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PART Ⅰ UNDERSTANDING MARKETING AND THE MARKETING PROCESS2

1 Marketing in a Changing World: Creating Customer Value and Satisfaction2

What Is Marketing?6

Needs, Wants, and Demands7

Products9

Value, Satisfaction, and Quality10

Exchange, Transactions, and Relationships11

Markets12

Marketing13

Marketing Management14

Demand Management14

Building Profitable Customer Relationships14

Marketing Management Philosophies15

The Production Concept15

The Product Concept17

The Selling Concept17

The Marketing Concept19

The Societal Marketing Concept20

Marketing Challenges into the Next Century22

Growth of Non-Profit Marketing22

Rapid Globalization23

The Changing World Economy25

The Call for More Ethics and Social Responsibility26

The New Marketing Landscape26

Summary27

Key Terms28

Discussing the Issues28

Applying the Concepts29

References29

COMPANY CASE 1: DOORGUARD: TRYING TO MAKE A DENT IN THE MARKET30

VIDEO CASE 1: ZELLERS STRIKES BACK33

2 Strategic Planning and the Marketing Process34

Strategic Planning37

Defining the Company Mission38

Setting Company Objectives and Goals40

Designing the Business Portfolio41

Analysing the Current Business Portfolio41

Developing Growth Strategies44

Planning Functional Strategies45

The Marketing Process47

Target Consumers47

Marketing Strategies for Competitive Advantage50

Developing the Marketing Mix51

Managing the Marketing Effort53

Marketing Analysis54

Marketing Planning54

Marketing Implementation57

Marketing Department Organization60

Marketing Control62

The Marketing Environment64

Summary65

Key Terms66

Discussing the Issues66

Applying the Concepts66

References67

COMPANY CASE 2: TRAP-EASE: THE BIG CHEESE OF MOUSETRAPS68

VIDEO CASE 2: TAKING A RISK OR PLAYING IT SAFE70

3 The Marketing Environment72

The Company's Microenvironment76

The Company76

Suppliers76

Marketing Intermediaries76

Customers77

Competitors77

Publics77

The Company's Macroenvironment78

Demographic Environment78

Economic Environment86

Natural Environment88

Technological Environment90

Political Environment92

Cultural Environment94

Responding to the Marketing Environment98

Summary100

Key Terms100

Discussing the Issues101

Applying the Concepts101

References102

Demographic Study: Fifty something: Don't Call Me Old103

VIDEO CASE 3: MAIL-ORDER PHARMACY105

COMPREHENSIVE CASE I: MASTERCARD: CHARGING THE COMPETITION106

PART Ⅱ ANALYSING MARKET OPPORTUNITIES110

4 Marketing Research and Information Systems110

The Marketing Information System114

Assessing Information Needs114

Developing Information115

Distributing Information120

The Marketing Research Process121

Defining the Problem and Research Objectives121

Developing the Research Plan123

Implementing the Research Plan134

Interpreting and Reporting the Findings135

Other Marketing Research Considerations135

Summary140

Key Terms140

Discussing the Issues140

Applying the Concepts141

References141

COMPANY CASE 4: ACT Ⅰ:FEELING OUT THE APPLIANCE CONTROLS MARKET143

VIDEO CASE 4: TOUGH TO REACH147

5 Consumer Markets and Consumer Buyer Behaviour148

Model of Consumer Behaviour151

Characteristics Affecting Consumer Behaviour152

Cultural Factors152

Social Factors158

Personal Factors159

Psychological Factors163

Consumer Buying Roles169

Types of Buying Decision Behaviour169

Complex Buying Behaviour169

Dissonance-Reducing Buying Behaviour170

Habitual Buying Behaviour170

Variety-Seeking Buying Behaviour171

The Buyer Decision Process171

Need Recognition172

Information Search172

Evaluation of Alternatives173

Purchase Decision174

Postpurchase Behaviour174

The Buyer Decision Process for New Products175

Stages in the Adoption Process176

Individual Differences in Innovativeness177

Influence of Product Characteristics on Rate of Adoption178

Consumer Behaviour Across International Borders179

Summary181

Key Terms182

Discussing the Issues182

Applying the Concepts182

References183

COMPANY CASE 5: SHISEIDO: RETHINKING THE FUTURE184

VIDEO CASE 5: RETURN OF A STATUS SYMBOL186

COMPREHENSIVE CASE Ⅱ: PLEDGE: ASSESSING MARKETING STRATEGIES187

6 Business Markets and Business Buyer Behaviour198

Business Markets201

Characteristics of Business Markets201

A Model of Business Buyer Behaviour206

