Chapter 9 Summary: Crafting the Brand Positioning and Competing Effectively

           Chapter 9 discusses the various ways to compete for majority market share and ways to protect market share. Some companies choose points-of difference and points-of parity to distinguish their brand in the overall market. The text mentions Southwest Airlines and I’d like to take a closer look at this company and how they distinguish and compete against the other airlines.

           

            Southwest is a fantastic example of setting yourself apart from other brands and emphasizing a product or service you offer that none of your competitors can provide. Many years ago, Southwest re-vamped their entire airline but setting insanely high standards in customer service and also by advertising “bags fly free.” All other airlines are still charging for each checked bag, many charge about $25 per bag and even to this day, Southwest does not charge for luggage. These services are points-of-difference. Southwest has advertised so much that consumers know they have good customer service but sometimes that is not enough. Purchasing a plane ticket is expensive and consumers are looking to save a few bucks these days, so no bag fees also sounds perfect. After doing some research, Southwest recently tried a new advertising campaign and my guess is this is a market-challenger strategy to protect and increase market share.

            The text defines a frontal attack as, “the attacker matches its opponent’s product, advertising, price, and distribution. A modified frontal attack, such as cutting price, can work if the market leader doesn’t retaliate, and if the competitor convinces the market its product is equal to the leader’s” (Kolter 138). In Southwest’s latest campaign, they focus on being America’s largest domestic airline. They also stray away from humor or emphasizing the bags fly free promotion and instead they focus on the American dream. I believe this is a great example of challenging the other top three airlines and expanding the brand.

            

            In conclusion, there are several ways to increase and protect market share but it is very important that the brand stay in tact and choose the best strategy for that company. In the end, effective positioning will make all the difference in the success or failure of a marketing plan.

Sources: Kotler, Philip, and Kevin Lane Keller. A Framework for Marketing Management. 5th ed. Boston: Prentice Hall, 2012.           

http://business.time.com/2013/03/26/southwest-airlines-were-not-really-about-cheap-flights-anymore/

Chapter 8 Summary: Creating Brand Equity

            I was once asked in an interview for a marketing position, “how would you describe our brand?” Looking back, that is one of the most important questions that could be asked of a marketing candidate. For one, it shows if the interviewee did their homework about the company but it also gives the interviewers an in depth and fresh perspective about their brand from a marketing professional.

            Creating, developing, maintaining, and enhancing a brand is a very tough job but it is critical in the success of any company. Take for example, the “Coke” brand and it’s red logo; everyone across the planet knows what that little red circle means. Coke probably even has their own pantone color for that bright shade of red with white lettering, in an unmistakable font. The logo brings images of summer and chilling outside with your friends. For some, it brings back the memories of the “good ole days.” For others, their mouths start watering and it’s almost like you can taste and smell the delicious carbonated beverage. Through their logo and advertising, Coke has established brand equity. The Coke brand sets the product apart from its competitors and has created loyalty to the product over the years. According to www.insidermonkey.com, Coca-Cola sells more than $125 million per day and the brand is worth more than $74 billion. 

            Another good example of a famous brand that has displayed brand equity and reinforcement over the years has been McDonalds’ golden arches. The brand itself is more than just the logo of two arches forming an “M,” it is also about the fact that McDonald’s has dominated the fast food market all over the world. It symbolizes a fast, hot, and cheap meal while on the go. McDonald’s corporation has reinforced the brand through their advertising and proved valuation because today the brand is work $95 billion. (www.insidermonkey.com)

            In my opinion, being able to describe a brand, more than just the logo, is valuable. It means the company is doing something right. It also means that all of their marketing pieces and advertisements are similar and reinforce the brand. Understanding a company’s brand is necessary to be a successful marketing professional.

Source: Kotler, Philip, and Kevin Lane Keller. A Framework for Marketing Management. 5th ed. Boston: Prentice Hall, 2012.           

http://www.insidermonkey.com/blog/the-coca-cola-company-ko-mcdonalds-corporation-mcd-the-worlds-most-valuable-brands-146167/

Chapter 7 Summary: Identifying Market Segments and Targets

           All consumer markets are segmented based on four main areas: geographic, demographic, psychographic, and behavioral. It’s important for markets to be segmented so that a business knows how to target their specific market and also to determine if they want to market a product on a larger scope or be more specific.

