Marketing Management

What is the importance of 1) personality and 2) motivation in consumer behaviour?

1) Marketing found that a lot of our decisions are not simply based on the information we get from markets, but rather from ourselves and our personality. "If you can understand yourself, you can understand your choices" - Personality: that aspect of our psyche which determines how we respond to our environment in a relatively stable way over time (Baines & Fill, 2014). There are 3 main theories: 1) The psychoanalytic approach which stresses self-reported unconscious desires (By Freud). 2) Trait theory which stresses the classification of personality types, where the different personality types have different traits and characteristics. The assumption is that these are pretty stable. E.g. Colour test. 3) The self-concept approach, which is concerned with how we perceive ourselves as consumers. Self-concept: the complex mental picture that people have of themselves (Kotler et al, 2013).• Consumers tend to chose brands that resemble how we perceive ourselves (real or desired self-concept) and that reflect our personality • Marketers can use this information to segment markets and to better know how to communicate with their target • A Levis ad expresses the brand personality: youthful, rebellious, authentic, American (Fonte: Kotler & Keller (2006): p. 182) • Marketing communications can influence a consumer's level of self- esteem, often by triggering a process of social comparison. E.g. AXE commercial • Buyers of luxury products may be motivated by their desire to impress others, their ability to pay high prices and the ostentatious display of their wealth • Self-gift giving illustrates how consumers may engage in consumption experiences because of identity-related motivations (e.g. to enhance one's self-esteem, to cheer oneself up, to reward oneself) (e.g. Mick and DeMoss, 1990) 2) Motivation: refers to the processes that cause people to behave as they do. It occurs when a need is aroused (when there is a discrepancy between a desired and an actual state) that the consumer wishes to satisfy (Baines & Fill, 2014; Solomon et al, 2014; Kotler et al, 2013). Tend to be driven be psychosocial and biological needs. Most famous theory of needs is Maslow's Hierarchy of Needs. If you are marketer, you can position yourself according to the needs. Most advertising tend to use a combination of these different needs and desires (e.g. "sex sells"). The implication of Maslow's hierarchy is that one must first satisfy basic needs before progressing up the ladder (e.g. a starving man is not interested in status symbols or self-fulfilment) • Criticisms include: being too simplistic and ignoring individual and cultural differences - this order does not necessarily apply to every individual, culture, or context. • The same product may satisfy different needs in the ladder. In the wealthier countries, where basic survival needs have long been taken for, what drives consumers is often emotion and aesthetic needs - consumers look for things which are pleasurable and fun (Blythe, 2008) - self-fulfilment needs • Sometimes, our need for excitement and pleasure overrides our need for security and survival (Blythe, 2008).

Does everybody agree on the definition of marketing?

People do still not completely agree on what marketing is... But they do have common elements...e.g. the words used to describe marketing, as an 'process, activity or endeavor'

Branding issues in context

Positioning and the marketing mix: o Firms must deliver and communicate the desired position to target consumers o All the company's marketing-mix efforts must support the positioning strategy

Explain the concept of price elasticity of demand

Price elasticity of demand is a measure of the relationship between a change in the quantity demanded of a particular good and a change in its price. Price elasticity of demand is a term in economics often used when discussing price sensitivity. The formula for calculating price elasticity of demand is: Price Elasticity of Demand = % Change in Quantity Demanded / % Change in Price. This helps with the demand oriented approach.

Define price, and understand its relationship with costs, quality, value and customer perceptions.

Price is the amount of money charged for a product or service, or the sum of the values that consumers exchange for the benefits of having or using the product or service. -> Very narrow definition

Pure good vs pure service?

Pure good = do not include any service Pure Service = do not include any service Hard to find either in pure form in reality.

Understanding the Internal Environment: what is the point of this?

An analysis of the internal environment of an organization is concerned with understanding and evaluating the capabilities and potential of the products, systems, human, marketing and financial resources.

Define digital marketing and social media marketing.

Digital marketing is the management and execution of marketing using digital technologies and channels to reach markets in a timely, relevant, interactive and cost-efficient manner. Social media marketing: Is a form of digital marketing, which uses social networking sites to produce content that users will share, which, in turn, create exposure of the brand to customers and thereby increase or reinforce its customer base

Explain learning, and memory in relation to consumer choice

Learning is the process by which we acquire new knowledge and skills, attitudes and values through study, experience, or modelling others' behaviour (Baines & Fill, 2014). Theories of human learning include: • Classical Conditioning • Operant Conditioning • Social Learning Our memory, in turn, is inaccurate in what we remember. This is because of our perceptual businesses, but also the brain itself. We tend to remember perceptions or feelings, which means that they are not objective. The information inaccurate recall affects our memory on brands etc.

Product Lifecycle

Like a business life cycle: - Intro stage - Growth stage - Maturity phase - Decline stage: here, can either let your product die or renew it.

Definition of market segmentation

Market segmentation is the division of a market into different groups of customers with distinctly similar needs and proposition requirements (Baines & Fill, 2014)

Needs vs. Desires/wants. What is the difference?

Needs vs desire vs wants... the distinction is key for marketing. o Need: what we have to have to survive, of the upmost importance and basic levels → in accordance of Maslows hierarchy of needs o Desire: Something we would simply like. Marketing cannot create the need for something, e.g. we are born with the need for food. What marketing CAN do is direct desire and want. The successful campaigns direct the desires. People are motivated to act. E.g. if you are thirsty, you need water. However, desires are a bit more abstract that wants. you may desire a fizzy drink and want a specific one, like Fanta. The distinction is very important

What is Social learning?

Social learning • Bandura (1977) argued that we are less animalistic than the behaviourist school of learning suggests • We can learn not only from how we respond to situations but also from how others respond to situations. In social learning, we learn by observing the behaviour of others (modelling) • Profound implications for marketers (e.g. power of customers' reviews for companies like Amazon)

Discuss the concept of positioning.

The next step after targeting is positioning, as usually done with a perceptual map. • Positioning can be defined as: The act of designing the company's offering and image so that they occupy a meaningful and distinct competitive position in the target customers' minds. o Has two fundamental elements: 1) Physical attributes - the functionality and capability that a brand offers. 2) Communication - the way in which a brand is communicated and how consumers perceive the brand relative to other competing brands in the market place. Often, this is really important in changing the positioning of the brand in the customers mind.

The Marketing Research process: what is it? Source: Baines and Chansarkar (2002)

There are numerous basic stages that guide a marketing research project. The first, most crucial, stage involves problem definition and setting the information needs of the decision-makers. Problem definition does not always imply that threats face the organisation. The initial stage allows the organisation to access its current position, define its information needs, and make informed decisions about, define its information needs, and make informed decision about the future. 1) Stage 1, problem definition: this process occurs when an organization provides a marketing research brief defining the management problem, e.g. decrease in sales. This leads to the development of a marketing research question. This question may include a number of sub-questions for further exploration. The marketing research question transforms the management problem into a question while trying to remove any assumptions made by the organisation's management. Sometimes management problem is clear. Sometimes the problem is clear, other times it isn't. 2) Stage 2, decide the research plan: At this stage, we decide whether or not to undertake primary or secondary research or both. We would usually start with secondary research. This we can get from the government, the internet, company records or market research companies. - Qualitative versus quantitative research: at the outset of the project, we might consider whether to use qualitative research or quantitative research, or both. The choice depends on the circumstances of the research project and its objectives. If much is known about the management problem based on past experience/research, it may be more appropriate to use quantitative research to understand the problem further. - Quantitative research methods, e.g. survey questionnaire, are designed to elicit responses to pre-determine standardised questions from many respondents. This involves collecting information, quantifying the responses as frequencies or percentages, and descriptive statistics, and analysing them statistically. Other quantitative research methods include mass observation techniques and experiments. - Qualitative research methods, in contrast, are used to identify factors affecting management problem. They uncover the underlying motivations behind consumers opinions, attitudes, perception, and behaviour, adopting unstructured or semi-structured methods to elicit information from respondants. 3) Stage 3, data collection and sampling: This stage involves the conduct of fieldwork and the collection of data. At this stage, we send out questionnaires, or run the outline focus group sessions, or conduct a netnographic study, depending on the decisions taken in the first design stage of the fieldwork.The procedures undertaken when conducting the fieldwork might relate to how to ask the questions of the respondents. 4) Stage 4, data analysis and interpretation: this stage comprises data input, analysis, and interpretation. How the data are input depends on the type of data collected. Qualitative data, usually alphanumeric, is often entered into computer software applications. Quantitative data analysis uses statistical analysis packages. Information obtained needs to be valid and reliable as company resources are deployed on the basis of the information gleaned. 5) Stage 5, report preparation and presentation: the final stage of a research project involves reporting the results and the presentation of the findings of the study to the external or in-house client. The results are meant to be presented free from bias.

What does the term 'consumer' mean? Who is this?

There is a difference between the organizational consumer (businesses, government and institutions) and the individual consumer (end users and buyers vs. users). NOTE: There is a difference between the consumer and the customer, i.e. a difference between the buyer and the user. o The consumer is the one who consumes the product o The customer is the one who pays for the product or service o E.g. a parent and their kids: the parent buys the product but it is the child who will consumer it

What is marketing?

"The management process of anticipating, identifying and satisfying customer requirements profitably" (CIM, 2001). Academic definition: "Marketing is the endeavour of adapting organisations to their competitive markets in order to influence, in their favour, the behaviour of their publics, with an offer whose perceived value is durably superior to that of the competition" (French trans.: Lendrevie, Lévy and Lindon, 2006)

Explain cost-, competitor-, demand-, and value- oriented approaches to pricing

**The cost-oriented pricing approach** Works on the basis that most important element in pricing offering is cost of productions. If we can make a set amount above what our product costs are, we earn a profit. One approach is mark-up pricing (used in retail sector). • To exemplify concept, we use the example of a computer company selling high-quality laptop computers, at a cost of £1,000 per unit to make. Suppose computer company uses the mark-up pricing method, adding 67%. The final price set would be given by the equation below: Sales price (£) = (mark-up* x cost) + cost = (0.67 x 1,000) + 1,000 = £1,670 Do not confuse with Gross Margin, given by the equation below: Gross Margin % = (mark-up / sales price) x 100 = (670/1,670) x 100 = 40.11% **The demand-oriented pricing approach** Works on the basis that firm sets prices according to how much customers are prepared to pay. • Best known in airline industry, where different groups of customers pay different amounts for airline seats with varying levels of service attached. • For example: • Analysing the price-demand relationship - price discrimination **The competitor-oriented pricing approach** In this approach, companies set their prices based on the prices of their competitors, the so-called 'going rate'. This is also called 'me-too' pricing. • The advantage of this approach is that when your prices are lower than your competitors, customers are more likely to purchase from you, providing that they know that your prices are lower, which is not always the case. **The value-oriented pricing approach** Setting price based on the buyers' perceptions of product values rather than on the cost. • Underlying principle is to offer the right combination of quality and good service at a fair price. • Everyday low pricing is an important aspect of value pricing at the retail level.

Identify and define the three key areas of the marketing environment

- External environment = Marcro. - Performance environment = Micro. - Internal environment. The marketing environment consists of 3 areas: external, performance, and internal. By understanding the nature and trends of the elements that make up these linking environments, an organization can strategize for the short and long term. Both the micro and the macro environment are outside the immediate control of the company.

What is the price relationship with quality?

- It is a complex relationship. There is an assumption that as price increases so does quality. However, research suggests that there is only a weak relationship. - The idea that price indicates quality assumes that prices are accurately determined by market forces

Product Mix - the key product terms?

- Product item: A distinct single product within a product line. E.g. IPhone 6 - Product line: A group of closely related products - related through technical, marketing or user considerations. E.g. All the different Iphones - Product mix: The total number of product lines offered by an organisation. At apple, this would mean all the mobile devices, computers, tablets, accessories etc. that they offer as well as B2B products like memory and hardware devices. - Product line length: the number of products available in a product line - Product line depth: The number of variations available within a product line: e.g. pink, gold, black

What are the 3 concepts of market orientation?

