chapter 3 objectives the marketing environment describe the environmental forces that affect the...
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Chapter 3 ObjectivesThe Marketing Environment
Describe the environmental forces that affect the company's ability to serve its customers.
Explain how changes in the demographic and economic environment affect marketing decisions.
Identify the major trends in the firm's natural and technological environments.
Explain the key changes in the political and cultural environment.
Discuss how companies can react to the marketing environment.
Microenvironment:internal forces
Company
Suppliers
MarketingIntermediaries
Customers
Publics
Competitors
Company
The Company
Topmanagement
Finance
R & D Purchasing
Manufacturing
Accounting
Marketing
Microenvironment:internal forces
Company
Suppliers
MarketingIntermediaries
Customers
Publics
Competitors
Company
Macroenvironment:external forces
Demographic
Economic
Natural
Technological
Political
Cultural
Company
Demographics
Family
Population Shift
Education
Increasing Diversity
Demographics:Changing Age Structure in Canada
Median age up from 25 to 38 in 30 yearsLong-term slowing of birth rate (1.55)Increasing life expectancy“Baby dearth” of the 70’s Population bulge due to baby boomGrowth rates vary for different age groups
Canada’s Boomer Bulge
Demographics
BOOMERS 40 plus age now 45% bigger than 18-30 group …will be 60% bigger by 2010 1989 40+ became biggest adult segment in history Control 50%+ of discretionary spending Control 75% of nation’s wealth About to inherit largest intergenerational wealth
transfer in history
Demographic Environment:Increasing Diversity
Ethnicity: Ethnic purchasing power
$300 billion Growing market size Avoid stereotyping Use native languages Choose ethnic media
Sexual orientations Disabilities
Macroenvironment:external forces
Demographic
Economic
Natural
Technological
Political
Cultural
Company
Economics
Changes in Income
More Work = Less Leisure people are time starved
Changing Consumer Spending Patterns
Consumer Confidence
Consumer confidence fell to its lowest level since October 1983. Conference Board, Feb. 2003
Consumer Confidence
Consumer confidence tanked in February and has been rebounding since. Decima Research, 2003
Natural Environment
Shortages of Raw Materials
Increased Pollution
Increased Government Intervention e.g. Environmental Protection Act
Technological Environment
Fast pace of technological change
High R&D Budgets
Political Environment
Legislation regulating business
increased legislation
increased emphasis on ethics and socially responsible actions
Cultural Environment
Persistence of cultural values
Shifts in cultural values
Subcultures
Microenvironment:internal forces
Company
Suppliers
MarketingIntermediaries
Customers
Publics
Competitors
Company
Chapter 18 ObjectivesMarketing and Society
Identify the major social criticisms of marketing.
Define consumerism and environmentalism and explain how they affect marketing strategies.
Describe the principles of socially responsible marketing.
Explain the role of ethics in marketing.
Social Criticisms of Marketing
Marketing’s Impact on Consumers
High Prices * Deceptive Practices * High-Pressure Selling
Shoddy Products * Planned Obsolescence * Poor Service
Social Criticisms of Marketing
Marketing’s Impact on Society
False Wants/Too Much Materialism * Too Few Social Goods
Cultural Pollution * Too Much Political Power
Consumerism
The right to safety Right to be informed The right to choose The right to be heard The right to redress
against damage The right to consumer
education
Consumer’s Association of Canada Fundamental Rights
Chapter 4 ObjectivesMarketing Research and Information Systems
Explain the importance of information to the company.
Define the marketing information system and discuss its parts.
Outline the four steps in the marketing research process.
Compare the advantages and disadvantages of various methods of collecting information.
Discuss the special issues some marketing researchers face.
Measuring & Forecasting Demand
1. As marketing manager for Cat's Pride cat litter, you have seen sales jump 50 percent in the last year after years of relatively stable sales. Explain how you will forecast sales for the coming year.
2. What are some leading indicators that might help you predict sales of diapers, cars, and hamburgers. Can you describe a general procedure for finding leading indicators or product sales?
The Importance of Information
Research Needs
MarketingEnvironment
Customer Needs and Wants
Strategic Decision Making
Competitors
Should you do Research?
