1. Marketing: Building Blueprints for Business Marketing: Building Blueprints for Business (Chapter 4)

2. n Many different types of marketers l Packaged goods n Many different types of marketers l Packaged goods && Marketers Advertisers n Many different types of marketers

3. l Packaged goods n Many different types of marketers l Packaged goods && Marketers Advertisers l Durable Goods

4. n Many different types of marketers l Packaged goods n Many different types of marketers l Packaged goods && Marketers Advertisers l Services l Durable Goods

5. n Many different types of marketers l Packaged goods n Many different types of marketers l Packaged goods && Marketers Advertisers l Retailers l Services l Durable Goods

6. n Many different types of marketers l Packaged goods n Many different types of marketers l Packaged goods && Marketers Advertisers l High Tech l Retailers l Services l Durable Goods HP “Maestro” - Goodby Silverstein

7. n Many different types of marketers l Packaged goods n Many different types of marketers l Packaged goods && Marketers Advertisers n But they all have similar methodologies and organizations. l And more l High Tech l Retailers l Services l Durable Goods

8. && Marketers Advertisers n Today we’ll cover… nThe Marketing Function - 5 Ps n The Marketing Department l Organizational Structure l Types of Jobs n The Marketing Process n Challenges for the Future n Questions & Discussion n Today we’ll cover… nThe Marketing Function - 5 Ps n The Marketing Department l Organizational Structure l Types of Jobs n The Marketing Process n Challenges for the Future n Questions & Discussion

9. “Marketing is Everything” n Marketing has become the dominant and often most critical business function n Manufacturing techniques and resources are now less critical, often easy to obtain n Brand equity and intellectual capital are now more critical, harder to duplicate n Business is evolving from manufacture of goods to manufacture of “thinking” n Marketing has become the dominant and often most critical business function n Manufacturing techniques and resources are now less critical, often easy to obtain n Brand equity and intellectual capital are now more critical, harder to duplicate n Business is evolving from manufacture of goods to manufacture of “thinking”

10. “The Five P’s” n Five Critical Marketing Decisions n Product n Price n Place (physical distribution) n Promotion l All types of promotional activities l Advertising, Sales Promotion, PR, etc. n “The Fifth P” l People n Five Critical Marketing Decisions n Product n Price n Place (physical distribution) n Promotion l All types of promotional activities l Advertising, Sales Promotion, PR, etc. n “The Fifth P” l People

11. 1. Product n Product may be “tangible” l Packaged goods l Durable goods n Product may be a service n Product may be a combination n Products are “bundles of benefits” n Product may be “tangible” l Packaged goods l Durable goods n Product may be a service n Product may be a combination n Products are “bundles of benefits”

12. 2. Price n Key part of “value equation” n At the price, product must have some measure of “functional superiority.” n Price must also contain margin l For funding of necessary activities... l and profit n Price can send additional signals n Can be a strategy in itself, or, more likely, part of a strategy n Key part of “value equation” n At the price, product must have some measure of “functional superiority.” n Price must also contain margin l For funding of necessary activities... l and profit n Price can send additional signals n Can be a strategy in itself, or, more likely, part of a strategy

13. 2. Price n Here is an example of advertising that supports a price strategy

14. 3. Place n Similar products can make different “place” decisions n Example: Coffee l Folgers (retail) n Similar products can make different “place” decisions n Example: Coffee l Folgers (retail)

15. n Similar products can make different “place” decisions n Example: Coffee l Folgers l Gevalia n Similar products can make different “place” decisions n Example: Coffee l Folgers l Gevalia 3. Place

16. n Similar products can make different “place” decisions n Example: Coffee l Folgers l Gevalia l Starbucks n Similar products can make different “place” decisions n Example: Coffee l Folgers l Gevalia l Starbucks n A Critical Decision

17. 4. Promotion n A range of marketing communications (MarCom) techniques can be used: l Advertising l Sales Promotion l Public Relations l Publicity l Internet/New Media n A range of marketing communications (MarCom) techniques can be used: l Advertising l Sales Promotion l Public Relations l Publicity l Internet/New Media l Direct Sales l Direct Marketing l Event Marketing l Trade Shows l Promotional Products l Direct Sales l Direct Marketing l Event Marketing l Trade Shows l Promotional Products

18. 5. People n Some controversy over the “Fifth P” l Once, some said “packaging” l One consultant says “personalization” l We say it’s “People.” n Your customers n Your own people l Work force & Sales force n Other “stakeholders” l Trade, Suppliers, Stockholders n Some controversy over the “Fifth P” l Once, some said “packaging” l One consultant says “personalization” l We say it’s “People.” n Your customers n Your own people l Work force & Sales force n Other “stakeholders” l Trade, Suppliers, Stockholders

19. The Marketing Mix n The right combinations of... n Demand l Example: Price/Supply n Marketing Variables l Five P Variables l Promotional Variables n Marketing Strategy... n The right combinations of... n Demand l Example: Price/Supply n Marketing Variables l Five P Variables l Promotional Variables n Marketing Strategy...

