bbi2o_functions_of_business_marketing

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=Marketing=

[|Examples of great viral marketing]. [|Examples of] great traditional marketing.

What are the differences? What are the similarities?

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Slideshows [|Marketing 1]and [|Marketing P's and C's]

The Role and Impact of Marketing
Marketing is all activities involved in getting goods and services from the businesses that produce them to the consumer.

Marketing has two fundamental roles: to sell what a business makes and to manage the brand. Marketing activities include

BRANDING
Businesses can spend millions creating an image for products and services with a brand name, logo or trademark, and a slogan.

**Brand Name**

 * A brand name is how a product and company are identified and it is important to organizational success.When people talk with others about brand preference this is free publicity for the company.

**Logo or Trademark**

 * A logo or trademark helps a product compete for consumer awareness.
 * //**Monogram**//: a stylized rendering of a company’s initials or a combination of initials and numbers. Examples include IBM (International Business Machines) who wanted to consumers to associate them with computers not adding machines, and KFC (Kentucky Fried Chicken) who did not want consumers seeing the work “Fried”, etc.
 * //**Visual symbol**//: These are line drawings of people, animals, or things such as Apple Computer’s apple and Kellogg’s Frosted Flakes’ Tony the Tiger.
 * //**Abstract symbol**//: These are shapes that carry a visual message but are not representative of actual things.The Nike “swoosh” is an example and one of the world’s most well recognized logos.

**Slogan**
**Brand Identification**
 * Slogans are taglines for both print and broadcast advertisements. Examples include; MasterCard’s “Priceless,” Canadian Blood Services’ “It’s in You to Give,” and Sprite’s “Obey Your Thirst”.
 * The writing, the colours used, the design of the package should always be used in association with the product, this way it is always clear to the consumer that they are getting the product they desire.

THE PRODUCT LIFE CYCLE
Successful marketing efforts created brand awareness; customers can name you brand as part of a specific category. Brand loyalty is when customers prefer your brand and support it. Brand insistence is when customers will not accept a substitute for a particular brand. Brands that have reached brand insistence have enormous **brand equity.**
 * **Product Introduction**: Is the **launch** of a product into the marketplace. It may be done locally, all the way to internationally.
 * Businesses need to inform potential customers about the products features, availability, package design, and brand identification.
 * **Early adopters** are individuals who like to be one of the first to try a new product.
 * Marketers often focus their early efforts on these trendsetters who can be sports icons, celebrities, or even students.
 * **Growth**: As the new product sales increase competitors enter, this can decrease profitability due to decreased market share. They often compete by adding features, improving quality, or sell at a lower price;.
 * The product line becomes very visible and is promoted on commercials, billboards, print ads, etc.
 * Some competitors start to drop out of the competitive race at this stage.
 * **Maturity**: Growth is flat; it does not increase or decrease, and brand equity is at its highest.
 * Businesses keep advertising the product to keep it in the consumers’ eye.
 * Products, also know as **cash cows**, at this stage usually make large profits and this income can be used to develop and fund new products for the company. Examples include Tide and Kellogg’s Corn Flakes.
 * **Decline**: When sales decrease because customers leave to by other brands, and they are not replaced, a product can enter the decline stage.
 * Sometimes a change in price or advertising can slow down or stop the decline.
 * **The Decision Point**: The business may make an effort to regain original sales figures and brand equity or they may discontinue the product altogether. If they try to save the product a variety of options are available:
 * Repositioning: making the product popular with a new consumer group
 * Reformulate (new scent), repackage (new container and spout), and re-introduce (new and improved) the product.
 * Repricing to gain popularity.
 * New promotion.Obsolete technology utilized in the product will make such that no amount of marketing efforts will restore product position.

NON-TRADITIONAL PRODUCT LIFE CYCLES
**Fads** **Seasonal**
 * Trends are not fads, trends last longer and influences other areas.
 * Some well-known fads are hula hoops, yo-yos, Pogs, and Tamagotchis.
 * Businesses who plan well, and sell most of its stock and get out of the market just before the fad reaches its peak, can make an excellent profit.
 * Some companies market **knock-offs** of fads, often a cheaper version. If they do not sell off their inventories before the fad quickly dies off they can stand to lose money.
 * Niches**
 * A niche product tends to have a short growth stage and leads to a solid, but not financially spectacular, maturity stage.
 * Niche marketers usually invent their products and hold exclusive patents or formulas.
 * By the time the competition can produce a competitive product the niche marketers have cornered that market.
 * Barriers to entry include the small market size, the cost of R&D, advertising expenses, factory and equipment costs, design costs, lack of distribution channels, and the cost of raw materials.
 * Christmas and summer are seasonal time frames within which certain products are marketed.
 * **Inventory management** is the balancing of product quantity with sales.