NO if: being done before financial analysis complete a way to avoid making a decision results are not going to change your plans cheaper to try idea than conduct research
YES if: data will be useful in a very specific way you can get the information you need to make decisions you can’t afford to make an uniformed decision you must convince others of something you already
know
Market Research Process
Defineproblemandresearchobjectives
Developplantocollectdata
Implementcollectand analyzedata
Interpretandreportfindings
4-2
Step 1: defining the problem & research objectives
Exploratory research preliminary information helps better define problem
Descriptive research expand understanding of factors
Causal research test cause and effect hypothesis
Step 2: developing the plan for collecting information
Determine Specific Information Needs, e.g. Target customer characteristics Patterns of product use (which day-part?) Demand factors Response of marketing channels Customer reactions Projected sales
Step 2: developing the plan for collecting information
Gathering Secondary Data internal sources government sources books and periodicals commercial data services international data on-line databases and the internet syndicated research studies
Step 2: developing the plan for collecting information
Gathering Primary Data
Research Approaches Observational Survey: phone, mail, in-person Experimental
Primary Data CollectionContact Methods: strengths & weaknesses
Mail Questionnaire
Telephone Interview
Personal Interview
Large volume, Low costHonest answers, Slow,Not very flexible
Fast, Controlled sample,Flexible, Higher Response,More expensive, Bias
Very flexible, Fast, Very expensive, Bias
Step 3: implementing the research plan
Plan is put into actionmost expensive part of the process so:
1) important to watch for interviewer bias
2) accuracy
Step 4: interpreting and reporting findings
Present important findingsCompany ultimately must decide on
correct interpretation and how to proceed
Difficulties in Asking Questions of ConsumersDo they really know whether they are
likely to buy a particular product?
Even if they know the answer, will they tell you?
Will their actual purchase behaviour mirror their stated interests/intentions?
Chapter 5 ObjectivesConsumer Markets and Consumer Buying BehaviourDefine the consumer market and construct
a simple model of consumer buyer behaviour.
Name the four major factors that influence consumer buyer behaviour.
List and understand the stages in the buyer decision process.
Describe the adoption and diffusion process for new products.
Factors Affecting Consumer Behaviour
Cultural
Culture
Sub-culture
Socialclass
Social
Referencegroups
Family
Rolesand
status
Personal
Age andlife-cycle
OccupationEconomicsituationLifestyle
Personalityand
self-concept
Psycho-logical
MotivationPerceptionLearning
Beliefs andattitudes
Cultural Factors
CultureSocial Class Sub-culture
Social Factors
Groupsreference groupsaspirational groups
Family Roles & Status
Personal Factors
Age & Lifecycle StageOccupationEconomic situation Personality & Self-ConceptLifestyle
Psychological Factors
MotivationPerceptionLearningBeliefs & Attitudes
Physiological needs
Safety needs
Esteem needs
Self-Actualtization
Socialneeds
VALS2 Lifestyle Classification
Achievers
Strivers
Actualizers
Strugglers
Experiencers
Makers
Fulfilleds
Believers
Abundant Resources
Minimal Resources
Principle Oriented
StatusOriented
Action Oriented
Buyer Decision Process
Needrecognition
Purchasedecision
Purchasedecision
Evaluation ofalternatives
Evaluation ofalternatives
Post-Purchasebehaviour
Post-Purchasebehaviour
Informationsearch
Types of Buying Behaviour
Complexbuying
behaviour
Complexbuying
behaviour
Variety-seeking
behaviour
Variety-seeking
behaviour
Dissonancereducing
behaviour
Dissonancereducing
behaviour
Habitualbuying
behaviour
Habitualbuying
behaviour
Low involvementHigh involvement
Significantdifferencesbetween brands
Few differencesbetween brands
Adopter Categorization:relative time of adoption
Time of adoption of innovations
2.5%Innovators
34%Early
majority
34%Latemajority
Earlyadopter
s
13.5%
16%Laggards
Chapter 6 ObjectivesBusiness Markets and Business Buying BehaviourDefine the business market and explain how
business markets differ from consumer markets.
Identify the major factors that influence business buyer behaviour.
List and define the steps in the business buying-decision process.
Compare the institutional and government markets and explain how institutional and government buyers make buying decisions.
