1. MARKETING FUNDAMENTALS COMPETITION

2. LEARNING GOALS I will be able to explain how marketing (e.g., branding, promotion, packaging, online sales) affects competition among products; I will be able to describe how evolving information technologies are used to influence, inform, and motivate consumers (e.g., corporate websites, e-commerce, Internet pop-up ads).

3. WHAT IS COMPETITION? What companies/businesses compete for your dollar: in fast food? in music? in clothing? How does marketing affect competition among products? Why is there competition?

4. WHAT IS COMPETITION? We live in a free-market society. businesses can make a profit, keep some of the money they make Profit drives business; the more successful a business is, the more profit the owner keeps. Profits can be reinvested, used to grow business, pay off debt. A free-market society allows individuals to hold private property--you may purchase things, keep them, sell them… you can use your property to create personal profit.

5. WHAT IS COMPETITION? Two or more businesses trying to sell the same type of product or service to the same customer Market share The percentage of the sales volume of a total market held by a specific company E.g. If the cereal market is valued at $10 billion and General Mills is worth $2.5 billion, what is its market share?

6. COMPETITION: GOOD OR BAD???? Businesses – good or bad? Why? Customers – good or bad? Why?

7. THE BENEFITS OF COMPETITION Why do consumers want competition? Encourages new business creation More jobs and therefore salaries for people Wide selection of goods and services for consumers (choices) Product type, style, price and quality Forces businesses to produce better quality products and offer reasonable prices

8. DIRECT VS. INDIRECT COMPETITION Direct When companies with products that are very similar are competing for the same market E.g. Coke and Pepsi, Nike and Adidas Indirect When companies with products that are NOT similar are in competition for consumer’s income E.g. What can you buy for $20.00?

9. INDIRECT COMPETITIONDIRECT COMPETITION EXAMPLE:

10. COMPETITIVE STRATEGIES Allows the company to hold onto or increase its market share Achieved by gaining a ‘competitive advantage’ An advantage over competitors by offering consumers greater value How can they do this? ~BRAINSTORMING SESSION~ Groups of 3 or 4

12. COMPETITIVE ADVANTAGES 1. Promotion To create top-of-mind awareness Increase sales Gain consumer loyalty E.g. Tim Hortons Roll Up the Rim to Win 2. Placement It must be where consumers want it, when consumers want it E.g. Tim Hortons location…

14. COMPETITIVE ADVANTAGES 3. Branding Creating a name, symbol or design that identifies and differentiates a product from other products 4. Quality Being the best of its type Stronger, faster, easier, lighter, etc. Adding features to improve a product

15. 5. Price All features equal, price must be lower than competitors to be a competitive advantage Hard to sustain because prices change all the time E.g. Ikea Winter Sale Promotion 6. Technology Using a better technology or offering a more innovative product E.g. Online Coupons COMPETITIVE ADVANTAGES E.g

17. 7. Design Features The function and form of the product E.g. A car’s design makes it move from one place to another (function) and defines its color and shape (form) We often buy for the ‘look’ of the product when the functions are similar or the same Packaging becomes important too COMPETITIVE ADVANTAGES

19. CONCLUSION Marketing does create a BIG IMPACT on Competition among Products …through branding, promotion, pricing, packaging, information technology, etc.

20. IN-CLASS Choose a company and research how they increase their competitive advantage(s) by marketing its product(s) differently …through branding, promotion, pricing, packaging, information technology, etc.

21. EVOLVING INFORMATION TECHNOLOGIES AND THEIR INFLUENCE ON CONSUMERS

22. THE INTERNET 3 Major Types of Internet Marketing Company Websites Banner Advertisements Emails Each has its own characteristics:  Most visitors to a Website are interested in the site in the first place  A company Website is like a retail outlet for customers to visit  Email marketing usually targets consumers who have already given out their email addresses to the business ( permission-based email).

23. ONLINE MARKETING – GOOD OR BAD? Benefits? Disadvantages?

24. THE INTERNET Can be inexpensive, convenient and time-saving A well designed site is significantly more effective (e.g. by adding Flash, rich text, streaming media, or HTML)  Adding these audio-video components can make these types of marketing more expensive, yet making it about 50% more effective! Problems :  Spam and pop-ups make consumers angry!  Despite its convenience, it has not fully replaced retail stores: 1. Security concern for giving out credit card numbers at purchase. 2. Product arrival wait-time: At Minimum 24 Hours! 3. Cannot feel, touch, and smell products before purchase. 4. The companionship of shopping is missing!

25. SO, HOW DO YOU THINK EVOLVING INFORMATION TECHNOLOGIES ARE USED TO: INFLUENCE CONSUMERS? INFORM CONSUMERS? MOTIVATE CONSUMERS?