Transcript MKT304 - Brand Luxury Index

Review Of Chapter 1 to 6
Course Overview
QUIZ 1
Franck VIGNERON
What is Marketing?
Delivery of long term customer
satisfaction at a profit.
1-1
Marketing Management
Philosophies
Production Concept
• Consumers favor products that are
available and highly affordable
•Improve production and distribution
Product Concept
•Consumers favor products that offer
the most quality, performance, and
innovative features
Selling Concept
•Consumers will buy products only if
the company promotes/ sells these
products
Marketing Concept
Societal Marketing Concept
•Focuses on needs/ wants of target
markets & delivering satisfaction
better than competitors
•Focuses on needs/ wants of target
markets & delivering superior value
which improves customers and
society’s well-being
What Motivates a Consumer
to Take Action?
• Needs - states of felt deprivation including
physical needs for food, social needs for
belonging and individual needs for selfexpression. i.e. I am thirsty.
• Wants - form that a human need takes as
shaped by culture and individual personality.
i.e. I want a Coca-Cola.
• Demands - human wants backed by buying
power. i.e. I have money to buy a Coca-Cola.
Other Applications of Marketing
• Person Marketing: Mkg efforts for getting attention,
interest, and preference of a target toward a person, e.g.,
Celebrities (Shaquille O’Neal) or political candidate
(Bush).
• Place Marketing: Visitors, improve image, real estate, …
• Cause Marketing: “friends don’t let friends drive drunk”
• Event Marketing: Sporting, cultural or charitable activities;
Salt Lake City 2002 Winter Olympics
• Organization Marketing: Navy = “let the journey begin”
How Do Consumers Choose
Choose Among Many Products
and Services?
• Customer Value - difference between the value
the customer gains from owning and using a
product and the cost of obtaining the product.
• Customer Satisfaction - depends on the
product’s perceived performance in delivering
value relative to a buyer’s expectations.
• Both are closely linked to Quality and Total
Quality Management (TQM).
How do Consumers Obtain
Products and Services?
• Transactions - trade of values between parties: one party
gives X to another party and gets Y in return (acquisition + return)
• Exchanges - act of obtaining a desired object from
someone by offering something, such as money, another
good, or a service, in return (value agreed upon)
• Relationship Marketing - building long-term relationships
with valued consumers, distributors, dealers, and suppliers
(long-term)
Marketing Management Defined
• Marketing management is defined as the analysis,
planning, implementation, and control of programs
designed to create, build, and maintain beneficial
exchanges with target buyers for the purpose of
achieving organizational objectives.
• Marketing management is concerned not only with finding
and increasing demand, but also with changing or even
reducing it. E.g., Demarketing
1-13
THE PLANNING PROCESS
MKG PLAN
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I. EXECUTIVE SUMMARY
– A stimulating summary of the marketing plan
II. CURRENT MKG SITUATION
– Internal Analysis: Strengths & Weaknesses
– External Analysis: Opportunities & Threats
III. ISSUE ANALYSIS
– Evaluate Potential Strategic Alternatives
– Recommend Alternative(s)
IV. MARKETING OBJECTIVES
– The goals to be achieved through the marketing plan in such
areas as customer satisfaction, sales volume or market share
V. MARKETING STRATEGIES
– Overall Strategies & STP - used to achieve the objectives
VI. ACTION PROGRAMS
– 4P’s - that will be used to achieve the objectives
– Programs that pinpoint who is responsible for the marketing
activities and that establish budgets and timetables for
executing the MKG strategies
VII. CONTROLS
– Procedures for monitoring the plan over time and for taking
corrective action if needed

Strategic Planning Process
Defining
the
company
mission
Setting
company
objectives
and goals
Designing
the
business
portfolio
Planning,
marketing,
and other
functional
strategies
– Defining the Company Mission: Statement of an
organization’s purpose - what it wants to accomplish in
the larger environment.
– Setting Company Objectives and Goals: Supporting
objectives for each level of management.
– Designing the Business Portfolio: Collection of
businesses and products that make up the company.
– Planning Functional Strategies: Detailed planning for
each department designed to accomplish strategic
objectives.
Situation Analysis
S
Things the company does well.
W
Things the company does not do well.
O
Conditions in the external environment
that favor strengths.
T
Conditions in the external environment
that do not relate to existing strengths
or favor areas of current weakness.
Analyzing Current SBU’s:
Boston Consulting Group Approach
Relative Market Share
High
Low
Market Growth Rate
High
Stars
Low
Question Marks
• High growth & share
• Profit potential
• May need heavy
investment to grow
• High growth, low share
• Build into Stars/ phase out
• Require cash to hold
market share
Cash Cows
Dogs
• Low growth, high share • Low growth & share
• Established, successful • Low profit potential
SBU’s
•Produce cash
?
PORTFOLIO MATRIX (continued)
Allocating future resources for each
• Build
– Invest in a problem
child that has the
potential to become a
star
• Harvest
?
