Chapter 10/11 Begins

Finished up chapter 9 and begin his combined lecture of chapters 10 & 11

**Don't forget to do the Homework Assignment 4 due Thursday**

Chapter 9 begins

Finished Chapter 8 & went over most of chapter 9

Class Lecture

Went over chapter 8

Segmenting
Targeting
Positioning

Test Today

Finish Ch 6

About the Exam (this coming Thursday)

50 questions all multiple choice 

small scantron and pencil

[ Went over tweets ]

[ Continued Ch 6 PPT ]

What factors influence our buying decisions??

Social Factors

Culture Factors

Individual Factors

Psychological Factors

1. Social Influences

Reference Groups - those around us that influence what we do (i.e. good friends)

Opinion Leaders - (experts) people we know that have knowledge about that product category (everyone comes to Kyle for the computer problems..I am the opinion leader in Lafayette..)

Family Members - things we see growing up can influence what we purchase down the road

>> Relationships among purchases and consumers in the family

I.E. For a mother's birthday card, the children are the "purchase decision makers" for the customer the parent.

2. Individual Influences

Gender

Age/Life Cycle

Personality, Self-Concept, Lifestyle

3. Psychological Influences - the way we view things

- Perception

Selective Exposure - consumer notices certain stimuli and ignores others

Selective Distortion - consumer changes or distorts information that conflicts with feeling or belief. (you're only hearing part of what I say..like the telephone game)

Selective Retention - consumer remembers only that information that supports personal beliefs (what little we remember in class) [note; repetition can be damaging in media if over-exposed]

- Motivation

Learning

Experimental - an experience changes behavior

Conceptual - Not learned through direct experience

Beliefs & Attitudes

- Change beliefs about the brand's attributes

- Change the relative importance of these beliefs

- add new beliefs

"attitudes overtime create beliefs"

[ Did and Turned in -- In Class Assignment Sept 18 ] 

Ch 6: Consumer Behavior

TEST NEXT THURSDAY - SEPT 20TH
12 questions from each chapter
Study Guide is available on D2L


Went over Tweets
- Textbook Brokers - very helpful employees

- Retail.. even if they are not connected to our store..can impact our customers and what they think of our store..We don't have much control over them, so be careful! Such as the "sketchy Camel representative"


Understanding Consumer Behavior
Consumer Behavior
how consumers make purchase decisions
how consumers use and dispose of product


Consumer Decision-Making Process
The type of purchase can change the process.. if buying a pack of gum or buying a car.. steps may vary in that way.

1. Need Recognition
"hey we've got less than a 1/2 gal of milk..we need milk"

Recognition of Unfulfilled Wants
- When a product isn't performing properly
- When the consumer is running out of a product
- When another product seems better


"Maybe my knee will stop clicking when I walk" (if I get injectable cartilage)
"Hey okay, that might be interesting" 


We look for stuff that is worth my time, so we seek external confirmation.

"Sell for a need, rather than create a desire."a


2. Information Search

-- Internal Information Search
Recall information in memory

-- External Information search
Seek information in outside
environment
 + Non-marketing controlled
 + Marketing controlled


Some people spend more time, some spend less time when making a purchase.

3. Evaluation of Alternatives and Purchase
Analyse product attributes
Use cutoff criteria - people create attributes that are important to us.. If it doesn't have this feature/limitation then I'm not going to buy it. (at least 7 seating in the minivan)
Rank attribute by importance (note emotions are not always rankable..like in house buying)

Evoked set - the group you're going to consider (minivan or suv that is my set, so trucks, cars, and crossovers are out)

4. Purchase


5. Postpurchase Behavior
Use & Disposal


Consumers can reduce cognitive dissonance by:

 Seeking information that reinforces positive ideas about the purchase

 Avoiding information that contradicts the purchase decision

 Revoking the original decision by returning the product




Marketing can minimize through:
- Effective Communication
- Follow-up (find the problem people and help them..or else they hate us more everyday)
- Guarantees
- Warranties



Continuum of Consumer Buying Decisions

Low involvement is routine: Oh a pack of gum, BAM. Purchase done.