1. Customer orientation - concerned with creating superior value by continuously developing and redeveloping offerings to meet customer needs. To do so we must measure customer satisfaction on a continuous basis and train front-line service staff accordingly. 2. Competitor orientation - requires an organisation to develop an understanding of its competitors' short-term strengths and weaknesses and its long-term capabilities and strategies (Slater & Narver, 1994). 3. Interfunctional coordination - requiring all the functions of an organisation to work together to achieve the above foci for long term profit. EXAMPLE: Colgate-Palmolive developed a strong market orientation by aligning their company to the task of promoting trade satisfaction, measuring the number of orders delivered on time and the number of orders completed (Day, 1994). Developing a market orientation within a company is a capability, something that not all firms can do. Organisations that are able to develop a marketing orientation are better at market sensing.

Define what is a Brand and explain different types of Brands

A brand is a name, term, sign, symbol, design or a combination of these, which is used to identify the goods or services of one seller or groups of sellers and to differentiate them from those of competitors (Kotler and Keller, 2006) "A product is something that is made in a factory; a brand is something that is bought by a customer. A product can be copied by a competitor; a brand is unique. A product can be quickly outdated; a successful brand is timeless." (Stephen King, WPP Group) • Brands are products and services that have added value. • This value has been deliberately designed and presented by marketing managers to enhance their offerings with values and associations which are recognised and meaningful to customers Service Brands (Beery, 2000) • Strong brands increase customers trust of the invisible purchase. • Reduce risk of purchasing something that is difficult to evaluate prior to purchase. • The company is the brand. • People are key

What is Business-to-Business price-setting?

Based on the fact that firms sell to other businesses other than firms. Numerous approaches to pricing: • Geographical pricing - pricing based on a customer location (drug prescription at different prices around country) • Negotiated pricing - prices are set according to agreements between buyer and seller e.g. IT installation • Discount pricing - companies reduce the price of an offering on the basis that a customer is prepared to commit either to buying a large volume now or in the future. • Value-in-use pricing - focuses our attention on customer perceptions of the attributes of offerings and away from cost-orientated approaches. What the customer is prepared to pay. • Relationship pricing - seeks to understand customer's needs before pricing the offering in according to those needs in order to generate a long-term relationship e.g. credit or financial terms. Difficulty is that it relies on trust and commitment. • Transfer pricing - occurs in very large organisations where there is considerable internal dealing between different divisions of the company and across national boundaries. Often selling services within the company.

Benefits of STP Process?

Benefits of STP Process: • We create more utility and value (preferred term) for our customers and therefore, usually, we can usually command a higher price and hopefully a higher profit margin • Enhances a company's competitive position by providing direction and focus for marketing strategies, e.g. targeted advertising, new product development and brand differentiation • Ability to examine and identify growth opportunities in the market through the identification of new customers, growth segments or new proposition uses • More effective and efficient matching of company resources to targeted market segments, maximizing the potential return on marketing investment (ROMI) o I.e.. More effective use of resources if we do not have many - using the resources to the best of our abilities. This is like the BCG matrix (boston box matrix) - how we use resources between different markets • Reduce competitive pressure • Helps identify potential gaps in the market • May identify growth opportunities in mature /declining markets (if segment is growing). This can be done by finding the gaps in the market too, e.g. desktop computers aren't used much anymore, but gamers still use it and is a very big market, and they are also used in businesses. So even though the market is declining overall, you can still find segments that need and desire these products.

Why brand?

Brands represent opportunities for both consumers and organizations to buy and sell products and services more easily, more efficiently and relatively quickly. Consumers like brands for following reasons: 1. They assist people to identify their preferred offerings 2. They reduce levels of perceived risk and in doing so improve quality of the shopping experience 3. They help people to gauge the level of product/service/experience quality 4. They reduce the amount of time spent making proposition based decisions, and in turn decrease the time spend shopping 5. Provide psychological reassurance and reward - especially when bought on an occasional basis 6. Inform consumers about the source of an offering

Explain how reference groups influence consumer behaviour

Group Influence Humans as social animals: we belong to groups, try to please others and look at others' behaviour for clues about what we should do in public settings (Solomon et al., 2014, Chapter 10) • Our desire to "fit in" or identify with desirable individuals or groups: primary motivation for many of our consumption behaviours. (Solomon et al., 2014) Reference groups: groups that the individual tends to use as an anchor point for evaluating his/her own beliefs and attitudes (Baines & Finn, 2014) o Reference group (or comparison group): "a group whose presumed perspectives, attitudes or behaviors are used by an individual as the basis of his or her perspectives, attitudes or behaviors." (Arnould et al. 2004: 609) o It may be positive or negative o Basically a group that will influence our behaviour Some marketing messages incorporate the endorsement of celebrities who have influence over the target consumer group Social grade, Lifestyle and Lifecycle: • Social grade: belief that consumers make purchases based on their socio-economic position within society • Marketers also target consumers based on their lifestyles (including attitudes, interests and opinions) • Consumers in similar stages of life tend to purchase and consumer similar products • The idea that the life-style and stage in the lifecycle we are in will influence marketing too. • However, these are rather outdated

What factors affecting price decisions

Internal factors include: • Company's marketing objectives • Marketing mix strategy • Organization structure • Costs External factors include: • The nature of the market and demand • Competition • Other environmental elements - economy, resellers and government

What are the 4 different competitive positioning?

Market leader - Attack the market and defend their position Market challenger - attack the market leader; better pricing and attributes on products Market follower - avoiding hostile attacks on rivals. Copy the market leader and provide good-quality products that are well differentiated. Market niche: provide high levels of specialisation.

Product / Service Classifications

Product/service classifications: how do we separate the two? - The most basic distinction in marketing: Consumer vs Business produts. The difference between the products targeted to individuals or the ones targeted to businesses/organisations. This is because individuals consumer differently to organisations, as seen in CB. **Consumer Products** o Durable vs Non-Durable Goods: • Durable were long-term and expensive (e.g. a house or a washing machine) • Everything that isn't durable: e.g. your phone or food • Services are considered non-durable: e.g. a flight o Can further differentiate between Convenience vs Shopping vs Specialty goods • Convince goods: are the things you buy out of convenience - and is further broken down into impulse goods and emergency goods. You will buy these goods without thinking, e.g. gum, or staple products, e.g. milk. • Shopping goods: you'll spend some time looking at this, looking slightly more carefully, like a phone • Speciality goods: the ones you will search for in great detail, and only buy a few times in your life. You will look very thoroughly at this . o Consumer Services • Hairdressers, doctors, teachers... ** Business Products** o Capital (equipment) goods vs Accessory (equipment) goods • Capital: expensive and big, e.g. machines for a product, and need a lot of capital to buy them • Accessory goods: will also need to produce the product, but they are the ones you need to equip your team (far smaller than capital goods, e.g. hammers). You will buy them more often and they are less expensive. o Raw Materials, Semi-Finished, Maintenance-Repair-Operating Goods, Component (parts) - regarding production itself • Raw materials that go into production - e.g. timber • Semi-finished products, help non-finished • Maintenance-Repair-Operating Goods: things the company needs to maintain production in the firm. E.g. if you have a machine, you will need the oil to keep it going. The oil is the Maintenance-Repair-Operating Goods • Components are just the parts - e.g. the different parts of a car o Business Services • Similar to consumer services but speaks only to business audiences. • The difference is in size and complexity. E.g. even its just a cleaning service, it will require different contracts and different integration

Explain the key characteristics associated with developing promotional messages.

The AIDA model developed by strong is extremely important. Refers to the need to first create attention, second generate interest, then drive desire from which an action emerges. - Generally correct, but fails to provide insight into the depth of how advertising works Hierarchy of effects assumes that a prospect must pass through a series of steps for a purchase to be made. Advertising cannot generate immediate sale as there are a series of thought processes that need to be fulfilled prior to action - Although it is attractive, this sequential approach has several drawbacks - People do not always process information not reflected in reality e.g. impulse buys

Criticisms of segmentation

The limitations of conventional segmentation have been well documented in the literature (Hoek et al. 1996). Perennial criticisms include: • That it is no better than mass marketing at building brands (Addison & O'Donohue, 2001) • It is considered completely irrelevant online. Amazon e.g. is moving from moving from targeting groups to targeting individual products. • That in competitive markets, segments rarely exhibit major differences in the way they use brands - Kennedy & Erhrenberg (2000) • That it fails to identify sufficiently narrow clusters - Bardakci & Whilelcok (2003) • Geographic/demographic segmentation is overly descriptive and lacks sufficient insights into the motivations necessary to drive communications strategy • Difficulties with market dynamics, notably the instability of segments over time and structural change which leads to segment creep and membership migration as individuals move from one segment to another Market segmentation has many critics. But in spite of its limitations, market segmentation remains one of the enduring concepts in marketing and continues to be widely used in practice. One American study, for example, suggested that almost 60 percent of senior executives had used market segmentation in the past two years. (Yankelovich, D., Meer, D. 2006, pp. 122-13)

Define consumer behaviour

The term consumer behaviour can be defined as the behaviour that consumers display in... - searching for - purchasing - using - evaluating and - disposing ...of products, services, experiences and ideas which they expect will satisfy their needs and desires. This suggests that consumer behaviour influences start even before the purchase starts (Tynan & McKennie). We study consumer behaviour in order to understand and predict behaviour in order to design marketing activities and strategies accordingly that will make consumers to come to their brand. This can change consumer behaviour and influence results.

Review how practitioners measure the effectiveness of social media marketing.

To measure the effectiveness of a social media campaign, marketers should follow a 7-step process, which includes: identifying a set of appropriate social media metrics, reviewing the social media campaign objectives;mapping the campaign by highlighting links to brands-generate content, consumer generated content, consumer fortified content, and exposure to content consumers; choosing the criteria and tools of measurement; establishing a benchmark; undertaking the campaign and measuring it frequently.

New Product / Service Development

What are new products? • New to the world products • New product lines (new to the firm) • Additions to existing lines • Improvements and revisions to existing products • Repositioning (New product classification Booz, Allen and Hamilton) Risks in New Product Development • New product development is a high risk activity o Aprox. 90% of new products fail o Only aprox. 40% of new consumer products that are brought to market will be around 5 years later o Industrial markets 35-65% failure rate o Innovation takes time, e.g., biotechnology 10 years • Why? o Doesn't meet customer needs o No Market o Poor communication to the target market

Does marketing practice change if we are marketing goods compared with services, and to consumers compared with businesses?

• Bucklin defined consumer goods as convenience goods or speciality goods. Examples of consumer goods industries include retail car market, luxury goods market and multiple groceries. • The consumer goods perspective has been dominant in the history of marketing. The concept is concerned with ideas of the 'marketing mix' and the 4Ps. • The consumer services perspective, services marketing thinkers suggested that the intangible performance-dependent nature or services substantially affected the way they should be marketed - Business to business vs business to customer: B2B marketing is different to consumer to business because consumer to business is not an individual. B2B marketing requires that marketers deal with more sophisticated customers who are trained to buy professionally. B2B markets are strongly focused on building mutually satisfying relationships based on commitment and trust (Morgan and Hunt, 1994) - to win contract in first place and then to deliver it to customer specifications → B2B marketers can develop a competitive advantage if they develop a strong linkage between the marketing and logistic functions, developing a strong customer service proposition through (Christopher, 1986): - Accurate invoicing procedures - Reliable delivery - Good condition of - goods/effective service delivery - Flexible delivery times

How did the Marketing concept develop?

