Marketing Lecture Notes

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Western University *

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2320

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Marketing

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Feb 20, 2024

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Marketing Intro slide notes ● Long answer exams ○ Will be given 2-3 paragraph prompts ○ Do it on word and submit ○ Will go through examples in class for discussion ■ Gives you good idea of exam ■ lec 4 - consumer behavior - will prob be on midterm ○ Not cumulative Group project ● IF u have friends you wanna work w in this group project - send him an email before sept 30 ● Video is like a long pitch ○ Must keep between 10-12 ○ No expectation for how many people are speaking ■ One person can speak ○ No expectation on who is in this video ■ You don't even have to have anyone in this video ● Q&A - prof will assign group another groups video and you have to ask a question ○ Ask yourself are you persuaded, why aren't you persuaded ○ Don't ask why the product doesn't come in blue ● Only need to send one copy ○ Recommends not to wait til last min to upload video - may take long ○ Recommends different people submitting stuff (one person for docs, one person for video) ● Written ○ 14.5 and 15.5 and 16 pages r ok ● Peer eval ○ Does not affect group mark but may affect individuals mark Textbook ● Everything on textbook is fair game ● But depending on how much time we spend on a specific topic - that will most likely occur on the exam What is marketing? ● According to the CMA, “marketing is a set of business practices designed to plan for & present an organization’s products or services in ways that build effective customer relationships.” ● According to the AMA, “marketing is an organizational function & a set of processes for creating, capturing, communicating, & delivering value to customers & for managing customer relationships in ways that benefit the organization & its stakeholders.” ○ More detailed definition

○ Recognizes complexity of marketing ○ Must communicate value to customer Value ● The fundamental purpose of marketing is to create Value for the consumer and capture Value from the consumer ○ Value for the consumer: benefits and products and service consumer receives ○ Capturing value: benefits company receives from customer ○ Value can be what the product does for the consumer NOT what the actual product is Needs and wants ● Effective marketing seeks to understand and satisfy the different ways that different consumers will want to meet their needs. ● Needs: raw states of deprivations ○ Broad term ○ Things we need but isn't anything specific ● Wants have shape and is specific ● Example: ○ Hunger = need ○ Sushi = want Exchange ● At the core of any marketing activity is the voluntary trade of things of value between two parties so that each may benefit, and both might prosper. What type of business is it? ● B2B ● B2C ○ Will prob focus on this more ● CSC Will focus on ● Markets ○ Find value in a product and can acquire product ● Target markets ○ What companies try to focus their attention on ● Users/ consumer ○ People who actually uses the product ● ^Different but overlapping groups The marketing mix

● The Marketing Mix – the Four Ps of Product, Price, Place, and Promotion – are those areas of decision-making and activity necessary to deliver value as we satisfy the needs and wants of our target market(s). The aim of marketing is to make selling unnecessary - Peter Drucker How has Marketing changed over time? ● Through marketing orientation ● Production Orientation → Sales Orientation → Marketing Orientation → Value- Based Orientation Value based ● When organizations have a “ValueBased” orientation, they compete by offering the consumer greater value than their competitors can. But we need to remember, value isn’t just about large quantity or low prices. ● Not built through a single moment or single transaction but over time ○ Creating relationships ● Doing this often means better products but also a focus on increased social responsibility, societal marketing concepts, and “The Triple Bottom Line.” ○ The triple bottom line keeps a balance Triple bottom line ● People + Profits + Planet ● Why does this matter? ○ Cus consumers see if the company aligns with their values CRM ● Value-Based organizations also think in terms of creating and curating ongoing Consumer Relationships rather than unique sales transactions. ○ Consumer value and shared values sets a foundation for the company ● Investments in Customer Relationship Management (CRM) efforts should strengthen the connection between consumer and brand and increase value and satisfaction. ○ Customer Relationship Management (CRM): PC optimum points ● Value of CRM increases if there are more perks (Sephora's different tiers of membership) ● Doing so is also beneficial for the organization. Done properly it can increase understanding, share-of-wallet, and the lifetime value of a consumer Marketing strategies ● According to Michael Porter, a marketing strategy describes “how a business is going to compete, what its goals should be, and what policies will be needed to carry out these goals ● Need to be well-defined and clear

