Marketing Management Summary PDF

Marketing Management Marketing Management Opening Lecture The Hype Around Generative AI in Marketing Current Narrative - AI positioned as universal solution for marketing challenges - Promise of unlimited efficiency and automation - Capabilities span data analysis, content, and pe...

Marketing Management Marketing Management Opening Lecture The Hype Around Generative AI in Marketing Current Narrative - AI positioned as universal solution for marketing challenges - Promise of unlimited efficiency and automation - Capabilities span data analysis, content, and personalization Key Questions - What lies beyond the hype? - How are marketers using generative AI? - What challenges emerge for: - Individual marketers - Organizations Recent Marketing Study New Reality in Marketing Marketing Management Usage of AI  Marketing Management Generative AI is perceived as a promising Solution ➔ “Lack of knowledge of generative AI is a barrier to its adoption.” How to navigate AI knowledge Gaps  Marketing Management Tutorial 1 What is a product? Anything we can offer to a market for attention, acquisition, use, or consumption that might satisfy a need or want. This includes: Physical goods, Services, People, Places, Ideas ➔ Product: Tangible , Consistent, Ownership and separation of Production and Consumption The Five Product Levels: 5. Potential Product 4. Augumented Product 3. Expected Product 2. Generic Product 1. Core Benefit What is a service? ➔ Service: Intangible, Variability, no ownership and simultaneous production and consumption What is a brand? A brand is more than a product, because it can have dimensions that differentiate it in some way from other products designed to satisfy the same need. These differences may be rational and tangible (related to product performance of the brand) or more symbolic, emotional, and intangible (related to what the brand represents). Brand Equity – Refers to the value that a brand adds to a product or service. ➔ Firm benefits: higher prices and/or sales, bargaining power with suppliers, customer loyalty Brand Value – The monetary worth of your brand, if you were to sell it (Measured with Financial Forecast, Role of Brand and Brand Strength).  Marketing Management Tutorial 2 Kapferer (2008), The new strategic brand management (pp. 171 - 199) A brand is not just a name, it represents a vision and a set of core values that create loyalty among consumers. Identity vs. Positioning - Brand identity is the brand’s core essence, defining its uniqueness, while positioning focuses on differentiating it in the market at a specific time. What is identity? - Meaning - Identity in branding is similar to a personal identity card, representing distinctive, permanent traits that the brand projects. It aligns the brand’s actions and communications toward a coherent message. - Elements - Brand identity consists of key attributes, values, and a consistent nature that customers recognize. It answers what makes a brand unique, its purpose, and its core beliefs. ➔ Brand identity specifies the facets of a brands uniqueness and value. (Kapferer, p.173) ➔ Brands with a clear identity have a longer lifespan because they remain consistent in their messaging and offerings. ( Kapferer p. 175) Brands need comprehensive guidelines to maintain their essence and navigate today's complex communication landscape. Brand identity is defined after these questions are answered: - What is the brand’s particular vision and aim? - What makes it different? - What need is the brand fulfilling? - What is its permanent nature? - What are its value or values? - What is its field of competence? Of legitimacy? - What are the signs which make the brand recognisable?  Marketing Management Identity and Image An image is a synthesis made by the public of all the various brand messages. The Brand Identity Prism Kapferer’s Brand Identity Prism is a framework for analyzing brand identity through six facets: 1. Physique: Physical characteristics or features associated with the brand, such as design and unique product elements. 2. Personality: The character or personality traits a brand would have if it were a person. 3. Culture: The values and beliefs that drive the brand, which influence its appeal and its actions. 4. Relationship: The type of interaction or bond the brand has with its customers. 5. Reflection: How customers perceive themselves through the brand. 6. Self-Image: How customers feel about themselves when using the brand. -> Defines the identity of a brand as well as the boundaries within which it is free to change or to develop.  Marketing Management ➔ Brands need comprehensive guidelines to maintain their essence and navigate today's complex communication landscape. Brand Positioning - Purpose - Positioning differentiates a brand by defining a unique selling point that appeals to its target market. It establishes a brand’s relevance and advantage over competitors. Two-stage process: - First, indicate to what ‘competitive set’ the brand should be associated and compared. - Second, indicate what the brand’s essential difference and raison d’être is in comparison to the other products and brands of that set. Effective positioning involves defining: - The benefit it offers - The target audience it serves - The reason behind its promises - Its competitive edge in the market A brand’s positioning is a key concept in its management. It is based on one fundamental principle: all choices are comparative. Practical Applications - Brand Essence: This term captures the brand’s core promise or value in a concise way, representing what the brand fundamentally stands for (e.g., Volvo’s essence is “safety”). - Brand Symbols and Characters: Many brands use visual symbols, emblems, or characters to reinforce identity and facilitate