Characteristics of Business Markets
Differences BetweenBusiness
andConsumerMarkets
Market Structure and Demand
Nature of theBuying Unit
Types of Decisions &the Decision Process
Other Characteristics
Characteristics of Business Markets
Differences BetweenBusiness
andConsumerMarkets
Market Structure and Demand
1. Fewer but larger buyers2. More geographically concentrated3. Demand is more inelastic4. Demand is derived5. Demand fluctuates quickly
Characteristics of Business Markets
Differences BetweenBusiness
andConsumerMarkets
Nature of theBuying Unit
1. Involves more buyers2. More professional purchasing procedures
Characteristics of Business Markets
Differences BetweenBusiness
andConsumerMarkets
Types of Decisions &the Decision Process
1. More complex2. More formal3. Buyer-seller relationships more dependent, long-term relationships
Characteristics of Business Markets
Differences BetweenBusiness
andConsumerMarkets
Other Characteristics
1. Buy direct v.s. via retailer2. Practice reciprocity3. Often lease v.s. purchase
Business Buying Influences
Level ofprimary demand
Economicoutlook
Cost of money
Supplyconditions
Rate of techno-logical change
Political,regulatory
developments
Competitivedevelopments
Objectives
Policies
Procedures
Organizationalstructure
Systems
Authority
Status
Empathy
Persuasive-ness
AgeEducation
OccupationPersonality
Risk attitudes
Environmental
Interpersonal
Organizational
Individual
Business Buying Process
1. Problem Recognition
2. General Need Description
3. Product Specification
4. Supplier Search
5. Proposal Solicitation
6. Supplier Selection
7. Order Routine Specification
8. Performance Review
Institutions & Government
Institutional Markets
Government Markets
Low BudgetsCaptive Patrons
CentralizedBuying
Submitted Bids
PublicReview
Outside Publics
Non-economicCriteria
Chapter 7 ObjectivesSegmentation, Targeting, Positioning
Define the three steps of target marketing: segmentation, targeting, positioning.
List and discuss the major levels of market segmentation and the bases for segmenting consumer and business markets.
Explain how companies identify attractive market segments and choose a market-coverage strategy.
Explain how companies can position their products for maximum competitive advantage.
Steps in Market Segmentation, Targeting, and Positioning
Market segmentation1. Identify bases for
segmenting the market
2. Develop profiles ofresulting segments
Market targeting3. Develop measures of
segment attractiveness
4. Select the target segment(s)
Market positioning
6. Develop marketing mixfor each target segment
5. Develop positioningfor each target segment
Segmenting: 4 bases
GeographicDemographicPsychographicBehaviouristic
Segmenting: geographic base
Divide market into separate geographic units
Nations, regions provinces, cities, neighbourhoods, etc.
Develop appropriate marketing programs
Segmenting: demographic base
Most popular method Divide market into
groups based on: age sex family size & lifecycle income & occupation education religion ethnic background
Demographics - age
14% of population over 65 90% of 50+ are debt free 48% of all luxury cars sold
are purchased by 50+ group
50+ age group controls 80% of Canada’s personal wealth up have 2/3 of disposable income 25% of population
Most healthy and active
Segmenting: psychographic base
Social class determines choice of
home, car, clothes, leisure habits, etc.
Lifestyle reflected in purchases e.g. couch potatoes,
sports enthusiasts, or symphony lovers
Personality express who they are
Segmenting: behavioural base
Divide market into groups based on: Occasions User Status Usage Rate Loyalty Status Benefits sought
Requirements for effective segmentation
Requirements for Effective
Segmentation
Measurability
Substantiality
Actionability
Accessibility
Requirements for effective segmentation
Measurability - size, purchasing power, profiles of segments
Accessibility - effectively reach and serveSubstantiality - segments are large or
profitable enough to serveActionability - effective programs can be
designed to attract segments
Market Targeting:evaluating market segments
Segment size and growth
Structural attractiveness
Company objectives and resources
Company marketing mix Market
Undifferentiated marketingUndifferentiated marketing
Company marketing mix 1
Company marketing mix 2
Company marketing mix 3
Segment 1
Segment 3
Segment 2
Differentiated marketingDifferentiated marketing
Segment 1
Segment 3
Segment 2Company marketing mix
Concentrated marketingConcentrated marketing
Selecting Market Segments
Positioning
Defined by consumers on important attributes
Place in mind relative to competing products
Position happens - planned or not
Positioning Strategy:choosing and implementing
Communicate anddeliver chosen position
Communicate anddeliver chosen position
Select the rightcompetitive advantage
Select the rightcompetitive advantage
Identify possiblecompetitive advantage
Identify possiblecompetitive advantage
Select an overall positioning strategy
Select an overall positioning strategy
Positioning
G
Against aCompetitor
Against aCompetitor
UsageOccasions
UsageOccasions
Away fromCompetitors
Away fromCompetitors
ProductAttributes
ProductAttributes
ProductClass
ProductClass
BenefitsOffered
BenefitsOffered
UsersUsers
B D
C
G
F
A
E
Positioning Statement
For (target customer)Who (statement of need or opportunity)The (product name) is a (product category)That (statement of key benefit)Unlike (primary competitive alternative)Our product (statement of primary
differentiation)
Chapter 8 ObjectivesProduct Strategies
Define product and the major classifications of products and services.