Marketing Implications of Involvement

High-involvement purchases require: >> Extensive and informative promotion to target market

Low-involvement purchases require: >> In-store promotion, eye-catching packaging design, and good displays. Coupons, cents-off 2-for-1 offers. In Your Face


==

Turned in Homework Assignment 2

Ch 3 & 4: The Marketing Environment and Ethics

** TYPE Homework Assignment for Thursday **

A week 1/2 from today we have a first exam (Sept 20)

50 multiple choice exam, use small scantron

Tweet about good GameStop experience

(not all is covered, so only read book sections that are covered on notes)

External Marketing Environment

These six factors play a role in trying to get to our target market.

The first one is

Social Factors

1 - Attitudes

2 - Values

3 - Lifestyles

"we all have different perceptions of values"

1. Attitudes Influence:

- Product purchased

- prices paid for products (because I like mini-vans, I'd pay more for one than you would)

- effectiveness of promotion (Coke fans see Pepsi commercials.. what do I do? I pull it apart)

- How, where, and when people purchase

Target marketing may be more effective if we target attitudes rather than 'Males under 25' demographics

2. Component Lifestyles

The practice of choosing goods and services that meet one's diverse needs and interests rather than conforming to a single, traditional lifestyle.

We can market to these clusters of lifestyles if several clusters like our product, bam.

Economic Factors

- Distribution of Consumer Income

- Inflation

- Recession

Technological Factors

uMany firms use the market concept to guide research.  

uNew technology internally creates a long-term competitive advantage.

uExternal technology

uCreates more efficient operation or better products

uMay render existing products obsolete

UPC Codes..does Walmart count all those KoolAid flavors? nope. Technology such as UPC codes have changed the way we do (inventory,checkout) business.

Political and Legal Entities

- Federal Legislation

- Regulatory Agencies (ex. FCC, FTC, FDA)

- State Laws

- Local Legislations

Laws and Regulations Protect:

- New technology

- Society

- Businesses

- Consumers

(i'm not gonna ask you specific laws on the test)

the last of the six factors are

Competitive Factors

- How many competitors?

- How big are competitors?

- How interdependent is the industry?

Always changing, and no control (over competitive factors).

Think broadly about your competitors - don't limit/narrow yourself.

== ETHICAL BEHAVIOR IN BUSINESS ==

Ethics

The moral principles or values that generally govern the conduct of an individual.

Morals

The rules people develop as a result of cultural values and norms.

Most people of one culture have similar morals, but can have very different ethics.

Morals involve "good" and "bad" as well as "deviant"  behaviors.

Ethical Development Levels

Creating Ethical Guidelines

A Code of Ethics:

§Helps identify acceptable business practices

§Helps control behavior internally

§Avoids confusion in decision making

§Facilitates discussion about right and wrong

"You have to understand what's important to you"

Think about the impacts.

Pyramid of Corporate Social Responsibility

 

Arguments Against Social Responsibility

§Businesses should focus on making a profit and leave social and environmental concerns to nonprofits.

Milton Friedman argued that the free market, and not companies, should decide what is best for the world—socially responsible companies are using shareholders' money to further their own agendas.

Green Marketing

§The development and marketing of products designed to minimize negative effects on the environment or improve the environment.

–Environmentally aware customers pay more for products

–Companies must try to educate customers of environmental benefits

Did In-class Assignment

Chapter 2 con't

Ansoff's Strategic Opportunity Matrix

Think of tools that will let you lay things out better (charts, tables, illustrations)

Put your material in different formats, lay it out, make it look nice.

Apple was used as an example

Diversification takes a lot of effort..it's expensive. (new products, new market..high risk)

Market Penetration - selling the same things to the same people (low risk)

Product Development - product has changed, but the people have not

Market Development - same product new markets (Baking Soda..used for cooking..but now used for your fridge)

Portfolio Matrix

Starting to layout our products into this portfolio and see what we need to do with our product. This is a study guide for business strategy. (aka BCB Matrix, etc..)