recognition. - Adaptability in Identity and Positioning: Brands need a stable identity to maintain coherence but should adapt their positioning over time to respond to changing market conditions. - The product is the first source of brand identity. ➔ Products increase customer choice; brands simplify it. (Kapferer, p.178)  Marketing Management Identity and Graphic Charters - Visual Identity Guides: Many companies use brand charters or graphic identity guides to ensure that the brand’s visual elements consistently represent its identity. - To help identity and recognise the brand. - To guarantee the brand. - To give the brand durability. - To help differentiate and personalise: an emblem transfers its personality to the brand. Aaker (1997), Dimensions of Brand Personality Brand Personality A set of human characteristics associated with a brand. Brand personality is the set of human characteristics associated with a brand. This includes traits like being “cool” or “reliable,” which allow consumers to connect with brands in a human-like way. - Purpose - Brand personality helps differentiate a brand in the market. It goes beyond product attributes, offering symbolic value, allowing consumers to express their identity, values, or desired traits through brand association. Aaker developed a universal measure of brand personality. Dimensions of Brand Personality Aaker identifies five major brand personality dimensions. These dimensions capture different aspects of brand character, allowing companies to craft brand identities that resonate with specific consumer traits.  Marketing Management 1. Sincerity: Reflects warmth, honesty, and a family-oriented image. Brands with this personality are seen as genuine, wholesome, and down-to-earth, often appealing to emotions of trust and reliability. (Dove) 2. Excitement: Associated with daring, spirited, and imaginative qualities. Brands with this personality often aim to be seen as youthful, trendy, and dynamic. (Red Bull) 3. Competence: Represents reliability, intelligence, and successfulness. Brands here are often perceived as secure and efficient, appealing to consumers’ need for trust and assurance. (WSJ) 4. Sophistication: Conveys luxury, charm, and elegance. Brands with this personality are often associated with high status, aiming to appeal to aspirations for an upper-class lifestyle. (Mercedes Benz) 5. Ruggedness: Involves toughness and outdoorsy traits. Brands with a rugged personality appeal to a sense of masculinity and strength. (Land Rover) ! Brands should not attempt to max out all five dimensions: - Trying to maximise every aspect would dilute the brands identity - Should focus on the dimensions that best reflect their core values and positioning Building Brand Personality - Direct associations: People linked to the brand, such as users, employees, and endorsers, contribute traits to the brand. - Indirect associations: Product-related attributes, logo, advertising, and distribution also shape the brand personality. For instance, Coca-Cola’s associations with being “cool” and “all-American” stem from both its advertising and symbolic elements. ➔ Brands must create detailed guidelines covering both tangible elements and intangible values to maintain their identity.  Marketing Management Measurement and Validation of Brand Personality - Scale Development: To reliably measure these traits, Aaker created a standardized scale. Initial traits were gathered from psychological scales, marketing practices, and consumer responses. This set was then refined to a manageable number for practical use. - Reliability Tests: The brand personality scale was tested for stability using demographic variety (age, gender) and high reliability scores, ensuring consistency across consumer groups. How to use the scale: - Participants respond to each trait (e.g., “this brand is down-to-earth”) using a 1 = strongly disagree to 7 = strongly agree scale. - For each personality dimension, the ratings are averaged into a single score. For example, the sincerity dimension is the average of traits 1-11. Applications and Practical Implications - Consumer Preferences: Brand personality influences consumer preference by enabling consumers to express elements of their self-identity or aspirations. For instance, someone valuing ruggedness might prefer a brand like Harley-Davidson, symbolizing strength and masculinity. - Cultural Differences: Brand personality may vary across cultures due to differing values. In individualistic cultures, brands might symbolize uniqueness, while in collectivist cultures, brands may represent conformity to group standards. Tutorial 3 Kim & Lim (2018): “A Comprehensive Review on Logo Literature: Research Topics, Findings, and Future Directions” This article provides a thorough review of the logo literature over the past 30 years, categorizing research findings into six major topics and offering a framework for understanding logos from both theoretical and practical perspectives. - Purpose and Framework: This paper provides a systematic review of logo literature, focusing on theoretical foundations and classifying studies into six main areas: theoretical foundations, logo design/redesign, basic and additional logo elements, outcomes of logo use, and practical applications.  Marketing Management Theoretical Foundations: - Corporate Visual Identity (CVI): Logos are integral to a company’s visual identity, shaping perceptions and differentiating brands. - Processing Fluency: Familiar logos enable easy recognition, leading to positive brand evaluations. Logo Design and Elements: - Basic Elements: Includes typeface, shape, and color; each element plays a role in brand recognition. - Additional Elements: Emerging topics likepresentation elements, animated and sonic logos and digital considerations. Brand Element - Brand Name, Brand Logo, Slogans, Jingles, Packaging, Characters - Outcomes: Logos impact consumer responses, brand equity, and financial performance. A good logo design strengthens brand associations and positively influences purchase intentions. - Future Directions: The study calls for more research on dynamic logo elements and their application across varied cultures and digital platforms.  