Kotler POM 14 Videoguide

Chapter 1: Marketing: Creating and Capturing Customer Value

Topic: Stew Leonard’s, the world’s largest dairy store company, creates customer value by providing a unique in-store sensory experience and exceptional customer service interacting with each customer.

Learning Objectives:1. Discuss customer relationship management and identify strategies for creating value for

customers and capturing value from customers in return.

Video Title: Stew Leonard’sLink: http://media.pearsoncmg.com/ph/bp/bp_mylabs/akamai/template/video720x480.php?title=Stew%20Leonards&clip=pandc/bp/2012/MKTG/Stew_Web__Complete.mov&caption=bp/bp_mylabs/akamai/2012/MKTG/xml/Stew_Web__Complete.adb.xml

Classroom Application: The video highlights the increasing trend for companies to go to great lengths to delight (and not just satisfy) their customers. The chapter emphasizes that delighting your customers creates their loyalty to your company. Students should pick a company that they would be very interested for which to work after they graduate. Have students then go on the internet to discover if the company’s customer base is satisfied, delighted, both, or dissatisfied. Students should brainstorm promotions and strategies to delight their chosen company’s customers. That is, what should the respective company do to better delight their customer base?

SynopsisStew Leonard’s is the world’s largest dairy store company, with annual sales of over $300 million. Customers love shopping there for the unique, non-grocery store experience (i.e., described by one customer as “a feast for the senses”). The company creates customer value with its “show and sell” perspective, which shows in-store customers the freshness of its food products (e.g., breads baked, cheese made, and foods prepared right in front of the customers). The company’s first rule is that the customer is always right, and its management philosophy is to “take good care of your people, and they’ll take care of your customers.” The company leveraged its dairy store brand equity into its very successful creation of wine stores in New Jersey, New York, and Connecticut. Its wine stores employ certified wine specialists to serve their customers and emphasize “interaction over transaction,” building strong and loyal customer relationships.

Discussion Questions1. “Rule #1” for Stew Leonard’s is that the customer is always right. Do you believe that this rule helps or hurts a company’s ability to build customer relationships and satisfaction? Explain your answer.

Students will have various opinions and discussion points in response to this question. Obviously, adhering to this rule has created great success for Stew Leonard’s. Perceived customer value for this store may, in fact, be based partly or fully on this first rule. This rule directly relates to the following chapter passage regarding customer satisfaction: “Outstanding marketing companies go out of their way to keep important customers satisfied. Most studies show that higher levels of customer satisfaction lead to greater customer loyalty, which in turn

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results in better company performance.” As shown in the video, Stew Leonard’s seems to “go out of its way” to please their customers.

2. Discuss the various ways (as depicted in the video) that Stew Leonard’s creates customer delight.

The first example of customer delight is seen in customer testimonials about the company’s unique in-store sensory experience (e.g., “smells great,” is welcoming, always has something to taste, and puts you in a good mood)—the store is described as a “feast for the senses!” The second broad category of examples is made up of exceptional customer service, as the company’s wine stores have certified wine specialists ready to serve each customer as they walk in the door. As the chapter suggests, delighted customers lead to loyal customers.

3. The chapter emphasizes the trend of companies incorporating interactive approaches to build relationships with customers. How is this trend toward interaction with customers depicted in the video?

As highlighted in the video, Stew Leonard’s wine stores adopt an “interaction over transaction” emphasis with their customers. They strive to create a “family feel” by getting to know each and every customer via exceptional customer service. In particular, the owner specified that getting to know each customer’s palate via interaction with customers builds customer loyalty.

Quiz1. Stew Leonard’s provides:A. satellite radio service.B. dairy products and wine.C. shampoo.D. financial advising.Answer: B.Explanation: This is a simple, straightforward question designed to assess whether or not students paid attention to the video (instead of daydreaming).

2. Stew Leonard’s “show and sell” in-store system is designed to:A. show the freshness of its products.B. highlight product demonstrations.C. entertain customers with in-store concert performances.D. encourage customers to bring in their own home recipes.Answer: A.Explanation: Breads are baked, cheeses are made, and foods are prepared right in front of the in-store customers.

3. Stew Leonard’s management philosophy is:A. “The ends justify the means.”B. “We’ll fire any employee who doesn’t delight our customers!”C. “Take good care of your people, and they’ll take care of your customers.”D. “Quality is Job One.”

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Answer: C.Explanation: Such a philosophy has landed the company on Fortune magazine’s “100 Best Companies to Work For” list.

4. Stew Leonard’s “Rule #1” is:A. Treat others as you would want to be treated.B. The customer is always right.C. Satisfaction guaranteed!D. Work hard each and every day.Answer: B.Explanation: Management treats all customers as “good and honest.”

5. Which of the following was done or put in place when creating Stew Leonard’s wine stores?A. The company studied the wine industry.B. The company hired the finest wine experts.C. Every customer is greeted at the door with a “Can I help you?”D. All of the aboveAnswer: D.Explanation: Stew Leonard’s now has nine wine stores in three states (NJ, NY, & CT)

Chapter 2: Company and Marketing Strategy: Partnering to Build Customer Relationships

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Topic: Live Nation is a music concert promoter that connects fans and artistsLearning Objectives:

1. Explain company-wide strategic planning and its four steps.2. Discuss how to design business portfolios and develop growth strategies.

Video Title: Live NationLink: http://media.pearsoncmg.com/ph/bp/bp_akamai/kotler/Live_Nation.html

Classroom Application: The video provides a good introduction to a company’s mission statement and growth strategies. A good exercise in class would be for students to discuss Live Nation’s mission statement of connecting fans and artists. Is this a mission that will work over many years in the future or will Live Nation need to expand their mission in order to survive? In answering this question, students might want to research other music companies’ mission statements to compare and contrast with Live Nation’s mission.

