The document provides an overview of key concepts from chapters in Kottler and Wood related to collecting market information, forecasting demand, and analyzing a company's current situation. It discusses developing a marketing information system, types of internal and marketing data, the marketing research process, and variables that impact demand forecasting. It also outlines analyzing a company's internal factors like resources, offerings, results and relationships as well as external macroenvironmental and microenvironmental trends that influence strategic decisions.

1. BMGT 411: Week #3
Kottler:
Chapter 3 - Collecting Information and Forecasting Demand
Chapter 4 - Creating Long Term Loyal Relationships
Wood:
Chapter 2 - Analyzing the current situation
1

2. Kottler Chapter 3: Collecting Information and
Forecasting Demand
2

3. BMGT 411: Chapter 3
• Marketing Information System: Consists of people, equipment, and
procedures to gather, sort, analyze, evaluate and distribute needed, timely
information to marketing decision makers
• Internal Company Records: CRM Systems are an effective system for
marketers
• Marketing Intelligence: Competitive and Industry Analysis
• Marketing Research: Primary and Secondary
3

4. American Eagle Outfitters
Types of Internal Sales Tools
4

5. BMGT 411: Chapter 3
• Examples of Internal Sales Tools at American Eagle Outfitters
• Raw Sales Data
• Cost per Transaction or Basket Size
• Conversion
• Repeat Visits
• STS Sales
• Seasonal Sales
5

6. Marketing Research
def: Systematic design,
collection, analysis, and
reporting of data and findings
relevant to a specific marketing
situation
6

7. The Marketing
Research Process
7

8. BMGT 411: Chapter 3
• Step #1: Justify the need for marketing research. If there is no need, kill the project
here.
• How will this marketing research help you improve sales?
• How will the marketing research help solve a problem?
• How will the marketing research identify a target market?
Four Considerations
1. Potential usefulness of the results
2. Management attitudes towards marketing research
3. Resources available for implementation
4. Costs vs. benefits
8

9. BMGT 411: Chapter 3
• Step #2: Define the problem and research objectives
• Problem and objectives should be very clear
• Problem or objectives should help define what type of research is needed
Types of Research
1. Exploratory: To investigate a general problem and possible solutions
2. Descriptive: Very specific to help forecast demand or likeness
3. Causal: To test a cause and effect relationship when adding variables
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10. BMGT 411: Chapter 3
• Step #3: Identify data needs
• What type of information are you looking for
• Scrutinize the research purpose
• List the types of data that will fulfill this purpose
10

11. BMGT 411: Chapter 3
• Step #4: Identify data sources. If the data can be acquired using existing
secondary research, you may be able to skip to step #9
• Primary Data
• Data obtained directly from consumer to fulfill a specific purpose
• More expensive approach
• Secondary Data
• Data that are readily available from other sources
• Internal or external
• Often less expensive to use
11

12. BMGT 411: Chapter 3
• Step #5: Choose an appropriate research design and data collection method
Research Proposal
• Serves as a blueprint for the execution of the product
• Explains
• Purpose and scope of the project
• The specific design of the project
• Sample design
• Data collection procedures
• The data analysis plan
• The project timetable
12

13. BMGT 411: Chapter 3
• Step #5: Main Types of Marketing Research Approaches
Quantitative:
•Survey Research
•Behavioral Data
•Experimental research
Qualitative:
•Observation
•Focus Groups
13

14. BMGT 411: Chapter 3
• Step #6: Design the Research Instrument of Form
1. Questionnaires: Most common due to flexibility
2. Qualitative Measures: Unstructured and often revealing
3. Technological Devices: Often measures body’s reactions
to applied stimulation
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15. BMGT 411: Chapter 3
• Step #7: Identify the sample
1. Sampling Unit: Whom should we survey?
2. Sample Size: How many people should we survey?
3. Sampling Procedure: How should respondents be
chosen?
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16. BMGT 411: Chapter 3
• Step #8: Collect the Data
• In Person: Very expensive and time consuming
• Phone: Still popular, assisted by computers
• Mail: Dying form of collection
•Online: Popular and inexpensive (www.surveymonkey.com)
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17. BMGT 411: Chapter 3
• Step #9: Analyze and Interpret the Data
17

18. BMGT 411: Chapter 3
• Step #10: Present Research Findings and
Recommendations
• Often the Most important part of the process
•Should be visual and easy to understand
•Recommendations should tie back to research
objective
18

19. Visual Marketing
Research
19

20. Forecasting Measures of Market Demand
20

21. Forecasting:
The art of estimating future
demand by anticipating what
buyers are likely to do under a
given set of conditions.
21

22. BMGT 411: Chapter 3
• Potential Market: Set of consumers with a sufficient level of interest in a market
offer
• Available Market: Set of consumers who have interest, income, and access to a
particular offer
• Target Market: The part of the available market the company decides to pursue
• Penetrated Market: The set of consumers who are buying the companies
product
22

23. BMGT 411: Chapter 3
• Methods to Grow Sales:
1.Attract more buyers from the target market
2. Lower qualifications for potential buyers
3. Expand it’s market by adding stores, lowering price, or repositioning itself to
attract more buyers
23