Marketing Concepts
The **Four Ps of Marketing** are the four elements of a good marketing campaign: product, price, place, and promotion. The **Two Cs of Marketing** are the two major external factors in marketing: the competition and the consumer.

THE FOUR Ps OF MARKETING
The four Ps of marketing are product, price, place and promotion.

1. Products and Services
The two reasons businesses develop product are because they can and they see a need. The development of good products and services considers quality, design, features, and benefits.

Quality

 * Consumers depend on the quality of many established brand names.
 * Consumers know that higher quality usually means that the product or service is more expensive.
 * Some products are successful because they can meet consumer needs, at a lower quality, and therefore a lower price.

Design

 * We often think of design in relation to clothing, such as jeans that come in many different styles.
 * When a package is designed the function has to be considered.
 * Packaging protects the product from light, dirt, germs, air, water, tampering, and damage.
 * Packaging can aid ease of use, such as a spout or a resealable bag.
 * Product identification or recognition benefits from package shape and colour, such as the Coca-Cola bottle.
 * Label design is also an aspect of design and it can help a product stand out. Labels also give information such as size, weight, ingredients, and nutritional facts.
 * Services consider design features in their web pages and the physical design of their store.

Features

 * Some examples of product features are the smell of different perfumes, foam or feather pillows, and laundry detergent can be spring sent or sent-free.

Benefits

 * Examples of benefits are a microwave that cooks food faster or a can opener that does not leave a sharp edge.

The Product/Service Mix

 * A retail store could offer a delivery service, an installation service, or a gift-wrapping service.
 * A service business, such as a veterinarian could not only assist ill pets but could sell pet food products as well.

2. Price
On a very basic level……PRICE = COST + PROFIT
 * If consumers think the price of a product is too high, it will not sell. Consumers can easily find out product prices by searching on the Internet.
 * Marketers need to be aware of how **price sensitive** their product is: how much sales will go up or down when the price goes up or down.

3. Place (Channels of Distribution)

 * A product does not change as it moves through the distribution chain.
 * If the product is changed or altered that is the end of that channel and a new one begins.

Direct Channels

 * Simplest form of distribution.
 * Direct channel distribution does not use **intermediaries** or businesses that take possession of the goods before the consumers do, they add costs to the product so that they realize a profit.
 * With direct channels consumers can readily inform the producers of their needs and they may feel more confident about the product because they deal directly with the company that produces it.

Indirect Channels of Distribution

 * Importers: **Importers** are businesses that seek out foreign products to bring into their own country. Importers may negotiate distribution deals with foreign manufacturers, buy the goods, store the goods, and may sell the goods. To eliminate risk importers can arrange only delivery of foreign goods to Canadian businesses.
 * Wholesalers: **Wholesalers** buy goods from producers or importers and resell the goods to retailers. The manufacturer may require that the retailer buy a minimum quantity of goods. Using a wholesalers may mean that the retailer pays a higher price but they get the quantity they need and the wholesaler may store the products close by.
 * Retailers: Linked directly to consumers, retailers buy merchandise customers want, keep it in stock, and display it so that customers can examine it in an easy-to-reach location.

Specialty Channels

 * **Vending Machines**: Vending machines, that can sell virtually anything, can be placed where consumers are.
 * **Telemarketing**: Using the telephone to sell products and services is very popular. A **sales pitch** or scripted presentation that anticipates all possible consumer responses is delivered to people once the **automated call distributors (ACDs)**, a computerized dialing system, calls them.
 * **Catalogue Sales**: Catalogues from retailers provide information about merchandise that consumers can purchase by mail, phone, or at the store.
 * **E-commerce**: The most important specialty channel, e-commerce is selling products and services online. For consumers it is convenient and competitive and for manufacturers and retailers it reduces distribution costs.

