Marketing 571 Complete Slide Set Fall 2009

Who the hell are you?

Lets take a Sur vey !
Why do clean restrooms matter?

Why are there 36 varieties of spaghetti sauce?

Who the hell is Larr y ?

He was born here...

*disclaimer: I wasn’t really born here, but there are no good pictures of Rochester, NY

*disclaimer: I did have a home, I wasn’t raised on the streets

Carnegie Mellon University & Tepper School of Business

Went to work and live here...

Management Science Associates (consulting)

Then he went overseas to here...

Then he had his own internet startup

Then he worked in offshore
outsourcing...

Development is
cheaper offshore!

Marketing is cheaper
offshore too!

Hey, wait!

Started a marketing consulting ﬁrm …

The dog, not the beer. Beer is 2nd best friend.

and started teaching at UOP...

That’s who I am.

Who the hell are you?
• How should I address you?

• Where are you from?

• Where do you work?

• What are you great at?

Class Policies

• Miss one class – lose (5) participation points
• Second missed class – auto-drop
• Learning teams, APA format
• Late penalty 10% per day
• Syllabus posted in forums is guiding document

classic air sol’n (wk3)
23
product offering (wk2)
channel & pricing (wk4)
5
5

classic air (wk1)
7 communications (wk5)
10

participation
30
launch plan (wk6)
20

How to identify markets & consumers
How to segment markets
How & why consumers buy
Developing new products
Marketing across channels
How internet marketing works
How to write a marketing plan
How to think like a marketer

discuss
How is marketing management
both an art and a science?

www.surveymonkey.com

1. Register one account per team
2. Develop online survey
3. Post link to survey in LT forum
4. Answer other groups surveys

Topic
Scanning the
Macro Environment

Social Economic Technology Competitive Regulatory

interact
describe your business in
one sentence

Topic
marketing
myopia

“ Define your business
by customer needs,
not products
“

TV
DVD

We provide Web

entertainment Games

We make movies

• What do you want to know?
• Who do you ask?

“Eight Arms to Hold You”

“Spaceman From Pluto”

“Would I lie to You?”

“3000”

Research: The 5 Steps

Problem Research Data Present Take
Deﬁnition Plan Collection Findings Action

discuss
Can you think of a
product with negative
demand?

discuss
Why are the production concept, the
product concept, and the selling
concept of limited use for the
conduct of business operations today?

What can I use at work tomorrow?

Twitter for research
Twistori
Visible Tweets

quote
“ I have only made this letter
longer because I have not had
the time to make it shorter “

Blaise Pascal, (1623-1662) Lettres provinciales.

interact
research crowdsourcing
post to @mba570+message

discuss
Good? Bad?
good and bad?

Topic
Creating compelling
presentations

debate
Does Marketing Create Needs
or Satisfy Needs?

Quiz
10
1
2
3
4
5
6
7
8
9
Which one is not part of the 4Pʼs marketing mix
model?

A: Promotion B: Price

C: Publicity D: Place

Quiz

C: Publicity

Product is the fourth P

Publicity is considered to be a
component of promotion

Administrative Issues

• Week 1 paper grading
• Week 5 ﬁeld trip
• Questions?

“There is no perfect pickle”

The Consumer Decision Process

Post-
Problem Information Alternative Purchase
purchase
Recognition Search Evaluation Decision
Behavior

Post-
purchase
Behavior

“I want a car, but I
have no money”

Post-
purchase
Behavior

How to steal a car

Post-
purchase
Behavior

Secondar y
Internet
Research

Topic
The rational
Consumer

Topic
Different Views
on choice

discuss
Different Views
on choice

Topic
market
segmentation

How do we service customers with
varied needs?

Race

(who the hell is this?)

Segmentation
• Consumer segmentation
• Demographics, psychographics, behavioral
• Beneﬁts segmentation & needs-based
segmentation
• Business segmentation
• Company size, industry, geography
• Proﬁtability of segments: 80 – 20 rule

Desktop Portable

Business

Power Mac G5 PowerBook

Home

iMac iBook

interact
Create market segments for your company in groups

Illustrate segments on board

Topic
Perceptual
mapping

Perceptual Mapping?

