MAR3023, Exam 1 Notes
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This 5 page Study Guide was uploaded by Claudia Caspary on Saturday January 23, 2016. The Study Guide belongs to MAR3023 at a university taught by Luke Hopkins in Spring 2016. Since its upload, it has received 57 views.
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Date Created: 01/23/16
MAR 3023 Study Guide Exam 1 Chapter 1 What is marketing? Marketer’s view: “The aim of marketing is to know and understand customers so well the product or service fits them and sells itself.” –Peter Drucker Teacher’s view: Marketing is the answer to the question of why you buy a product. What makes a Starbucks a good product? Benefits: Taste, caffeine, great service, convenient locations, quality, consistent, variety. Although the price is expensive, people are less cost sensitive when it comes to coffee drinks, the right price is not always the low price. It maximizes profit for the firm, so it’s a good product. Product Development is a core marketing function. Firms don’t get very far without a good product to sell This warrants repeating: there would be no firms without marketing Good Products The first goal of marketing is to identify unmet customers needs and then develop a product that fills those needs. You can’t simply make a good product and be done; there are other levers to consider in the marketing aspect. Identifying the price that maximizes revenue is also part of marketing Coke: Location also a lot to do with marketing because you wouldn’t drive to Atlanta to get a coke. That’s why they make the price cheap and a convenient location for everyone. With Jimmy Johns, they might know their product isn’t the best but the location and fast delivery helps the company overall. Great Marketers 1. Develop products that people want or need 2. Price them at a level that maximizes profits 3. Distribute them to where consumers are Some “GAME CHANGER” products have the answer to the question of what consumers need/want iPhone, iPod, etc it has everything on one simply phone, solved all wants and needs Redbox replaced Blockbuster not product but distribution and pricing If marketers hit their mark with the product, price, and distribution, there’s little need to advertise No advertisements for Siracha, Lulu Lemon, Krispy Kreme because they get the product component so right Marketing is the foundation of every business. What is the visible side of marketing? Why is it so needed and so prominent? 1. TIME/REALITY Starbucks vs. McDonaldswhy pay $3 for a coffee in a low price place People are less costsensitive when it comes to coffee drinks Over time, the market reacts with competitor products that have similar benefits Over time the market becomes crowded because companies imitate success SO than the dominant firm has to convince customers why their product is superior Going from telling people about the product to WHY they should buy it 2. Advertising and Branding are VERY powerful Difference between generic brands Bayer vs. Aspirin: Nothing is different because it’s a formula You believe in the brand you’re familiar with Decorated mass produced beer? Bud Light but no it’s Ole Milwaukee Lite Not in top 20. Its not because product isn’t any good, its because you don’t believe the product is any good. And you don’t believe tat because their branding and advertising isn’t as good as dominant company 3. Advertising and Branding: It works…really well Driving on interstate and there’s Waldo’s Burgers and McDonalds, which do you choose McDonalds even if you don’t like it because it’s familiar to you Chapter 2 Over time, competitors imitate great ideas (coke zero) This creates a need to convince and remind customers that our product is different, better, and more socially acceptable than other, similar products Consumer reports rates all of the products you saw as objectively the same asor better thanthe branded products Brands and Marketing are POWERFUL History of Marketing Simple Trade Era (Pre1860s) Products were made by hand, grown or traded in small quantities Production Era (Pre1920s) ”As long as it’s black” Inward focus Technical development Sales Era (1920s) ”Changing their minds” People used to come to your door and try to sell you a vacuum FOCUS: shortterm profit maximization, selling what we make, aggressive promotion Marketing Era (1940s1990s) The “great awakening” where customers became the central focus of the organization Began with development of marketing departments then transferred to the rest of the firm Focus: Make what we sell, customer is key Clues to Market Orientation: Customer Centric Marketing collaborative relationships based on customers individual needs/concerns Relationship Marketing longterm, mutually satisfying, buyer seller relationships Customer Relationship Management using info about customers to develop and sustain relationships Green Marketing meaningful longterm relationships while maintaining an supporting environment Relationship Marketing Era (1990s2010) The focus is on longterm relationships and customer retention Engaged customers generate 1.7 times more revenue than normal customers Repeat customers generate twice as much revenue Societal Marketing Era (1960spresent) ”Green Marketing” Focus: adding society’s best interest to mix, corporate social responsibility, firm now serves 3 entities The Four P’s/Marketing Mix Product Goods, services, ideas Place make products available in quantities desired, minimize costs (inventory, transportation), retail (airports retail market 5 billion) Promotion inform individuals or groups about the organization and its products/services (Guerilla marketing, advertising, public relations etc.) PriceDecisions and actions associated with establishing pricing objectives and policies, determining product prices, determine value of the exchange Popular MacroMarketing Strategies Value completely subjective to the individual Weighing all the benefits versus all the costs Creating Value: Increasing Benefits Small Banks Some serve starbucks coffee Offer babysitter while applying for a loan Sheraton Five Points in LA offers 24hour checkin where room is always available and guaranteed Valuedifference between what you have to pay vs. what you’re getting in return What does Disney sell? Memories, they sell life experiences, relationships How do you do that with a brand like Charmin? They put a kiosk of bathrooms in the middle of Times Square, NY, concerts, sporting events. Relationship Marketing Establishing long term mutually satisfying, buyer seller relationships EX. Going to Disney Relationships in Action ChickfilA trains its employees to “go the extra mile” Segmentation Customers Cokeappeals to a specific type of customer “We can create a product that is much like our core