*" is giving way to the *new idea* that "*Sharing Information is Power.*" EX: Drug Maker *Roche* decided to issue *iPads* to its entire *sales team* to *improve sales force effectiveness.* +Sales Personnel can do *Real-time data entry, improving* the *quality* of the *data entered* while *freeing up time* for *other tasks.*

the Value of Marketing

+ *Financial Success* often depends on *marketing ability.* + Succesful Marketing *builds demand* for products and services, which in turn, *creates jobs.* + By contributing to the bottom line, successful marketing also allows firms to more fully *engage in socially responsible activities.*

Marketing Management tasks 1. Developing and Implementing Marketing strategies and Plans 2. Capturing Marketing Insights 3. Connecting with Customers 4. Building Strong Brands Five. Creating value 6. Delivering Value 7.Communicating Value 8. Managing the Marketing Organization for long term success

1. *Developing and Implementing Marketing Strategies and Plans*- the first task is to *identify* and *plan* for the *organizations* potential *long-run opportunities,* given its *market experience* and *core competencies* 2. *Capturing Marketing Insights*- Each organization should closely *monitor* its *marketing environment,* continually assess *marketing potential,* and *forecast demand.* 3. *Connecting with Customers*- Management must decide how to best *create value* for firm's chosen *target markets* and how to *develop strong, profitable, long-term relationships* with *customers.* 4. *Building Strong Brands*- the organization must *divide* the *market* into major *market segments, evaluate each one,* and *target those it can best serve.* Next it needs to *craft* a *brand positioning* and *plan* to *compete effectively*. Also it should *understand* how *customers perceive its brand* and *plan for growth.* FIVE. *Creating Value*- the *product* or *tangible offering* to the *market* which includes--*quality, design, features,* and *packaging.* Design and *market services.* Critical marketing decisions related to *pricing.* 6. *Delivering Value*- Based on its *products* and *services,* how can the firm *deliver value to its target market?* *Channel activities* needed to make the *product accessible* and *available* to customers. Marketing decisions made by *retailers, wholesalers* and *physical-distribution firms.* 7. *Communicating Value*- Communicating *offerings* to the *target market* this requires an *integrated marketing program* that maximizes the *individual* and *collective contribution* of *all communication activities. 8. *Managing the marketing organization for long term success*- the *market strategy* should take into account *changing global opportunities* and *challenges* as well as *social responsibility* and *ethics.* Management must also *establish* an appropriate *marketing organization

Brand category membership

1. Announcing category benefits - reassure consumers that a brand will deliver on fundamental reason for using a category 2. Comparing to exemplars - well-known, noteworthy brands in a category can also help a brand specify its category membership 3. Relying on the product descriptor - product descriptor that follows the brand name is often a concise means of conveying category origin

Benefits of vertical coordination

1. Basic buying and selling 2. Bare bones - less cooperation and info exchange 3. Contractual transaction - low levels of trust, cooperation, and interaction 4. Customer supply - competition rather than cooperation 5. Cooperative systems - no structural commitment through legal means or adaptation 6. Collaborative - much trust and commitment 7. Mutually adaptive - make many relationship specific adaptations without achieving strong levels of trust or cooperation 8. Customer is king - seller adapts to meet the customers need without expecting much adaptation or change in exchange

5 elements of narrative branding

1. Brand story in terms of words and metaphors 2. Consumer journey or the way consumers engage with the brand over time and touch points where they come into contact with it 3. Visual language or expression for the brand 4. Manner in which the narrative is expressed experientially or the brand engages the senses 5. Role the brand plays in the lives of consumers

Growth Strategies

1. Building market share 2. Developing committed customers and stakeholders 3. Building a powerful brand 4. Innovating new offerings and experiences 5. Expanding internationally 6. Arranging acquisitions, mergers, and alliances 7. Building an outstanding reputations for social responsibility 8. Partnering with government and nongovernment org.

