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Marketing/Product PlanningMarketing/Product Planning

Marketing is a “People Thing”Marketing is a “People Thing”

Copyright © 1997 by Donald Jenner All Rights Reserved

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A Linguistic Thing…A Linguistic Thing…� The term “marketing manager” is too The term “marketing manager” is too

broad.broad.

� In some companies, the marketing In some companies, the marketing

management function has levels, from management function has levels, from

senior management, through various senior management, through various

middle-management levels.middle-management levels.

� An An effectiveeffective marketing manager knows marketing manager knows

everything there is to know about the everything there is to know about the

product. product.

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The Marketing Game PlanThe Marketing Game Plan� Mission, Strategy, TacticsMission, Strategy, Tactics

� compare marketing orientation, 4 Ps… compare marketing orientation, 4 Ps…

[[product, price, promotion, placement ]

� Business, therefore marketing, is Business, therefore marketing, is dynamicdynamic. It changes as perceptions . It changes as perceptions

change.change.� compare critical thinking…compare critical thinking…

� Penalties for blowing thisPenalties for blowing this� compare compare How to Succeed in Business...How to Succeed in Business...

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The Marketing Game PlanThe Marketing Game Plan

� Begin with marketing objectivesBegin with marketing objectives� What is the mission and overall program?What is the mission and overall program?

� How is that mission and program going to How is that mission and program going to be implemented?be implemented?

� Planning is a process managed by Planning is a process managed by

projectsprojects� Includes all cost and time elementsIncludes all cost and time elements

� Various controls and auditsVarious controls and audits� during and after the projectduring and after the project

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The Marketing Game PlanThe Marketing Game Plan� Most enterprises work best when the Most enterprises work best when the

mission or objectives are clear to all the mission or objectives are clear to all the

people involved (customers too?).people involved (customers too?).� The concept of the “team” and “coaching”The concept of the “team” and “coaching”

� The Marketing Plan is part of a larger The Marketing Plan is part of a larger

corporate policy complex.corporate policy complex.� text assumes primacy of consumer-text assumes primacy of consumer-

oriented marketing, and conflicts arising oriented marketing, and conflicts arising

from that, but…from that, but…

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The Marketing Game PlanThe Marketing Game Plan

� The virtues of orderly planning:The virtues of orderly planning:� BudgetBudget

� Less likely to omit important elementsLess likely to omit important elements

� Sharing information and gaining inputSharing information and gaining input� Everyone knows what should be happeningEveryone knows what should be happening

� Of course, this can result in looking a bit silly…Of course, this can result in looking a bit silly…

� Identify outside, hard-to-control elements; Identify outside, hard-to-control elements;

alternatives; variablesalternatives; variables

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Foundation dataFoundation data

� Consumer (end-user, retail) market vs. Consumer (end-user, retail) market vs.

Industrial (wholesale) marketIndustrial (wholesale) market

� Market segments (demographic, &c.)Market segments (demographic, &c.)� market size, maturity factorsmarket size, maturity factors

� How groups can be identified and studiedHow groups can be identified and studied

� What does the company bring to What does the company bring to

market?market?� The 3Com vs. TI story...The 3Com vs. TI story...

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Decision-makingDecision-making

OneOne thing businesspeople do; thing businesspeople do;

NOTNOT the only thing. the only thing.

And we really should ask, do they make prudent decisions, and if they ever do so, when and how so?…

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SWOT AnalysisSWOT Analysis

� List Strengths (advantages, what you do well, List Strengths (advantages, what you do well, resources, other people’s views of your resources, other people’s views of your strengthsstrengths

� List Weaknesses (what you can do better, List Weaknesses (what you can do better, what you do badly, what to avoid)what you do badly, what to avoid)

� Opportunities (and trends)Opportunities (and trends)� Threats (obstacles, competition, changes in Threats (obstacles, competition, changes in

tech, products, specs, &c., financial tech, products, specs, &c., financial problems) — and how they threaten your problems) — and how they threaten your business.business.

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Pareto AnalysisPareto Analysis

� List problems and rank themList problems and rank them

� List possible changes related to each List possible changes related to each

problemproblem� Assess changes for costs and benefits (i. Assess changes for costs and benefits (i.

e., will the change help fix the problem, at e., will the change help fix the problem, at

what cost?)what cost?)

