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187 Cards in this Set
- Front
- Back
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Starbucks Operates |
Tazo Teas, Teavana Chain, Evolution Fresh (Fresh Juices), branded drinks, pastries, ice cream, and Yogurt. |
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Starbucks Markets Through: |
My Starbucks Idea Site (involve consumers) Social Media: Twitter and Facebook Mobile App |
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Marketing |
Creating, Capturing, Commnicating, Delivering Offerings that Have Value for - Customers - Clients - Partners - Society |
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Marketing Plan (BSIIE) |
PLANNING PHASE
Step 1: Business Mission & Objectives Step 2: Situation Analysis using SWOT IMPLEMENTATION PHASE Step 3: Identify Opportunities (Segmentation, Targeting, & Positioning) Step 4: Implementing the Marketing Mix (4 P's) CONTROL PHASE: Step 5: Evaluate Performance Using Marketing Metrics |
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6 Core Concepts of Marketing (CSEPII) |
Marketing: - Creates Value - Satisfies Customer Needs & Wants - Exchange Occurs - Product, Price, Place, and Promotion (Required) - Individual or Organization - Impacts Various Stake Holders |
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Good Marketers seek out potential customers who both have an interest in the product . |
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Exchange
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The trade of things of value between the buyer and the seller so that each is better off as a result. |
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What are the Four P's (aka Marketing Mix) Required when Successfully Marketing?
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Marketing Mix AKA Four P's Product (Creating Value) Price (Capturing Value) Place (Delivering Value) Promotion (Communicating Value) |
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Product:
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Creating Value by developing a variety of offerings, goods, and services, to satisfy customer needs.
Ex: Starbucks & Variety: Lattes, Frappes, cappuccinos, machiattos, hot chocolate, smoothies, teas, bottled juices, refreshers, and regular brewed coffees. |
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Marketing Ideas |
Thoughts, opinions, and philosophies
EX: The exchange of value occurs when the children listen to the sponsors presentation and wear their helmets when bicycling which mean they have adopted or become "purchasers" of the safety idea that the group marketed. |
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Twitter Concierge & Facebook Updates |
Employees that follow and respond to tweets to guests for any information. The interactions rely on the Sol Wave House Application that any registered guest can access and can stay in touch with Twitter Concierge
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Price (Capturing Value) |
Everything that the buyer gives up: Money, time, and or energy in exchange for the product. United Airlines: Price you pay for the ticket directly depends on how far in advance you book your ticket, time of the year, or whether you want to fly coach or business. For Marketers: The Key is to determine a price and figuring out how much customers are willing to pay so that they are satisfied with the purchase and that the seller achieves a reasonable profit. |
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Place (Delivering Value) |
Represents all the activities necessary to get the product to the right customer when that customer wants it.
This is related to Supply Chain Management, Retailing, and Channel Management.
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Promotion(Communicating Value) |
Even the best products will go unsold if marketers cannot communicate their value to customers. Promotion generally can enhance a products or services value.
Collaborative promotions can especially be effective tactics for marketers. particularly if they can team up with popular sports as social and mobile marketing, |
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B2C (Business to Consumer)
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Businesses sell to consumers |
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B2B (Business to Business)
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Businesses sell to other businesses |
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C2C (Consumer to Consumer)
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Consumers sell to other consumers
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Social & Mobile Marketing
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What are partners in the supply chain? |
Wholesalers
Retailers Transportation Warehousing |
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Production Oriented Era
Sales Oriented Era Market Oriented Era Value Based Marketing Era |
Production Oriented Era - 20th century - Concerned with product innovation not with needs of individual consumers. Retail stores considered places to hold merchandise until it sold. |
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Sales Oriented Era |
1920 - 1950 _ Era of Great Depression and World War II which conditioned customers to consume less or manufacture items themselves. |
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Market Oriented Era |
Post World War II Era - US entered a buyers market and consumer became king! Manufactures then focused on what the consumers wanted and discovered marketing. |
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Value Based Marketing Era |
To compete successfully they would have to give their customers greater value, figure out their wants and needs, better than their competitors did. |
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Value |
Reflects the relationship of benefits to costs or what you get for what you give.
Ex: Individuals willing to pay asking prices for all types of goods at all price levels because to those individuals, what they get for what they give is a good value. (Porsche etc) |
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Value Cocreation
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Customers can act as collaborators to create the product or service.