• How did the marketing concept develop? The idea is that it developed through these sections below that are different time periods, which have all affected marketing. Stage 1 - product orientation: o This step was the idea that if you build a good product, you will have customers come running to your door Stage 2 - Sales orientation: o The door-to-door salesmen area. Sales orientation focused on sales rather than the product, and how the selling was done. o Try to entice customers to buy your product. o The idea was that salesmanship was a form of being a con grew from here. Stage 3 - Market orientation: o The idea that the customers want and need a specific solution to their problems - and actually focusing on this. Technology often drives this.

What is classical conditioning?

Classical conditioning • Classical conditioning occurs when a stimulus that elicits a response (an unconditional stimulus) is paired with another stimulus that initially does not elicit this response on its own. Over time, the second stimulus (the conditioned stimulus) comes to elicit the response as well. (Solomon et al. 2014) o Based on the early work of Ivan Pavlov (1897), who was the first to describe conditioning and to propose a general model of how learning works o For this to work it is necessary to repeat the stimulus a number of times in order for the conditioned response to be become established (Blythe 2008) Marketing: uses messages to make you automatically think of their brand. E.g. Want pizza? --> Dominos. Alternatively, their brands/logo automatically makes you automatically relate to them.

Describe what culture is and explain how it can impact on the use of marketing communications in international environments.

Don't only work on individuals also work on a cultural level: Culture refers to the beliefs, values, ideas, actions and symbols that are learnt by members of particular societies. Marketing communications should be audience centred activity, whether those audiences are located domestically or internationally. - Culture is important as it provides individuals within a society with a sense of identity and an understanding of what is deemed to be acceptable behaviour. - Culture is learnt, the elements are interrelated and culture is shared among members or a group. Advertising and marketing communications are a strong cultural force. Have the potential to influence more than just customers. Can be used by a wide range of other stakeholders. - The tools, media and messages used by organisations influence and are influenced by, the culture and environment in which they operate. Hollensen refers to a nest of cultures, with one inside another, a structure that is similar to a Russian doll. - Imagined here that a buyer in one country and a seller in another are faced with several layers of culture - National - sets out the cultural concepts and legislative framework governing the way the business is undertaken - Industry - particular business sectors adopt a way of doing business within a competitive framework. - Organisational - various sub cultures also have a system of shared values, beliefs and meanings - Individual behaviour - each individual is affected by, and learns from the various cultural levels

Explain the consumer product acquisition process

In the past, people saw the buyer as a 'black box' which was influenced by external stimuli, e.g. marketing stimuli and macro factors. This then passed through the mind - where "something happens" - and they will respond to this, picking a particular product or brand. Today, of course, we know that the process in the mind will influence this process and be crucial to the purchasing and consumption decisions. We may see that there are a lot of different influences on what influences and affects a given purchase. E.g. Initiators, gatekeeper and influencers are people who will all affect the decision process. The consumer proposition acquisition process consists of six distinct stages (which are interactive). The process model is useful because it highlights the importance and distinctiveness of proposition selection and re-evaluation phases in process. • Understanding this is important for marketers so that they can better adjust their offerings to consumers' needs and wants, and communicate them in meaningful ways to consumers. The 6 stages: 1) Motive development: The process begins when we decide that we wish to acquire an offering. This involves the initial recognition that some sort of problem needs solving. To solve the problem, we must first become aware of it. For example, a female consumer decides that she needs to buy a new dress for a party, or she's grown tired of the old one, or she thinks it's out of fashion or to cheer herself up, or for a special occasion, or a whole host of other reasons. 2) Information gathering: In the next stage, consumers look for alternative ways of solving their problems. Our search for a solution may be active, an overt search, or passive. In other words, we are open to ways of solving our problem but we are not actively looking for information to help us. The search for information may be internal, i.e. we consider what we already know about the problem and the products we might buy to solve our problem. Alternatively, it might be external, where we don't know enough about our problem and so we seek advice or supplementary information. ¨ 3) Proposition evaluation: - The consumer evaluates the offerings that he/she identified as potentially capable of solving the problem that initiated the acquisition process. - The criteria to evaluate might be rational (e.g. cost) or more emotionally- driven (e.g. desire) - Evoked set is the specific brands (or models) a consumer considers in making a purchase within a particular product category (Shiffman et al, 2012). 4) Proposition selection: - In most cases, we select the offering we evaluate as fitting our needs/ wants best and that's the one we will acquire. - But sometimes we need to re-evaluate our options (e.g. the house we wanted to rent is no longer available) 5) Acquisition/Purchase: Once selection has taken place, different approaches to proposition acquisition might exist. - For example: our dress buyer may make a routine purchase - a dress for work. A routine purchase is a purchase made regularly. - Because the purchase is regular we do not become involved in the decision-making process. - We simply buy the offering again that we bought previously unless new circumstances arise. The purchase may be specialised, conducted on a one-off or infrequent basis e.g. a ball gown for a ball. - In this case we may become much more involved in the decision making process to ensure that we understand what we are buying and that we are happy that it will satisfy our needs. - For routine purchases, we might use cash or debit cards, whereas for infrequent purchases we might use a credit card. With infrequent purchases, the marketer might ease the pain of payment by offering credit or generous warranties. The lady buying a dress might be intending to purchase the dress, but the store's policy on returns may have an impact on whether or not she actually buys a dress from a particular shop. - Acquisition also differs by channel and the prevalence of any promotional offers. 6) Re-evaluation: What determines whether the consumer is satisfied or dissatisfied with a purchase? - the theory of cognitive dissonance suggests that we are motivated to re-evaluate our beliefs, attitudes, opinions or values if the position we hold on them at one time is not the same as the position we held an earlier period owing to some intervening event, circumstance or action. A person's overall feelings about the product after they buy it affect customer satisfaction/dissatisfaction. • Many factors impact on our satisfaction (e.g. mood, performance, perceived quality) • Evaluation both in terms of utilitarian dimensions (how the product/service functions) and hedonic dimensions (how it makes one feel) Importantly, our degree of satisfaction often depends on the extent to which a product's performance is consistent with our prior expectations of how well it will function.

Understand the role of marketing communications.

Marketing communications is a management process through which an organization attempts to engage with its various audiences, audiences then offer behavioural responses. The marketing communications mix consists of three main elements: 1. Tools • Advertising • Direct Marketing - is the idea that we communicate directly to customers • Public Relations incl. Sponsorship • Sales Promotion • Placements: e.g. product placement • Personal Selling In addition there are several secondary tools such as • Trade Shows and Exhibitions • Sponsorship The 5 primary tools are used in various combinations and with different degrees of intensity to achieve different communication goals with target audiences 2. Digital and Media • Enables messages to be delivered to target audiences. 3. Messages • Planned marketing communications have traditionally used pay-for media to convey messages to target audiences. • However, some messages are best relayed through personal communications • This does not involve any type of payment as it is freely given through word of mouth • Customers use word of mouth as objective and unbiased in comparison with advertising There can obviously be used in combination

Defining the marketing concept

Online definition: Management philosophy according to which a firm's goals can be best achieved through identification and satisfaction of the customers' stated and unstated needs and wants. The marketing concept is a phrase which brings together what marketing does inside a business. Marketing concept is the achievement of corporate goals through meeting and exceeding customer needs and expectations better than the competition. Marketing aims to encompass all 3 aspects in the graph. o Customer orientation: providing customer satisfaction o Goal achievement: satisfying the goals of the company o Integrated effort: creating the effort of these goals throughout the business It is about trying to satisfy the consumers wants and needs while meeting organisational objectives One of the interesting questions about the marketing concepts is about the needs vs. desires/wants.

Illustrate how the use of perceptual maps can assist in the positioning process.

Perceptual mapping: a visual representation of the position our product/service offering and our competitors has in their customer minds. • You try to figure out, graphically, how your consumers relate with your company • You usually try to pinpoint, on the map, where particular segments belong, and where particular brands rank on that map. • Must note: it is the customers thought on the product that is important, not that of the producers. Must work with the customer view. • If you look at your position on the map, and you don't like the position your brand is in, your can aim to Reposition: o Change the tangible attributes and then communicate the new proposition to the same market. You do this in a number of ways, e.g. can change the physical attributes and communicate the new or improved product to the same market. E.g. LYNX is an excellent example of repositioning. o Change the way a product is communicated to the original market. o Change the target market and deliver the same product. o Change both the product (attributes) and the target market.

What is service dominant logic? How does it relate to co-creation?

The relationship marketing concept was concerned with integrating customer service, quality assurance and marketing activity (Payne, 1993) . Today, there is much more focus on the question 'how do we create value?' This is most often referred to as service dominant logic (SDL). This is the idea that most people don't really care about the physical good, but rather care that there simply is a solution to their problem: intangible or not, as long as it's a solution, they will work for it. E.g. AirBnB solves the issue of finding accommodation simply, rather than finding hotels. Service-dominant (S-D) logic is a meta-theoretical framework for explaining value creation, through exchange, among configurations of actors. The underlying idea of S-D logic is that humans apply their competences to benefit others and reciprocally benefit from others' applied competences through service-for-service exchange (Vargo and Lusch, 2004). According to Prahalad and Ramaswamy (2004), organisations should use co-creation to differentiate their offerings, given that the value is tied up inside the customers' experience with the organisation. - The co-creation experience is: joint creation of value, in which customers take part in an active dialogue and co-construct personalized experiences. - Therefore organisations seeking to enhance customer input to co-creation should map supplier and customer processes to identify how to design their services accordingly (Payne et al, 2008). - E.g Boeing airplane manufacturer incorporated feedback from both airline companies and passengers into their Dreamliner plane design before final production.

What is Internal continuous data? What is Internal ad-hod data? What is Environmental scanning?

• Internal continuous data: e.g. coca cola hub. Their role is to listen to real time information in the environment, gather the data and makes a stream of continuous data which the marketing department uses. • Internal ad-hod data: has to do with data that you already have, and bring it up when necessary. • Environmental scanning: external ad-hoc data, used long-term.

Explain the environmental scanning process

'.. the varied information gathering, analysis and dissemination activities that firms pursue in order to keep up-to-date with changes in the market environment.' (Brownlie, 1999). Gathering information from the micro and macro environment. More in depth: Environmental Scanning is the process of gathering information about a company's external events and relationships, in order to assist top management in its decision making and the development of its course of action. - This is the internal communication of external information about issues that may potentially influence an organization's decision making process, focusing on the identification of emerging issues, situations, and potential threats in the external environment - Companies scan the marketing environment in 3 stages: 1) data gathering; 2) environmental interpretation/analysis; 3) strategy formulation - Scanning and understanding the external environment through the PESTLE framework will reveal different influences and trends within different industries and sectors. This can feed into SWOT.

Describe different targeting strategies.

** Evaluating Segment attractiveness - 'DAMP' ** Kotler (1984) suggested that in order for market segmentation to be effective, all segments must be: • Distinct: you should be able to distinguish them from the rest of the market • Accessible: You need to be able to access them easily, or at least access them in some way • Measurable: you should be able to measures them somehow • Profitable: they must be profitable - so it needs to be substantial (have enough people in it to give you a good footing) and that they are willing to pay for your product or service at the price you are charging. How many customers are needed to be profitable is very relative. • Can also determine segmentation on the basis of o Market growth • Segment size • Growth rate • Market potential o Structure/competitive intensity → according to porters 5 forces. • No. of competitors • Ease of entry/exit • Substitutes/alternatives • Power of buyers/suppliers o Company objectives: if the segment that fits your company objectives • Fit with company • Match with resources • Customer familiarity • Channel access • Once you have chosen a good segment, you target a particular part of the market. • Targeting broadly: You could decide to ignore all segments and just treat all of your customers the same: i.e. Mass targeting, as done by e.g. BIC, the stationary company. • Targeting narrowly: Other end of the spectrum You concentrate narrowly on the need of a single group in to market -micro, local or individual targeting, as done by e.g. NIKE where you can customise your own shoe, which is a completely customised product. However, you also communicate with the company in a customised way.