Deciding on a positioning requires

1. Choosing a frame of reference by identifying the target market and relevant competition 2. Identifying the optimal points of parity and points of difference brand associations given that frame of reference, including emotional branding 3. Creating a brand mantra summarizing the brands positioning and essance

3 criteria that determines whether a brand association can truly function as a point of difference

1. Desirable to consumer - Consumers see the brand association as personally relevant to them 2. Deliverable by the company - Company must have the resources and commitment to feasibly and profitably create and maintaing the brand association in minds of consumers 3. Differentiating from competitors - Consumers see the brand association as distinctive and superior to relevant competitors

Briefly describe the eight major marketing tasks that marketers are currently responding to (Chapter 1 pg 14-15) Not to sure how thorough these definitions are. Might want to read over the specific chapters to get a better grasp of each concept and come up with organic definition.

1. Developing and implementing marketing strategies and plans - The first task is to identify and plan for the organization's potential long-run opportunities, given its market experience and core competencies (see ch 2) >>Planning Corporate > Division > Business > Product >>Implementing Organizing > Implementing >>Controlling Measuring results > Diagnosing results > Taking corrective action - EX: 2. Capturing marketing insights - Each organization should closely monitor its marketing environment, continually assess marketing potential, and forecast demand. (ch 3 looks at marketing information and research, market demand, and the marketing environment) -EX: 3. Connecting with customers - Management must decide how to best create value for the firm's chosen target markets and how to develop strong, profitable, long-term relationships with customers. (ch 4 & 5) -EX: 4. Building strong brands - The organization must divide the market into major market segments, evaluate each one, and target those it can best serve. (ch 6) -EX: 5. Creating value - At the heart of the marketing program is the product - the firm's tangible offering to the market - which includes the product quality, design, features, and packaging. (ch 9) (ch 10 looks at how firms can design and market services, and ch 11 examines critical marketing decisions related to pricing) -EX: 6. Delivering Value -Based on its products and services, how can the firm deliver value to its target market? (ch 12) (ch 13 explored the marketing decision made by retailers, wholesalers, and physical-distribution firms) -EX: 7. Communicating value -Each marketer needs to communicate to the target market the value embodied by its offerings. This requires an integrated marketing program that maximizes the individual and collective contribution of all communication activities (ch 14). (Ch 15 examines mass communications such as advertising, sales promotion, events, and public relations, while ch 16 discusses online, social media, and mobile options for reaching consumers. Ch 17 looks at personal communications such as direct and database marketing as well as personal selling.) -EX: 8. Managing the marketing organization for long term success - The marketing strategy should take into account changing global opportunities and challenges as well as social responsibility and ethics. Management must also establish an appropriate marketing organization. (ch 18) -EX:

3 transformative Forces Effecting Marketing + Overview: -Channels of Distribution +Disintermediation +Reintermediation -Private labels, Mega-Brands, Deregulation and Privatization -Brands Intangible Assets

1. One reason *consumers* have *more choices* is that *channels of Distribution* have *changed.* +Retailers are building *entertainment* into their stores with *coffee bars, demonstrations,* and *performances.* marketing an "*experience*" rather than a product assortment to address *enhanced competition.* -*Disintermediation*- *Reduction* in the amount of *intermediaries* between *producers* and *Consumers.* EX: As seen by *Amazon* and its *delivery* of *products* and *services* by *intervening* in the *traditional flow of goods.* -*Reintermediation*- the *insertion* of *middlemen* into *transactions* between *producers* and *consumers.* EX: *traditional companies* are becoming "*brick-and-Click*" *retailer,* adding *online services* to their *offerings.* 2. While globalization has created intense competition among domestic and foreign brands, the *rise* of *Private Labels,* <marketed by *powerful retailers*> and *Mega-Brands*< and *brands extended* into *related product categories*> plus a *trend* toward *deregulation* and Privatization* have also *increased competition.* -*Private Labels*- a *retailer's name*, as *used on* a *product sold by* the *retailer* but *manufactured by another company.* -*Mega-Brands*- extremely *popular brand.* -*Deregulation*- Creates *greater competition* and *growth opportunities.* -*Privatization*- changing ownership of a *public company* to *private ownership* to *increase efficiency,* which *adds* to the *competitive pressure.* 3. Organizations recognize that much of their *market value* comes from *intangible assets,* particularly *brands, customer base, employees, distributor* and *supplier relations,* and *intellectual capital.* +Firms are applying *more metrics* such as, *Brand equity, customer lifetime value, return on marketing investment* to understand and *measure* their *marketing* and *business performance* and a *broader variety* of *financial measures* to assess the *direct* and *indirect value* their *marketing efforts create.*