Marketing Management Luffarelli, Mukesh, & Mahmood (2019b): “Let the Logo Do the Talking: The Influence of Logo Descriptiveness on Brand Equity” This study examines the role of logo descriptiveness (visual cues indicating product type) on brand equity, particularly focusing on how descriptive logos affect consumer perceptions, brand evaluations, and purchase intentions. - Objective: This study explores how descriptive logos - those that visually indicate the type of product or service - affect brand equity. Key Definitions - Descriptive Logos: Logos that include visual or textual elements suggesting the type of product/service (e.g., a coffee cup for a coffee brand). ➔ The extent to which the textual and/or visual design elements of a logo are indicative of the type of product a brand markets (Luffarelli et al., 2019) - Brand Equity: The value derived from a brand’s recognition and perception in the market. Findings Descriptive logos enhance ease of processing, making brands seem more authentic and credible, leading to better brand evaluations and higher purchase intentions. Moderators - Brand Familiarity: Descriptive logos are more effective for unfamiliar brands. - Product Valence: Descriptive logos benefit brands with positive associations but can harm those with negative ones (e.g., funeral homes). - Implications: Companies, especially new ones, should consider descriptive logos to quickly build trust and recognition. Benefits of descriptive logos - Easier to process - Greater authenticity - Greater liking of the brand - Greater willingness to buy and higher net sales  Marketing Management Luffarelli, Mukesh, & Mahmood (2019a): “A Study of 597 Logos Shows Which Kind is Most Effective” This article investigates whether descriptive or nondescriptive logos are more effective for brands, particularly in building consumer recognition and loyalty. Objective This article examines whether descriptive logos (logos that visually explain a product/service) are more effective than nondescriptive logos. Definitions Descriptive vs. Nondescriptive Logos: Descriptive logos have clear visual cues about the product, while nondescriptive logos do not directly indicate what the brand sells. Findings - Descriptive logos help consumers understand the brand’s purpose, leading to increased authenticity perceptions, favorable evaluations, and higher purchase intentions. - Descriptive logos generally boost sales, although they are less effective for well-known brands and for products with negative associations. Practical Advice: Startups and new brands should consider descriptive logos to quickly establish brand identity. Bajaj & Bond (2017): “Beyond Beauty: Design Symmetry and Brand Personality” This research delves into the influence of design symmetry in logos on brand personality perceptions, specifically how symmetry or asymmetry can affect whether a brand is seen as calm or exciting. - Objective: This study investigates how design symmetry in logos affects consumer perceptions of brand personality, specifically focusing on the traits of excitement and calmness. Theoretical Background: - Brand Personality: Defined as the set of human characteristics associated with a brand, including traits like excitement, sincerity, and sophistication. - Symmetry and Arousal: Asymmetry in logo design evokes excitement through heightened arousal, while symmetry creates perceptions of calm and stability.  Marketing Management Findings: - Asymmetric designs are associated with excitement, making them suitable for brands wanting an adventurous image. - Symmetrical designs communicate dependability and calm, which benefits brands focused on trustworthiness. ➔ Exposure to visually asymmetric (vs. symmetric) brand elements will increase perceptions of a brand as exciting (vs. unexciting) Implications: Brands should align their logo symmetry with their desired brand personality, using asymmetry for dynamic brands and symmetry for reliable ones. What is the connection between brand elements and brand personality/identity? Brand elements (like logos, colors, and shapes) directly shape a brand’s personality by evoking traits such as trust, excitement, or sophistication. For example, circular logos suggest comfort, while angular ones convey strength, helping consumers quickly identify and connect with a brand’s unique identity. Based on Bajaj and Bond (2017), which logos should be used to create which brand personality? Based on knowledge of brand logos, do you agree or disagree with these research findings? Think about specific examples! Bajaj and Bond (2017) suggest asymmetric logos create a sense of excitement, fitting brands like Red Bull, while symmetric logos imply reliability, suiting brands like Visa. I agree with this, as asymmetric designs often evoke energy, while symmetry feels stable. However, brands like Nike combine symmetry and movement, showing personality can be layered. What makes a meaningful brand name? Again, can you think of real-world examples that agree/disagree with the research findings? A meaningful brand name should be memorable, relevant, and evoke positive associations. Examples include Airbnb, which is straightforward, and Whole Foods, reflecting its wholesome mission. While descriptive names are instantly clear, even abstract names (e.g., Kodak) can gain meaning through branding. What are logo elements? Why is understanding logo design and its effects important for international business? (Kim and Lim, 2018) Logo elements (typeface, shape, color) each add to brand identity. For international business, understanding these is crucial as cultural interpretations vary; for example, color meanings differ globally. A culturally aware logo, like McDonald’s golden arches, can strengthen brand consistency while resonating locally.  