Marketing Management Slides.

1. MARKETING MANAGEMENT
1
Defining Marketing
for the 21st Century

2. 1-2
Chapter Questions
 Why is marketing important?
 What is the scope of marketing?
 What are some of the fundamental
marketing concepts?
 How has marketing management
changed?
 What are the tasks necessary for
successful marketing management?

3. 1-3
What is Marketing?
Marketing is an organizational function
and a set of processes for creating,
communicating, and delivering value
to customers and for managing
customer relationships
in ways that benefit the
organization and its stakeholders.

4. 1-4
What is Marketing Management?
Marketing management is the
art and science
of choosing target markets
and getting, keeping, and growing
customers through
creating, delivering, and communicating
superior customer value.

5. 1-5
For an exchange to occur…..
 There are at least two parties.
 Each party has something that might be of
value to the other party.
 Each party is capable of communication
and delivery.
 Each party is free to reject the exchange
offer.
 Each party believes it is appropriate or
desirable to deal with the other party.

6. 1-6
What is Marketed?
 Goods
 Services
 Events
 Experiences
 Persons
 Places
 Properties
 Organizations
 Information
 Ideas

7. 1-7
Demand States
 Negative
 Nonexistent
 Latent
 Declining
 Irregular
 Unwholesome
 Full
 Overfull

8. 1-8
Key Customer Markets
 Consumer markets
 Business markets
 Global markets
 Nonprofit/Government markets

9. 1-9
The marketplace isn’t what it used to be….
 Changing technology
 Globalization
 Deregulation
 Privatization
 Empowerment
 Customization
 Convergence
 Disintermediation

10. 1-10
Company Orientations
 Production
 Product
 Selling
 Marketing

11. 1-11
Marketing Mix and the Customer
Four Ps
 Product
 Price
 Place
 Promotion
Four Cs
 Customer solution
 Customer cost
 Convenience
 Communication

12. 1-12
Core Concepts
 Needs, wants, and
demands
 Target markets,
positioning,
segmentation
 Offerings and brands
 Value and
satisfaction
 Marketing channels
 Supply chain
 Competition
 Marketing
environment
 Marketing planning

13. 1-13
I want it, I need it…..
5 Types of Needs
 Stated needs
 Real needs
 Unstated needs
 Delight needs
 Secret needs

14. 1-14
Marketing Management Tasks
 Developing
marketing strategies
 Capturing marketing
insights
 Connecting with
customers
 Building strong
brands
 Shaping market
offerings
 Delivering value
 Communicating
value
 Creating long-term
growth

15. MARKETING MANAGEMENT
3
Gathering Information
and Scanning the
Environment

16. 1-16
Chapter Questions_1
 What are the components of a
modern marketing information
system?
 What are useful internal records?
 What is involved in a marketing
intelligence system?

17. 1-17
Chapter Questions_2
 What are the key methods for
tracking and identifying opportunities
in the macroenvironment?
 What are some important
macroenvironment developments?

18. 1-18
MIS Probes for Information
 What decisions do you regularly make?
 What information do you need to make these
decisions?
 What information do you regularly get?
 What special studies do you periodically
request?
 What information would you want that you are
not getting now?
 What are the four most helpful improvements
that could be made in the present marketing
information system?

19. 1-19
Internal Records
 Order-to-Payment Cycle
 Sales Information System
 Databases, Warehousing, Data mining
 Marketing Intelligence System

20. 1-20
Steps to Improve Marketing Intelligence
 Train and motivate sales force
 Motivate channel members to share intelligence
 Network externally
 Utilize customer advisory panel
 Utilize government data resources
 Purchase information
 Collect customer feedback online

21. 1-21
Needs and Trends
Fad
Trend
Megatrend

22. 1-22
10 Megatrends Shaping the
Consumer Landscape
 Aging boomers
 Delayed retirement
 Changing nature of
work
 Greater educational
attainment
 Labor shortages
 Increased immigration
 Rising Hispanic
influence
 Shifting birth trends
 Widening geographic
differences
 Changing age
structure

23. 1-23
Environmental Forces
 Demographic
 Economic
 Socio-Cultural
 Natural
 Technological
 Political-Legal

24. 1-24
Population and Demographics
 Size
 Growth rate
 Age distribution
 Ethnic mix
 Educational
levels
 Household
patterns
 Regional
characteristics
 Movement

25. 1-25
Economic Environment
$ Purchasing Power
$ Income Distribution
$ Savings Rate
$ Debt
$ Credit Availability