Explain consumer and business-to-business market segmentation.

**Segmentation consumer markets** • The by looking at consumer behaviour, this is how we put people into different groups... o Behavioural: Who, how, where and when? • Purchase • Consumption/usages • Media usage • Technological o Psychological: why and who? • Lifestyle • Attitudes • Motives • Personality o Profile: Who and where? • Demographic • Socioeconomic • Geographic - where are people located? People in Italy will act differently to those in Iceland. • Geo-demographic: basis of segmentation Combination of geographic, demographic (and possibly psychological/ lifestyle & behaviour) o E.g. Households classified by postcodes - E.g. Acorn o Data from a number of sources - E.g. Mosaic UK: "it's how you use multiple sources of data that will help you gain a competitive advantage". • Psychological & lifestyle basis of segmentation (this is the same techniques as CB- finding different groups that behave differently): o Personality - people have different personalities and will therefore prefer different products. Thus it helps up break down people in groups. E.g. people with particular attitudes will want different things → vegans will want special &organic chocolate. • General attitudes, beliefs and values • You use data from market research • One must combine this with behavior for full lifestyle segmentation. Lifestyle is about the activities and interest that they have, and only this. It is expressed by the actual activities, interests and increasing your product choices. • Behavioral data: Segmentation according to purchase behavior o What packaging, units, and how they actually pay (cash, debit/credit card....) o How often does a person consume a certain product, and why do they use and consumer the product? Is it because of a special psychological attachment? o Actual behaviour is a reflection of lifestyle that the person actual has, or which they would like to have. A lot of people live in a way that they can't afford simply because that's who they want to be. **Segmentation of Business** Markets/Customers • In the same way you break down consumers you an also segment organisations and institutions. → just different criteria, but other than this it's the same as consumer segmentation. 1) Firmographic (basically demographic): • Size (Micro, SME, Large) • Age/life cycle (start-up, 1-3 years, 10 years..) • Industry (SIC codes - health, education, ICT...) • Type/role (charity, NGO, Supplier...) 2) Economic: can get this from company records • Revenue/turnover • Profit • Budget - this is particularly important 3) Geographic: • Local • National • Multinational • Global

Explain three models of communication and describe how personal influences can enhance the effectiveness of marketing communication activities.

**The linear model** One interpretation of the linear model is that it is a one-step explanation. Information is directed and shot at prospective audiences, rather like a bullet being propelled from a gun. **The two-way model** However, we know that people can have a significant impact on the communication process and the two-step model reflects their influence. - The model depicts information flowing via various media channels to particular types of people to whom other members of the audience refer to for information and guidance. - Opinion leader - ordinary person with a great interest in a particular topic - Opinion former - involved professionally in the topic of interest - Have have enormous potential to influence, because messages from personal influencers provide reinforcement or may be because this is the only way of reaching the end-user audience. **Interaction model** Similar to the two step model, but it has one important difference. - Parties are seen to interact among themselves and communication flows among all the members in what is regarded as a communication network - Mass media are not the only source of communication - Messages can flow through various channels and that people can influence the direction and impact of a message Personal influencers - opinion leaders, opinion formers • Opinion leaders - opinion leaders have greater exposure to relevant media and as a result have more knowledge and involvement with a certain category of offering than others. Non-leaders turn to these people for advice and information. o Often confident therefore not surprising that many marketing communication strategies and targeted at influencing opinion leaders as they will, in turn, influence others. • Opinion formers - not part of the same peer group as the people they influence. Their defining characteristic is that they exert personal influence because of their profession, authority and education. o They provide information and advice as part of the formal expertise they are perceived to hold. o E.g. shop assistants in music equipment shops

What is a the definition of a market?

- It is a sometimes a place - physical or virtual, a place where buyers and sellers come together and exchange goods and services. However, today, the ideas of a market have expanded. - There is a controversial idea that everything can be sold and has a price - thus everything is marketable. Is this the case? This contains a lot of moral and ethical questions within it. It makes it a very complicated question.

What is price?

- It's not only money. In the old days, we had other types of currency, or exchanged goods. It's about whatever you exchange to have access and consumer the product or service - Can have a lot of names: Fees, charges, fares, tolls, rates, subscriptions etc. ... these are all the same in our books, although they may operate differently. - The amount of money expected, required, or given in payment for something (Baines et al., 2014) - What is the form of payment for a good / service? (One-off, continuous, instalments) o Often you pay once and that's sorted o However, more recently, this could be continuous - like a subscription - or in instalments. - Can price be used to create a competitive advantage? o Yes, but this is something that others can easily copy. So its not the best way of creating a CA - Price is the only element of the marketing mix that produces revenues. - Price is flexible and can be changed much more quickly compared to all other marketing mix elements. - What kind of price do our customers want to pay vs how much does it cost vs how much do our competitors charge... this must be balanced. - What are our pricing objectives? o If you want to maximise profits, you will pick different

Describe the principles of market segmentation and the STP process.

- Segmentation: is a process of identifying segments - i.e. creating groups of individuals or organisations, or even groups of groups, which have similar identifiable needs and common desires and wants, which would mean that they have similar product or service needs. What we try to do with segmentation is to take the market and then break it into smaller pieces, identifying why these groups might want different products between them but very similar products within each group. Each group will be comprised of a set of people that will seek the same kind of product or service offering. We like to address the similarity/ differences between the groups. - Targeting: Comes from segmentation - the conscious decisions to target one or more of the groups you have already identified with the segmentation, in most cases offering different products and services. Particular products for particular groups. - Positioning: the conscious decision for the firm to come up with a particular position that crafts the communication that you need to put out in the market; or the image you want your product do have. It understands how you want to position yourself in the heads of the customers. → Brand or product image. - The reason we do segmentation; even if you have the best product in the world, you will not find that everybody will want to purchase this product at that given price. Also, when a market is crowded, you need to carve out a place to define your product in the market in order to give yourself a competitive advantage in the market. STP helps with this. - However, this was developed long ago, where physical product where much more prevalent. Today, where we have e.g. online services, this makes segmentation rather challenging. - Start with segmentation (gathering info from market research), then you target a segment in the market and create a product or service concept to the target market, communicating your position.

What is strategy?

- Strategy is a means/the path of getting your firm from point A to point B and the different moves/activities you can make to reach this point in order to take your firm to the place it wants to be. - It is generated through people performing actions and writing this down in a document format - Firms organise themselves so that then can make sales, achieve profits, and keep their stakeholders satisfied, this is through strategy. There is a strategic context in which firms operate. These contextual issues can be considered in terms of four main elements: o The organisation (resources and capabilities) o The target customers o Competitors o The external environment For marketing strategy to be developed successfully, it is necessary to understand an organization's strategic context and then fit it to the marketing strategy to match the strategic context. Many organizations articulate their strategic context and their intended performance in the markets they target in terms of a framework that defines their vision, mission, values, organizational goals and organizational strategy.

Understanding the product/service proposition

- We must understand what defines a product. The easiest way to do that is what we describe as the core or augmented product/proposition. - For every good, there is a core benefit in its centre. This is not always easy, but there is always a benefit of the product of service to the clients. E.g. IKEAs core proposition: 'well-designed, affordable and varied home furnishings' (Miller et al. 2006). - The actual/embodied product: the style of the proposition - The augmented product: all the things surrounding the product that adds value to the consumer, e.g. the customer service. Additional activities to the product.

Explain the characteristics of each of the primary tools, media and messages.

1) Communication tools Marketing communications is a management process through which an organization attempts to engage with its various audiences, audiences then offer behavioural responses. The marketing communications mix consists of three main elements: 1. Tools • Advertising • Direct Marketing - is the idea that we communicate directly to customers • Public Relations incl. Sponsorship • Sales Promotion • Placements: e.g. product placement • Personal Selling In addition there are several secondary tools such as • Trade Shows and Exhibitions • Sponsorship The 5 primary tools are used in various combinations and with different degrees of intensity to achieve different communication goals with target audiences 2) Types of media • Enables messages to be delivered to target audiences. 3) Core types of messages • Planned marketing communications have traditionally used pay-for media to convey messages to target audiences. • However, some messages are best relayed through personal communications • This does not involve any type of payment as it is freely given through word of mouth • Customers use word of mouth as objective and unbiased in comparison with advertising These can obviously be used in combination

Explore some of the drivers of consumer decision-making.

1) THE DEGREE OF ACTIVE REASONING: • Certain products you are more involved in than others - less involved in buying a bottle of water than say, a car. • You will be faced by either few or many options • Time pressure will affect your decisions - e.g. buying food on a hungry stomach will affect how much you buy, as hunger makes things will make time seem shorter. 2) A lot of decisions have to do with information: Alternative evaluation is a part of this. What we know from the current research on consumers is that, if we look at ALL alternatives to their problem, from those alternatives there will be different types of information retrieval sets: • Inept set: the products that you are unaware of that are completely foreign to you. You will not even consider these. • A inert set: may have come across of these, and is not on the sphere of your consciousness. • An evoked set - the set of alternatives that WILL come up in your mind o Retrieval set: the set of alternatives in which you consciously retrieve information o Prominent products: the big brand that everybody knows about. 3) The sources of information can also be internal (e.g. from past searches or experience) or external (from personal contacts of marketing messages).

Understanding the Value of a Brand

Branding benefits Firm • Brand Equity (financial contribution, strategic role and brand strength/awareness) • High profits: Enables premium pricing • Branding enables the supplier to attract a loyal and profitable set of customers • Influence consumer perceptions and preferences • Barrier to competition • The supplier's brand name and trademark provide legal protection for unique production features that might otherwise be copied by the opposition • A firm may leverage brand equity with brand extensions • Assists the development of Integrated marketing communications Consumer • Assists people to identify their preferred products • Inform consumers about the source of a product (country or company) • Brand names tell the buyer about the quality of the product • Efficiency of information aids purchase decision. • Reduces the amount of time spent making product based decisions • Reduces purchase risk, monetary, psychological and physical • Helps define personality of consumer • Helps consumers develop relationships based on trust

Understand the principles of trust, commitment, and customer satisfaction, and explain how they are interlinked.

Building and maintaining relationships • For better or worse Customer / Stakeholder - Company relationships are not necessarily that different from human personal relationships... o Trust o Commitment o Satisfaction o Loyalty Essentially relationships minimise perceived risk... • Trust is based on two main dimensions; credibility and benevolence. o Credibility concerns the extent to which one party believes (is confident) that another organization will undertake and complete its agreed roles and tasks. o Benevolence is concerned with goodwill, that the other party will not act opportunistically, even if the conditions for exploitation should arise. • Commitment is important because it implies a desire that a relationship continues and is strengthened because it is of value. Morgan and Hunt (1994) proposed that commitment and trust are the key mediating variables between five antecedents and five outcomes. • A natural outcome from building trust and developing commitment is the establishment of customer satisfaction. • Satisfaction is thought to be positively related to customer retention which in turn leads to an improved return-on-investment and hence profitability. o Many organizations seek to improve levels of customer satisfaction, with the intention of strengthening customer relationships and driving higher levels of retention and loyalty. Ravald and Gronroos (1996) o Satisfaction/Dissatisfaction is a the psychological state (affective/cognitive) following a confirmation/disconfirmation experience (expectations vs. actual experience) o Mention the relationship between satisfaction and Value-in-Use • Post-consumption • Loyalty o Differentiate between convenience/habit o Mention Loyalty programs... Managing trust and reputation, reducing risk and providing high levels of customer satisfaction is now regarded as an expectation that all suppliers need to meet. In addition, organizations attempt to manage their customers using two main approaches: • Customer Contact Centres - many organizations try to help their customers contact them. This can be achieved via a call centre or customer contact centre. • Customer Relationship Management (CRM) - the aim of using these systems is to provide relationships with superior value by enabling suppliers access to real time customer information. This helps suppliers to anticipate and satisfy customers needs effectively, efficiently and in a timely manner.