Marketing Management Tutorial 4 Web-lecture Measurement Measurement is the process of assigning numbers, labels, or well-defined descriptions to characteristics, attributes, or phenomena (called constructs) to quantify, categorize, or describe them systematically. Operationalization Operationalization is the process by which we take a meaningful but somewhat vague concept and turn it into a precise measurement. - A precise definition of what is measured. - Determining the method of measurement. - Choosing a level and range of measurement. A variable is the quantifiable data collected from individuals, objects, or phenomena when a measurement method is applied to assess a theoretical construct. - Not all variables are equal. - Different types of variables are called levels (or scales) of measurement. Transforming the levels Data can be transformed from one level to another. - Transformations are unidirectional: Ratio → Interval → Ordinal → Nominal - Transforming data results in a loss of information.  Marketing Management Likert Scale A Likert scale is a type of survey question that lets you express how strongly you agree or disagree with something using a numbered range, like 1 for 'strongly disagree' to 5 for 'strongly agree’. Variables Discrete variables - A discrete variable is one that can only take on distinct, separate values, typically counts of items or occurrences. For example, the number of students in class. Continuous variables - A continuous variable is one that can take on any value within a given range, representing measurements that can be infinitely divided. For example, the time students prepare for class. We often aim to understand some variables in terms of some other variables. - Outcome variables (dependent variables): to be explained - Predictor variables (independent variables): to do the explaining Tests Needed for BRP Reliability - Refers to the degree to which a measurement or assessment tool produces stable and consistent results over time. Validity - Refers to the extent to which a tool or method accurately measures the construct it is intended to assess. Internal Validity - Refers to the extent to which you are able draw the correct conclusions about the causal relationships between variable. External/ecological validity - Refers to the extent to which your results generalize to settings beyond your study. Construct validity - Refers to whether you’re measuring what you want to be measured.  Marketing Management Ron Kohavi and Stefan Thomke (2017): “The Surprising Power of Online Experiments” The article “The Surprising Power of Online Experiments” by Ron Kohavi and Stefan Thomke highlights how controlled online experiments (A/B tests) enable data-driven decisions and iterative improvements, driving significant business benefits. What is an Experiment? Experimental research involves the researcher's control over variables, with the manipulation of independent variables to observe their effects on dependent variables, using randomization to minimize biases. Non-experimental research lacks the manipulation of variables seen in experimental designs, often due to ethical or practical constraints, making it more susceptible to confounding variables Quasi-experiments resemble controlled experiments but do not manipulate independent variables, instead observing naturally occurring variations with more caution in result interpretation. A/B Testing ➔ A fancy way of saying independent t-test Key Benefits - Data-driven decisions: Replaces guesswork with hard data. - Minor changes with potentially major impact: Small tweaks can significantly boost revenue. - Fast iteration: Quick idea validation enables agile adaptation. - Investment insight: Guides resource allocation with precise impact analysis. - Evidence-based strategy: Elevates decision-making to a scientific process. Potential Risks - Data Integrity: Accurate A/B testing requires data validation, like A/A tests, to eliminate distortions from anomalies such as bot traffic. - User Response Variance: Significant differences in how user segments respond to A/B tests can skew results, necessitating detailed analysis. - Causality Confusion: A/B tests must carefully distinguish causality from mere correlation to avoid false conclusions about the effectiveness of changes. Advantages of Online Experiments - Rapid, low-cost tests on large user bases. - Incremental improvements often yield significant gains. - Data-driven decisions reduce guesswork.  Marketing Management Designing Effective Experiments - Define Overall Evaluation Criteria (OEC) aligned with strategic goals. - Avoid errors like sample ratio mismatches and carryover effects. Causality vs. Correlation - Controlled experiments clarify causal effects. - Observational studies risk misleading, correlation-based conclusions. In essence, online experimentation empowers companies to refine their offerings and boost performance through evidence-based, iterative improvements. Tutorial 5 Two Types of Statistics - Descriptive Statistics: Describing the features of a dataset in statistical terms. - Inferential Statistics: Drawing inferences from a sample about a larger population. Sampling - Sample: Actual data that is available to researchers. A subset of the population the researcher wants to draw conclusions about. - Population: All possible observations the researcher wants to draw conclusions about. Key Elements