           Geographic segmentation is pretty basic in that it breaks down markets based on location, whether it is nation or neighborhood. Geographic segmentation also takes in to account race and ethnicity. The first example that comes to mind is the Asian district in Oklahoma City. The restaurants and grocery stores all have an Asian influence, even in the architecture of the McDonald’s. The reason for this niche market is the densely populated area, predominately consisting of Asians.

            The next segmentation is demographic. Factors of this market segmentation include family size, gender, occupation, income, and generation. An example of a product or service in this category might be nursing homes for older generations or a specific tennis shoe for women, or health insurance that is the same price for a family unit, regardless of how many kids they have.

            The third market segment is psychographic, meaning “the science of using psychology and demographics to better understand consumers.” (Kolter 103). In this category, people are grouped into personality traits, lifestyles, and values. A target product for this market might be fictional books, non-fiction books, Bibles, magazines covering different subjects, etc.

           

        The fourth market segmentation is behavioral and this includes needs and benefits, decision roles, and user and usage. One example would be the use of occasions in purchases such as the need to purchase airfare for vacations. People typically buy Christmas decorations in December and graduation gifts in May. Targeting consumers with sales and coupons during these specific times will likely result in additional purchases because they are already thinking about buying these things during certain occasions.

          Knowing your segmented market and where your product falls into place is critical when developing a marketing plan. Understanding your consumer and their demographics, personality, and behavior will all attribute in the best way to market the product.

Source: Kotler, Philip, and Kevin Lane Keller. A Framework for Marketing Management. 5th ed. Boston: Prentice Hall, 2012.                       

            

Chapter 6 Summary: Analyzing Business Markets

         Marketers need to know how to market to individual consumers but also how to market to the organizational and government buyers. Organizational buying is defined as, “ the decision-making process by which formal organizations establish the need for purchased products and services and identify, evaluate, and choose among alternative brands and suppliers.” (Kolter 86). 

          A business or organization will make different purchases than an individual consumer. A hospital for example, will buy medical supplies in bulk and they are looking for the best bid and best experience with the medical supplier. It’s also important that a supplier be able to meet the needs of the business and have extra stock ready to deliver at the drop of a hat.

         “A business market consists of all the organizations that acquire goods and services used in the production of other products or services that are sold, rented, or supplied to others. The major industries making up the business market are agriculture, forestry, and fisheries; mining, manufacturing; construction; transportation; communication; public utilities; banking, finance, ad insurance, distribution, and services.” If a company spends too much on the products that they use to make their product, then it reduces their net profit. A marketer for the business market must know their customer specifically and be extremely competitive in order to win the bid.

            The institutional market consists of schools, hospitals, nursing homes, and other institutions that provide goods and services to people in their care. Marketing to institutions is unique because they are usually on a limited budget and they are looking for the best bang for their buck, which sometimes means sacrificing quality. Government markets are affected buy region or locations and have close relationships with the suppliers because they usually only use a few suppliers and need to maintain tight security.

          Marketers must be aware of the unique needs of businesses and their buying processes. The only difference between business buying processes is the product specification and the proposal solicitation.

Source: Kotler, Philip, and Kevin Lane Keller. A Framework for Marketing Management. 5th ed. Boston: Prentice Hall, 2012.                        

Chapter 5 Summary: Analyzing Consumer Markets

           Understanding how people think and their buying process will help any marketing professional to better reach their target consumers and encourage sales. There are several factors that influence consumer behavior but they are broken down into three main categories: cultural, social, and personal factors.

