Transcript marketing concept

MKT 304
Principles of Marketing
Marketing Strategy and Role
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Announcements
• Those who missed last class to pick up
course outline and complete first in
class exercise by today.
• Please register for the discussion forum
if you have not done so. Of course,
feel free to post comments and ideas.
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Marketing Evolution
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Simple trade era (before Industrial Revolution)
– Trade of “surplus” output;
– Focus: Sell surplus
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Production era (Industrial Revolution to 1920s)
– “If we can make it, it will sell”;
– Focus: Increase supply
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Sales era (1930s to 1950s)
– Business success = sell, sell, sell … ;
– Focus: Beat Competition
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Marketing department era (1950s)
– Short-term marketing plan and limited integration;
– Focus: Coordinate and Control
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Marketing company era (since 1960s)
– Implementation of the marketing concept.
– Focus: Long run customer satisfaction
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• The “Marketing Concept”
The marketing concept means that an
organization as a whole should seek to
make a profit by serving the needs of it
customers.
Total
Customer
Satisfaction
Company
Effort
The
Marketing
Concept
Profit
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The Marketing Concept & Customer Value
Take Customer’s
Point of View
Customer May
Not Dwell On
Value
Costs
Benefits
Where Does
Competition Fit?
Customer Value
Builds
Relationships 5
Putting It All Together
Superior
Customer Value
Total Company
Effort to Satisfy
Customers
Customer
Acquisition
Profitable
Relationships with
Customers
Customer
Satisfaction
Customer
Retention
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© 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Marketing Management
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MARKETING MANAGEMENT PROCESS--the process of (1) planning
marketing activities, (2) directing the implementation of the plans, and
(3) controlling these plans.
STRATEGIC (MANAGEMENT) PLANNING—the managerial process of
developing and maintaining a match between an organization’s
resources and its market opportunities.
Adjust Plans
as Needed
Marketing Planning
Set Objectives
Evaluate Opportunities
Plan Marketing Strategy
Dev plans & programs
Control Marketing
Plan(s) and Program
Whole-Company
Strategic
Management
Planning
Implement Marketing
Plan(s) and Program
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Marketing Strategy
• Target Market
– A group of customers to appeal.
• Marketing Mix
– Product;
– Pricing;
– Distribution (Place);
– Promotion.
• Note: customer is not part of the
marketing mix!
The
Marketing
Mix
C
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Product Strategy
• Are there different types of customers in the
market?
• What do these different segments want?
• Which segment should we target?
• How can we “position” our product toward this
segment?
• How broad of an assortment of products
should we offer?
• What are the appropriate quality levels?
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Pricing Strategy
• How price sensitive are potential customers?
• What are our competitors charging for similar
products?
• What is the minimum price we need to charge to
cover our variable costs of production and some
of our fixed costs?
• What price level would be consistent with the
desired positioning for our products?
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Distribution (Place) Strategy
• What channel should we use to distribute
our products?
• What intensity should we deploy in the
distribution of our products?
• How many “middlemen” should there be
between us and our final customers?
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Promotion Strategy
• What should we communicate about our
products to potential customers?
– Eg:
Attributes, Image, Technology etc
• How should we communicate to our potential
customers?
– Eg:
Personal Selling, Mass Selling, Sales
Promotion
• What specific media should we use to
communicate?
– Eg:
Sleep Country USA
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Attribute Promotion
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Marketing Mix & The Customer
Product
Price
Customer
Place
Promotion
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In a Nutshell…………
Product
Physical Goods
Service
Features
Quality Level
Accessories
Installation
Instructions
Warranty
Product Lines
Packaging
Branding
Place
Objectives
Channel Type
Market Exposure
Kinds of Middleman
Kinds and
Locations of Stores
How to Handle
Transporting and
Storing
Service Levels
Recruiting Middlemen
Managing Channels
Promotion
Objectives
Blend
Salespeople
Kind
Number
Selection
Training
Motivation
Advertising
Targets
Kinds of Ads
Media Type
Copy Thrust
Who Prepares?
Sales Promotion
Publicity
Price
Objectives
Flexibility
Level over Product
Life Cycle
Geographic Terms
Discounts
Allowances
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Target Marketing
Marketing Mix
Target Market
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Mass Marketing
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The Marketing Plan Guides
Implementation and Control
Target
Market
+
Marketing
Mix
=
Marketing
Strategy
+
TimeRelated
Details
=
Marketing
Plan
+
Other
Marketing
Plans
=
A Firm’s
Marketing
Program
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© 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Creative Strategy Planning Needed
for Survival
Death-wish
marketing
Best-practices
marketing
(Below
average)
68%
(Average
Marketing
Program)
(Well below
average)
2%
Failure
(Above
average)
14%
Poor
Fair
(Well above
average)
14%
Good
2%
Exceptional
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© 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
A Marketing Success: HarleyDavidson
Course Packet
Look for
the buzz
words:
customer
competition
company
product
price
distribution
promotion
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Facts of Harley Marketing
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Customers: What are their demographics?Who are they?
38, 53K, 60% married, 30% college, 95% male
“Rubbies” seeking individuality and escape from weekday pressures;
Competition: From?
Japanese firms, British Imports, California Company and Victor Bike;
Company: the up-and-downs in history?
1903, great depression, WW2, 1950s,1960s, 1970s AMF, 1980s;
Product: What happened to the product?
Oil leaks and breakdowns
Restructuring?
Update equipment, improve production increase employee involvement, reduce cost,
fewer employees, cut in exec salaries, ties with suppliers, JIT deliveries
Current Harley?
Enhance quality, keep up with trends and customer needs, product lines of accessories
and apparel, to allow customized looks;
Price: What/why that level?
high-price, price inelasticity for exclusive image
Distribution(place):What was done?
carefully manages the number and location of dealers, help dealers design store layout
and plan inventory to meet local needs;
Promotion: What was done?
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HOG rallies, Hog Tales magazine, printed ads to promote lifestyle
Next Time
• Find a group of 5 if you have not got into any one
or u can work alone
• Read Chapter 4
• Think critically how any businesses around you
capitalize on the opportunities that are present.
See You Next Time!
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End Lecture 1a
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