Unlock document.
This document is partially blurred.
Unlock all pages and 1 million more documents.
Get Access
Use Marketing at Work 2.2 here.
Market Targeting
Market targeting involves evaluating each market segment’s attractiveness and selecting one
or more segments to enter.
A company with limited resources might serve only a few “market niches.”
Market niches are segments that major competitors overlook or ignore.
Most companies enter a new market by serving a single segment. If this proves successful, they
add segments.
Market Differentiation and Positioning
Product position is the place the product occupies relative to competitors in consumers’ minds.
Positioning is arranging for a product to occupy a clear, distinctive, and desirable place relative
to competing products in the minds of target consumers.
Positioning begins with differentiation—differentiating the company’s market offering so that
it gives consumers more value.
Use Discussion Question 2-3 here
Developing an Integrated Marketing Mix
Use Key Term Marketing Mix here.
Use Figure 2.5 here.
Use Discussion Question 2-4 here.
The marketing mix is the set of controllable, tactical marketing tools that the firm blends to
produce the response it wants in the target market.
The marketing mix consists of the “four Ps”: product, price, place, and promotion. (Figure 2.5)
Product: the goods-and-services combination the company offers to the target market.
Price: the amount of money customers have to pay to obtain the product.
Place: the company activities that make the product available to target consumers.
Promotion: the activities that communicate the merits of the product.
From the buyer’s viewpoint, the four Ps might be better described as the four As:
Product = Acceptability
Price = Affordability
Place = Accessibility
Promotion = Awareness
Acceptability: extent to which the product exceeds customer expectations
Affordability: extent to which customers are willing and able to pay the product’s price
Accessibility: extent to which customers can readily acquire the product
Awareness: extent to which customers are informed.
MANAGING THE MARKETING EFFORT
Managing the marketing process requires the four marketing management functions of analysis,
planning, implementation, and control.
Use Figure 2.6 here.
Marketing Analysis
Analysis should be performed to understand the markets and marketing environment the
company faces.
Use Key Term SWOT Analysis here.
SWOT analysis is used to evaluate the company’s strengths (S), weaknesses (W), opportunities
(O), and threats (T).
Strengths include capabilities, resources, and positive situational factors.
Weaknesses include negative internal factors and negative situational factors.
Opportunities are favorable external factors.
Threats are unfavorable external factors.
Use Figure 2.7 here.
Use Critical Thinking Exercise 2-6 here.
Marketing Planning
A detailed marketing plan has to be developed for each business, product, or brand.
Table 2.2 shows the major sections of a marketing plan for a product or a brand.
Use Table 2.2 here.
Use Chapter Objective 5 here.
Marketing Implementation
Marketing implementation turns plans into actions.
Use Key Term Marketing Implementation here.
Implementation addresses the who, where, when, and how.
Marketing Department Organization
The marketing organization must be designed so it can carry out the strategies/plans that are
developed.
In small companies, one person may perform all the marketing functions. In large companies,
many specialists are found. Many companies have now created the Chief Marketing Officer
(CMO) position.
The functional organization is the most common form. This organizational form has the different
activities headed by a functional specialist, such as sales, advertising, marketing research, etc.
Use Discussion Question 2-5 here.
A geographic organization might be utilized in a company that sells nationally or internationally.
A product management organization can be found in companies with many different products or
brands.
A market or customer management organization is used in companies that sell one product to
many different kinds of markets and customers.
Very large companies might utilize a combination of all these forms.
Marketing Control
Marketing control involves evaluating the results of marketing strategies and plans and taking
corrective action to ensure that objectives are attained.
The control process includes the following:
Operating control checks the ongoing performance of the marketing programs against
the annual plan.
Strategic control looks at whether the company’s basic strategies are matched to its
opportunities.
Use Discussion Question 2-6 here.
Use Key Term Marketing Control here.
MEASURING AND MANAGING RETURN ON MARKETING INVESTMENT
Marketing managers must ensure that their marketing dollars are being well spent.
