BADM 320 - Exam 1 SG - Lecture notes 1-14 PDF

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The 4Ps of Marketing Explained ● Product, Price, Place, Promotion ● Product - creates value ○ Service, idea, not just a thing ○ Better service = more money to spend (Target) ● Price - capture value ○ Buy one get one free, 50% off, etc ○ Price depends on how you value the product, varies from person to person ○ Overtime historical prices do change ● Place - delivers value ○ Retail places you sell product in - cheap store it will be perceived as cheap vice versa ○ Good night sleep at a hotel - good beds, thick windows & walls ● Promotion - communicate value ○ Concert - let people know what they are getting into ○ Most common people think about - but marketing is much more than just advertising Industry Key Success Factors ● 5-6 Key Factors - Focus on 1 or 2 to push themselves through - very expensive, spend wisely ● Find your niche within the huge industry you're in to help your business 3 Questions to think about ● What do customers want? ○ Could be different customers - ex: parent buys DS but kids play ot ○ How do we reach these people, how do we make our product different in the deciding factors of consumer ● How do we compete? ○ Do we fight over endorsements, advertising, etc ○ Low cost production for clothing brands ie key ● Death bells - Is there any product attribute that would make the consumers not want your product ○ Rats in the restaurant example ● Soda example ○ Only buy what i know - branding important ○ Marketing will be a key success factor, distribution ○ Who's coming up with new flavors? SWOT Analysis Explained ● Situational analysis, snapshot of business/company ○ Strength - What the company does well and how do we make it stronger? ○ Weakness - What the company does poorly and what can we improve? ○ Opportunities - What outside opportunities could the company take advantage of

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Threats - What outside threats could a company be hurt by and what strategies should we have to fight off those threats Mcdonalds Example: Strengths ○ Happy meal - durable toys too ○ You know that big mac will be there anywhere and everywhere you go Weakness ○ Unclean bathrooms ○ Unhealthy food Opportunities ○ Take advantage of chance ○ How do i make it happen Threats ○ What bad things could happen and how do i prepare ○ What if mcdonalds cant do a toy idea

4E Framework ● Excite - excite customers with relevant offers ○ Analytics - appeal offers to target audience to get them interested ○ Go to your facebook to check out more info ● Educate - educate your clients about what you have on offer ○ Benefits they may know and may not know ● Experience - help your clients experience your products directly or indirectly ○ See what people review about product ○ Do your research ● Engage - get clients to engage ○ buy the book, order the DVD ○ Getting them to like your photo, subscribe to my channel, etc ○ Get them to think about it - maybe purchase in the future Competitive Strategies ● Differentiation strategy: What makes your product different? ○ Willing to pay more money for a product that is more special ○ Want to drive consumers to buy more of your stuff ○ Target - world example, good displays, makes grocery store experience more unique and different compared to walmart ● Cost leadership strategy ○ More affordable for consumers ○ Aldi, Walmart - examples ● Focus Strategy ○ High end women's shoe company only focus on high end shoes - focused PEST Analysis

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Immediate or task environment ○ Competition - what can we do better to beat our competition ○ Corporate partners - who do we work with Macro environmental factors - outside company control ○ Economic ○ Demographic ○ Political ○ Technological ○ International ○ Natural ○ Cultural & Social React, or be proactive - businesses need to take all of these factors into account

Types of Marketing You See ● Product marketing - how to market product ● Service marketing - how to market the service, show people the service so consumers can see what they are getting into ● Person marketing - usually a political candidate - positive opinions to influence others opinions ● Infulencer example with getting people to the mall - mall struggling ● Cause marketing - ice bucket challenge, marketing for a cause - letting them know about the cause ○ Breast cancer awareness ● Organization marketing - red cross is marketing to get people to donate money, raise money for food banks & shelters ○ Goes hand in hand with cause marketing Needs vs Wants vs Demands ● Needs ○ A person is in a state of deprivation ○ Need of a phone example - need for communicating ● Wants ○ How needs are interpreted by the people via influences in culture and personality ○ Influenced by influencers, or where you want t o go on vacation ○ Marketers want to change some wants into needs ○ I need vacation, but want to post to my instagram feed about the vacation ● Demands ○ Wants that are backed by the ability to buy ○ I have the money to do something ○ Market in a way for someone to want it, and demand it **Needs → Wants → Demands**