Ex: Nike Allows Customers to Custom Design Their Shoes. Google Lens/ |
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4 Steps to become More Value Driven
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1) Share info about their customers & competitors among own organization
2) Strive to balance their customers benefits & costs. 3) They concentrate on building relationships with customers. 4) They Need to take advantage of new technologies using social and mobile media. |
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Researching and Collecting Data About Customers and Competitiors means a firm is trying to become more __________ _________. |
Value Driven. |
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Corporate Citizenry Examples: |
Developing Greener Products Healthier Foods Safer Products Improving Supply Chains to Reduce Carbon Footprint |
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Importance of Marketing |
Can be Entrepreneurial Enriches Society Prevails across channel members Expands Global Presence |
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A group or firms that make and deliver a given set of goods or services are known as: |
A supply Chain or Marketing Channel. Excellent example of supply chain management is the Partnership between USPS and Amazon which sets it apart from its competitors. |
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In a Volatile market, investors view firms that operate with high levels of corporate responsibility and ethics as ______ investments. |
Safe Investments |
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Entrepreneurs |
People who organize, operate, and assume the risk of a business venture. |
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Great and distinguished entrepreneurs find and understand a marketing opportunity or __ ______ ____. |
The Unfilled Need |
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Great and distinguished entrepreneurs examine the marketplace, develop and communicate the....... |
value of their product and services to potential customers. |
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Through communications, marketers educate and inform customers about the benefits of their products and services and thereby increase their _________ _________. |
perceived value. |
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Delivery of Value |
Making sure the right products and services are available when, where, and in the quantities their customers want. |
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Firms can improve their value by _______ _____, ________ _____, or both. |
Increasing Benefits and Reducing Costs. |
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Firms become value driven by finding out as much as they can about |
Their customers and those customers' needs and wants. They share this information with partners up and down the marketing Channel so that the entire chain collectively can focus on the customer. |
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What is the key to TRUE value-based marketing? |
Design Products and Services that achieve precisely the right balance between benefits and costs. |
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Value-Based Marketers are not worried about how much money they will make on the next sale. They are concerned with..... |
developing a lasting relationship with their customer return again and again. |
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Firms "Do the right thing" ..... (3 things... think FritoLay) |
sponsoring charitable events, seek to reduce environmental impacts, and avoid unethical practices. |
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Starbucks Marketing Plan Example: |
Had to find a way to train baristas to learn how and when to suggest and sell the pastries, and figure out reliable bakeries that could supply pastries to each store. |
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FOUR P's: PRICING (STARBUCKS EXAMPLE) |
Starbucks is counting on the increased use of payment via smartphone app, prepaid cards, and credit cards to take away some of the STING of its relatively high prices. Customers = less sensitive to the PREMIUM PRICES. |
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Nike partnership with apple allows runners with the NIKE + sensor embedded in their shoes to program a collection of songs that matches their distance, time goals, and also saves speed and distance. |
PARTNERSHIPS ARE IMPORTANT |
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Nike FuelPoints |
Provided a means for users to share the fuel points they earned online. |
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Creative Sustainability |
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Nike realized it needed to be more environmentally conscious for three reasons. |
1) When resources become scarcer, competition for them increases. 2) Rising Energy Costs means Nike's Production Costs would rise even further. 3) Would not be limited in its expansion. |
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Nike's New Color Dry System |
Before: 150 Liters of Water to Process 1 KG of Fabric. Chemical Energy Consumption Intensive After: Eliniates Water Completely Reduces Chemical Consumption 63 % Reduction in Energy Consumption |
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Marketing Strategy Identifies what 3 things? |
1) A Firms Target Market 2) A Related Marketing Mix 3) A Bases on Which the Form Plans to Build a Competitive Advantage |
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Sustainable Competitive Advantage |
An advantage the competition that is not easily copied and can be maintained over a long period of time. |
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What is Nike's sustainable competitive advantage? |
Technological Innovation Incorporation |
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Four Macro Strategies that focus on aspects of the MARKETING MIX to create and deliver value and to develop sustainable competitive advantage. |
1) Customer Excellence 2) Operational Excellence 3) Product Excellence 4) Locational Excellence |
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What are 3 ways to sustain a loyal customer base? |
1) having a strong brand 2) Unique Merchandise 3) Superior Customer Service |
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What is key to modern customers retention programs? |
Viewing Customers with a lifetime value proposition rather than on a transaction -by-transaction basis. |
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Loyalty programs fall under what type of management system? |
Customer Relationship Management |
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How can one achieve operational excellence? |
Through Efficient Operations, excellent supply chain management, and strong relationships with their suppliers. |
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Firms with strong relationships with vendors/suppliers may gain exclusive rights to (3 things)
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1. Sell Merchandise in a particular region 2. Obtain Special Terms of Purchase that are not avail to competitors. 3. Receive Popular Merchandise that may be in short supply. |
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How do you achieve product excellence? |
Providing products with high perceived value and effective branding and positioning. |
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Mission Statement: |
A broad Description of a firms objectives and the scope of activities it plans to undertake. Answers: What do we need to do to accomplish our goals and objectives? Includes how a firm is building its sustainable competitive advantage. EX: NIKES MISSION STATEMENT: TO bring inspiration and innovation to every athlete in the world. and with this asterisk defines an athlete by quoting one of its founders: if you have a body, you are an athlete. ADIDAS MISSION STATEMENT: The Adidas group strives to be the global leader in the sporting goods industry with brands built on a passion for the sport and a sporting lifestyle. |
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SWOT Analysis: Addresses External and Internal Environment and __________, __________, and __________ due to CDSTEP. |
Assesses both the internal and external environment in regards to its strengths and weaknesses.
