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| the process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods, and services to create exchanges that satisfy individual and organizational objectives. |
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| * Even terrorism considered a marketing activity |
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| finding out what consumers want then providing it to them. |
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| Organizations marketing department (1st task) |
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| discover consumer needs --> information about needs --> potential consumers: the market |
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| SATISFYING consumer needs |
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2nd task organization
4 P's |
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discover consumer needs --> satisfy by creating an offering with right combo of
1. Product
2. Price
3. promotion
4. place |
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| learn about marketing, get course credit |
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| meet friends, business partners |
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| feeling good about learning or excelling |
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| time spent in class/studying |
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| stress of studying and listening to instructor |
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| expending energy walking to class or getting sick from lectures |
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| Analyzing the Market Environment |
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businesses respond to the demand in a variety of ways.
Ex: diet industry
-"low carb trend"
-healthier fast food options
-24/7 gyms
-shape ups shoes |
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| The immediate environment |
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<-- competition (CONSUMERS) --> corporate partners V
Company |
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| Macro-environmental Factors |
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(consumers) -->
- Culture
- Political/legal
- economic
- demographics
- social trends
- technology |
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| 3 phases of a Strategic Marketing Plan |
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| 1. Mission - defining mission and/or vision 2. Environmental Analysis 3. Segmentation, Targeting, Positioning |
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Industry Profitability Dependent On...
1. Industry Competitiveness
2. Availability of Substitute Products
3. Potential Entrants
4. Supplier Power
5. Buyer Power |
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Industry Competitiveness
Intensity |
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Low intensity = higher profitability
Industry has low intensity when few firms are competing
Ex: commercial aircraft and oil |
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| Availability of Substitutes |
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few/no substitutes = higher profitability
Ex: gas, proprietary drugs
Examples of many substitutes = fresh veggies, technological products, (tea, energy drinks for coffee)
** coca-cola leading in industry but not when considering many other alternatives |
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| Threat of Potential Entrants |
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High Barriers to entry = higher profitability
Ex: Auto Industry |
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| Low bargaining power of suppliers/ Buyers = higher profitability |
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| Low Bargaining Power when... |
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-high number
- low information
Ex:
low supplier power = computer industry
low buyer power = medical services (patients) |
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| sustainable competitive advantage |
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an advantage versus competition that can be maintained consistently over time.
- difficult to maintain/sustain today |
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| What is McDonalds sustainable competitive advantage? |
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| Macro strategies for developing customer value |
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| (customer value) --> Product excellence, Customer excellence, Operational excellence |
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| achieving effective branding and positioning |
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| retaining loyalty with excellent customer service |
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| efficient operations, excellent supply chain manual |
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In class "adding value" ex:
Virgin Atlantic's Customer Service |
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| Focused on service - 3 tiers of service -even lowest tier offers increase service |
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| Ansoff's Product/market expansion grid |
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Definition
1. Market penetration
2. market development
3. product development
4. diversification
Ex: when FedEx bought Kinkos
- RJ Reynolds (cigs) bought Nabisco |
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| Hypothetical Market Structure and Strategies |
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| Market Leader (Budweiser,expand market, defend market share) --> Market Challenger (Miller: attack leader quo) --> Market follower (imitate) --> Market Nicher (specialize) |
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Chongquing Auto Co. - rapid growth
slides from China, India, and Thailand trip |
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Product development = main focus
Product excellence = focused on product; not as many companies focus on product excellence as much as Apple! |
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the process of dividing the total market for a good or service into several smaller, internally homogenous groups
- based on characteristics |
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b/c customers in market have differences in buying habits, in the way they use goods/services, and different motives for buying.
Ex: toothpaste - some for fresh breath, whitening, or cavities |
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| NEVER PRACTICE MASS MARKETING! |
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| Segmentation allows managers to: |
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- visualize prospective customers in designing a marketing mix
-concentrate their resources on only 1 or a few market segments
Ex: mexican food restaurants in CoMo need to target to mexi food fans but also the geographic area |
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- Identify current and potential needs/wants within a market
- Identify distinguishing characteristics among segments
- determine the potential for the segments and how well they are being satisfied |
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| Types of Market Segmentation (5) |
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Demographic (ex: movie theatre pricing for diff. demographics)
Purchase Behavior
- Usage (light, medium, heavy users)
- loyalty status (brand loyal or variety seeker)
- user status (users vs. nonusers/former users
Geographic (ex: fast food - In/Out)
Psychographic = attitudes and lifestyles (ex: energy drinks, going green)
Benefit: importance of particular product benefit |
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| Geodemographic Segmentation |
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| By zip codes, stereotyping |
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- Buying behavior of a segment is rarely traceable to a single characteristic (ex: denture cream/age)
- The first segmentation characteristic chosen should be the one that provides the clearest and most distinctive division of the market
- The marketer should be aware of the interrelationships among segmentation characteristics |
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| Apple iPod/iPhone different types of segmentation |
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demographic, benefit
geographic: where stores are located (urban) |
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| Target Marketing Approaches |
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- Mass marketing (no segmentation) SHOULD NEVER BE PRACTICED, 1 product for all customers, doesn't exist anymore
- Niche marketing: one product for one segment
- Differentiated Marketing: multiple products for multiple segments (honda automobiles)
- Individualized (customized) marketing: ex: dell computers |
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| Who is in their market? Are the segments unique? Does each segment require a unique marketing mix? : factors that have to be satisfied in order to have a profitable target market |
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- size matters
- too small and it i insignificant
- not profitable
ex: dentures; some young people might need them but not a huge market |
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Responsive
Customer Must: |
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-react positively to firm's offering
- move toward the firms products/services
- accept the firm's value proposition
Ex: Tri Delts marketing/targets smart girls but don't have the right atmosphere for studying and party instead |
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| Effective Segmentation and Targeting Leads to Profitability |
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Identifiable +
Substantial +
Reachable +
Responsive +
= Profitable |
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Goal Positioning
-Brand Essence |
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Abstracted benefits that relate to consumer goal
Ex: Herbal Essences orgasm commercial
Laddering Up: Personality dimensions
Laddering Down: show reason to believe a benefit in order to enhance competitive based positioning
ex: Show reason why product has benefit (Kevin's fast food promotes fresh ingredients which contradicts old ads) |
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Dove Campaign for real beauty
4. Sincerity/authenticity
3. No promises/reveal true self
2. Natural and clean
1. basic/simple soap |
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Ford F150 super duty
1. Ford F150
2. Tough/rugged
3. Powerful engine
4. 6.4 Liter diesel |
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