MKTG Notes PDF

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Notes from reading for quizzes...

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1.1 Marketing: Activity, set of institutions, and processes for creating, communicating, delivering value 1. Marketing is the exchange that takes place between sellers and buyers 2. Marketing creates, communicates, delivers value 3. Value = satisfy customer needs and want profit     

Market = individuals that have 1) Needs/wants 2) Ability/willingness/authority to purchase things to satisfy their needs/wants Business market = individuals in organizations/companies purchasing for the company or resale Consumer market = individuals purchasing product/services for personal use B2B = Business to business B2C = Business to consumer

1.2 MARKETING CREATES AND DELIVERS VALUE

1.3 THREE LEVELS OF STRATEGY  Marketing strategy = mix of product, place, price, promotion 1. Corporate strategy o What type of business to be in o Specialists perform better than generalists 2. Strategic business unit (SBU) o How to compete effectively in a given business o Portfolio model: Model that measures performance of company's strategic business units based on market growth and relative market share o Four types of SBU's i. Stars: High growth, high share (shining business, dominant, fast growth) Ex) Apple watch, vitamin water ii. Cash Cows: Dominate in slow growth, generate more cash than needed Ex) iPhone, Coke iii. Question market: High growth, low market share Which business should the company invest in or eliminate? Need money from cash cows iv. Dogs: Slow growth, low market share May generate enough money to support themselves, but may be eliminated to focus on better SBU's 3. Marketing strategy

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How to orchestrate marketing mix to deliver value to target market Functional areas of company have a strategy (Finance, HR, Marketing, Supply Chain)

1.4 MARKETING STRATEGY PROCESS PATH TO PROFITABILITY 1. Segmentation: Customers put into homogeneous segments so customers in a group are similar to each other in way they respond to marketing efforts directed toward them 2. Targeting: Company chooses segments to serve 3. Positioning: Position product offering for target customers Marketing Mix 1. Product = product or service (bundle of attributes creating value) 2. Place = Where products are purchased (distribution) 3. Price = Amount paid for a product (most difficult element of marketing mix) 4. Promotion = different marketing activities - Advertising, public relations, etc 1.5 MARKETING THROUGH EYES OF BRAND CHAMPIONS  Brand champion = Best customers  Know the reason consumers love the brand o Ex) Coca cola friendship machine - twice as tall as normal  Ride a wave = looking at existing products and coming up with a complimentary one o Ex) Jibbitz rode the Crocs wave 1.6 PRODUCT MARKET EXPANSION MATRIX Grow a business 1. Market Penetration = Selling more of existing product in existing markets (expansing stores, more retailers) a. Ex) McDonald's 2. Product development = Introducing new products to existing markets a. Ex) McD's sweet and spicy wings 2. Marketing Development = existing products to a new market (geographical location) a. Ex) McD's in China

2. Diversification = Introducing new products to new markets a. Ex) McD's selling tshirts in China 1.7 TARGET MARKET + MARKETING MIX = MARKETING STRATEGY  Marketing plan = Strategy with itemized budget and timeline  Customer acquisition to retention  Customer lifetime value (CLV) = Economic value a customer brings over a lifetime relationship with business  Must know customer worth to know how much to spend to get and retain a customer Boost sales per customer  Persuade customers to buy more  Generate add-on sales (complimentary)  Partner with other firms  Margin = difference between cost and price Increase margin  Increase price  Shift mix of purchases to higher-margin products  Discourage unprofitable customer behavior *Sell product for 5x what you bought it for 1.8 SELECTING PRODUCTS, CUSTOMERS, AND COMPETITION  Killer idea = what problem are people trying to solve? o Focus on current problems, not current products o Eye for pain and problems  Chase customers, not competition  Raise relevance bar - connect consumer to product 1.9 RELEVANCE MODEL - HOW PRODUCT IS MONETIZED Venture capitalists look for  Product in market generating hundreds of millions  Product demanding price way more than it cost  Management team with history of profit 1.10 Marketing Philosophies  Product orientation: Focused on belief that supply generates demand o Firms capabilities, no consideration to needs of market, no consideration to competitors o Ex) Ikea  Sales orientation: Marketing's only role is to sell products o Assertive/aggressive, may fail to meet needs of customers o Ex) Summer sales  Marketing orientation: Every product should focus on customer needs and want a profit o Understand needs, know capabilities, know competitors o Ex) L.L. Bean  Societal orientation: Every product should provide value to customer and society o Concern for environment, environmentally friendly products o Ex) The Body Shop...