Business Buyer Behaviour206

Major Types of Buying Situations206

Participants in the Business Buying Process208

Major Influences on Business Buyers208

The Business Buying Process214

Institutional and Government Markets217

Institutional Markets217

Government Markets217

Summary220

Key Terms220

Discussing the Issues220

Applying the Concepts221

References221

COMPANY CASE 6: ACT Ⅱ CONTROLLING AN INDUSTRIAL MARKET222

PART Ⅲ SELECTING TARGET MARKETS228

7 Measuring and Forecasting Demand228

Defining the Market231

Measuring Current Market Demand231

Estimating Total Market Demand232

Estimating Area Market Demand234

Estimating Actual Sales and Market Shares236

Forecasting Future Demand236

Survey of Buyers' Intentions237

Composite of Sales Force Opinions239

Expert Opinion240

Test Marketing241

Time-Series Analysis241

Leading Indicators241

Statistical Demand Analysis242

Summary242

Key Terms243

Discussing the Issues243

Applying the Concepts244

References244

COMPANY CASE 7: FORECASTING CHILD'S PLAY245

VIDEO CASE 7: WHAT'S OUR MARKET SHARE?247

8 Market Segmentation, Targeting, and Positioning for Competitive Advantage248

Markets250

Market Segmentation252

Bases for Segmenting Consumer Markets253

Segmenting Business Markets261

Segmenting International Markets263

Requirements for Effective Segmentation264

Market Targeting265

Evaluating Market Segments265

Selecting Market Segments266

Positioning for Competitive Advantage271

What Is Market Positioning?271

Positioning Strategies271

Choosing and Implementing a Positioning Strategy272

Summary279

Key Terms280

Discussing the Issues280

Applying the Concepts280

References281

COMPANY CASE 8A: QUAKER OATS: DOUSING ON THE COMPETITION281

COMPANY CASE 8B: RYKA: BE STRONG284

VIDEO CASE 8: PASTA: CONDITIONING FOR THE U.S. MARKET286

PART Ⅳ DEVELOPING THE MARKETING MIX288

9 Designing Products: Products, Brands, Packaging, and Services288

What Is a Product?290

Product Classifications292

Consumer Products292

Industrial Products293

Individual Product Decisions294

Product Attributes294

Branding298

Marketers Speak Out305

Packaging311

Labelling314

Product-Support Services315

Product Line Decisions316

Product Line Length316

Product Line Modernization318

Product Line Featuring318

Product Mix Decisions319

International Product Decisions320

Summary322

Key Terms323

Discussing the Issues323

Applying the Concepts324

References324

COMPANY CASE 9: COLGATE: SQUEEZING MORE FROM A BRAND NAME326

VIDEO CASE 9: CREATING BREAD: THE STAPLE OF LIFE328

10 Designing Products: New-Product Development and Product Life-Cycle Strategies330

New-Product Development Strategy333

New-Product Success and Failure333

The New-Product Dilemma334

The New-Product Development Process336

Idea Generation336

Idea Screening337

Concept Development and Testing338

Marketing Strategy Development340

Business Analysis341

Product Development341

Test Marketing342

Commercialization344

Marketers Speak Out345

Speeding Up New-Product Development346

Product Life-Cycle Strategies347

Introduction Stage349

Growth Stage350

Maturity Stage350

Decline Stage353

Summary354

Key Terms355

Discussing the Issues355

Applying the Concepts356

References356

COMPANY CASE 10: INTRODUCING SPLENDA BRAND SWEETENER357

VIDEO CASE 10: THE FRIDGE359

11 Pricing Products: Pricing Considerations and Approaches360

Factors to Consider When Setting Prices363

Internal Factors Affecting Pricing Decisions364

External Factors Affecting Pricing Decisions369

General Pricing Approaches374

Cost-Based Pricing376

Value-Based Pricing377

Competition-Based Pricing379

Summary380

Key Terms381

Discussing the Issues381

Applying the Concepts381

References382

COMPANY CASE 11: CANADIAN VS. AIR CANADA: SURVIVING THE FARE WARS382

VIDEO CASE 11: UNITEL385

12 Pricing Products: Pricing Strategies386

New-Product Pricing Strategies389

Market-Skimming Pricing389

Market-Penetration Pricing390

Product-Mix Pricing Strategies391

Product Line Pricing391

Optional-Product Pricing392

Captive-Product Pricing392

By-Product Pricing392

Product-Bundle Pricing393

Price-Adjustment Strategies393

Discount and Allowance Pricing393

Segmented Pricing394

Psychological Pricing395

Promotional Pricing396

Value Pricing397

Geographical Pricing397

