Strategic Marketing
Who defines the market and determines the attractiveness? (p.217)
(1) Customer-defined markets: all products and services which may meet the same customer needs and problems (2) Competitor-defined markets: focuses on all the competitors that could possibly serve the needs of a group and reflects similar technology, production costs and distribution
What different types of organizational roles are there in the marketing function? (p. 47-48)
(1) Functional organization: sales management, advertising, promotions management, market research, product development (2) Product management vests all marketing responsibilities for one segment or product - Brand sales managers: handling brands in field, working with trade, designing localized strategy - Category management: entire product line like all dishwasher soaps or home electronics - Category teams can each take their own sector or the category (adults v. children) (3) Market management organization: specific needs of target segments ex) McDonald's has directors of the Asian, Black, or Latino markets Customer development managers Brand development managers
What are the four types of Leadership styles that Rossiter recommends us to consider? (Diverge p. 122-123)
(1) Authoritarian Leadership - derives its power from authority or position; employees are motivated more by your title than by their desire to achieve; they feel they "have to" follow you because you're "the boss" (2) Associative Leadership - derives its power from relationships; employees follow you because they sense you care about and respect them as individuals; they trust you to lead them in the right direction; some may have blind faith in you because you make them feel cared for and comfortable (3) Achievement Leadership - derives its power from performance; employees have confidence in you because in the past you have blazed trails and delivered results; they follow your lead because they want to be part of a winning team (4) Advancement Leadership - derives its power from vision; employees follow you because you offer them the vision and opportunity to attain higher levels of personal and professional accomplishment; they are willing to make sacrifices to achieve this higher level of performance because you inspire them to advance beyond merely "wanting to win" to "wanting to be amazing"
Name and describe four or five customer based marketing assets? (p.141-143)
(1) Company Name and Reputation - most important, in many cases it has been converted into a brand name for use on products; reputation can also be a negative asset or a liability because many consumers are reluctant to deal with companies they regard as unethical (2) Country of Origin (COO) - for companies operating in international markets, the identify of the home country can contribute either as an asset or a liability; country of origin can provide a good reputation for quality, favorable image, and value for money (3) Market Domination - market presence or domination is used as one of the criteria for valuing brands; market leaders enjoy good coverage of the market, wide distribution, good shelf position, and believed by consumers in some way to be better than the rest of the market (4) Superior Products & Service - unique products or services, until they are imitated, can provide marketing assets, so long as customers want them and are prepared to pay for them (5) Brand - brands are powerful marketing assets because brands are difficult to build, add value for customers, create defensible competitive positions, build customer retention, can transform markets, perform financially, and can cross national borders.
Michael Porter argues that competitive positioning and differentiation can occur in two main ways. What are they? What is a third alternative? (p.44)
(1) Cost Leadership - company seeks to have low costs compared to competitors while selling products that are competitive (2) Differentiation - company strengths used to differentiate the company's offerings based on valuable criteria to customers Third alternative - Differentiation AND Cost Leadership - differentiation through better quality can result in lower unit costs through high market share and economies of scale
In companies with Market-led orientation, five components merge together to create a new culture. What are they and what is their impact? (p.8-9)
(1) Customer orientation: understand customers well enough continuous to create superior value (2) Competitor orientation: awareness of short and long term capabilities of competitors (3) Interfunctional coordination: using all company resources to create value for target customers (4) Organizational culture: linking employee and managerial behavior to customer satisfaction (5) Long-term creation of shareholder value: as the overriding business objective - Market-led orientation: is associated with organisational performance like employee commitment - There is a significant and compelling amount of support for the view that market orientation is associated with superior organizational performance (i.e. financial performance and non-financial performance such as employee commitment).
What can a SPACE analysis tell you about an industry, competition or financial strengths? (p.82- 83)
(1) Industry strengths: -attractiveness of the industry in terms of growth potential, profitability, ability to use resources efficiently, financial stability, market entry ability, productivity (2) Competition: -their advantages, market share, product quality, product life cycle, customer loyalty, competitors' capacity utilization, etc. (3) Financial strengths: -company's ROI, leverage, liquidity, capital required, cash flow, exit barriers, risk
What are the five roles in the Buying Process that are important to understand in customer analysis? (p. 90)
(1) Initiator - this is the individual (or individuals) who initiates the search for a solution to the customer's problem. (2) Influencer - all the individuals who may have some influence on the purchase decision. (3) Decider - they take into account the view of the initiators and influencers and actually make the decision as to which product or service to purchase. (4) Purchaser - the individual who actually buys the product or service. They are, in effect, the individual that hands over the cash in exchange for the benefits. (5) User - the individual who consumes the offer. It's the end user o the product or service
What factors affect market attractiveness when you are doing an assessment?
(1) Market factors (2) Economic & technological factors (3) Competitive factors (4) Business environment factors
How has the definition of marketing evolved over the past twenty years? What is the fabric of the new marketing concept? (p.6 and p.9))
(1) Originally, marketing concept was about integrating functions that produced profits efficiently and effectively by satisfying customers (2) Then it evolved to product planning, promotion, price, and placement to satisfy individual and organisational objectives (3) Today, it is an activity for creating, communicating, delivering, and exchanging offerings that hold value of customers, clients, partners, and society
What are four traps to avoid when determining the attractiveness of markets and branding positions? (p. 215)
(1) Peripheral business- where company could be strong but where the market doesn't deliver enough company benefits (2) Illusion business - areas where the market appears good, but can only ever be a weak spot for a company (3) Dead-end business - markets that are not attractive and company can only take an 'also-ran' position, firms should exit (4) Core business - *the ideal* markets offering benefits and returns, just hard to tell what makes a market strong & attractive
What are the four mistakes that Rossiter identifies in many strategic planning processes? (p.90-94)
(1) Prioritizing showmanship over leadership - reward innovation, vision and results rather than sparkle (2) Failure to start afresh each year - optimize planning by not copying last year, but considering all new changes (3) Failure to develop contingency plans - unforeseen changes, good and bad (4) Failure to conduct scenario planning - think about how competitors and customers will react
What alternative targeting strategies can a company uses after they have completed their assessment. (p.231-232)
(1) Undifferentiated marketing - producing a single product designed to appeal to all segments (2) Differentiated marketing - offering a different product to each of the different segments (3) Concentrated marketing - focusing attention on one, or a few, segments
What are the five components of Corporation's mission objectives and strategy? (p.31-32)
(1) strategic intent - vision of what you want to be (2) company values - guiding principles (3) distinctive competencies - core skills (4) competitive positioning - differential advantage (5) market definition - customer targets
Why is it important to understand the 80/20 rules when segmenting your market?
