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1 Marketing in a Changing World.........................................................................................................................5 1.1 Marketing Model – Core concepts........ ... ....................................................................................................................5 1.2 Marketing management.............................................................................................................................................6 1.3 Marketing concepts...................................................................................................................................................8 1.4 Challenges in the new connected millennium...........................................................................................................9 2 Strategic Planning and the Marketing Process................................................................................................10 2.1 Strategic planning process......................................................................................................................................10 2.2 Marketing process...................................................................................................................................................12 3 The Marketing Environment.............................................................................................................................15 3.1 Overview.................................................................................................................................................................15 3.2 Microenvironment...................................................................................................................................................15 3.3 Macroenvironment..................................................................................................................................................17 3.4 Responding to marketing environment...................................................................................................................19 4 Marketing Research and Information Systems................................................................................................20 4.1 General....................................................................................................................................................................20 4.2 Marketing information system (MIS)......................................................................................................................20 4.3 Marketing research process.....................................................................................................................................21 4.4 Other marketing research considerations................................................................................................................24 5 Consumer Markets and Consumer Buyer Behavior.......................................................................................25 5.1 Model of consumer behavior .................................................................................................................................25 5.2 Characteristics affecting consumer behavior.......................................................................................................... 25 5.3 Types of buying decision behavior.........................................................................................................................29 5.4 The buyer decision process.....................................................................................................................................30 5.5 The buyer decision process for new products.........................................................................................................30 5.6 Consumer behavior across international borders....................................................................................................31 6 Business Markets and Business Buyer Behavior.............................................................................................32 6.1 Overview.................................................................................................................................................................32 6.2 Business buyer behavior.........................................................................................................................................33 6.3 Institutional and government markets.....................................................................................................................35 7 Market Segmentation, Targeting, and Positioning for Competitive Advantage...........................................36 7.1 Overview.................................................................................................................................................................36 7.2 Market Segmentation..............................................................................................................................................37 7.3 Market targeting......................................................................................................................................................39 7.4 Positioning for competitive advantage....................................................................................................................40 8 Product and Services Strategy...........................................................................................................................43 8.1 What is a product?..................................................................................................................................................43 8.2 Product classifications.............................................................................................................................................44 8.3 Individual product decisions...................................................................................................................................46 8.4 Product line decisions.............................................................................................................................................49 8.5 Product mix decisions.............................................................................................................................................50 8.6 Services marketing..................................................................................................................................................51 8.7 International product and services marketing.........................................................................................................52 9 New-Product Development and Product Life-Cycle Strategies......................................................................53 9.1 New product development strategy.........................................................................................................................53 9.2 Product life-cycle strategies....................................................................................................................................56 10 Pricing Products: Pricing Considerations and Approaches..........................................................................59 10.1 Introduction...........................................................................................................................................................59 10.2 Factors to consider when setting prices........................................................ ........................................................59 10.3 General pricing approaches...................................................................................................................................62 11 Pricing Products: Pricing Strategies...............................................................................................................64 2 / 126 Downloaded by Brian Dytioco ([email protected]) lOMoARcPSD|6700157 Principles of Marketing 11.1 New-product pricing strategies.............................................................................................................................64 11.2 Product mix pricing strategies...............................................................................................................................64 11.3 Price adjustment strategies....................................................................................................................................65 11.4 Price changes........................................................................................................................................................68 11.5 Public policy and pricing......................................................................................................................................69 12 Distribution Channels and Logistics Management........................................................................................71 12.1 The nature of distribution channels.......................................................................................................................71 12.2 Channel behavior and organization.......................................................................................................................72 12.3 Channel design decisions......................................................................................................................................74 12.4 Channel management decisions............................................................................................................................76 12.5 Public policy and distribution decisions...............................................................................................................76 12.6 Physical distribution and logistics management...................................................................................................77 13 Retailing and wholesaling.................................................................................................................................80 13.1 Retailing................................................................................................................................................................80 13.2 Retailer marketing decisions.................................................................................................................................83 13.3 The future of retailing...........................................................................................................................................84 13.4 Wholesaling..........................................................................................................................................................85 13.5 Wholesaler marketing decisions...........................................................................................................................86 13.6 Trends in wholesaling...........................................................................................................................................87 14 Integrated marketing communications strategy.............................................................................................88 14.1 The marketing communications mix.....................................................................................................................88 14.2 Integrated marketing communications..................................................................................................................88 14.3 A view of the communication process..................................................................................................................89 14.4 Steps in developing effective communication.......................................................................................................90 14.5 Setting the total promotion budget and mix..........................................................................................................93 14.6 Socially responsible marketing communication....................................................................................................95 15 Advertising, sales promotions, and public relations......................................................................................96 15.1 Advertising............................................................................................................................................................96 15.2 Sales promotion..................................................................................................................................................100 15.3 Public relations....................................................................................................................................................101 16 Personal selling and sales management.........................................................................................................103 16.1 Role of personal selling.......................................................................................................................................103 16.2 Managing the sales force.....................................................................................................................................103 16.3 Principles of personal selling..............................................................................................................................105 17 Direct and online marketing: the new marketing model.............................................................................108 17.1 What is direct marketing?...................................................................................................................................108 17.2 Benefits and growth of direct marketing.............................................................................................................108 17.3 Customer databases and direct marketing...........................................................................................................109 17.4 Forms of direct marketing...................................................................................................................................109 17.5 Online marketing and electronic commerce........................................................................................................110 17.6 Integrated direct marketing.................................................................................................................................112 17.7 Public policy and ethical issues in direct marketing........................................................................................... 112 18 Competitive strategies.....................................................................................................................................113 18.1 Customer relationship marketing........................................................................................................................113 18.2 Competitive marketing strategies........................................................................................................................115 18.3 Balancing customer and competitor orientations................................................................................................118 19 The global marketplace..................................................................................................................................119 19.1 Global marketing in the twenty-first century......................................................................................................119 19.2 Looking at the global marketing environment....................................................................................................119 19.3 Deciding whether to go international..................................................................................................................121 19.4 Deciding which markets to enter.........................................................................................................................121 19.5 Deciding how to enter the market.......................................................................................................................121 19.6 Deciding on the global marketing program.........................................................................................................122 3 / 126 Downloaded by Brian Dytioco ([email protected]) lOMoARcPSD|6700157 Principles of Marketing 19.7 Deciding on the global marketing organization..................................................................................................123 20 Marketing and society: social responsibilities and marketing ethics..........................................................124 20.1 Social criticisms of marketing.............................................................................................................................124 20.2 Citizen and public actions to regulate marketing................................................................................................124 20.3 Business actions toward socially responsible marketing....................................................................................126 4 / 126 Downloaded by Brian Dytioco ([email protected]) lOMoARcPSD|6700157 Principles of Marketing 1 Marketing in a Changing World 1.1 Marketing Model – Core concepts Marketing Five core concepts – Needs, wants, demands – Products and services – Value, satisfaction, quality – Exchanges, transactions, relationships – Markets Definition of marketing – A social and managerial process whereby individuals and groups obtain what they need and want through