of samples - Represent a subset of a larger population - Must be selected through a defined process - Need to be large enough for statistical validity - Should represent the population's key characteristics Key Theory - In a simple random sample, every member of the population has an equal chance of being selected. - Stratified sampling: Divide population into subgroups (strata) before random sampling. - Snowball sampling: Current study participants recruit future participants. - In convenience sampling, participants are selected based on their availability and ease of access to the researcher - Issues of convenience sampling: - Self-selection - Non-representative sub-populations: You are WEIRD - Western, Educated, Industrialized, Rich, and Democratic - Students  Marketing Management “Hard” incentives - Money, gift card lotteries, gifts, course credit “Soft” incentives - Being nice, transparency and honesty, good study design, interesting topics Central Limit Theorem (CLT) The central limit theorem states that the distribution of sample means approximates a normal distribution as the sample size becomes large. Why do we care? - Larger sample sizes are more reliable than smaller ones. - The normal distribution is the basis of many statistical tests -> We are building confidence intervals (CIs) to make claims about differences. What is a large sample size? - Conventionally, a sample size of 30 or larger suffices for the CLT to hold. Law of Large Numbers This law states that as your sample size increases, your sample statistics get closer to true population values. Effects: - More stable estimates - Reduced impact of outliers - Better representation of population diversity - More reliable decision-making basis ➔ The larger your sample, the closer the sample mean will be to the population mean. Confident Interval - A 95% Confidence Interval is a range derived from sample data that has a 95% chance of containing the true population value under repeated sampling. Questionnaire 1) What do you want to find out? - What is your research question and hypothesis? - What are your predictor and outcome variables? 2) What data do you need to answer your research question? - Operationalize your theoretical constructs. - Choose method of measurement.  Marketing Management 3) How do you analyze the data? - Different data structures require different skills. Be sure that you have the skills to analyze the data. 4) How can the data be collected? - Choose the right questionnaire elements to collect the required data. Questionnaire Flow Main Body - This part contains your actual (research) questions. - For academic research, work “backwards”: start with measuring the outcome variable before measuring the process variable. - For non-academic research, get the most ”valuable” data first.  Marketing Management Question Types Closed-ended - Multi-choice - Multi-select - Ranking order - Rating order - Scale - Matrix Tables - Sliders Demographics - Are statistical data relating to the population and particular groups within it, such as age, gender, income level, education, and ethnicity. Tutorial 6 Court (2019): “The consumer decision journey“ This article introduces the Consumer Decision Journey, emphasizing the shift from a linear funnel model to a circular and dynamic process. It identifies critical stages - initial consideration, active evaluation, purchase, and postpurchase - and highlights the growing role of consumer-driven touchpoints. Additionally, it differentiates between active and passive loyalty, illustrating the importance of influencing postpurchase behaviors for sustained brand success. Introduction to the Consumer Decision Journey (CDJ) - Traditional funnel models suggest a linear process where consumers narrow down options and make a purchase. This metaphor no longer captures the complexity of modern decision-making. - CDJ represents a circular, dynamic process shaped by a variety of touchpoints and consumer behaviors.  Marketing Management Key Phases in the Consumer Decision Journey Initial Consideration - Consumers create a shortlist of brands based on impressions from advertisements, conversations, and experiences. - Brand awareness is critical here, as brands in the initial-consideration set are three times more likely to be purchased. Active Evaluation - Consumers expand or reduce their brand choices by researching and evaluating options. - Unlike the funnel, where options are narrowed, this stage often sees new brands entering consideration through consumer-driven marketing, such as online reviews and word-of- mouth. Moment of Purchase - Consumers make their final decision based on accumulated information and personal preferences. Postpurchase Phase - The consumer’s experience with the product influences future loyalty and brand advocacy. Positive experiences may reinforce loyalty, while negative ones open doors for competitors. Active Loyalty - Fully committed to the brand - Choosing the brand repeatedly - Recommending the brand Passive Loyalty - Not fully committed - Choses brand out of convenience - Open to changing if another better option arises  Marketing Management Empowered Consumers and Marketing Shifts - The transition from marketer-driven to consumer-driven marketing is profound: - Two-thirds of active-evaluation touchpoints are consumer-driven, including online reviews, word-of-mouth, and past experiences. - One-third are marketer-driven, like advertisements and direct marketing. - Successful companies adapt by influencing consumer-driven channels, ensuring a consistent and compelling presence across all stages Types of Loyalty in the Postpurchase Phase Active Loyalty - Consumers who not only continue purchasing but also recommend the brand to others. Passive Loyalty - Consumers remain with the brand out of convenience or habit but are open to switching if persuaded by competitors. Application in Different Industries - The automobile insurance sector illustrates these concepts: - Some companies, like GEICO and Progressive, actively target passively loyal customers from competitors by simplifying the comparison and switching process. - Strong customer satisfaction in the postpurchase phase creates a “virtuous cycle,” reinforcing loyalty and encouraging positive word-of-mouth. Hilken et al. (2018): “Making Omnichannel an Augmented Reality“ This paper explores AR’s potential to enhance omnichannel experiences, offering a framework grounded in situated cognition. It highlights AR’s ability to create seamless, engaging customer journeys by blending online and offline elements, while addressing gaps in current applications and research.  