International Pricing400

Price Changes401

Initiating Price Changes401

Responding to Price Changes403

Summary406

Key Terms406

Discussing the Issues407

Applying the Concepts407

References407

COMPANY CASE 12: CIRCUITCITY: SELLING USED CARS LIKE STEREOS408

VIDEO CASE 12: WEDDING BELLS410

13 Placing Products: Distribution Channels and Logistics Management412

The Nature of Distribution Channels416

Why Are Marketing Intermediaries Used?416

Distribution Channel Functions416

Number of Channel Levels417

Channels in the Service Sector419

Channel Behaviour and Organization419

Channel Behaviour420

Vertical Marketing Systems422

Horizontal Marketing Systems425

Hybrid Marketing Systems426

Channel Design Decisions427

Analysing Consumer Service Needs428

Setting the Channel Objectives and Constraints429

Identifying Major Alternatives430

Evaluating the Major Alternatives432

Designing International Distribution Channels433

Channel Management Decisions434

Selecting Channel Members434

Motivating Channel Members434

Evaluating Channel Members435

Physical Distribution and Logistics Management437

Nature and Importance of Physical Distribution and Marketing Logistics437

Goals of the Logistics System438

Major Logistics Functions439

Integrated Logistics Management443

Summary445

Key Terms446

Discussing the Issues446

Applying the Concepts447

References447

COMPANY CASE 13: ICON ACOUSTICS: BYPASSING TRADITION448

VIDEO CASE 13: THE CHANNEL NOT TAKEN451

14 Placing Products: Retailing and Wholesaling452

Retailing454

Store Retailing455

Amount of Service455

Product Line455

Relative Prices460

Control of Outlets462

Type of Store Cluster463

Non-Store Retailing464

Direct Marketing464

Direct Selling465

Automatic Vending467

Retailer Marketing Decisions468

Target Market and Positioning Decision468

Product Assortment and Services Decision468

Price Decision472

Promotion Decision472

Place Decision472

The Future of Retailing472

Wholesaling473

Types of Wholesalers474

Merchant Wholesalers474

Brokers and Agents476

Manufacturers' Sales Branches and Offices477

Wholesaler Marketing Decisions477

Target Market and Positioning Decision477

Marketing Mix Decisions477

Trends in Wholesaling478

Summary479

Key Terms480

Discussing the Issues480

Applying the Concepts481

References481

COMPANY CASE 14: CANADIAN RETAILING; AN INDUSTRY IN CHAOS482

VIDEO CASE 14: BACK TO SQUARE ONE486

15 Promoting Products: Marketing Communication Strategy488

Steps in Developing Effective Communication492

Identifying the Target Audience493

Determining the Response Sought493

Marketers Speak Out494

Choosing a Message495

Choosing Media497

Selecting the Message Source498

Collecting Feedback499

Setting the Total Promotion Budget and Mix500

Setting the Total Promotion Budget500

Setting the Promotion Mix501

The Changing Face of Marketing Communications505

The Changing Communication Environment506

Growth of Direct Marketing507

Integrated Marketing Communications511

Socially Responsible Marketing Communication512

Advertising512

Personal Selling514

Direct Marketing515

Summary516

Key Terms517

Discussing the Issues518

Applying the Concepts518

References519

COMPANY CASE 15: AVON: A PROMOTIONAL STRATEGY MAKEOVER520

VIDEO CASE 15: DIRECT RESPONSE-IMMEDIATE RESULTS523

Window on the Future: Internet Marketing524

The Explosive Growth of "The Web"525

A Brief History of the Internet525

The World Wide Web: An Evolving Marketing Tool525

Understanding Empowered Consumers526

Who Uses the Net527

Using the Internet for Competitive Advantage527

Enhancing Strategic Positioning527

Creation of First-Mover Advantages529

A New Focus for Marketing Strategy529

The Need for Careful Segmentation530

The Internet and Marketing Mix Decisions531

Improved Product Decisions531

Revised Channels of Distribution532

Pricing and Payment532

Communication Vehicle533

Promotion Vehicle533

Monitoring Effectiveness534

The Future of Internet Marketing535

Facilitators Who Support Internet Marketing535

Interesting and Effective Web Sites536

References538

CASE STUDY—INTERNET MARKETING AT LABATT540

16 Promoting Products: Advertising, Sales Promotion, and Public Relations542

Advertising545

Major Decisions in Advertising547

Setting Objectives547

Setting the Advertising Budget549

