Unit 1- The World of Marketing.pptx

Unit 1: The World of Marketing Why Marketing Matters to You Why does marketing matter to me? ▸ Marketing is all around you ▸ You have been involved in marketing since you were born Why does marketing matter in society? ▸ Influences your decisions ▸ Makes our lives better ▹ New and improved pro...

Unit 1: The World of Marketing Why Marketing Matters to You Why does marketing matter to me? ▸ Marketing is all around you ▸ You have been involved in marketing since you were born Why does marketing matter in society? ▸ Influences your decisions ▸ Makes our lives better ▹ New and improved products at lower prices Why does marketing matter in society? ▸ Influences your decisions ▸ Makes our lives better ▹ New and improved products at lower prices ▸ Gives us options ▹ Styles, colors, prices Why does marketing matter in society? ▸ Influences your decisions ▸ Makes our lives better ▹ New and improved products at lower prices ▸ Gives us options ▹ Styles, colors, prices ▸ Benefits our economy and international trade The Value of Marketing Marketing is an organizational function that consists of three components: • Creating value ■ Perceived benefits known as customer value. • Communicating value ■ For example, a new restaurant near a college campus might use online advertisements to communicate its convenient location, healthy alternatives, and monthly student specials. • Delivering value ■ Getting the product in customers hands Marketing Creates Value Apple can charge higher prices than its competitors without fear of losing sales because of the value customers place on Apple products. Needs Versus Wants Value is created when consumer wants and needs are satisfied. • Exchange makes each party better off. • Needs are a basic part of human makeup. • Marketers strive to turn wants into needs. • For instance, turning your need for food into a want for a specific type of food or restaurant. Needs Versus Wants Distinguishing Needs from Wants • Not always black and white. • Marketers provide products that fulfill customers’ wants, which then satisfies their underlying needs. The Ethical Implications of Needs versus Wants • Evaluating customer needs and wants must be done through an ethical framework to avoid potential problems for the firm and society as a whole. Is a child’s car seat a need or want? Satisfying Needs and Wants Car seats are required for any child under 80 pounds. It’s marketing’s job to satisfy that need in a way that also meets the customer’s wants, perhaps for a luxury car seat with more Need Want $49.98 $339.99 Please get your phone into the caddy before the bell rings! Open your Needs vs Need $0.74 Toothbrus h Want $199.99 Need $49.99 Phone Want $1099 Need $219.00 Computer Want $2,699.00 Need $24.99 Shoes Want $160 Need TV Want $500 Need $100 Medicine Want $9.56 Need Video games Want $59.99 Need $201.24 Bed Want $6,299.00 Need $79.99 Books Want $30.00 Need $1,200 Car Want $33,700 EXAMPLEAmazon ▸ What need / want does Amazon fulfill? ▸ Have they turned a want into a need? Marketing Activities ▸ Planning how to carry out the marketing process ▹ Plans guide marketers’ activities ▹ Planning and coordination of marketing activities is essential ▸ Activities focus around the marketing mix ▹ made up the four Ps: product, price, place, and promotion The Marketing Mix: Product • Product contains many tangible and intangible characteristics. • Can also take the form of services or ideas. • Focuses on: • Offering a product that customers want • Fulfilling a need or want The Marketing Mix: Price • Price relates to the value consumers place on the product. • What price would satisfy buyers and sellers? • Easiest marketing-mix element to change. • Affects revenue, which is the amount earned from selling products to customers. The Marketing Mix: Place • Place is important because firms must distribute products to where customers can buy and consume them without difficulty. • Where are customers likely to purchase products? • Creating customer convenience • Relate to locations, transportation, logistics, and supply chain management. The Marketing Mix: Promotion • Promotion includes advertising, sales promotion, personal selling, and public relations. • Capturing customers’ attention • Generating demand for products • Sometimes using tricks! • Advent of social media allow firms to communicate quickly and directly with customers. Marketing M ix Review The Marketing Mix and Decisions That Affect It EXAMPLEAmazon Product Amazon music – exclusive music options Fast shipping (Prime) Prime video eReaders (Kindle) Alexa Variety of products Sell your stuff Place Online App Integration into Kohls Delivery to anywhere (porch pirates) Amazon lockers Taking pictures upon delivery Price Very low prices compared to competition Prime Day Prime daily deals $139 per year | $14.99 Promotion Multiple platforms that advertise other services Sponsorships Wish lists Prime Day Prime daily deals Personalized deals Marketing Mix ▸ Choose a company you like or are loyal to You have until 11:45 to finish the Marketing Mix assignment The Marketing Concept & Market Planning Marketing Concept ▸ Customer orientation ▹ do it the customer’s way ▸ Company commitment ▹ do it better than the competition ▸ Company goals ▹ do it with success in mind Mission Statement Mission Statement ▹ A concise affirmation of the firm’s long-term purpose ▹ Provides a shared sense of purpose, direction and opportunity It should.. ▹ Be focused on a limited number of goals ▹ Be customer-oriented and focused on satisfying basic customer needs and wants ▹ Capture a shared purpose and provide motivation for the employees of the firm Patagonia “Build the best product, cause no unnecessary harm, use business to inspire and implement solutions to the environmental crisis.” In pursuit of its mission statement to build the best products and implement environmentally friendly solutions, Patagonia partners with a Long Beach company, Upcycle It Now, to deconstruct old raincoats and fleece jackets and use them to Patagonia “Build the best product, cause no unnecessary harm, use business to inspire and implement solutions to the environmental crisis.” In pursuit of its mission statement to build the best products and implement environmentally friendly solutions, Patagonia partners with a Long Beach company, Upcycle It Now, to deconstruct old raincoats and fleece jackets and use them to Patagonia “Build the best product, cause no unnecessary harm, use business to inspire and implement solutions to the environmental crisis.” In pursuit of its mission statement to build the best products and implement environmentally friendly solutions, Patagonia partners with a Long Beach company, Upcycle It Now, to deconstruct old raincoats and fleece jackets and use them to Patagonia “Build the best product, cause no unnecessary harm, use business to inspire and implement solutions to the environmental crisis.” In pursuit of its mission statement to build the best products and implement environmentally friendly solutions, Patagonia partners with a Long Beach company, Upcycle It Now, to deconstruct old raincoats and fleece jackets and use them to Mission Statements Company Mission Product 1. American Express 2. TED a. To create a better everyday life for people b. To spread the power of optimism c. To reinvent how people share knowledge, tell stories, and inspire their audiences to act d. To inspire humanity- both in air and on the ground e. To accelerate the world’s transition to sustainable energy f. To make the world’s most respected service brand g. To give customers the most compelling shopping experience possible h. Create economic opportunity for every member of the global workforce a. T-shirts and apparel b. Homegoods 3. Life is Good 4. IKEA 5. Prezi 6. Tesla 7. Nordstrom 8. JetBlue 9. LinkedIn j. Spread ideas c. Digital presentations d. Department store e. Credit cards, rewards, banking f. Solar and renewable energy products g. Airline h. Online professional networking j. In person and recorded keynotes Mission Statements- KEY Company 1. American Express 2. TED 3. Life is Good 4. IKEA 5. Prezi 6. Tesla 7. Nordstrom 8. JetBlue 9. LinkedIn Mission f. To make the world’s most respected service brand j. Spread ideas INCLU DES G OALS CUST ? OMER FOCU SED? MOTIV ATING ? Product e. Credit cards, rewards, banking j. In person and recorded keynotes a. T-shirts and apparel b. Homegoods b. To spread the power of optimism a. To create a better everyday life for people c. To reinvent how people share knowledge, tell stories, and inspire their audiences to c. Digital presentations act e. To accelerate the world’s transition to f. Solar and renewable energy sustainable energy products g. To give customers the most compelling d. Department store shopping experience possible d. To inspire humanity- both in air and on g. Airline the ground h. Create economic opportunity for every h. Online professional member of the global workforce networking EXAMPLEAmazon ▸ "Our mission is to continually raise the bar of the customer experience by using the internet and technology to help consumers find, discover and buy anything, and empower businesses and content creators to maximize their success. We aim to be Earth's most customer centric company.