Transcript Document 7115548
CHAPTER 11: MARKETING
Building Profitable Connections with Your Customers
MARKETING IS MORE THAN ADVERTISING
Marketing – a set of processes for creating, communicating, and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders.
UTILITY
Form Utility
The ability of goods and services to satisfy wants.
Time Utility Place Utility Ownership Utility
THE SCOPE OF MARKETING: IT’S EVERYWHERE People Marketing Place Marketing Event Marketing Idea Marketing
THE EVOLUTION OF MARKETING: FROM THE PRODUCT TO THE CUSTOMER
THE CUSTOMER: FRONT AND CENTER
Customer Relationship Management (CRM) Limited Relationships Full Partnerships
Value Customer Satisfaction Customer Loyalty
MARKETING STRATEGY
WHERE ARE YOU GOING AND HOW WILL YOU GET THERE?
THE ENVIRONMENT IS CONSTANTLY CHANGING
When low carbohydrate diets swept through American culture, retail sales of french fries plummeted, dropping 2.9% in 2001, 3.3% in 2002, and 10% in 2003.
TARGET MARKET
A Well Chosen Target Market:
Size Profitability Accessibility Limited Competition
CONSUMER MARKETS VS BUSINESS MARKETS
Consumer Markets
Products for personal consumption.
How will the buyer use the product?
Business Markets
Products used directly or indirectly to produce other products.
Different approaches to select target markets.
ANALYZING PROMOTIONAL STRATEGIES
MARKET SEGMENTATION
Selecting a target market begins with dividing your market into segments.
Marketers may select multiple segments to target.
CONSUMER MARKET SEGMENTATION
Demographic
Geographic
Psychographic
Behavioral
BUSINESS MARKET SEGMENTATION
• Geographic • Customer-based • Product-use based
TURN UP THE VOLUME ON NAGGING: MARKETING TO KIDS Advertising directly to kids in the United States is a $15 billion business Kids under 13 influence about $600 billion in family spending each year Media-savvy kids often don’t notice the pitches A scary result: 53% of kids say buying certain products makes them feel better about themselves
THE MARKETING MIX
THE GLOBAL MARKETING MIX
Do you need to change your marketing mix for every country?
Most consumer products require a new marketing mix for each global market.
GRASS ROOTS MARKETING IS A BUNCH OF BULL...RED BULL
Red Bull launched in Europe in 1987 They gave away cases of the product to student advocates and encouraged them to throw a PARTY!
They stayed connected with their young target market, becoming popular in bars Red Bull launched in the US in 1997 They still employ Word-of-Mouth strategies
CUSTOMER BEHAVIOR: DECISIONS, DECISIONS, DECISIONS
Consumer Behavior
How people act when they are buying products.
CONSUMER DECISION MAKING PROCESS
Need Recognition Information Search Evaluation of Alternatives Purchase Decision Postpurchase Behavior
INFLUENCE IN DECISION MAKING Cultural: Values, attitudes, customs, social class Social: Family, friends & reference groups Personal: Demographics, personality Psychological: Motivation, attitudes, perceptions, learning
BUSINESS BUYER BEHAVIOR
Rationale Criteria Specific Purchase Criteria Objective Standards Input from Multiple Internal Sources Formal Process Frequently Seek Customized Goods
MARKETING RESEARCH: SO WHAT DO THEY REALLY THINK?
Monitor and predict customer behavior Evaluate and improve marketing mix Better marketing decisions More value for consumers More profits for business
Conducting Market Research
6.
7.
8.
1.
2.
3.
4.
5.
Define the problem Access available information Gather additional information Review internal records; interview employees Collect outside data Organize and interpret data Make a decision and take action Assess the results of the action
Define the Problem
List the possible causes Eliminate any that can not be measured Beware of symptoms
Your company has missed its revenue targets
Symptom – sales declined Possible causes: Have your customers changed?
Have their tastes changed?
Have their buying habits changed?
Have you changed your product?
Are there new competitors?
Gathering Information
Assess what you already have available If you need more… Stay as close to home as possible Sales records Complaints Receipts Credit records Ask your employees
MARKETING RESEARCH DATA
Secondary Data: Existing Data Lower Cost Primary Data: New Data that is Compiled More Expensive May not be Specific Frequently Outdated Available to Competitors Customized Fresh, New Proprietary Already published material Trade associations Direct mail Questionnaires Telephone or street surveys Panel studies Test marketing
Organizing and Interpreting Data
Prioritize the data with the most important on top What strategies are suggested?
How can they be accomplished?
How are they different from what I’m doing?
What current activities should be increased?
What current activities should be decreased or dropped?
Making Decisions and Taking Action
Prioritize each possible strategy from the standpoint of: Immediate goal to be achieved Cost to implement Time to accomplish Measurements Select those with the greatest impact Develop tactics to implement
Assess the Results
Analyze your progress measures Adjust if necessary At the conclusion..
Did you achieve your goal ?
Should the decision be renewed or expanded ?
COLOR ME HUNGRY?
Surrounding customers with red, yellow, and orange encourages them to eat a lot quickly and leave.
• Marketing researchers found that American consumers associate red with energy, passion, speed, and hunger. • Yellow suggests happiness and warmth; orange suggests playfulness, fun, affordability.
A MAJOR MARKETING SHIFT: SOCIAL RESPONSIBILITY Marketers have responded to social demands: Setting higher standards for environmentalism Abolishment of sweatshops Involvement in the community Many companies have begun to employ green marketing
GO GREEN
Target consumers who buy based on their convictions
A MAJOR MARKETING SHIFT: TECHNOLOGY Technology has revolutionized marketing Power has shifted from producers to consumers Customers have 24/7 access to information Marketers have an abundance of promotional opportunities Companies can mass customize products for customers
Sales Forecast
Assess how the total market will perform What is the overall economic climate ?
Assess your performance and market share Will customers make decisions on the same basis they have in the past ?
How will your competitors perform Will there be new competitors ?
Will they introduce new products ?
Will some competitors leave the market ?
Foundation Simulation
Customers
Product Questions:
What do the customers want?
What are the characteristics of the product that are important to customers?
What is the most important product characteristic • In the low tech segment?
• In the high tech segment?
What is “perceived age” of a product?
How is reliability measured?
What will increase material costs?
Pricing Questions:
What do the customers want?
What is the price range for low tech products?
What is the high tech price range?
If Demand is greater than Supply, what is the impact on sensor prices? If Supply is greater than Demand, what is the impact on sensor prices?
Promotional mix
You will invest money in a “promotion” budget and create “awareness”. It relates to your advertising efforts.
The awareness you create is specific to a single product.
You will invest money in a “sales” budget and create “access” to your products.
Accessibility applies to the segment, not the product Sales Budget is spent on distribution, order entry, customer service, etc.