Start with consumers
companies
products classy

Position on x-y graph

conservative sporty

practical

Try other dimensions

wasteful

small large

fuel efﬁcient

Try other dimensions

Single

Youth Mature

Family

interact
Create perceptual map for Classic Airlines

Topic
Presentation skills
workshop (part I)

interact
Draw a stick figure on the white board

interact
Experience
Twitter

interact
is this useful?
(tweet your answer)

Welcome

Marketing 571, Class 3
October / November 2009
Lawrence Linn

Housekeeping

• Week 2 assignment grading
• Presentation & other materials
• Next week assignment option

http://mkt571.lawrencelinn.com/

Presentation Option Guidelines

• 5 - 10 minutes maximum length
• Cover same material as paper
• Not all group members need to present
• Submit powerpoint slides

Remember
consumers
are not
always
rational

HOW TO BRIDGE
THE DISTANCE
BETWEEN
BUSINESS STRATEGY
AND DESIGN

Topic
Word of mouth, social media &
remarkable marketing

video
Fabrege’ Organic Shampoo Ad, 1975

video
FOX News: Take Back the Beep, 8.16.2009

video
Seth Godin on standing out, TED Conference, July 2007

Topic
New Product Development

How Do New Products Get Developed?

• Flash of Innovation
• Structured development
• Customer research

quote
The radio craze will die out in time
- Thomas Edison

Video won’t be around more than 6
months; people will soon get tired of
staring at a plywood box
- president of 20th century fox, 1946

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interact
New frontiers in product development

Topic
How do you price products?

interact
•
•
•
Research your group, then others (10 min)
Data dump to twitter – @mba570
One person per group wiki organizer
• http://start.email.phoenix.edu/
• login with upx ID
• go to more -> sites -> looking for...
• mkt571 research roundtable

Marketing 571

Chapter one

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ipsum. Cum dis nam, rhoncus ut curabitur arcu integer eget, erat
consumers have varied tastes
tempus vel nonummy amet curabitur. Phasellus felis ridiculus
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venenatis, arcu ultrices. Suspendisse elementum pretium odio.

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ultricies risus adipiscing morbi, proin vestibulum aliquam sociis
blandit donec cras, mus quam suspendisse in quis.

Penatibus dolor platea, nunc sit auctor mauris, a bibendum
rutrum orci non sit volutpat, sit placerat nulla arcu turpis nostra
arcu. Libero sed sit myopia
marketing mollis blandit. Faucibus dolor vel sapien
sagittis pellentesque fermentum, a amet Malcolm Gladwell

1 2

Marketing 571

Chapter two

“The rational consumer*”
donec, a , erat et vivamus acurpis, erat et vivamus ac neque dis
cras. consumer decision process
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the reptile brain
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arcu ultrices. Suspendisse elementum pretium odio.


irrational consumers
rutrum orci non sit volutpat, sit p

Clotaire Rapaille

13 14

Marketing 571

Chapter three

“Remarkable marketing”
cras. speak to who’s listeningridiculus elit dolor quis
Phasellus est mollis distinctio,
the “otaku”


Penatibussegmentation
dolor platea, nunc sit auctor mauris, a bibendum

Seth Godin

25 26

Marketing 571

Chapter four

“Channel your efforts”
Lorem ipsum dolor sitchannels
marketing amet, magnis a metus quibusdam dui
arcu ultrices. Suspendisse elementumthe long tail
pretium odio.


merchandising

Chris Anderson

38 39

pany’s recycling center in California.9

FIGURE 13.3 Consumer and Industrial Marketing Channels

(a) Consumer marketing channels (b) Industrial marketing channels

0-level 1-level 2-level 3-level 0-level 1-level 2-level 3-level

Manufacturer Manufacturer Manufacturer Manufacturer Manufacturer Manufacturer Manufacturer Manufacturer

Manufacturer's Manufacturer's
Wholesaler Wholesaler
representative sales branch

Jobber

Industrial
Retailer Retailer Retailer
distributors

Industrial Industrial Industrial Industrial
Consumer Consumer Consumer Consumer customer customer customer customer

248 Part V Delivering Value

FIGURE 13.4 The Value-Adds Versus Costs of Different Channels

High

Sales force

Value-added
partners
Value-Add of Sale

Direct sales
Distributors channels

Retail stores

Telemarketing "Indirect" channels

Internet
Direct marketing
channels
Low
Low High
Cost per Transaction

Source: Oxford Associates, adapted from Dr. Rowland T. Moriarty, Cubex Corp.