Describe the roles of product and service branding, packaging, labelling, and product support services.
Explain the decisions companies make when developing product lines and mixes.
Identify the four characteristics of a service. Discuss the additional marketing
considerations that services require.
Levels of Product
Corebenefit
orservice
Augmented productAugmented productInstallation
After- Sale
service
Deliveryand
credit
Warranty
Brandname
Quality level Design
Features
Packaging
Core productCore product
Actual productActual product
8-1
Product Classifications:consumer products
Types ofConsumerProducts
Convenienceproducts
Shoppingproducts
Specialtyproducts
Unsought products
Product Decisions
Branding
Productattributes
Packaging
ProductSupportservices
Labelling
Product Attributes
QualityFeaturesSizesDesign
Product Support Services
Services that augment the actual product
e.g. 1-800 support for software program
e.g. web/Internet technical support
Branding
Name, term, sign, symbol or design or a combination intended to identify goods or services of a seller or group to differentiate them from competitors
Brand Name Selection:desirable qualities
Suggest benefits and qualities
Easy to pronounce recognize & remember
Distinctive Translated easily Capable of
registration & legal protection
Craftsman
Major Branding DecisionsTo brand ornot to brandTo brand ornot to brand
• Brand• No brand• Brand• No brand
Brand nameselection
Brand nameselection
Brand sponsorBrand sponsor
Brand strategyBrand strategy
Brandrepositioning
Brandrepositioning
• Selection• Protection• Selection• Protection
• Manufacturer’s brand• Private brand• Licensed brand• Co-branding
• Manufacturer’s brand• Private brand• Licensed brand• Co-branding
• New brands• Line extensions• Brand extensions• Multibrands
• New brands• Line extensions• Brand extensions• Multibrands
• Brand repositioning• No brand repositioning• Brand repositioning• No brand repositioning
Figure 8- 3
Value of Branding
Helps consumers shop more efficiently
Aids repeat purchase
Suggests quality of product
Creates store loyalty Gives legal protection Helps in segmenting
markets Symbol of ongoing
promise
Buyer’s viewpoint Seller’s viewpoint
Packaging/Labelling
What should the package do for the product?
identify, describe,
and promote Elements support
position & strategy Environmental
issues?
Chapter 9 Objectives
New Product Development and Life Cycle StrategiesExplain how companies find and develop
new product ideas.List and define the steps in the new-product
development process.Describe the stages of the product life
cycle.Describe how marketing strategies evolve
during the product’s life cycle.
New Product Development Process:
Idea generation
Idea screening
ConceptDevelopment
& testing
Marketingstrategy
9-1
Marketing Strategy Development
Part one Target market Planned product positioning Sales, market share and profit goals (short term)
Part two Outline price, distribution and first year marketing budget
Part three Planned long-run sales Profit goals Marketing mix strategy
New Product Development Process:
Idea generation
Idea screening
ConceptDevelopment
& testing
Marketingstrategy
Businessanalysis
Productdevelopment
Commercialization
Test marketing
9-1
Why do new products fail?
Overestimated market or target market is too small
Poor design Poor product quality Incorrect positioning Error in pricing Poor marketing
communication Competition
Product Life-Cycle Strategies
Profits
Sales
Development Introduction
Growth
Maturity
Decline
SalesProfit($)
Loss($)
9-2
New Product Life Cycle Strategies
Introduction
MarketSkimming
MarketPenetration
New Product Life Cycle Strategies
Growth
NewFeatures
ImproveQuality
AddChannels
NewSegments
New Product Life Cycle Strategies
Maturity
ProductModification
Market Modification
Modify Marketing Mix
New Product Life Cycle Strategies
Decline
Maintain Harvest Drop
Chapter 10 ObjectivesPricing Strategies
Identify and define the internal factors affecting a firm’s pricing decisions.
Identify and define the external factors affecting pricing decisions.
Contrast the three general approaches to setting prices.
Describe the major strategies for pricing new products.
Discuss the key issues related to price changes.