Marketing Myopia ● Definition - when firms focus only on the product or the firm's point of view and do not focus on the client's point of view ● Best products actually  fail ● Best product may not actually be what the consumers want - they don't focus on the benefits, values, or experience the consumer is itching for ● Example: staying in a Safari but then putting a bunch of luxury hotels in the middle of it that's not what consumers want, they want to see the animals and enjoy what the Safari has to offer because it's not an everyday thing to see ● superman / dark knight / marvel movie - It doesn't matter what the movie concept is they want a storyline relevant to the comic ● You have to put yourself in the consumer shoes and not think about what YOU think is a good idea - when it could turn into an epic fail Sustainable Competitive Advantage ● An advantage a firm has to over their competition that is not easily copied or imitated ● Something a company is doing better than their competitors - an advantage lol ● Operational excellence - better managements ● Product excellence - better products and services ● Location excellence - what the name sounds like ● Customer excellence - builds that relationship with your customers SCA = Locational Advantage ● Aruba - they in the caribbean and also not in the hurricane route ● Walgreens and CVS at big intersections - convenience ● Starbucks put themselves in all of thee high traffic areas - it is very hards to beat convenience ○ *** Think of campus *** ● Retailers locate themselves closer to customers ● Amazon is so easy to shop on, consumers will immediately go there instead of anywhere else ● Mcdonalds and starbucks always looking for locations to open up ● Starbucks “boxes” out any possible competitors - a starbucks on each side of the street so others feel insecure about success and look elsewhere to open up How to Maintain Customer Loyalty (Customer Focused SCA) ● Businesses want loyal customers because it keeps you in business - word of mouth ● Cheaper to keep returning customers than new - still want new though ● Loyal customers tend to purchase more ● Less negotiation and such with the same customers - they know how it goes ● Culvers has a clear positioning that customers identify with - family friendly, wisconsin cheesed feel, and good food ● Create a loyalty program - this will get consumers hooked

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○ Companies are paying for your benefits to thank you for your loyalty Car dealership - they know that it will be a long term relationship ○ If you go to buy a used car - they know that you are looking for the cheapest option, so they are trying to get every dime they can out of you, while winning you over because of they know the likelihood of you coming back is low

Types of Customer Relationship Groups ● Profitability and loyalty ● Butterflies - high profitability and low loyalty ○ ex: tourists ○ Advertise to all the tourists ● True friends - highly profitability and high loyalty ○ Loyal customers, they bring you a lot of value and to consumers ● Barnacles - low profitability and high loyalty ○ Loyal to ferrari - but not enough money to purchase ○ Ex: ferrari posters, stickers, etc ● Strangers - low profitability ands low loyalty ○ Adventure with the sharks - not what most consumers want, wil choose something else Ansoff Matrix ● Market penetration - selling more of your current products to your current customers ○ How do I sell more BigMacs to the same customers? ○ Loyalty programs! ○ Give customers more opportunities to buy ○ Website - sell old products you already have to new and old customers ● Product development - develop new products to sell to your current customers ○ “Fill out a survey for a free BigMac!” ○ Good relationship with current/old clients in order for them to share their information ● Market development find new customers to sell your current products ○ Typically you start growing in the same market in different area - familiar ○ Global expansion - market research is important for product development ○ You could target current customers in new situations ■ Taco bell breakfast example ● Diversification - new product for a new client ○ Reaching out to a completely unrelated market - can be scary ○ Companies are always looking for new ways to grow their business 5 Forces Analysis ● Threat of New Entrants ○ How likely is a new computer coming into the market ○ Brand identity - Are the brands already set?