– Increase short-term
cash flow from any
source except stars
• Divest
• Hold
– Hold and protect; use
Cow
cash flow to maintain
market share
– Sell off or close dogs
and sometimes
problem children that
cannot be converted to
Dog
stars
Marketing Strategies
Four Basic Types of Strategic Opportunities
PRODUCT
Present
New
M
A
R
K
E
T
P
r
e
s
e
n
t
N
e
w
Market
Penetration
Product
Development
Market
Development
Diversification
Management Decision Hierarchy
Decision Markers
Decisions
Top Managers
Goals & Objectives
Division Managers
Strategies
Field Managers
Tactics
Outcomes
Output
Managing marketing
Strategies Lead to Tactics
• Strategy:
– Direct our promotion to males, ages 25 to
40 years old.
• Tactical alternatives:
– Advertise in magazines read by this group
of people
– Advertise on television programs watched
by this group
Four Ps of Marketing
Marketing
Mix
Products
Price
Place
Target
Market
Promotion
Marketing Environment
• Marketing Environment- consists of the actors
and forces outside marketing that affect
marketing management’s ability to develop and
maintain successful relationships with its target
customers.
• Includes:
– Microenvironment - forces close to the
company that affect its ability to serve its
customers.
– Macroenvironment - larger societal forces
that affect the whole microenvironment.
Marketing Environment
Macroenvironment
Microenvironment
Company
The Marketing Environment
Demographic
Company
Economic
Cultural
Publics
Suppliers
Company
Customers
Competitors
Natural
Political
Intermediaries
Technological
What is a Marketing
Information System (MIS)?
• Consists of people, equipment, and procedures to
gather, sort, analyze, evaluate and distribute
needed, timely, and accurate information to
marketing decision makers.
• Functions:
– Assess Information Needs.
– Develop Needed Information.
– Distribute Information.
The Marketing Information System
Marketing Managers
Marketing Information System
Distributing
Information
Assessing Information
Needs
Marketing Decisions and
Communications
Developing Information
Information
Analysis
Internal
Databases
Marketing
Research
Marketing
Intelligence
Marketing Environment
Definition of Marketing Research
The systematic and objective identification,
collection, analysis and reporting of
information for the purpose of assisting
management in decisions relating to the
identification and solution of problems and
opportunities in marketing.
Types of Data & Where It Comes From
Internal data (inside the firm)
Secondary data
Facts and Figures
• Already recorded
prior to the project
Data
• Facts and figures
pertinent to the
problem
• Financial statements, research
reports files, customer letters,
sales call reports, and
customer lists
External data (outside the firm)
• U.S. Census reports, trade
association studies, and
magazines, business periodicals,
and commercial reports
Observational data
(watching people)
Primary data
Facts and Figures
• Newly collected for
the project
• Mechanical and electronic
approaches
• Personal approaches
Questionnaire data
(asking people)
• Idea generation through in-depth
interviews and focus groups
• Idea evaluation through mail,
telephone, and personal surveys
Marketing Research Process
Step 1. Defining the Problem & Research Objectives
Types & Levels of Information Needed
Exploratory
Research
Descriptive
Research
Causal
Research
Gathers preliminary information
that will help define the problem
and suggest hypotheses.
•Describes such things as market
potential for a product or attitudes
and demographics of consumers
who buy the product.
•Test hypotheses about causeand-effect relationships.
–
preliminary information: identify
issues
problem definition
first stage of descriptive or
causal research
–
–
–
–
–
expand understanding of
factors
describe phenomenon
representative sample
- test cause and effect hypothesis
experimentation
Primary Research
• Qualitative:
– Individual in-depth interviews
– Focus groups
• Quantitative:
– Observation
– Survey: Mail, telephone, or in-person questionnaire
– Experiment
Designing the Questionnaire
Formatting the Question
• Decision to be made regarding the degree of freedom to be
given to the respondents in answering the questions
Alternatives
• Open ended with no classification
• Open ended where the interviewer uses precoded classifications to
record the response
• Close ended or structured format in which a question or a
supplementary card presents the responses to be considered
Question Wording
Care Has to Be Taken That
• Is the vocabulary simple, direct, and familiar to all
respondents?
• Do any words have vague or ambiguous meanings?
• Are any questions " double-barreled”?
• Are any questions leading or loaded?
• Are the instructions potentially confusing?
• Is the question applicable to all respondents?
• Are the questions of appropriate length?
