Exam 1 Prep Tuesday February 16 2016 11 01 PM Market Segmentation The Marketing Process 5 step Dividing a market into distinct groups of buyers who have different needs characteristics or behaviors and who might require separate products or marketing programs marketing concept Understand the marketplace and customer needs and wants Design customer driven marketing strategy Construct integrated marketing program that delivers superior Build profitable relationship and create customer delight Capture value from customers to create profits and customer 1 2 3 4 5 value equity Marketing Exchange Marketing occurs when people decide to satisfy their needs and wants through an EXCHANGE relationship Exchange the act of obtaining a desired object from someone by offering something in return Marketing Consists of creating maintaining and growing desirable exchange relationships with target audiences Marketing Myopia Paying more attention to the specific products a company offers than to the benefits and experiences produced by these products Focusing too much on customer existing WANTS and not underlying NEEDS Production Concept Customers choose highly available and affordable products ex Busch Lite beer Product Concept Customers favor high quality products with the most features and best performance Ex iPad super expensive Gen X usually wants to buy these Selling Concept Customers will not buy products unless the firm undertakes large selling and marketing efforts Adverts Marketing Concept The company must understand market NEEDS WANTS then delivering customer satisfaction better than the competition Societal Marketing Concept Marketing decision include consumer and company requirements but also consumer and SUSTAINABLE clean energy societal long term interests Customer Relationship Management CRM Delivering superior customer value and satisfaction to build and maintain profitable customer relationships Customer Perceived Value Customer s evaluation of the difference between all the benefits and costs of a marketing offer relative to those of competing offers Customers do NOT judge values and cost accurately or objectively they ACT on perceived value Customer Satisfaction Extent to which a product s perceived performance matches a buyer s expectations High satisfaction high loyalty Companies under promise and over deliver Ex JetBlue You above all 4 P s of Marketing Mix Turns marketing strategy into customer value in the exchange relationship 1 Product 2 Price 3 Place 4 Promotion Product Target Customers Price Target Customers Place Target Customers Promotion Intended positioning The Boston Consulting Group BCG Growth Share Matrix The goods and services combination the company offers to the target market Amount of money customers must pay to obtain the product The company activities that make the product available to target consumers Activities that communicate the merits of the product and persuade target customers to buy it Tries to identify the business nature of a company Star High growth share investment Low share High investment growth market Cash Cow Low growth high share less investment fund other priorities Dog Low growth low share low return Market Segment Group of consumers who respond in a similar way to a given set of marketing efforts Ex Luxury car vs cheaper reliable car Market Targeting Evaluating each market segment s attractiveness and selecting one or more segments to enter SWOT Analysis Definition Steps in Strategic Planning A company should target segments in which it can profitably generate the greatest customer value and sustain it over time SWOT is a situational analysis and is a key part of a comprehensive marketing plan The 4 P s segmentation and target market strategy and a business mission statement 1 2 3 4 Defining the company mission Setting company objectives and goals Designing the business portfolio Planning marketing and other functional strategies Marketing Plan Marketing planning involves choosing marketing strategies that will help the company attain its overall strategic objectives The plan begins with an executive summary that quickly reviews major assessments goals and recommendations The main section of the plan presents a detailed SWOT analysis of the current marketing situation as well as potential threats and opportunities The plan next states major objectives for the brand and outlines the specifics of a marketing strategy for achieving them Marketing Plans Cannot control the external environment so focus on elements in the company s control Differentiation Marketing Environment Effective positioning begins with differentiation Differentiating the market offering to create superior customer value Outside forces that affect marketing management s ability to build and maintain successful relationships with target customers Microenvironment and Macro environment Microenvironment Actors close to the company that affects its ability to serve its customers Actors in Microenvironments Customers Most important Consumer markets business markets reseller markets international markets Suppliers Provide needed resources to produce goods and services Marketing Intermediaries Help promote sell and distribute products to final buyers Competitors Marketers must gain strategic advantage by positioning their offerings strongly against competitors offerings in minds of consumers Public Any group that has actual or potential interest in or impact on ability to achieve company objectives Macroenvironment Larger societal forces that affect the microenvironment and the company s ability to serve its customers Baby Boomers Affluent large aging 25 US population Generation X High quality products first to embrace tech family first research products prove it to me Millennials Gen Y Debt Large 83 Mill Highest employment tech comfort Generation Z Spend own and parent money kids and teens fluent in tech Assessing Marketing Information Needs A good MIS balances info what they need and what is feasible to offer Obtaining analyzing storing and delivering info is EXPENSIVE Decide whether value of insights gained from more info is worth cost Marketing Information Systems MIS 1 2 3 4 Info users are marketing managers internal and external partners Marketers start by assessing user info needs Develop the needed info using internal company databases marketing intelligence activities and marketing research processes MIS helps the users to analyze and use the info to develop