Chapter 3 Objectives The Marketing Environment

1
Chapter 3 ObjectivesThe Marketing Environment

• Describe the environmental forces that affect the
  company's ability to serve its customers.
• Explain how changes in the demographic and
  economic environment affect marketing decisions.
• Identify the major trends in the firm's natural
  and technological environments.
• Explain the key changes in the political and
  cultural environment.
• Discuss how companies can react to the marketing
  environment.

2
Microenvironmentinternal forces
Customers
Marketing Intermediaries
Suppliers
Publics
Company
Competitors
Company
3
The Company
4
Microenvironmentinternal forces
Customers
Marketing Intermediaries
Suppliers
Publics
Company
Competitors
Company
5
Macroenvironmentexternal forces
Technological
Natural
Economic
Political
Demographic
Cultural
Company
6
Demographics

• Family
• Population Shift
• Education
• Increasing Diversity

7
DemographicsChanging Age Structure in Canada

• Median age up from 25 to 38 in 30 years
• Long-term slowing of birth rate (1.55)
• Increasing life expectancy
• Baby dearth of the 70s
• Population bulge due to baby boom
• Growth rates vary for different age groups

8
Canadas Boomer Bulge
9
Demographics

• BOOMERS
• 40 plus age now 45 bigger than 18-30 group
• will be 60 bigger by 2010
• 1989 40 became biggest adult segment in history
• Control 50 of discretionary spending
• Control 75 of nations wealth
• About to inherit largest intergenerational wealth
  transfer in history

10
Demographic EnvironmentIncreasing Diversity

• Ethnicity
• Ethnic purchasing power 300 billion
• Growing market size
• Avoid stereotyping
• Use native languages
• Choose ethnic media
• Sexual orientations
• Disabilities

11
Macroenvironmentexternal forces
Technological
Natural
Economic
Political
Demographic
Cultural
Company
12
Economics

• Changes in Income
• More Work Less Leisure people are
  time starved
• Changing Consumer Spending Patterns

13
Consumer Confidence

Consumer confidence fell to its lowest level
since October 1983. Conference
Board, Feb. 2003
14
Consumer Confidence

Consumer confidence tanked in February and has
been rebounding since. Decima
Research, 2003
15
Natural Environment

• Shortages of Raw Materials
• Increased Pollution
• Increased Government Intervention e.g.
  Environmental Protection Act

16
Technological Environment

• Fast pace of technological change
• High RD Budgets

17
Political Environment

• Legislation regulating business
• increased legislation
• increased emphasis on ethics and socially
  responsible actions

18
Cultural Environment

• Persistence of cultural values
• Shifts in cultural values
• Subcultures

19
Microenvironmentinternal forces
Customers
Marketing Intermediaries
Suppliers
Publics
Company
Competitors
Company
20
Chapter 18 ObjectivesMarketing and Society

• Identify the major social criticisms of
  marketing.
• Define consumerism and environmentalism and
  explain how they affect marketing strategies.
• Describe the principles of socially responsible
  marketing.
• Explain the role of ethics in marketing.

21
Social Criticisms of Marketing
High Prices Deceptive Practices
High-Pressure Selling
Marketings Impact on Consumers
Shoddy Products Planned Obsolescence Poor
Service
22
Social Criticisms of Marketing
False Wants/Too Much Materialism Too Few Social
Goods
Marketings Impact on Society
Cultural Pollution Too Much Political Power
23
Consumerism
Consumers Association of Canada Fundamental
Rights

• The right to safety
• Right to be informed
• The right to choose
• The right to be heard
• The right to redress against damage
• The right to consumer education

24
Chapter 4 ObjectivesMarketing Research and
Information Systems

• Explain the importance of information to the
  company.
• Define the marketing information system and
  discuss its parts.
• Outline the four steps in the marketing research
  process.
• Compare the advantages and disadvantages of
  various methods of collecting information.
• Discuss the special issues some marketing
  researchers face.