creating and exchanging products and value with others – Simple definition – Deliver customer satisfaction at a profit – By: (1) attracting new customers by promising superior value, and (2) keep current customers by delivering satisfaction Scope of marketing – Book has a broad scoping: R&D, communcation, distribution, pricing, service – Also buyers carry on marketing activities – e.g. by searching for goods Main elements of a modern marketing system – value added in steps – Suppliers – Company (marketer) + competitors – Marketing intermediaries – End user market Needs, wants, demands Needs – States of felt deprivation, part of human makeup – Physical and social needs Wants – The form needs take (e.g. food => hamburger) – Shaped by culture and personality Demands – When wants are backed by buying power Products and services Products – Anything that can be offered to satisfy a need or a want – Physical products, services, experiences, persons, places, organizations, information, ideas – Example: “smoking is bad” idea can be a product, a person can be a product in an election – Aka: satisfier, resource, marketing offer Services – Just one kind of a product 5 / 126 Downloaded by Brian Dytioco ([email protected]) lOMoARcPSD|6700157 Principles of Marketing Value, satisfaction, quality (Customer) Value – Difference between “value gained by owning and using a product” and “cost of obtaining the product” – Value gained not necessarily monetary – Similarly cost of obtaining not necessarily monetary – Customers act on perceived value [and perceived cost] (Customer) Satisfaction – Perceived performance relative to expectations Quality – Closely related to satisfaction – Narrow definition: no defects – Broad definition: ability to satisfy customer needs [circular definition!] Exchange, transactions, relationships Exchange – Obtaining a desired object from someone by offering something in return – Offerings could be money, product, service, ... Transaction – A trade of values between two parties; marketing's unit of measurement! – Monetary transactions and barter transactions Relationship (Marketing) – Going beyong short term transactions – Long-term relationships with valued customers, partners, etc – Marketing network – company and all its supporting stakeholders Markets Market – Economist's definition – Place (virtual or physical) where buyers and sellers meet Market – Marketer's definition – The set of actual and potential buyers of a product – The sellers of a product are labeled as the “industry” Industry – Marketer's definition – The sellers of a product 1.2 Marketing management What is marketing management Book definition – Analysis, planning, implementation, and control of programs designed to – ... create, build, and maintain beneficial exchanges with target buyers – ... for the purpose of achieving organizational objectives = Finding and increasing (sometimes decreasing) demand = Demand management Demarketing To shift or reduce demand, not destroy it 6 / 126 Downloaded by Brian Dytioco ([email protected]) lOMoARcPSD|6700157 Principles of Marketing Profitable customer relationships Two categories of demand – New customers – Repeat customers Traditional focus – attract new customer, transactions Modern focus – retain profitable customers, build lasting relationships Customer lifetime value of a Taco Bell customer > $12,000 ! Practice Three stages – Entrepreneurial marketing – Individuals who live by their wits, knock on doors etc – Formulated marketing – Marketing department, adopt tools of marketing – Intrepreneurial marketing – Maturing company – Need internal entrepreneurship to avoid stagnation – Get out of office, go into customer's lives, etc 7 / 126 Downloaded by Brian Dytioco ([email protected]) lOMoARcPSD|6700157 Principles of Marketing 1.3 Marketing concepts Production concept Customer – Favor products that are available and affordable Goal – Improve production and distribution efficiency Usefulness – Demand exceeds supply – Product cost is too high, pressure to decrease Risk - [What to do when situation changes?] Product concept Consumer – Favor products with best quality, performance, innovative features Goal – Improve product features in a continuous fashion Userfulness – [If market is stable, no competing technologies in sight] Risk – Competing technology (spray instead of mouse trap) enters market Selling concept Consumer – Will not buy enough products unless seller(s) undertake large-scale promotion and selling effort Goal – Promote product, coax people into buying Usefulness – Unsought goods – encyclopedias, insurance, ... Risk – Dissatisfied customers – will not buy again, will tell 10 people! “Inside out” Marketing concept Customer – Buys product that best satisfies needs and wants Goal – Determine needs and wants of target markets – Deliver the desired satisfaction more effectively and efficiently than competitors Risk – Short term focus w.r.t. larger social and ethical issues – Overlooks long term customer welfare (fast food) Customer driven marketing – When customers know what they want Customer driving marketing – When customers do not yet know they even need something – Meeting existing latent and future needs by understanding customers better than they understand themselves – GSM networks, CD players, ... “Outside in” 8 / 126 Downloaded by Brian Dytioco ([email protected]) lOMoARcPSD|6700157 Principles of Marketing Social marketing concept Goal – Balance (1) Consumer satisfaction in short and long term, (2) society, (3) company profits 1.4 Challenges in the new connected millennium Connections Connecting technologies – Computer, Information – Communication, Transportation ... which connect – Customers – More selective, more direct [salad bowl customer base] – Connecting for life – Marketing Partners – Other departments, supplies and distributors – Strategic alliances – World around us – Global, broadened connections – Values and responsibilities Supply chain management = Connecting with partners Supply chain = raw materials to components to final products to final buyers SCM = strengthening and optimizing the chain – Streamline logistics – Reduce joint distribution costs – ... Strategic alliences 1) Marketing alliance (joint marketing) 2) Product or service alliance (carry / license other product) 3) Promotional alliance (join in a promotion) 4) Pricing alliance (join forces for mutual discounts) 9 / 126 Downloaded by Brian Dytioco ([email protected]) lOMoARcPSD|6700157 Principles of Marketing 2 Strategic Planning and the Marketing Process 2.1 Strategic planning process Strategic planning process Define the company's mission (mission statement) – Mission statement = statement of purpose, what do we want to accomplish – Requirements – Market oriented (in terms of satisfying customer needs) – Realistic (not too narrow or broad) – Specific – Fit the market environment – Base on distinctive competences – Motivating Set company objectives and goals – Mission turned into detailed supporting objectives and goals for each level of company management – For instance – Spend 15% of profits into R&D to achieve X – Sell more or reduce costs to cover costs = marketing goal – Broad marketing strategies to cover (broad) marketing goals – Through more salespeople or more advertisting, etc. – “Increase market share by 20% by end of third year” 10 / 126 Downloaded by Brian Dytioco ([email protected]) lOMoARcPSD|6700157 Principles of Marketing Design the business portfolio – Process – Analyze current portfolio (SBU = strategic business unit) – Develop growth strategies to modify portfolio – Best portfolio – Best fits the company's strengths and weaknesses ... – ... to threats and opportunities in the environemnt – Methods – BCG (relative market share vs. market growth) – GE (business strength, industry attractiveness; indexes) – Problems – Difficult to define SBUs and measure market share/growth – Focus on current business, not future – Overemphasis on market share and growth, not capabilities – Product-market expansion grid – New vs. existing markets – New vs. existing products – => Four basic approaches – market penetration – market development – product development – diversification Planning, marketing, and other functional strategies – Use company strategy as input, developt functional plans – Marketing, finance, accounting, purchasing, manufacting, IT, HR, ... – Role of marketing – Guiding philosophy – the marketing concept – Input to strategic planners, to see and exploit opportunities – Carry out unit objectives profitably – Cross-Functional conflict – Marketing and other functions should be in harmony – Optimizing one function may have adverse effects on others – Du Pont “adopt a customer” approach Small businesses Often overlooked, rationale e.g. – No time, “fires to extinguish” – We've done good so far – Market is changing so rapidly p [Show More]

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