            Cultural factors are the main influence in a person’s buying process. The way you were raised by your family, religion, racial groups, and social class all belong to the cultural factor. Social factors are the second important consideration in the buying process. Groups that you are a member of such as religious, professional, clubs, neighborhoods, etc. are all included in this group. Groups that you choose to be a part of, hope to be a part of, or groups you choose not to be a part of are also all considered social factors. An example would be if a person belongs to a smoking or non-smoking group. The fact that they smoke or not would affect their buying of not only cigarettes, but even where they chose to eat or if they chose to buy something from someone who smokes because the item might smell. Lastly, there are personal factors such as age, stage of life, occupation, and personality. I may not chose to by a RV but someone in the baby boomer generation might because either they are retired or close to being retired and have the time to go camping.

            The chapter also discusses the buying decision process. There are five stages: problem recognition, information search, evaluation of alternatives, purchase decision, and post purchase behavior. I’ll walk you through an example of my latest purchasing process. We recently bought a house and decided that the sectional couch we have was not suited for our living room. It didn’t fit properly and didn’t look like it belonging in the living room because of it’s style and age. Therefore, we recognized the problem; we need a new couch.

             I started doing some research online and looking at furniture stores to get an idea of what I was looking for. I knew that I didn’t want microfiber again because my dogs nearly ruined the other one and I wanted something more durable. After my information search, I evaluated the alternatives buy looking at leather as an option. I decided I wanted a brown or black leather couch with recliners at both ends and preferably one that had a nail head trim. They started out at least $1,200 for a couch, not including tax, warranty, and delivery. We decided that we were not willing to spend that kind of money because with two dogs and a baby, the couch will not last five years.

        I continued searching and found a used one on Craigslist. It was a $2,500 couch, only three years old and was in great condition because they kept in a formal living room that was hardly ever used. We decided that was the couch for us and purchased it. Post purchase behavior can mean buyer’s remorse or satisfaction in the product you chose to purchase. We are satisfied with our purchase.

         If marketers aim to enhance the buying experience in all of the five steps through information they collect from the consumer then they can create a more effective marketing plan, therefore creating more revenue for the product and increasing customer loyalty.

Source: Kotler, Philip, and Kevin Lane Keller. A Framework for Marketing Management. 5th ed. Boston: Prentice Hall, 2012.                        

Chapter 4 Summary: Creating Long-term Loyalty Relationships

One of the key ingredients in any good marketing plan is acquiring new customers and retaining all of your customers. Building relationships with your customers is vital in this process and important in creating customer loyalty. As consumers, we make decisions on our purchases buy weighing the pros and cons, and evaluating the total value from our viewpoint. “This process is called customer-perceived value (CPV). CPV is the difference between the prospective customer’s evaluation of all the benefits and all the costs of an offering and the perceived alternatives.” (Kolter 54).

The first “real” job I had after I graduated college was as an Emergency Services Assistant for a hospital in Ohio. Part of my job was to work with the company we hired to monitor our customer satisfaction and I was the liaison and trainer for my company. When I first started this job, I thought why in the world would a hospital care about customer service; isn’t it all about taking care of the patients and healing them of their sicknesses?

      Come to find out, you can choose who your doctor is and what hospital to go to when you’re sick. Therefore, we needed to focus on customer service and create loyalty with our patients. Throughout the four and a half years I worked at the hospital, we monitored and improved our customer service responses to a 90% goal. We used the surveys to follow up with patients that had a bad experience and then helped to improve processes or establish new policies in hopes of creating better experiences for our patients.

Another example of using experience and customer service to establish loyalty is my favorite shoe store, Red Coyote Running and Fitness. It is a running store in Classen Curve in Oklahoma City. I had a co-worker that recommended that I buy running shoes at this store but I thought of course it would be expensive. I went to Red Coyote and the guy working there was so helpful. He first had me run on a treadmill barefoot while they videoed my feet while running. He was able to fit me for new shoes, allow me to try them out on the treadmill and outside until I found the perfect pair. Even though they were a little more expensive than Academy, I was willing to pay it because he was so incredibly helpful. Now, my husband and I have bought shoes, socks, clothing, and lights for our stroller. We tell everyone about Red Coyote and recently joined their running club. Thanks to their incredible one-on-one customer service, Red Coyote created a strong and loyal customer base.

 

Customer service is a main priority and should be taken serious in any consumer situation. Once you have loyal customers, whether it’s because of an experience or discount offers, etc. it is even more imperative to keep those customers through strong marketing.

