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mkt350 Kotler Chapter 2
mkt350 Kotler Chapter 2
mkt350 Kotler Chapter 2
Kotler
Keller
Organizational Environment
Includes all elements existing outside the boundary of the organization that have the potential to affect the organization
Organizational Environment
General Environment
Technological
Task Environment
Customers Labor Market Internal Environment Employees Culture Competitors
Management
Suppliers
1) 2)
Information Information related to: macro trends micro effects particular to their business environment is constantly presenting new opportunities and threats. Marketers should continue monitoring and adapting to that environment.
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Responsibility
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Evidence (s)
Marketers also have extensive information about how consumption patterns vary across countries. the Swiss consume the most chocolate, the Greeks eat the most cheese, the Irish drink the most tea, and the Austrians smoke the most cigarettes
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Why Information?
Companies with superior information enjoy a competitive advantage. The company can : 1) choose its markets better, 2) develop better offerings, and 3) execute better marketing planning
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MIS
consists of: people, equipment, and procedures to gather, sort, analyze, evaluate, and distribute needed, timely, and accurate information to marketing decision makers.
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What decisions do you regularly make? What information do you need to make these decisions? What information do you regularly get? What special studies do you periodically request? What information would you want that you are not getting now? What are the four most helpful improvements that could be made in the present marketing information system?
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Internal Records
Marketing managers rely on internal reports on: 1. orders, 2. sales, 3. prices, 4. costs, 5. inventory levels, 6. receivables, 7. Payables 8. By analyzing this information, they can spot important opportunities and problems.
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Internal Records
1.
2.
3. 4.
Order-to-Payment Cycle Sales Information System Databases, Warehousing, Data mining Marketing Intelligence System
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Order-to-Payment Cycle
1.Customers and sales representatives fax or e-mail their orders. 2.Computerized warehouses quickly fill these orders. 3.The billing department sends out invoices as quickly as possible. using the Internet and extranets to improve the speed, accuracy, and efficiency of the order-to-payment cycle.
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Internal Records
Wal-Mart
knows the sales of each product by store and total each evening.
enables it to transmit nightly orders to suppliers for new shipments of replacement stock. Wal-Mart shares its sales data with its larger suppliers such as P&G and expects P&G to re-supply Wal-Mart stores in a timely manner.
Wal-Mart has entrusted P&G with the management of its inventory. Outsourcing
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Internal Records
customer database
customer database will contain every customer's: 1. name, 2. address, 3. past transactions, 4. demographics and 5. psychographics (activities, interests, and opinions) in some instances.
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Sources of Information
Marketing managers collect marketing intelligence by: 1. reading books, 2. newspapers, and trade publications; 3. talking to customers, suppliers, and distributors; and 4. meeting with other company managers.
Train and motivate sales force Motivate channel members to share intelligence Network externally Utilize customer advisory panel Utilize government data resources Purchase information Collect customer feedback online
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Trend Mega-trend
large social, economic, political and technological changes [that] are slow to form, and once in place, they influence us for some time between seven and ten years, or longer.
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Aging boomers Delayed retirement Changing nature of work Greater educational attainment Labor shortages
Increased immigration Rising Hispanic influence Shifting birth trends Widening geographic differences Changing age structure
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Environmental Forces
opportunities and threats
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Economic Environment
$ Purchasing Power
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Social-Cultural Environment
Views of themselves Views of others Views of organizations Views of society Views of nature Views of the universe
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Natural Environment
Shortage of raw materials Increased energy costs Anti-pollution pressures Governmental protections
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Technological Environment
Pace of change Opportunities for innovation Varying R&D budgets Increased regulation of change
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Megatrend
the increase in the percentage of Hispanics in the total population, represents a major shift in the nation's center of gravity. Hispanics made up half of all new workers in the past decade and will bump up to 25 percent of workers in two generations.
In addition to monitoring a changing marketing environment, marketers also need to develop specific knowledge about their particular markets. Good marketers want information to help them interpret past performance as well as plan future activities. Marketers need timely, accurate, and actionable information on consumers, competition, and their brands. They need to make the best possible tactical decisions in the short run and strategic decisions in the long run. Discovering a consumer insight and understanding its marketing implications can often lead to a successful product launch or spur the growth of a brand.
Build-A-Bear
T-Louis-based Build-A-Bear Workshop has cleverly capitalized on the "kiddiecraft" trend in children's toys as well as the trend for interactive entertainment retailing. Instead of making pottery or play jewelry, the chain, with more than 160 stores in the United States, the United Kingdom, Japan, Denmark, and Korea, allows kids (and adults too) to design their own teddy bears and other stuffed animals, compete with clothing, shoes, and accessories. The chain boasts an average of over $500 per square foot in annual revenue, double the U.S. mall average, ten percent of sales in 2003 came from hosting nearly 100,000 parties at a cost to customers of approximately $250 for two hours, which includes a stuffed animal for each child. Build-A-Bear has created a database on 9 million kids and their households by inviting customers to register their bears:
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Build-A-Bear
By including a barcode inside the bear, the company can reunite the owner with the bear if it gets lost.