25
Measuring Forecasting Demand

• 1. As marketing manager for Cat's Pride cat
  litter, you have seen sales jump 50 percent in
  the last year after years of relatively stable
  sales. Explain how you will forecast sales for
  the coming year.
• 2. What are some leading indicators that might
  help you predict sales of diapers, cars, and
  hamburgers. Can you describe a general procedure
  for finding leading indicators or product sales?

26
The Importance of Information
Competitors
Marketing Environment
Research Needs
Strategic Decision Making
Customer Needs and Wants
27
Should you do Research?

• NO if
• being done before financial analysis complete
• a way to avoid making a decision
• results are not going to change your plans
• cheaper to try idea than conduct research
• YES if
• data will be useful in a very specific way
• you can get the information you need to make
  decisions
• you cant afford to make an uniformed decision
• you must convince others of something you already
  know

28
Market Research Process
Define problem and research objectives
Implement collect and analyze data
Interpret and report findings
Develop plan to collect data
4-2
29
Step 1 defining the problem
research objectives

• Exploratory research
• preliminary information
• helps better define problem
• Descriptive research
• expand understanding of factors
• Causal research
• test cause and effect hypothesis

30
Step 2 developing the plan for
collecting information

• Determine Specific Information Needs, e.g.
• Target customer characteristics
• Patterns of product use (which day-part?)
• Demand factors
• Response of marketing channels
• Customer reactions
• Projected sales

31
Step 2 developing the plan for
collecting information

• Gathering Secondary Data
• internal sources
• government sources
• books and periodicals
• commercial data services
• international data
• on-line databases and the internet
• syndicated research studies

32
Step 2 developing the plan for
collecting information

• Gathering Primary Data
• Research Approaches
• Observational
• Survey phone, mail, in-person
• Experimental

33
Primary Data Collection Contact Methods
strengths weaknesses
Mail Questionnaire
Large volume, Low cost Honest answers, Slow, Not
very flexible
Telephone Interview
Fast, Controlled sample, Flexible, Higher
Response, More expensive, Bias
Personal Interview
Very flexible, Fast, Very expensive, Bias
34
Step 3 implementing the research plan

• Plan is put into action
• most expensive part of the process so
• 1) important to watch for interviewer bias
• 2) accuracy

35
Step 4 interpreting and reporting
findings

• Present important findings
• Company ultimately must decide on correct
  interpretation and how to proceed

36
Difficulties in Asking Questions of Consumers

• Do they really know whether they are likely to
  buy a particular product?
• Even if they know the answer, will they tell you?
• Will their actual purchase behaviour mirror their
  stated interests/intentions?

37
Chapter 5 ObjectivesConsumer Markets and
Consumer Buying Behaviour

• Define the consumer market and construct a simple
  model of consumer buyer behaviour.
• Name the four major factors that influence
  consumer buyer behaviour.
• List and understand the stages in the buyer
  decision process.
• Describe the adoption and diffusion process for
  new products.

38
Factors Affecting Consumer Behaviour
Cultural Culture Sub- culture Social class
Social Reference groups Family Roles and sta
tus
Personal Age and life-cycle Occupation Economi
c situation Lifestyle Personality and self-conce
pt
Psycho- logical Motivation Perception Learning
Beliefs and attitudes
39
Cultural Factors

• Culture
• Social Class
• Sub-culture

40
Social Factors

• Groups
• reference groups
• aspirational groups
• Family
• Roles Status

41
Personal Factors

• Age Lifecycle Stage
• Occupation
• Economic situation
• Personality Self-Concept
• Lifestyle

42
Psychological Factors

• Motivation
• Perception
• Learning
• Beliefs Attitudes

Self-Actualtization
Social needs
Esteem needs
Safety needs
Physiological needs
43
VALS2 Lifestyle Classification
Actualizers
Abundant Resources
Achievers
Experiencers
Fulfilleds
Principle Oriented
Status Oriented
Action Oriented
Strivers
Makers
Believers
Strugglers
Minimal Resources
44
Buyer Decision Process
Need recognition
Information search
Evaluation of alternatives
Purchase decision
Post-Purchase behaviour
45
Types of Buying Behaviour
Low involvement
High involvement
Complex buying behaviour
Variety- seeking behaviour
Significant differences between brands
Dissonance reducing behaviour
Habitual buying behaviour
Few differences between brands
46
Adopter Categorizationrelative time of adoption
34 Early majority
34 Late majority
13.5
2.5 Innovators
Early adopters
16 Laggards
Time of adoption of innovations
47
Chapter 6 ObjectivesBusiness Markets and
Business Buying Behaviour