- 80% of sales typically come from only 20% of customers. High-volume product users may be different from medium and low users in how they purchase. - The final use to which the product or service is put might be of interest. Where the final consumer can be identified, working backwards can suggest a sensible segmentation strategy.
A Priori Segmentation is a more standard method since it uses Public Data. However, what are the flaws of using "A Priori" methodologies when trying to segment a market? (p.189-191)
- A Priori: Single variable segmentation approach - Involves searching among demographic or socio-economic characteristics & identifying which of these forms is significant and useful splits within the marketplace - Advantage: can be undertaken from secondary sources - Flaws: Attempts to validate demographic and socio-economic bases in terms of product preferences have met with little success >>Not a sufficiently powerful predictor
How does an Industry's "Branding" practices cause a "Buyer" to turnover his "power" of choice? (p.72)
- A buyer will turnover their power when the suppliers' offerings are very differentiated - for example, Intel has a strong reputation based on its brand, and this gives them leverage and power when interacting with buyers who want a well-known brand. - When buyers are very brand-loyal they will be less likely to choose an alternative, therefore giving the power to their brand of choice - They are more concentrated than sellers, There are readily available alternatives sources of supply and buyer switching costs are low.
What is a "Competitor Capability Profile" and why would you do one? (p.118-120)
- A way to assess marketing culture, assets and capabilities, production and operation capabilities, and financial resources: rank on -2, -1, 0, 1, or 2. - - Then add up for each piece and compare. - Key indicators are customer relationship strength, new product success rates, quality of people, product available, and promotional expenditure - Do it to predict future strategies
(90) Name some ways Segmentation is done in the B2B world. What groups and characteristics are used? ( p.176-179)
- Background Company Characteristics: industry type, company size, customer location, company technology, customer capabilities, purchasing organization, power structures, purchasing policies, product application - Attitudinal Characteristics: - Behavioral characteristics: buyer's personal, product/brand status
How does "Benchmarking" help in understanding one's competitors? (p.108-110)
- Benchmarking: measuring your company's strategies and operations against 'best-in-class' companies, both inside and outside your own industry. - Identify certain practices and methodologies that can then be adopted or adapted to improve your own performance. - 4 main steps: (1) identifying who to benchmark against, (2) what areas of business to benchmark, (3) collecting relevant data for comparisons to be made, and (4) actually comparing the data points.
Why do so many companies get confused on their purpose and mission? What fundamental questions aren't they asking? (p. 30)
- Companies get confused on purpose and mission because they are not asking the right questions and they don't know what business they are in - The questions they are not asking are (1) what business are we in? (2) what business do we want to be in?
(71) What are "Marketing Resources" and how do they often get overlooked as company assets? (p.132-133)
- Def: brand reputation, relationships with customers, distribution network create VALUE - They enable provision of superior value to customers and are resistant to duplication
Describe Geographic, Demographic, Psychographic and Behavioral market segmentation. What are the pros and cons of using each. ( p. 166-175)
- Geographic: useful for small or medium marketing operations that can't attack largely dispersed market - Demographic: segmenting based on things like gender, age, culture, etc. This is a very popular way to segment because it allows for easier division of groups - Psychographic: a bit harder to study, usually includes the personality which can be studied best through a large set of questions and analysis. Lifestyle characteristics are also a large part of this (activities, interaction with others and opinion) - Behavioral: purchase behavior, consumption behavior, communication behavior, responses, etc. You study how your consumers are acting and use their reactions to take actions
McDonald's used a Segment Manager approach to help them organize their efforts? What was the good news and bad news about organizing that way? (video)
- Good news: allowed them to distinctly target each segment based on race and researched preferences of these particular races - was actually very effective - Bad news: reinforced stereotypes, generalized stereotypes, was offensive
All organizations have many "Stakeholders" in the success of an organization. Why is it important to understand each interest, how they work together and how they conflict? (p.16-19)
- Important Stakeholders include: shareholders, employees, managers, customer, distributors, suppliers - Each player has a different interest and goal e.g. employees care about compensation, job satisfaction and security, while suppliers and distributors care more about security, predictability and good margins
In the "Emergence" stage what are some of the issues for new product and how can marketing help? (p.78)
- Issues in Emergence stage: 4 uncertainties - technological, commercial, customer, and channel - Strategies to help: locate innovators and early adopters, establish standard, reduce switching cost risk, encourage trial
Multi-dimensional attribute segmenting gives several characteristics and features of a product and offering to the research. What is the Pros and Cons of that method? (p. 207- 210)
- Look at dimensions simultaneously rather than separately (like the attribute profiling) - used to summarize the mass of data collected in visually appealing and easily communicable ways. They are perhaps best seen as visual models of the customer's mind. -multi-dimensional scaling is primarily concerned with identifying segments of respondents who view the products on offer in a similar way (perceptual space segmentation) and require from the market similar features or benefits (preference segmentation). - Cons: shows a representation of the similarities between objects but tells us little of why they are seen as similar or dissimilar, maps are ambiguous and there is a danger of researchers superimposing their own views on what is going on, customers may give a simplistic answers about how they differentiate the market, maps try to represent too much information in the same two dimensions (customers' perceptions are very complex), Using three or more dimensions makes the situation usually less understandable, compresses market into one simple perspective
Adidas watched the great success of their competitor Nike. What did they learn from them as they kicked off their drive in the United States market? (p.128-129)
- Nike has done a significantly better job targeting to the younger consumers, especially through the use of branded marketing and social media. -Nike has been more effective in terms of capturing consumers through social media platforms and staying up to date on technological trends - Beneficial for Adidas to benchmark some aspects of its performance against Nike, especially if Adidas' long-term goal is to penetrate the U.S. market more and gain more share there.