Opportunities Threats Uncertainties due to (Culture, Demographics, Social, Technological, Economic or Political) |
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Elements in a SWOT Analysis Chart |
Company Strenghts (Upper left) - Positive internal Attributes Weaknesses (Upper Right) - Negative Attributes Opportunities (Lower Left) - Positive Aspects of the External Environment Threats (Lower Right) - Negative Aspects of the company's Ext. Envi |
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Market Segment: Consists of Consumers who respond similarly to a firms marketing efforts. After Completing the Situation Analysis or (SWOT) the next step is to identify and evaluate opportunities for increasing sales and profits using ____STP____.
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STP = Segmentation (Process of dividing the market into groups of customers with dif. needs, wants or characteristics who may appreciate products or services geared especially for them. Targeting: After Segmenting Market into groups may target to pursue one or more of the groups. Position: Defines the marketing mix variables so that target customers have a crystal clear, distinctive, desirable understanding of what products a firm offers or represents in comparison with competing products. |
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STP analysis evaluates different _____ opportunities |
growth |
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What is IMC? |
Integrated Marketing Communications represents promotion of the four P's Pg 44 |
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Google claims that it can use a combination of metrics to predict the performance of a major motion picture up to a month prior to the date. Promises a _____% accurate prediction of box office performance. |
94% |
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What are some commonly used metrics to assess performance are revenues, sales, and profits. |
An attempt to maximize one metric may impact another metric. Ex: general mills cereal going on sale to sell volume but profits will hinder. |
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The metrics used to evaluate a forms vary depending on (2 things) |
1) Level of the organizations at which the decision is made 2) The resources the manager controls |
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Boston Consulting Group Matrix |
Circles: Represent brands in direct proportion to annual sales. Stars: (upper left) Occur in high growth markets with high market share products. Migrate from heavy users to heavy generators. Cash Cows: .(Lower Left) Occur in lower growth markets with high market share products.Received heavy investments. Question Marks: (Upper Right) Occur in high growth markets with low market share products. Require excess resources to maintain. Require more marketing and production support. DOGS: (LOWER RIGHT) Occur in Low growth markets and have relatively low market shares. Usually not destined for stardom. |
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Relative Market Share |
Provides managers with a products relative strengths compared with that of the largest firm in the industry. |
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Market penetration Strategy |
Employs the existing marketing Mix and focuses the firms efforts on existing customers. This may be done by attracting new customers to the firms current target market or encouraging current customers to patronize the firm more often and buy more merchandise pm each visit. |
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Market Development Strategy |
Employs existing marketing efforts to each new market segments (domestic or international). |
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Product Development Strategy |
Offers a new product or service to a firms current target market |
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Diversification Strategy |
Offers a new product or service to a market segment that currently is not served. |
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Related Diversification |
The current Target market and or marketing mix shares something in common. ex: same vendors same distribution same info mgmt systems Advertise same newspaper. |
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Unrelated diversification |
Very risky. Do not capitalize on either core strengths associated with markets or with products. |
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Netflixes precise targeting |
Netflix Data Anlaytics 79,000 categories Nearly 30% of Streaming done by Netflix Dreamworks - TO appeal to Children Getting Children on board harder to cancel suncscribition |
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Firms must position their products or services with _______ in mind. Position the product within their minds. |
Consumers |
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Steps in STP Process: (Segmentation, Targeting, and Positioning) |
1. Establish Strategy or Objectives (articulate marketing strategy) 2. Use Segmentation Methods (Geographic, Demographic, Psychographic, Benefits, and Behavioral Segmentation) Use Particular method or methods to segment the market which helps firms better understand the customer profile in each segment.) 3. Evaluate Segment Attractiveness (Marketers first must determine whether the segment is worth pursuing. Is the segment Identifiable: (who in MKT to design their needs) Substantial: (MKT size - too small = not interested) Reachable: (through persuasive communication & distribution) Responsive: (customers must act similarly to firms offering) Profitable: (current & future : growth rate, competitors, entry barriers, market access, product substitutes etc) Segment Profitability = Segment Size X Segment Adoption % X Purchase Behavior X Profit Margin % - Fixed Costs 4. Select Target Market Undifferentiated Targeting Strategy: Focuses on the similarities in needs of customers. (ex: Salt and Sugar) Differentiated Targeting Strategy:Focuses on the differences in needs of customers. (gasoline chevron, Nike) Concentrated Targeting Strategy: When organization selects a single primary target market and focuses all its energies on a product to fit that markets needs. (Newton Running for runners) 5. Identify & Develop Positioning Strategy Market Positioning: involves process of defining marketing mix variables so that target customers have a clear, distinctive, understanding of what the product offers in comparison to competitors. Value Proposition: Which communicates the cstomer benefits to be received from a product or service and thereby provide reasons for purchasing it. Circles for a Successful Value Proposition.... pg 143 Value: Popular Positioning Method due to relationship to price to quality is among the most important considerations. Symbol: Can be used as a positioning tool: (ex: tony the tiger, Nike, Ralph Lauren Polo) Positioning via Perceptual Mapping: Displays in two or more dimensions the position of a product vs competitor. (pg. 147) ^Ideal Points: Larger the circle, larger the market size. |