Advertising Strategy550

Advertising Evaluation558

International Advertising Decisions559

Sales Promotion561

Rapid Growth of Sales Promotion561

Purpose of Sales Promotion562

Setting Sales-Promotion Objectives563

Selecting Sales-Promotion Tools563

Developing the Sales-Promotion Program568

Public Relations569

Major Public Relations Tools571

Major Public Relations Decisions572

Summary574

Key Terms574

Discussing the Issues574

Applying the Concepts575

References575

COMPANY CASE 16: BURGER KING: SEARCHING FOR THE RIGHT MESSAGE576

VIDEO CASE 16: EXPOSING ADVERTISING'S DARK SIDE579

17 Promoting Products: Personal Selling and Sales Management580

The Role of Personal Selling582

The Nature of Personal Selling582

The Role of the Sales Force584

Managing the Sales Force585

Designing Sales-Force Strategy and Structure585

Recruiting and Selecting Salespeople588

Training Salespeople591

Compensating Salespeople592

Supervising Salespeople593

Evaluating Salespeople596

Principles of Personal Selling598

The Personal Selling Process599

Steps in the Selling Process599

Relationship Marketing601

Summary603

Key Terms604

Discussing the Issues604

Applying the Concepts604

References605

COMPANY CASE 17: IBM: RESTRUCTURING THE SALES FORCE606

VIDEO CASE 17: CANADA'S HOTTEST HOME SELLER608

PART Ⅴ MANAGING THE MARKETING EFFORT610

18 Building Customer Relationships Through Satisfaction, Value, and Quality610

Defining Customer Value and Satisfaction614

Customer Value615

Customer Satisfaction617

Delivering Customer Value and Satisfaction619

Value Chain619

Value Delivery System621

Retaining Customers622

The Cost of Lost Customers622

The Need for Customer Retention623

The Key: Customer Relationship Marketing623

The Marketers Speak Out627

Ultimate Test: Customer Profitability628

Implementing Total Quality Marketing629

Total Quality Management629

Marketing's Role in Total Quality630

Summary632

Key Terms632

Discussing the Issues632

Applying the Concepts633

References633

COMPANY CASE 18: OUTBACK STEAKHOUSE:BREAKING THE RULES634

VIDEO CASE 18: BOOTS: COMPETITIVE ADVANTAGE637

19 Creating Competitive Advantage: Competitor Analysis and Competitive Marketing Strategies638

Competitor Analysis641

Identifying the Company's Competitors642

Determining Competitors' Objectives643

Identifying Competitors' Strategies644

Assessing Competitors' Strengths and Weaknesses644

Estimating Competitors' Reactions645

Selecting Competitors to Attack and Avoid647

Designing a Competitive Intelligence System648

Competitive Strategies649

Basic Competitive Strategies650

Competitive Positions652

Market-Leader Strategies653

Market-Challenger Strategies657

Market-Follower Strategies659

Market-Nicher Strategies660

Balancing Customer and Competitor Orientations662

Summary663

Key Terms664

Discussing the Issues664

Applying the Concepts664

References664

COMPANY CASE 19: COMPETITION NIPS AT AIR CANADA665

VIDEO CASE 19: SHREDDING THEIR WAY TO THE TOP668

PART Ⅵ EXTENDING MARKETING670

20 The Global Marketplace670

Global Marketing into the Twenty-First Century673

Looking at the Global Marketing Environment675

The International Trade System675

Marketers Speak Out680

Economic Environment681

Political-Legal and Ethical Environment683

Cultural Environment684

Deciding Whether To Go International685

Deciding Which Market to Enter687

Deciding How to Enter the Market689

Exporting689

Joint Venturing690

Direct Investment691

Deciding on the Global Marketing Program693

Product693

Promotion694

Price695

Distribution Channels697

Deciding on the Global Marketing Organization697

Summary698

Key Terms699

Discussing the Issues699

Applying the Concepts700

References700

COMPANY CASE 20: NORPAK CORPORATION701

VIDEO CASE 20: MISSION IMPOSSIBLE: VISITING POTENTIAL MARKETS709

21 Marketing Services, Organizations, Persons, Places, and Ideas710

Services Marketing713

Nature and Characteristics of a Service715

Marketing Strategies for Service Firms718

International Services Marketing723

Marketers Speak Out724

Organization Marketing726

Image Assessment726

Image Planning and Control726

Person Marketing727

Place Marketing729

Idea Marketing730

Summary732

Key Terms732

Discussing the Issues732

Applying the Concepts733

References733