MKT 100 Lecture Notes - Lecture 13: Ipod Nano, Ipod Shuffle, New Product Development

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4 Aug 2016
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MKT100 Exam Notes
Marketing Mix & Strategy
Marketing Strategy: identifies a firm’s target market related to the marketing mix (4 P’s) and the
basis on which the firm plans to build a sustainable competitive advantage
Marketing Mix (4P’s): the most important elements of any marketing strategy & the tools a marketer
uses most often
Product (creating value) – creating value by designing products and services that meets the wants
and needs of the customer
Price (transacting value) – choosing the right price strategy; high (skimming), low (penetrating) or
meeting the competition
Place (delivering value) – marketing channels that are used to move product from the manufacturer to
the end user; supply chain tactics, strategies and logistics
Promotion (communicating value) – integrated marketing communication (IMC); coordination of all
promotional tools towards delivering one message
Marketing Plan
Marketing Plan: written document composed of an analysis of the current marketing situation
Planning Phase: marketing executives and top managers define the mission and objectives and
evaluate how people in and out of the organization affect the firms potential for success
1. Define business mission and objectives
2. Conduct a situation analysis; SWOT analysis, assess uncertainties in the marketplace due to
Cultural, Demographic, Social, Technological, Economic and Political forces (CDSTEP)
Implementation Phase: marketing managers identify and evaluate different opportunities by
segmentation, targeting and positioning. Then develop the marketing mix using 4 P’s
Control Phase: the part of the strategic marketing planning process when managers evaluate the
performance of the marketing strategy and take any necessary corrective actions
Macro-environment
Business environment
Laws
Money
Trends
Technology
Business Life Cycle
Concept and Start-up  Growth  Maturity  Decline  Death
Growth – must be conscious of external environment to be successful in ramping up
production to meet demands and protect its share in the market as competitors enter
Maturity – has to be aware of larger market place to ensure its place among the market and
consumers
PEST
Political-Legal – laws and regulations each individual must follow, dependent on the political system
in which the business operates
New product development – barriers to development
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Attractiveness to investors – more standards = less attractive & longer to realize ROI
Potential size of market – restriction of access to product
Positioning of product – trade barriers
Pricing of product – licenses protect sale of product
Economic
Recession & Inflation
Luxury vs necessity
Consumer behavior
Businesses
Access to capital
Choice of suppliers and/or buyers
Consumers
Discretionary Income
Appeal of luxury products
Shopping habits
Attitudes and Beliefs – the economic environment has an intangible impact on attitudes and beliefs
about how the economy is going which is sometimes greater than tangible factors; sales, revenue,
wages.
Socio-Cultural
Gender – more women in workforce = more convenience products
Ethnicity – multiculturalism, encouraging maintenance of culture w/ Canadian norms
Demographic – new generations differ due to technology & internet
Environment – we now make an effort to protect the environment
Income – differences in discretionary income affects lifestyles
Education – more education one has the more they are likely to earn
Impact
Businesses – choices business make in the features they build into and promote in their
product or service
Consumers – appeal of different products and services and features valued to different groups
Technological – innovation and how it affects how we are able to do business and consumer
expectations
Payment options – paying electronically; saves money on materials and is faster
Operational innovations – a necessity to embrace or can create competitive advantage
Patents – owning intellectual rights to a process or idea creates competitive advantage
Consumer products – new devices and capabilities made available, upgrading old
Microenvironment
Microenvironment: all of the factors in which a company has direct control or which applies
specifically and uniquely to all its operations (4 C’s)
4 C’s – can affect the company positively or negatively resulting in progress, regression or a
disadvantage
Company
Goals – assess if opportunities align with company’s goals and core competencies
Products – companies must have an arrange of products at different stages to fund others
Image – influences customer purchases, companies must increase trust and loyalty
Experience – in reference to company leadership
Culture – influence on creativity and productivity of employees, affecting competiveness
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Resources
oFinancial – does the company have funds to support programs and products?
oHuman – does the company have the right people?
oOperational – does the company have the capabilities to produce as expected?
Collaboration
Distributers – gets products to customers, if network is not wide enough company risks not
reaching revenue goals
Suppliers – materials contribute to the quality of a product
Alliances – most sought after are ones with excellent reputation and image which enhances
partners
Customer
Market size, growth, trends – growing market; demand is high & low barriers, new product;
company must communicate with early adopters who influence purchase
Quantity
Segments and benefits sought
Decision process – if the product is an infrequent & high cost purchase decision takes long
Motivation – distinguishable benefits that encourage customers to switch from competitors
Frequency
Competitors
Actual or potential
Direct or indirect – indirect; vying for discretionary income
Products – range offered
Positioning – in the minds of the consumer and market share
Market share – one leader established; discouraging, perceived high barriers
Ansoff's Matrix
Market penetration (current market, current product) - to maintain
or increase a company share of the market
Can increase by encouraging new applications or changing
marketing mix
i.e. rogers offering a deal for a bigger data plan; gets customers
accustom making them willing to pay more
Market development (new market, current product) – to sell an existing product to another market
Used when current market is saturated, untapped markets, excess capacity, new
channels i.e. internet, producing one more unit of product will not incur large expenditures
i.e. Sara Lee agreeing to product president choices cheesecake, acting as a manufacturer
Product development (current market, new product) – to create new products to replace existing
ones or revise current ones with new features so they appear new
Used when from has strong R&D and can innovate quickly, market is growing, customer
tastes are changing, a firm has a well known brand w/ solid reputation, competitor prices
preferred
Strategy to retain current customer’s, w/o product development product appears
outdated
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