marketing 300 discussion section

http://mywebspace.wisc.edu/rkamath/ marketing 300 discussion section http://mywebspace.wisc.edu/rkamath/

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http://mywebspace.wisc.edu/rkamath/ agenda  creative strategy  exam review

http://mywebspace.wisc.edu/rkamath/ Managing the Advertising Program Key steps: 1.Define the target segment(s): Single or multiple 2.Objectives: inform, remind or persuade 3.Budget: PLC, market share and consumer base, competition and clutter, frequency, and substitutability 4.Choosing the advertising message - All the creative in the world cannot boost sales for a flawed product or strategy. 5.Media: Most cost effective choice. 6.Evaluation

http://mywebspace.wisc.edu/rkamath/ Message Components - Creative Strategy 1. Message generation: What is the major benefit that the product offers? Should be decided as a part of the product concept. 2. Message evaluation and selection : Focus on one core selling proposition. Key evaluative elements: desirability, exclusiveness, believability. 3. Message execution : Copy strategy defines the objective, content, support and tone of the desired ad. 4. Media: type, reach, frequency, impact, timing 5. Evaluating Advertising Effectiveness : research, sales.

http://mywebspace.wisc.edu/rkamath/ Message execution Positioning is the basis of strategy: – The point of difference is often the key benefit – The target already established, is more detailed Creative Strategy adds to the positioning: – Perceptions - How the target perceives the category – Objective--What you want the target to do? – Support --The reason the target should believe the key benefit.

http://mywebspace.wisc.edu/rkamath/ Positioning The single benefit that distinguishes your product/service from its competitors in the consumers minds

http://mywebspace.wisc.edu/rkamath/ Positioning Statement To (target), (your product) is the one (category) that (point of difference in the form of a benefit or attribute). Support this position with a paragraph that elaborates on the above. Can include support, problem/solution - anything that helps convey the positioning clearly.

http://mywebspace.wisc.edu/rkamath/ Positioning

http://mywebspace.wisc.edu/rkamath/ Sample Positioning Statement Mad Cat (cat food) To cat owners whose cats play outdoors, Mad Cat is the one dry cat food that helps country cats stay rabies-free. Country cats aren’t like city cats. They climb trees, chase squirrels, and get into fights with various animals- they’re more active cats. But sometimes Smokey gets bitten by animals teeming with rabies. That’s why we developed Mad Cat, the first dry cat food fortified with rabies vaccine to help keep country cats active and not foaming at the mouth. If you have a country cat, you need Mad Cat cat food for active country cats.

http://mywebspace.wisc.edu/rkamath/ Creative Strategy The creative strategy is the basis for advertising development and the standard against which all advertising concepts and executions must be judged.

http://mywebspace.wisc.edu/rkamath/ Elements of a Creative Strategy Perceptions: – What are the target’s perceptions about the product, the category, the market? Example – Cats that live in the country are more likely to get rabies than city cats – Putting rabies vaccine in food will prevent the cat from contracting rabies – All other cat foods are pretty much the same

http://mywebspace.wisc.edu/rkamath/ Elements of a Creative Strategy Target Audience: – To whom are we talking? Example – Cat owners who perceive cats to be active, and outdoors much of the time; and people who have cats, who are scared of their cats getting rabies.

http://mywebspace.wisc.edu/rkamath/ Elements of a Creative Strategy Objective: – What do we want the target to do? Try Mad Cat instead of the brand they are using, and use it as a preventative measure instead of getting rabies shots

http://mywebspace.wisc.edu/rkamath/ Elements of a Creative Strategy Benefit: – What is the core idea that’s going to get the target to do what we want them to do? Mad Cat prevents cats from getting rabies

http://mywebspace.wisc.edu/rkamath/ Elements of a Creative Strategy Support: – Why should they believe it? It’s recommended and endorsed by Dr. Nick Riviera, a famous veterinarian who is renowned for his heartwarming books about animals with rabies