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Geographic Segmentation: |
Organizes customers into groups on the basis of where they live. (state, city, neighborhood, and zip codes.) |
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Segmentation Methods: |
Geographic: Content: North America, Asia, Europe, and etc)
Demographic: Age, Gender, Income and education. Psychographic: Lifestyle (way we live), Self-concept (image people ideally have of themselves; marketers use this to depict laughing posters), and Self-values (goals for life) Benefits: Convenience, economy, and prestige. Behavioral: Occasion and Loyalty. |
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Demographics may not be useful for defining the target segments for other ___________. |
Companies Ex: Nike assumed athletic wear with younger age groups. They ended up being incorrect as all age groups use the athletic wear. |
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Psychographics:
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How consumers actually describe themselves usually determined by demographics, buying patterns or usage. Psychological Reasons to Buy: A person might have a strong need for inclusion or belonging, which motivates him or her to seek out to fit in with the group. More EXPENSIVE as a means to identify potential customers. |
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The most widely used tool to support psychographic segmentation effort is: Owned and Operated by (SBI)
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Value and Lifestyle Survey (VALS) Strategic Business Insights (SBI)
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What are the 8 segments the VALS Framework are divided into? VALS Framework Indicates Level of Resources Including Income, education, health, energy level, and degree of innovativenes. Consumers buy because of their primary motivations. (How they see themselves in the world and how that self image governs their activities.) |
Innovators Ideals Achievement Self-expression Primary Psychological Motivation Thinkers - Acheivers - Experiencers Believers - Strivers - Makers Survivors |
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Benefit Segmentation |
Groups consumers on the basis of the benefits they derive from products or services. |
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Behavioral Segmentation: |
Divides customers into groups on the basis of how they use the product. Firms focus on building brand loyalty as this translates to higher income. |
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Occasion Segmentation: Loyalty Segmentation: |
Occasion: Parties, weddings, Suits etc. Loyalty: Firms invest in retention and loyalty programs. Firms focus on building brand loyalty as this translates to higher income. |
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Geodemographic Segmentation: What are the two widely used tools for geodemographic segmentation? These can be poweerful tools because customers typically patronize stores _______ __ ____ _______. |
Combination of geographic, demographic, and lifestyle characteristics to classify consumers. Mybestsegments.com (can identify 66 geodemographic segments or neighborhoods) this is by PRIZM - Potential Rating Index by Zip Market) ESRi.com Close to their Neighborhoods |
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PRIZM Clusters (geodemographic tool) pg 134 |
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Calculating: Segment Profitability = Segment Size X Segment Adoption % X Purchase Behavior X Profit Margin % - Fixed Costs Can use this to compare segments: ex: Lawnmower: Homeowner vs Business |
Segment Size:Number of PPL in the segment Segment Adoption Percentage: % of Customers in the segment likely to adopt the product / service Purchase Behavior: Purchase price X # of times customer would buy product in a year. Profit Margin %: Selling Price - Variable Costs / Selling Price Fixed Costs: Advertising Expenditure, rent Utilities, insurance, salaries. |
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Micro marketing or One-to-One Marketing: |
Whena firm tailors a product or service to suit an individuals customers wants and needs. ex: extreme customization - belt buckle example custom suit |
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Internet based company can offer one--to-one or micro-marketing _________ than a brick and mortar. |
cheaper |
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Cookies: |
Small text files a website stores in a visitors browser provide an unique identification of each potential customer who visits and details on how the customer has searched the site. |
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Circles for a Successful Value Proposition.... pg 143 |
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Trademark Infringement: |
Similar Packaging or Logo looking too much alike another. Private label and Store Brands have been challenged for using packaging that appears confusingly similar to that of the national brand leaders in a category. |
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Six Steps to derive a Perceptual Map: |
1. Determine Consumers' Perceptions & Evaluations of the product or service in relation to competitors. 2.Identify the Markets Ideal Points and Size 3. Identify Competitors' Positions 4. Determine Consumer Preferences 5.Select the Position 6. Monitor the Positioning Strategy |
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TO KEEP YOUR CUSTOMERS, KEEP IT SIMPLE TAKEAWAYS |
Marketers ramped up messages to increasingly distracted or disloyal customers in hopes that they can make them loyal customers. -Rising marketing msgs actually overwhelming & Pushing Customers Away. Consumers Want SIMPLICITY. Considered 40 various variables to measure "Sticky" customers. - Price, Cust. Perception, how often Cust. interacted w/ brand. Camera A (all item info, 360, view, and QR code to product website) vs Camera B (search engine approach to better understand at what stage the consumer is and redirect to third party review sites. Nontechnical terms) Camera A may instruct the customer on the cameras capabilities but does little to facilitate an easy decision.