At Gap, they used three Brands of Old Navy, Banana Republic and GAP to do portfolio management which segmented the clothing market. How did they do it and what were the Pros and Cons?
- Old Navy: targets lower-income families who are looking for the best value for their price - Gap: targets middle-income customers of all ages (baby-old), go-getters who are more concerned with style Banana Republic: targets middle to upper-class consumers, young adults to older adults, more fashion-conscious - Gap enforces brand loyalty by applying Maslow's hierarchy of needs to its solutions (B.R. at the top, Gap in the middle, O.N. at the bottom) - Gap positions its brands through advertising, pricing, and unique products Pros & Cons???
What is the Clustering methods for Market Research and what are the advantages of using the approach? (p. 194-199)
- Once the data on which the segments are to be based have been collected, they need to be analyzed to identify any naturally occurring groups or clusters. The techniques used to identify these groups are called cluster analysis. - Cluster analysis is a whole class of techniques that, while sharing the same objective of identifying classifications with homogeneity internally but heterogeneity between them, use different methods to achieve this. -Shows similarities and dissimilarities, and in some circumstances, segmentation can be very clear-cut - clusters of customers will show similar customers in clearly defined segments that can then be targeted with the same market solutions
Perceptual Mapping helps tell a story about how an industry and different market positions relate. What is the advantage of using that tool? (p. 210)
- Perceptual maps simultaneously show the positions of objects (brands and segment ideals) and attributes (dimensions) -they can be used for analyzing the market and where companies are positioned currently in order to determine different opportunities that a company can target in the market
How does Competition environment in an industry define a markets attractiveness? (p. 223-224)
- quality and intensity of competition - threat of substitution - degree of differentiation
Compare the three strategies and marketing approaches of "Product-push" marketing, Customer-Led marketing and Resource-based marketing. (p.13)
- Product Push Marketing - firm focuses on existing products they are already good at making and tries to convince customers that this product is superior to competitors and that they want this product - Customer-Led Marketing - chase customers at all costs, figure out exactly what they want and give it to them (done too aggressively can lead to problems) - Resource-Based Marketing - middle ground between both extremes (most positive form), firm seeks a long-term fit between requirements of market and customer and the abilities of the firm to compete in it, opportunities are seized when firm has a potential advantage through resources, very strategic and long-term planning
What can Company records tell you about your customers? (p.92-93)
- Purchase records: can show who purchased, how much, how loyal they are, - Sales records: profitable customers, frequency of purchase,
Give examples of qualitative and quantitative types of marketing research. When could they be used? (p.96-97)
- Qualitative: emphasis is placed on gaining understanding and depth in data that cannot be quantified; it is concerned with meaning rather than numbers >> Examples: group discussion, individual interviews - Quantitative: involves larger samples, more structured research instruments, and produces quantifiable outputs; used to provide quantification of the broad qualitative findings >> Examples: surveys, observation, experiments
Attribute profiling methods are a great way to compare similar businesses or services. How do they work?
- Respondents rate each offering being compared on a semantic scale (usually from 1-7) on different dimensions >>For example: Store A, B, and C are all compared on a 1-7 scale on things like high quality vs. low quality, price, helpful staff vs. unhelpful staff, etc. - Weigh each dimension separately depending on importance and scores on each dimension are taken separately and then computed into an overall score
What is a "markets-served" approach to segmenting? (p.219)
- Segments are defined in terms of the customers themselves rather than the particular products they buy. - A useful way of segmenting is the benefits the consumer is looking for in the products/service.
What is the purpose of a Product-customer mix matrix? (p.217)
- Used to examine a market to identify no more than 5 or 6 groups of products and services and 5 or 6 groups of customers that constitutes the matrix. - it starts to identify the way a market divides into distinct segments
Stanford Research developed the VALS approach to market segmentation, dividing each segment into seven groups or profiles. How does one use a VALS analysis? (p. 193)
- VALS: lifestyle segmentation scheme that segments people into seven categories - belongers, achievers, emulators, i-am-me group, societally conscious, and sustainers - When added to databases, they provide a powerful means of shifting from target markets to individual customers - Lifestyle segments provide a more graphic portrayal of customers than do demographics >>can give suggestions for advertising copy platforms
Why did Waterstone's buy Paperchase? Why do you think the small book suppliers are becoming successful again in the book selling world? (p.130 -131)
- Waterstone's wants to pair up with Paperchase because it plans to expand its stationery range, which has done well in recent years in some of its other stores. >>Paperchase is a well-established and respectable brand that can strengthen Waterstone's own brand and offer more value to consumers looking to see popular brands in the bookstores. -The store has been hit hard from online book retailers, so in an effort to maintain growth, the bookstore company is looking to expand product offerings to generate more revenue and hopefully more overall value to the consumer. - They are becoming successful again because customers value the experience of being in a bookstore and the tangible aspect of books. Aspects like coffee shops, reading nooks, and a peaceful ambiance are attractive to consumers who want more than just to purchase a book online.
What type and sources of competitive information is available to the public that can be important in competitive analysis. (p.125)
- What they say about themselves (advertisements, recruitment ads, promotional material, technical reports, and press releases) - What others say about them (newspapers and magazines, trade sources, customers) - Propaganda, publicity material, former employees, surveillance, dirty tricks
How can Strategic Alliance with other companies give one a competitive advantage? (p.147)
- alliances can be seen as one way of increasing a company's pool of assets and capabilities without incurring the expense and loss of time in developing them in-house. (1) Market access- for example, alliances with local distributors are frequently the only way open to the exporter to enter protected overseas markets. (2) Management skills- partnerships may bring access to abilities not held in house, both in technology management and marketing management. (3) Shared Technology- alliances are often the basis for sharing and combining technology to create market offerings with higher customer value, which neither partner could achieve alone. (4) Exclusivity- partnerships may create monopolistic conditions.