http://mywebspace.wisc.edu/rkamath/ The Basic Elements of Effective Advertising Single minded: It grows out of a single strategy Intrusive: It can get and hold viewer or reader’s attention Informative: It imparts information Relevant: The execution is relevant to the core idea Campaignable: It can become a campaign Unique: The advertising is a unique execution of the core idea. If possible, it should be ownable by the product or service. Contagious: Spreads easily and people want to spread it

http://mywebspace.wisc.edu/rkamath/ Tips for Evaluating Ads Remember, it is not what you “like”, it is how well it fits the strategy. The further you are away from the desired target, the more important it is to separate yourself from you personal biases when evaluation creative. The Creative Strategy is your rubric for evaluation.

http://mywebspace.wisc.edu/rkamath/ Address these questions as your give comments to your agency. 1. What is the selling idea? (what is it communicating about the product/people) 2. Is the ad on strategy? (Is it what I want to communicate) 3. How well is it executed? 4. What is the main idea, net impression, the core idea? 5. Perceptions, target, objective, benefit, support? 6. Does it meet the basic elements of advertising? Steps in Articulating Feedback

http://mywebspace.wisc.edu/rkamath/ notes on exam  50 multiple choice  Bring picture ID  Bring #2 pencil  Know your section number!  No notes, books, etc.  Please don’t talk/text/call people/telepathically communicate during the exam

http://mywebspace.wisc.edu/rkamath/ notes on exam  When is the exam?  IN LECTURE!!  What will it cover?  Chapters 7-12

http://mywebspace.wisc.edu/rkamath/ test prep 1. Which of the following statements about single- and limited- line stores is TRUE? a. Many are small, with high expenses relative to sales b. They usually believe in a "buy low and sell high" philosophy c. Such stores face the costly problem of having to stock some slow-moving items in order to satisfy their target markets d. Most conventional retailers are single- or limited-line stores e. All of the above are true

http://mywebspace.wisc.edu/rkamath/ test prep 2. Why would you use qualitative research? a.Less work b.Detailed responses c.Easy to analyze d.Aggregating responses is easy e.Respondents are not limited in how they can answer f.Doesn’t require much time g.Can generate insights that other types of research can’t h.Easy to research a large sample size

http://mywebspace.wisc.edu/rkamath/ test prep 3. Franchise operations provide a good example of: a.Vertical integration b.Contractual vertical marketing systems c.Administered channels in which the retailers are the channel captains d.Direct-to-buyer channels e.None of the above

http://mywebspace.wisc.edu/rkamath/ test prep 4. There are five steps to marketing research. What is the correct order? a.Define the problem b.Analyze situation c.Get problem-specific data d.Interpret the data e.Solve the problem It’s already correct!

http://mywebspace.wisc.edu/rkamath/ test prep 5. Which of the following is an example of derived demand? a) it turns out that caffeine causes cancer so people start drinking watered-down Kool-Aid instead of coffee b) Soulja Boy has started wearing mascara, so mascara sales in the male population is skyrocketing c) Asparagus grows well in the spring, so farmers are selling a lot of asparagus to grocery stores, and people are buying it because it’s cheap d) Scientists have discovered that moldy cheese cures acne. Teenagers are now buying so much cheese that milk prices are at a 27-year high e) Seventeen magazine printed an article discussing the health benefits of smoking, and now cigarettes are cool again

http://mywebspace.wisc.edu/rkamath/ test prep 6. I go to a store and see 400 different models of televisions that pretty much have the exact same features. I just choose the cheapest one. I see televisions as: a.homogeneous shopping products b.want-based shopping products c.specialty shopping products d.heterogeneous shopping products e.indistinct shopping products

http://mywebspace.wisc.edu/rkamath/ test prep 7. Which best typifies the Battle of the Brands? a.Kraft macaroni vs. Hormel macaroni b.Kraft macaroni vs. Kraft shells & cheese c.Kraft macaroni vs. Olive Garden restaurant’s macaroni d.Kraft macaroni vs. homemade made-from-scratch pasta e.Kraft macaroni vs. Wal-Mart brand macaroni