Best tool to measure consumer-engagement efforts is the "decision simplicity index: how easy it is for consumers to gather and understand information about a brand, how much they can trust the information they find and how readily they can weigh their options. Higher its decision simplicity, the higher the score. Consumers need pros and cons & how it'll fit into lives: 2 Challenges arise) 1st: How can mkters detect where a given consumer is on the purchase path and what info he/she most needs 2nd: How to ensure that consumers they direct to 3rd party sites will come back? 70% of those using a mobile device to search are withing a few hours away from making a purchase whereas those using a desktop are a week away. More specified search terms usually mean that a consumer is further along the purchasing process. Haulers: J.C Penny and American Eagle host unbiased haulers on their sites & in digital communications. Penney offers its stars gift gards. This in the field in psychology is a term called Positive Reinforcement. Which encourages consumers to continue the same behavior as it is rewarding. Walt Disney World Moms Panel is a great choice for those seeking tailored advice or ________________ THE LESSON: Build trust worthy advisors rather than simply developing recommenders who will push the brand. Items >$50 - 25% of customers report that most of their effort is spent on product research. 20% say most effort is spent on comparison. Buying Guides make the Mistake of Appearing to Offer Guidance While Complicating the Decision Process. Manufacturing like Crest need to help consumers weigh weighing options. Shoedazzle.com Justfab.com - Collect "personality Information" (heel, size, color, and so on) because consumers are lost likely to purchase recommended items based on their preferences entered. |
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You Need An Innovation Strategy
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Failure to Execute is the reason it is so hard to build and maintain the capacity to innovate. It roots due to the lack of an innovation strategy. Innovation System: A coherent set of independent processes and structures that dictate how the company searches for novel problems and solutions, synthesizes ideas into a business concept and product designs, and selects which projects get funded. A company without an innovation strategy won't be able to make trade-off decisions and choose all the elements of an innovation system. An Explicit innovation strategy helps you design a system to match your specific competitive needs.
Marketing: Opportunities to leverage the brand through complementary products or expand market share through new distribution channels. BUL: Focused on Their Target Markets and their particular P&L pressures. R&D Scientists & Engineers: Tend to see opportunities in new technologies. Without a strategy to integrate and align those perspectives around common priorities, the power of diversity is blunted or worse, becomes self-defeating. Solution: Articulate an innovation strategy that stipulates how their firms innovation efforts will support the overall business strategy. Creating an innovation strategy: Should start with a clear understanding and articulation of specific objectives related to helping the company achieve a sustainable competitive advantage. How innovation will create value for potential customers, how the company will capture that value, and which types of innovation to pursue. Corning: Invests a lot in basic research, a practice that many companies gave up on long ago. Also in manufacturing technology. Corning's Approach to Innovation: "selling keystone components" that significantly improves. Smooth transfer of new technologies from R&D to manufacturing and scale up production. Importance of clearly articulated innovation strategy -- one that's closely linked to a companies business strategy and core value proposition. Corning's customers-partnering strategy helps defend the company's innovations against imitators. One of the best ways to preserve bargaining power in an ecosystem and blunt imitators is to continue to invest in innovation. Routine Innovation: Builds on a companies existing technological competence and fits with its existing business model / customer base. Disruptive Innovation: A category named by Clay Christensen, requires a new business model but not necessarily a technological breakthrough. EX: Open source software (for software , video on demand (for DVD rental services), ride-sharing services (for taxi and limousine.) Radical Innovation: Opposite of disruptive innovation. Challenge is purely technological. EX: Biotechnology, Jet Engines, and Fiber Optic Cable. Architectural Innovation: Combines technological and business model disruptions. EX: Digital photography, internet searches, personalized medicine.. Robust innovation strategy should answer the following questions: Saves them Money Provides Some Larger Societal Benefit Like Improved Health or Cleaner Water, it is to creating value. Choosing what type of value your innovation will create and sticking to it is critical. Change Management. Ex: Apple focuses its innovation efforts on making its products easier to use than competitors' and providing a seamless experience across its expanding family. Apple: Consistently focuses its innovation efforts on making its products easier to use than competitors and providing a seamless experience across its expanding family of devices and services. Designs complementarities between its devices and services so that an iPhone owner finds it attractive to use an iPad rather than a rivals tablet. Contact Lens Company: leaders decided to focus less on routine innovations and on adding color tint and modifying lens design and obtaining new materials for better acuity and design. R&D expenditures focusing on existing products (demanded by marketing to starve off mounting short tem losses in shares.) and to process improvements (demanded by manufacturing to reduce costs, which was, in turn demanded by finance to preserve margins as prices fell. Were not able to sustain producing consistently at a high volume because it invested in the requisite capabilities. Crowdsourcing: rather than rely on your own few experts to solve specific innovation problems, open it to the anyone (the crowd). EX: innocentive and invites solutions, perhaps offering a financial prize. Does not always work because customers don't always know what they want but a great tool in the tool box to use. Cornings Demand-Pull: Developing technology and then finding ot creating market - most suitable when market does not exist yet. Supply-Push Approach: Finding customers highly challenging problems and then figuring out how the company's cutting edge technology can solve them) is limited by customers imagination and willingness to take risks. |
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Redbull
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Product Branding & Packaging Decisions Wants brand to be known and sponsors events such as space jump. Fun , little crazy, and ready for anything. Letting sponsored events speak in their behalf. |
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Product
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Anything that is of value to a consumer and can be offered through a voluntary marketing exchange. |
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Core Customer Value |
Defines the basic problem-solving benefits that consumers are seeking. |
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Actual Product: |
Converting core customer value into an actual product |
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Associated Services aka Augmented Product |
warranties financing product support after-sale service |
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Two Primary Categories of Products & Services that reflect who buys them:
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Consumers or businesses. |
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Consumer Products
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Products & Services used by people for their personal use.
