COMM 420 Midterm Exam

what is business

an exchange

• a relationship (giver and taker)

• positive long term relationships

what you have and what you want and then the process of getting it through relationships

explain an exchange (under what is marketing)

two or more parties with unsatisfied needs

desire and ability to satisfy these needs

• need to see value in the exchange

a way for the parties to communicate

what is marketing definition

managing profitable customer relationships

• need marketing for everything to function

• building, enriching, stabilizing relationship

the tool you are using to make all relationships

process of developing the relationships

what is marketing goals

attract new customers by promising superior value

keep and grow current customer base by delivering satisfaction

B2B Relationship

a commercial connection where one company sells products, raw materials, software, or services to another company rather than to an individual consumer

• alibaba

• nivida

B2C Relationship

A B2C relationship is “business-to-consumer”: a company sells its products or services directly to individual people who will use them personally, rather than to other businesses.

• nike

• amazon,

• netflix

C2C Relationship

C2C stands for “consumer-to-consumer,” meaning transactions or interactions between individuals rather than involving a business. The most common form is people selling used or secondhand items to each other, through platforms like eBay, Facebook Marketplace, Craigslist, Poshmark, or Depop.

4Ps (list them)

1. Product

2. Price

3. Place

4. Promotion

relationship between B2b, B2C, C2C

they all interact

companies can have components of all these things

Marketing Mix

• marketing has 4 main pillars that holds the entire thing together

• all marketing activities fall into one of these 4p’s

• all 4 pillars are equally as important

P1 - Product (creating value)

what the company has to give

what value the company has to give to its consumers

Example: P1 of Apple

• ipads

• laptops

• icloud

• software

• store location

• store experience

• warrently system

• confidence in the brand

• creating social status

• brand of the company

P2 Price (capturing value)

what the company gets from the consumer

structure it in a way that you get what you want from the consumer

what you think you are worth/what you want

how you are capturing what you want from the consumer

revenue

Example: Apple’s P2

• changing charger to make you buy more

• warranty system (apple care)

• uses IOS

• charges a premium on the phone

  • makes money on the phone

• accessories

Example: P2 Toyota

• dont make money from the car

• make from from leasing or financing

• the company that helps you do this is Toyota Bank

• helping you finance the product they are selling you

• which is more money than marking up the car price

Premium Pricing Strategy

• ex: apple

• everything is priced up/high

• if you dont like it buy something else

• no discount

• structure is always high

P3 Place (delivering the value proposition)

platform of distribution

Example: P3 Apple

• apple store → create an experince

• exclusive space just for them in other retailers

• direct sales online

• amazon, booths in best buy

  • all treat amazon exclusively

Pricing Decoy

draw you in with someone then you end up spedning lots of money

ex: buy an ipad and then pay more for storage then if youre already spending that much why not buy more storage or more other features

cost is all the same for anything

P4 Promotion (communicate value)

how the company communicates who they are to others

Example: P4 Apple

they are communicating the brand

they develop feelings etc

whenever you buy a product you are buying into the ecosystem through the brand

• visible stores

• everyone has an apple

• design and color stands out so much

• online exposure

• visible of the ppl who work there → shirt they wear

• presence is very difficult to deny

can you control the 4 P’s

Yes

4Cs (list them)

Consumer Value

Cost

Convenience

Communication

Consumer value

what are they looking for

ex: resale value, milage etc

Cost

how much am I willing to pay

convience

where is it placed

ex: the automall

communication

why should I buy

ex: cost features

relationships between 4P’s and 4C’s

Scarcity Principle

the most you feel like you don’t belong there the most you want to prove it

purposely make you feel like you dont belong so that you buy more and prove them wrong

ex: BMW

• waitlist, need a trade in etc

• never enough supply so you feel like you need it

• only a certain type of engineer

• make sure its limited

Marketing Prior to 1920’s

Before: Marketing is just Manufacturing

• if you can make it you can sell it

• bc consumers have very little options

• before WW1 basically just manufactoring if you could make it you can sell it bc there are SO little options