Consumer buying decision making process

1. Problem recognition - triggered by internal or external stimuli 2. Information search - personal (family, friends), commercial (ads, web sites, salespeople), public (social media, mass media), experiential (handling, using the product) 3. Evaluation of Alternatives 4. Purchase decision 5. Postpurchase behavior

Companies need two proactive skills

1. Responsive anticipation to see the writing on the wall, as when IBM changed from a hardware producer to a service business 2. Creative anticipation to devise innovative solutions

3 Variables when analyzing competitors

1. Share of Market - Competitors share of target market 2. Share of Mind - Percentage of customers who named the competitor in responding to the state "name the first company that comes to mind in this industry" 3. Share of Heart - Percentage of customers who named the competitor in responding to the statement "name the company from which you would prefer to buy the product"

3 Ingredients of customer-based brand equity

1. brand equity arises from differences in consumer response. If no difference, the brand-name product is essentially a commodity, and competition will probably be based on price 2. Differences in response are a result of consumers brand knowledge (thoughts, feelings, images, experiences, and beliefs associated with the brand) 3. Brand equity is reflected in perceptions, preferences, and behavior related to all aspects of the brands marketing

Branding Decisions

3 strategies are popular: Individual or separate family brand names: use different brand names for different quality lines within the same product class (adv. is if product fails comp. has not tied reputation to it Corporate umbrella or company brand name: use corporate brand as an umbrella brand across their entire range of products (such as GE) Sub-brand name: combine two or more of the corporate brand, family brand, or individual product brand names. Ex: Kellogg, by combining corporate brand with individual product brand as with Kellogg's Rice Krispies

Personal Factors

Age and stage in the life cycle Occupational & economic circumstances - Personality and self concept - Brand Personality (specific mix of human traits that we can attribute to a particular brand) -Actual self-concept - how we view ourselves -Ideal self concept - how we like to view ourselves -Others self concept - how we think others see us Lifestyle and values - shaped partly by whether consumers are money constrained or time constrained

Brand Equity Models

BrandAsset Valuator - Covers four pillars of brand equity (Energized Differentiation, Relevance, Esteem, Knowledge). Strong new brands show higher levels of energized differentiation and energy than relevance. Leadership brands show high levels on all pillars, with strength greater than stature. Declining brands show high knowledge, lower level of esteem, and even lower relevance and energized differentiation. BrandZ and BrandDynamics - Based on a system of brand associations (Meaningful, different, and salient) that builds customer predisposition to buy a brand. The associations have 3 outcome measures: Power (prediction of brand volume share), Premium (ability to command a price premium), and Potential (probability that a brand will grow value share). Brand Resonance Model - Brand building as a series of steps. Enacting these four steps means establishing a pyramid of 6 brand building blocks. Emphasizes the duality of brand.

Offerings and Brands -Value Proposition

Companies address *customer needs* by putting forth a *Value Proposition* -*Value Proposition*- A set of *benefits* that *satisfy* those needs. the intangible value proposition is *made physical* by an *OFFERING*, which can be a combination of *products, services, information,* and *experiences.* -*Brand*- a brand is a *offering* from a *known source.* EX: A brand *name* such as *Apple* carries many *different* kinds of *associations* in *people's minds* that make up its *image:* creative, innovative, easy-to-use, fun, cool, iPhone, and iPad to name just a few. +All companies strive to *build* a *brand image* with strong, favorable, and *unique brand associations.*

Cultural factors

Culture - fundamental determinant of a persons wants and behavior. Child growing up in U.S has different views of someone growing up in another country Subcultures provide more specific identification and socializations for their members (nationalities, religion, race) Social classes - relatively homogeneous and enduring divisions in a society, hierarchically ordered and with members who share similar values, interests, and behavior