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Specialty Products/Services
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which customers express such a strong preference that they will expend considerable effort to search for best suppliers.
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Shopping Products / Services
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from which sonsumers will spend a fair amount of time comparing alternatives such as furniture, apparel, fragrances, appliances, and travel alternatives.
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Convenience Products / Services
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Which consumer is not willing to expend any effort to evaluate prior to purchase.
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Unsought Products / Services |
Consumer's either do not normally think of buying or do not know about.
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Product Mix
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Complete set of all products and services offered by a firm. |
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Product Lines: |
Groups of associated items that consumers tend to use together or think of as part of a group of similar products or services. |
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Breadth
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Number of Product Lines offered by a firm. (Adding or Subtracting an Entire Product Line) |
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Depth (ex: BMW 1,2,3,4,5,6,7 Series) |
# of Products within a product line. Increase or Decrease Depth by adding or subtracting a few product lines |
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Why is Branding so Important
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Branding Enable Customers to Differentiate 1 firm from another. Brands Establish Loyalty Brands Protect from Competition & Price Competition Brands are Assets (Princess Marcella Revlon Example pg 168) Brands affect market value & have impact on bottom line |
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What are the 6 Branding Elements Used to Raise Brand Awareness (BULCSJ)
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URLS: Logos & Symbols: Characters: Slogans: Jingles/Sounds: |
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Brand Equity |
The set of assess and liabilities linked to a brand that add to or subtract from the value provided by the product or service
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4 Aspects of a brand determine its equity: |
Brand Awareness: Measures how many consumers in MKT familiar with the brand and what it stands for and have an opinion about it. Perceived Value: Relationship between a product/service benefit and its cost. Brand Associations: Mental and emotional links that consumers make between a brand and its key product attributes. Brand Loyalty: Occurs when a consumer buys the same brand repeatedly even if rival product goes on sale. Why is brand loyalty important? -Customer Relationship Management(CRM) -Marketing costs lower because they don't have to reach out to loyal customers -Loyal customers = good word to mouth -High brand loyalty insulates firm from competition |
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Manufacturer Brands aka |
National Brands |
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Private-Label Brands aka
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Retailer / Store Brands
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Family Brand
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Individual Brands benefit from overall brand. (Kellogg's) |
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Individual Brand
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Names for each product individually. |
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Brand Extension
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(ex: FritoLay chips and dips and markets them under FritoLay/ Tostitos Brands) Unsuccessful Brand Extensions: - Cheetos Lip Balm - Lifesaver Soda - Colgate Kitchen Entrees - Bic (disposable underwear) |
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Line Extension: |
Use of the same brand name within the same product line and represents an increase in a product line depth. |
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Co-Branding
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(ex: Yum brands combines two or more of its locations into one place.) |
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Brand Licensing
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(Brand licensing common in toys, apparel, accessories, and entertainment products like video games.) |
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TO avoid negative consequences of brand extensions firms look at the following:
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Evaluate consumer perceptions of the attributes of the core brand and seek out similar attributes for the extension because brand specific associations are very important to extensions. |
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Licensing
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Licensing is an effective form of attracting visibility for the brand and thereby building brand equity while also generating additional revenue. Risks: Overexposure diluting brand equity by misutilizing brand name or characters. |
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Brand Repositioning or "Rebranding"
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Recent in news: General Mills, Olive Garden, The Gap, and Tropicana. |
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Primary Packaging
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ex: toothpaste tube, Morton salt 100th bday. |
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Secondary packaging: |
wrapper or exterior carton that contains the primary package and provides the UPC label. COnsumers can find addl info located on these than what is mentioned on primary. Add convenience for: carrying, using, and storing the product. Whether primary or secondary, they play key role in ATTRACTING consumers attention. |
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Which administration is the primary federal agency that reviews food and package labels to ensure that the claims made by the manufacturer are true?
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FDA |
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SERVICES: THE INTANGIBLE PRODUCT CH 13
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Samsung big on customer service via Twitter
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Often can respond within an hour to unhappy customers |
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Why do companies use twitter to reach out to unhappy customers? |
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Customer service
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refers to human or mechanical activities firms undertake to help satisfy their customers needs and wants.
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Services account for ____ percent of the US GDP. |
76%! |
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Why has dependence of service related economies developed?