In Diverge, what is the cultural change he suggests in trying to get to a new growth strategy? (Diverge p. 104 - 109)
- creating and embedding a "culture of possibility" throughout the entire organization. The company needs to start identifying bigger gaps, making bigger decisions, hiring smarter people, taking greater risks, and seeking bigger opportunities, so its actions align with and augment a bigger goal -Companies must identify a "possibility market," which is the share of the market that they can possibly capture, not merely the share of the market that is currently being captured.
The business environment, political, legal, economic stability and physical environment all influence the attractiveness of the marketing environment. How?
- economic fluctuations - political and legal factors - degree of regulation - social acceptance - physical environment impact
Gatwick became an independently run operation. What marketing program did they adopt to become successful? (p.106-107)
- make Gatwick a new nature-style logo and a campaign aimed at making the airport friendlier. - Under the new rebranding, Gatwick became known as 'Your London Airport' > more personalized experience - Amenities enhanced to better serve customers: faster check-ins, new security lanes, the baggage halls, departure lounges, entrances, and terminal interchange.
Danone did a portfolio analysis and decided to focus on fewer products and turn to volume rather than sales growth. How did that change their company? (p.86-87)
- shifted to the objective of volume growth instead of sales growth -Danone understands that focusing too heavily on sales growth can put pressure on managers to deliver, leading to possible immoral shortcuts and frequent errors. -Danone recognizes that it is wiser to reduce prices to increase volume sold instead of closing down factories. -The focus on yogurt, baby food, and water narrows down the portfolio so they can focus on improving these products rather than a huge portfolio.
Ryanair decided to compete in the business segment. What brought them to that decision and how did they assess the environment to make them think they could pull the strategy off? (p.234-235)
- there is a demand from business consumers for better products and service offered by airlines. In addition, Ryanair wants to rid any stigmas consumers have about the airline and its quality and treatment of consumers. Ryanair wants to offer similar solutions to competitors' business class offerings but at a lower price point. -Ryanair is attempting to be viewed as now "caring, cuddly, and sharing." Up until now, Ryanair has been perceived as the low-priced, non-frilly airline provider that primarily attracts consumers who want the cheapest flight they can get. It will be difficult for the company to change their image into something more positive and of higher-quality, especially with its current perception among consumers
What economic and technological factors affect market attractiveness in assessing a market? (p.222-223)
-Barriers to entry, barriers to exit, bargaining power of suppliers, level of technology utilization, investment required, margins available
Rossiter talks about "living your promise" as a key ingredient in developing your personal brand. What does he mean? How did JC Penney's fail with it? (Diverge p. 50-52)
-By fulfilling on your brand's promises, you can create confidence within customers and leadership within the marketplace because of a high reputation. In addition, living on your promise can ensure that everyone at your company is aware of the brand's image and promise and continue to maintain it. By staying true to your brand's promise, it can help strengthen your message and customer satisfaction and confidence, creating more value in the long run by maintaining loyal customers over time. -JCPenney tried to reinvent the company by appealing to younger, trendier consumers. They changed the image, stores, and products. This caused the core customer base to abandon the brand and the new target market did not connect with the new "JCP" nor had the funds to buy the products. The company did not deliver on its already established promise to its core audience, and its brand inconsistency via advertising and in-store differences caused issues.
When examining ones' resources and products by doing a "resource portfolio" analysis, how can you quantify the value of a product or brand of a company? How can is this done? (p.151)? ?
-By importance of resource in creating value AND resource strength relative of competitors There are four main categories in a resource portfolio: (1) Achilles heels (high value, inferior strength) - resources that differentiate the competition in ways important to customers. (2) Crown Jewels (high value, superior strength)- resources that help differentiate in ways of value to customers. (3) Sleepers (low value, inferior strength) - resources that are less important today but be wary in case they become important tomorrow (4) Black Holes (low value, superior strength)- potentially costly resources where we have an advantage but that don't create value for customers.
What is a "Marketing Decision Support System" and how is it used? (p.103-104)
-MDSS changes the emphasis from provision of information, primarily in the form of facts and figures , to aiding decision making through the provision of question-and-answer facilities. It basically allows analysis rather than merely retrieval of information. - supports decisions (actively designed to help managers make better decisions and support managerial decision making), - is interactive (allow the manager to ask questions, receive inputs, and experiment with decisions to estimate the likely outcomes), - should be flexible and easy to use (allows the system to respond to a variety of information and decision support needs). - Two types of output: >> (1) Data-oriented focuses on data retrieval and simply analysis using statistical techniques. >> (2) Model-oriented focuses on simulation and representation of aspects of the real world using accounting models, representational models, advertising models, optimization models, etc.
(81) How did Miele exploit their manufacturing and design capabilities to help them in their marketing programs? (p. 154)
-Offering galleries where shoppers can look at latest appliance models and join seminars to cook or clean using them -Manufacturing capabilities: product testing, makes everything in German.
What are the Pros and Cons of looking at a company through a "Resource-Based view"? (p.135)
-PROS: allow company to see how another might position themselves and what their competitive advantage may be from assets and capabilities, inward looking, distinguish between assets and capabilities -CONS:could ignore demands of changing, turbulent marketing environments and market dynamism -Value, rarity, inimitability, non-substitutability
What is the role of Marketing Research in understanding your customers? (p.92-95)
-The use of marketing research services by a variety of organizations, from commercial firms to political parties, has increased dramatically in recent years. Large amounts of data can be used to aid marketing decisions (both strategic and tactical) are held in unlikely places within the company.
