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Wilfrid Laurier University
Dave Ashberry

Chapter 1: Overview Marketing Mix (4 Ps) 1. Product 2. Price 3. Promotion 4. Place External Forces: The Marketing Environment 1. Social/Cultural Trends 2. Economic - currency fluctuations, inflation, interest rates 3. Technology 4. Political/Regulatory - Patent act, NAFTA, competition act 5. Competitors - use CI (competitive intelligence) 6. Demographics Eras of Marketing 1. Production-Oriented Era - 20 century, “a good product will sell itself” 2. Sales-Oriented Era - 1920-1950, lots of personal selling/advertising 3. Market-Oriented Era - manufacturers focused on what consumers wanted/needed 4. Value-based Marketing Era - have to give consumers greater value than their competitors Chapter 2: Developing Marketing Strategies Strategic Marketing Planning Process (Developing a Marketing Plan) 1. Define Mission/Vision - find sustainable competitive advantage 2. Situation Analysis - SWOT analysis 3. Identify and Evaluate Opportunities using STP - also develop marketing mix 4. Implement Marketing Mix - allocate resources 5. Evaluate Performance and Make Adjustments STP – segmentation, targeting, positioning Growth Strategies 1. Market Penetration 2. Market Development 3. Product Development 4. Diversification Macro Strategies Pricing Strategies (marketing mix ‘price’ step) 1. Customer Excellence 1. Cost-Based Pricing 2. Product Excellence 2. Competitor-Based Pricing 3. Operational Excellence 3. Value-Based Pricing Levels of Strategic Planning 1. Corporate Planning - 5 years, define mission, set company goals 2. Strategic Business Unit (SBU) / Division Planning- 3-5 years, set goals/ establish portfolio of products 3. Functional Planning - 1-3 years, develop plans for specific products/brands Chapter 3: Ethics and Socially Responsible Marketing Framework for Ethical Decision Making 1. Identify Issues 2. Gather Information + Identify Stakeholders 3. Brainstorm + Evaluate Alternatives 4. Choose a Course of Action Integrating Ethics Into Marketing Strategy 1. Planning Phase - mission/vision set overall ethical tone for planning (values statement) 2. Implementation Phase - should firm be targeting this market with this product - should firm be selling the product in this manner 3. Control Phase - check successful implementation, react to changes Six Tests of Ethical Action 1. Publicity Test 2. Moral Mentor Test 3. Admired Observer Test 4. Transparency Test 5. Person in the Mirror Test 6. Golden Rule Test Chapter 4: Analyzing the Marketing Environment Generational Cohorts Demographics Social + Cultural Concerns Baby Boomers Income Culture/Ethnicity Country Culture Seniors Education Green Consumers Time Poor Society Gen X/Gen Y Gender Privacy Concerns Regional Subculture Tweens Age Scenario Planning – process that integrates macroenvironmental info in an attempt to understand the potential outcomes of a firm’s marketing mix 1. Assess Strengths and Weaknesses 2. Assess Threats and Opportunities 3. Identify Different Scenarios - test each scenario against the firm’s competencies 4. Apply the Marketing Mix to Different Scenarios Chapter 5: Marketing Research + Info Systems Marketing Research Process 1. Define the Problem and Objectives 2. Design the Research Process - Primary/Secondary Data 3. Data Collection - Exploratory/Conclusive 4. Analyze Data 5. Present Results Primary Secondary - observed consumer behaviour - census data - books - focus group interviews - Internet - journal articles - surveys - sales invoices Exploratory Research Methods Conclusive Research Methods a) Observation a) Survey - questionnaire (structured/unstructured) b) Ethnography b) Experimental Research c) In-Depth Interview c) Scanner Research - UPC codes (AC Nielson) d) Focus Group Interview d) Panel Research e) Projective Technique - can be Descriptive (red/blue) or Experimental (test prices) Chapter 6: Consumer Behaviour Consumer Decision Process 1. Need Recognition a) Functional Need b) Psychological Need 2. Information Search a) Internal Search for Information - personal experience b) External Search for Information – family/friends/Internet 3. Alternative Evaluation 4. Purchase 5. Post Purchase - stand behind product - encourage feedback - build realistic expectations - demonstrate correct use Factors Affecting Consumers’ Search Processes (Step 2) a) Perceived Benefits vs. Perceived Costs of Search b) Locus of Control - Internal Locus of Control - believe they have control over their outcomes - External Locus of Control - fate or external factors controls all outcomes c) Actual or Perceived Risk - Performance Risk - poorly performing product/service - Financial Risk - monetary (warranties help alleviate this) - Psychological Risk - might not convey right message d) Type of Product or Service - Specialty Goods/Services - will spend time searching for best suppliers - Shopping Goods/Services - will spend time comparing alternatives - Convenience Goods/Services - won’t spend any effort evaluating before purchasing Consumer Decision Rules (Step 3) – criteria consumers use to select from several alternatives a) Compensatory Decision Rule - evaluate trade offs b) Noncompensatory Decision Rule - choose a product/service off a subset of its characteristics c) Decision Heuristics - mental shortcuts; brand names = safe, expensive = good qual. Types of Consumer Buying Decisions High Involvement Low Involvement Significant Perceived Differences Complex Buying Behaviour Variety Seeking Behaviour Few Perceived Differences Dissonance Reducing Behaviour Habitual Buying Behaviour Psychological Factors a) Motives - PSSP b) Attitude Factors Influencing Consumer Buying Decisions 1. Psychological Factors - cognitive component - affective