CHANNEL-MANAGEMENT DECISIONS

MARKETING INSIGHT GLOBAL STANDARDIZATION OR ADAPTATION?

The marketing concept holds that consumer needs vary and that following elements and determine which would add more revenue
marketing programs will be more effective when they are tailored to than cost:
each target group. This also applies to foreign markets. Yet in 1983,
in a groundbreaking article in the Harvard Business Review, Harvard
I Product features
Professor Theodore Levitt challenged this view and supplied the intel- I Brand name
lectual rationale for global standardization: “The world is becoming a I Labeling
common marketplace in which people—no matter where they live— I Packaging
desire the same products and lifestyles.”
The development of the Web, the rapid spread of cable and satel- I Colors
lite TV around the world, and the global linking of telecommunications I Advertising execution
networks have led to a convergence of lifestyles. The convergence of I Materials
needs and wants has created global markets for standardized prod-
I Prices
ucts, particularly among the young middle class.
Levitt favors global corporations that try to sell the same product I Sales promotion
the same way to all consumers. They focus on similarities across I Advertising themes
world markets and “sensibly force suitably standardized products and I Advertising media
services on the entire globe.” These global marketers achieve
economies through standardization of production, distribution, mar- Consumer behavior can dramatically differ across markets. Take
keting, and management. They translate their efficiency into greater annual beverage consumption. One of the highest per capita con-
value for consumers by offering high-quality and more reliable prod- sumers of carbonated soft drinks is the United States, with 203.9
ucts at lower prices. liters per capita consumption; Italy is among the lowest. But Italy is
Coca-Cola, McDonald’s, Marlboro, Nike, the NBA, and Gillette are one of the highest per capita drinkers of bottled water with 164.4
among the companies that have successfully marketed global prod- liters, whereas the United Kingdom is only 20 liters. When it comes to
ucts. Consider Gillette: Some 1.2 billion people use at least one beer, Ireland and the Czech Republic lead the pack, with over 150
Gillette product daily, according to the company’s estimates. Gillette liters per capita, with France among the lowest at 35.9 liters.
enjoys huge economies of scale by selling a few types of razor blades Besides demand-side differences, other types of supply-side dif-
in every single market. ferences can also prevail. Levitt’s critics pointed out that flexible
Many companies have tried to launch their version of a world manufacturing techniques made it easier to produce many different
product. Yet, most products require some adaptation. Toyota’s Corolla product versions, tailored to particular countries. One study showed
will exhibit some differences in styling. McDonald’s offers a ham and that companies made one or more marketing-mix adaptations in 80
cheese “Croque McDo” in France, a variation of the French favorite percent of their foreign products and that the average number of
croque monsieur. Coca-Cola is sweeter or less carbonated in certain adapted elements was four. So perhaps Levitt’s globalization dictum
countries. Rather than assuming that its domestic product can be should be rephrased. Global marketing, yes; global standardization,
introduced “as is” in another country, the company should review the not necessarily.

Sources: Theodore Levitt, “The Globalization of Markets,” Harvard Business Review (May–June 1983): 92–102; Bernard Wysocki Jr., “The Global Mall: In
Developing Nations, Many Youths Splurge, Mainly on U.S. Goods,” Wall Street Journal, June 26, 1997, p. A1; “What Makes a Company Great?” Fortune,
October 26, 1998, pp. 218–226; David M. Szymanski, Sundar G. Bharadwaj, and P. Rajan Varadarajan, “Standardization versus Adaptation of International
Marketing Strategy: An Empirical Investigation,” Journal of Marketing (October 1993): 1–17; “Burgers and Fries a la Francaise,” The Economist, April 17,
2004, pp. 60–61; Johny K. Johansson, “Global Marketing: Research on Foreign Entry, Local Marketing, Global Management,” in Handbook of Marketing,
edited by Bart Weitz and Robin Wensley (London: Sage Publications, 2002), pp. 457–483.

