COMM 296.pdf

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Department
Commerce
Course
COMM 296
Professor
Rui Jorge Basto Da Silva
Semester
Fall

Description
September 4 Wednesday, September 04, 2013 8:29 AM • People value items differently; depends on the person • May need to find the people in order to market the product to them ○ Sony tape recorder marketed to university students instead of general public • Exams are objective ○ Multiple choice or short answer ○ Majority coming from the textbook and in-class lecture • Group assignment divided into four parts September 9 Monday, September 09, 2013 8:24 AM Value • Value does not just have to come at the transaction, it can come before or after ○ Apple: customer service, app store, Apple care, etc. • Companies should choose between competing in value or prices • If things with high in value, may have less competition when the price changes ○ If the same product with lower value changes in price, there may be a switch to alternatives • "What can I do, so that you and I can make money together?" ○ Everyone in the value chain is able to make money with higher value products • Companies may have several different things, complementary or not, to create/increase value • Consumers from different countries have different ideas on value ○ May be different from country to country in Europe, USA to Canada, etc. • The value is in the eye of the beholder • North American based companies need to tailor their goods/services to new markets ○ Disney did not change when they put a park in Hong Kong  Consumer behaviour is much different than in NA • Companies must not only understand the value/needs of the customer but much more Goals and Target(s) • Divisions of a company must have similar/same goals ○ CEO must know what the target/objective of the company is • Companies must know who their target(s) is/are in order to have the same goals and max. operations Global Value • Value can come from previous experiences ○ The experience and culture may be valued differently between people • The more you understand, other person's perspective, helps to market products Starbucks • Location, interior design, employee training ○ Everything they do has a purpose to grab your attention ○ Things may not be labelled as a marketing expense but it is related September 11 Wednesday, September 11, 2013 8:28 AM • Marketers have to give consumers a reason to buy a product • Good companies are able to create value for their consumers through marketing • Companies need to first build a relationship with consumers ○ Buy because you trust them, you know them, etc. 4P's 4C's Product Consumer Need Price Consumer Willingness to Pay Place Consumer Convenience Promotion Consumer Communication September 23 Monday, September 23, 2013 8:31 AM Vision: how do you see yourself/firm in the future • Where do you see them going/what are you going to achieve • Something you tell the outside world of who you want to become in the future Mission: what you tell the internal parts of the firm what you want to do SWOT: must have 5 in each category • Must also do a SWOT for other market competitors Segmentation: dividing particular parts of the overall market Positioning: how firms compete within each individual market segment Target: how you target consumers within each market segment October 9 Wednesday, October 09, 2013 8:32 AM Slap Chop: • Practical • Targeting needs • Product differentiation • Feedback • Extra value (free) • Puts extra pressure Brain Behaviour: • Commitment principle ○ Once you have committed yourself your tendency is to finish the sale ○ If you can get the first foot in, deposit, time committed, etc. • Consistent principle ○ People tend to follow trends ○ Doesn’t have to follow the trend of a lot of people • Liking principle ○ People that are similar to each other are attracted to each other • Authority principle ○ People tend to respect people who are better than them • Scarcity principle ○ Exclusivity, limited ○ Offer does last for ever, limited supply ○ Accelerates your buying behaviour • Social validation ○ People tend to follow what the majority is doing ○ The majority has a way of changing your mindset • Reciprocity principle ○ People are designed to return favours All of these tactics could increase the chances that you will buy a particular product. October 16 Wednesday, October 16, 2013 8:54 AM Family Buying Decisions: • The user is not always the decision maker • Sales people will most likely target the person that makes the decisions in the family ○ This is done to increase the chance of sale • There is a user, initiator, influencer, decider, and buyer Consumer Decision Process: • Recognize need • Search for info • Evaluate alternatives • Choose/purchase • Evaluate post-purchase Social Reference Groups: • Affects the way how one sees something • Direct (member): actually apart of a group • Indirect (non-member): groups that have no structure, just profiled Chapter 1 Wednesday, September 04, 2013 11:27 AM • Great marketing succeeds in providing the best value to customers What is Marketing? • Marketing: the activity, set of institutions, and processes for creating, capturing, communicating, delivering, and exchanging offerings that have value for customers, clients, partners and society • Marketing plan: specifies the marketing activities for a specific period of time • Marketers seeks potential customer that have an interest/ability to buy a product ○ Find those who are most likely to be interested in a product/offer • Companies provide use information you provide to facilitate future exchanges Marketing Mix: 4 Value Definition P's Product Creating •Create value by developing offerings to satisfy needs •Goods and services are combined to increase value •Value is added when ideas are adopted Price Capturing •Price is determined by a buyer's belief of value •$ buyer is willing to spend; reasonable profits Place Delivering •Integrate suppliers, manufacturers, etc. into supply chain •Products