Factors Affecting Pricing
Internal factors• Marketing objectives• Marketing-mix strategy• Costs• Organizational considerations
Internal factors• Marketing objectives• Marketing-mix strategy• Costs• Organizational considerations
External factors• Nature of the market & demand• Competition• Other environmental factors (economy, resellers, government)
External factors• Nature of the market & demand• Competition• Other environmental factors (economy, resellers, government)
Pricingdecisions
Pricingdecisions
Internal Factors
Internal factors• Marketing objectives• Marketing-mix strategy• Costs• Organizational considerations
Internal factors• Marketing objectives• Marketing-mix strategy• Costs• Organizational considerations
Pricingdecisions
Pricingdecisions
External Factors
External factors• Types of markets• Price-demand relationship• Competition• Other environmental factors (economy, resellers, government)
External factors• Types of markets• Price-demand relationship• Competition• Other environmental factors (economy, resellers, government)
Pricingdecisions
Pricingdecisions
Demand Curves
PP’’22
PP’’11
QQ11QQ22
PP11
PP22
QQ’’11QQ’’22
Quantity demandedQuantity demandedper periodper period
Inelastic demandInelastic demand
Quantity demandedQuantity demandedper periodper period
Elastic demandElastic demand
Pric
eP
rice
External Factors
External factors• Types of markets• Price-demand relationship• Competition• Other environmental factors (economy, resellers, government)
External factors• Types of markets• Price-demand relationship• Competition• Other environmental factors (economy, resellers, government)
Pricingdecisions
Pricingdecisions
General Pricing Approaches
1. Cost-Based Approaches
Cost-Plus Break-Even Target ProfitPricing Analysis Pricing
General Pricing Approaches
1. Cost-Based Approaches
2. Value-Based Approaches
Perceived Value Pricing
General Pricing Approaches
1. Cost-Based Approaches
2. Value-Based Approaches
Going-Rate Pricing Sealed-Bid Pricing
3. Competition-Based Approaches
New Product Pricing Strategies
setting a high price to maximize revenue
makes sense when: product quality and image
supports a higher price costs of producing a small
volume are not too high to cancel the advantage of charging more
company has a patent or technological advantage
Market Skimming
Setting a low price to attract a large number of buyers and gain a dominant market share
makes sense when: market is highly price sensitive (low price stimulates
sales and market growth) production costs must fall as volume increases low price must be an effective entry barrier for
competitors
New Product Pricing Strategies
Market Penetration
Product-Mix Pricing
Strategies
Product Line Pricing
$49.99$89.99
$129.99
$149.99$189.99
Product-Mix Pricing
Strategies
Product Line Pricing
Captive Product Pricing
Product-Mix Pricing
Strategies
Product Line Pricing
Captive Product Pricing
Product Bundle Pricing
PriceAdjustment
Strategies
Discount & Allowance Pricing
International Pricing
Segmented Pricing
Psychological Pricing
Promotional Pricing
Geographical Pricing
Chapter 11 ObjectivesDistribution Channels and Logistics ManagementExplain why companies use distribution
channels and explain the functions that these channels perform.
Discuss how channel members interact and organize to perform the work of the channel.
Identify the major channel alternatives.Discuss the nature and importance of
physical distribution Analyze integrated logistics management.
Chapter 12 ObjectivesRetailing and Wholesaling
Explain the roles of retailers and wholesalers in the distribution channel.
Describe the major types of retailers and give examples of each.
Identify the major types of wholesalers and give examples of each.
Explain the marketing decisions facing retailers and wholesalers.
Distribution (Place)
Good distribution is critical to the marketing success of products
Three main types of channels: Direct Indirect Hybrid
Consumer Marketing Channels
Manu-facturerManu-
facturer
DirectDirect
Whole-saler
Whole-saler
RetailerRetailer
RetailerRetailer
ConsumerConsumer
Manu-facturerManu-
facturer
Manu-facturerManu-
facturer
Manu-facturerManu-
facturer JobberJobber
Whole-saler
Whole-saler ConsumerConsumer
ConsumerConsumer
ConsumerConsumer
RetailerRetailer
IndirectIndirect
IndirectIndirect
IndirectIndirect
Hybrid Marketing Channel
Consumersegment 1Consumersegment 1
Businesssegment 1Businesssegment 1
Consumersegment 2Consumersegment 2
Businesssegment 2Businesssegment 2
RetailersRetailers
DealersDealersDistributorsDistributors
ProducerProducer
Catalogues, telephoneCatalogues, telephone
Sales forceSales force
Distribution Channel Functions
Information: gathering and distributing marketing research
Promotion Contact: finding and communicating with
prospective buyers Matching offers to buyer’s needs Negotiation Physical distribution, financing, risk taking
Why Use Marketing Intermediaries?