Return on marketing investment (or marketing ROI) is the net return from a marketing
investment divided by the costs of the marketing investment. (Figure 2.8)
Video Case: Konica Minolta
Konica Minolta has been in business since 1873. For decades, it was a successful photo company
selling cameras, equipment, and supplies primarily to final consumers. But dramatic changes in
the marketing environment forced the company to reevaluate its marketing strategy and
ultimately to abandon what had been its primary industry.
Today, Konica Minolta has a successful business-to-business strategy centered on office
equipment and print products for commercial printers. The company has also developed a
health-care and medical group, an optics group, and a division that produces components for
mobile phones and televisions. With the advent and growth of social media, Konica Minolta’s
marketing strategy continues to evolve.
After viewing the video featuring Konica Minolta, answer the following questions:
2-15. What is Konica Minolta’s mission?
2-16. What market conditions led Konica Minolta to reevaluate its marketing strategy?
2-17. How has Konica Minolta modified its marketing mix? Are these changes in line with its
mission?
Company Cases
2 Samsung / 1 FedEx / 3 Sony</SUBTTL>
See Appendix 1 for cases appropriate for this chapter.
Case 2, Samsung: A Strategic Plan for Success. Once an off-brand, strategic planning has
made Samsung the number one consumer electronics company.
Case 1, FedEx: Making Every Customer Experience Outstanding. From the time FedEx
opened for business over 40 years ago, the company strategy has been built on a foundation of
obsessive customer focus.
Case 3, Sony: Battling the Marketing Environment’s “Perfect Storm.” Where Samsung has
succeeded through sound strategic planning, Sony is struggling due to the lack thereof.
MyMarketingLab
If assigned by your instructor, complete these writing sections from your Assignments in the
MyLab.
2-18. Explain the roles of market segmentation, market targeting, differentiation, and
positioning in implementing an effective marketing strategy. (AACSB: Communication)
2-19. Marketers are increasingly held accountable for demonstrating marketing success.
Research the various marketing metrics, in addition to those described in the chapter and
Appendix 3, used by marketers to measure marketing performance. Write a brief report
of your findings. (AACSB: Written and Oral Communication; Reflective Thinking)
GREAT IDEAS
Barriers to Effective Learning
1. Students will largely be unfamiliar with strategic planning and its concepts and objectives.
Making this come alive with the examples in the textbook, or your own examples from
your own experience, will help them deal with the complex issues in this section.
2. Working through a mission statement for the marketing department of your university, or for
the business college within which it exists, may give the students a greater appreciation
for the difficulty and importance of defining a mission that lives and breathes life into the
objectives that follow.
3. The Boston Consulting Group’s portfolio analysis tool can also be difficult to understand.
Again, working through examples with companies the students should be familiar with
will aid understanding.
4. University business courses rarely talk about cross-functional teamwork, so this may come as
a surprise to students. If they have worked in internships with large companies, they may
well have seen functional silos at work, and their coursework only serves to reinforce that
mentality. Examples of companies failing because of a lack of teamwork—which can
happen frequently at small companies in particular—will open many students’ eyes to the
importance of ensuring that all functions work in concert to make the company a success.
5. Value chains and supply chains are important concepts that also are typically not discussed in
other courses. Getting students to understand these concepts is important for their
understanding of the remainder of the course. Showing how sloppy quality in a
component purchased from a vendor ultimately affects customer satisfaction will help.
6. Market segmentation and targeting are universally new concepts to students, unless they
happen to have a parent who works in marketing. Although this is discussed in detail in a
future chapter, showing how a large, amorphous market can be broken down in more and
more detailed groups of buyers will help.
7. Market positioning can be difficult to understand as well. Students will normally think of a
product in terms of its features, and although positioning includes the features, it also
spans the concepts of benefits and perceptions. Using examples of brands at opposite
ends of a price continuum, such as Rolex versus Swatch watches, helps drive home what
positioning means.
Student Projects
1 Look at the mission statements of five companies in the same industry. How do their mission
statements differ and how are they alike? Which ones do you believe are good?
2 A business portfolio is the collection of businesses or products that make up the company.
Take a look at Ford (www.ford.com). Describe Ford’s business portfolio in terms of both
businesses and products.
3 Using the Boston Consulting Group’s growth-share matrix, place Ford’s vehicles on the grid.
Which are the stars, the cash cows, the question marks, and the dogs?