• Define the business market and explain how
  business markets differ from consumer markets.
• Identify the major factors that influence
  business buyer behaviour.
• List and define the steps in the business
  buying-decision process.
• Compare the institutional and government markets
  and explain how institutional and government
  buyers make buying decisions.

48
Characteristics of Business Markets
Differences Between Business and Consumer Market
s
Market Structure and Demand
Nature of the Buying Unit
Types of Decisions the Decision Process
Other Characteristics
49
Characteristics of Business Markets
Differences Between Business and Consumer Market
s
Market Structure and Demand
1. Fewer but larger buyers 2. More
geographically concentrated 3. Demand is
more inelastic 4. Demand is derived 5. Demand
fluctuates quickly
50
Characteristics of Business Markets
Differences Between Business and Consumer Market
s
Nature of the Buying Unit
1. Involves more buyers 2. More professional
purchasing procedures
51
Characteristics of Business Markets
Differences Between Business and Consumer Market
s
1. More complex 2. More formal 3. Buyer-seller
relationships more dependent, long-term
relationships
Types of Decisions the Decision Process
52
Characteristics of Business Markets
Differences Between Business and Consumer Market
s
1. Buy direct v.s. via retailer 2. Practice
reciprocity 3. Often lease v.s. purchase
Other Characteristics
53
Business Buying Influences
Level of primary demand Economic outlook Cost
of money Supply conditions Rate of
techno- logical change Political, regulatory deve
lopments Competitive developments
Environmental
Objectives Policies Procedures Organizational s
tructure Systems
Organizational
Authority Status Empathy Persuasive- ness
Interpersonal
Age Education Occupation Personality Risk
attitudes
Individual
54
Business Buying Process
1. Problem Recognition
2. General Need Description
3. Product Specification
4. Supplier Search
5. Proposal Solicitation
6. Supplier Selection
7. Order Routine Specification
8. Performance Review
55
Institutions Government
Institutional Markets
Low Budgets
Captive Patrons
Government Markets
Centralized Buying
Submitted Bids
Public Review
Outside Publics
Non-economic Criteria
56
Chapter 7 ObjectivesSegmentation, Targeting,
Positioning

• Define the three steps of target marketing
  segmentation, targeting, positioning.
• List and discuss the major levels of market
  segmentation and the bases for segmenting
  consumer and business markets.
• Explain how companies identify attractive market
  segments and choose a market-coverage strategy.
• Explain how companies can position their products
  for maximum competitive advantage.

57
Steps in Market Segmentation, Targeting, and
Positioning
Market positioning
6. Develop marketing mix for each target segment
5. Develop positioning for each target segment
Market targeting
4. Select the target segment(s)
3. Develop measures of segment attractiveness
Market segmentation
2. Develop profiles of resulting segments
1. Identify bases for segmenting the market
58
Segmenting 4 bases

• Geographic
• Demographic
• Psychographic
• Behaviouristic

59
Segmenting geographic base

• Divide market into separate geographic units
• Nations, regions provinces, cities,
  neighbourhoods, etc.
• Develop appropriate marketing programs

60
Segmenting demographic base

• Most popular method
• Divide market into groups based on
• age
• sex
• family size lifecycle
• income occupation
• education
• religion
• ethnic background

61
Demographics - age

• 14 of population over 65
• 90 of 50 are debt free
• 48 of all luxury cars sold are purchased by 50
  group
• 50 age group controls 80 of Canadas personal
  wealth up have 2/3 of disposable income 25 of
  population
• Most healthy and active