The Extended Marketing Mix & the 7Ps

By the end of the 1970s it was recognised that the traditional 4Ps approach to marketing planned based on physical products (e.g. CDs, alcoholic drinks) was not particularly useful for either a physical product offering with a strong service component (e.g. laptop computers with extended warranty) or services with little or no physical component (e.g. hardressing, spa and massage) Two American scholars (Booms and Bitner, 1981) incorporated a further 3Ps into the marketing mix to reflect the need to market services differently: 4 - Physical evidence - to emphasize that the tangible components of services were strategically important e.g. a potential uni student requesting a brochure for the uni they potentially want to attend 5 - Process - emphasise improtance of service delivery. When processes are standardized, it is easier to manage customer expectations 6 - People - to emphasise the importance of customer service personnel, sometimes experts and often professionals interacting with the customer. How they interact with customers and how satisfied customers are as a result of their expectations, is of strategic importance. --> More important when looking at service dominant logic

Explain the main characteristics of business markets and understand the different types of organizational customers.

CRM, or Customer Relationship Management is seen by many practitioners as the solution to the implementation of relational strategies. • Operationalization of RM o It's the whole process by which relationships with the customers are built and maintained. (L&W) o "The systems and processes used by an organization to integrate all sources of information about a customer so that the organization can meet individual customers' needs more effectively and efficiently" (Palmer 2011: 210) • When implemented well, CRM systems provide managers with the tools to understand their customers and tailor their service, cross-selling and retention efforts • However, although in line with RM, the focus of CRM is on technology. It is not surprising, therefore, that one of many definitions of CRM is "technology-enabled relationship marketing" • Technology can and does have the potential to make a major impact on the operationalization of RM Customer Relationship Management (CRM) CRM applications were originally developed as sales force support systems and later applications were designed for supplier organizations to enable them to manage their end-user customers. • Data collection and management o A good database will try to capture info from all of the contact points that a customer has with its org: orders received by email, telephone, Intenert enquires, comments, complains, surveys... • Customer analysis and profiling o A clear understanding of the needs of an individual consumer is essential o Profiling is commonly used to analyse the current profitability of individual customers, early signs that a customer is about to defect from the company (eg. Has a bank customer suddently started to used rival bank's ATMs?, maybe the bank needs to take action o Customer profile analysis, loyalty analysis • Computer-aided sales support o Improves the productivity of sales and the quality of sales generated o Sales analysis • Customer information and service Challenges for CRM • Many CRM systems fail to deliver the promised benefits: o Suggestions that ¾ of CRMS fail. Some problems identified are: the rhetoric used by firms, the motives behind customer care and loyalty programmes and the use of mkt techniques considered intrusive or unacceptable • Technology alone cannot produce knowledge sharing and develop relationships o CRM cannot be only a technological solution (tecno fix) but rather an entire change of mindset, in which the organization as a whole becomes customer oriented

Ad-hoc Marketing Research: what are the contents of the Research Brief?

Classical procedure: Writes a brief with contains: • Background summary in brief of what company does, try to achieve • The management problem is included in the brief • The marketing research questions - translates the management problem into a set of questions which could be answered by research • Tell their clients what they think the intended scope of the research is (survey or experiment etc) • Tendering procedures - consistent procedure that business to business relationships have, each gives different answer on the price they will achieve with research proposed

Consumer buying behavior: Rational or Emotional?

Consumers' decisions are not purely "rational"! • Consumers were traditionally thought to act rationally, making decisions based on a 'cost-benefit analysis' of price and product scarcity/ availability • However, this rational perspective and the information processing model associated with this perspective are not always useful in understanding consumer decisions. • Consumers do not necessarily decide in order to get the best quality at the best prices. They often buy for "feelings, fantasies and fun" rather than functionality or "rational utility" (Holbrook and Hirschman, 1982; Hirschman and Holbrook, 1982). Hedonic and experiential consumption: • Consumer behaviour is "far more sensory complex, imaginative and emotion laden than it has been reflected in the traditional approach to marketing research" (Hirschman and Holbrook, 1982: 100). • Hedonic consumption as those facets of consumer behavior that relate to the "multi-sensory, fantasy and emotive" aspects of the consumer's experience with products (Hirschman and Holbrook, 1982: 92). • Consumption as a means of seeking fun, fantasy arousal, sensory stimulation and enjoyment (e.g. Havlena & Holbrook, 1986). • Consumers may value these regardless of the goods' instrumental value (e.g. Holbrook 2006).

Discuss crowdsourcing and explain how online communities can be harnessed for marketing purposes

Crowdsourcing is the process of outsourcing a task or group of tasks to a generally large community (crowd) of people. It can be used in marketing to outsource routine activities, to obtain content, or to obtain creative input. It can also be used as a way in which to gain access to financial resources.

Appreciate the nature of perceived value, and describe the differences between the transactional and the relationship approach to marketing.

Customer experience marketing is built on an understanding of customer value, a knowledge of services and some aspects of relationship marketing. Goals of delivering positive and memorable customer experience are to drive up customer service and enable customers to associate great experiences with a particular brand. In business, customer experience can be very simply defined as: 'How a customer feels about a company over time.' (Greenberg). All of the events experienced by customers before and after a purchase contribute to their customer experience. How can we define the customer perceived value of a product/service offering? • Customers buy offerings (products and services) for the benefits and/or solutions that arise from using them, not purely for their features - these benefits and solutions represent value for customers and are the main reason why one offering is selected in preferences to another • Value is the customer's overall assessment of what they give assessed against what they receive, i.e. value is the customer's estimate of the extent to which a product or service can satisfy their needs. • Customers determine a product's value by considering alternative solutions and the costs associated with satisfying their need. Therefore, value is relative to a customer's needs, expectations and experience of competitive offerings within a category. • Kothandaraman and Wilson (2001) argue that the creation of value is dependent on an organization's ability to deliver high performance on the benefits that are important to the customer. Relationships are critical to creating value. Above all else, it is the relationships between buyers and sellers that are considered to represent real value if only because it is longer lasting and difficult for competitors to copy or destroy (Simpson et al, 2001) • Value-to-Customers / Value-in-Use o Focuses on net value customers realize from using the offerings provided by suppliers • Value-of-Customers o Focuses of net value derived by suppliers from their customers

List the characteristics and differences between market segmentation and product differentiation.

Differentiating your product from those of your competitors and segmenting a market can help you increase sales by creating a unique selling proposition. You can segment a market with product differentiation by making different versions of the same product. This helps you appeal to customers with different needs. You can also segment the market using different marketing messages. MARKET SEGMENTATION PROCESS: • The origins of segmentation theory are attributed to Smith (1956) o The principle assumption is that customers are too numerous and varied (heterogeneous) in their product needs and buying requirements to be satisfied by a single offering... but they can be grouped on the basis of similar needs and buying behaviour in order to provide a more homogeneous response to marketing programmes (Choffray and Lilien, 1980) Because consumers have different needs, even when shopping for the same product, it's important to know who is buying your product. This will help you plan your marketing, product development and pricing. You can sell a higher-priced version of your product with extra features in specialty stores to attract young, affluent singles, and sell another version with fewer features at a lower cost to young families or seniors. You can sell one version of your product to consumers, and another to businesses. PRODUCT DIFFERENTIATION A small business can differentiate its product using marketing techniques, by physically changing the product or by changing the price. Using marketing, you can create a brand or image in the mind of consumers by pointing out the difference between your product and those of your competitors. For example, your advertising can show that while your product may cost the same as your competitor's, it lasts longer, making it less expensive to use. If you sell tennis shoes, you can reinforce the toes, making it a longer-lasting shoe that appeals to frequent players who wear out their shoes. Lowering or raising the price of a product differentiates you from your competition.

Explain the factors that influence the design and structure of marketing channels

Distribution channels can be structured in a number of ways. Three main outlines involving producers, intermediaries and customers • Direct - involves selling directly to end-user customers with little involvement from other organizations • Indirect - uses intermediaries • Multinational - combines both In direct channels, the producer uses strategies to reach end-users directly rather than dealing through an intermediary e.g. local farmers market - Not suitable for all propositions, suitable to those who require customization or technical commitment. - Internet is enabling more and differing product manufactures to reach customers directly + Advantages: o The producer and manufacturer maintaining control over offering and profitability- strong customer relationships - Disadvantages: o the large amount of capital and resources required to reach customers. o No economies of scale o Manufacturers suffer from low variety of offerings, might not meet need of buyers Indirect channels enable producers to concentrate on skills and processes necessary to make offerings, use one of more intermediaries for distribution. E.g. Procter and Gamble Multichannel structure where the producer controls some marketing channels and intermediaries control others. E.g. airlines sell tickets directly, but also rely on travel agents + Advantages: o Increased reach - using direct and intermediaries wider target audience can be reached o Producer control - producers have greater control over prices and communication when reach customer directly o Optimized margins - producers can improve margins from the direct channel element, and increase their bargaining power as they become less dependent on intermediaries o Improved market insight - developing relations with direct customers, can have better insight on needs and wants - Disadvantages: o The sharing of profits among channel members can be a source of conflict o May confuse customers on which channel they should use

Define what is a Product / Service

What is a product/service proposition? - These is a product and service continuum - from pure good (material goods that is tangible/physical) to pure services (intangible - e.g. airlines flights - where the are tangible elements but the experience of the flight cannot be touched). - In reality, however, most products are a combination of goods and services. Physical goods are combined with services in order to provide value and create solutions.

Explain the term 'customer experiences', how it has evolved, and how it might be measured.

Four main phases within customer relationship lifecycle: customer acquisition, development and retention, and decline (termination). Customers have different requirements as a relationship evolves. These requirements are reflected in the intensity of the relationship held and the level of intensity will vary through time. 1. Acquisition phase - buyers and sellers search for suitable match; settling in period during which both parties seek out information about the other before any transaction occurs; initial transaction followed by review 2. Development phase - sellers encourage buyers to purchase increased quantities, try other products, engage with other added-value services etc. This phase is critical to developing understanding between sellers and buyers 3. Retention phase - characterized by greater relationship stability and certainty, allowing more cross-buying and product experimentation (often involves loyalty schemes) 4. Decline phase - relationships become destabilized and termination becomes a serious problem

Analyse an organization's product/service portfolio to aid resource planning

If I have many products, which ones should I focus on? When managing a collection or portfolio of offerings, we should appreciate that understanding the performance of an individual offering can often fail to give the appropriate insight. What is really important is an understanding of the relative performance of offerings. By creating a balance of old, mature, established, growing, and very new offerings, there is a better chance of delivering profits now and at some point in the future, when the current offerings cease to be attractive and profitable. We use portfolio analysis, specifically the 8 Box approach to determine whether different strategic business units or product/service formulations are stars, dogs, question marks or cash flows; each category suggests differing levels of cash flow and resource requirements to develop. It is important to undertake a marketing audit as a preliminary measure to allow proper development of marketing strategy. Portfolio Issues • How fast will the market grow? • What will be our market share? • What investment will be required? • How can a balanced portfolio be created from this point?

Explain how digital marketing is evolving from Web 1.0 to Web 3.0.

In the beginning of the internet, the marketing focus for Web 1.0 was the creation of static websites for branded content and information sharing. - Web 2.0 was then characterised by greater audience engagement and an interactivity between the website and the user. - This facilitated the development of user-generated content, the co-creation of content and brand communities where like-minded users meet to network and socialise online. - Web 3.0 will be characterized by the web becoming artificially intelligent, thereby recognizing links and relationships between data sources, allowing the prediction of audience response and greater targeting.

