Marketing Review for Final PDF

What is Marketing? American Marketing Association Definition Marketing is the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large. Marketing...

What is Marketing? American Marketing Association Definition Marketing is the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large. Marketing Management Orientations Production Product Selling Marketing Societal concept Concept concept Concept Marketing Concept Customer Needs, Wants, and Demands Needs Maslow's Hierarchy of Needs Wants Demands Advertising Decisions Setting Advertising Objectives Evaluate Strategic Direction ! Evaluate alternatives (Ansoff’s matrix) Present Product New Product Present Market Product Market Penetration Development New Market Diversification Market Development Can we have more than one strategic direction? Actors in the Microenvironment The Company’s Macroenvironment  The Complete Process Market Market Market Segmentation Targeting Positioning Identify bases for Develop positioning segmenting the Develop measures for each targeted market of segment segment attractiveness Develop profiles of resulting Select the target Develop marketing segments segment(s) mix for each target segment Segmenting, Targeting, & Positioning 8 Requirements for Effective Segmentation Measurable Accessible Substantial Differentiable Actionable Major Segmentation Variables Geo- Demo- graphic graphic Psycho- Behav- graphic ioral Geographic Segmentation Geographic segmentation calls for dividing the market into different geographical units such as nations, regions, states, counties, cities, or even neighborhoods. Demographic Segmentation Age Gender Family Size Family Life Cycle Income Occupation Education Religion Race Generation Nationality Psychographic Segmentation Social Class Lifestyle Personality  Types of Consumer Decision Making Low Purchase High Purchase Involvement Involvement Problem Recognition Problem Recognition Problem Recognition Information Search Information Search (Internal & Some External) (Internal & External) Evaluation Search Evaluation of Alternatives Evaluation of Alternatives (Internal) (Few Criteria) (Many Criteria) Purchase Purchase Purchase Post-Purchase Post-Purchase Post-Purchase (Dissonance y/n) (Dissonance y/n) (Dissonance y/n) Consumer Value and Behavior 14 Types of Business-Buying Decisions Straight Rebuy Modified Rebuy New Buy Need Recognition Need Recognition Need Recognition Development of Development of Product Specifications (Few) Product Specifications (Many) Supplier Search Supplier Search Supplier Search (Very Limited) (Limited) (Extensive) Analysis of Proposals Analysis of Proposals (Few Decision Criteria) (Many Decision Criteria) Order Placement Order Placement Order Placement Use & Evaluation Use & Evaluation Use & Evaluation 15  T33 Demand Curves Price P2 P’2 P1 P’1 Q2 Q1 Q’2 Q’1 Quantity demanded Quantity demanded per period per period A. Inelastic demand B. Elastic demand 16 Major Pricing Strategies Selected Pricing Strategies and Approaches ! Cost plus pricing--standard markup to cost ! Competition-based pricing--“going rate” ! Value-based pricing – Value = Quality/Cost ! EDLP ! Target Pricing ! Segment Pricing ! Bundling ! Penetration ! Skimming Pricing Strategies 18  Pricing Strategies Cost Skimming Pricing Penetration Pricing Cost/Price Quantity 19 Breakeven Pricing  $145 $145 x 1.25 = $181.25 179x = 125x + 20m à x = $20m/$54 = 370,370 Pricing Strategies 21 What is a Product? A product is anything that can be offered to a market for attention, acquisition, use, or consumption that might satisfy a want or need. Consumer Products Consumer products are products bought by final consumer for personal consumption. Classification of Consumer Goods Convenience frequently purchased, low cost, readily available Shopping goods usually compared for quality, price, and style Specialty Goods goods specifically sought out--usually less available, more effort required to find and buy Unsought Goods not often thought about; require more personal selling Services Services are a form of product that consist of activities, benefits, or satisfactions offered for sale that are essentially intangible and do not result in the ownership of anything. Services Marketing Heterogeneity Customer-Centered New-Product Development New-product development that focuses on finding new ways to solve customer problems and create more satisfying customer experiences. Product Life-cycle Strategies Integrated Marketing Communications Customers are Marketing strategies changing are changing The communications model is shifting from broadcasting to narrowcasting Promotional Mix Personal Selling: Personal presentation by the Public Relations : firm’s sales force Building good relations Sales promotion: with the company’s Short-term various publics incentives to Primary tools—publicity, encourage the event sponsorship purchase Promotion mix: Direct marketing: Advertising: Paid, Communication tools Direct, targeted, impersonal, one-way mass communication used to inform, communications persuade, and remind marketer potential buyers to