4. Promotion

 * //**Coupons:**// offer consumers money off the price of a product but **redemption rates**, a method of determining effectiveness, are only about 5%.
 * //**Contests:**// increase brand recognition through an anyone can enter and win concept that is not gambling and cannot require a purchase to enter.
 * //**Premiums:**// are when the consumer makes a purchase and they get something for free.
 * **Customer loyalty cards** are stamped with each purchase and, when full, entitles the customer to a discount or a free product.
 * //**Samples:**// samples are small “trail” sizes of a product that are given to consumers, it is expensive but often results in increased sales.
 * //**Special Events:**// are used to attract customers and increase sales.

THE TWO Cs OF MARKETING
The marketing department must consider two major external factors: the competition and the consumer.

1. The Competitive Market

 * The soft drink market has a flavoured market segment (root beer for example) and an energy drink segment (Red Bull for example).
 * The two ways to increase market share are to **increase the size of the** **overall market** (the introduction of energy drinks created a new segment) and to **take sales away for the competition**.

Competition among Products
 * All products and services compete for the consumer’s money in some way.
 * Indirect Competition: Is competition between products or services that are not directly related to each other such as a teen with $25 who decides on spending it on movie tickets or on a CD.
 * Discretionary Income: The portion of one’s disposable income that is not already committed to paying for necessities and can be used to buy things for pleasure, satisfaction, and comfort.
 * Disposable Income: Is the amount of income that is left after taxes have been paid. This income can be used to pay for the basic necessities such as food, clothing, and shelter.
 * Direct Competition: Competition between products that are very similar and have only minor differences. These products that compete directly with each other do so through image, quality, price, design, features, and benefits.

2. The Consumer Market
 * Demographics are used by businesses to target specific consumers.
 * Age: Age defines our tastes as well as our needs and wants. Some age groups are consumers, but not always customers. Adults or parents are gatekeepers, or the person who makes buying decisions for others, often children who can influence their decisions.
 * Gender: Some products lines are distinctly marketed to men or women, but more and more traditionally gender marketed products are being targeted to both groups (detergent and power tools are examples).
 * Family life cycle: People’s stage in the family life cycle often determines needs and wants. New parents need baby items and seniors may buy a retirement escape.
 * Income level: Is the grouping of consumers by how much money they make or have. Some products are marketed to consumers in every income bracket (Kellogg’s Corn Flakes), some are not (Mercedes).
 * Ethnicity and culture: Businesses target people based on their background and customs.
 * Lifestyle study is called psychographics.
 * When marketing to demographic groups, marketers need to consider their lifestyles because a person’s beliefs (such as being environmentally conscious or concerned about diet) influence what they purchase.

Creating good advertising
Can be referred to as the AIDA principal: **Attention, Interest, Desire, and Action**
 * Attract Attention: Print ads need a good headline, it should not be more than seven words, it should mention the brand, and should encourage receiver to read the rest of the ad. Broadcast ads attract attention with sound, unusual visuals, attractive people, celebrities, or something funny.
 * Gain Interest: Print ads should be easy to read and to the point. Broadcast ads should get to the message quickly. Visual images should be strong.
 * Build Desire: Print ads should build desire with words, adding benefits with each line. Broadcast ads repeat brand names.
 * Get Action: Ask the consumer to buy now, give them reasons, and provide the necessary information so that they can.

Types of Advertising
Advertising, that always is the advertisers’ point of view, costs a lot of money. **Publicity**, usually more believable that advertising, is information about a business, either positive or negative, that appears in the media and is not paid for by the business. Some companies hire public relations (PR) firms that can influence the media with well written positive stories about the business.


 * Direct-to-home advertisements: are messages (flyer or catalogue) that come directly to a person’s residence.
 * Out-of home advertising: are messages (billboard or bus ad) that the consumer is supposed to receive while not at home.
 * Radio advertisements: or “go anywhere” medium uses words and sound to draw us in.
 * Television: and effective but expensive medium, combines words, sound, and images to reach very large audiences.
 * Newspaper ads: range from inexpensive local ads in the classified section to full page spreads in national publications.
 * Magazines: offer the opportunity to target specific groups of consumers with colour.
 * The Internet: allows for 4 different types of advertising: company websites, banner ads on other websites, and e-mail advertising (spamming).
 * Viral advertisement: usually internet-based, but may not be. Often doesn't look to be coming from the company directly. Relies on social-networking to be successful.