Market Research Process:
types of samples
• Probability Samples
– Simple random sample
• known chance
• equal probability
– Stratified random sample
• mutually exclusive
groups
• random sample drawn
• Non-probability Samples
– Convenience sample
• select easiest
population
– Judgment sample
• select for accurate
response
• interview set number
The Marketing Research
Process
STEP1: Defining the Problem and Research Objectives
STEP 2: Developing the Research Plan
STEP 3: Implementing the Research Plan
STEP 4: Interpreting and Reporting the Findings
Five-Step Marketing Research Approach
Leading to Marketing Actions
Step 1
Define the
problem
• Set Research
Objectives
• Identify
possible
marketing
actions
Step 2
Develop the
research plan
• Specify
constraints
• Identify data
needed for
marketing
actions
• Determine
how to collect
data
Step 3
Collect
relevant
information
by
specifying
• Secondary
data
• Primary
data
Step 4
Develop
findings and
recommendations
• Analyze data
• Present
findings
• Make recommendations
Step 5
Take
marketing
actions
• Implement
recommendations
• Evaluate
results
A Classification of Marketing Research Data
Marketing
Research Data
Secondary
Data
Primary
Data
Qualitative
Data
Quantitative
Data
Descriptive
Survey Data
Experimental
Observational
& Other Data
Experimental
Data
External Influence
Input
Firm’s Marketing Efforts
1. Product
2. Promotion
3. Price
4. Channels of distribution
Need
Recognition
Process
Prepurchase
Search
Evaluation of
Alternatives
Output
Purchase
1. Trial
2. Repeat purchase
Postpurchase Evaluation
Sociocultural Environment
1. Family
2. Informal sources
3. Other noncommercial
sources
4. Social class
5. Subculture and culture
Psychological Field
1. Motivation
2. Perception
3. Learning
4. Personality
5. Attitudes
Experience
Figure 1-1
A Simple Model of
Consumer Decision
Making
Consumer Behavior Influences:
cultural factors
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•
•
•
Culture
Set of basic values, perceptions and behaviors
learned behavior by a member of society
from family and other important institutions
Consumer Behavior Influences:
Social Factors
• Groups
– membership
– reference
• Family
– most important consumer influence
– changing family roles
– children may influence strongly
Table 5-3
Young
Single
Married without
children
Married with
children
Divorced with
children
Family-Cycle Stages
Middle-Aged
Single
Married without
children
Married with children
Married without
dependent children
Divorced without
children
Divorced with children
Divorced without
dependent children
Older
Older married
Older unmarried
Sources: Adapted from Patrick E. Murphy and William A. Staples, “A Modernized
Family Life Cycle,” Journal of Consumer Research, June 1979, p. 16, copyright Journal
of Consumer Research, Inc., 1980. Also see Leon G. Schiffman and Leslie Lazar
Kanuk, Consumer behavior (Englewood Cliffs, NJ: Prentice Hall, 1994), pp.. 361-70.
Consumer Behavior Influences:
Social Factors
• Roles
– Activities people expected to perform
• Status
– Esteem given a role by society
Consumer Behavior Influences:
Personal Factors
• Lifestyle
• A person’s pattern of living
• as expressed in his of her
– Activities: work, hobbies, shopping, sports, social events
– Interests: food,fashion,family, recreation
– Opinions: about themselves, social issues, business,
products
Consumer Behavior Influences:
Personal Factors
• Occupation
– affects goods or services purchased
– identify occupations with product need
– specialized professional products
• Economic situation
– indicator for income sensitive products
Consumer Behavior Influences:
Personal Factors
• Psychographics
– Technique of measuring lifestyles
– Developing lifestyle classifications
– By measuring
• activities
• interests
• Opinions
– + Social Class and Personality Characteristics
Consumer Behavior Influences:
Personal Factors
• Personality
– traits
– may predict behavior
• Self-concept
– self-image
– possessions reflect identity
Factors Influencing
Consumer Behavior
Cultural
Social
Culture
Reference
groups
Subculture
Family
Social
class
Roles
and
status
Personal
Age and
life-cycle
Occupation
Economic
situation
Lifestyle
Personality
and
self-concept
Psychological
Motivation
Perception
Learning
Beliefs and
attitudes
Buyer
Consumer Behavior Influences:
Psychological Factors
• Motivation
– biological needs
– psychological needs
• Motive
– Need sufficiently pressing
– to drive a person to seek satisfaction
– may be unconscious
Maslow’s Hierarchy of Needs
5
Self-Actualization
(Self-fulfillment, personal enrichment)
Ego Needs
(Prestige, status, self esteem)
Social Needs
(affection, friendship, belonging)
Safety and Security Needs
(Protection, order, stability)
Physiological Needs
(Food, water, air, shelter, sex)
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3
2
1
Types of Buying Behavior
High involvement
Low involvement
Significant
differences
between brands
Complex
buying
behavior
Varietyseeking
behavior
Few differences
between brands
Dissonance
reducing
behavior
Habitual
buying
behavior
The Buyer Decision Process
Need Recognition
Information Search
Evaluation of Alternatives
Purchase Decision
Postpurchase Behavior
Adopter Groups
2.5%
Innovators
Buyer behavior
13.5%
34%
Early
Early
Adopters Majority
34%
Late
Majority
16%
Laggards
Business Buying Situations
Involved Decision Making
New Task Buying
Modified Rebuy
Straight Rebuy
Participants in the Business Buying
Process: The Buying Center
Gatekeepers
Users
Buying Center
Buyers
Deciders
Influencers
Stages of the Business
Buying Process
Problem Recognition
General Need Description
Product Specification
Supplier Search
Proposal Solicitation
Supplier Selection
Order Routine Specification
Performance Review