4 Still using Ford as our example, discuss the product positioning of their SUVs and trucks.
Small Group Assignment
Form students into groups of three to five. Each group should read the opening vignette to the
chapter on Starbucks. Each group should answer the following questions:
1. What has caused Starbucks lasting popularity?
2. What has been the company’s primary strategy?
3. What is Starbucks doing to ensure its future growth and success?
Each group should then share its findings with the class.
Individual Assignment
Consider the fashion retailers H&M (http://www.hm.com/us/) and Zara
(http://www.zara.com/us/). What is the positioning strategy of each? How are they similar? How
are they different?
Think-Pair-Share
Consider the following questions, formulate answers, pair with the student on your right, share
your thoughts with one another, and respond to questions from the instructor.
1. Design a mission statement for your college/university.
2. What are some of the problems with using a matrix approach (such as the BCG matrix)?
3. What is the difference between market development and product development?
4. Under what conditions might downsizing be a usable strategy?
Classroom Exercise/Homework Assignment
Develop a strategy for attracting new students to your college or university. Write a statement
that describes your college/university’s fit between the goal of attracting the best students and its
capabilities for then educating those students
Classroom Management Strategies
This chapter starts outlining some fairly difficult subjects for students. Strategic planning,
growth-share matrices, and even the development of the marketing mix are relatively tough
concepts for a second chapter in a beginning marketing text. Therefore, when planning how to
present the material, be sure to leave plenty of time to go through at least some of the Applying
the Concepts, as well as defining what the Key Terms really mean in the everyday working
world. Several of the concepts presented in this chapter become important later in the text, and if
the students come away understanding this chapter, they will have an easier time later in the
semester.
1. Company-wide Strategic Planning can be covered in about 15 minutes. Focus on the
“thread” that ties together the corporate strategic plan, corporate and business unit objectives,
and the business or product portfolio. This last topic should be prominent in the discussion, as it
sets the stage for later discussions of new product development.
2. The second major section of the chapter, Planning Marketing, can be covered in 5
minutes. Although this section is important and touches on issues that will come up later in the
text, it does not need to have the same level of focus as the other topics in this chapter.
3. The next section, Marketing Strategy, is extremely important; 20 minutes should be
devoted to this topic. In particular, ensuring the students understand the true meaning of
developing an intelligent marketing mix will set the stage for such later topics as integrated
marketing communications, because they will already have thought about how different
components of a plan should work together.
Finally, 20 minutes should also be devoted to Managing the Marketing Effort. This
section should really drive home the notion that marketing isn’t just a creative endeavor.
For instance, when discussing marketing analysis and the marketing environment, you
can point out how these topics are a big part of what market research is all about.
PROFESSORS ON THE GO
Company and Marketing Strategy:
Partnering to Build Customer Relationships
Key Concepts
Market-oriented mission statements
Setting goals and objectives
Designing and analyzing a business portfolio
In a small group, discuss whether the following statement from Amazon.com meets
the criteria of a good mission statement. “Our vision is to be the earth’s most
concentric company; to build a place where people can come to find and discover
anything they might want to buy online.”
The BCG growth-share matrix identifies four classifications of SBUs: Stars, Cash
Cows, Question Marks, and Dogs. Briefly discuss why management may find it
difficult to dispose of a “Question Mark.”
Which of the following two terms do you think best describes the process of
developing and maintaining a fit between the organization’s goals and capabilities and
its changing marketing opportunities: strategic planning or corporate planning. Why?
Key Concepts
Market segmentation, target marketing, and market positioning
The 4 Ps of marketing
Discuss each of the three steps that a company must perform in choosing the best
market segments and designing strategies to maximize profitability in selected
segments.
Nordstrom’s and Kohl’s are two department stores. Visit their Web sites
(www.nordstroms.com and www.kohls.com) to familiarize yourself with each. Who
do you think each is targeting? How might they be trying to position themselves in
the marketplace?
Do you think that the “4 Ps” marketing mix framework does an adequate job of
describing marketer responsibilities in preparing and managing marketing programs?
Why? Do you see any issues with this framework in relation to service products?
Why would a focus on the 4 Cs be more important than the 4 Ps?
