299
Marketing SM I
Introduction and Overview
J. Robb Dixon Based on lectures by Peter Arnold and Phyllis McGinnis Spring 2006
Fusing the ART, SCIENCE, and TECHNOLOGY of Business.
Do you know?
A. B. C. D. E. Tastes great less filling Bud Lite Miller Lite Diet Coke Twinkies Florida oranges
Fusing the ART, SCIENCE, and TECHNOLOGY of Business.
Do you know?
1. 2. 3. 4. 5. 6. 7. 8. 9. 10. Diamonds are forever (DeBeers) Just do it (Nike) The pause that refreshes (Coca-Cola) Tastes great, less filling (Miller Lite) We try harder (Avis) Good to the last drop (Maxwell House) Breakfast of champions (Wheaties) Does she ... or doesn't she? (Clairol) When it rains it pours (Morton Salt) Where's the beef? (Wendy's)
advertisingage.com
Fusing the ART, SCIENCE, and TECHNOLOGY of Business.
Marketing
"Marketing is not about process...
Marketing is about Ideas..."
Carl Ally, Ally & Gargano
"Find a need and fill it"
Peter Drucker
"Positioning, the battle for your mind"
Trout & Ries
Fusing the ART, SCIENCE, and TECHNOLOGY of Business.
Positioning How and for what will you compete?
General Breadth of Product Line
Low Product Service Quality
High Product Service Quality
Specialized Breadth of Product Line
Fusing the ART, SCIENCE, and TECHNOLOGY of Business.
Marketing
Positioning = Strategy
Product Place Promotion Price
= Tactics
Fusing the ART, SCIENCE, and TECHNOLOGY of Business.
Functions of Marketing
Buying Selling
Market Information
Risk Taking Marketing Department
Transporting Storing
Financing
2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Standardization & Grading
Fusing the ART, SCIENCE, and TECHNOLOGY of Business.
Marketing's Role Has Changed Over Time
Production Era
Focus: Increase Supply
Sales Era
Marketing Department Era Marketing Company Era
Beat Competition
Coordinate and Control
Long-Run Customer Satisfaction
2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Fusing the ART, SCIENCE, and TECHNOLOGY of Business.
The Marketing Concept
Customer Satisfaction Total Company Effort
The Marketing Concept
Profit
2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Fusing the ART, SCIENCE, and TECHNOLOGY of Business.
Marketing Concept & Customer Value
Take Customer's Point of View
Customer May Not Dwell On Value
Costs
Benefits
Where Does Competition Fit? Customer Value Builds Relationships
2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Fusing the ART, SCIENCE, and TECHNOLOGY of Business.
Putting It All Together
Superior Customer Value
Total Company Effort to Satisfy Customers Customer Acquisition
Profitable Relationships with Customers Customer Retention
2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Customer Satisfaction
Fusing the ART, SCIENCE, and TECHNOLOGY of Business.
What is Market Strategy Planning? What are Marketing Tactics?
The C in the middle of this figure stands for: The a) Content marketing b) Completeness c) Consistency d) Customer C e) Center
mix
2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Fusing the ART, SCIENCE, and TECHNOLOGY of Business.
Selecting a Market-Oriented Strategy is Target Marketing
Production-oriented manager sees everyone as basically similar and practices "mass marketing"
Marketing-oriented manager sees everyone as different and practices "target marketing"
Fusing the ART, SCIENCE, and TECHNOLOGY of Business.
2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
An Application of Target Marketing
+
Fusing the ART, SCIENCE, and TECHNOLOGY of Business. 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Which of these P-words is not one of the four Ps?
a) b) c) d) e) Product Place Position Promotion Price
Fusing the ART, SCIENCE, and TECHNOLOGY of Business.
Markets Developing Marketing Mixes for Target
Product
C Price
Place
Promotion
2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Fusing the ART, SCIENCE, and TECHNOLOGY of Business.
Marketing Mix - Price
Price of Other Products In the Line Competition and Substitutes Price Sensitivity Cost and Demand
Pricing Objectives
Price Flexibility
Price Changes Over the Life Cycle
Price Setting
Discounts and Allowances Geographic Pricing Terms
Fusing the ART, SCIENCE, and TECHNOLOGY of Business.
Legal Environment
2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Marketing Mix Place, Distribution "Direct or Indirect...that is the question"
Examples of Channels of Distribution
Google Toyota Del Monte
Procter & Gamble
Wholesaler
Wholesaler
Wholesaler
Retailer
Retailer
Retailer
Consumer
2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Fusing the ART, SCIENCE, and TECHNOLOGY of Business.
Marketing Mix - Promotion
Personal Selling Telling and Selling the Customer Sales Promotion
2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Advertising
Publicity
Fusing the ART, SCIENCE, and TECHNOLOGY of Business.
Product
The good or service that is offered has basic functionality and features. It may be offered in one or multiple varieties.
But, not just the good or service you offer, but a much broader definition to include warranties, after-sales service, installation, and image.
Fusing the ART, SCIENCE, and TECHNOLOGY of Business.