Explain the different types of intermediaries and their roles in the marketing channel

Intermediaries reduce exchange complexity: i.e. the complexity the channels would face without intermediaries. They simplify so the producers do not have to deal with everybody in the market. The marketing channels enable different types of uncertainty to be lowered in several ways. By reducing uncertainty, experienced by all members in a channel, each member is in a better position to concentrate on the other tasks. **Types of intermediaries** • Agents or brokers - find customers and facilitate sales, without taking ownership of the offering • Merchants - undertakes the same actions as the agent, but takes ownership of the product • Distributors or dealers - distribute the product, e.g. car dealers. Usually have an exclusive contract with a particular manufacturer. • Franchises - holds a contract to supply and market an offering to the requirements of the owner of the original offering. E.g. post-offices • Wholesalers - stocks the goods before the next level of distribution. They are the step between manufacturers and retailers. • Retailers - sell directly to consumers. E.g. Walmart, Marks and Spencer →May not only use one, may use more than one. Have issues if there is dual-distribution. Benefits from using intermediaries: - E.g. Burden sharing, cost and time saving: Intermediaries may share many manufacturer responsibilities such as taking care of storage, stock management, setting up sales offices in strategic locations and add-on services (and their associated costs). They also share costs incurred in promotion of products and offer financial programs such as easy payments to customers. Intermediaries operate at much lower costs than manufacturers who try to manage the entire process. Delivery time is also saved because of the expertise and experience of intermediaries.

Discuss key techniques in digital marketing and social media marketing.

Internet advertising - important source of online consumer information, especially as number of internet user's increases. Form of marketing communication that uses internet-based resources for the purpose of advertising, delivering messages to drive traffic to a website and also to encourage trial, purchase. Search marketing - search directory and search engine to help users locate information • Search engine marketing o Search engine optimization o Paid search (pay-per-click) marketing Email marketing - highly cost effective. Market by email, which the recipient of the message consents to receive. Only sends to person who has accepted to receive. Opposite to spam. Viral marketing - people communicate, often stimulating content to their peers. Social web marketing - form of marketing that describes the use of the social web and social media for marketing activities. Marketers are increasingly investing in social networks to increases the social capital of their brands Advergaming - in game advertising often coupled with sales promotions that provide rewards in terms of incentives and novel and fun entertainment. Use computer and video games to deliver advertising. Mobile marketing - on the move. The set of practices that enables organizations to communicated and engage interactively with their audiences through any mobile device or network. Social medial landscape 2016

SWOT - explain what is is and how it's integral to the internal analysis of a firm.

It is a means of getting to know the firm, a business unit/department, a product...the analysis can be adjusted, but it is simply an environmental and internal analysis. Strengths: What do we do well (relative to competitors)? Weaknesses: Where do we fall short? These are exeternal and directly related to the actions and activities you are trying to implement. - Opportunities: How can we take advantage of our strengths? - Threats: What do we need to be wary of given our shortcomings? Both of these can be very objective. Not everybody may think something is a threat, and not all may find something to be an opportunity. Opportunities - linked to strengths o New technology o Economic expansion o Deregulation o Social change Threats - linked to weaknesse o New regulation o New technology o Economic recession o New competition o New entrants SWOT strategic Implications and response: - Must exploit strengths to exploit your opportunities - If there is an opportunity but you are weak, you must build this area first to take advantage of this opportunity. - if you're strong but see a threat on the horizon, you can use the existing strengths to counter the threats - If you are weak in an area and see a threat coming, you must build a new strength to counter the threats Try to covert all weaknesses to strengths and all threats to opportunities.

Understand how to build a brand

Keller´s pyramid is a classic in marketing, and a simple way to present your ideas to the client. It answers four questions: Who are you? First level is brand salience. In building a highly salient brand it is important that awareness campaigns not only build depth (ensuring that a brand will be remembered and the ease with which it is) but also breadth (the range of situations in which the brand comes to mind as something that should be purchased or used). What are you? The second layer of the pyramid deals with giving meaning to the brand trough two building blocks: brand performance and brand imagery. Brand performance is the way the product or service attempts to meet the consumer's functional needs. Brand imagery deals with the way in which the brand attempts to meet customers' psychological and social needs. What about you (responses)? In the third tier of the pyramid you develop a consumer response to the brand. Keller proposes two building blocks for this tier, namely brand judgments and brand feelings. What about you and me? The final tier of is called brand resonance. Resonance is characterized by the intensity of the psychological bond that customers have with the brand and their level of engagement with the brand. Critical Success Factors (Cooper, 1999) • Quality of market research- orientation of the new product development process to the needs of the market • Market attractiveness o Market knowledge, customer needs analysis • Product advantage-differentiated product with unique customer benefits - competitive advantage • Early product definition- target market, concept, benefits & positioning • Product/service advantage o Unique or superior value created for customers

Marketing Research and Ethics: what are the rules?

Marketing research should be carried out in an objective, unobtrusive, and honest manner. Researchers are also concerned about the public's increasing unwillingness to participate in marketing research and the problem of recruiting suitable interviewers. Marketing research is increasingly conducted online, creating its own set of ethical concerns. The MRS key principles outline that researchers shall (MRS, 2010): 1. Ensure that participation in their activities is based on voluntary informed consent. 2. Be straightforward and honest in all their professional and business relationships. 3. Be transparent as to the subject and purpose of data collection. 4. Respect the confidentiality of information collected in their professional activities. 5. Respect the rights and well-being of all individuals. 6. Ensure that their respondents are not harmed or adversely affected by their professional activities. 7. Balance the needs of individuals, clients, and their professional activities. 8. Exercise independent professional judgment in the design, conduct, and reporting of their professional activities. 9. Ensure that their professional activities are conducted by persons with appropriate training, qualifications, and experience. 10. Protect the reputation and integrity of the profession. The MRS code of conduct, based on the ESOMAR Code, is binding on all members of the MRS. Members of the general public are entitled to assurances that no information collected in a research survey will be used to identify them, or be disclosed to a third party without their consent.

New Product Adoption

New product adoption and diffusion - Swann (2008) • Diffusion seeks to understand the rate at which consumers take up innovation. • For the rate at which an innovation diffuses will depend on the factors that influence individual consumption decisions and the rate at which these change over time. • Whether a product or process, it may take a long time for an innovation to diffuse across users/consumers • For several reasons, projecting how the market for a new technology will grow is one of the most difficult questions in economics: o It is customary to assume that tomorrow's markets are just more developed versions of todays, however this is not the case. o We often fail to recognise how 'path dependent' the evolution of demand for a new technology is (i.e. the events in the past that affect it all) o Demand projections will depend on the evolution of the technology, but also its rivals, and the latter is not easy to foresee.

What is Operant Conditioning?

Operant conditioning • The psychologist B. F. Skinner (1938) argued that learning was the result of operant conditioning whereby subjects would act on a stimulus from the environment. The resulting behaviour was more likely to occur if the behaviour was reinforced. • Operant (instrumental) conditioning occurs as the person learns to perform behaviours that produce positive outcomes and avoid those that result in negative outcomes. • This learning approach recognizes that learning can be encouraged and even reinforced through the use of positive and negative reinforcers. • E.g. shops reinforce our loyalty by providing reward and points cards (positive reinforcement)

Describe opinions, attitudes, and values and how they relate to consumer behaviour

Opinions, Attitudes and Values (Baines & Fill (2014: p. 61)) • Opinions - Tend to be cognitive (i.e. based on thoughts) and can be described as the quick responses we might give to opinion poll questions about current issues or instant responses to questions from friends. They are typically held with limited conviction partly because we have often not yet formed or fully developed an underlying attitude on this issue or item. • Attitudes - held with a greater degree of conviction, over a longer duration, and are more likely to influence behaviour. They are affective (linked to our emotional states) Honda: changing attitudes in Kotler et al. • Values - held even more strongly than attitudes and underpin our attitudinal and behavioural systems. Values are linked to our conscience, developed through the family socialization process, and culture and are frequently formed in early childhood. They are conative (linked to our motivations and behaviour)

Describe the different activities associated with managing and planning marketing communications

Organisations use a variety of tools, media and messages to engage their audiences. There are referred to as the marketing communications mix - a set of five key criteria, a variety of media and messages that can be used in various combinations, and different degrees of intensity, to communicate successfully with target audiences. The 5 key criteria: - The degree of control over a message - The credibility of the message conveyed - The costs of using a tool - The degree to which a target audience is dispersed - The task that marketing communications is required to accomplish • The expansion of media is referred to as media fragmentation. People have developed a whole host of new ways of spending their leisure time, no longer restricted to few media. • A key challenge is to find the right mix of tools, media and messages allows them to reach their audiences efficiently and effectively.

Describe the role and configuration of the marketing communications mix.

Organisations use a variety of tools, media and messages to engage their audiences. There are referred to as the marketing communications mix - a set of tools, a variety of media and messages that can be used in various combinations, and different degrees of intensity, to communicate successfully with target audiences. 1) Communication tools 2) Types of media 3) Core types of messages • The expansion of media is referred to as media fragmentation. People have developed a whole host of new ways of spending their leisure time, no longer restricted to few media. • A key challenge is to find the right mix of tools, media and messages allows them to reach their audiences efficiently and effectively.

Consider the principles and issues associated with integrated marketing communications (IMC).

Rather than use advertising, PR, sales promotions, personal selling, and direct marketing separately, IMC is concerned with working with these tools (and media) as a coordinated whole. Hence, organisations often use advertising to create awareness, then involve PR to provoke media comment, and sales promotion to create, trial, and then reinforce these messages through direct marketing or personal selling to persuade audiences. The internet can also be incorporates to encourage comment, interest and involvement in a brand, yet still convey the same message. Mobile communications are used to reach audiences to reinforce messages and persuade audiences to behave in a particular ways, where they are.

Outline the principles and economics of customer retention and consider the merits of loyalty programmes.

Relationship marketing is based on the premise that retained customers are more profitable than transactional marketing-based customers. Loyalty is an important concept within relationship marketing and the loyalty ladder model illustrates the critical point that different customers represent different value to organisations. This suggests that there are many different forms of loyalty and that different marketing strategies are required to reach each of them.

Describe what is meant by the term service processes, 'service encounters', and the principles associated with measuring service quality.

Service (Processes) Services are considered to be processes and a process is a series of sequential actions that lead to predetermined outcomes, e.g. a simple process might be the steps necessary to visit a dentist, whereas a complex process might be the actions necessary to manage passengers on a cruise. Service (singular) is a process—distinct from "services" which are a particular types of goods o Processes are directly related to two variables: first, the intensity of the equipment used to deliver a service, and second, the intensity of people involved in the provision of the service. **Service encounter** Occurs when a consumer and a producer meet in order for the former to receive the benefits that the latter has to offer • "A period of time during which a consumer directly interacts with a service" (Shostack 1985: 243) • It involves "all aspects of the service firm with which the consumer may interact - including its personnel, its physical facilities and other tangible elements - during a given period of time" (Bitner 1990: 70). • Customer interactions may be short and encompass all the actions necessary to complete the service transaction... or may be longer, involve several encounters, several representatives of the service provider (and possibly several locations) (THERE IS A LOT MORE TO THIS)

What are the steps in environmental analysis?

Steps in Environmental Analysis 1. Assess the nature of the environment 2. Review environmental influences (PEST) 3. Identify key competitive forces (5 Forces) (Covered in lecture 2) 4. Identify competitive position (strengths and weaknesses) 5. Identify key opportunities and threats Once you have all of this information, you can determine your strategic position - and if you can make it from point A to point B, or what you need to do to go from A to B. Leads to understanding your STRATEGIC POSITION SWOT analysis is used to determine an organization's strategic position. It highlights the need for a strategy to produce a strong fit between the internal capability and the external situation. SWOT helps to sort through the information generated in the review, to identify the key issues, and prompts thought about converting weaknesses in to strengths and threats into opportunities.