The database allows Build-A-Bear to contact customers by surface and e-mail with gift certificates, promotions, and party reminders.
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market survey
sales forecast by region
product-preference test
advertising evaluation
marketing research is systematic design, collection, analysis, and reporting of data and findings relevant to a specific marketing situation facing the company.
Marketing research is now about a $16.5 billion industry
Research Objectives
Research objectives:
What types of first-class passengers would respond most to using an in-flight Internet service? How many first-class passengers are likely to use the Internet service at different price levels? How many extra first-class passengers might choose American because of this new service? How much long-term goodwill will this service add to American Airlines' image? How important is Internet service to first-class passengers relative to providing other services such as a power plug, or enhanced entertainment?
Research Types
Exploratoryresearch: its goal is to shed light on the real nature of the problem and to suggest possible solutions or new ideas. Descriptiveresearch: is it seeks to ascertain certain magnitudes, such as how many firstclass passengers would purchase in-flight Internet service at $25. Causalresearch: Its purpose is to test a causeand-effect relationship.
Data sources
Data sources: Primary data can be collected in five main ways: Observation, Focus groups, Surveys, behavioral data, Customers leave traces of their purchasing behavior in store scanning data, catalog purchases, and customer databases. Experiments.
Behavioral Data
Customers leave traces of their purchasing behavior in store scanning data, catalog purchases, and customer databases.
Survey Research
Companies undertake surveys to learn about people's knowledge, beliefs, preferences, and satisfaction, and to measure these magnitudes in the general population.
Focus Group
is a gathering of six to ten people who are carefully selected based on certain demographic, psychographic, or other considerations and brought together to discuss at length various topics of interest.
Experimental Research
The most scientifically valid. The purpose of experimental research is to capture cause-and-effect relationships by eliminating competing explanations of the observed findings.
Experiments call for selecting matched groups of subjects, subjecting them to different treatments, controlling extraneous variables, and checking whether observed response differences are statistically significant.
RESEARCH INSTRUMENTS
three main research instruments in collecting primary data: 1) questionnaires, 2) qualitative measures, and 3) mechanical devices.
Qualitative research
QR techniques are relatively unstructured measurement approaches that permit a range of possible responses, and they are a creative means of ascertaining consumer perceptions that may otherwise be difficult to uncover.
seven techniques
Shadowing observing people using products, shopping, going to hospitals, taking the train, using their cell phones. Behavior mappingphotographing people within a space, such as a hospital waiting room, over two or three days. Consumer journeykeeping track of all the interactions a consumer has with a product, service, or space. Camera journalsasking consumers to keep visual diaries of their activities and impressions relating to a product. Extreme user interviewstalking to people who really knowor know nothingabout a product or service and evaluating their experience using it. Storeytellingprompting people to tell personal stories about their consumer experiences. Unfocus groupsinterviewing a diverse group of people: To explore ideas
Mechanical Devices
Mechanical devices are occasionally used in marketing research. After each exposure, the respondent describes everything he or she recalls. Eye cameras study respondents' eye movements to see where their eyes land first, how long they linger on a given item, and so on. Audiometers can be attached to television sets in participating homes to record when the set is on and to which channel it is tuned.
SAMPLING PLAN
SAMPLING PLAN After deciding on the research approach and instruments, the marketing researcher must design a sampling plan. 1. Sampling unit: Who is to be surveyed? 2. Sample size: How many people should be surveyed? 3. Sampling procedure: How should the respondents be chosen?7o
A. Probability Sample
B. Non-probability Sample
CONTACT METHODS
Once the sampling plan has been determined, the marketing researcher must decide how the subject should be contacted: 1)mail, 2) telephone, 3)personal, or online interview.
2) 3)
4)
Getting the right respondents is critical. In the case of surveys, four major problems arise. Some respondents will not be at home and must be contacted again or replaced. Other respondents will refuse to cooperate. Others will give biased or dishonest answers. Finally, some interviewers will be biased or dishonest.
The main survey findings for the American Airlines case show that:
The chief reasons for using in-flight Internet service are to pass the time surfing, and to send and receive messages from colleagues and family. The charge would be put on passengers' charge accounts and paid by their companies.
The main survey findings for the American Airlines case show that:
About 5 first-class passengers out of every 10 would use the Internet service during a flight at $25; about 6 would use it at $15. Thus, a charge of $15 would produce less revenue ($90 = 6 x $15) than $25 ($125 = 5 X $25). By charging $25, AA would collect $125 per flight.
Assuming that the same flight takes place 365 days a year, AA would annually collect $45,625. Since the investment is $90,000, it will take approximately two years before American Airlines breaks even.