http://mywebspace.wisc.edu/rkamath/ test prep 8. If Markle Appliance Manufacturing Co. has 65 different models of product all branded with the name Elkram, Elkram is a: a.Brand pool b.Brand line c.Brand extension d.Family brand e.Generic brand

http://mywebspace.wisc.edu/rkamath/ test prep 9. Discrepancies of assortment is applicable to which of the following? a.a manufacturer pumps out 80 billion dog toys a year, but most people only buy one at a time b.Sephora makes 4,000 different types of makeup and they sell them all at their own Sephora stores c.Univox makes Superfuzz guitar distortion pedals but they are sold at music stores next to patch cables, picks, and strings d.Arcturus Steel makes ball bearings in the trillions but sell them to hardware stores who package them into quantities of 500 e.A company makes golf clubs, golf pants, golf balls, golf hats, golf grips, golf gloves, and golf videos. They sell these directly to golf dudes by mail order.

http://mywebspace.wisc.edu/rkamath/ test prep 10. Aarfy’s sells scrambled merchandise, which means: a)they create a unique shopping environment by mixing all different types of products on a single shelf, so you never know what you’ll see next b)they try to carry as many brands as they possibly can for any given category c)they’ll sell anything to make a quick buck d)they ‘scramble’ (hide anti-theft devices) on their product packaging to thwart shoplifters e)they make amazing omelettes (yes, really)

http://mywebspace.wisc.edu/rkamath/ test prep 11. Modern warehouses have been moved out of downtown areas, which means that they are horizontal more than vertical. Therefore these modern warehouses don’t usually use: a)Freight elevators b)Power-lifts c)Motor-scooter d)Roller-skating order pickers e)Electric hoists f)Hydraulic ramps g)A and D h)D and F i)All of the above old ware hous es were vertic al New warehouses are horizontal

http://mywebspace.wisc.edu/rkamath/ test prep 12. Which of these can be considered part of a retailer’s “product”? a)The sales staff b)The décor c)The variety of stuff they sell d)Reputation e)Where the store is located f)Their advertisements g)Their clientele h)The salespeople are supposed to smile when they greet you, and if they don’t you get everything you can shove into a brown paper sack for free everything except f) and g)

http://mywebspace.wisc.edu/rkamath/ test prep 13. Suppose the words Xerox, Kleenex, and Band-Aid are now in the public domain. It’s because: a)These brands invented the categories they are in b)The companies didn’t register their name under the Wheeler-Lea Act c)Each of them at some point let their registrations under the Wheeler-Lea Act expire d)It has been over 70 years since their inception, and so they can no longer be listed as trademarks under U.S. Law e)The owners did not bother to keep people from using those words synonymously with the category

http://mywebspace.wisc.edu/rkamath/ test prep 14. Which of the following is NOT a regrouping activity? a)Accumulating – collecting products from many small producers b)Bulk-breaking – Dividing larger quantities into smaller quantities c)Sorting – Separating products into grades and qualities d)Shifting – Moving products from separate locations to a single location e)Assorting – Putting together a variety of products

http://mywebspace.wisc.edu/rkamath/ test prep 15. The CEO of Morbidly Obese Sandwich Company chain wants to know if people will buy more sandwiches if they pour water all over the floors and make them super slippery at all times. The company is prepared to spend $50,000 on doing market research. The best market research method to test this theory would be: a)Survey b)Observation c)Focus Group d)Experiment

http://mywebspace.wisc.edu/rkamath/ test prep 16. A bicycle company that is experiencing weakening sales of their year-old bicycle model wants to drum up sales this summer. They decide to take the remaining stock, slap some training wheels on them, and sell them as “New and Improved.” Will the FTC allow this? a)Yes, but only for 6 months b)Yes, because bicycles do not fall under the FTC’s jurisdiction, cf. Lehmann- Kohler Act 10:12-26. c)No, the bikes haven’t been significantly changed d)No, the bikes are more than 6 months old so they can’t be sold as new e)There’s not enough information to tell they are functionally different