Comparing types of advertising

 * Reach means the number of people exposed to a message.
 * Frequency is the number of times an audience will see or hear the ad over a given period of time.
 * Selectivity means the ability of the medium to focus on a target audience.
 * Durability means how long the advertisement lasts in the house.
 * Lead-time means how fast the ad can be ready to run.
 * Mechanical requirements means how complex it is to prepare the ads for the medium.
 * Clutter means the level of competition for the audience’s attention.
 * Costs means the accumulated costs of running the advertisement.

Types of marketing research

 * Consumer research uses methods such as phone or personal interviews to discover what type of products consumers want and predicts the sales potential of that product.
 * Market research identifies specific groups of consumers who would use a particular product or service.
 * Motivation Research tries to find out why we buy, by looking at the emotional and rational motives that influence buying decisions.
 * Pricing research helps a company decide if they can sell a product for a competitive price and make a profit.
 * Competitive research looks for opportunities where competition is weak or absent and determines what competitors are doing.
 * Product research looks at details of a product or service and analyzes the impact these details might have on the market.
 * Advertising research gives information on effective ways to get a message to potential consumers.

Secondary Data

 * Researchers re-interpret secondary data for their own or their clients’ purposes.
 * A lot of secondary data is available for free, however sources such as databases or reports can be costly (a beverage industry report costs almost $10,000!).

Primary Data

 * Test marketing involves producing a limited quantity of a new product and introducing it to one or two areas (in Ontario London, Peterborough, and Kingston are often used). This method is expensive and should be done carefully to ensure good decisions.
 * Internal information sources includes data mining, the analyze of a company’s own records (sales, inventory, advertising, and promotional results), that gathers primary data on product history and/or customer behaviour.
 * Surveys are a planned set of questions used to gather data that can be analyzed to help solve problems. Most surveys us closed-ended questions for which respondents must select an answer from two or more choices they are given. Open-ended questions are questions that allows respondents to develop their own answers, they are difficult to analyze and are used only when very specific data is needed.
 * Observation is used to learn how people react to situations and it is done without interaction and often when the subject does not know they are being watched.
 * Focus groups are company-arranged meetings of potential consumers that the marketer observes during an organized discussion. Participants are usually paid.

__Assignment #9__ - Example of good Marketing - Campaigns or Viral
([|Presentation Pointers])
 * Showcase an effective campaign

The purpose of this activity is to introduce students to the effective campaign strategies

You are going to visit various websites/blogs and report on the campaign of your choice.

a. give a general overview of the campaign including either the print, audio or video of your choice from the campaign b. give estimates of how much of an increase/decrease in sales that resulted from the campaign. c. suggest improvements or followup items to their campaign d. relate the campaign to the p's and c's of marketing.

Follow the sequence below to complete this exercise:

1) Groups of 2 or less. 2) Research a campaign 3) Let McIntyre know of the campaign before leaving the computer lab 4) Use either MS Powerpoint or OpenOffice Impress to put together a summary of your findings addressing points a.->d. listed above || __**Marketing**__ **__Marking Scheme__**

Names: Campaign:

How much did you research/think about the project
 * __Thinking__** **/ 5**
 * An adequate amount of information is provided
 * The information provided is worthwhile and accurate
 * Presentation follows an organized order and flows from start to finish

Presentation is delivered professionally How it was put together
 * __Communication__** **/20**
 * Limited Reading Name
 * Confidence and comfortable with material Name
 * Presenter adds to information on slideshow
 * No grammar/spelling mistakes
 * Presenter is professional in appearance and behaviour
 * __Application__** **/ 10**
 * All slides/videos are relevant (make sure you don't randomly throw in irrelevant information about the campaign)
 * Slides are consistent in its features (font style sizes, animations, colours, etc.)
 * No part of the presentation distracts the audience from learning


 * / 35**
 * __Comments:__**

//Tools necessary//:


 * writeup MS Powerpoint or Open Office Impress (saved in **Word 97-2003** format if you have a more modern version)
 * [|Google]

__Assignment #10__ - Marketing the "Unmarketable"
[|Marketing the UnMarketable]

//Tools necessary//:


 * writeup MS Powerpoint or Open Office Impress (saved in **Word 97-2003** format if you have a more modern version)
 * [|Google]