Name several recommended "Marketing Metrics" that helps justify the investments into marketing programs and budgets. (p.49)
-These metrics help link marketing activities to high financial returns of a business -Metrics: relative perceived quality, loyalty/retention, total number of customers, customer satisfaction, relative price, market share, perceived quality/esteem, complaints, awareness, distribution/availability
Internal Marketing Support excellence can be a difference maker in marketing success. How? (p.145-146)
-When you have the latest technology it can achieve better capacity utilization - existing customer base. (80/20) - technological skills. being able to operate new tech smoothly in order to have cost reductions. - Production Expertise- marketing asset in which you can have a high quality product produced for much less. - Copyrights and patents can be marketing assets because no one else can have them. - franchises and licenses can be marketing assets because they can be run by franchise owners. - Partnerships can be helpful because an alliance based network can contribute to marketing success through using different channels that others will not. - Corporate culture is a marketing asset because how everyone markets the brand is how most will see the brand.
How did Kodak fall into the "Leader's trap" according to Rossiter? (Diverge p.59-63)
-Worried about losing market share that they stop innovating and only look for ways to be stable -Kodak developed first digital camera but thought it would cannibalize its own film industry but eventually got left behind when the market moved on without them, protectionism
Name the six Marketing fundamentals discussed in the chapter and their primary description. (p.19-22)
1. Focus on the customer - long-term goals of firm are best achieved through customer-orientation, but not a blind focus, need to precisely consider needs and resources to fulfill those needs 2. Only compete in markets where you can establish a competitive advantage - a company needs to have the right skills, competencies and resources to even ensure success 3. Customers do not buy products - customers buy the problem the product solves, or the solution, or the benefits it has (marketers should view a product as a bundle of benefits) 4. Marketing is too important to leave to the marketing department (if there is one) - marketing is everyone's job in terms of being market-oriented in the culture and thinking of the consumer first 5. Markets are heterogeneous - customers are very different and benefit segmentation may be helpful 6. Markets and customers are constantly changing - customers are constantly demanding and expecting more, so innovation is necessary
What is the three roles of marketing within the organization? (p. 23-24)
1. Identification of customer requirements - research for who customers are and what they want. 2. Deciding on the competitive positioning to be adopted - markets are different, so a firm must decide who to target. This decision is based on how attractive the the alternative potential targets are and how well the company can serve each target relative to competition 3. Implementing the marketing strategy - use all resources to plan and execute customer satisfaction
What does a SWOT analysis reveal about a company? How can it help one develop strategy? (p.39)
A SWOT analysis reveals the internal and external factors affecting a company (strengths, weaknesses, opportunities, threats) and provides summary of the issues. - It also provides a way to form a strategy by seeing how to utilize strengths and diminish weaknesses by seeing where strengths can be exploited and where weaknesses may be vulnerable to market change and competitors.
Why can't a firm act "Market-Oriented" if it doesn't understand its' own business capabilities?(p.137)
A market-oriented company... 1. ensures focus on customers and avoids focus on internal capabilities 2. encourages innovation/creativity 3. stimulates awareness of changes so products stay relevant -If a firm doesn't understand its business, they will not know what business they are competing in and will not be able to figure out their unique and general advantages from their competitors. -The product will not be relevant because they will not have a clear strategy and will most likely know who they are targeting.
Why is "portfolio analysis" vital in the planning process? Is balance necessary in the portfolio?(p. 35-37)
A portfolio analysis helps a company to understand the resources it has, and if a company has multiple product categories, this process is important because each segment has different markets, opportunities, threats, etc. and so objectives and strategies need to be made for each business unit and should support each other.
Who does Rossiter in Diverge say that the "True Market leader" in any given industry? (Diverge p.54-54)
A true market leaders is a company that actively advances a product category, a market, and ideally an entire industry. It's about positive enhancement of the market, not about share, influence, or control.
Why did AGA Appliances focus on a "bio-gas" solution to expand their market? (p.54-55)
Aga ovens have been criticized by some for wasting energy by pumping out heat when it isn't needed. Therefore, Aga modified their ovens to run on biogas produced from food waste by anaerobic digestion, which is a natural biological process. Their previous sharp falls in demand have now leveled out, and demand has even strengthened in some areas.
E-Readers companies like Amazon and Apple cut prices. How did Market Research play in this decision when the market was so hot? (p.188)
Amazon and Barnes & Noble did research on Apple and determined that in order to better compete with Apple's new tablet computer, they had to readjust the prices of their e-readers. Market research gave the companies better insight about their competitors and what their competitors were doing to capitalize on a hot market.
The marketing strategy process asks for both an environmental and company analysis prior to formulating a core strategy. Why? (p.33)
An environmental and company analysis must be done PRIOR to strategy creation because assessing the company's capabilities and the threats and opportunities in the environment help the company to identify objectives.
LEGO was trying to adopt additional marketing opportunities to their recent growth efforts. How does electronic games fit or conflict with that strategy?
By adopting a game network for LEGO, the company was looking to expand into the gamer market and to attract youth that are now highly interested in gaming. This was both positive and negative; for some it was exciting but for others it was confusing and drew away from LEGO's original hands-on approach.
When conducting a competitors' analysis, what four components should be studies (according to Lehman and Winer)? (p.111- 115)
Assessments of competitors'... (1) Current and future objectives: understanding what the competitor is setting out to achieve can give clues as to the direction it will take (2) Current strategies: the firm can identify opportunities and threats arising from competitor actions. (3) Resources: the asset and capability profile of competitors shows what they are currently able to do. Gives further clues as to how the competitor will move in the future, or how the competitor will react to threats. (4) Predicting future strategies: the firm can begin to answer perhaps the most fundamental question in competitor analysis: what is the firm likely to do in the future?
Why study the "degree of turbulence" in a marketplace? What will it tell you? (p.80)
Because turbulence, or instability, is relevant in all the stages of a product's life cycle, but in the mature and later stages as well. It can tell you things like pressure from customers, aggressive market leaders, demand outstripping supply, low profitability, high product differentiation, number of sales spent on marketing, etc.
In "Diverge", Bill Rossiter talks about the success of Best Buy over Circuit city. What did Best Buy implement that made them successful? (Diverge p. 31-33)
Circuit City cared more about sales and didn't train the employees, so customers had no idea what to do with the products. Best Buy took advantage of the gap between "ability to buy" and "ability to use" by helping their customers learn more about how to use the technology. Best Buy's employees were very well-trained, focused on customer use and knowledge and had a consultative selling approach. They aim to educate and enable their customers so they feel confident using their products.