� Focus on implementing best optionsFocus on implementing best options

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Decision TreesDecision Trees

good

poor

moderate

good

poor

moderate

good

poor

moderate

good

poor

thorough development

strengthen products

rapid devlopment

New

Pro

duct

reap devlopment

Conso

lidate

Question:Develop new productor consolidate?

market reaction

Decision nexus

Possible Outcome

This tree shows all the obvious options in the decision to be made

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Decision Trees #2aDecision Trees #2a1st step:Branch probability times branch value

2nd step:Sum of 1st step calcs.

These are the values for the circles.

good

poor

moderate

good

poor

moderate

good

poor

moderate

good

poor

thorough devlopment

thorough development

strengthen products

rapid devlopment

New

Pro

duct

reap devlopment

Conso

lidate

Question:Develop new productor consolidate?

market reaction

Decision nexus

Possible Outcome

$500K

$500K

$50K

$50K

$5K

$5K

$200K

$20K

$20K

$2K

$1K

0.4 0.40.2

0.1 0.20.7

0.3 0.40.3

0.6

0.4

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Decision Trees #2bDecision Trees #2bAssign val-ues to differ-ent possi-bilities. Assign probabilities to uncertain (circle) nodes (values total 1). Calculate possible out-comes)

good

poor

moderate

good

poor

moderate

good

poor

moderate

good

poor

thorough devlopment

thorough development

strengthen products

rapid devlopment

New

Pro

duct

reap devlopment

Conso

lidate

Question:Develop new productor consolidate?

market reaction

Decision nexus

Possible Outcome

$500K

$500K

$50K

$50K

$5K

$5K

$200K

$20K

$20K

$2K

$1K

0.4 0.40.2

0.1 0.20.7

0.3 0.40.3

0.6

0.4

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Decision Trees #3Decision Trees #3

good

poor

moderate

good

poor

moderate

good

poor

moderate

good

poor

thorough devlopment

thorough development

strengthen products

rapid devlopment

New

Pro

duct

reap devlopment

Conso

lidate

Question:Develop new productor consolidate?

market reaction

Decision nexus

Possible Outcome

$500K

$500K

$50K

$50K

$5K

$5K

$200K

$20K

$20K

$2K

$1K

0.4 0.40.2

0.1 0.20.7

0.3 0.40.3

0.6

0.4

cost=?

cost=?

cost=?

cost=?

Fill in cost figures for each major option branch.

Subtract cost from circle-node value.

Result is best-guess at which course works

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Better Business BehaviorBetter Business Behavior

Can you avoid jail?Can you avoid jail?

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The Ethics Thing...The Ethics Thing...

� Despite common prejudice (textbook p. 29), Despite common prejudice (textbook p. 29), no such thing as “Business Ethics”no such thing as “Business Ethics”

� EthicsEthics is the study of how human beings is the study of how human beings actually act when together, how we think they actually act when together, how we think they

shouldshould act if they are to achieve a “highest act if they are to achieve a “highest

good,” and how these two compare. Another good,” and how these two compare. Another name is Moral Philosophy.name is Moral Philosophy.

� Tendency to reduce what-is-right to what-Tendency to reduce what-is-right to what-

feelsfeels-right, or even what-feels--right, or even what-feels-goodgood. . Psychology, &c.Psychology, &c.

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Possible Ethics SystemsPossible Ethics Systems

� ““Code Ethics”Code Ethics”� Divine Instruction (10 Commandments &c.)Divine Instruction (10 Commandments &c.)

� Laws and Government RegulationsLaws and Government Regulations

� Voluntary association-rules and –codesVoluntary association-rules and –codes

� Internal Company Policies & GuidelinesInternal Company Policies & Guidelines

� Ethical Codes are arbitrary, even capriciousEthical Codes are arbitrary, even capricious

� Ethical Codes are either too rigid, or too Ethical Codes are either too rigid, or too

narrow, or too flexible. Never juuuust right.narrow, or too flexible. Never juuuust right.� Lots of loopholes...Lots of loopholes...