26. 1-26
Types of Industrial Structures
 Industrial economies
 Industrializing economies
 Raw-material exporting economies
 Subsistence economies

27. 1-27
Social-Cultural Environment
 Views of themselves
 Views of others
 Views of organizations
 Views of society
 Views of nature
 Views of the universe

28. 1-28
Natural Environment
 Shortage of raw materials
 Increased energy costs
 Anti-pollution pressures
 Governmental protections

29. 1-29
Technological Environment
 Pace of change
 Opportunities for innovation
 Varying R&D budgets
 Increased regulation of change

30. MARKETING MANAGEMENT
4
Conducting
Marketing Research
and Forecasting Demand

31. 1-31
Chapter Questions
 What constitutes good marketing
research?
 What are good metrics for measuring
marketing productivity?
 How can marketers assess their
return on investment of marketing
expenditures?
 How can companies more accurately
measure and forecast demand?

32. 1-32
Marketing Research Defined
Systematic design, collection,
analysis, and reporting of data
and findings relevant to a specific
marketing situation facing a company.

33. 1-33
Types of Marketing Research Firms
 Syndicated
 Custom
 Specialty-line

34. 1-34
The Marketing Research Process
 Define the problem
 Develop the research plan
 Collect information
 Analyze information
 Present findings
 Make decision

35. 1-35
Step 1
 Define the problem
 Specify decision alternatives
 State research objectives

36. 1-36
Step 2
 Data sources
 Research approach
 Research instruments
 Sampling plan
 Contact methods

37. 1-37
Research Approaches
 Observation
 Focus group
 Survey
 Behavioral Data
 Experimentation

38. 1-38
Research Instruments
 Questionnaires
 Qualitative Measures
 Mechanical Devices

39. 1-39
 Avoid negatives
 Avoid hypotheticals
 Avoid words that could
be misheard
 Use response bands
 Use mutually exclusive
categories
 Allow for “other” in fixed
response questions
Questionnaire Do’s and Don’ts
 Ensure questions are
free of bias
 Make questions simple
 Make questions specific
 Avoid jargon
 Avoid sophisticated
words
 Avoid ambiguous words

40. 1-40
Question Types - Dichotomous
In arranging this trip, did you contact American
Airlines?
 Yes  No

41. 1-41
Question Types – Multiple Choice
With whom are you traveling on this trip?
 No one
 Spouse
 Spouse and children
 Children only
 Business associates/friends/relatives
 An organized tour group

42. 1-42
Question Types – Likert Scale
Indicate your level of agreement with the following
statement: Small airlines generally give better
service than large ones.
 Strongly disagree
 Disagree
 Neither agree nor disagree
 Agree
 Strongly agree

43. 1-43
Question Types – Semantic Differential
American Airlines
Large ………………………………...…………….Small
Experienced………………….………….Inexperienced
Modern………………………..………….Old-fashioned

44. 1-44
Question Types – Importance Scale
Airline food service is _____ to me.
 Extremely important
 Very important
 Somewhat important
 Not very important
 Not at all important

45. 1-45
Question Types – Rating Scale
American Airlines’ food service is _____.
 Excellent
 Very good
 Good
 Fair
 Poor

46. 1-46
Question Types –
Intention to Buy Scale
How likely are you to purchase tickets on American
Airlines if in-flight Internet access were available?
 Definitely buy
 Probably buy
 Not sure
 Probably not buy
 Definitely not buy

47. 1-47
Question Types –
Completely Unstructured
What is your opinion of American Airlines?

48. 1-48
Question Types – Word Association
What is the first word that comes to your mind
when you hear the following?
Airline ________________________
American _____________________
Travel ________________________

49. 1-49
Question Types – Sentence Completion
When I choose an airline, the most important
consideration in my decision is:
________________________________________
________________________________________
________________________________________
________________________________________
________________________________________
________________________________________.

50. 1-50
Question Types – Story Completion
“I flew American a few days ago. I noticed that the
exterior and interior of the plane had very bright
colors. This aroused in me the following thoughts
and feelings.” Now complete the story.
________________________________________
________________________________________
________________________________________
________________________________________
________________________________________
________________________________________

51. 1-51
Question Types –
Picture (Empty Balloons)

52. 1-52
Qualitative Measures
 Shadowing
 Behavior mapping
 Consumer journey
 Camera journals
 Extreme user interviews
 Storytelling
 Unfocused groups

53. 1-53
Mechanical Devices
 Galvanometers
 Tachistoscope
 Eye cameras
 Audiometers
 GPS

54. 1-54
Sampling Plan
 Sampling unit: Who is to be surveyed?
 Sample size: How many people should be
surveyed?
 Sampling procedure: How should the
respondents be chosen?

