Basic BackgroundSlide 2Slide 3Introduction / Formal LectureSlide 5MKTGSlide 7Slide 8Target market:Slide 10Slide 11Consumer Behavior:Slide 13Cognitive dissonanceSlide 15Slide 16Slide 17Slide 18Slide 19Slide 20Slide 21Slide 22Chars. of ind. buy:Types of buysIndustrial mktg. mix:Mfr’s rep. ‘agent’Slide 27Slide 28Slide 29Political & Legal Envt.Legislators are largely ‘lawyers’Slide 32Slide 33Slide 34Where Marketing fits into the OrganizationSlide 36Slide 37Slide 38Slide 39Market SegmentationSlide 41Slide 42Slide 43Target MarketSlide 45Market ResearchSlide 47Slide 48Slide 49Basic BackgroundI. MKTG is “people driven” (responds to needs of buyer)II. Varying backgrounds for mktg. personnelIII. Mktg. interfaces with other areas of the firm finance “pricing”acctg.Order entrypricinginventory control*Synergyproductive interactionControlProductionInfo.CreativeEng.MKTG.data control MISproduct flow,invty. control,delivery tracking,performancemeasurementSYNERGYMgmt. Sales people:hiring, training,compensationPublic rltns.audience profilingimage evaluationIV. Role of courseIntroduction / Formal LectureI. Conceptual Reason for MKTG A. Three economic utilities marketing provides: time utilityplace utility ownership utility B. Mktg. concept If: 1. identify a buyer’s need, 2. dvp. product to satisfy need over long run, 3. ensuring profitability MKTGII. Defn. of mktg: development and distribution of products for chosen market segments.MKTGDevelopment &Distributionof products (goods and services)to chosen market segmentsgroup of buyers (buying units)who share certain characteristicsIII. Development of Mktg. (4 stages) A. production orientationB. Sales orientationC. consumer focusD. Societal orientation A company may be in any of the four stages.IV. MKTG mix 4 elements: Product, Price, Promotion, Place (distribution)Controllableby companyB. Marketing mix: combination of 4 elements that a firm presents to a target market . Target market: group of buyers for whom firm develops a marketing mix.‘SPANGLES’Females 27 - 32 22 - 26 18 - 21 14 - 17$0 - 5k $6 -18 $19 - 25 $26 - 35 Income ($k)AgeXXXXXXXTarget market:Made up of buyers who share some characteristic(s)Market segment:Group of buyers for whom we develop a marketing mix4 mkt. segmentsABCDtgt. mkt.‘SPANGLES’Females 18 - 21 14 - 17 $0 - 5k $6 -18 IncomeAgeBench marks:mkt. sizemkt. shrrevenueprofitabilityProductPriceProm.DistTarget marketmarket researchmarket developmentmarketing organizationConsumer Behavior:A. “What it is” (definition)B. Why do we need to understand?C. Sources of knowledge:Psychology (individuals),Sociology (groups),Education (learning),Economics (supply and demand),Individual insight. *D. A cognitive model of consumer behaviorIncomingStimulicuesads.5%Perceptualsystem (screen) target’s needs & wantssearch process response(purchase or postpone)reenforcement+ / -estab prod.as “want” for a needdrive statecues (info.)(very short to very long)CognitivedissonanceCognitive dissonanceentails post-decision uncertainty.‘ + ‘ Positive (reinforces decision)‘ - ‘ Negative (contradicts decision)E. Purchase = function of (personal factors & envtl. factors)F. Buyer behavior is learned Cue Response ReenforcementDriveG. Factors in model: perception (your perceptual system) the way someone selects, organizes, and interprets information.See Can Buy Diet Coke Achieve reinforcementLearned behavior: You see someone drinking a canned drink‘Need’ (lack of something useful)‘Want’ (way you satisfy need)e.g., nourishmentchickfryfriedchickenfriedcatfishLunch: Mon. Tues. Wed. Thu. Fri.‘salad’ dayfriedocreSelect (5 %),organize (store, relate),and interpret information.Perception:2. attitude: defined 3. psychographics (lifestyle)4. social factors “poverty of time”5. culture/ subculture6. social class:A. old rich new richB. young professional blue collar starC. lower class: branded convenience itemsPsychographics or lifestyle:combinations of activities, interests, and opinions those in a target market practice, aspire to, or identify with.Industrial Buyer BehaviorI. Industrial mktg. defined:II. Buyer behaviorA. chars of industrial buy (4)B. Who buys?C. Types of buys (3)III. Industrial mktg. mixChars. of ind. buy:1). multiple buyers (buying committee) or centralized buyer2). product specs.3). formalized paperflow (P.O. System) 4). bid systemapprovedvendormaterials managerTypes of buys1). direct purchase: 2/10, net 602). lease3). “reciprocity” (questionable practice)2/10,Industrial mktg. mix:A. Product: is hard to identify (benefit sought)B. Price: may differ (vary) base upon qty., payment scheme, freight terms, maintenance or promotional agreementC. Promotion: salespeople are impt. advertising is focusedD. Distribution: extensive use of wholesalers/ distributors trade jnls.trade showsdistribution channelMfr’s rep. ‘agent’(independent salesperson who works on contract) Principal Corp. Mfr’s.Rep.lg. retail chains who mkt. own prods.(True Val; Piggly Wiggly)Ashland Chem.DistributorsWal-mart300, CS.RepairShopsCar Dlr..Auto PartsStorsLeaseCo.HeadqtrsAcct. Rep.DualDistributionTrade show:$7,000 300 $23Overall cost to companyProspects seenCost per prospectMarketing environmentPoliticalforcesLegal and regulatoryforcesSocietalforcesBuyerProductPromotionPriceDistributionTechnologicalforcesEconomic forcesConsumer movementforcesMarketing environmentinfluencePolitical & Legal Envt.I. Aspects of mktg envt:A. Content:Social envt.Legal envt.Competitive envt.Technological envt.B. Envt. is largely uncontrollableII. Political / Envt.A. Politics & laws closely related (3 reason)B. Political / legal envt. partially controllable (2)III. Legal Envt.A. types of laws: (3)‘INFLUENCE’‘INFLUENCE’Legislators are largely‘lawyers’Judges are mostly‘lawyers’People who litigate we call“lawyers”2. Consumer protection laws3. Societal protection laws1. Pro-competitive or anti-trust lawsB. Key Federal laws1. Sherman Act (1890)made illegal “contracts, combinations, or conspiracies monopolies or attempts to monopolize”in restraint of trade...TOO BROADInterstate commerceFederalstate2. Robinson- Patman Act (1936)a. addresses price
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