An intermediary reduces the number of channel transactions
# of contacts without a distributorM x C = 3 x 3 = 9
# of contacts with a distributorM x C = 3+ 3 =6
Franchiseorganizations
Franchiseorganizations
AdministeredVMS
AdministeredVMS
Retailercooperatives
Retailercooperatives
Wholesaler-sponsoredvoluntary
chains
Wholesaler-sponsoredvoluntary
chains
ContractualVMS
ContractualVMS
CorporateVMS
CorporateVMS
Manufacturer-sponsoredretailerfranchise
Manufacturer-sponsoredwholesalerfranchise
Service-firm-sponsoredfranchise
Figure 12-4
Vertical Marketing Systems (VMS)
Major Logistics Functions
Nature of Distribution
Order Processing
Warehousing
Transportation
Inventory
Chapter 13 ObjectivesIntegrated Marketing Communication Strategy
Name and define the five tools of the promotion mix.
Discuss the processes and advantages of integrated marketing communications.
Outline the steps in developing effective marketing communication.
Explain the methods for setting the promotion budget and factors that affect the design of the promotion mix.
Promotion Mix
Advertising
Direct Marketing
Personal Selling
Public RelationsSales Promotion
Promotion Mix
Marketing Communications Mix
Advertisingpaid placement of a message in the
medianon-personal presentation and
promotion of ideas, goods, or servicesidentified sponsor
Marketing Communications Mix
Sales Promotionshort-term incentives to encourage the sale of a product or
service
Marketing Communications Mix
Personal Sellingpersonal presentation by a firm’s
sales forcefor the purpose of making sales and
building customer relationships
Marketing Communications Mix
Public Relationsfree placement of a message in the mediaon-going process of building good
relations with the company’s various publics by: obtaining favourable publicity building a good corporate image handling stories or events heading off unfavorable rumours
Marketing Communications Mix
Direct Marketingdirect communications with carefully
targeted individual consumersto obtain an immediate response
using mail, telephone, fax, e-mail and other non-personal tools
1. Identify the target audience
Steps in DevelopingEffective Communication
1. Identify the target audience
2. Determine the desired response
Steps in DevelopingEffective Communication
Buyer-Readiness Stages
AwarenessAwareness KnowledgeKnowledge LikingLiking
PurchasePurchaseConvictionConvictionPreferencePreference
1. Identify the target audience
2. Determine the desired response
3. Design a message
Steps in DevelopingEffective Communication
Designing a message
Message Contentrational - emotional - moral appeal?
Message Structureopen vs. conclusion? one side or two sides?
Message Formatwords - images - colour - sounds - expressions?
1. Identify the target audience
2. Determine the desired response
3. Design a message
4. Choose the media
Steps in DevelopingEffective Communication
Choosing media
Personal channels face to face, phone, email, mail allows personal contact and feedback
Non-personal channels major media e.g. print, radio, tv, etc. no personal contact or feedback Opinion leaders key to reaching
others
Choosing Advertising Media
1. Reach
# of people in your target market reached
2. Frequency
how often people in your target market
see your promotions
3. Impact
1. Identify the target audience
2. Determine the desired response
3. Design a message
4. Choose the media
5. Select the message source
Steps in DevelopingEffective Communication
Selecting the message source
Credible sources more persuasive
Credible people, e.g. doctors, dentists, health-care providers
Celebrity endorsers
1. Identify the target audience
2. Determine the desired response
3. Design a message
4. Choose the media
5. Select the message source
6. Collect feedback
Steps in DevelopingEffective Communication
Setting the Promotion Budget
Affordable methodPercent of salesCompetitive parityObjective and task
Chapter 14 ObjectivesAdvertising, Sales Promotion and Public RelationsDefine the roles of advertising, sales
promotion, and public relations in the promotion mix.
Describe the major decisions involved in developing an advertising program.
Explain how sales promotion campaigns are developed and implemented.
Explain how companies use public relations to communicate with their publics.
Promotion Tools
The Nature of Each
PromotionTool
AdvertisingLegitimate Public
Repetition Expensive
Promotion Tools
The Nature of Each
PromotionTool
AdvertisingLegitimate Public
Repetition Expensive
Personal SellingEffective Costly
Two Way Relationships
Promotion Tools
The Nature of Each
PromotionTool
AdvertisingLegitimate Public
Repetition Expensive
Personal SellingEffective Costly
Two Way Relationships
Sales PromotionTiming Incentive
Short Term
Promotion Tools
The Nature of Each
PromotionTool
AdvertisingLegitimate Public
Repetition Expensive
Personal SellingEffective Costly
Two Way Relationships
Sales PromotionTiming Incentive
Short Term
Public RelationsCredibilityUnder Used
Campaign evaluation
Communicationimpact
Sales impact
Campaign evaluation
Communicationimpact
Sales impact
Message decisions
Message strategyMessage execution
Message decisions
Message strategyMessage execution
Budget decisionsAffordable approach
Percent of salesCompetitive parityObjective and task
Budget decisionsAffordable approach
Percent of salesCompetitive parityObjective and task
Objectives settingCommunication
objectivesSales
objectives
Objectives settingCommunication
objectivesSales
objectives
Media decisionsReach, frequency, impact
Major media typesSpecific media vehicles
Media timing
Media decisionsReach, frequency, impact
Major media typesSpecific media vehicles
Media timing
Figure 15-1
Major Advertising Decisions
Stage in Product
Life CyclePush or Pull
Setting the Promotion Mix
Factors in Setting the Promotion Mix
Type of MarketBuyer
Readiness
Relative importance Relative importance
Advertising
Sales promotion
Personal selling
Public Rel.
