1. BUSI 406 Principles of Marketing Class 1

2. Today’s Agenda Review class syllabus Introductions Discussion about:
What is Marketing?
Why is Marketing important?
Who does Marketing?

3. Course Objective
To provide a broad overview of marketing, with a focus on:
Key marketing concepts
The role of marketing in society and the firm
Factors that influence marketing decision making
Learning the “language of marketing”
Marketing strategy planning

4. Course Goals By the end of the course, you will understand:
How to make major marketing decisions
How to apply key frameworks and tools to analyze customers, competition and company’s strengths and weaknesses (3C’s, SWOT)
How to select target markets
How to make decisions related to product, price, promotions, and place to meet the needs of a target market (4Ps)
Marketing Strategy Planning
How is all comes together…Finding attractive opportunities and developing sustainable marketing strategies by identifying a target market, crafting the 4Ps, and showing it will work with a profit-loss statement (a plan without a budget is not a plan)!

5. Marketing Strategy Planning involves:
What is Marketing Strategy Planning? Finding attractive opportunities and developing sustainable marketing strategies, and being rewarded for doing so.
Marketing Strategy Planning involves:
3C’s: Company, customers, competitors SWOT analysis
Marketing Strategy: Specifying a target market and a related marketing mix
Target Market: a fairly homogenous group of customers to whom a company wishes to appeal
Marketing Mix: the controllable variables (4 P’s) the company puts together to serve this target group
Product
Place
Price
Promotion and communication
Pro forma Budget: A plan without a budget is not a plan, show me the numbers, expected revenues against expected expenses, plus other outcome metrics
Summary Overview
Marketing strategy planning means finding opportunities and developing profitable marketing strategies that the company can use to capitalize on them.
Key Issues
Marketing strategy--specifies a target market and a related marketing mix; provides “big picture” of what the firm will do.
Target market --a fairly homogeneous (similar) group of customers to whom a company wishes to appeal.
Marketing mix--the controllable variables the company puts together to satisfy the target market.
Discussion Question: Why doe the customer (C) appear in the center of the diagram of a marketing strategy?

6. Class Format Lectures Class Discussions Videos Guest Speakers
Question & Answer
Case Discussion
Current Event Articles
Videos
Guest Speakers
Class is ONLY AS GOOD
as YOU MAKE IT!!

7. Our Textbook Title: Essentials of Marketing
Authors: William D. Perreault, Jr., Joseph P. Cannon, E. Jerome McCarthy
Edition: 15
Available at UNC Bookstore and elsewhere

8. Additional Reading
Cases are in the back of your textbook
Current Press Articles
Some articles will be assigned to be read for homework
It is important that you read the assigned readings thoroughly before coming to class!

9. Grading Course Component % of Course Grade Class Participation 10%
Research Requirement 5%
Three Written Case Assignments
(5% Each)
15%
Class Project/Presentation
(Project 15% and Presentation 5%)
20%
Exams
(First Exam 10%, Second Exam 15%, and Final Exam 25%)
50%
Total
100%

10. Class Participation It is important that you come to class prepared!
I encourage you to actively participate in class discussions.
There are no wrong answers. There are no stupid questions. Participate!
I want everyone to be involved in class discussion!!!
Kenan-Flagler marketing classes are participation sports, not spectator sports!

11. Class Participation
All constructive participation will be rewarded in your final grade.
Evaluating class participation:
Is the participant a good listener? Is there a willingness to participate?
Are the points made--or questions raised--relevant to the discussion?
Do comments show evidence of thorough analysis of the assignment?
Overall, do comments contribute to our understanding of the discussion? Do they move the class forward?

12. Research Requirement
3 hours of academic research participation is required of all students enrolled in BUSI 406
Two ways to complete this requirement:
Participate in 3 hours of academic marketing research
Write 3 two-page summaries/critiques of academic marketing articles
Please see “Research Requirement Information” Handout to create an account
More information to follow in the coming weeks…

13. Written Assignments
There will be 3 assignments due throughout the semester.
All three are team case analyses.
2 Typed Page Max limit, plus Exhibits - please respect this page limit, and use 12 point font, 1 inch margins
Write-ups should reflect your team’s thinking and key ideas about the case, not just a summary of the "facts" presented in the case.
We will discuss the assignments in class the day they are due.

14. Team Class Project/Presentation
At the end of the term, your team will be asked to submit a comprehensive marketing strategy plan to start or significantly improve a business / nonprofit / campus organization and present your marketing strategy plan to the class.
Written Marketing Strategy Plan – up to 5 pages, plus exhibits
Presentation - 10 minutes max, including Q & A
Powerpoint or other presentation method

15. A Quick Word On Teams… On Monday, January 23, we will form teams.
Teams should consist of 4 to 5 members.
With your team, you will complete the three team written assignments as well as the major class field project and presentation.
Please be a good team member! Your team is only as strong as you make it!

16. Exams There will be two mid-term exams and one final exam.
All exams are closed book, closed notes exams.
Exams will consist of multiple-choice questions as well as a few short answer/essay questions.
You will be asked to pick the best answer. However, if you think that a question is ambiguous or that more than one answer is appropriate, you can write a brief explanation of your logic and answer. You will be given credit if your explanation reveals your understanding.