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■ Ex: Coca Cola industry ○ Entry barriers ○ Government policy ○ Capital requirements ○ Economics of sale ○ Switching costs Bargaining Power of Suppliers ○ Differentiation of inputs ○ Intel has a lot of bargaining power ○ Concentration of suppliers - few suppliers vs many, many need to worry ○ Importance of volume to supplier - Walmart can do whatever ○ The differentiation of inputs ○ Threat of forward integration - is my supplier my competitor? ■ Nineteno and Sony - Playstation issue Threat of Substitutes ○ How much of a threat is it that customers will go to a substitute instead of us ○ The buyers propensity to substitute Bargaining Power of Buys ○ Lower buyer power or high? ○ Volume of purchase ○ Product differences ○ Buyer information ○ Brand identity - identify with Pepsi or Coke? Intensity of Rivalry ○ Industry growth has effect ○ Less room to grow = rivalry ○ More room to grow = less rivalry ○ Switching costs ○ Product differences

GE Matrix ● Industry attractiveness ○ Market growth rate ○ Market size ○ Profitability of the industry ○ Rivalry ○ Global outlook of industry Where do we have the best potential? ● Strength of small business unit ○ Brand equity - how strong is he brand for that SBU ○ Market share SBU has ○ The basic business strategy, has it done a good or bad job ○ Distribution channels - do you have access to them

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○ Production capacity of SBU ○ Profit margin in relation to the competitors Grow - strong in industry, keep investing Hold - save our position, medium & average industry Harvest - weak company in a strong industry - FORGET IT

Social Media Overall ● Know your audience - do something with the information collected, knowing what social media outlets your audience uses ● Stick to your strategy - dont go off topic, it will throw people off & you will lose people ● Coordinate your messaging - same message on all platforms… who are we talking to? ● Be simple and visual - like on a picture than a post ● Respond to customers!! - talk to your customers, be SOCIAL ● Favor quality over quantity - give consumers really good posts, instead of a bunch of average ones in a week ● Good content gets people to come back Traditional Media vs Social Media ● Reach a large and niche audience - both can do that ● Expense and access ○ Traditional is a lot more money - pay to make ad, billboard, time slot, etc ○ Social media - cheaper, better access because everyone has phone/social media ○ Number of people involved and training needed ○ Time to deliver for media ○ Social media has a bigger impact because its faster ○ Permanence ○ Social authority and credibility - more to traditional media CPM/CPA/CPC/ Negotiated Ad Rates on Websites ● CPM (COST PER THOUSAND) - website agrees with advertiser to place their ads ○ Pop ups and link to link to link = increased impressions which is good ○ Build awareness which is good ○ Simple for a blogger, code is easy ○ Cheaper ways to do online ads ● CPA (COST PER ACTION) - i'll pay you for everytime clicks and comes on mypage and BUYS something ○ Only paying if you bring money into me ○ Disadvantage - hard to track sometimes, isnt easy coding like CPM is ○ Amazon you will see doing this because they have the time and money that goes into this ● CPC (COST PER CLICK) - pay for every click they get ○ Only paying for ads that deliver ○ Better placement of ad = more clicks = more money

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Negotiated ads - negotiate prices, why some bloggers have random ads ○ Tiny niches help with connection between ads and websites ○ No for sure success with these ones - hit or miss ○ Simple for everyone, yourself and the blogger

Dynamic Pricing ● Do not take an Uber during rush hour because prices will be jacked up ● Hotel ● Airline tickets ● Plan in advance to get the cheapest more affordable price, instead of day of ● Surge prices BCG Matrix ● Portfolio rides - things that you do, we have to manage these ● For companies to look at all their units , who's doing well, whose dooring poor ○ Market share - big or small ○ Market growth rate - fast or slow ● Big market share, industry growing slow - red can coke - huge market player ● Big market share, industry growing fast - iPad when it first came out: completely nailed it ● Cash cows - gives you the money, putting out cash ● Star - high market and growth rate - iPad when it first came back ○ Sometimes a small time player with your star ● Question mark - dont know where it could go… it could become a star or crash down ● Dog - product has negative growth ands is a small time player - no potential ○ Does Not start out as a dog sometimes, could be question mark then dog ○ Playstation example!!!!!...