Marketing Prior to 1950’s

spending a lot of money bc you were making a lot of money

Marketing = Sales

who is my customer

Maketing Since 1950’s

position you company in the place that you want it to be

Early Marketing

how can i manufacture more, how can I drive effiencies how can I push

Contemparary Marketing

who is my customer, what do they need, how do they feel

• consumer approach

Marketing today

just by selling product just bc you need it is not enough

need to create experiences meaning etc

the brand understands you

Main concept of the evolution of marketing

marketing has changed into more experiences based

no one is everywhere but its mostly about creating experiences and exposure, background, everything has an impact

what do companies do in new enviroments

adapt, alter their marketing strategies based on culture, traditions etc

companies taylor their approch based on their audience

IKEA USA - appeal

appealed to families

focused on the product itself

IKEA USA - Emphasis

emphasis on DIY and affordability

talked mostly about the product in the ads

Why did IKEA use this specific approch in USA

USA homes bigger, more time on hand, and nescesities to build something

there was a big DIY movement in the USA

sellable proposition

• sells a lot more bc of the trends

How is this model good for IKEA USA

lowers their labor costs

labor in north america is expensive

• bc of lower population there is lots of regulations and more expensive

in america ppl dont really see their time as money they see cheap and dont think about how much time that will take them

easier to transport items

Why does IKEA’s USA model work so well?

bc cities in USA are designed for cars and vehicles

What does IKEA Japan focus on selling?

sells more of a feeling rather than a product,

message is the lifestyle

offer something that is different

does focus on efficiency

Why don’t they focus on DIY in Japan IKEA

bc the DIY movement failed bc of rigid housing cultural empahsis on professional craftmenship

more empahsis on gender rolls therefore someone is always working not a big family activity like is USA and also less time

induvidualistic mindset

• only focus on work work work therefore time for yourself is sparce

Why is this model good for Japan?

public transportation is the main mode

asian cities are built for ppl not cars and public transport is less feasible

cars are more a status symbol

cost of labour is cheaper and more accessable

Why does IKEA market their products like this

bc western products are positioned high therefore something foreign should be protigious and self assemly is not prostigious

pushing the “relaxed” western lifestyle laid back about the experience etc

japan is more minimalist

• reglion is embeded into culture

KFC in China

lifestyle based

use celebrities bc they signify a status symbol and have lots of influence

emphasis on a GOOD/BETTER burger

KFC in North America

cheaper, bigger, emphasis on good value, size & product itself

don’t use celebirties bc they are polarizing

A Marketing Environment Analysis Framework

9 factors that are crucial to the enviroment that shapes marketing

The Immediate Enviroment

Company

Compeition

Coporate Partners

Consumers

• 4 main factors that shapes the DNA of the Firm

• 4C”s but for the company

who you are shapes your identity

whatever the companies main audience is shapes the company

Company

you

what is the goal @hand

Corporate Partners

friends

you are what you work with

most organizations are working in partnerships with other companies and its ability to “win” greatly depends on the quality and availability of good partners. you cannot do busniess alone

Competition

enemies

who you choose to see as your biggest rival says a lot about who you are and what you’re obessed with

Honda Engines Analysis

good at making proformance engines

honda is an engine supplier

which segregates them from their competition

Toyota Analysis

focus: production system and best manufactoring

highest efficiency of assembling to selling the car

Direct Competitors

same target segment

same need

same product

indirect competitors

same target segment

same need

different product

marketplace competitors

same target segment

different need

different product

Marcoenviroment Factors CD STEP

Culture

Demographics

Political/Legal

Economic

Social

Technology

• more zoomed out that still shape the company

*keep this in mind for all cases

Culture

location

ex: work oriented or family oriented

Demographics

younger vs older age

Social

multicultrilsim vs monocultralism

presitige

technology

online allows you to be who you want not you are are

social medial influence is very high and impactful

economic

economic booms conditions make a large impact

political/legal

regulations that shape what the company can & cannot do

some companies are very nationalistc and feel like they need to be apart of the group