62
Segmenting psychographic base

• Social class
• determines choice of home, car, clothes, leisure
  habits, etc.
• Lifestyle
• reflected in purchases
• e.g. couch potatoes, sports enthusiasts, or
  symphony lovers
• Personality
• express who they are

63
Segmenting behavioural base

• Divide market into groups based on
• Occasions
• User Status
• Usage Rate
• Loyalty Status
• Benefits sought

64
Requirements for effective segmentation
Requirements for Effective Segmentation
Measurability
Accessibility
Substantiality
Actionability
65
Requirements for effective segmentation

• Measurability - size, purchasing power, profiles
  of segments
• Accessibility - effectively reach and serve
• Substantiality - segments are large or profitable
  enough to serve
• Actionability - effective programs can be
  designed to attract segments

66
Market Targetingevaluating market segments

• Segment size and growth
• Structural attractiveness
• Company objectives and resources

67
Selecting Market Segments
Company marketing mix
Market
Undifferentiated marketing
Company marketing mix 1
Segment 1
Company marketing mix 2
Segment 2
Company marketing mix 3
Segment 3
Differentiated marketing
Segment 1
Company marketing mix
Segment 2
Segment 3
Concentrated marketing
68
Positioning

• Defined by consumers on important attributes
• Place in mind relative to competing products
• Position happens - planned or not

69
Positioning Strategychoosing and implementing
Communicate and deliver chosen position
Select an overall positioning strategy
Select the right competitive advantage
Identify possible competitive advantage
70
Positioning
71
Positioning Statement

• For (target customer)
• Who (statement of need or opportunity)
• The (product name) is a (product category)
• That (statement of key benefit)
• Unlike (primary competitive alternative)
• Our product (statement of primary
  differentiation)

72
Chapter 8 ObjectivesProduct Strategies

• Define product and the major classifications of
  products and services.
• Describe the roles of product and service
  branding, packaging, labelling, and product
  support services.
• Explain the decisions companies make when
  developing product lines and mixes.
• Identify the four characteristics of a service.
• Discuss the additional marketing considerations
  that services require.

73
Levels of Product
Installation
Augmented product
Packaging
Actual product
Brand name
Core benefit or service
Features
Delivery and credit
Core product
After- Sale service
Quality level
Design
Warranty
8-1
74
Product Classificationsconsumer products
Unsought products
Specialty products
Types of Consumer Products
Shopping products
Convenience products
75
Product Decisions
76
Product Attributes

• Quality
• Features
• Sizes
• Design

77
Product Support Services

• Services that augment the actual product
• e.g. 1-800 support for software program
• e.g. web/Internet technical support

78
Branding

• Name, term, sign, symbol or design or a
  combination intended to identify goods or
  services of a seller or group to differentiate
  them from competitors

79
Brand Name Selectiondesirable qualities
Craftsman

• Suggest benefits and qualities
• Easy to pronounce recognize remember
• Distinctive
• Translated easily
• Capable of registration legal protection

80
Major Branding Decisions
To brand or not to brand

• Brand
• No brand

Figure 8- 3
Brand name selection

• Selection
• Protection

Brand sponsor

• Manufacturers brand
• Private brand
• Licensed brand
• Co-branding

Brand strategy

• New brands
• Line extensions
• Brand extensions
• Multibrands

Brand repositioning

• Brand repositioning
• No brand repositioning

81
Value of Branding
Sellers viewpoint
Buyers viewpoint

• Helps consumers shop more efficiently
• Aids repeat purchase
• Suggests quality of product

• Creates store loyalty
• Gives legal protection
• Helps in segmenting markets
• Symbol of ongoing promise

82
Packaging/Labelling

• What should the package do for the product?
• identify, describe,
• and promote
• Elements support position strategy
• Environmental issues?

83
Chapter 9 ObjectivesNew Product Development and
Life Cycle Strategies

• Explain how companies find and develop new
  product ideas.
• List and define the steps in the new-product
  development process.
• Describe the stages of the product life cycle.
• Describe how marketing strategies evolve during
  the products life cycle.

