MKTG 2400, Week 8 Notes
March 7, 2017
Consumption spreads faster today
- Relative advantage
- Product complexity
- Perceived risk
o Economic risk
o Social risk
o Physical risk
Let us talk about Branding with the Master of Branding, Muhammad Ali
∙ Muhammad won the game before he stepped into the ring…he embodied the brand of a champion
But we’re going to talk about Muhammad as a Master of Branding through ANOTHER Master of Branding who used his image to help them…Apple (Think different).
∙ By 1997, Apple has hit rock bottom and need a brand repositioning. They’re so desperate that they bring back the one man they ganged up on and threw out – Steve Jobs
Branding starts with the basics and focusing. We start this idea with focusing in the product.
∙ Trade name – a commercial, legal name of a company If you want to learn more check out What are the three types of barriers in the skin?
∙ Brand name – any word, design, logo, shape or color used to distinguish a seller’s product
∙ Trademark – a legally registered brand name or trade name ∙ Register @ www. Uspto.org
∙ Brand counterfeiting – cheaper brands stealing your product/ brand Essence of branding
∙ You hope to leverage familiarity and positive image of one into another ∙ You can license your brand to get it out to more markets but under the same name, idea, and personality
Why by branded products?
∙ Brands help us to be more efficient shoppers
o Avoid products you have been dissatisfied with If you want to learn more check out Who designed the idea that the market could improve social inequalities?
o Become loyal to more satisfying brands
∙ Ease consumer decision making
∙ Eliminate the need for external search
Marketing Insights – Brands under proper names
∙ Thousands of brand names and trade names are registered annually ∙ Uspto.gov > trademarks > trademark search
∙ Starting a business using your own name? Better check first Brands Evolve and have by-products
∙ Brand personality vs. Brand equity
Brand Personality (like an aura around the brand)
∙ Brands and their personalities should complement our own personality/ what we know of ourselves
Valuing Brand Equity
∙ brand equity provides a financial advantage for the brand owner ∙ Brand licensing (makes this a possibility)
How do you create brand equity? (pyramid)
Consumer Judgements + Consumer feelings We also discuss several other topics like What is the purpose of nuclear pores?
Brand performance + Brand Imagery
March 9, 2017
“Our goal is to be the next Sony on 20 to 30 years.”
Price is what you pay. Value is what you get.
Building Price Foundation: Chapter 13
Price makes or breaks the deal if the price isn’t right, the product won’t be successful
1. What are we trying to achieve?
2. How much will consumers pay?
3. How much does it cost us to make the exchange?
Question 1: Identifying Pricing Objectives and Constraints
∙ Objectives include: If you want to learn more check out How does latitude affect insolation?
o Profit (sales revenue)
o Unit Volume
o Survival (market share)
o Social (responsibility) If you want to learn more check out What are the written promises to pay a sum of money on a specified future date called?
o Demand - # of people who want our product dictates how much
product we can/should make
Usually demand has nothing to do with us (marketers) but we
must still understand their trends
o Newness – stage in the product lifecycle
o Single Product vs. Product Line
o Cost of Marketing (merchandising costs)
Creating Demand Curves
Example demand Curve
Notice as price increases the number of products sold/quantity decreases We also discuss several other topics like What is the difference between vowels and consonants?
NOW, what would happen if you kept the same pricing structure but added value to the product or increased promotion? This shifts the demand
How to shift a demand curve:
∙ Consumer tastes
∙ Price and availability of similar products
∙ Consumer income
Price Elasticity of Demand
Formula: Elasticity = (% change in Demand) / (% change in Price) Elastic Demand = % change in quantity is greater than % change in price Inelastic Demand = % quantity is less than % change in price
Unitary Demand = % change in quantity is the same as the % change in price What is the demand curve for my product?
- Look at past sales performance
- Total Cost
o Fixed Cost – fixed no matter how much product is produced (ex. – rent, salary, etc.)
o Variable – varies with quantity sold
Marginal revenue > /=/ < Marginal Cost
- Marginal revenue > Marginal cost = you should keep selling more - MR < Marginal cost = stop selling
Break-even analysis (gives us the sweet spot of cost and revenue) - Where we stop losing money and start making a profit BEP Quantity = (Fixed Cost) / (Unit Price – Unit Variable Cost) = (FC) / (P – UVC) *When your total cost – total revenue = 0…this is the break-even point