produced/distributed (quantities, locations, time) •Minimizing costs while satisfying customer needs Promotion Communicatin •Marketers must communicate, promote value to g customers •Influence customer opinion (informing, persuading) • B2B (business to business), B2C (business to consumer), C2C (customer to customer) Manufacturer B2B Retailer B2C Consumer A C2C Customer B (makes ↔ (sells ↔ (buys ↔ (buys used computer) computers) computer) computer) • Employment marketing: marketing programs to attract potential employees ○ Understanding what employees seek, and what they think about the firm • Production era: good products sell themselves, product innovation rather than customer satisfaction • Sales era: lots of personal selling and advertising • Market era: making consumer products, shopping malls, plentiful supply, customers' wants/needs • Value-based marketing era: better value, determining value • Value co-creation: customers collaborate with manufacturers/retailers to create a product/service What is Value-Based Marketing? • Business must understand what customers view as key benefits and how to improve on • Business must understand what customers view as key benefits and how to improve on them • Hard to deliver constant value with new competitors, changing consumer perceptions, etc. • Value marketing includes deciding what products/services to provide for whom Becoming Value Driven: Sharing Information •Share info about customers/competitors; integrate across departments •Purchase information, customer trends, etc. used to predict the future Balancing Benefits with •Measure perceived customer benefits vs. cost of Costs product/service •Use data to better satisfy needs, keep costs down, develop loyalties Building Customer •Transactional orientation: buyer-seller relationship based on Relationships transactions •Relational orientation: building long-term customer relationships •Customer relationship management: loyalty strategy for valued customers Connecting Using •Connect better with customers and serve their needs more Social/Mobile effectively •Location-based apps helps businesses connect with customers Why is Marketing Important? • Marketing advises how much of a product to make and when to ship it • Creates relationships with firms and help expand globally by determining customer values • Marketers analyze new customers' needs and wants segment-by-segment or region-by- region • Supply chain: group of firms that make/deliver a good or service ○ Raw material → manufacturer → retailer → consumer ○ Successful chains share data, make joint forecasts, and coordinate shipments ○ Chains also include marketing research firms, computer firms, e-commerce support, etc. • Companies are able to market their social responsibility through their mission statements/actions • Firms operating with high corporate responsibility/ethics may be perceived as safe investments • Entrepreneurs understand the marketing opportunity of an unfilled need ○ Understand market opportunity and develop/communicate the value of their good/service Chapter 2 Tuesday, September 10, 2013 5:47 PM What is a Marketing Strategy? • Marketing strategy: firm's target market, marketing mix, and obtaining a competitive advantage • Sustainable competitive advantage: something the firm can persistently do better than its competitors ○ Building a strong and long-term competitive advantage is difficult to maintain • Customer excellence: retaining loyal customers and excellent customer service ○ Loyalty programs, good/consistent customer service • Operational excellence: efficient operations and excellent supply chain and human resource management ○ Develop vendor relationships (special rights/exclusivity), knowledgeable/committed employees • Product excellence: products with high perceived value and effective branding and positioning • Locational excellence: a good physical location and internet presence The Marketing Plan • Analysis of current marketing situation, opportunities/threats, four P's, and projected income ○ Helps provide a reference point for future evaluations, and to see if objectives are met • Planning phase: define the mission vision, assessing various players (inside/outside the organization) • Implementation plan: identify/evaluate different opportunities, implement marketing for four P's • Control phase: manager evaluate the marketing strategy and take necessary correcting actions 1. Define the Business Mission a. Mission statement: firm's objectives and scope of activities it plans to undertake 2. Conduct a Situation Analysis a. Situation analysis: SWOT analysis that asses both internal and external environments b. CDSTEP: cultural, demographic, social, technological, economic, and political forces 3. Identifying and Evaluating Opportunities Using STP a. STP: using segmentation, targeting, and positioning to evaluate opportunities and increase sales b. Market segment: group of consumers who respond similarly to a firm's marketing efforts c. Market segmentation: divided consumer groups with different needs, wants, or characteristics d. Target marketing: evaluating the attractiveness of various segments, then choosing a market e. Market positioning: defining market mix variables to give customers understanding of the product 4. Implementing Market Mix and Allocate Resources a. Price based on the value that the customer perceives 5. Evaluate Performance Using Marketing Metrics a. Metric: measuring system that quantifies a trend, dynamic, or characteristic i. Explain why things happen and to project the future i. Explain why things happen and to project the future ii. Vary on the level of the organization, and the resources managers control b. Strategic business unit: unit that can operate somewhat independently from other divisions Growth Strategies • Market penetration strategy: employs existing marketing mix and focuses efforts of existing customers • Market development: employs existing marketing offering to reach new market segments • Product development: offers a new product or service to a firm's current target market • Diversification strategy: firm introduces a new product/service to a new market segment • Related diversification: current target market/marketing mix share something with the new opportunity • Unrelated diversification: a new business lacks any common elements with the present business Chapter 4 Monday, September 23, 2013 10:04 AM A Marketing Environment Analysis Framework • Marketers find changes in what their consumers want and adapt their product/service • Consumers are effected by the immediate environment and the macroenvironment ○ Immediate environment: a company, competition, corporate partners ○ Macroenvironment: culture, political/legal, economic, demographic, social, technology (CDSTEP) The Immediate Environment • Firms focus on satisfying costumer needs that match their core competencies • Marketers must understand its competitors strengths/weaknesses and how they will react to changes • Corporate partners work better with a firm if they have a similar vision and work towards a similar goal Macroenvironmental Factors • Culture: shared meanings, beliefs, morals, values, transmitted by words, literature and institutions ○ Country culture: tools/artifacts, behaviour, dress, symbols, physical settings, language, etc. • Demographics: characteristics of the population and segments (used to identify consumer markets) ○ Generational cohort: group of people in the same generation (similar behaviours/experiences) ○ Seniors buy quality goods, loyal to brands, and are consumer more info on the internet ○ Baby boomers are independent and youthful, while keeping economic security ○ Generation X has grown up with less economic prosperity, more knowledgeable about products ○ Generation Y has balance between work/life, multitasking, supporting lifestyle • Demographics are all affected by income, education, gender and ethnicity • Social trends are shaping consumer values across the globe ○ Consumers are trying to spend less, and get by without decreasing their savings ○ Health and wellness are more important than ever (obesity, sanitization, marketing, etc.) ○ Green marketing raises questions about the true reason firms do it, and the benefits ○ Privacy concerns have increased with more/better technology and easy access ○ Marketers must adjust to people having less time to see/watch advertisements  Also includes multi-access for consumers, store convenience, and longer hours • Technology is allowing consumers to access more products faster and easier ○ Marketers must find ways to advertise on smaller screens and make quicker impressions • The economics situation including inflation, foreign currency exchange rate and interest rates ○ Marketers examine these to determine how consumers buy merchandise/spend money • Political/regulatory environment: political parties, government organizations, and legislation ○ How businesses communicate with consumers (debt collection regulation, etc.) ○ Governments enact laws on specific industries/products (competition, health, etc.) Chapter 7 Monday, October 14, 2013 1:07 PM Growth of the Global Economy: Globalization of Marketing and Production • Globalization of production: manufacturers taking advantage of lower costs globally • General Agreement on Tariffs and Trade (GATT): established lower trade barriers • World Trade Organization (WTO): replaced GATT 1994; deals with rules of trade for nations • International Monetary Fund (IMF): promotes international monetary cooperation ○ Facilitates expansion and growth of international trade • World Bank Group: development bank that provides loans, policy, etc. to low-middle income countries Assessing Global Markets • Economic factors: general economic environment, market size/population growth, and real income • Gross National Product: GDP plus the net income earned from investments abroad • Purchasing power parity (PPP): if exchange rates are the same, a product purchase in one country will cost the same in the other • Human development index (HDI): quality index using life expectancy at birth, educational attainment, and whether average incomes are sufficient • It is important to understand how the population is dispersed ○ Densely populated areas, or rural towns with small populations ○ Affects chain supply management, and pricing (cost to deliver products) • Infrastructure: the basic facilities, services, and installations needs for a society to function ○ Transportation, distribution channels, communication, and commerce • Governments can enforce tariffs, duty, quotas, or other regulations that restrict the selling of goods • Dumping: when a foreign producer sells its offering in a foreign market at a price less than its cost in order to gain market share • Boycott: a group's refusal to deal commercially with some organizations to protest against policies • Hofstede's beliefs in differing cultures 1. Power distance: willingness to accept social inequality as natural 2. Uncertainty avoidance: how much society relies on orderliness, consistency, structure 3. Individualisms: perceived obligation to and dependence on groups 4. Masculinity: extent to which dominant values are male oriented 5. Time orientation: short versus long term orientation Choosing A Global Entry Strategy • Strategic alliances: collaborative relationships between independent firms (not an equity partnership) • Joint venture: a firm entering a new market pools its new resources with those of a local firm to form a new company in which ownership, control, and profits are shared • Direct investment: a firm maintains 100% of its assets while forming a wholly owned subsidiary Choosing A Global Marketing Strategy • Companies have trouble understanding the differences in cultures across the globe ○ Subcultures within each country are also difficult to determine as a foreign firm ○ Subcultures within each country are also difficult to determine as a foreign firm •
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