84
New Product Development Process
Marketing strategy
Concept Development testing
Idea screening
Idea generation
9-1
85
Marketing Strategy Development

• Part one
• Target market
• Planned product positioning
• Sales, market share and profit goals (short term)
• Part two
• Outline price, distribution and first year
  marketing budget
• Part three
• Planned long-run sales
• Profit goals
• Marketing mix strategy

86
New Product Development Process
Marketing strategy
Business analysis
Concept Development testing
Product development
Idea screening
Test marketing
Commercialization
Idea generation
9-1
87
Why do new products fail?

• Overestimated market or target market is too
  small
• Poor design
• Poor product quality
• Incorrect positioning
• Error in pricing
• Poor marketing communication
• Competition

88
Product Life-Cycle Strategies
Sales Profit ()
Sales
Profits
Loss ()
Growth
Decline
Development
Introduction
Maturity
9-2
89
New Product Life Cycle Strategies
Introduction
MarketSkimming
MarketPenetration
90
New Product Life Cycle Strategies
Growth
New Features
Improve Quality
Add Channels
New Segments
91
New Product Life Cycle Strategies
Maturity
Product Modification
Market Modification
Modify Marketing Mix
92
New Product Life Cycle Strategies
Decline
Maintain
Harvest
Drop
93
Chapter 10 ObjectivesPricing Strategies

• Identify and define the internal factors
  affecting a firms pricing decisions.
• Identify and define the external factors
  affecting pricing decisions.
• Contrast the three general approaches to setting
  prices.
• Describe the major strategies for pricing new
  products.
• Discuss the key issues related to price changes.

94
Factors Affecting Pricing

• Internal factors
• Marketing
• objectives
• Marketing-mix
• strategy
• Costs
• Organizational
• considerations

• External factors
• Nature of the
• market demand
• Competition
• Other environmental
• factors (economy,
• resellers,
• government)

Pricing decisions
95
Internal Factors

• Internal factors
• Marketing
• objectives
• Marketing-mix
• strategy
• Costs
• Organizational
• considerations

Pricing decisions
96
External Factors

• External factors
• Types of markets
• Price-demand
• relationship
• Competition
• Other environmental
• factors (economy,
• resellers,
• government)

Pricing decisions
97
Demand Curves
P2
P2
Price
P1
P1
Q1
Q2
Q1
Q2
Quantity demanded per period Inelastic demand
Quantity demanded per period Elastic demand
98
External Factors

• External factors
• Types of markets
• Price-demand
• relationship
• Competition
• Other environmental
• factors (economy,
• resellers,
• government)

Pricing decisions
99
General Pricing Approaches
1. Cost-Based Approaches
Cost-Plus Break-Even
Target Profit Pricing
Analysis
Pricing
100
General Pricing Approaches
1. Cost-Based Approaches
2. Value-Based Approaches
Perceived Value Pricing
101
General Pricing Approaches
1. Cost-Based Approaches
2. Value-Based Approaches
3. Competition-Based Approaches
Going-Rate Pricing Sealed-Bid
Pricing
102
New Product Pricing Strategies
Market Skimming

• setting a high price to maximize revenue
• makes sense when
• product quality and image supports a higher price
• costs of producing a small volume are not too
  high to cancel the advantage of charging more
• company has a patent or technological advantage

103
New Product Pricing Strategies
Market Penetration

• Setting a low price to attract a large number of
  buyers and gain a dominant market share
• makes sense when
• market is highly price sensitive (low price
  stimulates sales and market growth)
• production costs must fall as volume increases
• low price must be an effective entry barrier for
  competitors

104
Product-Mix Pricing Strategies
Product Line Pricing
189.99
149.99
129.99
89.99
49.99
105
Product-Mix Pricing Strategies
Product Line Pricing
Captive Product Pricing
106
Product-Mix Pricing Strategies
Product Line Pricing
Captive Product Pricing
Product Bundle Pricing
107
Price Adjustment Strategies
Discount Allowance Pricing
Segmented Pricing
Psychological Pricing
Promotional Pricing
Geographical Pricing
International Pricing
108
Chapter 11 ObjectivesDistribution Channels and
Logistics Management

• Explain why companies use distribution channels
  and explain the functions that these channels
  perform.
• Discuss how channel members interact and organize
  to perform the work of the channel.
• Identify the major channel alternatives.
• Discuss the nature and importance of physical
  distribution
• Analyze integrated logistics management.