intended to get influence an opinion or immediate response elicit a response 30 THE AIDA CONCEPT AND THE HIERARCHY OF EFFECTS MODEL Purchase Conviction Preference Liking Knowledge Awareness Attention Interest Desire Action Cognitive Affective Behavior “thinking” “liking” “doing” 31 Marketing Communications & PLC Maturity Decline Sales ($) Introduction Growth Time Light Heavy use of Advertising, Ads decrease; AD/PR Advertising; Advertising; PR, brand sales decrease; pre- PR for loyalty; promotion; limited introduction awareness; personal personal sales publicity sales selling for selling; promotion; promotion distribution reminder & personal for trial persuasive selling for distribution  Direct Exchange Manufacturer Manufacturer Manufacturer Manufacturer Customer Customer Customer With Intermediaries Manufacturer Manufacturer Manufacturer Manufacturer Wholesaler or Retailer Customer Customer Customer Time Gaps Space Gaps Consumption Production Variety Gaps Quantity Gaps Information Gaps Channel Functions ! Information--gathering and distribution ! Promotion--persuasive communication ! Contact--locating buyers and sellers ! Matching--fitting buyer and sellers needs ! Negotiation—terms of exchange (price) ! Physical distribution--movement of goods ! Financing--temporary use of funds ! Risk taking--esp. from owning product Channel Decisions 34 Types of Retailers Self-service Specialty Limited-service Department Full-service Supermarket Convenience Superstore Amount of Product Line Service Types of Retailers (continued) Discount Chain Off-price Franchise Factory outlet Warehouse club Relative prices Organizational approach Wholesaling ! Wholesaling includes all activities involved in selling goods and services to those buying for resale or business use. Supply Chain management Retailing Trends and Developments Trend #3: Growth of non-store retailing  Retailing Trends and Developments Trend #5: The Rise of Megaretailers The increase of mass merchandisers, specialty superstores, vertical marketing systems, and retail mergers and acquisitions. Intensity of Distribution Levels of Intensity of Distribution Intensive Distribution (convenience Goods) every outlet where consumers may want to buy Selective Distribution (shopping goods) few dealers in local geographic area Exclusive distribution (specialty goods) Very few, exclusive in geographic region. Factors influencing intensity Type of purchase—high/low involvement Consistency with positioning (rest of marketing mix) Channel Decisions 41 Channel Conflict Vertical Manufacturer Conflict Wholesaler Wholesaler Wholesaler Retailer Retailer Retailer Manufacturer Wholesaler Wholesaler Wholesaler Retailer Retailer Retailer Horizontal Conflict 42 Vertical Marketing Systems Vertically Integrated for Conflict Reduction Vertical Marketing Systems: producers, wholesalers, and retailers act as a unified whole Administered Traditional, top-down structure, controlled by dominant channel member Corporate Owned and controlled by single entity Contractual Systems Formal, voluntary, structured organizations, division of competences for common goals Retail Sponsored Cooperatives Wholesaler Sponsored Chains Franchised systems Common goals--Key to avoiding conflict 44  PUSH VERSUS PULL STRATEGY Push Strategy Pull Strategy Manufacturer Manufacturer Wholesaler Wholesaler Retailer Retailer Consumer Consumer Promotions Demand for Product Offering 45 Trans. 15-13 Sales Promotion Tools Consumer Oriented Trade Oriented (Pull) (Push) Samples Allowances Coupons Cooperative Rebates Advertising Price packs Trade contests Premiums POP materials Awards Training Programs POPs Specialty Advertising Contests Trade shows Promotion 46 The Nature of Personal Selling Personal selling is the personal presentation by the firm’s sales force for the purpose of making sales and building customer relationships Sales Force Strategy and Structure Territorial sales force structure Salesperson assigned to a geographic territory and sells full line Product sales force structure Salesperson specializes in selling only a portion of the company’s products Customer (market) sales force structure Salespeople specialize in selling to certain customers or industries Branding Decisions Brand Sponsorship Manufacture's brand Private Brand (or Store Brand, Distributor Brand) Generic branding Hybrid branding (co-branding and licensing) Brand strategies Whether to deepen the line/mix Whether to broaden the line/mix Whether to stretch the brand upward and downward? Issues Capitalizing on brand equity vs. dilution Brand and product category fit Cannibalism vs. competition Efficient use of resources Major International Marketing Decisions Deciding How to Enter the Market Copyright ©2014 by Pearson Education, Inc. All rights reserved Deciding on the Global Marketing Program Standardized global marketing Uses the same marketing strategy and mix in all the company’s international markets. Adapted global marketing Adjusts marketing strategy and mix elements to each international target market, bearing more costs but hoping for a larger market share and return.