Marketing Management Theory - Situated Cognition Framework: AR-enabled customer experiences are conceptualized around three principles: - Embedded Experiences: Integrate products/services into the consumer’s immediate context (e.g., virtual try-ons). - Embodied Experiences: Simulate physical interaction, improving product evaluation through sensory engagement. - Extended Experiences: Enable social sharing and collaborative decision-making. Integration of Online and Offline Channels - AR merges online convenience with offline sensory engagement. - Applications like L’Oreal’s virtual mirror or IKEA’s furniture placement app illustrate practical benefits. Barriers and Solutions - Customer dissatisfaction often stems from a lack of seamless channel integration. - AR can overcome these by reducing decision-making uncertainty and providing real-time, context-sensitive experiences. Batra and Keller (2016): “Integrating Marketing Communications“ This article presents frameworks for optimizing integrated marketing communications. It emphasizes the need for consistency, complementarity, and understanding cross-media interactions in a fragmented media landscape. Purpose of IMC - Ensure consistent messaging across all channels. - Maximize marketing impact through integrated efforts. - Build trust and loyalty with a unified brand experience. - Optimize resources by reducing redundancies. Relevance of IMC - Addresses multichannel consumer behavior. - Integrates traditional and digital marketing strategies. - Differentiates brands in competitive markets. - Aligns with customer-centric approaches. - Improves cost efficiency in marketing campaigns. Challenges in IMC - Shifting consumer behaviors and media usage patterns complicate communication integration. - The rise of digital media necessitates synchronized messaging across channels.  Marketing Management Two IMC Models - Top-Down Optimization Model - Evaluates the overall integration/effectiveness of communication strategies to balance short-term sales and long-term brand equity. - Bottom-Up Matching Model - Matches media to consumers’ needs at different decision stages. Bottom-Up Stages: Awareness Stage - Capturing attention and introducing the brand. Consideration Stage - Help consumers evaluate options and builds trust. Decision Stage - This targeted communication can influence consumers to make a purchase. Key Considerations: - Consistency: Unified messaging across platforms. - Complementarity: Utilizing diverse media strengths for holistic impact. - Cross-Effects: Interactions between media amplify overall effectiveness. Tutorial 7 Akina and Berger (2007): „Valuable Virality“ - Defined as content that is both widely shared (viral) and beneficial to the brand (valuable). - Viral content must enhance brand evaluation and purchase likelihood, not just reach large audiences. Types of Advertising Appeals - Emotional Appeals: Use drama, mood, and music to elicit emotions and are more likely to be shared. - Informative Appeals: Focus on product features and benefits, increasing brand evaluation and purchase intent. - Emotional Integral Appeals: Combine emotional engagement with brand relevance to achieve both high sharing and strong brand outcomes.  Marketing Management Key Insights - Emotional appeals generate higher sharing due to their engaging and surprising nature. - Informative appeals build trust and provide valuable information, improving brand-related outcomes. - Emotional integral ads strike a balance, enhancing both virality and brand evaluation by embedding the brand meaningfully in the ad narrative. Mechanisms Driving Effectiveness - Inferences About Persuasion: Emotional integral ads are perceived as less manipulative, fostering positive brand impressions. - Brand Knowledge: Ads that make the brand integral increase consumer understanding and recall of the brand’s attributes. What is valuable virality? Valuable virality refers to the creation of advertising content that not only spreads widely through social sharing but also provides tangible benefits to the brand, such as improved brand evaluation, increased purchase intent, or stronger brand knowledge. What are the different types of advertising appeals? - Emotional Appeals: Engage emotions like happiness, surprise, or awe. - Informative Appeals: Offer detailed, logical information about product features and benefits. - Emotional Integral Appeals: Combine emotional engagement with a clear and relevant connection to the brand.  