It was recommended by the author that companies should develop and exploit their assets and capabilities to help them gain competitive advantage. What is the payback for a marketing to do this? (p. 152-153)
Firms will define themselves more as portfolios of competencies than as portfolios of products or strategic business units. The roots of successful market offerings essentially lie in created and acquired competencies
By studying a Product Life Cycle for a product, how can Marketing help in each stage? (p.72-74)
Four stages: Introduction, Growth, Maturity, and Decline (1) Introduction: marketing can help with launching promotional campaigns when it first hits the market and finding ways to differentiate the product (2) Growth: defensive attacks from marketing as competitors assess the product growth and possibly enter the market, position it well relative to competitors (3) Maturity: longest stage characterized by severe competition, market fragmentation, declining profits so marketing can create strategies to fight this (reevaluate strategy and target segment) (4) Decline: slow/rapid decline of sales due to better solution, change in consumer tastes or increase in competition > marketing can address these
The effects of Globalization on Marketing are significant and Cravens and Sheth name six trends. What are they and describe them? (p.67)
GMI BMB (1) global positioning - strategists should focus on globalization and on core competencies rather than just the domestic market (2) the master brand - strength comes from brand identity that links all parts of the business (this is why Toyota and Honda are very strong compared to General Motors who has many brands) (3) the integrated enterprise and end-user focus - challenge of managing people, processes and infrastructure to deliver value to an end user (4) best-in-class processes - example: customers don't compare airline's service just to other airlines, they come from other companies and industries as well, like FedEx and Ritz hotels (5) mass customization - the goal is to achieve scale economies but also produce a product/service tailored to individual customer (6) breakthrough technology - new technology will underpin every aspect of the marketing process and the product itself, even in ways that seem outlandish
How should Marketing contribute to the success for each "Stakeholder's" objectives? (p.19)
Graph shows: market-oriented culture leads to creation of marketing resources (assets & capabilities), which leads to market performance (customer satisfaction & loyalty and sales/volume/market share), and finally to financial performance - This sort of orientation and process ensures all stakeholders are satisfied and successful
Why is it vital that you understand the competitors target markets and product positioning? (p.114-115)
In order to actually understand how relevant a competitor's strategies are, a company must know how similar their target markets and products actually are. Also, knowing this allows for a company to better position itself in the marketplace. Also, the features built into products and the type and extent of service offered will be good indicators of the types of customers that the competitor is seeking to serve
Nestles narrowed their product portfolio by selling their candy assets and focused on premium coffee. What competitive advantages did they gain from not responding to generic brands? Nespresso changed other pieces of the Coffee marketing approach to compete? (p.186-187)
Instead of engaging in competitive pricing, Nestlé wants to continue to endorse the luxury brand for what it is: an esteemed, high-quality form of coffee. Nestlé calls this strategy its 'trilogy concept,' which includes top-quality coffee, stylish coffee machines, and customized service. Instead of trying to imitate its competitors with low prices and non-frilly products, Nestlé desires to continue differentiating itself through clearly re-emphasizing its unique identity in the coffee market.
How does a survey of technology and advances in innovation help understand future strategies and opportunities? (p.63)
It is important to understand that the shortening of commercialization times has led to a shortening or product life cycles with products becoming obsolete more quickly than previously. As well, it is important to note the trend in how computer integration in manufacturing and design is shortening product development times. - Internet revolution, innovative marketing research , social media platforms
What strategy was Amazon using when they decided that the development of a Smartphone was vital to their mission? (p.50-51)
It was analyzing its competitors and saw that they could combine their already available assets to make a whole new device that connects them; they aimed to compete with the iphone, other smart phones, etc.
How does a company create and exploit a marketing asset? (p.139-140)
Marketing assets are essentially resources - normally intangible - that can be used to get an advantage in the marketplace. A wide variety of company properties can be converted into marketing assets, and they are usually grouped by customer-based or reputational assets, supply chain assets, internal or marketing support assets, and alliance-based assets.
Zai skis were marketed as a Prestige Brand and as they developed their business expansion they considered many ways to enhance their marketing. Name a few ideas they could use. (p.212-213)
Maybe come up with a slightly more affordable type of ski for the elite but younger crowd of skiers. Maybe form a new line of skis that are targeted at each gender?
Professor Malcom McDonald used the example of ICI, the European fertilizer company, and their segmentation approach that made them more profitable. How did customer segmentation help them make money? (video)
NOT DONE YET
Why is there no "Philosopher's Stone" in Market Research? What can be done about it?
NOT SURE
The NIKE brand has used a successful formula for over the past 30 years. What new ideas did they introduce to differentiate themselves from others? (Diverge p.35-36)
Nike wanted to provide the best value it could to its customers so it shifted its focus from increasing performance of its products to increasing performance of its users. Nike incorporated more technology into its products in hopes of doing just this
What mistake did Nike make when they bought the Bauer brand hockey skates? (Diverge p. 47-48)
Nike was inexperienced in the hockey segment, had not made hockey equipment before, and was overly confident in their ability to achieve success. The skates were not high-quality and had poor performance attributes. They focused on style and not performance, and their lack of knowledge in this segment caused them poor sales and a bad reputation for not delivering on its product promises.
Why is it so difficult to implement a good Corporate segmentation strategy? What goes wrong? (p.184)
OOCCIID - Unrealistic expectations, not being able to match strategy with action, poor analytical techniques, lack of communication between marketing and rest of firm - Problems include: - (1) Organizational structure: unsure who "owns" a strategy - (2) Internal politics: segmentation is cross-functional and some vying for power and vice versa may not unreliable and helpful - (3) Corporate culture: hard to speak up - (4) Information/reporting: difficult to evaluate segments without information - (5) Decision-making process: budgeting - (6) Corporate capabilities: little basis for achieving competitive advantage - (7) Operational systems: can salespeople deal with this customer? Can we product product of value for this customers?