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1. Less expensive to manufacture/service from less developed countries. 2. Ppl place high value on convenience and leisure. 3. People are demanding more Specialized Services |
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What are the 4 Core differences that separate Services from Goods? (HIIP)
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Services are: Inseparable: Services are produced and consumed at same time. Ex haircut. Cant try the haircut before actually getting it. Intangible: cannot be touched, tasted, or seen. (difficult to market and convey benefits -usually use symbols or images) ex: dentists, physicians, Heterogeneous: Variability in the service quality. Ex: hairstylist performances the AM vs Afternoon. Perishable: Cannot be stored for use in the future. (cant stock pile your gym membership for use in the future) |
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Service Gap
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When delivery of a service fails to meet the consumers expectations.
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Knowledge Gap
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difference between customers expectations and firms perception of those customer expectations.
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Standards Gap |
difference between the firms perception of customers' expectations and the service standard it sets. |
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Delivery Gap
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Difference between firms services standards and actual service it provides to customers. |
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Communication Gap |
Difference Between the actual service provided to customers and the service that the firms promotion program promises.
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What can you do to know what your customers want to reduce the knowledge gap?
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Undertake customer research. Responsive to correct customer complaints. Gather information at point of sale. (survey review etc.) |
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Customers generally use 5 distinct service dimensions to determine overall service quality: (RRATE)
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1. Reliability: 2. Responsiveness: 3. Assurance: 4. Empathy: 5. Tangibles: |
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Voice of Customer Program (VOC)
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collects customers' expectation's regarding their desired service and the min level of acceptable service. |
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Zone of Tolerance (pg 200)
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Difference between what the customer really wants and what he or she will accept before going elsewhere. To Define a Zone of Tolerance, Firms Ask: 1. Desired and expected level of service for each dimension from low to high. 2. Customers' perceptions of how well the focal services performs and how well a competitive service performs from low to high. 3. Importance of each service quality dimension. |
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In general, more employees will buy into a quality-oriented process if they are involved in setting the goals.
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Empowerment
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Allowing employees to make decisions about how service is provided to customers. Empowerment becomes more important when service is more individualized. |
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What are 4 ways that management needs to support service providers in several ways and give them incentives?
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1. Coworkers need to provide emotional support to service providers. 2. Instrumental support: systems & equipment necessary to deliver service adequately. 3. Management support must be consistent and coherent. 4. Reinforcing customer service programs by providing rewards/incentives for excellent service. |
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Communication gap can be reduced by managing customer expectations by promising only what you can deliver, or possibly even a little less. |
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Effective Service Recovery: |
- In many cases customers may just want to be heard. 2. Providing Fair Solutions - Keep Customer Perceptions in Mind 3. Resolving the Problem Quickly -Be Responsive or Even Better Yet Proactive |
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Distributive Fairness
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Customers perception of the benefit he or she received compared with the cost (inconvenience or loss) |
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Procedural Difference
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Perceived fairness of the process used to resolve them. |
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When companies promote their brand through multiple channels they stand a _________ chance of reaching their customers. That's where __________ ________ comes into play. Although using multiple channels may provide to be tricky to keep ___________ _________.
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Integrated Marketing Brand Consistency |
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Coca-Cola has used a new approach to reach target markets by utilizing a _____ _______ approach.
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personalized package (Mike, Suzy, and Dave.) Customized Song Download related to birth year. |
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Integrated Marketing Communication |
Represents the Promotion "P" of the four P's. It Encompasses a variety of communication disciplines - advertising, personal selling, sales promotion, public relations, direct marketing, and online marketing. 3 Elements of IMC: The Consumer: The Channels: (Through Which Msg. is Communicated) Evaluation: (of the results) |
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IMC Communication Process (firm): Sender (firm): Transmitter (Marketer - In house or 3rd party): Encoding: Communication Channel: Receiver (consumer): Noise: Feedback Loop: |
Sender(firm): The message originates from the sender who must be clearly identified to the intended audience Transmitter: In house or 3rd party): Communication Channel: Receiver (consumer): Noise: Feedback Loop: . |
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AIDA Model (aka think, feel, do method.)
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A wareness Aided Recall (Top of mind awareness) ex mickey mouse ears I nterest Once Existence known communication must work to increase his or her level of interest. D esire - Move consumer frome I"I like it" to "I want it". ex: Shows promotion |
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Brand Awareness
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Potential customer ability to recognize or recall that the brand name is a particular type.
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Aided Recall (Top of mind awareness)
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When consumers indicate they know the brand when the brand is presented to them.
ex; Mickey mouse ears related to Disney. |
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Lagged Effect
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A delayed response to a marketing communication campaign. Usually takes several exposures before a consumer fully processes its message.
(this makes measuring an effect of the message difficult) |
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Two Axes of IMC: (pg 283)
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Online:
Offline: Interactive: Persuasive: |
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Advertising:
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The placement of announcements and persuasive messages in time or space purchased in any of the mass media by business firms, nonprofit organizations, government agencies, and individuals.