55. 1-55
Types of Samples
Probability
 Simple random
 Stratified random
 Cluster
Nonprobability
 Convenience
 Judgment
 Quota

56. 1-56
Contact Methods
 Mail questionnaire
 Telephone interview
 Personal interview
 Online interview

57. 1-57
Characteristics of Good
Marketing Research
 Scientific method
 Research creativity
 Multiple methods
 Interdependence
 Value and cost of information
 Healthy skepticism
 Ethical marketing

58. 1-58
Table 4.4 Marketing Metrics
 External
 Awareness
 Market share
 Relative price
 Number of complaints
 Customer satisfaction
 Distribution
 Total number of
customers
 Loyalty
 Internal
 Awareness of goals
 Commitment to goals
 Active support
 Resource adequacy
 Staffing levels
 Desire to learn
 Willingness to change
 Freedom to fail
 Autonomy

59. 1-59
Table 4.5 Sample Customer-
Performance Scorecard Measures
 % of new customers to average #
 % of lost customers to average #
 % of win-back customers to average #
 % of customers in various levels of satisfaction
 % of customers who would repurchase
 % of target market members with brand recall
 % of customers who say brand is most preferred

60. 1-60
Tools to Measure Marketing Plan
Performance
 Sales analysis
 Market share analysis
 Expense-to-Sales Analysis
 Financial Analysis

61. 1-61
Sales Analysis
 Sales-Variance Analysis
 Micro-Sales Analysis

62. 1-62
Market Share Analysis
 Overall market share
 Served market share
 Relative market share

63. 1-63
Marketing-Profitability Analysis
Step 1: Identifying Functional Expenses
Step 2: Assigning Functional Expenses to
Marketing Entities
Step 3: Preparing a Profit-and-Loss Statement
for each Marketing Entity

64. 1-64
Distinguishing Types of Costs
 Direct
 Traceable common
 Nontraceable common

65. 1-65
The Measures of Market Demand
 Potential market
 Available market
 Target market
 Penetrated market

66. 1-66
Estimating Current Demand
 Total market potential
 Area market potential
Market buildup method
Multiple-factor index method
 Brand development index

67. 1-67
Estimating Future Demand
 Survey of Buyers’ Intentions
 Composite of Sales Force Opinions
 Expert Opinion
 Past-Sales Analysis
 Market-Test Method

68. 1-68
Purchase Probability Scale
Do you intend to buy an automobile within
the next 6 months?
0.00 No
0.20 Slight possibility
0.40 Fair possibility
0.60 Good possibility
0.80 High possibility
1.00 Certain

69. MARKETING MANAGEMENT
6
Analyzing
Consumer Markets

70. 1-70
Chapter Questions
 How do consumer characteristics influence
buying behavior?
 What major psychological processes
influence consumer responses to the
marketing program?
 How do consumers make purchasing
decisions?
 How do marketers analyze consumer
decision making?

71. 1-71
What Influences Consumer Behavior?
 Cultural factors
 Social factors
 Personal factors

72. 1-72
Culture
The fundamental determinant of
a person’s wants and behaviors
acquired through socialization
processes with family
and other key institutions.

73. 1-73
Subcultures
 Nationalities
 Religions
 Racial groups
 Geographic regions
 Special interests

74. 1-74
Fast Facts About American Culture
 The average American
chews 300 sticks of gum a year
goes to the movies 9 times a year
takes 4 trips per year
attends a sporting event 7 times each year

75. 1-75
Social Classes
Upper uppers
Lower uppers
Upper middles
Middle class
Working class
Upper lowers
Lower lowers

76. 1-76
Characteristics of Social Classes
 Within a class, people tend to behave
alike.
 Social class conveys perceptions of
inferior or superior position.
 Class may be indicated by a cluster of
variables (occupation, income, wealth).
 Class designation is mobile over time.