How can "Buy-Now" closing technique help maintain a sense of urgency in closing a sale?
Offering limited time sales, price cuts, service enhancements (better product offerings essentially) can push buyer to buy it while the offer still lasts
What strategy can one use as a product is in the Decline stage? (p.78)
One can either (1) Focus on the efficient supply of a robust segment or (2) Divest
Kotler gives six criteria for one to do an effective competitive position and differentiation. What are they are why are they important? (p.161)
P-ACIDS!!! (1) Importance- a difference should create a highly valued benefit for significant numbers of customers. (2) Distinctive and pre-emptive- the difference cannot be easily imitated or performed better by others (3) Superior- the difference should provide a superior way for customers to obtain the benefit in question (4)) Communicable- the difference should be capable of being communicated to customers and understood by them (5) Affordable- the target customers can afford to pay for the difference. (6) Profitable- the difference will command a price adequate to make it profitable for the company.
What is a PEST or PESTLE analysis and what does it tell you about the Macro-environment? (p.56)
PESTLE tells you the marketing impact of change in the business environment and we will be in a position to respond. Second, we should also be alert to the fact that the nature of change facing organizations is itself changing.
What is the problem with being "stuck in the middle", a problem both Porter and Rossiter highlighted? (p.45-46 and Diverge p. 89)
Page 45-46: if you're stuck in the middle between cost leadership and differentiation, you have no room for growth in the market and no way to stand out against competitors. If you're not saving more costs than competitors and you're not unique compared to them, it's a losing game. Diverge: if you don't stand out from competitors, you're in the worst position. If a company tries to imitate competitors and doesn't leverage its own unique strengths, it is confusing to customers and there is no loyalty within or outside of the company. You need to embody the unique value proposition that your company offers.
How do the four P's of Marketing Mix contribute to strategy development? (p.47)
Products, price, promotion, and distribution is how the company translates a strategy into an effort in the marketplace. No one "P" can have decisions made about it in isolation from the rest of the mix; they should flow together and complement each other. Example: a premium positioning of a product, which differentiates it through superior quality, could be destroyed if strategized to be priced very low.
What are some examples of qualitative positioning research techniques? What insight do you get about the consumer with each method?
Qualitative research is conducted via: (1) Focus groups (2) In-depth interviews. Some examples of qualitative research techniques: - The brand or company as an animal or person - respondents asked to name person/animal that embodies their view of the product/company - Role-play - respondent is asked to assume role or behavior of another person - The friendly martian - interviewer assumes role of alien and asks members of group to explain a product and how it is used - Insight gained - images can be uncovered to show how brand/product/company is positioned in the mind of the respondent
Describe the Five Forces Model of Competition that Michael Porter outlined. What does it tell you about rivalry, power and the dynamic business climate? (p.68-72)
Rivalry among existing firms in the industry is in the middle, then there are threat of new entrants, threat of substitutes, bargaining power of buyers, and bargaining power of suppliers on the outside These forces tell you what drives competition in the industry and show how players may seek to alter balance of power toward themselves. Greater levels of competition will be present when: little differentiation between markets, low industry growth rates, high fixed costs, high supplier switching costs, low buyer switching costs, low entry barriers, high exit barriers
Give some examples of companies Rossiter says "have a right to disrupt" the market? (Diverge p. 70-71)
Rossiter lists examples of companies that have the right to be the leader in the market and are confident enough to do so. Examples include Uber (world's largest taxi company), Airbnb (world's largest accommodation provider), Facebook (world's most popular media owner), and Alibaba (world's biggest retailer). All of these companies focused on developing their brand and strengthening by focusing on their unique .1%
What are the benefits of segmentation and how does it help strategy development? (p. 182 -183)
Segmentation helps break down the market for correct strategizing and helps you to target more effectively. - 3 Ways to Segment: (1) Strategic segmentation (related to management concerns for strategic intent and mission) (2) Managerial Segmentation (concerned with planning and allocating resources such as budgets and personnel to market targets) (3) Operational segmentation (focuses on the issue to aiming marketing communications and selling efforts into the distribution channels that reach and influence market targets)
Balderton Investments used a young persons' focus group to gain insight into the trend in the teen market. What other research methods could they use? (p.105)
Since Balderton conducts group discussions with the teens, one additional method that Balderton Capital could use to gather this type of information is depth interviews. Balderton could conduct one-on-one interviews with each of the teens in order to do deeper probing of motivations and preferences for how the teens spend their money and time. - could also use quant methods like surveys and experiments to test marketing and get teens' opinions
How do "Suppliers" gain "power" and not become a commodity? (p.71)
Suppliers can gain power when there are very few suppliers and buyers are very fragmented. They can also gain power if the cost of switching suppliers is high - if the supplier has commodity products that can be bought elsewhere, the supplier doesn't have much power. Also, if they have differentiated products either through tangible differences in features or intangible through brand, reputation, etc. they have more power.
Rossiter describes the approaches of Target, Walmart and Kmart. How has each been successful and why or why not? (Diverge p.86-88)
Target focuses on being unique through boutique design and aesthetic expectation into mass merchandising. Walmart focuses on low prices. Kmart is stuck in the middle with no unique differentiation through cost, branding, experience, etc., so their potential customers don't know who they are.
(76) How gave Supply Chain expertise act as a great advantage for a marketing strategy development? (p.143-145)
The supply chain refers to the manner in which a product or service is delivered to a consumer including its distribution network, its distribution control, its weaknesses, and its pockets of strength.