http://mywebspace.wisc.edu/rkamath/ test prep 17. The Lanham act covers what area? a)Unfair competition b)Price gouging c)Monopoly d)Copyright e)Breaking and entering

http://mywebspace.wisc.edu/rkamath/ test prep 18. Two months ago, no one knew what a ROFL-Maker was, but now every single undergraduate at UW-Madison has one. LOLology, Inc., company that makes the ROFL-Maker is now facing competition from a few competing products, like the Chairman LMAO doll, the LOLwat, and the WTF!!!1111. What phase is this category of products likely in? a)Market introduction b)Market growth c)Market maturity d)Market decline e)Market saturation

http://mywebspace.wisc.edu/rkamath/ test prep 19. The single most important things you can do to avoid creating a product that is likely to fail is to: a)Gain the partnership of retailers before doing anything b)Maintain TQM practices within the operational facility c)Ensure that the product passes through the marketing pipeline before it goes to the larger organization d)Make sure the product offers a unique benefit e)Be able to provide an awesome warranty

http://mywebspace.wisc.edu/rkamath/ test prep 20. Your employer, Third Derailleur Bicycles is teetering on the brink of bankruptcy. You need some secondary data about the market in Madison, but you can’t afford to pay much for it. You may be able to get it cheaply from: a)Company files b)The Bicycle Sales League, a trade association for bike shops c)Various sources on the Internet somewhere d)The government will probably have something e)You might be able to get this kind of data CHEAPLY from any of these sources f)Such data, unfortunately, is rarely cheap; it’s unlikely that you can CHEAPLY get it

http://mywebspace.wisc.edu/rkamath/ test prep 21. Johnny Generic runs an unpopular blog in which he discusses all the latest news in the world of pork rinds. He eats them all day every day. Even though he’s familiar with all the brands of pork rinds, he buys whichever one is cheapest. One day, when he’s in a gas station, he sees a bag of Exploding Hearts brand pork rinds. Which describes Johnny’s relationship with this brand? a)brand indifference b)brand obsession c)brand recognition d)brand preference e)brand rejection

http://mywebspace.wisc.edu/rkamath/ test prep 22. The Cockroach Preservation Society collects roaches from many different insect farms. Billions of them are brought to a single roach warehouse before they are sold in bulk quantities to restaurants across the country. What type of regrouping activity is this? a)Bulk-breaking b)Sorting c)Retailing d)Accumulating e)Collecting

http://mywebspace.wisc.edu/rkamath/ test prep 23. Which of the following exemplifies primary demand? a)A company making database management software explains why you’d want to manage data b)A company that makes leather car seats sends out videos to car companies about the high quality of their materials c)A pizza restaurant sells appetizers that make you want the pizza even more d)When people buy dog biscuits, it makes them want to buy a dog e)The biggest search engine company in the world pretty much defines the search engine category

http://mywebspace.wisc.edu/rkamath/ test prep 24. The idea that when retailers enter the market, they come in as low- margin businesses that only after time begin to make profit and are able to offer new services is: A.the wheel of fortune theory B.the wheel of marketing theory C.the wheel of retailing theory D.the wheel in the sky theory E.the wheels on the bus theory

http://mywebspace.wisc.edu/rkamath/ test prep 25. A limited line store (Thoth’s) and a single line store (Seeble’s) are in competition. Which of the following could best describe them? A. Thoth’s sells pizzas; Seeble’s sells ovens B. Thoth’s only sells Colombian neckties; Seeble’s sells menswear from everywhere C. Thoth’s sells animatronic dinosaurs; Seeble’s repairs animatronic dinosaurs D. Thoth’s sells pleather goods; Seeble’s sells only pleather belts E. Thoth’s sells greasy fried foods that are covered in sauce and which sit under a heat lamp all day; Seeble’s also sells greasy fried foods that are covered in sauce and which sit under a heat lamp all day

http://mywebspace.wisc.edu/rkamath/ test prep Know the difference between horizontal and vertical relationships. Why would you get public warehouse vs. a private one? Why do new products fail? What’s involved in inventory costs? When shipping, what’s the best method? – there is no universally optimal method! It depends on what you’re sending and to who.