Market Share ( <--> horizontal ) percent of sales you have in a product category 

Market Growth ( ^ vertical ) 

High Growth and High Share = Star

Low Growth and High Share = Cash Cow (the future potential is just not there)

High Growth and Low Share = Question Marks (Problem Child)

Low Growth and Low Share = Dogs

Star

5 different star products? what's bad about that?

Marketing cost, quick change..could be very expensive.. always moving promotions, appealing to the new group.

Cash Cows, "just keep it going"

making money not spending a lot

Problem with 5 cash cows? No growth, gonna hurt later on.

Problem Child (Question Marks)

"If then" kinda thing

a flow chart situation (if this, then do this, if that then do this)

Question marks can become a Star if we have a growing share

Now, if Question marks are not bringing any money in..then the growth goes down to the Dogs

Dogs

ex. Coke Black

Target Market Strategy

Segment the market based on groups with similar characteristics

Analyze the market based on attractiveness of market segments

Select one or more target markets

"I'm in the market for a new vehicle"

What market am I in? I'm actively looking.. Might purchase something

Target Market - the interested people

Marketing Mix: The Four P's

1. PRODUCT

Includes:

physical unit, package, warranty, service, brand, image, value

Products can be:

tangible goods, Ideas, services

"We want them to think [our product] is their best friend"

(Reasons he stays in Coke products)

- Surrounded by it in Atlanta (loyal to hometown), friend worked at Coke, went to Coke's Six Flags picnic, some of the ads, color: red

2. PLACE

Getting the product to the customer when the want it.

- Product availability where and when customers want them

- All activities from raw materials to finished products

- Ensure products arrive in usable condition at designated places when needed

"I think they put Waffle Houses on both sides of the interstate exits to make it easier on the drunk people."

3. PROMOTION

uRole is to bring about exchanges with target markets by

uInforming

uEducating

uPersuading

uReminding (Coke ads are mainly for reminding)

uIncludes integration of:

uPersonal selling

uAdvertising

uSales promotion

uPublic relations

Reminding ads: "Oh, I love McDonalds.." Their ads don't really Inform, Educate, or Persuade

4. PRICE

by far, the most difficult one to get right

uPrice is what a buyer must give up to obtain a product.

uThe most flexible of  the 

"4 Ps"-- quickest to change

uCompetitive weapon

uPrice  x  Units Sold = Total Revenue

== END OF CHAPTER 2 ==

Twitter talk: Guitar Center, Best Buy

Turned in Homework Assignment 1

Chapter 2

Strategic Planning for Competitive Advantage

** Homework Assignment **
Give the 4 Ps for a company, and are any of the 4ps more important? Why one is or Why aren\'t they?

(due Thursday, turn in on paper)

Homework Assignment 1

The Marketing Mix or four P’s of marketing are listed on pages 24 and 25 of the textbook. Give an example for each of these four P’s for a company you are familiar with. This company could be a store you like to shop at, or a company that makes products you like. Finally, would you say that any of those four P’s are more or less important for your organization? Why or why not?


Strategic Planning
The managerial process of creating and maintaining a fit between the organization\'s objectives and resources and evolving market opportunities.

The goal is long-term profitability and growth.

Key: Understanding what you want to achive!

This isn\'t a one-stop shop, companies should continually re-evaluate and keep this plan active.

"I get a year older every year I teach"
"If you reach every goal you set, your not working hard enough"

Strategic Marketing Management

 What is the organization’s main activity?    

How will it reach its goals?   

THE ANSWER IS A MARKETING PLAN.

 Why Write a Marketing Plan? 

Provides a basis for comparison of actual and expected performance  

Provides clearly stated activities to work toward common goals 

Serves as a reference for the success of future activities 

Provides an examination of the marketing environment 

Allows entry into the marketplace with awareness

Marketing Plan Elements
### Insert Chart ###

Defining the Business Mission

Business Mission Statements - what you wanna do, needs to be pretty broad..