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“A well-defined marketing strategy will…” “Identify the market(s) we plan to target with our efforts.” + “Outline or inform a Marketing Mix that will appeal to those market(s).” + “Offer a basis for our Sustainable Competitive Advantage(s). What are Sustainable Competitive Advantages? Michael Porter’s Theory of Sustainable Competitive Advantage ● Cost Leadership + Differentiation + Focus (Cost/Diff.) + “Middle of the Road” ○ Cost leadership: company's ability to lower costs of production to offer quality products at low prices ○ Focus: niche things ○ Middle of the road: be effective in all areas. Be good in all areas ■ This strategy is least favoured as it doesn't usually work Treacy and Wieserma’s “Value Disciplines” for Competitive Advantages ● Operational Excellence + Product Leadership + Consumer Intimacy ○ Operational Excellence: being able to do things well ○ Product Leadership: solve problems for consumers, doing things for the consumers, increasing consumer value ○ Consumer intimacy: understanding consumers and their relationship Marketing plan ● A Marketing Plan is a kind of blueprint for how an organization will address their market situation, carry out effective marketing programs that achieve strategic objectives, and provide customers with value ● Should be written docs ● Should be formal 1. Planning Phase a. What do we want to do 2. Implementation Phase a. How are we going to do ti b. How do we achieve these objectives c. Who is our target market 3. Control Phase a. Did we do what we planned to b. Evaluating success and failure Mission & Vision ● A Mission Statement is a broad description of an organization’s overarching goals and the scope of activities it plans to undertake ○ Raw description ○ Day to day activities

○ What the company currently is ● Vision statements are broad, forward looking, and motivational statements that point to the best possible version of an organization. ○ More forward looking and future looking Objectives ● Objectives describe the specific things that an organization hopes to achieve with their Marketing Plan ● The actual plan ● Strong objectives will be S.M.A.R.T.: Specific, Measurable, Achievable, Realistic, and Time-bound. An organization’s objectives should be well defined with both qualitative and quantitative dimensions. ○ Need to set a deadline Chapter 1: Overview of Marketing Building value ● Build & maintain a loyal customer base ● Distinguish from competitors ● How do Tim Hortons & Starbucks do it? ● Strong brand, customer appeal ● Constantly need to protect the brand What is marketing? ● Marketing is a set of business practices designed to plan for and present an organization’s products or services in ways that build effective customer relationships Core aspects of marketing Satisfying customer needs and wants ● Need: basic necessities ● Want: how to fulfill that need Entails a marketing exchange ● The exchange can occur between any two parties

● Not simply a buyer and seller exchanging money for a good or service ● Can be an exchange of information for convenience Marketing entails an exchange Which of the following is NOT part of a marketing exchange? A) Sellers provide products or services. B) Sellers communicate and facilitate delivery. C) Marketers assess the effectiveness of their advertising. D) Buyers complete the exchange by giving money and information to the seller. Marketing requires marketing mix decisions ● Need to work together and fit like a puzzle Product: creating value ● Goods ● Services ● Ideas Price: transacting value ● Price is everything the buyer gives up in exchange for the product. ● Money ● Time

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● Energy Place: delivering value ● All activities necessary to get the product to the right customer when that customer wants it. ○ Distribution strategy ● Supply chain management is the field that examines these activities. ● Where would you find this product in the store? Promotion: communicating value ● The communication activities of marketing ● Used to inform, persuade and remind potential buyers ● Used to influence their opinions or elicit a response Promotion is ____________ by a marketer that informs, persuades, and reminds potential buyers about a product or service to influence their opinions or elicit a response. A) smoke-and-mirrors B) coercion C) teasing D) communication Marketing can be performed by both individuals and organizations ● B2B: Wholesaling is often only Business to Business → All retailing is Business to Consumer selling → C2C: Swap Meets, EBay, yard sales, etc Social media and marketing ● The use of digital tools to easily & quickly create & share content to foster dialogue, social relationships & personal identities Marketing impacts many stakeholders ● Both profit and non-profit entities ● Developing economies ● Entire industries The four orientations of marketing ● Product Orientation (oldest) ○ Product-oriented companies focus on developing and distributing innovative products with little concern about whether the products best satisfy customers’ needs. ● Sales Orientation ○ View marketing as a selling function where companies try to sell as many of their products as possible rather than focus on making products consumers really want

● Market Orientation ○ Market-oriented companies start out by focusing on what consumers want and need before they design, make, or attempt to sell their products and services ● Value-based Orientation (current) ○ To compete successfully, firms focus on the triple bottom line: ■ People (consumer needs & wants) ■ Profits (long-term profitable relationships) ■ Planet (social and environmental responsibility) What must firms do to become value driven? A) Share information, balance benefits and costs, and build customer relationships. B) Set low prices, put profit above service, and use effective marketing strategies. C) Make logistics a priority, expand globally, and always offer new goods and services. D) Keep a vigilant eye on the market-place, undercut competitors, and provide competitive salaries How do firms become more value driven? ● Firms focus on four activities: 1. Sharing information 2. Balance customer’s benefits & costs a. Understand key benefits. b. Focus on key benefits. c. Eliminate cost of less strategic benefits 3. Build relationships with customers a. Take a long term view of customer relationships b. Use data to assist in maintaining the relationship 4. Use technology to connect with customers a. Connect using social media b. Embrace social media to connect better with customers c. Users are driving the way brands & stores are interacting with social media Marketing expands firms global presence ● Good are available to consumers from many countries from the far reaches of the globe ● Must understand customers needs & wants ● Segment-by-segment, region-by-region Marketing is pervasive across channel members ● Each step in the supply chain involves marketing ● All members in the chain must ultimately focus on creating value for their customer and the end user consumer ● Chian ○ Raw materials suppliers → manufacturer → distribution → customer

