Marketing in Today's Economy

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Marketing in Todays Economy
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C H A P T E R
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The Challenges and OpportunitiesOf Marketing in
Todays Economy

• Power Shift to Customers
• Massive Increase in Product Selection
• Audience and Media Fragmentation
• Changing Value Propositions
• Shifting Demand Patterns
• New Sources of Competitive Advantage
• Privacy, Security, and Ethical Concerns
• Unclear Legal Jurisdiction

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U.S. Households by Internet Access
Exhibit 1.1
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The Childrens Online Privacy Protection Act
(COPPA)
Exhibit 1.2
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Discussion Question

• Increasing customer power is a challenge to
  marketers in todays economy. In what ways have
  you personally experienced this shift in power
  either as a customer or as a business person? Is
  this power shift uniform across industries and
  markets? How so?

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Basic Marketing Concepts

• Marketing (AMA 2005 definition)
• 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.
• Market
• A collection of buyers and sellers

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Basic Marketing Concepts

• Marketspace
• Electronic marketplaces that are not bound by
  time or space
• Metamarket
• A cluster of closely related goods and services
  that center around a specific consumption
  activity
• Metamediary
• Provides a single access point where buyers can
  locate and contact many different sellers in the
  metamarket

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Example Metamediary
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Common Metamarkets and Participants
Exhibit 1.3
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What is Exchange?

• Exchange
• Process of obtaining something of value by
  offering something in return
• Five Conditions of Exchange
• There must be at least two parties to the
  exchange.
• Each party has something of value to the other
  party.
• Each party must be capable of communication and
  delivery.
• Each party must be free to accept or reject the
  exchange.
• Each party believes it is desirable to exchange
  with the other party.

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What is a Product?

• Product
• Something that can be acquired via exchange to
  satisfy a need or a want
• Examples
• Goods
• Services
• Ideas
• Information
• Digital Products

• People
• Places
• Experiences and Events
• Real or Financial Property
• Organizations

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The Concept of Utility

• Utility
• Ability of a product to satisfy a customers
  desires
• Five Types of Utility
• Form Utility
• Time Utility
• Place Utility
• Possession Utility
• Psychological Utility

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Major Marketing Activities and Decisions (1 of 5)

• Strategic Planning
• Strategy
• Tactical Planning
• Marketing Plan
• Social Responsibility and Ethics
• Social Responsibility
• Marketing Ethics

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Discussion Question

• How concerned are you about privacy and security
  in todays economy? Are you more concerned about
  online security or about the potential
  ramifications of RFID technology? Will these
  issues still be important in 10 years? Explain.

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Major Marketing Activities and Decisions (2 of 5)

• Research and Analysis
• Internal Analysis
• Competitive Intelligence
• Environmental Scanning
• Situation Analysis
• Developing Competitive Advantage
• Competitive Advantage
• SWOT Analysis

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Major Marketing Activities and Decisions (3 of 5)

• Marketing Strategy Decisions
• Market Segmentation and Target Marketing
• Product Decisions
• Product Positioning
• Pricing Decisions
• Leads to revenue and profit
• Directly connected to customer demand
• Easy to change
• Major quality cue for customers

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Online Social Networking

• Social networking sites like MySpace.com,
  LinkedIn.com, and Facebook.com have been
  criticized for questionable content and easy
  access to predators.
• How can advertisers balance the opportunities
  presented by these sites with the risk?

Beyond the Pages 1.2
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Major Marketing Activities and Decisions (4 of 5)

• Marketing Strategy Decisions (continued)
• Distribution and Supply Chain Decisions
• Distribution and Supply Chain Management
• Supply Chain Effectiveness
• Promotion Decisions
• Integrated Marketing Communications (IMC)

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Major Marketing Activities and Decisions (5 of 5)

• Implementation and Control
• Marketing Implementation
• Developing and Maintaining Customer Relationships
• Transactional Marketing
• Relationship Marketing

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Major Characteristics of Transactional and
Relationship Marketing
Exhibit 1.4
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Corporate Culture Matters
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Taking on the Challenges ofDeveloping Marketing
Strategy (1 of 2)

• Unending Change
• People-Driven Nature of Marketing
• Lack of Rules for Choosing Marketing Activities
• Basic Evolution of Marketing Business Practice
• Increasing Demands of Customers
• Overall Decline in Brand Loyalty Increase in
  Price Sensitivity

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Discussion Question

• The text argues that marketing possesses very few
  rules for choosing the appropriate marketing
  activities. Can you describe any universal rules
  of marketing that might be applied to most
  products, markets, customers, and situations?

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Taking on the Challenges ofDeveloping Marketing
Strategy (2 of 2)

• Competing in Mature Markets
• Increasing commoditization
• Little real differentiation among product
  offerings
• Increasing Expansion into Foreign Markets
• Aggressive Cost-Cutting Measures
• Increasing Cooperation with Supply Chain Partners
  and Competitors

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American Customer Satisfaction Index
Exhibit 1.5
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Marketing Strategy in Action

• Increasing expansion into foreign markets is
  becoming a necessity to compete in the global
  marketplace.
• What kind of opportunities and threats are
  presented by the increasing global nature of the
  marketplace?