MRKTNG 3000 1st Edition Exam 1 Study Guide Lectures 2 5 Chapters 1 5 Lecture 2 August 21 Marketing Context and Overview What is marketing o The process of planning and executing the conception pricing promotion and distribution of ideas goods and services to create exchanges that satisfy individual and organizational objectives Marketing study of exchange The purpose of the marketing concept is to rivet the attention of marketing managers on serving broad classes of customer needs customer orientation rather than on the firm s current products production orientation or on devising methods to attract customers to current products selling orientation Principles of Marketing CH 1 Tasks of Marketing o First Task Discovering Consumer Needs Find potential consumers the market and information about needs Create concepts for products o Second Task Satisfying consumer Needs Find the right combination of the four P s Product Price Promotion Place o Product is generally most important of the 4 P s Benefits and Costs Categories o Benefits Functional Ex pen chair lawnmower hammer o Functional benefit of taking MRKTNG 3000 Learn about marketing get course credit Social Ex clubs bars social media cellphones o Social benefit of taking MRKTNG 3000 Meet friends business partners etc Experiential Ex sports traveling o Experiential benefit of taking MRKTNG 3000 Have fun joy of learning Personal Ex game winning hit make up a house o Personal benefit of taking MRKTNG 3000 Feeling good about learning or excelling o What is an example of a product that has all types of benefits associated with it A football game This class o Costs Monetary spent o Ex tuition and book fees Temporal Time spent o Ex time spent in class and studying Psychological Psychological costs o Ex stress of studying and listening to professors Behavioral Cost of behavioral activity o Ex expending energy walking to classes o iPad Discussion Benefits of iPad Experiential easy to use apps o Added benefits more colors Costs of iPad Monetary cost more Lecture 3 August 26 Marketing Strategy and Competitive Analysis Analyzing the Marketing Environment o 40 billion diet industry o Increased consumption of health and diet products o Businesses responding to the demand in a variety of ways Megatrend past 20 years Ex Subway Kashi o Trends seen during the recession Movies alcohol cigarettes dollar stores Three Phases of a Strategic Marketing Plan o Step one Defining the Mission and or Vision MADD Mission Statement The mission of MADD is to stop drunk driving support the victims of this violent crime and prevent underage drinking Porter s Five Forces Model Corporate Strategy o In which industries do we want to compete Industry profitability dependent on o Industry competiveness Intensity of current competitors Low intensity monopoly higher profitability o Ex Commercial aircraf More firms more intensity lower profitability o Ex Fast food o Availability of substitute products Few or no substitutes higher profitability Ex gasoline proprietary drugs Many substitutes lower profitability Ex fresh vegetables technological products sof drinks o Coke is NOT a substitute for pepsi Water is a substitute for pepsi Prospect of a future technology can act as a substitute Ex Blu ray new product coming out o Potential entrants threat of new competition High Barriers to entry lower competitive threat higher profitability High barriers exist when High capital requirements Economies of scale are present High product differentiation Network externalities technological or learning curve Ex automobile industry high capital requirements economies of scale Ex of network barrier word processing sofware network externalities No barrier to entry unless you create on using network externalities o Supplier and buyer power Lower bargaining power of suppliers buyers higher profitability Lower bargaining power when o High number o Low information Ex low supplier power computer industry hard disk drives Ex low buyer power medical services patients Which industries will be profitable now and profitable in the future o What is Sustainable Competitive Advantage An advantage versus competition that can be maintained consistency overtime What do you think are the keys to McDonald s sustainable advantage o In India no burgers o In France make your own dessert o Macro Strategies for Developing Customer Value Product excellence Apple Operational excellence Customer excellence Virgin Atlantic 3 tiers of service Ritz Karlton o Step two Conduct a Situation Analysis Using SWOT Intensive growth strategies Ansoff s Product Market Expansion Grid How to increase sales o Lower prices o Location o Increase Promotion o Increase distribution Ex Product development Nature Valley new sweet and salty bars Hypothetical Market Structure Strategies Beer o Market Leader 40 Busch Expand Market promote beer in general Defend Market Share Expand Market Share o Market Challenger 30 Miller Coors Attack Leader Status Quo o Market Follower 20 Sam Adams Imitate o Market Nicher 10 Boulevard Specialize Apple Inc o Firm s main type of growth strategy Product development o Firm s main type of macro strategy Product excellence o Which of the five forces most limits profitability of the tablet industry Availability of substitutes Chapter 1 Strategic Planning and the Marketing Management Process The Strategic Planning Process o What is Strategic Planning Includes all the activities that lead to the development of a clear organizational mission organizational objectives and appropriate strategies to achieve the objectives for the entire organization o 4 components of a strategic plan Mission The mission statement or purpose of an organization is the description of its reason for existence Defines the direction in which the organization is heading and how it will succeed in reaching its desired goal What is our business Who is the customer What do customers value What will our business be 3 key elements in developing a mission statement o The organization s history o The organization s distinctive competencies What does the company do best o The organization s environment Dictates the opportunities constraints and threats that must be identified When completed an effective mission statement will be focused on markets rather than products achievable motivating and specific Principles of Marketing o External rather than internal focus Objectives Organizational objectives are the end points of an organization s mission and