109
Chapter 12 ObjectivesRetailing and Wholesaling

• Explain the roles of retailers and wholesalers in
  the distribution channel.
• Describe the major types of retailers and give
  examples of each.
• Identify the major types of wholesalers and give
  examples of each.
• Explain the marketing decisions facing retailers
  and wholesalers.

110
Distribution (Place)

• Good distribution is critical to the marketing
  success of products
• Three main types of channels
• Direct
• Indirect
• Hybrid

111
Consumer Marketing Channels
Direct
Manu- facturer
Consumer
Indirect
Manu- facturer
Consumer
Retailer
Indirect
Manu- facturer
Whole- saler
Retailer
Consumer
Indirect
Whole- saler
Retailer
Manu- facturer
Jobber
Consumer
112
Hybrid Marketing Channel
Consumer segment 1
Catalogues, telephone
Consumer segment 2
Retailers
Producer
Business segment 1
Dealers
Distributors
Sales force
Business segment 2
113
Distribution Channel Functions

• Information gathering and distributing marketing
  research
• Promotion
• Contact finding and communicating with
  prospective buyers
• Matching offers to buyers needs
• Negotiation
• Physical distribution, financing, risk taking

114
Why Use Marketing Intermediaries?
An intermediary reduces the number of channel
transactions
of contacts without a distributor M x C 3 x 3
9
of contacts with a distributor M x C 3 3 6
115
Vertical Marketing Systems (VMS)
Administered VMS
Contractual VMS
Corporate VMS
Franchise organizations
Retailer cooperatives
Wholesaler-sponsored voluntary chains
Manufacturer-sponsored retailer franchise
Manufacturer- sponsored wholesaler franchise
Service-firm- sponsored franchise
Figure 12-4
116
Major Logistics Functions
Nature of Distribution
Order Processing
Warehousing
Inventory
Transportation
117
Chapter 13 ObjectivesIntegrated Marketing
Communication Strategy

• Name and define the five tools of the promotion
  mix.
• Discuss the processes and advantages of
  integrated marketing communications.
• Outline the steps in developing effective
  marketing communication.
• Explain the methods for setting the promotion
  budget and factors that affect the design of the
  promotion mix.

118
Promotion Mix
Personal Selling
Advertising
Promotion Mix
Direct Marketing
Sales Promotion
Public Relations
119
Marketing Communications Mix

• Advertising
• paid placement of a message in the media
• non-personal presentation and promotion of ideas,
  goods, or services
• identified sponsor

120
Marketing Communications Mix

• Sales Promotion
• short-term incentives
• to encourage the sale of a product or service

121
Marketing Communications Mix

• Personal Selling
• personal presentation by a firms sales force
• for the purpose of making sales and building
  customer relationships

122
Marketing Communications Mix

• Public Relations
• free placement of a message in the media
• on-going process of building good relations with
  the companys various publics by
• obtaining favourable publicity
• building a good corporate image
• handling stories or events
• heading off unfavorable rumours

123
Marketing Communications Mix

• Direct Marketing
• direct communications with carefully targeted
  individual consumers
• to obtain an immediate response using mail,
  telephone, fax, e-mail and other non-personal
  tools

124
Steps in Developing Effective Communication

• 1. Identify the target audience

125
Steps in Developing Effective Communication

• 1. Identify the target audience
• 2. Determine the desired response

126
Buyer-Readiness Stages
Awareness
Knowledge
Liking
Purchase
Conviction
Preference
127
Steps in Developing Effective Communication

• 1. Identify the target audience
• 2. Determine the desired response
• 3. Design a message

128
Designing a message

• Message Content
• rational - emotional - moral appeal?
• Message Structure
• open vs. conclusion?
• one side or two sides?
• Message Format
• words - images - colour - sounds - expressions?