24. BMGT 411: Chapter 3
• Total Market Demand Equation:
Q = n x q x p
Q = total market demand
n = number of buyers in the market
q = quantity purchased by an average buyer per year
p = price of an average unit
24

25. BMGT 411: Chapter 3
• US Car Total Market Potential
Q = n x q x p
Q = total market demand
n = 20,000,000
q = 1
p = $25,000
25

26. BMGT 411: Chapter 3
• US Car Total Market Potential
Q = 20,000,000 x 1 x 25,000
Q = 500,000,000
26

27. Ford’s Goal: 25% $125,000,000 Forecast
27

28. BMGT 411: Chapter 3
• Key Variables in Forecasting:
• Demographics
• Population Growth
• Population Age Mix
• Diversity
• Education
28

29. BMGT 411: Chapter 3
• Key Variables in Forecasting:
• Economics
• Consumer Psychology (Groupon Effect)
• Income Distribution
• Income, Savings, Debt, Credit
29

30. BMGT 411: Chapter 3
• Key Variables in Forecasting:
• Sociocultural
• Views of ourselves: Today, many gen y’ers are showing behaviors similar to the greatest generation (Saving, etc)
• Views of others
• Views of organizations
• Views of Society
• Views of nature
• Views of the universe
30

31. Technology
Increased innovation makes
forecasting difficult, and
changes quickly compared to
the past
31

32. BMGT 411
Chapter 4: Creating Long Term Loyalty Relationships
32

33. Apple
33

34. Kohl’s
34

35. Walmart
35

36. Zappos.com
36

37. Building Customer
Value and Satisfaction
• Customer perceived value (CPV)—the
difference between the prospective
customer’s evaluation of all the benefits and
all the costs of an offering and the
perceived alternatives.
37

38. Determinants of Customer Perceived
Value (CPV)
• Total customer value
• Product value
• Services value
• Personnel value
• Image value
• Total customer cost
• Monetary cost
• Time cost
• Energy cost
• Psychic cost
38

39. Loyalty
• A deeply held commitment to re-buy or re-
patronize a preferred product or service in
the future despite situational influences and
marketing efforts having the potential to
cause switching behavior
• What product are you loyal to?
• Why?
39

40. New Balance 990
40

41. Satisfaction
• A person’s feelings of pleasure or
disappointment that result from comparing
a product’s perceived performance (or
outcome) to expectations.
• What products or services exceed your
expectations?
• What would you do if a product or
service did not meet your expectations?
41

42. Wegmans
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43. Product and Service
Quality
• Quality (or grade) is the totality of features and
characteristics of a product or service that bear
on its ability to satisfy stated or implied needs.
43

44. Marketers’ Roles in
Delivering Quality
• Correctly identifying customers’ needs and requirements
• Communicate customer expectations properly to product designers
• Be sure orders are filled correctly and on time
• Provide customers with proper instructions, training, and technical
assistance
• Stay in touch with customers after the sale
• Gather customer ideas for improvements and convey them to the
appropriate departments
• Who do you feel is managing quality performance good today?
44

45. @comcastcares
45

46. Customer Profitability
• A profitable customer is one that over time
yields a revenue stream that exceeds by an
acceptable amount the company’s cost
stream for attracting, selling, and servicing
that customer.
46

47. Goal is to Maintain Profitable Customers
Shift Low Profit Customers Into Higher Profit Products Over Time
47

48. Customer Profitability
Analysis (CPA)
• Best conducted with an accounting
technique called Activity-Based Costing
(ABC).
• Estimate all revenue coming from the
customer, less all costs that go into serving
that customer.
48

49. Customer Lifetime
Value (CLV)
• Describes the net present value of the
stream of future profits expected over the
customer’s lifetime purchases.
49

50. CLV Equations
50

51. CLV Importance
• Example: Grocery Store
• AverageYearly Spend: $5,200 (a)
• Average LifeSpan: 30Years (t)
• Using the simple equation, what is the average
Customer Life TimeValue of a Grocery Store
Customer?
• CLV = (a x t)
• 15,000 Customers in this segment
• Segment CLV = $2,340,000,000
51

52. Cultivating Customer
Relationships
• Customer relationship management (CRM)
is the process of carefully managing detailed
information about individual customers and
all customer “touch points” to maximize
customer loyalty.
52

53. CRM Best Practices
• Identify Prospects and Customers: Don’t go after everyone. Build
and mine a customer database with information from all channels and
customer touch points
• Differentiate customers in terms of (1) their needs and (2)
their value to the company: Defend aggressively your most valuable
customers, while trying to grow relationships with less profitable customers
• Interact with individual customers to improve your
knowledge about their individual needs and to build stronger
relationships
• Customize products, services, and marketing messages to
each customer
• Who do you feel is doing this well for you?
53

54. Traditional Marketing
Funnel
54

55. Traditional Marketing
Funnel
55

56. Customer Database and Database
Marketing
• Customer database—an organized
collection of comprehensive information
about individual customers or prospects
that is current, accessible, and actionable
for marketing purposes.
• Database marketing—the process of
building, maintaining, and using customer
databases and other databases to make
contact, facilitate transactions, and build
customer relationships.
56