“ ▸ Is their mission statement.. EXAMPLEAmazon ▸ "Our mission is to continually raise the bar of the customer experience by using the internet and technology to help consumers find, discover and buy anything, and empower businesses and content creators to maximize their success. We aim to be Earth's most customer centric company.“ ▸ Is their mission statement.. EXAMPLEAmazon ▸ "Our mission is to continually raise the bar of the customer experience by using the internet and technology to help consumers find, discover and buy anything, and empower businesses and content creators to maximize their success. We aim to be Earth's most customer centric company.“ ▸ Is their mission statement.. EXAMPLEAmazon ▸ "Our mission is to continually raise the bar of the customer experience by using the internet and technology to help consumers find, discover and buy anything, and empower businesses and content creators to maximize their success. We aim to be Earth's most customer centric company.“ ▸ Is their mission statement.. HHS Mission Statement “Hamilton School District – in partnership with a diverse community – ensures maximum achievement for each student through a respectful and engaging learning environment, a rigorous, relevant curriculum and a highly qualified, caring staff” Focused on goals? Customer-oriented? Focused on a shared purpose? Agenda.. ▸ HHS Mission Statement assignment ▸ About Me Slides Tools for Situation Analysis Tools for Situation Analysis SWOT Analysis • Internal considerations • Strengths • Weaknesses • External environment • Opportunities • Threats Strengths ▸ Resource or capability ▸ Something that can result in a competitive advantage ▸ Internal organizational factors ▸ How to determine: ▹ Don’t be modest ▹ Consider the competition ▹ What are HHS’s strengths? Weaknesses ▸ Limitation or shortcoming ▸ Something keeping you from achieving objectives ▸ Internal organizational factors ▸ How to determine: ▹ Can be the flip side of a strength ▹ Be realistic and honest ▹ A mistake is not a weakness Opportunity ▸ Favorable situations in your environment ▸ External environmental factors ▸ What opportunities can HHS take advantage of? Threats ▸ Unfavorable situations in your environment ▸ External environmental factors ▸ What threats does HHS have? SWOT Revie w McDonald’s Uses SWOT Analysis Companies like McDonald’s often complete a SWOT analysis to identify and evaluate their strengths, weaknesses, opportunities, and threats. Get in groups ▸ Once in your group, grab a sheet of paper and some markers Example SWOT Analysis for McDonald’s Internal Considerations Strengths Weaknesses Strong brand recognition Difficulty finding and retaining quality employees Long-term profitability and franchise system Traditional menu filled with high-calorie items Breakfast reputation Longer wait times Example SWOT Analysis for McDonald’s External Considerations Opportunities Threats International expansion Weak economy that cuts dining-out budgets Menu or service expansions Increasing production costs Public interest in ethical and sustainable business practices Health consciousness of U.S. population In your own groups.. ▸ Create a SWOT analysis of Amazon ▹ ▹ ▹ ▹ Strengths Weaknesses Opportunities Threats ▸ Each category must have a MINIMUM of 5 things EXAMPLEAmazon Strengths Lots of products Different services/platforms Accessible from anywhere Delivery – fast Prime Day Opportunities COVID – more online shopping More small businesses moving online Electric vehicle evolution More online shoppers due to convenience Cyber Monday Weaknesses Only shows truck in last 10 stops Out of stock products Only online Annoying return process Packaging waste Threats Underground tax evasion Competing online stores Porch pirates Cyber security Inflation The External Environment Competitive Environment ▸ The marketing environment includes domestic and international factors. ▸ Direct competition / brand competition • SiriusXM and Pandora • Substitute products ▸ Indirect competition • SiriusXM and Apple iPhone Direct Competition Marketing professionals at SiriusXM and every organization must recognize the challenges both direct and indirect competition present and develop strategies to protect and expand their Netflix Indirect Competition Firms that closely monitor indirect competition can take steps to reduce its impact by expanding their offerings, as Coca-Cola did in response to competition from firms promoting healthy