MARK 3000/3001: Week Two
MARK 3000/3001: Week Two MARK 3000
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This 7 page Class Notes was uploaded by Ariana Cammllarie on Saturday January 23, 2016. The Class Notes belongs to MARK 3000 at University of Georgia taught by Kristy McManus in Spring 2016. Since its upload, it has received 133 views. For similar materials see Principles of Marketing in Business at University of Georgia.
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Date Created: 01/23/16
Principles of Marketing MARK 3000/3001 Jan 19 – Marketing Strategic Planning What is Market Strategy? - The target ma rket, the related marketing mix (4Ps), sustainable competitive advantage (long term) and marketing plan How to hold a sustainable competitive advantage? 1. Customer Excellence (loyalty + customer service) a. View customers with a lifetime value perspective rather than on a transaction to transaction basis b. Implement membership cards to track what your TM purchases and when they purchase it c. Customer service relies on the inconsistency of humans 2. Operational Excellence (efficiency) a. Develop sophisticated distribution, information systems and strong vendor relations b. By having strong vendor relations, you can sell merchandise in unique regions, obtain special terms of purchase not available to competitors and receive popular merchandise that is in short supply 3. Product Excellence (strong brand + clear position in the marketplace) a. Develop “good” products and services that are better in some aspect to all of your competitors 4. Locational Excellence (placement of store + product) a. High density of stores in one area makes it hard for competitors to enter into the market Firms need excellence in more than one area to maintain a competitive advantage for a long per iod of time = Customer value ! Marketing Planning: A marketing plan document provides a reference point for the firm and its stakeholders to evaluate whether the firm has met its objective or not. Step 1: Business mission & Planning objectives Phase Step 2: Situation analysis SWOT Step 3: Identify opportunities Segmentation Targeting Positioning Implementation Marketing Phase strategy Step 4: Implement marketing mix Product Price Place Promotion Step 5:Use marketing Control Phase metrics to make decisions Step 1 . Figure out a mission s tatem ent that includes all business objectives - Should reflect the corporation as a whole - “Who are we and who do we want to be?” Step 2 . Use SWOT and assess CDSTEP changes that could affect the marketplace - SWOT : Strengths + Weaknesses (Internal); Opportunities + Threats (External) - CDSTEP : Cultural, Demographics, Social, Technological, Economic, Political - Use these tools to determine your corporation’s competitive advantage Step 3 . Make a STP (Segmentation, Targeting, Positioning) - Separate markets and choose a specific market you want to focus on then position your products to cater to said market Step 4 . Implement the 4Ps and allocate resources to add to the “customer value” Step 5. Use metrics to determine if a firm achieved its objectives - Look at portfolio analysis or financial performance metrics - Financial performance metrics : assess sales / profits overall or over length of time - Portfolio analysis : method to classify current business units + products and determine how to allocate resources - Portfolio analysis indicates whether to grow or consolidate o Ways to consolidate: Harvest (cut back on resources devoted to product/market) or Divestment (eliminate entire product lines) *A marketing plan does not have to follow step -by-step consecutively Boston Consulting G roup Growth Matrix (BCGGM) Stars: High growth market, high market shares (invest + grow) Cash Cows: Low growth market, high market shares (maintain + milk) Question Marks: High growth market, low market shares (watch + hold ) Dogs: Low growth market, low market shares (harvest or consolidate) Growth Strategies: 1. Market penetration : focus on same product, same TM 2. Market Development : focus on same product, new TM 3. Product Development : focus on new product, same TM 4. Diversification : focus on new product, untapped TM PRODUCTS AND SERVICES Current New n Market Product Penetration Development K M e N Market Diversification Development Jan 21 – The Marketing Environment The Marketing Environment : uncontrollable elements outside of any organization that may affect its performance The Cool Hunter + Trend Hunters are two leading companies that help firms keep up on all latest trends / styles about consumers and the environment (society). The Marketing Environment has many different aspects labeled into 2 categories 1. Immediate Environment à Internal Factors 2. Macroenvironment à External Factors The Consumer is at the very center of these two categories. The Immediate Environment: Firm’s have some control over these elements - Company (Your SWOT analysis) - Corporate Partners (Depends on your ability to be Efficient) - Competitors (Rival’s SWOT analysis) Macroenvironment: Firms have no control over these elements - Culture / Social (values + beliefs) o Influence who what when where and why a consumer buys things o Country Culture VS Regional Culture § Country = universal TM appeal within countries; EX: Mini Cooper cars are universally appealing to young adults § Regional = identifying what appeals to a TM in each location; EX: Pepsi is popular in the Midwest, Coke is popular in the South o Pay attention to social trends within a TM § Are they concerned about health/wellness? The environment? Their privacy? About saving time or money? - Demographics (population statistics) o Who people are § Age, Gender, Ethnicity § Income, Education o Generational C ohorts : a group of people of the same generation that generally share experiences + purchase behaviors o There are four generational cohorts: § Generation Z : (2001-201X) • Digital natives; access information easily; cynical view towards ads; socially connected § Generation Y + Millennials : (2000-1977) • Largest cohort; children of the “Baby Boomers;” emphasis on balancing work + play; multitaskers + good time managers; identify with ads § Generation X : (1976-1965) • Value time and education; focus on bettering their own children since most of their parents divorced; biggest spenders at mass merchandisers; finicky buyers § Baby Boomers (1964-1946) • Largest 50+ older consumer pool; individualistic + independent; enjoys time with family; control 80% of personal wealth o Ethnicity : § Currently minorities represent 37% of US population; by 2050 minorities are estimated to be 50% of the population § Minorities assimilate but hold strong ties to preserving their native heritage o Education : § Higher education = high income level jobs à more spending money o Income : § Income distribution in the US has grown more polarized with the rich getting richer + poor getting poorer § Family incomes are stagnant while cost of living is rising - Technological (innovation) o Technological advances have impacted every aspect of marketing by introducing new products, new forms of communication and new retail channels - Economic (income + business) o Marketers must monitor the entire economic situation in their home country and abroad since the economy affects the way consumers buy products o Three factors influence the economy, therefore, the firm’s ability to market a good or service depends on: § Inflation : persistent increase in the prices of goods and services; increasing prices lowers the value of currency § Foreign Currency Fluctuations : changes in the value of a s country’s currency relative to the currency of another country; influences consumer spending § Interest Rates : the cost of borrowing money; high interest rates can keep consumers in debt o Business cycles affect marketing plans: § Recession (falling income, employment and production) • Focus on value § Recover y (rising income, employment and production) • Focus on buying now for rewards later on § Prosperity (high income, employment and production) • Focus on convenience and rewards § Depression (low income, employment and production) • Focus on basic needs § Look at GDP, Country by Country Recovery + Employment Data to determine where your firm is on the business cycle - Political / Legal (laws) o Laws and regulations are in place to protect competition and consumers o Important laws include: § Sherman Antitrust Act (1890): prohibited monopolies or anything that inhibits fair trade in a free market § Clayton Act (1914): prohibited the combustion of two or more competing corporations though pooling ownership of stock and restricting pricing policies § Federal Trade Commission (1914): established to regulate unfair competitive practices that deceive consumers § Robinson -Patman Act (1936): outlawed price discrimination towards wholesalers, retailers or other producers and requires seller to maker ancillary services available to all buyers on equal terms § Wheeler -Lea Act (1938): added onto the FTC by stating it was unlawful to partake in unfair or deceitful practices for both consumers and competition § North America n Free Trade Act or NAFTA (1993): established a free trade zone in North America, lifting tariffs on the majority of goods produced by other nations (Canada and Mexico) - Competitive (what other firms are doing)
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