Marketing Management How do these different advertising types shape valuable virality? - Emotional Appeals: Drive higher shares due to their engaging and entertaining nature but may lack direct brand impact if the brand is not central to the narrative. - Informative Appeals: Strengthen brand trust and knowledge but may limit sharing as they lack emotional resonance. - Emotional Integral Appeals: Achieve a dual effect by enhancing both virality (through emotional engagement) and brand outcomes (by making the brand a meaningful part of the story). Kaplan and Haenlein (2011) : “Two hearts in three-quarter time: How to waltz the social media/viral marketing dance“ What is Viral Marketing? - Viral marketing is a form of electronic word-of-mouth (eWoM) where a marketing message spreads exponentially, often through social media. - It relies on social media platforms to reach a wide audience quickly, leveraging user- generated content and sharing mechanisms. - The term was first introduced by Jeffrey Rayport in 1996, likening the spread of marketing messages to viral epidemics. Relationship Between Viral Marketing, Word-of-Mouth, and Social Media Word-of-Mouth (WoM) - Sharing of information between individuals, traditionally face-to-face or via small networks. - Effective in influencing consumer behavior and decision-making (e.g., reducing perceived risk or time spent on choices). - Electronic WoM (eWoM) accelerates diffusion through digital channels and is easier to monitor.  Marketing Management Social Media - Platforms like Facebook, YouTube, and Twitter are ideal for viral marketing due to their broad reach and interconnectivity. - Viral marketing campaigns often merge with social media strategies, as these platforms amplify the spread of content. The Three Basic Criteria for Viral Marketing Success The Right Messengers - Market Mavens: Early adopters with extensive knowledge who introduce messages to their network. - Social Hubs: Individuals with a large number of connections who disseminate the message widely. - Salespeople: Persuasive communicators who amplify the message, making it more relatable and convincing. The Right Message: - The message should be memorable, interesting, and emotionally engaging. - Stories, humor, surprise, and positive rumors can make messages more shareable. Emotional triggers like joy, fear, or disgust enhance virality. The Right Environment: - Success depends on seeding the message strategically across different subcultures and ensuring it reaches disconnected groups. - Timing, luck, and a conducive environment (e.g., a trending platform) also play a significant role.  Marketing Management Types of Viral Marketing Campaigns Nightmares - Negative outcomes caused by customer backlash or mismanagement (e.g., JetBlue’s operational issues in 2007). Strokes of Luck - Unexpected, positive outcomes initiated by customers (e.g., Diet Coke and Mentos experiment). Homemade Issues - Failures caused by dishonest or poorly executed campaigns (e.g., Sony’s fake PSP blog). Triumphs - Well-planned and successful campaigns that enhance brand perception (e.g., Burger King’s Whopper Sacrifice). ➔ Triumphs are generally the most beneficial. Rules for Creating a Viral Marketing Campaign 1. Complement the Marketing Mix - Viral efforts must align with product quality, pricing, and distribution strategies. 2. Use Traditional Advertising - Combine viral campaigns with other marketing efforts (e.g., TV ads, sponsorships) to sustain momentum. 3. Avoid Overplanning - Let the campaign develop organically without micromanaging or overly controlling its dynamics. 4. Be Cautious with Provocation - Ensure messages are engaging without crossing into inappropriate or offensive territory. 5. Acknowledge Luck and Uncertainty - Success is partly influenced by timing, trends, and uncontrollable factors.  Marketing Management Practical Applications of Viral Marketing - Companies like Pepsi, Burger King, and Evian have successfully leveraged viral marketing to create significant brand awareness at relatively low costs. - Missteps, such as those by Heinz Ketchup or Microsoft, highlight the risks of poorly executed campaigns. - Viral marketing’s reliance on audience participation makes it unpredictable, but its cost- effectiveness and reach make it a valuable tool in the digital age. Challenges and Future of Viral Marketing - Viral marketing may lose effectiveness over time as audiences become resistant, similar to how telemarketing has declined. - Ethical considerations, such as avoiding deceptive practices, remain critical for maintaining trust with consumers. - While still in its growth stage, viral marketing offers companies a unique opportunity to engage audiences innovatively and cost-effectively. Tutorial 8 Leung et al. (2022a): “Does Influencer Marketing Really Pay Off?“ Key Insights on Influencer Marketing (IM) - Influencer marketing is highly effective when executed correctly, with a 1% increase in IM spend leading to a 0.46% rise in engagement. - Brands often miss optimization opportunities; proper resource allocation could improve engagement by up to 16.6%. Key Influencer Characteristics Impacting Effectiveness - Number of followers: Larger audiences enhance credibility and engagement. - Posting Frequency: Moderate activity (around five posts per week) balances presence and follower interest. - Follower-Brand Fit: A moderate overlap in interests (around 9%) between the influencer’s audience and the brand’s domain ensures engagement without saturation. - Influencer Originality: Authentic and unique content fosters higher trust and engagement, achieving up to 15.5% higher ROI. Content Strategy Considerations - Tone and Positivity: Moderate positivity is more effective than extreme enthusiasm, which may appear insincere. - Inclusion of Links: Posts with links to brand websites or social media achieve higher engagement. - Focus Areas: Posts promoting existing products tend to perform better than those announcing new product launches.  