20. Unique Combinations Unique Marketing Strategies n Example: Early auto industry l Ford - Product/Price n Example: Early auto industry l Ford - Product/Price l GM - Multiple Brands l Chrysler - Competitive Position l GM - Multiple Brands l Chrysler - Competitive Position l GM - Product/Value

21. Unique Combinations Unique Marketing Strategies n Example: Early auto industry l Ford - Product/Price n Example: Early auto industry l Ford - Product/Price l GM - Multiple Brands l GM - Product/Value n Example: Bose l Promotion + Place Direct instead of stores

22. Marketing Departments n Vertical Organization l Traditional military “command” structure l Clear lines of responsibility l Seems to work best when there are numerous similar products n Horizontal Organization l More fluid “ad hoc” structure l Organize around needs and functions n Vertical Organization l Traditional military “command” structure l Clear lines of responsibility l Seems to work best when there are numerous similar products n Horizontal Organization l More fluid “ad hoc” structure l Organize around needs and functions 2 Types of Organization

23. Top Job Functions: n For both types of organizations n CEO, COO, CMO l Chief Executive Officer l Chief Operating Officer l Chief Marketing Officer s Top Marketing person s “Heavy hitter” usually 35+ l CFO, CIO s Chief Financial Officer s Chief Information Officer n For both types of organizations n CEO, COO, CMO l Chief Executive Officer l Chief Operating Officer l Chief Marketing Officer s Top Marketing person s “Heavy hitter” usually 35+ l CFO, CIO s Chief Financial Officer s Chief Information Officer

24. Vertical Organization n Example: Oscar Mayer (KGF) Consumer Products

25. Jobs in Vertical Organization n Category Manager l Veteran (in 30s) l Major overall responsibility l Nurture/grow brands and brand managers n Brand Manager l Up from Assistant (mid-20s) l Responsible for one brand only l “It’s your baby” l Succeed or die n Category Manager l Veteran (in 30s) l Major overall responsibility l Nurture/grow brands and brand managers n Brand Manager l Up from Assistant (mid-20s) l Responsible for one brand only l “It’s your baby” l Succeed or die

26. Horizontal Organization n Example: McDonnell-Douglas (2 groups)

27. Jobs in Horizontal Organization n VP of Program l Must know the business l Maturity/power/clout - 35+ nMarketing Manager l Marketing experience, not necessarily advertising l Responsible for all advertising, PR, sales promotion, trade shows, etc. n Advertising Manager l May be “thrown into” role l May have little ad experience l Competition from other programs n VP of Program l Must know the business l Maturity/power/clout - 35+ nMarketing Manager l Marketing experience, not necessarily advertising l Responsible for all advertising, PR, sales promotion, trade shows, etc. n Advertising Manager l May be “thrown into” role l May have little ad experience l Competition from other programs

28. Marketing Job Functions n Director of Marketing l Often, trained w. “feeder system” s P&G, KGF, etc. s Has become COO career path l Must manage increasing variety of MarCom programs and suppliers n Advertising Director l Importance depends on size of budget l May also have significant responsibilities monitoring media spending n Director of Marketing l Often, trained w. “feeder system” s P&G, KGF, etc. s Has become COO career path l Must manage increasing variety of MarCom programs and suppliers n Advertising Director l Importance depends on size of budget l May also have significant responsibilities monitoring media spending

29. Marketing Job Functions n Category Manager l Group Product Manager n Category Manager l Group Product Manager Bridgette Hellerfrom Brand Manager Gevalia to Category Manager for Coffee at KGF Bridgette Heller - from Brand Manager Gevalia to Category Manager for Coffee at KGF n Brand Manager n Brand Assistant n Other Staff Functions: l Sales Promotion l Media l Market Research n Field Marketing… n Brand Manager n Brand Assistant n Other Staff Functions: l Sales Promotion l Media l Market Research n Field Marketing…

30. Field Marketing n Excellent entry level job opportunity n There are many marketers that operate Field Marketing Organizations l Beverage Industry (Beer, Soft Drink) l Fast Food Industry l Franchise Organizations l In many cases, ad agencies that service these marketers also provide Field Marketing n “Think Global. Act Local.” n Excellent entry level job opportunity n There are many marketers that operate Field Marketing Organizations l Beverage Industry (Beer, Soft Drink) l Fast Food Industry l Franchise Organizations l In many cases, ad agencies that service these marketers also provide Field Marketing n “Think Global. Act Local.”