http://mywebspace.wisc.edu/rkamath/ exam review  This exam review couldn’t possibly cover everything.  Read the book chapters, take the quizzes on the website.  The quizzes on the website will likely help you.  You probably should do the quizzes on the website.  DO THE WEBSITE QUIZZES!  Any specific questions?

http://mywebspace.wisc.edu/rkamath/ Any other questions? ?

http://mywebspace.wisc.edu/rkamath/ Good luck on the exam!

http://mywebspace.wisc.edu/rkamath/  What is marketing research? How does it differ from a marketing information system? Who should be involved in defining marketing research problems and issues?  What are the differences between qualitative and quantitative research? Know when various qualitative and quantitative techniques should be used. Be able to recognize an experiment.  What are the 5 steps of the marketing research process? Be able to recognize each step and identify which of the steps is the most important.  What is the difference between primary and secondary data?  Know the definitions of sample, population, validity and hypotheses. Chapter 7: Concepts

http://mywebspace.wisc.edu/rkamath/ Chapter 8: Marketing Research Marketing research steps – 5 steps 1.Identify problem – symptoms are not the same as a problem 2.Analyze situation – what information do you already have? ask others, secondary data, internet, databases, government data THEN determine what else you need 3. Get problem specific data through 4 types of research Quantitative-structured responses, can be tabulated surveys (telephone, personal, online) Qualitative-in depth, open ended focus group interview Observation – analyze how people shop or use product consumer panels, people meter Experiments - compare results of groups similar except for one characteristic 4. Interpret Use statistical packages, decision support systems Is sample representative of population and valid? 5. Solve problem Use information to recommend and implement solution

http://mywebspace.wisc.edu/rkamath/  Know the definition of a product and be able to identify how products differ from services.  What are the consumer product classes, the business product classes (hint: see tables 8-3 and 8-4) – what are they based on?  What is the difference between a product line and a product assortment?  What is the difference between primary demand and derived demand?  What is a brand, what factors contribute to successful branding? When do you use “family” branding? What constitutes a good brand name? Chapter 8: Concepts

http://mywebspace.wisc.edu/rkamath/  What is a trademark or a service mark?  What is the battle of the brands?  What is required when a warranty is offered?  Be able to recognize the 5 levels of brand familiarity. Chapter 8: Concepts

http://mywebspace.wisc.edu/rkamath/ Chapter 9: Product management 4 Stages of the Product Life Cycle – Market introduction, market growth, market maturity, market decline New product for a company: a completely new product or variations on an old product New product for FTC standards: entirely new or changed in a “functionally significant or substantial respect” – Company can use term “new” for 6 months  Consumer Product Safety Act (1972) -Promotes safety in product design -Sets safety standards -Can demand recalls and repairs for products -Penalties for negligent companies: fines, jail sentences  Product Liability – legal obligation of sellers to pay damages to individuals injured by defective or unsafe products

http://mywebspace.wisc.edu/rkamath/ Chapter 9: NPD process  Idea generation – Collect ideas from within company, market research, competitors  Screening – Find strengths and weaknesses, market trends, ROI estimate  Idea evaluation – Concept testing, reactions from customers, estimates of costs & profits  Development – R&D, develop model or service prototype, test marketing mix  Commercialization – finalize product and marketing plan, start production, roll out

http://mywebspace.wisc.edu/rkamath/  What are the stages of the product life cycle, what happens with volume and profit in each, how do marketing plans differ in each stage?  What is concept testing- at which stage do you employ it?  What constitutes a new product according to the text, and according to the FTC?  Rate of and reasons for new product failure. What are the steps in the new product development process?  What is liability? What do “unsafe” and “defective” mean? What is the role of the CPSC (Consumer Product Safety Commission)? Chapter 9: Concepts