What can a VCA - Value Chain Analysis - teach you about your competitors? (p.116-117)
The focus is on identifying 5 primary activities that add value to the final output of the company. The five areas are inbound logistics, operations, outbound logistics, marketing & sales, and service. - 3 main ways that it can provide insight into competitors: >> (1) Cost advantages that competitors may have because of their efficient manufacture, inbound or outbound logistics. >> (2) Many conventionally oriented companies perceive operations as their primary source of added value and therefore leave opportunities for competitors that take a more extended view of the value they can add in the customer's eyes. >> (3) Help locate economical ways of adding value to the customer: there are often numerous ways of achieving this, such as total quality being incorporated in the operations, thus reducing the service requirements and maybe adding to the appeal of the marketing and sales activity by offering extended warranties
What can you learn by doing competitive analysis? What can you learn from your competition? (p.126-127)
The goal is to learn from competitors - from their successes and their mistakes - as well as working out how to compete more effectively. Also, you can learn what your competitors are doing to be successful and what strategies they have implemented that have been either successful or unsuccessful
Puma's Marketing strategy was to build an image of being very conscious of sustainability in their packaging. Is this in line with the "marketing concept"? (p. 4-5)
The marketing concept holds that achieving organizational goals depends on determining the needs and wants of the target markets and delivering the desired satisfactions more effectively and efficiently. Puma is addressing the marketing concept because they recognize consumers' environmental concerns; so, the company made an effort to reduce cardboard used in the shoe boxes and its footwear and clothing lines are being made from recycled products. This is what the consumer is asking for.
Culture, Strategy and Tactics are simultaneously merged into the new marketing paradigm. How does reality of the marketing function fall short in many organizations? (p.7)
The marketing function falls short because it simultaneously is all three of these things which is very complex and challenging (building customer orientation within a company - culture, developing value proposition and positioning - strategy, and detailed marketing plans - tactics).
Strategic planning attempts to answer three questions. Why does a Marketing strategist look for effectiveness over efficiency? (p.29)
The three questions are: (1) what is the business doing now? (2) what is happening in the environment? (3) what should the business be doing? - Effectiveness > efficiency because effectiveness is doing the right things and efficiency is doing things well
Why does Brand Loyalty and Innovation in the purchasing process vital to understand when segmenting a market? (p 174)
There are two types of purchasers: (1) brand loyal - repeat purchases of the same products (2) innovators - like to buy products when they are new, hard to find as they are not consistent in each product
How do marketing teams use "Personas" to segment groups within a life cycle? (p.170)
These personas help companies define the family-type or person (whether it be bachelor, newly wed, full nest (i, ii, iii), empty nest (i, ii,iii) solitary survivor (working or retired). By doing this, companies can start making lists (some already exist) as to what each type of person/group usually needs or buys.
Cirque du Soleil found their .1% of the DNA and achieved great growth and success. What was their success formula? (Diverge p. 37-38)
They deviated from the norm in the circus industry and instead of targeting families who may pay $85, they targeted upscale adults for refined entertainment for $175. They had world-class acrobats, music, and lighting. They focused on the experience and not the price. Cirque du Soleil set itself apart by deviating and focusing on a specific, lucrative segment by altering its offering.
Kodak developed a new target marketing campaign. How did Social Media help them understand their target market? (p.214)
They targeted young women with families who it sees as the guardians of the household photo album -new campaign focused on range of cameras that make it easy to email a photo or post on FB - Kodak is active in social media with employees dedicated to listening to customers on Twitter and FB - campaign combined emotional hit of TV with online engagement - sentimental ads work!
How do Market Factors affect the attractiveness of Markets? (p. 220-222)
Things like the size, the growth rate, the life cycle stage, the price elasticity, bargaining powers of buyers, etc. affect how beneficial a market might be and if it's not worth the time investment
The Amadeus Marketing model provided value for their customers. What advantages for the industry did they provide? (p.88-89)
This company creates most of its value from collecting, recognizing, and working to satisfy the needs of specific consumers. Amadeus is working on improving personalization of products and services to fit the needs of certain consumers groups using aggregated consumer data.
What is the best way to predict a competitor's future strategies? (p.120-122)
To determine competitors' response profiles - that is, a guide to how a competitor might behave when faced with various environmental and competitive changes.
Why is it important to do a "Situational Analysis" as the first step in developing a Strategic Plan? (p. 59-62)
To determine the demographic changes (rising life-expectancy), youth market trends (they are more affluent, have a disposable income), changing lifestyle and living patterns (increase in single-person households, grow in female employment, the world demands healthier food), multi-ethnic societies (minorities are a growing number of the population and are very vocal about what they disapprove in in being advertised to) , and the grey market (over 60 year olds make up 23 percent of the population and are relatively rich) of a business.
How does the creation of competitive positioning occur and what is a recommended process? (p.43)
Two things: (1) select market targets - assess market attractiveness and evaluate company's strengths in that market (where it will compete) and (2) differential advantage - should be of value to customer and should be hard for competitors to copy (how it will compete)
What is the VALS approach to segmentation and what does it say about the "Lifestyle characteristics" of a segment? (p.172)
VALS segments US adults into eight distinct types—or mindsets—using a specific set of psychological traits and key demographics that drive consumer behavior. The US Framework, a graphic representation of VALS, illustrates the eight types and two critical concepts for understanding consumers: (1) primary motivation and (2) resources. The combination of motivations and resources determines how a person will express himself or herself in the marketplace as a consumer. - Using VALS provides clients with: >>A fresh perspective by effectively "putting them inside the head" of their customers >>Rich, customized, consumer profiles or personas >>Distinctive communication styles of their best targets.
What are the six key questions one should ask about their customers to gain insight? (p.91)
WHO/WHAT/WHEN/WHERE/WHY/HOW (Who is involved in buying and consuming? What are their choice criteria? When do they buy/use the product? Why do they buy/use the product?Where do they buy? How do they use the product?)
How has the "power" of choice shifted to the customer and consumer with globalization, trade and manufacturing improvements over the past 15 years? (p.5)
With improvements in globalization, trade, and manufacturing, industry supply has increased with a decrease in barriers to entry. This gives consumers more bargaining power and more options. In addition, the increase in information available (internet!) has given customers more power. Consumers are also demanding more so they have more power when it comes to selecting and purchasing.
Jaeger created the Boutiques by Jaeger to reach a different audience. Were they successful and what else should they have done? ( p. 158)
Yes, they targeted a new, younger audience that still shopped even when they were shorter on money. They also could have made a line of clothing for adults that wanted to save money so that they had affordable clothing for an older audience, not just youth.