D I S I N T E R M E D I AT I O N

Manufacturer $100

Importer $105

Wholesaler $115

Retailer $160

Consumer
Consumer $110 $200

30ft

6ft

Ryukyu Long Tailed Giant Rat (Diplothrix legatus)

tops

Local Book Stores
Sales

Bestsellers Custom

Distribution
cost
Sales

Bestsellers Custom

80% 20%

17M 15M

Marketing 571

Chapter one

donec, a porttitor vestibulum turpis, erat et vivamus ac neque dis
tellus et, in pede, mauris magna porttitor ullamcorper, odit
venenatis, arcu ultrices. Suspendisse elementum pretium odio.


rutrum orci non sit volutpat, sit placerat nulla arcu turpis nostra
arcu. Libero sed sit mollis blandit. Faucibus dolor vel sapien
sagittis pellentesque fermentum, a amet Malcolm Gladwell

1 2

Marketing 571

Chapter two

“The reptile brain”



Clotaire Rapaille

13 14

Marketing 571

Chapter three

“Be Remarkable”



Seth Godin

25 26

Marketing 571

Chapter four

“The Long Tail”
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marketing amet, magnis a metus quibusdam dui
disintermediation
arcu ultrices. Suspendisse elementumthe long tail
pretium odio.


merchandising

Chris Anderson

38 39

Marketing 571

Chapter five

“Advertising is wasteful”
advertising
integrated marketing

ethics in marketing

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auctor mauris, hints

John Wanamaker

38 39

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Who was this commercial
aimed at?

Multichannel marketing
integrated marketing communications

What are marketing channels?

direct mail
mobile
email
radio
web
TV

Chapter 15 Designing and Managing Integrated Marketing Communications 281

TABLE 15.1 Common Communication Platforms

Events/ Personal Direct
Advertising Sales Promotion Experiences Public Relations Selling Marketing
Print and broadcast ads Contests, games, Sports Press kits Sales Catalogs
sweepstakes, lotteries presentations
Packaging—outer Entertainment Speeches Sales meetings Mailings
Packaging—inserts Premiums and gifts Festivals Seminars Incentive Telemarketing
programs
Motion pictures Sampling Arts Annual reports Samples Electronic
shopping
Brochures and booklets Fairs and trade shows Causes Charitable Fairs and TV shopping
donations trade shows
Posters and leaflets Exhibits Factory tours Publications Fax mail
Directories Demonstrations Company Community relations E-mail
museums
Reprints of ads Coupons Street activities Lobbying Voice mail
Billboards Rebates Identity media
Display signs Low-interest Company magazine
financing
Point-of-purchase Entertainment
displays
Audiovisual material Trade-in allowances
Symbols and logos Continuity programs
Videotapes Tie-ins

media. Four represent major communication functions—encoding, decoding, response, and

data
$1,050

$730

$502 $520

$194 $242
$121

web
store
catalog
catalog+internet
internet+retail
catalog+retail
catalog+retail + internet

Share of Ad Spending

Local TV
Internet
14.8%
5.9%
4.5% 2.5% Network TV
National Magazines
17.1% Cable TV
2.4% National Magazines
Local TV
7.2% Internet
Local Newspapers
Hispanic TV
Cable TV Syndicated TV
22.7% Network TV Other
22.8%

source: Nielsen Online, AdAcross, Marketingcharts.com

video
Cereal Marketing, ABC News, October 2009

leads to
Ad Spending Sales

warning: slide may contain instructor bias

More Tips

• Look at online materials forum
• Slides support speakers
• Have hip-pocket slides
• Be prepared
• Use pictures, not clip art - www.compﬁght.com
• Have fun, create a story arc

This is an ugly slide

• Look at online materials forum
• Slides support speakers
• Have hip-pocket slides
• Be prepared
• Use pictures, not clip art - www.compﬁght.com
• Have fun, create a story arc

Marketing 571

Chapter four

“The Long Tail”



Chris Anderson

38 39

Marketing 571

Chapter five

“Advertising is wasteful”



John Wanamaker

49 50

Marketing 571

Chapter six

“Mmmm….Donuts”
cras. Phasellus relations
public est mollis distinctio, ridiculus elit dolor quis

ethics


Homer Simpson

60 61

How to get free advertising with a doughnut

Marketing 571 Complete Slide Set Fall 2009

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Marketing 571 Complete Slide Set Fall 2009