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Public Relations
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is the organizational functions that manages the firms communications to achieve a variety of objectives, including building, and maintaining a positive image, handling or heading off unfavorable stories or events, and maintaining positive relationships with the media.
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Sales Promotions
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are special incentives or excitement building programs that encourage the purchase of a product or service such as coupons, rebates, contests, free samples, and point of purchase displays.
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Personal Selling:
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2 way flow of communications between a buyer and a seller that is designed to influence the buyers purchase decision.
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Direct Marketing |
Marketing that communicates directly with target customers to generate a response or transaction. Info used to track customer purchases and then to direct advertisements based off of data. Directly related to CRM. (Mail, email, or mobile marketing.) |
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Mobile Marketing |
Marketing through wireless handheld devices such as cellular telephones. |
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Blogs |
Contains periodic posts on a common web page. A well-received blog can communicate trends, announce special events, create positive word of mouth, connect customers by forming a community, allow the company to respond directly to customer comments-and develop a long-term relationship with the company |
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Social Media |
Refers to Media Content distributed through social interactions.(ie. Facebook, YouTube, and Twitter) |
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Objective-and-task method
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determines the budget required to undertake specific tasks to accomplish communication objectives. Prior to using this marketers establish a set of communication objectives. |
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Rule of Thumb Method |
Use prior sales and communication activities to determine the present communication budget. (IP Maskers and Re routers like Hide My Ass can alter these analytic.) Competitive Parity: Communication budget = its share of the market Percentage-of-Sales: Fixed Percentage of Forecasted Sales Available Budget: MKTers forecast their sales and expenses excluding communications. Thus Communication budget is money available after operating costs and profits have been budgeted. |
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Frequency (of exposure): |
how often the audience is exposed to a communication within a specific period of time. |
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Gross Rating Points (GRP) |
Which Represents Reach Multiplied by Frequency.
GRP = Reach x Frequency (Ex: reach 50% of customers X # of ads) 50 x 7 = 350 GRP |
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Web Trafficking Software |
Which measures how much time viewers spend on particular web pages, # of pages they view, how many times users click banner ads, which website they came from, and so on. Ex: Google Analytic Facebook (helps companies view who have been visiting their fan pages, what they are doing on fan pages, and who is clicking their ads. By knowing who visits their fan pages a marketer can better target and determine his target market. |
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Social Shopping |
Use of internet to communicate about product product preferences with other shoppers. Ex: Using CRM systems to re-reach out to customers and match merchandise to entice a sale. |
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Search Engine Marketing (SEM) (PG: 294 Ex 18.7) |
Google AdWords: Allows advertisers to show up in the "Sponsored Links" Section of the search results. Impressions: # of times the ad appears in front of user Relevance: How relevent the ad message is to the user. Higher score = that a keyword will trigger ads in a higher position and at a lower cost-per-click. Click-Through-Rate: Divide # of X a user clicks the ad by # of times user sees impressions. ROMI = Gross Margin - Marketing Expenditures / MKT Expend |
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Program Effectivness Results: (pg. 295 ex 18.8) |
Awareness: Knowledge: Attitude: Visit: |
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Focus on Brand, Image: Subtle Messages by producing documentaries without mentioning brand name but mentioning it throughout film or documentary. |
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Advertising
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a paid form of communication delivered through media from an identifiable source about an organization, product, service, or idea designed to persuade the receiver to take some action now or in the future. |
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TO remember or an ad IT must pertain grab your attention and MUST be relevant to you otherwise you will screen out the message and not remember it.
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7 STEPs in PLANNING & EXECUTING an Ad Campaign: |
Do Research to Select Target Market 2. Set Advertising Objectives: Advertising Plan: a subsection of overall strategy; analyzes marketing advertising situation, identifies objectives, clarifies specific strategies for accomplishing those objectives, and determines how to measure if firms campaign was successful. 3. Determine the Advertising Budget: 4. Convey the Message: 5. Evaluate & Select Media: 6. Create Advertisements: 7. Assess Impact: |
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Push Strategies:
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Focus on wholesalers, retailers, or salespeople. |
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Pull Strategies: |
TO get Customers to pull the product into marketing channel by demanding it.
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Persuasive Advertising: Reminder Advertising: Institutional Advertising: Product-Focused Advertisements: Public Service Advertising: Social Marketing: |
Persuasive Advertising: When a product has gained a certain level of brand awareness - firms use this to motivate consumers to take action. Reminder Advertising: Is a communication used to remind or prompt re-purchases, especially for products that have gained market acceptance and are in the maturity stage of their cycle. Institutional Advertising: Inform, persuade, or remind consumers about issues related to place, politics, or an industry. Product-Focused Advertisements: Inform, Persuade, or remind consumers about a specific product or service. Public Service Advertising: PSA focus on public welfare; generally they are sponsored by nonprofit institutions. Social Marketing: Defined as the application of marketing principles to a social issue to bring about attitudinal and behavioral change among the general public or a specific population segment. |
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First S
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