Marketing Management Strategic Recommendations: - Select influencers with the right follower base, activity level, and originality. - Strike a balance in tone and content positivity. - Combine IM efforts with long-term strategies to build sustainable brand trust and loyalty. Leung et al. (2022b): “Online Influencer Marketing (OIM)“ Definition and Scope of OIM - OIM leverages online influencers’ follower networks, positioning, content, and trust to promote brand offerings and enhance marketing communication effectiveness. - Differentiates from traditional marketing approaches by emphasizing engagement, authenticity, and influencer-created content. Key Features of OIM - Resource Utilization: Firms benefit from influencers’ reach, trust, and distinct personal branding. - Content Freedom: Unlike celebrity endorsements, influencers retain significant control over content creation, enhancing authenticity but posing risks. Theoretical Framework Social Capital Theory: OIM is rooted in leveraging influencers’ social capital, which includes: - Structural Capital: Network reach and information diffusion. - Relational Capital: Trust built through personal relationships with followers. - Cognitive Capital: Shared meanings and identity between influencers and their followers. Benefits of OIM - Targeting Benefits: Access to homogenous and dynamically changing audience segments. - Positioning Benefits: Influencers’ personal branding enhances brand positioning and differentiation. - Trust and Engagement: Authentic interactions foster consumer trust and long-term loyalty.  Marketing Management Risks of OIM - Content Control: Limited oversight can lead to misaligned messaging. - Retention Challenges: Dynamic audience changes may affect campaign consistency. Strategic Guidelines - Choose influencers based on fit and alignment with brand goals. - Monitor and guide influencer content without stifling originality. - Measure performance and integrate influencer content into broader marketing campaigns. Tutorial 9 Better/Worse-Than-Average Effect - People generally think they are above average in their abilities for tasks perceived as easy or familiar. - People might rate themselves as worse than average, anchoring on their perception of their absolute performance level and insufficiently adjusting for the task's difficulty for everyone for harder tasks. Diminishing sensitivity - Value derived from gains decreases as the amount of gain increases. That is, the first €100 are more valuable than the additional €100. Loss aversion - People tend to prefer the risky option, reflecting a tendency to take risks to avoid a sure loss. ➔ “The most important determinant of a great data scientist isn’t knowing lots of complicated techniques. It’s having common sense and curiosity, a knack for asking good questions, and the ability to tell a good story with data.” (Steven Levitt)  Marketing Management Why does reliability matter? - Multi-item scales increase precision of the theoretical construct that is measured. - Reliability in multi-item scales ensures that the scale consistently measures the concept it's intended to measure, providing confidence in the results obtained. For two items -> use Pearson correlation For three items -> use Cronbach’s alpha Measures of Central Tendency - Mean: Calculated by adding up all the values in a dataset and then dividing by the number of values - Median: The middle value in a dataset when the values are arranged in ascending or descending order. If there is an even number of values, the median is the average of the two middle numbers - Mode: Value that is observed most often in the data. Standard Deviation - Quantifies the amount of variation or dispersion in a set of values.  Marketing Management Measure of Dispersion Six Sigma is a quality management methodology that aims to improve business and manufacturing processes by minimizing defects and variability. Its goal is to achieve a level where the process mean and the nearest specification limit are six standard deviations apart, resulting in extremely high quality and efficiency with only about 3.4 defects per million opportunities. Box plots - Visualize critical information about the data. QQ-Plot - Matches the data points from your dataset with those of a well-known distribution (like the normal distribution. Deviations from straight line in a QQ-plot indicate departures from theoretical distribution.  Marketing Management Tutorial 10 Null Hypothesis Significance Testing (NHST) A statistical method used to determine if there is enough evidence in a sample of data to reject a null hypothesis. Test Statistics Measure the degree of agreement between the sample data and the null hypothesis. Different tests use different test statistics. P-Values - Probabilities that express how extreme the observed data are, assuming the null hypothesis is true. The p-value shares the same interpretation for different statistical tests. The cut-off (alpha level) between a non-significant and significant results is commonly set at 0.05. - The alpha level is inversely related to the confidence level. ➔ The p-value is the probability of obtaining an observed, or more extreme, test statistic under the assumption that the null hypothesis is true. Directional Hypothesis  Marketing Management One sample t-test When to use it: You want to compare a sample mean to a test value. Paired sample t-test When to use it: You compare means across pairwise observations.  Marketing Management Independent sample t-test When to use it: You have two separate and independent groups and you want to compare their means. - A/B testing Violating assumptions - Independence -> Be aware that results might be biased. - Normality -> Non-parametric test - Unequal variances -> Welch correction ANOVA When to use it: You have more than two separate and independent groups and you want to compare their means. - A/B/C… testing  Marketing Management Chi^2 Test for Independence When use it: You have more than two separate and independent groups and want to compare their proportions based on a categorical or ordinal variable.