Which of the following would NOT be considered part of a supply chain? A) consumer B) retailer C) manufacturer D) customer service representative MARKETING CAN BE ENTREPRENEURIAL ● Though important to large firms, marketing is equally important to the success of small ventures—especially new ventures Chapter 2: Developing Marketing Strategies and a Marketing Plan The Goal is Clean: WIN! ● Is innovation important? ● Creative sustainability ● Strategies and plans must be precise ● Brand disruption? What is a marketing strategy ● Marketing strategy identifies: ○ a firm’s target market (s) ○ a related marketing mix –the four P’s and ○ the bases upon which the firm plans to build a sustainable competitive advantage ● Leads to sustainable competitive advantage! Sustainable competitive advantage: Nike - Just DO it ● Strong brand ● Technology ● Strong customer base ● Loyal customers Discussion question ● Why have these factors been the keys to Nike’s sustainable advantage? Are there other factors to consider? What is sustainable competitive advantage? A) A broad description of the firms objectives and scope of its activities. B) Tool used to evaluate marketing performance. C) Something the firm can consistently do better than its competitors. D) Written document that discusses competitor strengths and weaknesses, and the firms advantages over them

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Developing customer value ● ● Macro Strategies for Developing Customer Value Customer excellence ● Retain loyal customers ● Provide excellent customer service Operational excellence ● Product excellence ● High perceived value + Effective branding and positioning Locational excellence ● The three most important things in retailing are location, location, location. ● Ex. Tims Starbucks Multiple sources of advantage ● Multiple approaches: ○ Customer value ○ Customer service ○ Customer relations ○ Great prices!

● Good service = good value Customer excellence focuses on? A) having products with high perceived value and effective branding and positioning. B) retaining loyal customers and providing excellent customer service. C) having a good physical location and Internet presence. D) efficient operations and excellent supply chain and human resource management. Developing a marketing plan ● ● STEP 1: DEFINE THE BUSINESS MISSION & OBJECTIVES ● Defining the mission ● Tim Hortons states: Our guiding mission is to deliver superior quality products and services for our customers and communities through leadership, innovation and partnerships. Our vision is to be the quality leader in everything we do ● The Heart and Stroke Foundation mission: is to improve the health of Canadians by preventing and reducing disability and death from heart disease and stroke through research, health promotion, and advocacy. STEP 2: CONDUCT A SITUATION ANALYSIS (USING SWOT)

Step 3: Identify and Evaluate Opportunities by using STP ● Segmentation → testing → positioning ● ○ Hertz market seg Which of the following refers to a group of consumers who respond similarly to a firm’s marketing efforts? A) Market segment B) Target market C) Targeting D) Positioning STEP 4: IMPLEMENT MARKETING MIX AND ALLOCATE RESOURCES

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Product and value creation ● How does Dyson deliver value based upon the products it creates? Product and value for money ● Exchange: product = money ● Customer perception of value ● Price is only a part of value! Place and value delivery ● Product must be readily accessible ● When and where the customer wants it ● Why is this retailer growing? Promotion and value communication ● Marketers communicate the value of their offering, or the value proposition, to their customers through a variety of media, including: ○ Television ○ Radio ○ Magazines ○ Sales force ○ Internet STEP 5: EVALUATE PERFORMANCE BY USING MARKETING METRICS ● Outcomes need to be evaluated. Metrics are used to explain why things happened and to project the future. In particular: ○ Who Is Accountable for Performance? ● It can be difficult to find one measure to evaluate performance. ○ Performance Objectives and Metrics ■ Financial Performance Metrics ■ Social Responsibility Performance Metrics PORTFOLIO ANALYSIS BOSTON CONSULTING GROUP MATRIX (BCG)

● One of the keys in place and value delivery is to provide the consumer _______________. A) a wide product selection B) merchandise they want at the time they want it C) a variety of media communication methods D) accessible management personnel to handle complaints Growth strategies ● Market penetration ○ Trying to get more of the market ○ Strategy may include sales or some sort of promotional activity ○ Timmies: increasing location ● Product development ○ Selling more things to our existing consumers ● Market development ○ Take current product and aim it to a new market ○ International expansion ● Diversification

○ Not keeping all eggs in one basket ○ Expansion with new products ○ Targeting new markets ○ Taking risks Which of the following is NOT considered a marketing growth strategy? A) Market penetration B) Diversification C) Product development D) Sequential planning Market penetration ● Existing marketing mix ● Existing customers Discussion question ● In what way is a sale a market penetration strategy? Market development strategy ● Existing marketing offering ● New market segments (domestic, international) not currently being served Product development ● New product/service ● Current target market Divesification ● New product/service ● New market segment not currently being served A diversification strategy introduces a new product or service to a market segment that _______________. A) is currently not served B) includes many ethnicities C) already exists D) does not traditionally respond to mixed media

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Marketing Lecture Notes

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