Positioning and branding for a small business

Find a compelling performance advantage Focus on building one or two strong brands based on one or two key associations Encourage trial in any way possible Develop a digital strategy to make the brand "bigger and better" Create buzz and a loyal brand community Employ a well-integrated set of brand elements (Brand names, logos, packaging) Leverage secondary associations (any persons, places, or things with potentially relevant associations) Creatively conduct marketing research

Roles as part of a portfolio

Flankers - Position with respect to competitors brands so that more important (and more profitable) flagship brands can retain their desired positioning. Must be in the middle of their higher-priced brands Cash Cows - Some brands may be kept around despite dwindling sales because they manage to maintain their profitability with virtually no marketing support. Low-end entry level - Role of a relatively low priced brand in the portfolio often may be to attract customers to the brand franchise High-end prestige - Role of a relatively high-priced brand often is to add prestige and credibility to the entire portfolio

Growing the Core

Focusing on the most successful existing products and markets It strengthens a brands credentials as a source of authority and credibility and can yield economies of scale

Chapter 3 Capturing Marketing Insights and Forecasting Demand

Get R Done

Chapter 8: Creating Brand Equity and Driving Growth

Get er done

Expanding total market demand

Market leader should look for new customers or more usage from existing customers A company can search for new users among three groups: those who might use it but don't (market-penetration strategy), those who have never used it (new market segment strategy), or those who live elsewhere (geographical-expansion strategy) Marketers can try to increase the amount, level, or frequency of consumption and boost the amount through packaging or product redesign

Brand Reinforcement

Marketers can reinforce brand equity by consistently conveying the brands meaning in terms of 1. what products it represents, what core benefits it supplies, and what needs it satisfies; and 2. how the brand makes products superior and which strong, favorable, and unique brand associations should exist in consumers minds Reinforcing brand equity requires that the brand always be moving forward in the right direction and with new and compelling offerings and ways to market them.

Central Role of Strategic Planning 3 areas to prioritize in strategic planning: 4 Organizational Levels of a Company: -Marketing Plan -Strategic Marketing Plan -tactical Marketing Plan

Marketers must *prioritize strategic planning in 3 key areas.* 1.*managing* their *business* as an *investment portfolio.* 2. *Assessing* the *market's growth rate* and the *company's position* in that *market.* 3. *Establishing a strategy* *4 Organizational levels of a company:* 1. Corporate- Allocates resources 2. Division- Allocates funds 3. Business Unit- *strategic plan* for business unit 4. Product- *tactical Plan* plan to achieve Objectives -*Marketing Plan*- is the *central instrument* for *directing* and *coordinating* the *marketing effort,* operating at *both strategic* and *tactical levels.* -*Strategic Marketing Plan*- Lays out the *target markets* and the *firm's value proposition,* based on an *analysis* of the *best market opportunities.* -*tactical Marketing Plan*- Specifies the *marketing tactics,* including *product features, promotion, merchandising, pricing, sales channels,* and *services.*

Impressions and Engagement

Marketers now think of *3 "screens"* or *means* to *reach consumers:* t.v., Internet, and Mobile. -*Impressions*- which *occur* when *consumers view a communication* are useful *metrics* for *tracking* the *scope or breadth* of a *communications reach.* that can also be *compared* across all *communication types.* ----> the *downside* is that *impressions don't* provide any *insight* into the *results* of *viewing the communication.* -*Engagement*- is the *extent* of a *customer's attention* and *active involvement* with a *communication,* ---->More likely to *create value* for the *firm.*<---- EX: Some *online measures* of *engagements* are *Facebook "Likes," twitter tweets, comments* on a *blog* or *Web site,* and *sharing* of video of other content.

Integrated Marketing

Mixing and matching marketing activities to maximize their individual and collective effects

Key psychological processes

Motivation - Biogenic (states of tension such as hunger, thirst, discomfort) Psychogenic (tension such as need for recognition, esteem) Perception - how we interpret information -Selective attention - only paying attention to select things - Selective distortion - tendency to interpret info in a way that fits our preconceptions -Selective retention - remember good points about a product we like and forget good points about competing products Learning Emotions Memory - Associative network memory model views long term memory as a set of nodes and links

Brand

Name, term, sign, symbol, or design, or a combination of them, intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors.

