Marketplace Notes PDF

Notes on the "Introduction to Marketing Final Review" Core Marketing Concepts 1. Marketing Strategy ○ Marketing logic for creating customer value and profitable relationships. ○ Key aspects: Segmentation and targeting (choosing customers). Dif...

Notes on the "Introduction to Marketing Final Review" Core Marketing Concepts 1. Marketing Strategy ○ Marketing logic for creating customer value and profitable relationships. ○ Key aspects: Segmentation and targeting (choosing customers). Differentiation and positioning (how to serve them). 2. Importance of Strategy ○ Enables competitive advantage. ○ Aligns company strengths against competitors effectively. ○ Includes trade-offs and aligning activities for a unique position (Michael Porter’s insights). 3. Market Differentiation & Positioning ○ Involves determining a product’s position in the customer’s mind. ○ Effective differentiation criteria: important, distinctive, superior, communicable, pre-emptive, affordable, and profitable. ○ Value proposition: “Why should I buy your brand?” VOCAB - Marketing Strategy The logic by which a company creates customer value and achieves profitable relationships through segmentation, targeting, differentiation, and positioning. - EX: Apple creates customer value through high-quality, innovative products (e.g., iPhone) and maintains profitable relationships with a loyal customer base by targeting tech-savvy users and differentiating through sleek design and advanced technology. - Segmentation Dividing a market into distinct groups of buyers with different needs, characteristics, or behaviors. - EX: A car company divides its market into segments like economy cars for budget-conscious buyers, luxury cars for affluent consumers, and electric cars for eco-conscious customers. - Recreation, Speed, Mountain - Targeting Selecting which segments of the market the company will focus on. - EX: Nike targets active individuals and athletes, focusing specifically on runners and fitness enthusiasts with their advertising campaigns and product lines.  - Differentiation Creating unique and superior value for customers to distinguish the brand from competitors. - EX: Tesla differentiates its vehicles with long-range electric batteries, cutting-edge autonomous technology, and over-the-air software updates. - Positioning Establishing a product’s place in the minds of consumers relative to competitors. - EX: Volvo positions itself as the leader in safety-focused vehicles, appealing to families and safety-conscious buyers. - Value Proposition The full mix of benefits on which a brand is positioned, answering, "Why should I buy your brand?" - EX: Warby Parker’s value proposition is “glasses you’ll love, at a price you can afford,” offering stylish eyewear and convenience through online shopping. Marketing Management Five key functions: 1. Analysis (research). 2. Planning (strategy, marketing mix). 3. Implementation (actioning plans). 4. Organization (monitoring progress). 5. Control (evaluating results). VOCAB - Competitive Advantage A position of superiority over competitors achieved by offering greater value, either through lower prices or providing more benefits. - EX: Amazon's competitive advantage lies in its vast logistics network, enabling fast delivery and a seamless customer experience. - Michael Porter’s Strategy Principles Trade-offs: Choosing what not to do. ○ EX: Southwest Airlines avoids serving meals or assigning seats to keep costs low and efficiency high. Fit: Aligning activities to reinforce each other. ○ EX: IKEA aligns its activities (self-assembly products, in-store childcare, and minimalist designs) to reinforce its affordable, functional furniture brand. Unique Position: A different set of activities to deliver unique value. ○ EX: Peloton created a unique position as a high-tech fitness equipment provider offering live-streamed classes.  - Operational Efficiency Actions aimed at improving internal processes rather than gaining a competitive edge. - EX: Walmart achieves operational efficiency through advanced supply chain management, reducing costs while maintaining low prices. Contents of a Marketing Plan 1. Executive Summary: Main goals and recommendations. 2. Current Market Situation: Target market and company positioning. 3. Threats and Opportunities: External challenges and chances for growth. 4. Objectives and Issues: Clear marketing objectives and challenges. 5. Marketing Strategy: Engagement and customer value strategies. 6. Marketing Actions: Specific implementation programs. 7. Budget: Profit and loss projections. 8. Controls: Monitoring and evaluating return on investment (ROI). VOCAB - Executive Summary A brief overview of the main goals and recommendations in a marketing plan. - EX: A company developing a smartwatch summarizes its plan to target tech enthusiasts and health-conscious individuals with features like fitness tracking and notifications. - Current Market Situation Analysis of the target market, customer needs, product review, competitors, and distribution trends. - EX: Starbucks evaluates its market position by analyzing customer preferences for specialty coffee and competition from Dunkin' and local cafes. - Threats and Opportunities Analysis Identifies external factors that could positively or negatively affect the business. - EX: An electric car manufacturer identifies government incentives as an opportunity and battery supply chain issues as a threat. - Marketing Actions Specific programs to implement the strategy, including timelines, responsibilities, and costs. - EX: A skincare brand plans influencer collaborations, social media ads, and product launch events to engage customers. - ROI (Return on Investment) A measure of the profitability of marketing efforts. - EX: A company spends $10,000 on Google Ads and tracks $50,000 in resulting sales, yielding an ROI of 400%. Pricing Strategies Pricing impacts both economic value and brand perception. Strategies can focus on transactional (short-term profit) or relational (long-term partnership) views. VOCAB - Transactional Pricing Focused on maximizing profits from individual purchases. - EX: A hotel charges a premium price for last-minute bookings