77. 1-77
Social Factors
Reference
groups
Social
roles
Statuses
Family

78. 1-78
Reference Groups
 Membership
 Primary
 Secondary
 Aspirational
 Dissociative

79. 1-79
Family
 Family of Orientation
Religion
Politics
Economics
 Family of Procreation
Everyday buying behavior

80. 1-80
Personal Factors
 Age
 Life cycle stage
 Occupation
 Wealth
 Personality
 Values
 Lifestyle
 Self-concept

81. 1-81
Brand Personality
 Sincerity
 Excitement
 Competence
 Sophistication
 Ruggedness

82. 1-82
Key Psychological Processes
 Motivation
 Perception
 Learning
 Memory

83. 1-83
Motivation
 Freud’s theory
 Maslow’s hierarchy of needs
 Herzberg’s two-factor theory

84. 1-84
Perception
 Selective attention
 Selective retention
 Selective distortion
 Subliminal perception

85. 1-85
Figure 6.4 Consumer Buying Process
 Problem recognition
 Information search
 Evaluation
 Purchase decision
 Postpurchase behavior

86. 1-86
Sources of Information
 Personal
 Commercial
 Public
 Experiential

87. 1-87
Non-compensatory Models of Choice
 Conjunctive
 Lexicographic
 Elimination-by-aspects

88. 1-88
Perceived Risk
 Functional
 Physical
 Financial
 Social
 Psychological
 Time

89. 1-89
Other Theories of
Consumer Decision Making
Involvement
 Elaboration
Likelihood Model
 Low-involvement
marketing
strategies
 Variety-seeking
buying behavior
Decision Heuristics
 Availability
 Representativeness
 Anchoring and
adjustment

90. 1-90
Mental Accounting
 Consumers tend to…
Segregate gains
Integrate losses
Integrate smaller losses with larger gains
Segregate small gains from large losses

91. MARKETING MANAGEMENT
7
Analyzing
Business Markets

92. 1-92
Chapter Questions
 What is the business market, and how does
it differ from the consumer market?
 What buying situations do organizational
buyers face?
 Who participates in the business-to-
business buying process?

93. 1-93
Chapter Questions
 How do business buyers make their
decisions?
 How can companies build strong
relationships with business customers?
 How do institutional buyers and
government agencies do their buying?

94. 1-94
Organizational Buying
Decision-making process by which
formal organizations establish the
need for purchased products and
services, and identify
evaluate, and choose among
alternative brands and suppliers.

95. 1-95
Characteristics of Business
Markets
 Fewer, larger buyers
 Close supplier-
customer
relationships
 Professional
purchasing
 Many buying
influences
 Multiple sales calls
 Derived demand
 Inelastic demand
 Fluctuating demand
 Geographically
concentrated buyers
 Direct purchasing

96. 1-96
Buying Situation
 Straight rebuy
 Modified rebuy
 New task

97. 1-97
The Buying Center
 Initiators
 Users
 Influencers
 Deciders
 Approvers
 Buyers
 Gatekeepers

98. 1-98
Of Concern to Business Marketers
 Who are the major decision participants?
 What decisions do they influence?
 What is their level of influence?
 What evaluation criteria do they use?

99. 1-99
Types of Business Customers
 Price-oriented
 Solution-oriented
 Gold-standard
 Strategic-value

100. 1-100
Handling Price-Oriented Customers
 Limit quantity purchased
 Allow no refunds
 Make no adjustments
 Provide no services

101. 1-101
Purchasing Orientations
 Buying
 Procurement
 Supply chain management

102. 1-102
Product-Related Purchasing Processes
 Routine products
 Leverage products
 Strategic products
 Bottleneck products

103. 1-103
Methods of e-Procurement
 Websites organized using vertical hubs
 Websites organized using functional hubs
 Direct extranet links to major suppliers
 Buying alliances
 Company buying sites

104. 1-104
Forms of Electronic Marketplaces
 Catalog sites
 Vertical markets
 Pure play auction sites
 Spot markets
 Private exchanges
 Barter markets
 Buying alliances

105. 1-105
Assessing Customer Value
 Internal engineering
assessment
 Field value-in-use
assessment
 Focus-group value
assessment
 Direct survey
questions
 Conjoint analysis
 Benchmarks
 Compositional
approach
 Importance ratings

106. 1-106
Order Routine Specification and
Inventory
 Stockless purchase plans
 Vendor-managed inventory
 Continuous replenishment

107. 1-107
Desirable Outcomes of a B2B
transaction: OTIFNE
 On time
 In full
 No error

108. 1-108
Establishing Corporate Credibility
 Expertise
 Trustworthiness
 Likeability

109. 1-109
Factors Affecting
Buyer-Supplier Relationships
 Availability of alternatives
 Importance of supply
 Complexity of supply
 Supply market dynamism

110. 1-110
Categories of Buyer-Seller
Relationships
 Basic buying and
selling
 Bare bones
 Contractual
transaction
 Customer supply
 Cooperative systems
 Collaborative
 Mutually adaptive
 Customer is king

111. 1-111
Opportunism
Some form of cheating or
undersupply relative to an
implicit or explicit contract.