Defensive Marketing

Positioning defense - occupying the most desirable position in consumers minds Flank Defense - protect a weak front or support a possible counterattack Preemptive defense - attack first, perhaps with guerrilla action across the market, hitting one competitor here, another there, to keep everyone off balance Counteroffensive defense - meet the attacker frontally so the rival will have to pull back to defend itself Mobile defense - stretches its domain over new territories through market broadening and market diversification Contraction defense - can no longer defend all their territory and give up weaker markets and reassign resources to stronger ones

Perceptual Maps

Visual representations of consumer perceptions and preferences Provide pictures of market situations & way consumers view different products, services, and brands along various dimensions

Paid, Owned, and Earned Media 3 Categories: -Paid Media -Owned Media -Earned Media

We can group *communication options* for *interacting with customers* into *3 Categories.* 3 Categories: 1. *Paid Media*- Include *t.v., magazine* and *display ads, paid search,* and *sponsorships,* all of which allow marketers to *show* their *ad* or *brand* for a *fee.* 2. *Owned Media*- Are communication channels marketers actually *own*, like a *company* or *brand brochure, Web Site, Blog, Facebook page,* or *twitter account.* 3. *Earned Media*- are streams in which *consumers,* the *press,* or other *outsiders voluntarily communicate* something about the brand via *word of mouth, buzz,* or *viral marketing methods.* +the emergence of *Earned Media* has allowed some companies, such as Chipotle, to *reduce paid media expenditures.*

Essay questions

Worth 25 pts. each. Questions are required to have Concept identification - 10 pts Concept definition - 10 pts Concept explanation with specific examples - 5 pts

Marketing Environment 1. task Environment +Company, Suppliers, Distributors, Dealers and target customers 2. Broad Environment + 6 Components:

the *marketing environment* consists of the *task environment* and the *broad environment.* 1. *task Environment*- Includes the *actors* engaged in *producing, distributing,* and *promoting* the *offering.* +these include the *Company, Suppliers, Distributors, Dealers,* and *target Customers.* ++In the *Supplier Group* are *material suppliers* and Service suppliers,* such as *marketing research agencies, advertising agencies, banking* and *insurance companies, transportation companies,* and *telecommunications companies.* ++*Distributors and Dealers* include *agents, brokers, manufacturer representatives,* and Other who *facilitate finding* and *selling* to customers. 2. *Broad Environment*- Consists of *6 components:* 1.*Demographic Environment* 2. *Economic Environment* 3. *Socia-Cultural Environment* 4. *Natural Environment* Five. *technological Environment* 6. *Political-Legal Environment* ---->Marketers must pay *close attention* to the *trends* and *developments* in these and *adjust* their *marketing strategies* as needed.<-------

Customer-Perceived Valued (CPV)

the difference between the prospective customer's evaluation of all the benefits and costs of an offering and the perceived alternatives

population

the main demographic factor marketers monitor including the size and growth rate of population in cities, regions, and nation; age distribution and ethnic mic; education levels; and household patterns

Marketing Channels 3 types of Channels 1. Communication Channels 2. Distribution Channels 3. Service Channels

to *reach* a *target market*, the marketer uses *3* kinds of *marketing channels.* 1.*Communication Channels*- *Deliver and receive messages* from *target buyers* + include: *newspapers, magazines, radio, television, mail telephone, smart phone, billboards, posters,* and the *internet.* Firms also communicate through the *look* of their *retail stores* and *Web sites* and other media, adding dialogue channels such as e-mail, blogs, text messages, and URLs to familiar monologue channels such as *ads.* 2.*Distribution Channels*- help *display, sell* or *deliver* the *physical product* or *service* to the *buyer* or *user.* +these channels may be *Direct* via the *internet, mail, mobile phone or *telephone* or *Indirect* with *distributors, wholesalers, retailers,* and *agents as intermediaries.* 3.*Service Channels*- to carry out *transactions* with potential *buyers,* marketers also use service channels. +Includes: *Warehouses, transportation companies, banks* and *insurance companies.* --->Marketers clearly face a *design challenge* in choosing the best mix of *communication, distribution,* and *service channels.*<----