CD STEP

Selling Soy Sauce in USA - How did they enter the market

american food is very heavy on sauce & they eat a lot of meat

(avg 4-5x more)

BBQ was the niche for the US market bc they sell more BBQ grills then cars in USA

introduced teriyaki sauce instead of soy sauce

once they had a bigger presence they introduced soya sauce

Why did Kikkoman struggle to enter the market in the first place

nobody eats rice in north america

unlike IKEA where you can sell a lifestyle

the sauce is only used in specific foods that westerners dont really eat

Economic Factor in Kikkoman Case

cheaper option & fast food is huge in the USA

the expat rate is very high and ppl are moving back and forth constantly

How did Matcha enter the US Market

introduced as Matcha icecream first

• sweet and cold then introduced matcha

Selling Betty Cocker in Japan - Cake Fail

cake mixes cookies biscuits etc were a fail bc DIY is a flop in Japan and also nobody has a oven

less then 2% have an oven that is suitable for baking

• instead everyone has a rice cooker which is how they tried to introduce but it was a huge fail

why did betty crocker fail in japan

bc mothers take pride in what they do therefore they are emotional standpoint and mix doesnt invoke that feeling of homecooked the gap was too big

rice is spiritual - dont mess around with the process

didnt work bc of a deep cultural stance

Barbie and Licca in Japan - Challenges

different beauty standards

beautiful = cute

STP Framework

Segmentation

Targeting

Positioning

Segmentation

creating groups based on a commonality

putting pppl in groups not bc we are similar but bc we have enough shared traits

make sure a product is customized enough so that its appealing to a group

identify & describe segments

Example Segmentation of this class

no busniess major

UBC students

similar age group

Targeting

choosing what you want to do with the groups you have just formed

Evaluate & select segments

positioning

trying to be unique for the group you’ve chosen

tailor to meet segments needs

relationship between targeting and positioning

use both initially when coming up with a busniess plan

P’s and STP relationship

Why use STP

consumers want something that is targeted to them

gives your company a huge competitive advantage

allows marketers to determine the value their product of service can deliver to customers

Segementation =? Targeting + Postitioning =?

select, differentiate

challenging process but can give a firm competitive advantage

Hertz’z Markets

demographic segmentation

most common segmentation method

based on the question - “what” kind of consumers

gender age education income family size marital status occupation

downfall of demographic segmentation

can be misleading, thus it should be used with other segmentation methods

describe demographic data

inexpensive

easy to aquire

what does a good segment have

5 good variables

out of 5, 3 should be demgraphic

less than 5 too broad

geographic segmentation

useful when consumer characteristics differ in regions

based on the question “where” are the customers

ex: rural, urban, east etc

have 1/5

behavioral segmentation

very common based on “how” customers spend?use ex: buying habits

innovators price buyers infuelncers etc

1/5

Market segmentaiton

tiered system

each tier is a different segment

Tier 1

unprofitable

but you want ppl to think you are exclusive and this needs to be unreachable

Tier 2

more mainstream brings it closer to teh regular persone

Tier 3

drives sales

Hermes Tiers

evaluating the segment

Substantial

reachable

responsive

profitable

identifiable

substantial

influential enough

continuesly growing

not just in # of ppl but how influential/impactful is the group

segment big eough for buines

reachable

effective and efficient for the company ro reach out to these segments

potential of a marketing action to reach a segment

responsive

is the customer going to respond the way you want them to respond

react positively to offerings and accept the firm’s value prop

profitabel

can i charge a price which justifies my busniess

profit potential

identifiable

hear what ehy want to hear

are the segments uniqe