31. The Marketing Process n Simply put, it’s... l Planning l Implementation l Evaluation n Simply put, it’s... l Planning l Implementation l Evaluation

32. PlanningPlanning 1. Setting overall marketing strategy 2. Developing annual marketing plan 3. Calculating annual marketing budget 4. Assigning marketing tasks (planning) 1. Setting overall marketing strategy 2. Developing annual marketing plan 3. Calculating annual marketing budget 4. Assigning marketing tasks (planning) NOTE: All of this is covered in more detail in Chapter 8 - Marketing & Planning

33. ImplementationImplementation 4. Assigning marketing tasks (continued) l After budgets approved, operations move from the theoretical to the practical l NOTE: Actual costs may vary from budget - plans may need to be changed “on the fly” 5. Supervising internal functions l NOTE: PR may be internal, external or both 6. Overseeing external services l Advertising, sales promotion, etc. l NOTE: Variety of MarCom program options is growing 4. Assigning marketing tasks (continued) l After budgets approved, operations move from the theoretical to the practical l NOTE: Actual costs may vary from budget - plans may need to be changed “on the fly” 5. Supervising internal functions l NOTE: PR may be internal, external or both 6. Overseeing external services l Advertising, sales promotion, etc. l NOTE: Variety of MarCom program options is growing

34. Evaluation:Evaluation: 7. Measuring and tracking efforts l Sales Results l Media Expenditures l Awareness and Usage l Ongoing Market Research programs (tracking) 8. Reporting performance to management l NOTE: May be daily, weekly, or quarterly. Trend is for more frequent reporting 9. Integrating results into planning l The cycle continues - working for improvement 7. Measuring and tracking efforts l Sales Results l Media Expenditures l Awareness and Usage l Ongoing Market Research programs (tracking) 8. Reporting performance to management l NOTE: May be daily, weekly, or quarterly. Trend is for more frequent reporting 9. Integrating results into planning l The cycle continues - working for improvement NOTE: Some of this is covered in more detail in Chapter 11 Evaluation & Integration

35. Marketing Challenges: n Increasing importance of marketing l As mentioned, “Marketing is Everything” the function is more important for everyone n Hyper-Competition l Too much capacity for size of market l Happening on a global scale l Examples: Automobiles, computers n Fragmentation l Consumers, Media, etc. l Harder to do “mass” marketing n And of course… n Increasing importance of marketing l As mentioned, “Marketing is Everything” the function is more important for everyone n Hyper-Competition l Too much capacity for size of market l Happening on a global scale l Examples: Automobiles, computers n Fragmentation l Consumers, Media, etc. l Harder to do “mass” marketing n And of course…

36. Marketing Challenges: n The Media Revolution l Changing Business Models s Example: Newspapers/Network TV l Chan ging Consumer Habits s Example: Response to Economy l Shift in Control of Media Channels s Example: Social Media n The Media Revolution l Changing Business Models s Example: Newspapers/Network TV l Chan ging Consumer Habits s Example: Response to Economy l Shift in Control of Media Channels s Example: Social Media

37. Marketing Challenges: n The Media Revolution l Changing Business Models s Example: Newspapers/Network TV l Changing Consumer Habits s Example: Response to Economy l Shift in Control of Media Channels s Example: Social Media l New Communication Channels s Example: “The Third Screen” n The Media Revolution l Changing Business Models s Example: Newspapers/Network TV l Changing Consumer Habits s Example: Response to Economy l Shift in Control of Media Channels s Example: Social Media l New Communication Channels s Example: “The Third Screen”

38. Marketing Challenges: The future is sure to be challenging. But those challenges will be met with Marketing! Because today and tomorrow Marketing is Everything! The future is sure to be challenging. But those challenges will be met with Marketing! Because today and tomorrow Marketing is Everything!

39. Questions & Discussion