57. Data Warehouse and
Datamining
• Data warehouse—organized data where
marketers can capture, query, and analyze it
to draw inferences about an individual
customer’s needs and responses.
• Datamining—statisticians extract useful
information about individuals, trends, and
segments from the mass of data.
57

58. Database Uses
• Identify the best prospects
• Match a specific offer with a specific
customer as a way to sell, cross-sell, and
up-sell
• Deepen customer loyalty by remembering
preferences and offering relevant incentives
and information
58

59. Downside of Database
Marketing and CRM
• Large investment
• Difficulty in getting everyone to be
customer oriented
• Not all customers want an ongoing
relationship
• Assumptions behind CRM may not always
hold true
59

60. Wigle Whiskey
• What kind of ideas do
you have to increase
long term loyalty?
• How should Wigle use
the CLV equation?
60

61. BMGT 411: Week #3
Wood: Chapter 2: Analyzing the Current Situation
61

62. http://www.youtube.com/watch?
v=STuR40eiss4
62

63. Environmental Scanning and Analysis
Involves the analysis of :
 Internal Factors,
 External Factors, and
 Competitive Factors.
2-2
63

64. The Macro- and Microenvironments
 To formulate a flexible and practical marketing plan, one needs to
properly track and differentiate between macroenvironmental and
microenvironmental factors:
 Macroenvironmental factors are broad forces that impact overall marketing strategy
and performance.
 Microenvironmental factors more directly influence marketing strategies and activities.
 Macroenvironmental factors: political-legal, economic, social-
cultural, technological, and ecological forces.
 Microenvironmental factors: customers, competitors, channel
members, partners, suppliers, and employees.
2-3
64

65. SWOT Analysis
 SWOT stands for:
 Strengths
 Weaknesses
 Opportunities
 Threats
 A common way of organizing what you have learned from
the environmental scanning process.
 Should be conducted for both your own firm and for key
competitors.
2-4
65

66. Internal Factors
66

67. Internal Analysis: Resources
 Human
 Financial
 Informational
 Supply
2-7
67

68. Internal Analysis: Offerings
Examining what the firm is currently offering in the way of
goods and services:
 Affirm the role of each line and item.
 Consider how the offerings contribute to relationships with distributors
and customers.
 Assess fit with mission and resources.
2-8
68

69. Internal Analysis: Previous Results
 Includes:
 Sales (dollars and units)
 Profitability
 Other financial results
 Helpful to look for trends in the data.
 Helps separate the effective programs from the less-
effective programs.
2-9
69

70. Internal Analysis: Business Relationships
Includes relationships with:
 Suppliers
 Distributors
 Other business partners
Examine:
 Capacity
 Quality
 Value provided
2-10
70

71. Keys to Success:
 Identify special factors most crucial to success.
 Maintain focus on key priorities.
Warning Signs
 Indicate potential problems with leveraging the keys to success and
performing as planned.
2-11
71

72. External Factors
2-12
72

73. External Analysis: Political-Legal Trends
International, federal, state,
and local laws and
regulations:
 Competitive behavior
 Pricing
 Taxation
 Promotion
 Distribution
 Product liability
 Labeling
 Product purity, and
 Other issues…
2-13
73

74. External Analysis: Economic Trends
 Must keep an eye on
global, national, regional,
and local economic
trends.
 Some measures typically
monitored:
 Buying power
 Income
 Debt
 Credit Usage
 Consider foreign
exchange trends.
2-15
74

75. External Analysis: Social-Cultural Trends
 Consumer Demographics
 Business Demographics
 Cross-Cultural Influences
2-16
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76. External Analysis: Demographic Trends
Key consumer demographic trends include:
 Population growth
 Population composition:
 Age
 Gender
 Ethnic background
 Religious background
 Education
 Occupation
 Household size
 Income
2-17
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77. External Analysis: Bus. Demographic Trends
 Size and growth of industries
 Number of companies
 Number of locations or branches
 Number of employees
 Sales revenues
2-18
77

78. External Analysis: Cross-Cultural Influences
 Due to globalization, social and cultural trends may begin
in one market and then spread to others.
 Cross-cultural trends represent potential opportunities for
marketers.
2-19
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79. External Analysis: Technological Trends
Key trends include:
 The Internet
 Smartphones and mobile technology
 Digital media
 Incorporation of electronic capabilities into a wider range of products
2-20Copyright © 2014 Pearson Education, Inc.
79

80. External Analysis: Ecological Trends
Potential impacts:
 Availability of raw materials
 Government regulations
 Social attitudes
 “greenwashing”: positioning goods and services as ecologically friendly, even
when they are not.
2-21
80

81. External Analysis: Competitors
 Better understand market dynamics.
 Anticipate competitor activities.
 Identify:
 Current competitors
 Possible future competitors
 Learn about the unique competitive advantages of each
competitor.
2-22
81

82. BMGT 411: Week 4
• Study for Test #1
• Kottler Chapters 1-4
• Wood Chapters 1-2
• Read Chapters:
• Kottler: Chapters 5, 6, 7
• Wood: Chapters: 3, 4
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