alternatives to soft EXAMPLE Indirect Competitors (-2 for each clue given) ▸ Aquafina ▸ Pepsi ▸ Gatorade Direct Competitors (-4 for each clue given) ▸ Yeti ▸ CamelBak ▸ Contigo Competition Review ▸ Get into groups ▸ Have ONE member from your group go to BuzzIn.Live ▹ Game code = 138458 Company 1- 25 points Indirect Competitors (-2 for each clue given) ▸ Subway ▸ Pizza Hut ▸ Taco Bell ▸ Starbucks Direct Competitors (-4 for each clue given) ▸ Burger King ▸ Culvers ▸ Wendy’s Company 2- 25 points Indirect Competitors (-2 for each clue given) ▸ Home Depot ▸ Costco ▸ Kwik Trip Direct Competitors (-4 for each clue given) ▸ Walmart ▸ Meijer ▸ Amazon Company 3- 25 points Indirect Competitors (-2 for each clue given) ▸ Target ▸ Kwik Trip ▸ Meijer Direct Competitors (-4 for each clue given) ▸ Piggly Wiggly ▸ Sendiks ▸ Festival Company 4- 25 points Indirect Competitors (-2 for each clue given) ▸ Crocs ▸ Sperry ▸ Uggs Direct Competitors (-4 for each clue given) ▸ Puma ▸ Reebok ▸ Nike ▸ Under Armour Company 5- 25 points Indirect Competitors (-2 for each clue given) ▸ Schwinn ▸ Razor ▸ Harley Davidson ▸ Vespa Direct Competitors (-4 for each clue given) ▸ Ford ▸ Dodge ▸ Toyota Company 6- 25 points Indirect Competitors (-2 for each clue given) ▸ Best Buy ▸ Walmart ▸ Costco Direct Competitors (-4 for each clue given) ▸ AT&T ▸ Sprint ▸ US Cellular Company 7- 25 points Indirect Competitors (-2 for each clue given) ▸ Lazer tag ▸ Mini golf ▸ Escape room Direct Competitors (-4 for each clue given) ▸ Six Flags ▸ Cedar Point ▸ Universal Studios Company 8- 25 points Indirect Competitors (-2 for each clue given) ▸ Target ▸ TJ Maxx ▸ Kohls Direct Competitors (-4 for each clue given) ▸ Five Below ▸ Dollar General ▸ Family Dollar Company 9- 25 points Indirect Competitors (-2 for each clue given) ▸ US Bank ▸ ATM ▸ VISA Direct Competitors (-4 for each clue given) ▸ Cash App ▸ Paypal ▸ Apple Pay Company 10- 25 points Indirect Competitors (-2 for each clue given) ▸ Cheez Its ▸ Chex Mix ▸ Animal Crackers Direct Competitors (-4 for each clue given) ▸ Famous Amos ▸ Chips Ahoy Market Share Market Share Analysis • Measures the firm’s sales as a percentage of total market sales. • Consider market share data relative to revenue and profitability. 2008 Search Engine Market Share 2005 2018 EXAMPLEAmazon ▸ Direct competitors: ▸ Indirect competitors: ▸ What percent of the ecommerce market does Amazon have? Rest of class.. ▸ Sign up for Virtual Business ▸ Then.. ▸ Tutorial (optional) ▸ Lessons 1 ▸ Lesson 2 ▸ Let me know if you need resets ▸ No working on anything else unless you have all 100% External Marketing Environment External Marketing Environment Environmental scanning • External factors affecting the marketing environment are: ■ Economic ■ Demographic ■ Sociocultural ■ Political ■ Legal ■ Technological External Marketing Environment Economic Factors • • Gross domestic product • A measure of the market value of all officially recognized final goods and services produced within a country in a given period • Recessions lead layoffs, unemployment, and reduced consumer confidence. Income distribution • Dollar Tree markets to low income families Change in Average U.S. Household Income Differing Strategies based on Income Distribution Though they pursued markedly different strategies, both Louis Vuitton and Dollar General had success marketing to a U.S. population characterized by shifting income distribution. External Marketing Environment Economic Factors • • Gross domestic product • A measure of the market value of all officially recognized final goods and services produced within a country in a given period • Recessions lead layoffs, unemployment, and reduced consumer confidence. Income distribution • • Dollar Tree markets to low income families Inflation • Purchasing power Inflation External Marketing Environment Economic Factors • • Gross domestic product • A measure of the market value of all officially recognized final goods and services produced within a country in a given period • Recessions lead layoffs, unemployment, and reduced consumer confidence. Income distribution • • Inflation • • Dollar Tree markets to low income families Purchasing power Consumer confidence affects consumer spending • how optimistic consumers are about the overall state of the economy and their own personal Relationship between Consumer Confidence and Real Consumer Spending Consumer Confidence Hyundai’s Buyer Assurance Program Hyundai’s Buyer Assurance program, which focused on addressing low consumer confidence due to a weak economy, allowed the car company to increase domestic