129
Steps in Developing Effective Communication

• 1. Identify the target audience
• 2. Determine the desired response
• 3. Design a message
• 4. Choose the media

130
Choosing media

• Personal channels
• face to face, phone, email, mail
• allows personal contact and feedback
• Non-personal channels
• major media e.g. print, radio, tv, etc.
• no personal contact or feedback
• Opinion leaders key to reaching others

131
Choosing Advertising Media

• 1. Reach
• of people in your target market reached
• 2. Frequency
• how often people in your target market
• see your promotions
• 3. Impact

132
Steps in Developing Effective Communication

• 1. Identify the target audience
• 2. Determine the desired response
• 3. Design a message
• 4. Choose the media
• 5. Select the message source

133
Selecting the message source

• Credible sources more persuasive
• Credible people, e.g. doctors, dentists,
  health-care providers
• Celebrity endorsers

134
Steps in Developing Effective Communication

• 1. Identify the target audience
• 2. Determine the desired response
• 3. Design a message
• 4. Choose the media
• 5. Select the message source
• 6. Collect feedback

135
Collecting feedback

• Question target audience members
• Remember message?
• Specific points?
• How they feel?
• Attitudes changed?
• Measure behaviour

136
Setting the Promotion Budget

• Affordable method
• Percent of sales
• Competitive parity
• Objective and task

137
Chapter 14 ObjectivesAdvertising, Sales
Promotion and Public Relations

• Define the roles of advertising, sales promotion,
  and public relations in the promotion mix.
• Describe the major decisions involved in
  developing an advertising program.
• Explain how sales promotion campaigns are
  developed and implemented.
• Explain how companies use public relations to
  communicate with their publics.

138
Promotion Tools
Advertising Legitimate Public
Repetition Expensive
The Nature of Each Promotion Tool
139
Promotion Tools
Advertising Legitimate Public
Repetition Expensive
The Nature of Each Promotion Tool
Personal Selling Effective Costly Two Way
Relationships
140
Promotion Tools
Advertising Legitimate Public
Repetition Expensive
The Nature of Each Promotion Tool
Personal Selling Effective Costly Two Way
Relationships
Sales Promotion Timing Incentive Short Term
141
Promotion Tools
Advertising Legitimate Public
Repetition Expensive
The Nature of Each Promotion Tool
Personal Selling Effective Costly Two Way
Relationships
Sales Promotion Timing Incentive Short Term
Public Relations Credibility Under Used
142
Major Advertising Decisions
143
Setting the Promotion Mix
Factors in Setting the Promotion Mix
Type of Market
Buyer Readiness
Stage in Product Life Cycle
Push or Pull
144
Type of Market
145
Setting the Promotion Mix
Factors in Setting the Promotion Mix
Type of Market
Buyer Readiness
Stage in Product Life Cycle
Push or Pull
146
Push versus Pull Strategy
Producer marketing activities
Reseller marketing activities
Retailers and Wholesalers
Consumers
Producer
Push strategy
Demand
Demand
Consumers
Retailers and Wholesalers
Producer
Producer marketing activities
Pull strategy
147
Setting the Promotion Mix
Factors in Setting the Promotion Mix
Type of Market
Buyer Readiness
Stage in Product Life Cycle
Push or Pull
148
Chapter 15 ObjectivesPersonal Selling

• Discuss the role of a companys salespeople in
  creating value for customers and building
  customer relationships.
• Explain how companies design sales force strategy
  and structure.
• Explain how companies recruit, select, and train
  salespeople.
• Describe how companies compensate and supervise
  salespeople and how they evaluate sales-force
  effectiveness.
• Discuss the personal selling process.

149
Steps in Effective Selling
Prospecting and qualifying
Pre-approach
Approach
Presentation and demonstration
Follow-up
Closing
Handling objections
150
Chapter 16 ObjectivesDirect and Online Marketing

• Discuss the benefits of direct marketing to
  customers and companies and the trends fuelling
  its rapid growth.
• Define a customer database and list the four ways
  that companies use databases in direct marketing.
• Identify the major forms of direct marketing.
• Compare the two types of online marketing
  channels and explain the effect of the Internet
  on e-commerce.
• Identify the benefits of online marketing to
  consumers and marketers and the four ways that
  marketers can conduct online marketing.
• Discuss the public policy and ethical issues
  facing direct marketers.

