Download - Marketing Management
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Lecture 1
Marketing Management
Dr. Derek N. Hassay
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Lecture 1
What is Marketing?
“Satisfying consumer needsand wants… profitably!”
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Core Conceptsin Marketing
Goods &Services
Needs, wants,and demands
Exchange, transactions,and relationships
Markets
Value, satisfaction,and quality
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What is Marketing?
“In the factory we make cosmetics;in the drugstore we sell hope.”
Charles Revson
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General Management Philosophies
ProductionConcept
SocietalMarketingConcept
MarketingConcept
ProductConcept
Selling Concept
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The Societal Marketing Concept
Consumers(Satisfaction)
Company(Profits)
Society(Public Welfare)
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MaximizeConsumptionMaximize
Choice
Maximize Quality of Life
MaximizeSatisfaction
Marketing System Goals
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“Worshipping themarketing conceptstifles innovation.”
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Customer Value
-
=
Total CustomerValue
Total CustomerCost
(Product, Service, Personnel,& Image Values)
(Monetary, Time, Energy,& Psychic Costs)
CustomerDelivered Value
(Profit to the Consumer)
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Value-Building Approaches
FinancialBenefits
Social benefits
StructuralTies
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Customer Satisfaction
CustomerDelight
CustomerDelight
ExpectationsExpectations SatisfactionSatisfactionThe Goal
of CustomerSatisfaction
Expectations Met
Expectations Exceeded
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Types of Loyalty
Loyalty
Spurious Loyalty
Latent Loyalty
No Loyalty
Positive
Negative
Always/Often Seldom/Never
Att
itu
de
/Aff
ec
t
Frequency of Purchase
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Lecture 1
Retaining Customers
NewCustomer
Costs
LostCustomer
Costs
CustomerLifetime
Value
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Elements of a Marketing Strategy
TargetConsumers
Product
Place Price
Promotion
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Lecture 1
“Marketing is not an event, but a process…It has a beginning, a middle, but never an end, for it is a process. You improve it, perfect it, even pause it. But you never stop it completely.”
Philip Kotler
Marketing Management
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Steps in Strategic Planning
Defining theCompany Mission
Defining CompanyObjectives and Goals
Designing theBusiness Portfolio
Production, Marketing and Other Functional Strategies
Corporate Level
Business Level
PlaceTarget
Market
ProductProduct
Price
Promotion
Marketing Strategy Elements
Marketing Mix (the 4Ps) + Target Market = Marketing Strategy
AnalysisAnalysis Planning
PlaceTarget
Market
Control
Product
Product
Price
Implementation
Marketing Management Framework
Objectives
MissionStrategies Portfolio
TheMarketingManagementFramework
TheCorporateStrategicPlan
EconomicEnvironment
Analysis Planning
Place
Control
Product
Price
Promotion
Implementation
Target
Market
Resources
Marketing
Intermediaries
PublicsCompetition
Corporate
Objectives
Suppliers
Political/Legal Environment
Natural Environment
TechnologicalEnvironment
Demographic Environment
Social/CulturalEnvironment
The Marketing Environment
Analysis Planning
Place
Control
Product
Price
Promotion
Implementation
Target
Market
Resources
Marketing
Intermediaries
PublicsCompetition
Corporate
Objectives
Suppliers
EconomicEnvironment
Political/Legal Environment
Natural Environment
TechnologicalEnvironment
Demographic Environment
Social/CulturalEnvironment
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Lecture 1
“Induce your competitors not to invest in those products, markets and services where you expect to invest the most … that is the fundamental rule of strategy.” Bruce Henderson, Founder of BCG
“One does not rely on the enemy not attacking, but relies on the fact that he himself is unassailable.” Sun Tsu, The Art of War
Competitive Strategy
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Strategies of Firms in aHypothetical Market Structure
40%
Marketleader
30%
Marketchallenger
20%
Marketfollower
Expand Market
Defend Market Share
Expand Market Share
Attack leader
Status quoImitate
10%
Marketnicher
Specialize
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Pursuing a Niche Strategy
• End-user specialist• Vertical-level specialist• Customer-size specialist• Specific-customer specialist• Geographic specialist• Product or product-line specialist• Product-feature specialist• Job-shop specialist• Quality-price specialist• Service specialist• Channel specialist
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Defensive Strategies
Attacker
(3) Preemptivedefense
(4) Counter-offensivedefense Defender
(1)Positiondefense
(5)Mobile
defense
(2) Flank defense
(6) Contractiondefense
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Position Defense
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Offensive Strategies
Defender
(3) Encirclement attack
(4) Bypass attack
(2) Flank attack
(5) Guerilla attack
(1) Frontal attack
Attacker
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Management Decision-making with “Case Analysis”
• Situation Analysis• Identification of Key Marketing Issue• Identification of Objectives (Decision Criteria)• Generation & Evaluation of Alternatives• Recommendation• Implementation Plan
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Situation Analysis
External Environment: • Opportunities & Threats
– Industry (barriers to entry, sales trends)– P.E.S.T. (stability, forecasted changes)– Competition (resources, position)– Customers (preferences)– Channels
Internal Environment:• Strengths & Weaknesses
– Marketing Mix– Consumer Awareness– Assets, Skills,Resources
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Key Marketing Issue(s)
• Idea is to present the issue facing the firm in a succinct manner (2-3 sentences).
• May not be a problem, may be an opportunity.
• Caution: Make sure that you have identified the cause and not the symptom of a problem?
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Generation of Objectives(Decision Criteria)
Qualitative:• Issues of “fit”• Timeliness• Available Skills• Capacity
Quantitative:• Profit• Market share• Awareness• ROI
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Generation & Evaluation of Alternatives
• Selection of 3-4 feasible, mutually distinct alternatives• Doing nothing (i.e., status quo) is rarely a
feasible alternative• Evaluation (advantages, disadvantages)
of alternatives based upon decision criteria
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Recommendation
Brief statement outlining:• Why the recommended course of action is the best available
alternative. • Decision must be based upon criteria and must be an evaluated
alternative
Implementation Plan
Specifically what is to be done:• By whom• When• Where