sales, profits, and market share during an economic recession. EXAMPLEAmazon ▸ What economic factors impact Amazon’s business? ▸ Inflation (threat) ▸ in groceries and gas caused decrease customer confidence ▸ Low unemployment (opportunity) ▸ people are making money and can spend money ▸ Income distribution (threat) ▸ less raises – might not be able to afford prime ▸ Income distribution (opportunity) External Marketing Environment Demographic Factors • • • • Age • Baby Boomers • Disposable income • Millennials Gender • Females control the majority of consumer spending. Education • Affects unemployment. Ethnicity • Minorities growing. EXAMPLEAmazon ▸ What demographic factors impact Amazon’s business? ▹ Age (threat) ■ Older generations have disposable income may be uncomfortable with tech ▹ Age (opportunity) ■ Younger generation have less money and more price conscious ▹ Age (opportunity) ■ Younger need to buy more + more with comfortable with technology ▹ Gender (opportunity) ■ Women online shop and browse more + control money ▹ Education (threat) ■ More education = more debt = less money ▹ Education (opportunity) ■ More people working – less time to shop in person External Marketing Environment Sociocultural Factors • Shift from single-income to twoincome families. • Cultural differences. Political Factors • Changing political climate. • Governmental policy affects how marketers position products. • • Tax increase on video games. Increasing influence of political action committees (PACs). Customer Convenience Oscar Mayer’s Lunchables, which typically include crackers, cheese, and meat slices, appeal to busier families looking for a convenient way to prepare their children’s lunch. EXAMPLEAmazon ▸ What sociocultural factors impact Amazon’s business? ▸ Dual income homes (opportunity) ▸ less time to shop in store ▸ Divorce rate is up (opportunity) ▸ buy for 2 households ▸ Diversity (opportunity) ▸ wider range/need for products ▸ COVID (opportunity) ▸ more people not wanting contact ▸ COVID (threat) ▸ Less money due to lay offs ▸ What political factors impact Amazon’s business? ▹ Relationship w/ other countries (threat) ■possible taxes on products ▹ Taxes (opportunity / threat) External Marketing Environment Legal Factors • To ensure businesses compete fairly • To ensure businesses don’t take advantage of consumers. Technology factors • Influences how consumers satisfy needs and wants. • • Apple’s iTunes and iPods Changes how firms promote products. • Instant and direct Understanding Customer Habits New technology, such as Disney’s MagicBands, not only delivers convenience to consumers but also provides marketers with valuable information about a customer’s EXAMPLEAmazon ▸ What legal factors impact Amazon’s business? ▸ Opportunities ▸ Consumer trends + tracking ▸ Threats ▸ Hacking ▸ Privacy ▸ Security ▸ What technological factors impact Amazon’s business? ▸ Opportunities ▸ Better tracking ▸ Better delivery ▸ Threats ▸ Transportation / air space laws Environmental Scan International Marketing Environment • Consumer ethnocentrism • belief by residents of a country that it is inappropriate or immoral to purchase foreignmade goods and services Consumer Ethnocentrism To capitalize on the ethnocentric tendencies of U.S. consumers, both companies have worked through difficult periods to successfully rebrand themselves as key producers of American jobs and as positive contributors to the American economy. Which of these items is impacted by ethnocentrism? Impacted Not Impacted Which of these items is impacted by ethnocentrism? Impacted Not Impacted Which of these items is impacted by ethnocentrism? Impacted Not Impacted Which of these items is impacted by ethnocentrism? Impacted Not Impacted Which of these items is impacted by ethnocentrism? Impacted Not Impacted Which of these items is impacted by ethnocentrism? Impacted Not Impacted Which of these items is impacted by ethnocentrism? Impacted Not Impacted Which of these items is impacted by ethnocentrism? Impacted Not Impacted EXAMPLEAmazon ▸ Is Amazon affected by consumer ethnocentrism? Why or why not? DEPENDS ON THE PRODUCT Agenda.. ▸ Finish Environmental Scan ▸ Work on VB Lessons 1 & 2 ▸ Then you have two options.. ▹ Work ahead in VB OR ▹ Work on something for another class Review Day! Jeopardy! ▸ Get in groups + have Chromebook Agenda.. ▸ Review the Unit 1 Study Guide on Classroom ▹ I recommend taking it until you get a 90% or better ▸ Use Quizlet to review vocab ▸ Work on VB Lessons 1 & 2 ▸ Then you have two options.. ▹ Work ahead in VB OR ▹ Work on something for another class