Product Levels
Installation & Packaging Labeling
Augmented Product
Brand Name Delivery & Credit Quality
Features
Core Benefit Or Service
AfterSale Service Styling
Warranty Actual/Expected Product Core/Generic Product
Fusing the ART, SCIENCE, and TECHNOLOGY of Business.
All Four P's Contribute to the Whole
Product Price Place Promotion
Position
Selection of Target Market
2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Fusing the ART, SCIENCE, and TECHNOLOGY of Business.
Classification of Consumer Goods
Basis of comparison
Product Price Place Type of Consumer Good
Convenience Toothpaste, cake mix, hand soap, laundry detergent Relatively inexpensive Widespread; many outlets Shopping Specialty Unsought Cameras, TV's Rolls Royce Burial briefcases, cars, insurance, appliances, Rolex watches thesaurus clothing Fairly expensive Usually very expensive Varies Often limited
Large number Very limited of selective outlets
Promotion
Price, availability, and awareness stressed
Differentiation Uniqueness of Awareness is from brand and essential competitors status stressed stressed
Fusing the ART, SCIENCE, and TECHNOLOGY of Business.
Classification of Consumer Goods
Basis of comparison Type of Consumer Good
Convenience Shopping Prefer specific brands, but will accept substitutes
Infrequent purchases; comparison shopping; uses decision time
Specialty Very brand loyal; will not accept substitutes
Infrequent purchases; extensive time spent to decide and get the item
Unsought Will accept substitutes
Very infrequent purchases; some comparison shopping
Aware of Brand loyalty brand, but will of consumers accept substitutes Purchase behavior of consumers
Frequent purchases; little time and effort spent shopping; routine decision
Fusing the ART, SCIENCE, and TECHNOLOGY of Business.
Consumers Buy Benefits Not Features
Consumers buy:
Consistency, convenience
McDonald's
Fun, hip, cool
Reef Flip - Flops, Pacific Sunwear of CA
Aspirational, escape, illusion
Jimmy Buffet, Grateful Dead, Jaguar, Maxim, Cosmopolitan
Cleanliness, brightness, freshness
Tide Detergent
Timeliness, safety SwissAir, Airport Security
Fusing the ART, SCIENCE, and TECHNOLOGY of Business.
Questions to Ask About Consumers
Who are they? What do they buy? How do they choose? Why do they select a product? Where do they buy it? When do they buy it?
Fusing the ART, SCIENCE, and TECHNOLOGY of Business.
Do you drink coffee?
Do you regularly drink coffee? Sorry, I mean, do you buy coffee more than twice per week?
If yes, which of the following is most a. Yes to you when you purchase coffee? important b. Price a. No b. Convenience c. Variety d. The coffee
Fusing the ART, SCIENCE, and TECHNOLOGY of Business.
Consumers Have Different Needs
Market: Aggregate of people who, as
individuals or as organizations, have needs for products in a product class and who have the ability, willingness, and authority to purchase such products
Segment: Group of individuals, groups,
or organizations that share one or more similar characteristics which make them have relatively similar products needs and have high probability of responding to a similar marketing mix
Segmentation: Process of identifying
segments or groups of people / orgs. that exist within the larger market
Fusing the ART, SCIENCE, and TECHNOLOGY of Business.
Approaches to Serving Markets
Approach
Mass Marketing Description
A single marketing mix for the entire market
A single marketing mix for one segment of the market (Concentrated Marketing)
Examples
Commodity products
Women's Workout World (exercise facilities for women); American Association for Retired Persons (lobbying and membership services for people over 50) McDonald's (Happy Meals for young children, Big Macs for Teens, Arch Deluxe for adults); Toshiba copiers (several sizes and features to meet different levels of business needs)
Segment marketing
Separate marketing mixes for two or more segments of the market (Multisegment Marketing)
Individual marketing
A marketing mix customized for an individual or organization
Personalized amenities for repeat guests at Ritz-Carlton hotels; management consulting services tailored to an organization's needs
Fusing the ART, SCIENCE, and TECHNOLOGY of Business.
How to Segment Consumer Markets
Geographic Demographic Behavioral / Product Usage
Common Bases for Segmenting Markets
Psychographic
Fusing the ART, SCIENCE, and TECHNOLOGY of Business.
Elements of the marketing mix that compose a cohesive marketing program
Marketing manager
Product
Features Brand name Packaging Service Warranty
Price
List price Discounts Allowances Credit items Payment period
Promotion
Advertising Personal selling Sales promotion Publicity
Place
Outlets Channels Coverage Transportation Stock level
Cohesive marketing mix
Product
Promotion Promotion
Place Place
Price
Fusing the ART, SCIENCE, and TECHNOLOGY of Business.
Steps in Segmentation, Targeting, & Positioning
6. Develop Marketing Mix for Each Segment
5. Develop Positioning for Each Segment 4. Select Target Segment(s) 3. Develop Measures of Attractiveness 2. Develop Profiles of Segments
Market Positioning
Market Targeting
Market Segmentation
1. Identify Bases for Segmentation
Fusing the ART, SCIENCE, and TECHNOLOGY of Business.