product but taps into a different segment of the population” Market Opportunity where circumstances and timing meet to create strategic windows recognizes great opportunity Starbucks offers a second place, a comfortable environment Core competencies things a firm does well McDonald's core competency affordable, familiar with it, consistency (this helps create strategic plan) Through the process of strategic planning, a firm establishes an organizational mission and goals, corporate strategy, marketing objectives, marketing strategy, and finally, a marketing plan. Chapter 3 People you should know **Warren Buffetthird wealthiest in the world $66 billion, very humble, “It can take 20 years to build a reputation and 5 minutes to ruin it.” Firms you should know: Berkshire HathawayInsurance Company, started out as textile (owns Geico) Pepsi created by Caleb Bradham to be sold in his drug store in New Bern, NC, was a medication at first “pepsin”, owns Mountain Dew, Amp, SoBe, Quaker, Tropicana, Frito Lay, they diversify Internal Environmentimpact the firm within its own walls Market Opportunitieswhere circumstance and timing meet to create strategic windows eBaybefore it existed, how did people buy? Ads, garage sale Recession and WalMart less about experience and more about cost savings, stock went up Core CompetencyThings a firm does well Competitive Advantage opportunity + competency SWOT AnalysisStrengths, Weaknesses, Opportunities and Threats Strategic Business Units (SBUs) a division or unity within a larger parent company FSU has 15 SBUs basically separate colleges (arts and sciences, business, criminology etc.) Market Share the percentage of a market that actually buys a specific product Marketing Strategy chartbold mission statement, corporate strategies Chick Fil A Employees happy to be there, so it makes service better, great internal marketing, efficient operations Southwest Number 1 overall for internal marketing, they like their job, treat employees well KEY to Internal Marketing: Empowerment giving employees the power to act immediately, decisively, and without fear in order to attain satisfaction and delight. EX. Ritz Carlton gives employees a $ limit to make something right if a customer is unhappy. External Environmentwhat happens outside walls that impact marketing force Six forces Economic, Technological, Political, Sociocultural, Competitive, Legal/Regulatory Types of Competitors Brand, product, generic, total budget Monopolywhen an organization has no competitors so that it is the sole source of supply (rare) Oligopolywhen a few sellers control supply because of barriers to entry aka very expensive to get involved in (airlines, auto industry) Monopolistic when firms in competitive industries attempt to differentiate a product (most common) Pure Competition farmers market, cheap, everyone sells own products (rare) ECONOMIC:: Business cycleprosperity, recession, depression and recovery TECHNOLOGICAL:: In music industry and how much it has evolved, changes the way products are sold POLITICAL:: Politics influence business a lot, companies invest in certain political views, Federal Trade Commission (FTC) –most heavily influences marketing activities, large portion of its resources spent on curbing, false advertising aka Duncan Hines vs. Betty Crocker (misleading pricing) SOCIOCULTURAL:: Demographic (factors that describe a population) & Diversity Characteristics>Sociocultural Forces> Consumerism and Cultural values (examples: informality, equality, work etc.) Consumerismmarketing critics think consumers are being exploited in the marketplace Ex: Jet Blue airline they left passengers on plane, people went crazy, toilets overflowed, were given alcohol to keep them preoccupied Ralph Nader “Father of consumerism,” a well known consumer advocate Chapter 4 TOPIC 1: Corporate Social Responsibility Tidechildren were eating the pods because they thought they looked like candy What should Tide do? Maybe change the way they look Social Responsibility Maximize positive impact, minimize negative impact Can generate positive publicity and promotes goodwill, attracts customers, increased financial performance Socially responsible firms strive for marketing citizenship Marketing citizenship is accomplished when a firm fulfills the economic, legal, ethical, and philanthropic social responsibility expected by stakeholders Dimensions of Social Responsibility Economic Responsibility Legal Responsibilitymarketers expected to follow all laws and regulations for fair competition Marketing Ethics principles and standards defining acceptable conduct in marketing as determined by various stakeholders Philanthropic Responsibilities Causerelated marketing: practice of linking products to a particular social cause on an ongoing or short term basis Strategic Philanthropy synergistic use of organizational core competencies and resources to address key stakeholder’s interests and achieve both organization al social benefits MAIN DIFFERENCE cause related is a shortterm project Social Responsibility Issues Sustainability consumers insist not only on good quality of life but a healthy environment (water and land pollution) Consumerism protecting the consumer’s rights (right of safety or to be informed) Community relationseager to have marketers contributes to its well being (equality issues, safety and health) Elon Muskfounder of Tesla (Sustainability) TOPIC 2: Marketing Ethics what is acceptable conduct in marketing Has a lot to do with WHO is defining it: stakeholders, ethical climate, consumers and the public Violations in accepted marketing ethics can negatively influence the exchange process by: Violating trust, increasing customer dissatisfaction, lawsuits Uber was caught tracking users somewhere other than their homes (violated trust) Facebook manipulating news feeds to adjust mood from comment Ethical Issues Identifiable problem, situation that will require a choice as to whether or not its right or wrong, ethical or not Product Ethical Issues Marketers fail to disclose risks associated with a product Fail to disclose info regarding the function, value or use of a product Marketers fail to inform customers about existing conditions or changes in product quality Promotion Ethical Issues False or misleading advertising Manipulative sales promotions, tactics and publicity BriberyIllicit advantage Green washingproducts are promoted as being more environmentally friendly than they really are Huggies organic cotton only included in the outer cover Pricing Ethical Issues Price fixing, predatory pricing, failure to disclose the full price of a purchase Place Ethical Issues Most pirated productliquor, manipulating products availability for purposes of exploitation
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