151
What is Direct Marketing?

• Communications with carefully targeted individual
  consumers to obtain an immediate response
• Cultivate relationships
• Often one-to-one interactive
• Precise targeting
• More effective results

152
Forms of Direct Marketing
Figure 17-1
153
Growth of Direct Marketing

• Direct Marketing
• Growing 8 annually vs. 6 for retail sales
• Canadian sales 50B
• 60 growth rate
• Online marketing
• 65 are Internet users
• Canadian sales 2.3B

154
Forms of Direct Marketing
Figure 17-1
155
Chapter 8 ObjectivesProduct Strategies

• Define product and the major classifications of
  products and services.
• Describe the roles of product and service
  branding, packaging, labelling, and product
  support services.
• Explain the decisions companies make when
  developing product lines and mixes.
• Identify the four characteristics of a service.
• Discuss the additional marketing considerations
  that services require.

156

• Marketing is the process
• of helping others value your service.

157
Services are Different
SERVICES
158
Services are Different
Inseparable services cannot be separated from
their providers
SERVICES
159
Services are Different
SERVICES

• Variability
• (Inconsistency)
• quality of services depends
• on who provides them and
• when, where and how

160
Moments of Truth
customers
Front Line Employees
Middle Management
Execs
161
Services are Different
SERVICES
Perishability (Inventory) services cannot be
stored for later sale or use
162
Services are Different
Inseparable services cannot be separated from
their providers
SERVICES

• Variable
• quality of services depends
• on who provides them and
• when, where and how

Perishable services cannot be stored for later
sale or use
163
Service-Profit Chain

• Which is most important?
• customers
• stockholders
• employees

164
Chapter 17 ObjectivesThe Global Marketplace

• Discuss how the international trade system,
  economic, politico-legal, and cultural
  environments affect a companys international
  marketing decisions.
• Describe three key approaches to entering
  international markets.
• Explain how companies adapt their marketing mixes
  for international markets.
• Identify the three major forms of international
  marketing organization.

165
Major Decisions in International Marketing
166
Global Marketing Environment

• International Trade System
• Tariffs
• Quotas
• Embargos
• Exchange controls
• Non-tariff trade barriers

167
Global Marketing Environment

• Economic Environment
• Income distribution
• Industrial structure
• - subsistence economies
• - raw-material exporting economies
• - industrializing economies
• - industrial economies

168
Global Marketing Environment

• Politico-Legal Ethical Environment
• Attitude toward foreign businesses
• Extent of government bureaucracy
• Political stability
• Monetary regulations
• Countertrade
• Compensation
• Counterpurchase

169
Global Marketing Environment

• Cultural Environment
• Language, customs
• Folkways, norms, taboos
• Business norms behaviour
• e.g. Personal distance
• e.g. Meeting and greeting

170
Major Decisions in International Marketing
171
Major Decisions in International Marketing
172
Major Decisions in International Marketing
173
Market Entry Strategies
Exporting Direct Indirect
Joint venturing Licensing Contract
manufacturing Management contracting Joint
ownership
Direct investment Assembly facilities Manufacturi
ng facilities
Amount of commitment, risk, control, and profit
potential
174
Major Decisions in International Marketing
175
International Product Promotion Strategies
Product
Develop new product
Adapt product
Dont change product
Dont Change promotion
Product invention
Straight extension
Product adaptation
Promotion
Communication adaptation
Dual adaptation
Adapt promotion
176
International Product Promotion Strategies
Product
Develop new product
Adapt product
Dont change product
Dont Change promotion
Product invention
Straight extension
Product adaptation
Promotion
Communication adaptation
Dual adaptation
Adapt promotion
177
Major Decisions in International Marketing
178
Global Marketing Organization
Methods of Organizing International Marketing
Operations
Export Department
International Division
Global Organization