MGTA01H3 Lecture Notes - Chevrolet Cobalt, Tums, Tiger Woods
Lecture 6: Marketing
Productivity and Quality:
•Productivity: minimizing ratio of inputs (labour, parts, etc.) to outputs (finished products).
•In other words: making a product quickly, efficiently and cheaply.
•Productivity: ratio of inputs (hours of labour or numbers or parts, dollars worth of parts)
gone in to make a finishing product. A firm minimizing the amount of parts and investment
that goes into a product. Canadian economy is less productive than the US economy at
least 20%. Average worker turns out less than 20% of the American worker. His maybe
because; Canadian managers don’t invest on, on the job training, don’t invest in capital
equipment (machinery), American managers are prepared to try new interesting
•Quality: making a product that us fit for use
•In other words: making a product that works as it should
Quality: giving the customer what they are expecting; what they want; the product they
think they are paying for. Making a product that is going to work like it’s supposed to.
Example of Quality: (Honda recall- air bags don’t work); Toyota’s: breaks do not work,
had to do a recall. Shares slide as reputation loses steam (headlines). High quality
reliable vehicles known as, pay a little more than the US vehicles but it is worth it. If you
sell cars that do not work, and when customers get disappointed; sales of Chevy cobalt
have increased to about 149.7 % and Toyota`s have fallen gone into the negative
percentages. Have to go back to factory and repairing product if makes a mistake,
reputation takes a major hit.
Marketing: Target Markets & Market Segmentation
-Well managed businesses:
-Do not sell what they have (product focus)
-Sell what customers want (customer focus)
-Focus on customer is called the `marketing concept`
business: and organized to make or supply or produce something which you then try and sell
to customers with a view towards making a product.
Doesn’t sell what it think you should have, it tries and sells what you want, what you think you
need, what you think should be useful. That is preoccupying yourself with he customer, well
managed business asks what you want, and what you need. Customer focus.
-The Business is directed towards serving existing and potential customers, while making
-No business has ultimate time
-No business has ultimate resources
-No business can sell to everybody
-Marketing Begins with determining: Who is the target market?
-The specific group of people the business targets as the most likely/intended customers
-People with similar needs and wants
People who do not have teeth cannot buy tooth paste. People who cannot read will not buy
text books. People who are vegetarians will not buy meat. There will always buy people who will
not buy your product. An intelligent business man realizes you can’t be all things to all people.
Giving my customer what they wants/need/what they tell us they want begins with question.
Identify ages, gender, what people are interested in ect., concentrate efforts to specific groups
-Marketers divide world into smaller and smaller groups of similar people.
-People whose needs, wants, attitudes to product likely to be similar
-Called `Market Segmentation`
-Some ways markets can be segmented:
-Demography: external traits
-Psychography: Internal traits
-Geography: where people live
-Demography- a person`s external traits:
-age, gender, race income; for example Kraft dinner
Study of population, external characteristics, how old people are, break down of income, etc.
Divide up world by concentrating on; let’s try and sell a product to 18- 25 year olds, lets try and
talk to people under 15 so we can see what they need, let’s see what females want oppose to
men, or look at things in case of religion, rich the poor, the hopes the dreams of people in
middle income. There are products that are pitched at you and there are products are pitched at
me, different incomes, people buy bubble. Prof Drinks scotch whiskey. East Asians are more
likely to have bubble tea. (Canadaian born Chinese CBC). Pacific mall; pirated DVDs. Kraft
Dinner: sort of people who buy this are not super wealthy, fairly limited income, sell to people
who are in a hurry and are busy, quick and filling, eat for convince instead of making a gourmet
•Psychography - a person`s internal traits
-Beliefs, values, motivations. Example: Political parties, charities.
Inside brain, hearts, guts. Identify people who have common belief systems, common values
and common motivations. Products that pitch to people who see them see as tree hugging
nature folks. People who have strong religious beliefs. Political parties; try and reach people and
influence them, and go after people who wish to do the same thing. Watching TV and political
advertisement comes on, they tell you things you want to hear and they target families in the
same situation. Vote for specific Party because they well you, you are hard working,
responsible, discipline, and think that paying a a whole bunch of extra taxes are wasteful and so
they vote for that specific party. Different parties say different things, Stefan Harper, Jack latan.
Pitching message to different types of people.
Geographic Segmentation- where people live
-Region, rural vs. Urban, climate. For example: Quebec vs. Rest of Canada.
Getting votes from a specific country targeting to that specific country.
When you go to the movies are different; depending on what type of movie it is, they have
specific ads directed to a specific management. – demographic segmentation (different age)
Will not sell air conditioners in cold places, will not sell heaters in warm places, will not
•Segmentation – All 3
Decided to sell running shoes, go after a certain type of customer needed a sales spoke
person they chose Michael Jordan. Sell to people 15-30 years old, he`s a man, Nike wanted to
sell running shoes to men. Sell to Americans. Michael played in Chicago, played in big mid
western industrial city, so assumed people in big American industrial cities would buy. People of
all colours would buy these shoes, but more specifically black people. Target: Age, region,
They then started selling products to females. Nike decided to slightly change their message
so moved on to talk to and try and understand and try and reach another segment. Changed
image because they were not speaking to women. Sponsored the women’s soccer team. Spoke
person; Meha Ham, stuck her name on bill boards. So many female soccer player went out and
bought her equipment. Brandy Chastain kicked the winning goal with 10 minutes left, she took
off her shirt and millions of people saw her bra, and her bra had the symbol of Nike, this
encouraged millions of women to buy Nikes Bra, Nikes products.
Then later on Tiger Woods became spoke person because they wanted to get across to other
types of people. He is a good golfer, he is black and Asian. Fastest growing economy and golf
market, th biggest and fastest growing economies, in Asia. Went for a guy who is part asian so
he transcending and hey were now going international. For people who are rich and old.
-Having identified the `target, ` managers must create products: With features people want
– Product; at prices they will pay – Price; that they know about – Promotion; that they can
easily – Place.