Describe the concepts associated with strategic marketing action, and explain the ways in which firms engage strategically with their chosen markets

Strategic Marketing Action is essentially about Competitive Level Strategy, Sustainable Competitive Advantage, Competitive Positioning, Strategic Intent Who are our competitors? Very important to know this...depending on this, this defines the market you operate in, which in turn affects your actions (like SCP). Defining the competitors can be difficult... o E.g. for a restaurant, competitors could include: a restaurant next door, a restaurant in another area, supermarket ready meals, pubs and theatres, domestic kitchen equipment suppliers. Thus, it is about creating a competitive advantage. Competitive advantage is the prolonged benefit of implementing some unique value-creating strategy not simultaneously being implemented by any current or potential competitors along with the ability to duplicate the benefits of this strategy. Porter (1980) argues that successful companies chose and stick to one of these generic strategies to gain CA and compete with other businesses: - Cost leadership: has to do with minimising the production costs. Does not mean lower price, just lower operation costs, although lower prices are often used to attract customers e.g. (budget airlines) - Focus strategies: are used by organisation so seek gaps in broad market segments or in competitor's ranges. The more you focus on a a product, the better. - Differentiation strategy: requires that all value chain activities are geared to the creation of offerings that are valued by and satisfy the needs of particular broad segments. E.g. Apple The issue with these strategies is that they are hard to 'do at the same time'.

What is strong and weak theory of advertising?

Strong and weak theories So if advertising cannot be assumed to work in just one particular way other theories exist. - Strong theory = Jones (1991) - Weak theory = Ehrenberg (1997) Strong theory advertising is believed to be capable of increasing sales for a brand and for the product class. - Achieved through use of manipulation and psychological techniques - This interpretation is a persuasion view and corresponds well to the hierarchy models. Persuasion occurs by moving buyers towards a purchase through steps Weak theory advertising is employed as a defence, to retain customers, and to increase brand usage. - Has little effect on persuading consumers as consumers are active not passive. Both the strong and weak theories are equally important. The answer of how does advertising work, lies in between the two.

Explain breifly supply chain management

Supply Chain Management (SCM) refers to the management of the flow of products from a manufacturer to a customer or end consumer of your product or service. SCM involves: o Activities associated with the movement and storage of products and materials from suppliers to a factory (inbound distribution). o Activities associated with the movement and storage of products from a factory to customers (outbound distribution) • The primary SCM activities are fulfilment, delivery and transportation, warehousing and stock management. • It is argued that SCM seeks to accomplish four main goals, waste reduction, time compression, flexible response and unit cost reduction. • By achieving these the efficiency of the supply chain is improved, and as a result, end customers can experience improved levels of channel performance.

What is a sustainable competitive advantage?

Sustainable Competitive Advantage • In terms or marketing management its different. Value is the basis of what our products and services hold. How do we define Value (in Marketing terms)? - We define value as the value in use, i.e. what the customer gets as value out of the product. E.g. in the term in terms of emotion, structure, usage of product...the value of the product by experiencing the product. Must consider both hedonic and utilitarian benefits. • How do we communicate Value? - in the form of a USP - and what drives value out of the product. It is communicated through communication.

Analyse the performance environment using the Porter's Five Forces industry analysis model

The Performance Environment, sometimes called the microenvironment, consists of those organizations that either directly or indirectly influence an organization's operational performance. Analysis of the performance environment is undertaken so that organizations can adapt to better positions, relative to those of their stakeholders and competitors. These adjustments are made as circumstances develop and/or in anticipation of environmental and performance conditions. The performance environment encompasses not only competitors but also suppliers and other organizations such as distributors, who all contribute to the industry value chain. There are three main types: • Those companies that compete against the organization in the pursuit of its objectives. • Those companies that supply raw materials, goods, and services and those that add value as distributors, dealers, and retailers, further down the marketing channel. • Those companies that have the potential to indirectly influence the performance of the organization in the pursuit of its objectives. These organizations often supply services such as consultancy, financial services, or marketing research or communication agencies. Analysing Industries - use Porter's 5 forces to analyse 1) New Entrants: Companies enter and leave their industries all the time. When examining an industry, one must consider whether economies of scale are required for successful performance 2) Substitutes: When analysing the company's place in the industry, one must consider what alternative offerings exit in the marketplace in order to meet the customers' needs 3) Buyers: A company should understand the bargaining power that buyers have with their suppliers; this can impact on the price charged and the volumes sold or total revenue earned 4) Suppliers: An industry analysis should determine how suppliers operate and the extent of their bargaining power 5) Competitors: Companies must understand how their particular industry and market operate. This is so they can forecast and strategize for the future

Defining market orientation further

The concept of market orientation lies at the heart of marketing. Developing a market orientation is argued to make organisations more profitable, especially when there is limited competition, unchanging customer wants and needs, fast-paced technological change, and strong economies in operation. --> In a meta-analysis of market orientation studies there is a conclusion that market orientation may be imperative for survival in service firms and the source of competitive advantage in manufacturing firms. Doesn't just involve marketing, involves gathering and responding to market intelligence (i.e. customers' verbalized needs and preferences from data collected from surveys, sales data, websites, social networking sites) Market orientation is an organisation state of mind. It happens when: - The firm is outward facing - The firm knows and nurtures its customers - The firm totally understands the value of its brand and products - The firm understands the competition and where the market is going (or drives the market) - The firm knows its limits

Explain PESTLE analysis and show how it is used to understand the external environment

The external environment is characterized in two main ways. In the first, the elements do not have an immediate impact on the performance of an organization, although they might do in the longer time. In the second, although the elements can influence an organization, it is not possible to control them. This suggests that the level of risk attached to the external environment is potentially high. To make sense of the external environment, we use the well-known PESTLE. Considers factors affecting the business and/or its markets. These factors are NOT controlled by the firm. • Political • Economic • Social • Technological • Ecological • Legal *Political*: political changes or trends in government policy (nationally and internationally), regional bodies, influences on the political agenda etc. *Economic*: change driven by the economy (economic growth or recession, supplies of resources and materials, prices, competitors etc). *Social*: changes in socio-cultural factors (demographics, lifestyles, attitudes and beliefs, religion, social norms etc). *Technological*: change due to technological development (new technologies, rate of obsolescence, across markets etc). Often specific to a particular market and depends on rate of innovation. *Ecological*: influence of environmental change (global warming) or ecological concerns (e.g. fish stocks, oil reserves). Often linked to political and legal changes. *Legal*: change caused by new or planned laws, international differences, legal difficulties (e.g. e-commerce) etc.

Theories of motivation: Explain Theory of planned behaviour

What provides our motivations is not only our desires and needs, but also our values and beliefs. This is what the theory states. The theory of planned behaviour explains that behaviour is brought about by our intention to act in a certain way. - This intention to act is affected by the attitude a subject has towards a particular behaviour, about the degree to which a person has favourable or unfavourable evaluations of the behaviour in question. - Intention to act is also affected by the subjective norm, which is perceived social pressure to perform or not to perform a certain behaviour - Intention is also affected by perceived behavioural control, referring to the perceived ease or difficulty of performing the behaviour, based on a reflection on past experience and future obstacles

Understand the main issues associated with strategy implementation, including the principles of marketing metrics

The implementation of most strategic marketing plans involves some main issues. These are: - The structure and type of marketing function and the degree to which a marketing orientation prevails across the organization - The amount of financial resources and how they are distributed and managed through budgets - The controls used to measure the effectiveness of the implementation process. These are referred to as marketing metrics. 1) In order to implement the strategies, organisational structures is very important: • Functional organisations - old fashioned and hierarchical. (U-form) • Product management organisations - layer organisation according to product, e.g. part takes care of pet food, another part of human food, another of beverages etc. • Market management organisations - focuses on single products to different markets, e.g. selling pepsi to restaurants, selling to shops, selling to hotels, etc.. • Matrix organisations - having cross-sectional approach where different strategic business units work together. 2) Implementation: how to I measure my performance in relation to the path that the company has opted to take? How is performance measured? Some examples: • Financial vs. non-financial • Current vs. projected future performance • Comparisons with competition Many companies now use now use various marketing metrics (are KPI's) to monitor performance. These include metrics in the following areas: profitability, sales, value and volume, gross margin, awareness, market share, number of products, relative price, number of customers complaints, costumer satisfaction, availability, total number of customers, marketing spent, perceived quality/esteem, loyalty ´/retention, and relative perceived quality.

Describe the nature and characteristics of a marketing channel

The importance of distribution management decisions • It affects all the other marketing mix decisions - can't support the other elements in the marketing mix without an appropriate distribution strategy • Distribution decisions tend to involve the firm in relatively long-term commitments to other firms, it is often e decision to work with other companies, and are central to many corporate strategies and are always long term • Distribution channel agreements prevent you from using other distributors so need to get it right Marketing channel management = distribution channel managements: how do we manage the paths to our customers? Marketing channel management requires the balancing of three main elements: • Economics, i.e. the management of resources/costs in order to achieve the targeted return on investment - sending your product through a particular channel. • Coverage is about optimizing the exposure to customers, availability and access by customers to the proposition by a particular channel. The best channels have the best exposure. • Control refers to achieving the optimum channel performance by balancing decisions about all aspects of the mix, within targeted channel costs and sales goals. The more people in the distribution chain the less control we have over all of them. Will have different distribution needs depending on what type of stage we are on the product life cycle. Functions of the marketing channel - useful functions are the reasons we have them as they can be expensive. • Logistical (organization and planning) (all the trucks which run around and bring things to people) o Product assortment (supermarkets, car dealers) → use to give them variety o Sorting (standardisation of fruits, vegetables in supermarket) o Bulk breaking - break down large quantities - reconfigure and sell as assortments o Biggest problem is the last mile problem, if the person is not home; it is costly. Looking at times to utilise their distribution expertise to deliver more than just the goods Transactional (relating to the conduction of business, especially buying or selling) o Risk (WallMart and P&G) - often have risk, use intermediaries to take ownership, so we do not carry all the risk. P&G use WallMart, P&G get paid sooner as sell to WallMart o Marketing (supermarkets carrying out POS promotion) e.g. loyalty cards Facilitation o Financing (e.g. store credit cards) → buy a car, could bring out a big bunch of cash and ask for discount. Say discount if have financing card; pay back in 12 months → finance company never heard of lend you money, you pay them back. Functions of a marketing channel can often be through logistics, transactions and facilitating.

Marketing Information Systems and the insight process - Jobber (2007)

The marketing information system is an old term for something that these days is not present in a lot of companies. Before the internet days, there was this idea of the marketing information system, where you information from your marketing environment, and then transform that information in one way or another and then use that information to make particular types of decisions-making. - Just means the system of transferring information Marketing information should be used for timely and continuous information to support decision-making. The kind of information marketers needs includes (Ashill and Jobber, 2001): - Aggregated marketing information in quarterly annual summaries; - Aggregated marketing information around offerings/markets (e.g. sales data) - Analytical information for decision models (e.g. SWOT, segmentation analyses) - Internally focused marketing information (e.g. sales, costs, marketing performance indicators) - Externally focused marketing information (e.g. macro and industry trends) - Historical information (profitability, trends) - Future-oriented marketing information (e.g. costs, profit, market shares, net promoter score) - Qualitative marketing information (e.g. buyer behaviour, competitor strategy information) - Qualitative marketing information The above information could be provided on a continuous and/or an ad hoc basis. Continuous industry trend information is collected from industry reports and secondary data sources. However, the market research manager should remember to buy the reports and input the data into a marketing information system. Other information may be obtained on an ad hoc basis by commissioning specialist market research projects.