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Possible Ethics SystemsPossible Ethics Systems

� Casuistic ethics — based on casesCasuistic ethics — based on cases� Arguments from similarityArguments from similarity

� Arguments from special circumstancesArguments from special circumstances

� Religious casuistic systems Religious casuistic systems � Rabbinic applicationsRabbinic applications

� Jesuitical means/ends justificationsJesuitical means/ends justifications

� Philosophical casuistic systemsPhilosophical casuistic systems� Relation of empty universals and content-laden Relation of empty universals and content-laden

particularsparticulars

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The Ethical ObjectiveThe Ethical Objective

� The Greatest Good (The Greatest Good (summum bonumsummum bonum))� AlwaysAlways happiness and propriety happiness and propriety� BUT:BUT: whosewhose happiness, propriety?happiness, propriety?

� Religious ethics begins with one’s own Religious ethics begins with one’s own happiness, and proceeds to define another’s happiness, and proceeds to define another’s proper actions to that end.proper actions to that end.

� Philosophical ethics begins with one’s own Philosophical ethics begins with one’s own proper actions as conducing to another’s proper actions as conducing to another’s realreal happiness. The most current term: Care.happiness. The most current term: Care.

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BusinessBusiness “ “Ethics”…Ethics”…

� Defines a “good” Defines a “good”

consistent with (at consistent with (at least) managerial least) managerial

happinesshappiness

� Insists on others Insists on others acting accordinglyacting accordingly

� Defines “good Defines “good business practices”; business practices”; “best practices”“best practices”

� Often defines these Often defines these in terms of in terms of “customer “customer satisfaction”satisfaction”

So, where is business ethics,

in the larger scheme of things?

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Some Ethical ContrastsSome Ethical Contrasts

� ““altruistic” reasons altruistic” reasons

for actionfor action

� What is good?What is good?

� The role of the StateThe role of the State� The need for order in The need for order in

societysociety

� Economic/Business Economic/Business

reasons for actionreasons for action

� What is right?What is right?

� The imperative of The imperative of

((bourgeoisbourgeois) freedom) freedom� The need for open-The need for open-

ness if society is to ness if society is to grow.grow.

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Ethical Issues for Ethical Issues for MarketingMarketing

� Does a consumer's view of company Does a consumer's view of company

change buying habits?change buying habits?

� Does a consumer's view of a product Does a consumer's view of a product

change buying habits?change buying habits?

� What kinds of associations drive What kinds of associations drive

customer behavior?customer behavior?

Does this mean marketing ethics is a matter of consumer behavior?...

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External vs. Self-regulationExternal vs. Self-regulation

� Tobacco products — does serving the Tobacco products — does serving the

tobacco industry give advertising a bad tobacco industry give advertising a bad

name?name?

� Anti-competitiveness — who shares Anti-competitiveness — who shares

what at Microsoft? And other things…what at Microsoft? And other things…

� ““Consumerism”:Consumerism”:� public and private “watchdogs”public and private “watchdogs”

� business ethics, social responsibility, &c.business ethics, social responsibility, &c.

Marketing/PR as a tool for managing, balancing interests

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Additional IssuesAdditional Issues

� Whose interests govern business ops?Whose interests govern business ops?� employees? consumers? owners? employees? consumers? owners?

foreigners?foreigners?

� The “Bleeding Heart” viewThe “Bleeding Heart” view

� The “Pragmatic, Take-Care-of-Biz” ViewThe “Pragmatic, Take-Care-of-Biz” View

� The “Responsible Businessperson” The “Responsible Businessperson”

ViewView

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Transnational MarketingTransnational MarketingTransnational MarketingTransnational Marketing

A walk on the wild side…A walk on the wild side…

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Basic QuestionsBasic QuestionsBasic QuestionsBasic Questions

� What is a global market?What is a global market?

� When did such things start?When did such things start?

� WhyWhy did such things start? did such things start?

� How is the current global market How is the current global market

different from precursors?different from precursors?

� How is the global market related to How is the global market related to

local and “high” or world cultures?local and “high” or world cultures?

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PlayersPlayersPlayersPlayers

� Industrialized countries with strong Industrialized countries with strong

economies economies (formerly “1st World”)(formerly “1st World”)

� Industrialized countries with weak Industrialized countries with weak

economies economies (usually, formerly “2nd (usually, formerly “2nd

World”)World”)

� Emerging industrialized countriesEmerging industrialized countries

� ““Less” (actually, Less” (actually, un-un-) developed ) developed

countriescountries

� Problem countries...Problem countries...