Source: Kotler, Philip, and Kevin Lane Keller. A Framework for Marketing Management. 5th ed. Boston: Prentice Hall, 2012.           

 

Chapter 3 Summary: Collecting Information and Forecasting Demand

           Some people will say that determining the value of marketing efforts and return on investment is nearly impossible, however in many marketing environments, a marketing information system (MIS) can be used.  A MIS, “consists of people, equipment, and procedures to gather, sort, analyze, evaluate, and distribute needed, timely, and accurate information to marketing decision makers.” (Kotler 34).

            Marketing professionals use the information in the MIS to conduct market research. There is a process used when conducting market research. The first step is to define the problem or research objectives. Secondly, the research plan needs to be developed and thirdly, begin collecting the information. After the information is gathered, then it is analyzed and presented to the company’s leadership. Finally, the leadership makes a decision.

            The information collected through research can also be used to forecast a market demand or an estimated plan of how many units will be sold within a particular customer group or demographic. There are six major factors that affect a marketing environment; they are demographic, economic, sociocultural, natural, technological, and political-legal. Concerns such as income distribution and debt and credit availability are examples of the economic factors that affect a marketing demand and trends. Laws and regulations must also be kept in mind when evaluating a market demand.

Source: Kotler, Philip, and Kevin Lane Keller. A Framework for Marketing Management. 5th ed. Boston: Prentice Hall, 2012.                                                                                                            

Chapter 2 Summary: Developing Marketing Strategies and Plans

           This chapter reviews the components and process of a strategic plan. A plan is key in successful marketing. The majority of companies review their strategic goals annually and develop a marketing plan that reflects these goals. A marketing plan simply gathers all of the plans in one place and directs and coordinates the use of marketing to target a specific audience.            

            The company must first determine the corporate mission and then identify strategic business units (SBU). After the SBU’s are identified, then the company leadership determines how the funds will be allocated to each group. Next, the company evaluates where they have room to grow and change to become more effective. The company’s I’ve worked for called them opportunities for improvement (OFI’s).

One way a company evaluates their growth potential is through a SWOT analysis. SWOT is short for strengths, weaknesses, opportunities and threats. This is a good chance for company’s to take a step back and re-evaluate or even have an outside group do your analysis for an even more in-depth projection. Finally, a company would reward the employees that assisted with the development of the plan and proceed to develop the final goals and implement the plan.                        

Source: Kotler, Philip, and Kevin Lane Keller. A Framework for Marketing Management. 5th ed. Boston: Prentice Hall, 2012.                                                                                                            

Chapter 1 Summary: Defining Marketing for the 21st Century

            I used to think marketing was just another word for advertising, however, through my studies and work experience, I’ve learned that it is far more than advertising. Marketing is creative, innovative, and a blend of science and research but more simply put, the text defines marketing by saying, “it is about identifying and meeting human and social needs.” (Kolter 2). Someone has to use marketing to create a customer base and then maintain the loyal consumers and that person’s job is called marketing management.

            There are ten main types of things that are marketed: goods, services, events, experiences, persons, places, properties, organizations, and information. A market isn’t a traditional brick and mortar store but it’s a group of buyers with interest in the same product, service, etc. A market is similar to a club in that everyone in the group has a common thread, in this case it could be a voter demographic or a collection of people that think Crest toothpaste is the best. The goal in marketing is to establish a “club,” maintain and add members, and create loyalty to the “club.” A marketplace is a traditional brick and mortar store and the marketspace is a digital store.

            There are five main types of concepts when it comes to marketing philosophies: the production concept, product concept, selling concept, marketing concept, and the holistic marketing concept. I found the marketing concept to be the most interesting because it is a customer-centered approach that focuses more on creating and developing products to meet customers needs versus trying to find consumers that want your product. A good example of this would be Craigslist.com. This website was created because the use of classifieds ads are declining but people still need a way to buy and sell used items, thus Craigslist was started.

Source: Kotler, Philip, and Kevin Lane Keller. A Framework for Marketing Management. 5th ed. Boston: Prentice Hall, 2012.