Personal selling
Sales promotion
Advertising
Public Rel.
Consumer Goods Industrial Goods
Type of Market
Stage in Product
Life CyclePush or Pull
Setting the Promotion Mix
Factors in Setting the Promotion Mix
Type of MarketBuyer
Readiness
Push versus Pull Strategy
Retailers andWholesalers
Retailers andWholesalers ConsumersConsumers
ConsumersConsumersRetailers andWholesalers
Retailers andWholesalersProducerProducer
ProducerProducer
Producermarketing activities
Resellermarketing activities
Push strategy
Pull strategy
Producer marketing activities
Demand Demand
Stage in Product
Life CyclePush or Pull
Setting the Promotion Mix
Factors in Setting the Promotion Mix
Type of MarketBuyer
Readiness
Chapter 15 ObjectivesPersonal Selling
Discuss the role of a company’s salespeople in creating value for customers and building customer relationships.
Explain how companies design sales force strategy and structure.
Explain how companies recruit, select, and train salespeople.
Describe how companies compensate and supervise salespeople and how they evaluate sales-force effectiveness.
Discuss the personal selling process.
Steps in Effective Selling
Prospectingand
qualifying
Prospectingand
qualifyingPre-approachPre-approach ApproachApproach
Presentationand
demonstration
Presentationand
demonstration
Follow-upFollow-upClosingClosingHandlingobjections
Handlingobjections
Chapter 16 ObjectivesDirect and Online Marketing
Discuss the benefits of direct marketing to customers and companies and the trends fuelling its rapid growth.
Define a customer database and list the four ways that companies use databases in direct marketing.
Identify the major forms of direct marketing. Compare the two types of online marketing channels
and explain the effect of the Internet on e-commerce. Identify the benefits of online marketing to consumers
and marketers and the four ways that marketers can conduct online marketing.
Discuss the public policy and ethical issues facing direct marketers.
What is Direct Marketing?
Communications with carefully targeted individual consumers to obtain an immediate response Cultivate relationships Often one-to-one
interactive Precise targeting More effective results
Customersand
prospects
Customersand
prospects
Face-to-faceselling
Face-to-faceselling
Tele-marketing
Tele-marketing
Direct mail
Direct mail
KioskKiosk
OnlineOnline
DirectResponse
TV
DirectResponse
TV
CatalogueCatalogue
Forms of Direct Marketing
Figure 17-1
Chapter 8 ObjectivesProduct Strategies
Define product and the major classifications of products and services.
Describe the roles of product and service branding, packaging, labelling, and product support services.
Explain the decisions companies make when developing product lines and mixes.
Identify the four characteristics of a service.Discuss the additional marketing
considerations that services require.
Marketing is the process
of helping others value your service.
Services are Different
SERVICES
Intangibleservices cannot be seen,
tasted, felt, heard orsmelled before purchase
Services are Different
SERVICES
Inseparableservices cannot be
separated from theirproviders
Services are Different
SERVICES
Variability(Inconsistency)
quality of services depends
on who provides them and
when, where and how
Moments of Truth
Execs
Front Line Employees
Middle Management
customers
Services are Different
SERVICES
Perishability(Inventory)
services cannot be storedfor later sale or use
Services are Different
SERVICES
Intangibleservices cannot be seen,
tasted, felt, heard orsmelled before purchase
Variablequality of services
dependson who provides them
andwhen, where and how
Inseparableservices cannot be
separated from theirproviders
Perishableservices cannot be stored
for later sale or use
Service-Profit Chain
Which is most important?
customersstockholdersemployees
Chapter 17 ObjectivesThe Global Marketplace
Discuss how the international trade system, economic, politico-legal, and cultural environments affect a company’s international marketing decisions.
Describe three key approaches to entering international markets.