Answers the question,  “What business are we in?” 

Focuses on the market(s)  rather than the good or service (think benefits not products) 

Strategic Business Units (SBUs) may also have a mission statement

Strategic Business Units (SBUs) Characteristics: [An SBU HAS…] 

A distinct mission and specific target market 

Control over its resources 
Its own competitors

Plans independent of other SBUs
(Ex. Procgtor and Gamble P)

Marketing Objectives should be...
 Measureable
Time Specific
Consistent with and indicating the priorities of the organization

"Our objective is to achieve 10% dollar market share in the cat food market within 12 months of product introduction"

SWOT Analysis
S - things the company does well (Strengths)
W- things the company does not do well (weaknesses)
O - Conditions in the external environment that favor strengths. (Opportunities)
T - Conditions in the external environment that do not relate to existing strengths or favor areas of current weakness. (Threats)

Gaining a competitive advantage
Cost
Product/Service Differentiation
Niche Strategies

MKTG Chapter 1

"An Overview of Marketing"

He STRONGLY encourages us to get the book.

Started with our in-class assignment.
What word do you associate with marketing or it's role in business?
"Persuasion" ...his word is Communication

A lot of people see marketing as a negative thing.

"Going to McDonalds..I can tell ya that the 1/4 pounder is about $4.40 something"

===

What is Marketing?
Focus on the Customer

It's a..
Process
A business Orientation

A set of Activities or Tools... (aka the 4 P's)
Products
Distribution / Place
Promotion
Pricing

P- Got an "okay" product,
P- sold at walmart,
P -not promoted
P - and at a bad price?
No Good..not going to sell..
You gotta have the right "Marketing Mix"
Need all four to work together.

Price is hard "What a deal" "I'm not paying that much for that" (dealing with same product..)

What is Marketing?
(American marketing association definition)

Marketing is the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large.

What's an exchange?
Conditions for Exchange:
- At least 2 parties
- They have something of value
- Ability to communicate
- freedom to accept/reject offer
- desire to deal with other party
(marketing occurs even if exchange does not take place)

Value = Benefits - Costs

Customer Value - The relationship between benefits and the costs necessary to obtain those benefits.


Marketing Philosophies

Orientations:
- Production, focuses on internal capabilities of the firm - "If we build it, they will come"
- Sales, aggressive sales techniques - "I can sell ice cream to an Eskimo"
- Market, satisfying customer needs and wants while meeting objectives - "What can I do for you?
- Societal, Satisfying needs and wants while improving societal well-being - "What can we do to make the world a better place?"

The Marketing Concept
- Focusing on customer wants and needs to distinguish products and competitors' offerings
- Integrating all the organization's activities to satisfy these wants
- Achieving the organization's long-term goals by satisfying customer wants and needs legally and responsibly

"If I had asked my customers what they wanted," Henry Ford once remarked, "they would have said a faster horse."  

Comparing Sales vs. Market Orientations

Defining a Firm's Business
Think "benefits" instead of "goods/services"
Car companies...sell cars? or provide transportation.

- Ensures a customer focus
- Encourages innovation and creativity
- Stimulates an awareness of changes in customer preferences.


Build Relationships
Relationship Marketing

- Customer-oriented personnel
- Employee training programs
- Empowered employees
- Teamwork

B2B companies have to build relationships.


Why study marketing?
- Plays an important role in society
- Vital to business survival, profits and growth
- Offers career opportunities
- Affects your life every day.

"some of you are sitting at a laptop with a cute little image of a fruit on it..That's marketing"


**Skim Chapter 1**

r

Syllabus Day

Just went over syllabus.

MKT Project:
Design your own company
Write a marketing plan (how to open & run it)
"What makes you different"


Extra points?  Tweet me @ Best Buy. Psyched about my new TV.
@doctorrandymkt <-- ??

**Get Book**  MKTG 6.0 by Lamb (6 ed.)

MKT Class
- PLZ read prior to class
- rec classes (listen to each evening, whilst doing ads??)
- Notes to quiz questions