component 2. Social Factors (family, reference groups) 3. Culture - behavioral component 4. Situational Factors c) Perception d) Learning PSSP Hierarchy of Needs – physiological needs, safety needs, social needs, personal needs Situational Factors (step 4) a) Purchase Situation - thrifty shopper buys expensive dress for wedding b) Shopping Situation - store atmosphere, salesperson, packaging, promotions, etc. c) Temporal State - different times of day may affect appeal Chapter 7: Business-to-Business Markets Characteristics of Business Markets - demand for business products is “derived” from consumer demands - fewer customers, larger orders, more geographically concentrated - more inelastic demand, fluctuates more - more complex buying decisions - competitive bidding, negotiated prices, qualified professional buyers B2B Buying Process 1. Need Recognition 2. Product Specification 3. RFP Process - request for proposal; invites firms to bid on supplying products 4. Proposal Analysis + Supplier Selection 5. Order Specification - places order 6. Vendor/Performance Assessment Factors Affecting the Buying Process 1. Buying Centre - 6 people: influencer, initiator, decider, buyer, user, gatekeeper (controls info) 2. Buying Situation a) New Buy (all steps) b) Straight Rebuy (only steps 5/6) c) Modified Rebuy 3. Organizational Culture (see below) Types of Buying Centres 1. Autocratic Buying Centre - one person makes the decision alone 2. Democratic Buying Centre - majority rules in the decision 3. Consensus Buying Centre - all members must reach a collective agreement 4. Consultative Buying Centre - one person makes the decision but consults others first Chapter 8: Segmentation, Targeting, Positioning Step 1: Strategy and Objectives - visions/objectives/strategy must be consistent with mission and situation Step 2: Profile Segments Segmentation Methods (can use multiple segmentation methods) a) Geographic b) Demographic c) Psychographic d) Behavioural - benefits derived, user status, usage rate, loyalty Must Understand 3 Concepts: VALS Psychographic System a) Self-values (goals for life) - survivors - innovators b) Self-concept (image someone has of themselves) - achievers - experiencers c) Lifestyles (how people live their lives to achieve goals) - thinkers - makers - believers - strivers Step 3: Evaluate Segment Attractiveness a) Identifiable b) Reachable c) Responsive - react positively to firm’s offering d) Substantial + Profitable - size and growth potential Step 4: Select Target Market a) Mass/undifferentiated - product perceived to provide the same benefits to everyone b) Differentiated - targets several market segments, different offering for each c) Concentrated - single, primary target market – focus all energy on providing a product to fill that market’s need d) Micromarketing One-to-One - mass customization Step 5: Identify and Develop Positioning Strategy Firms Position Products/Services According to: a) Value b) Product Attributes - focus on what attributes are most important to the target market c) Benefits + Symbolism - emphasize benefits of brand d) Competition - firms can position against a product/brand head-to-head e) Market Leadership - companies may emphasize their leadership Positioning Stages - when developing a positioning strategy, firms go through 5 important stages 1. Determine consumers’ perceptions and evaluations of the product/service in relation to competitors 2. Identify competitors’ positions 3. Determine consumer preferences 4. Select the position 5. Monitor the positioning strategy - can reposition and rebrand as well A positioning statement expresses how a company wants to be perceived by consumers Positioning Statement Formula For (target customer) Who (statement of the need or opportunity) The (product name) is a (product category) That (statement of key benefit; compelling reason to buy) Unlike (primary competitive alternative) Our product (statement of primary differentiation) Chapter 9: Product, Branding, and Packaging Branding Strategies 1. Brand Ownership 2. Naming Brands 3. Brand Extension 4. Cobranding 5. Brand Licensing - ex. Harley Davidson beef jerky Value of Branding - facilitate purchasing - establish loyalty - protect from competition - reduce marketing costs - brands are assets - impact market value Branding Brand Equity Brand Ownership Strategies Brand Name Strategies a) Brand Awareness a) Manufacturer (National a) Corporate (Family Brand) ex. The Gap Brand) b) Perceived Value b) Store (Private Labels) b) Corporate and Product Line Brand ex. Kellogg’s c) Brand Associations c) Generic - commodities c) Individual ex. Tide, Febreeze d) Brand Loyalty What Makes a Brand? - Brand Name - Jingles - Slogans - Characters - Logos/Symbols - URLs Brand Dilution - refrain from extending brand name to too many products - evaluate consumer perceptions of the core brand The packaging can be used to create value for products Brand Extension Advantages a) Well Established Name b) Brand Known for High Quality c) Lower Marketing Costs d) Synergy Among Products e) Boost Sales of Core Brand Increase Breadth: capture new/evolving markets, increase sales by adding new product lines Decrease Breadth: delete entire product lines to address changing market conditions Increase Depth: new products within a line to address changing consumer preferences Decrease Depth: delete product categories to realign resources (remove unprofitable items) Change # SKUs: - stimulate sales / react to consumer demand - fashion manufacturers change SKUs every season Brand Equity - assets/liabilities linked to a brand that add to or subtract from the value Chapter 10: Developing New Products Consumer Adoption Cycle (diffusion of in
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