Outline the key elements of a marketing plan

The marketing plan is essentially a road map of your plans. A marketing plan is a business document outlining your marketing strategy and tactics. It's often focused on a specific period of time (i.e. over the next 12 months) and covers a variety of marketing-related details, such as costs, goals, and action steps. The key elements associated with the structure of a marketing plan are overall objectives, product/market background, market analysis, marketing strategy and goals, marketing programmes, implementation, evaluation, and control. Although depicted as a linear process, many organisations either do not follow the process, do not include all these elements, or undertake many of these elements simultaneously. But like your business plan, a marketing plan is not a static document. It needs to change and evolve as your business grows, and as new and changing marketing trends develop

Explain the processes involved in human perception

The process by which physical sensations (stimuli) such as sights, sounds and smells are selected, organized and interpreted. The eventual interpretation of a stimulus allows it to be assigned meaning (Solomon et al. 2014) • "Based on prior attitudes, beliefs, needs, stimulus factors, and situational determinants, individuals perceive objects, events, or people in the world about them. Perception is the cognitive impression that is formed of 'reality'" which in turn influences one's behaviour (AMA, 2013 in Baines & Fill, 2014) This also means we are subject to perceptual biases too. We are not objective observers... Perceptual selection means that people attend to only a small portion of the stimuli they are exposed to - marketers have to work especially hard to attract the customers' attention (Kotler et al, 2013) • The process of screening meaningful information from the non-meaningful is known as selective exposure (Dubois, 2000). We selectively perceive the information. This is necessary to be functional - it is a process of screening information. Our minds would become overloaded with information otherwise. E.g. young people are not usually interested in advertising messages for financial services such as pensions (Baines & Fill, 2014). As a result of selective exposure, we suffer from CONFIRMATION BIAS.

Explain the different types of strategic marketing goals and associated growth strategies

The purpose of strategic marketing analysis is to help managers understand the nature of the industry, the way the firms behave competitively within the industry, and how competition is generally undertaken. From this information it becomes easier to determine exactly what the marketing strategy should actually achieve. There are Five dimensions of strategic marketing goals: 1 - Divest objectives are sometimes necessary when offerings continue to incur losses and generate negative cash flows. Can follow on naturally from the harvesting strategy. Basically about killing the business 2 - Harvesting objectives are often employed in mature markets as firms/offerings enter a decline phase. The goal is to maximise short-term profits and stimulate a positive cash flow. See that a business is not going to do as well as you think it the future, or you think you drawing cash out of a particular business because it has no future. 3 - Hold objectives are concerned with defence. They are designed to prevent and fend off attack from aggressive competitors. About balancing out the business - you're just trying to maintain this; hold your position. You don't know if it will do well in the future, so neither invest or divest. 4 - Niche (which is also a growth strategy) is just focusing on a particular segment. objectives are often the most suitable when firms operate in a market dominated by a major competitor and where financial resources are limited. Niche can be a small segment or even a small part of a segment. To be successful in niche markets it is important to have a strongly differentiated produce offering supported by a high level of service. 5- Growth - "Ansoff's Matrix" • Intensive growth - refers to concentrating activities on markets and/or offerings that are familiar. Intensify the activity you do in a particular market. • Integrative growth - you may want to work with the product you already have, but want to expand your consumer base... it occurs where an organization continues to work with the same propositions and same markets but starts to perform some of the activities in the value chain that were previously undertaken by others • Diversification - refers to developments outside the current chain of value-adding activities. This type of growth brings new value chain activities because the firm is operating with new offerings and in new markets. This often happens through joint ventures or mergers and acquisitions. Depending on your goals, you may choose different actions.

Describe the strategic planning process and explain the key influences that shape marketing strategies

The strategic planning process commences at the corporate level, where the organisation sets out its overall mission, purpose and values (however, is not a linear process). • Mission: Why we exist • Vision: What we want to be - a compelling view of the future. • Values: What we believe in/how we behave • Strategy: Our competitive game-plan • Implementation: How we implement/monitor our strategy These are then converted into measurable goals that apply to the organisation as a whole. Then depending, upon the size of the organisation, the range of business and/or offerings is determines and resources allocated to help and support each other. Each business and/or offering has detailed functional and competitive strategies and plans, such as a marketing strategy and plan, developed around them. There are 4 stages of strategy implementation: - Goal setting - Situation review: Environmental analysis - Strategy formulation: see below - Reasource allocation and monitoring There are 3 key influences on marketing strategy. These are: 1) Strategic market analysis - It is necessary to develop knowledge and understanding of the marketplace, referred to here as strategic market analysis. It is then necessary to determine what the marketing strategy should achieve, and then how the goals are going to be achieved. This stage relates to strategic marketing audit. You need to understand both your internal and external marketing environment - "know heaven, earth, thy enemy and thy self'. A means of knowing your internal environment is through a SWOT analysis. 2) strategic marketing goals - which are about what the strategy is intended to achieve • The purpose of strategic marketing analysis is to help managers understand the nature of the industry, the way the firms behave competitively within the industry, and how competition is generally undertaken. • From this information it becomes easier to determine exactly what the marketing strategy should actually achieve 3) strategic market action - which is about how the strategies are to be implemented. • Essentially about Competitive Level Strategy, Sustainable Competitive Advantage, Competitive Positioning, Strategic Intent • Who are our competitors? o E.g. for a restaurant, competitors could include: a restaurant next door, a restaurant in another area, supermarket ready meals, pubs and theatres, domestic kitchen equipment suppliers

What is the relationship between these different competitive positionings? What is the strategic intent between them?

You can either attack or defend the positioning. ATTACK STRATEGIES: • Frontal attack - a head-on assault on a rival, used when there are low levels of customers' loyalty poorly differentiated offerings, and it is easy for customers to switch brands • Flanking (or proactive) - involves pressurising a rival's vulnerable or unguarded areas. This might be a market segment that is not served very well by existing competitors, a geographic area that is open, weak or unsatisfactory offerings, or inappropriate distribution channels. E.g. Hagendaz versus Ben & Jerry's. • Encirclement - involves attacking a rival on all sides, literally encircling the target rival. Fashion, design, features... trying to capture the whole market. • Bypass - related to diversification. Involves introducing new offerings or technologies that rewrite the rules of competition in the market and avoids direct conflict with a rival. E.g. Virgin - always try to do things that are completely different. • Guerrilla - involves irritating and slowly eroding a rival's market share through a series of unpredictable attacks on their weaker areas. This strategy is useful for small firms who have relatively few resources in situations where the target is able to defend itself relatively easily from a frontal or flanking attack DEFENCE STRATEGIES: • Position - involves building fortifications 'sitting tight; and defending the current position. • Flanker (reactive) - protecting the rear and the flanks, as these are potential weaknesses. By strengthening the competitive position in these segments, with new offerings, and by repositioning existing offerings it becomes a possible deter attack E.g. Toyota created Lexus as a new brand of luxury cars in America • Counter-offensive - these strategies used as retaliation once an attacker has engaged. Aim is to hit the attacker's weak spot - increasing their portfolio • Contraction - choose to de-vest from certain aspects of their business. Some markets or segments are too weak to be defended so the best action is to withdraw and concentrate resources around protecting core offerings • Pre-emptive - these strategies are built on the premise that the best form of defence is attack, and by getting one's retaliation in first' it becomes possible to prevent an attack. If you attack, you must be clear with who you are attacking why. You can attack: • The market share leader in its primary target market • Another follower in a major market segment • One or more smaller competitors who have limited resources • Aim for an unserved segment; tend to be the richest source of profits

Explain different channel conflicts

• Channel conflict occurs when one channel member perceives another channel member or company to be acting in a way that prevents the first member from achieving its channel goals. Types of channel conflict: **Horizontal** channel conflict • Occurs between intermediaries on the same level of the same type e.g. grocery stores • Different types of intermediaries on the same level e.g. Topshop and M&S • Caused by channel members impose on the market territory of other intermediaries **Vertical channel conflict ** conflicts between different levels of the same channel • Most frequently occurs between producer and wholesaler or producer and retailer • Caused by: intense price competition, disagreement about promotion, costs of services, differing expectation of performance, tough economic times **Multichannel conflict** • Two or more channels owned by a single manufacturer compete against each other when selling in same market. • Caused by: the distribution of branded goods to unauthorised dealers

What are the different pricing tactics?

• List pricing - an approach to pricing where a single price is set for an offering. E.g. hotels often charge what they call 'rack rates' for hotel conferencing facilities • Loss-leader pricing - the price is set at a lower level than the actual cost incurred to produce it. E.g. supermarkets to entice customers in store. Profit made by increasing prices of other less price sensitive items. The loss-leader is the free game, buy the add ons. • Promotional pricing - companies temporarily reduce their prices below the standard price to raise awareness of the offering to encourage train and to raise short-term brand awareness • Segmentation pricing - varying prices are set for different groups of customers e.g. Ben and Jerrys available in cinemas • Customer-centric pricing - companies take advantage of customer segments by measuring their value perceptions, measuring the value created, and designing a unique bundle of products and services to cater to the value requirements of each segment • Pay what you want pricing - like Wikipedia

What is the difference between Market Research, Marketing Research and Consumer Insights?

• Market research is conducted to understand markets - i.e. customers, competitors, and industries. It is work undertaken to determine the structural characteristics of the industry of concern, whereas marketing research is work undertaken to understand how to make specific marketing strategy decisions. • Marketing Research determines the impact of marketing strategies and tactics, in addition to collecting information on customers, competitors and industries. It generates information to provide management with sufficient insight to make informed decisions. It follows the philosophical marketing premise that organizations must understand the motivations, desires, and behaviour of market research, marketing research and customer insight - these terms are related but not interchangeable. • Customer insight is knowledge about customers which meets the criteria of an organizational strength, that is, it is valuable, rare and difficult to imitate and which the organization is aligned to make use of. Smith et al. (2006) suggest that customer insight is valuable, rare an inimitable knowledge about customers which an organization can make use of to formulate management decisions.

Describe the nature, purpose and scope of marketing communications.

• Marketing communications, or promotion as it was originally called, is on if the P's of the marketing mix. It used to communicate an organisations offer relating to an offering, or the overall organisation. In broad terms, the management activity consists of several components. There are the communications experienced by audiences relating to both their use of the products and the consumption of associated services. There are communications arising from unplanned or unintended experiences, and there are planned marketing purposes.

Marketing versus market orientation

• Marketing: the action or business of promoting and selling products or services, including market research and advertising. • Market orientation: is the system of understanding of what it is to do marketing. Oriented to having a marketing department, using it to listen to their customers and competitors. It is a company philosophy focused on discovering and meeting the needs and desires of its customers through its product mix. Comprises of 3 things you pay attention to: o Customer - listening to the them & what the need and want o Competitor - observing their behaviour in comparison to yours o Inter-functional coordination: all the information you get you have it persisting through every part of the business, and everything is doing what they should be doing. • You can have marketing without having marketing orientation

Explain the Marketing Mix and the 4Ps

• Neil Borden developed the concept of the marketing mix in his teaching at Harvard Uni in the mid 1950s • His idea of marketing managers as 'mixers of ingredients' - to fit the requirements of customers' needs at any particular time • He developed a 12 list item which manufacturers should consider when developing marketing mix policies and procedures (Borden, 1964) • The list included product planning, promotions, display and servicing But the list was amended by Eugene McCarthy (1960) The 4 Ps of marketing: 1. Product - the offering and how it meets the customer's need, its packaging and its labelling 2. Place - the way in which the offering meets the consumer needs - distribution 3. Price - the cost to the consumer and cost plus profit to seller 4. Promotion - how the offerings benefits and features are conveyed to the potential buyer • Intention was to create a simpler framework for managers to develop a plan. • Some recognition that all of these elements are interlinked which McCarthy did not take into account when creating his framework • Criticisms that the 4Ps framework is of limited use

Primary vs. Secondary information

• Primary research is research you conduct yourself (or hire someone to do for you.) It involves going directly to a source —usually customers and prospective customers in your target market — to ask questions and gather information. • Secondary research is a type of research has already been compiled, gathered, organized and published by others. It includes reports and studies by government agencies, trade associations or other businesses in your industry. Especially for small businesses with limited budgets, most research is typically secondary, because it can be obtained faster and more affordably than primary research. E.g. reports, consumer trends researched by others, etc...