17. Exams
All course material is fair game! This means that material from class discussions, the textbook, and supplemental readings will appear on the exams.
The exams will focus on material we cover in class prior to the exam. For example, the focus of the Second Exam will be the materials covered after the First Exam and before the Second Exam. That said, some material builds on prior material - you will be expected to know such material for the final exam.

18. Exams
Graded exams will be returned as quickly as possible. We will briefly discuss questions and issues that proved to be more difficult in class. Your exams will be collected at the end of the discussion. However, you are welcome to come by at any point to review your exam in more detail if you wish.
You must have prior approval to take an exam at a time other than the scheduled exam dates.

19. UNC Honor Code
The UNC Honor Code shall be upheld throughout the course.
Academic honesty and trust are important to all of us as individuals, and they are encouraged and promoted by the honor system.
We take honor code seriously, and expect you to do so as well.
To eliminate any possible confusion, we expect you to do your own work.
At no time should notes or papers or personal consultations or another student’s answers be used to complete an individual deliverable or any of the exams.
Doing your own work included being an active and responsible member of your team.

20. Schedule of Course Assignments
It is your responsibility to keep up with all course assignments.
If you are unsure of what the assignments are for any class or what I expect in terms of preparation for any class, please do not hesitate to ask.
Please look over the course schedule
If the schedule changes for any reason (rescheduling of speakers, needing more time for topics, etc., I’ll let you know)

21. About You… Who are you, what is your hometown?
What brings you to KFBS and BUSI 406?
What would you like to do in the future?

22. What is Marketing? What do you think “Marketing” is?
What words come to your mind when you hear “Marketing”?
What types of decisions do you think marketing managers need to make?

23. What’s Marketing?
(A whole lot more than just selling and advertising!)
Marketing is an organizational function and a set of processes for creating, communicating, and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders.  American Marketing Association

24. Marketing’s Goal is to Identify Opportunities, Provide Goods and Services that Exceed Customer Expectations and Create Customer Satisfaction, and to be Rewarded Financially for Doing So
How?
By creating value for customers by satisfying their needs and wants
Marketers want customers to demand their products!

25. Why Companies Care About Satisfied Customers?
Satisfied customers are loyal - migrate to competitors at a rate of 5%
Refer company to others - tell an average of 3 others about their good experiences
Social media = positive “word of mouth” on steroids!
Are less price sensitive (are willing to pay more!)
Making customer satisfied is critical is retaining them.
Ex. Buzz Marketing

26. Why Companies Care About Dissatisfied Customers?
Dissatisfied customers stop buying and churn - migrate at a rate of 40%
Don’t complain to the firm - 96% never report it (Didow and Fornell)
Do complain to others - tell on average 11 others about their problems (social media = negative “word of mouth” on steroids!

27. Lifetime Value of a Customer – Losing A Customer Can Be Expensive!
If Honda does not sell 10 vehicles,
It loses $20,000 per vehicle.
So 10 vehicles x $20,000/vehicle
Equals a gross revenue loss of $200,000 !!!

28. Losing A Customer Can Be Expensive!
If McDonalds loses one customer that would have been a customer for 25 years,
It loses $10/visit x 30 visits/year or $300/year.
So over 25 years x $300/year
Equals a gross revenue loss of $7,500 !!!
From losing just one customer – lifetime value of a customer...

29. Losing A Customer Can Be Expensive!
If GAP loses one customer that would have been a customer for 20 years,
It loses $500/year.
So over 20 years x $500/year
Equals a gross revenue loss of $10,000 !!!
From losing just one customer...

30. Is Marketing Important To YOU?
Marketing is important to everyone!
Be an informed consumer.
It’ll be important for your job – whatever you do.
Marketing affects economic growth and the quality of life for all.
IT’S IMPORTANT FOR EVERYONE: It is important for everyone to learn about marketing because it affects you everyday life. The things you buy, the stores you shop in, the radio and TV shows you enjoy are all created by marketing.
Marketing is a part of your life (resume, job interviews, getting your ideas across in job, etc.)
You (as a consumer) pay for the marketing activities – so understand what is going on.
MARKETING IS IMPORTANT TO YOUR JOB: Career opportunities – marketing jobs is often a good route to the top (See Appendix C in Bill’s book)
Knowing about marketing will help you interact with the marketing people
Marketing belongs in all organizations, non-profit as well as for profit or institutions, politicians, etc. (many of the same techniques are used)
MARKETING AFFECTS ECONOMIC GROWTH: Marketing affects the economy – if marketing is done well, consumers will be offered that meet needs/wants of consumers.
Marketing gives consumers a choice, and marketing (through research and development (ideas)) allow consumers to purchase better products (as defined by these consumers).

31. Today’s Take-Aways
Marketing is a process centered around the consumer.
Must understand consumer’s needs, wants and demands
Goal is to exceed customer expectations and create customer satisfaction
If we don’t satisfy our customers, the financial impact is HUGE.
Everyone “does” marketing.
Point 1: Centered about identifying and finding ways to satisfy consumer needs
Point 2: 4 P’s: Product, Price, Place, Promotion
Point 3: 90% perspiration, 10% inspiration

32. For Next Class… No class on Monday, January 16
On Wednesday, January 18, we’ll continue today’s discussion
Please review class syllabus, schedule and research participation requirement handout carefully
If you have any questions, please ask at the start of class on Wednesday.
Read chapter 1 in textbook
Chapter 1 – Marketing’s Value to Consumers, Firms and Society