Explain how companies adapt their marketing mixes for international markets.
Identify the three major forms of international marketing organization.
DecidingWhether to go international
DecidingWhether to go international
Decidingwhich markets
to enter
Decidingwhich markets
to enter
Looking at theglobal marketing
environment
Looking at theglobal marketing
environment
Deciding on theglobal marketing
program
Deciding on theglobal marketing
program
Deciding on theglobal marketing
organization
Deciding on theglobal marketing
organization
Deciding howto enter the
market
Deciding howto enter the
market
Major Decisions in International Marketing
Global Marketing Environment
International Trade System Tariffs Quotas Embargos Exchange controls Non-tariff trade barriers
Global Marketing Environment
Economic Environment Income distribution Industrial structure:
- subsistence economies
- raw-material exporting economies
- industrializing economies
- industrial economies
Global Marketing Environment
Politico-Legal & Ethical Environment Attitude toward foreign businesses Extent of government bureaucracy Political stability Monetary regulations Countertrade
Compensation Counterpurchase
Global Marketing Environment
Cultural Environment Language, customs Folkways, norms, taboos Business norms & behaviour
e.g. Personal distance
e.g. Meeting and greeting
DecidingWhether to go international
DecidingWhether to go international
Decidingwhich markets
to enter
Decidingwhich markets
to enter
Looking at theglobal marketing
environment
Looking at theglobal marketing
environment
Deciding on theglobal marketing
program
Deciding on theglobal marketing
program
Deciding on theglobal marketing
organization
Deciding on theglobal marketing
organization
Deciding howto enter the
market
Deciding howto enter the
market
Major Decisions in International Marketing
DecidingWhether to go international
DecidingWhether to go international
Decidingwhich markets
to enter
Decidingwhich markets
to enter
Looking at theglobal marketing
environment
Looking at theglobal marketing
environment
Deciding on theglobal marketing
program
Deciding on theglobal marketing
program
Deciding on theglobal marketing
organization
Deciding on theglobal marketing
organization
Deciding howto enter the
market
Deciding howto enter the
market
Major Decisions in International Marketing
DecidingWhether to go international
DecidingWhether to go international
Decidingwhich markets
to enter
Decidingwhich markets
to enter
Looking at theglobal marketing
environment
Looking at theglobal marketing
environment
Deciding on theglobal marketing
program
Deciding on theglobal marketing
program
Deciding on theglobal marketing
organization
Deciding on theglobal marketing
organization
Deciding howto enter the
market
Deciding howto enter the
market
Major Decisions in International Marketing
Market Entry Strategies
Exporting
DirectIndirect
Joint venturing
LicensingContract manufacturingManagement contracting
Joint ownership
Direct investment
Assembly facilitiesManufacturingfacilities
Amount of commitment, risk, control, and profit potentialAmount of commitment, risk, control, and profit potential
DecidingWhether to go international
DecidingWhether to go international
Decidingwhich markets
to enter
Decidingwhich markets
to enter
Looking at theglobal marketing
environment
Looking at theglobal marketing
environment
Deciding on theglobal marketing
program
Deciding on theglobal marketing
program
Deciding on theglobal marketing
organization
Deciding on theglobal marketing
organization
Deciding howto enter the
market
Deciding howto enter the
market
Major Decisions in International Marketing
Develop newproduct
Communicationadaptation
Communicationadaptation
Dualadaptation
Dualadaptation
Productinvention
Productinvention
Straightextension
Straightextension
Productadaptation
Productadaptation
Adaptproduct
Don’t changeproduct
Don’tChangepromotion
Adaptpromotion
Product
Pro
mot
ion
International Product & Promotion Strategies
Develop newproduct
Communicationadaptation
Communicationadaptation
Dualadaptation
Dualadaptation
Productinvention
Productinvention
Straightextension
Straightextension
Productadaptation
Productadaptation
Adaptproduct
Don’t changeproduct
Don’tChangepromotion
Adaptpromotion
Product
Pro
mot
ion
International Product & Promotion Strategies
DecidingWhether to go international
DecidingWhether to go international
Decidingwhich markets
to enter
Decidingwhich markets
to enter
Looking at theglobal marketing
environment
Looking at theglobal marketing
environment
Deciding on theglobal marketing
program
Deciding on theglobal marketing
program
Deciding on theglobal marketing
organization
Deciding on theglobal marketing
organization
Deciding howto enter the
market
Deciding howto enter the
market
Major Decisions in International Marketing
Global Marketing Organization
Methods of Organizing International Marketing Operations
Export Department
InternationalDivision
GlobalOrganization