during peak travel season. - Relational Pricing Aims to build long-term customer relationships. - EX: A subscription service like Netflix offers discounts to long-term members to build loyalty. Advertising Media Measures: ○ Reach (% of target audience exposed). ○ Frequency (number of exposures). ○ Impact (quality of exposure). ○ Engagement (consumer involvement). VOCAB - Reach The percentage of the target audience exposed to an advertisement. - EX: A national TV ad campaign reaches 60% of the target audience aged 18-35. - Frequency The number of times the target audience is exposed to the message. - EX: A YouTube ad runs five times per week to reinforce its message with viewers. - Impact The qualitative value of a message’s exposure. - EX: An emotional Superbowl ad has a lasting impression, associating the brand with family values. - Engagement The degree to which the audience interacts with the content. - EX: A TikTok challenge by a clothing brand encourages users to create videos showcasing their outfits. Sales Promotions Enhance product value by reducing cost or adding benefits. Help attract new customers and reward existing ones. VOCAB - Consumer Sales Promotions Techniques designed to enhance product value or reward customer loyalty Brand Strategy 1. Branding integrates every marketing activity. 2. A product's design and packaging should enhance brand perception. 3. Advertising serves as storytelling to create and shift audience perception. 4. Channels and touchpoints play a role in shaping brand culture. VOCAB - Brand Strategy The deliberate use of all marketing elements to build and enhance brand perception. - EX: Coca-Cola’s brand strategy emphasizes happiness and togetherness through global campaigns and iconic packaging. - Touchpoints Any interaction between the customer and the company (e.g., retail stores, social media, websites). - EX: Apple creates touchpoints through its retail stores, website, product packaging, and Genius Bar support. - Moments of Truth Critical points during customer interactions that shape their perception of the brand. - EX: A customer receives excellent service during a hotel check-in, forming a positive perception of the brand. - Brand Culture The shared meaning and associations created by a brand through its products, messaging, and customer experiences. - EX: Patagonia’s commitment to sustainability shapes its brand culture, attracting environmentally conscious customers. Connecting to Customers Use narratives and social purposes to build loyalty. Increasing importance of purpose-driven business. Customer Engagement Built through touchpoints and moments of truth. Measured in four dimensions: 1. Cognitive: Awareness of brand values. 2. Emotional: Favorability toward the brand. 3. Behavioral: Frequency and quality of customer interactions. 4. Social: Recommendations and engagement on platforms. VOCAB - Cognitive Engagement The customer’s knowledge of brand values, offerings, and locations. - EX: Customers recognize Nike’s "Just Do It" slogan and associate it with athleticism and motivation. - Emotional Engagement The customer’s positive feelings toward the brand and excitement for its products. - EX: Fans of Disney feel excitement and nostalgia when experiencing its parks, movies, and merchandise. - Behavioral Engagement Observable customer actions, such as website visits and purchases. - EX: A loyal customer frequently visits Starbucks' app to order coffee and earn rewards points. - Social Engagement Customer interactions on social platforms, including recommendations and conversations. - EX: Customers post pictures of their meals from a trendy restaurant on Instagram and tag the brand. Consumer Buyer Behavior Focus on how end consumers respond to marketing efforts. Influences include cultural, social, economic, and technological factors. Marketers control 4Ps (product, price, place, promotion) and 4Es (experience, engagement, exchange, evangelism). VOCAB - Consumer Black Box The internal processes (biases, judgments, preferences) that influence customer decisions.  - EX: A customer chooses a specific detergent brand due to personal preferences, family influence, and prior experiences. - 4Ps of Marketing Product, Price, Place, Promotion. - EX: A fast-food chain offers (Product) a new burger, priced competitively (Price), available at convenient locations (Place), and advertised via social media (Promotion). - 4Es of Marketing Experience, Engagement, Exchange, Evangelism. - EX: A fitness brand focuses on (Experience) immersive classes, (Engagement) through community-building apps, (Exchange) with value-for-money products, and (Evangelism) from brand ambassadors. - Subculture A group within a larger culture that shares specific values and experiences. - EX: The skateboarding subculture influences Vans' product design and marketing approach. Competitive Benchmarking Involves analyzing competitors' strengths and weaknesses to build strategy. Online activity has expanded tools and metrics for competitor analysis. VOCAB - Competitive Marketing Intelligence Systematic monitoring and analysis of competitors and market trends. - EX: A beverage company monitors competitor promotions and new product launches to adjust its marketing strategies. Post-Pandemic Marketing Strategy Firms must adapt to rapid changes in customer expectations and supply chains. Focus on adaptability, prediction, and resilience. Crisis management and strategic agility are critical for long-term success. VOCAB - Adaptability The ability to adjust strategies based on changing circumstances. - EX: Restaurants adapted during the pandemic by introducing online ordering and contactless delivery.  - Resilience The capacity to withstand market disruptions and recover quickly. - EX: A logistics company recovers quickly from supply chain disruptions by diversifying suppliers. - Prediction Using tools to anticipate industry changes and tipping points. - EX: A clothing retailer anticipates a shift to sustainable fashion and invests in eco-friendly materials. Why Marketing Matters Marketing assigns meaning to products and services through narratives. It connects cultural, social, and linguistic constructs to consumer behavior.