http://mywebspace.wisc.edu/rkamath/ Chapter 10: Place and Channels Channels can be either direct or indirect Discrepancy of quantity: Difference between the amount a firm wants to make to achieve economies of scale and what a consumer wants Discrepancy of assortment: Difference between the variety a firm makes and what a consumer wants Distribution systems: – Intensive: Selling a product through everyone who will stock the product Examples? – Selective: Selling only through middlemen who will give product special attention Examples? – Exclusive: Selling through a single middleman in a certain geographic region Examples? – Know when to use each system

http://mywebspace.wisc.edu/rkamath/  What is a channel of distribution?  What are the definitions of and reasons for using direct vs. indirect distribution?  What is meant by discrepancies of quantity and discrepancy of assortment? Be able to recognize the main regrouping activities.  What is reverse distribution?  What is the difference between intensive, selective and exclusive distribution, when are they used?  What is meant by horizontal and vertical integration?  When are distribution arrangements illegal?  What is meant by channel conflict? Under what conditions is channel conflict likely to occur? Chapter 10: Concepts

http://mywebspace.wisc.edu/rkamath/ Chapter 11: Logistics Logistics includes: 1) transport 2) storage 3) handling of goods Goal is to meet (but not exceed) customer needs Customer service level = desired speed/dependability of delivery Consider tradeoffs between 1) costs, 2) sales, 3) service level Decisions and alterations have systemic effects Transportation Tradeoffs: Water, Pipeline, Rail, Truck, Air  cheap/slow –––––––––––––––––––––––– expensive/fast  Proportion of transport cost decreases as cost of product increases Warehousing: Private (own/lease) vs. Public (rent)  expensive/control –––––––––––––––––––––––– cheap/flexible  Warehousing (store) vs. Distribution (get product out)

http://mywebspace.wisc.edu/rkamath/  What is the physical distribution (PD) concept?  What is meant by the “total cost approach” to physical distribution?  What is “just in time” distribution? Understand the main transportation options and the pros-and cons of each.  What is the difference between a public warehouse, a private warehouse and a distribution center? How is distribution related to customer service? Chapter 11: Concepts

http://mywebspace.wisc.edu/rkamath/ Chapter 12: Retailers, Wholesalers, & Their Strategy Plan Retailing – Covers all of the activities involved in the sale of products to final consumers – Features of retailer’s offerings that relate to: Economic needs: Convenience, Product selection, Special services, fairness in dealings, helpful information, prices Social/emotional needs: Social image, shopping atmosphere Types of retailers – General stores, single-line (limited-line), specialty shops, department stores, a discount houses, mass merchandisers, convenience stores, supermarkets, supercenters, convenience, and vending machines. Online vs. in-line retailers and customers – Exhibit 12-3

http://mywebspace.wisc.edu/rkamath/ Chapter 12: Retailers, Wholesalers, & Their Strategy Plan Wheel of retailing – Says that new types of retailers enter the market as low- status, low-margin, low-price operators and then, if successful, evolve into more conventional retailers offering more services with higher operating costs and higher prices…then threatened by new low-status, low-margin, low-price retailers - - and the wheel continues Retail life cycle Mass-merchandising concept Scrambled merchandising Difference between merchant wholesalers and agent middlemen: – Merchant wholesales own merch., agent middlemen don’t

http://mywebspace.wisc.edu/rkamath/  What are features of a retailer’s product?  How do customer needs relate to a retailers offering?  What are specialty shops, department stores, a discount houses, mass merchandisers, convenience stores and vending machines? Know differences between online and in-store retailers and customers.  What is meant by the “wheel of retailing”? Know trends on retail life-cycles.  What is the mass-merchandising concept? What is meant by scrambled merchandising? What is the difference between merchant wholesalers and agent middlemen? Know key merchant wholesalers such as drop shippers and rack jobbers. Chapter 12: Concepts

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