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Small-time (?) IssuesSmall-time (?) IssuesSmall-time (?) IssuesSmall-time (?) Issues

� Merely “multinational” (older, home-Merely “multinational” (older, home-

country centered) vs. “global”country centered) vs. “global”

� Nationalisms and related problemsNationalisms and related problems

� XenophobiaXenophobia

� Cultural bigotryCultural bigotry� High culture (“unimondo”, same values...) High culture (“unimondo”, same values...)

vs. national and local culture vs. national and local culture

� The relationships of all these elements The relationships of all these elements

both here and abroadboth here and abroad

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Income picturesIncome picturesIncome picturesIncome pictures

� GDP vs. GDP-per-cap. [GNP vs. GDP]GDP vs. GDP-per-cap. [GNP vs. GDP]� E. g., China (the Chinese figure changes fast)E. g., China (the Chinese figure changes fast)

� E. g., India (different economic environment…)E. g., India (different economic environment…)

� How much is available for “goodies” and How much is available for “goodies” and how much goes to the basics how much goes to the basics (think Maslow)(think Maslow)

� Other differences between DCs and LDCsOther differences between DCs and LDCs

(e. g. what has to be built to grow)(e. g. what has to be built to grow)

� Political and legal “development”Political and legal “development”

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Trade restrictionsTrade restrictionsTrade restrictionsTrade restrictions� Tariffs, import restrictions (quotas)Tariffs, import restrictions (quotas)

� Scale enhancements (e. g., dumping)Scale enhancements (e. g., dumping)

� Embargo (usually a political gesture)Embargo (usually a political gesture)

� Home-country restrictions vs. host-country Home-country restrictions vs. host-country restrictions (e. g. bribery)restrictions (e. g. bribery)

� WTO, IMF, World Bank interferencesWTO, IMF, World Bank interferences� New blocks arising from Doha Round problems, New blocks arising from Doha Round problems,

between agro-countries, industrialized countriesbetween agro-countries, industrialized countries

� National Group trade and political blocksNational Group trade and political blocks� European Union, NAFTA, FTAA &c.European Union, NAFTA, FTAA &c.

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Production vs. DistributionProduction vs. DistributionProduction vs. DistributionProduction vs. Distribution

� Production of any given item is not the Production of any given item is not the

major cost elementmajor cost element

� Distribution is the weakest link — Distribution is the weakest link —

costliest, most prone to failure, least costliest, most prone to failure, least

controllablecontrollable

� Issue then becomes local production vs. Issue then becomes local production vs.

out-of-area productionout-of-area production

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Local productionLocal productionLocal productionLocal production

� If the local economy is relatively If the local economy is relatively

depressed or underdeveloped, local depressed or underdeveloped, local

incentives, lower wages make incentives, lower wages make

production attractive, even if most of the production attractive, even if most of the

product leaves the local area.product leaves the local area.

� Depressed or underdeveloped areas Depressed or underdeveloped areas

are unstable politically and otherwise...are unstable politically and otherwise...

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Services distributionServices distributionServices distributionServices distribution

� LDCs simply don’t compete for servicesLDCs simply don’t compete for services

� LDC reps are generally unable to close LDC reps are generally unable to close

deals (even government reps)deals (even government reps)

� LDC politics favors passing any LDC politics favors passing any

business, but service (less skilled…) business, but service (less skilled…)

business especially through local handsbusiness especially through local hands

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Pricing considerationsPricing considerationsPricing considerationsPricing considerations

� What will the market bear?What will the market bear?� US vs. European trans-Atlantic airfaresUS vs. European trans-Atlantic airfares

� MacDonald’s hamburgersMacDonald’s hamburgers

� local/ordinary vs. local/luxury vs. exoticlocal/ordinary vs. local/luxury vs. exotic

� Local distribution network sets its own Local distribution network sets its own

prices, vs. prices set by transnational prices, vs. prices set by transnational

entityentity

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Promotional elementsPromotional elementsPromotional elementsPromotional elements

� Media availabiltyMedia availabilty

� Local mores & legal restrictionsLocal mores & legal restrictions

� ““Culture neutral” advertising & Culture neutral” advertising &

promotion?promotion?� advantages of local counseladvantages of local counsel

� advantages of “world-wide” agenciesadvantages of “world-wide” agencies