SynopsisLive Nation’s mission is to connect music fans and artists through promotion of live concerts. As technology develops, Live Nation has expanded its core service of promoting the live music experience by providing alternative touch points such as merchandise and online music/concerts. The Web site, LiveNation.com, is a ticket and merchandise outlet which also provides customers with consumer promotions in order to make concerts accessible to all fans.

Discussion Questions1. Live Nation’s mission statement is to connect musical fans and artists. With this in mind, answer the following questions for Live Nation: (1) What is our business? (2) Who is the customer? (3) What do consumers value? (4) What should our business be? Does its mission statement answer these four questions soundly?

Live Nation’s original core focus was to develop concerts and shows to provide the best live music experience for fans and artists. In terms of its customers, Live Nation considers both the music fans and the artists as being its customers—both of these sets of customers value the best musical experience that Live Nation can promote and develop. Finally, Live Nation does believe that it should provide the best musical experience for fans and artists. With these considerations in mind, it appears as if Live Nation’s mission statement is a sound one.

2. How is Live Nation’s mission statement more “market oriented” (and not myopically defined)?

Although Live Nation’s original core focus was to develop live musical concerts and shows, this was not its broad mission—as technology developed, much more live music has been accessed on the Web. Live Nation’s mission of connecting fans and artists is broad enough to encompass these technology trends, and thus it is “market oriented” and defined in terms of satisfying basic customer needs (connecting fans and artists).

3. Use the product/marketing expansion grid in Figure 2.3 of the chapter to identify growth opportunities for Live Nation in the future.

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Students should brainstorm ideas for all four types of growth opportunities: market penetration, market development, product development, and diversification. Marketpenetration involves making more sales without changing its original product. Market development involves identifying and developing new markets for its current products. Product development involves offering modified or new products to current markets. Diversification involves starting up or buying businesses beyond its current products and markets. Students are creative and are particularly knowledgeable about live music and associated technology—they will generate lots of ideas for growth!

Quiz1. Live Nation provides:A. satellite radio service.B. live music experiences.C. product designs for brands.D. financial advising.Answer: B.Explanation: This is a simple, straightforward question designed to assess whether or not students paid attention to the video (instead of daydreaming).

2. Live Nation’s mission is:A. to distribute music online.B. to develop the most accessible music technology.C. to pamper the music artist.D. to connect music fans and artists.Answer: D.Explanation: Their original core focus is the development of concerts and shows.

3. In the video, a marketing executive for Live Nation states that its competition includes:A. musical artists.B. music fans.C. non-concert experiences.D. online music subscription services.Answer: C.Explanation: Live Nation strives to differentiate itself as providing the best musical experience out there.

4. Which of the following services does Live Nation provide?A. merchandiseB. online musicC. ticket salesD. All of the aboveAnswer: D.Explanation: As technology changes, Live Nation strives to develop its offerings to music fans and artists.

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5. Live Nation strives to differentiate itself as providing the best __________ out there:A. musical experiencesB. merchandiseC. online musicD. concert ticketsAnswer: A.Explanation: Live Nation perceives this as being their core benefit serving both fans and artists.

Chapter 3: Analyzing The Marketing Environment

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Topic: TOMS Shoes is a company that ships one pair of shoes to those in need for every pair of shoes bought by its customersLearning Objectives:

1. Explain how changes in the demographic and economic environments affect marketing decisions.

2. Explain the key changes in the political and cultural environments.

Video Title: TOMS ShoesLink: http://media.pearsoncmg.com/ph/bp/bp_akamai/kotler/TOMS_Shoes.html

Classroom Application: TOMS shoes is an innovative for-profit model that uses its business as a sustainable means to help people without shoes in third-world countries. A great activity for students after watching the video would be for them to brainstorm cause-related marketing ventures in the same spirit as TOMS shoes.

SynopsisTOMS shoes delivers one pair of shoes to a person in need in a third-world country for every pair of shoes bought by a customer—a business that is specified in the video as a “one-to-one” model. The owner views his business more as a beneficiary that sustains this charitable cause. By purchasing a pair of TOMS shoes, young people get a chance to participate in supporting a charitable cause. TOMS shoes takes volunteer customers with them to deliver the shoes to people in third-world countries. This practice facilitates TOMS shoes vision of creating a movement of young people for making a better tomorrow.

Discussion Questions1. The video suggests that TOMS shoes are primarily bought and valued by a younger generation. Discuss how each of the following generational groups might react to TOMS shoes: the baby boomers, Generation X, and the Millennials.

Of course, student opinions will vary. The following factors in the chapter for each generational group seem relevant to this discussion:

Baby boomers Are rethinking the purpose and value of their work, responsibilities, and

relationships Are still the wealthiest generation in U.S. history

Generation X Although they seek success, they are less materialistic They prize experience, not acquisition For many of the Gen Xers who are parents, family comes first—both children and

their aging parents—and career second. From a marketing standpoint, the Gen Xers are a more skeptical bunch. They

tend to research products before they consider a purchase, prefer quality to quantity, and tend to be less receptive to overt marketing pitches.

Millennials They don’t just embrace technology; it’s a way of life

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Rather than having mass marketing messages pushed at them, they prefer to seek out information and engage in two-way brand conversations

2. The chapter mentions the potential for controversy related to cause-related marketing: companies that engage in such practices walk “a fine line between increased sales and an improved image and facing charges of exploitation.” How do you think TOMS shoes does with respect to this controversial line?

Because TOMS shoes is a decidedly for-profit business, students may have differing opinions when discussing this question. TOMS is not a nonprofit organization, but it does utilize a business model designed to create sustainable support for its philanthropic cause. As stated in the video, TOMS goal is to create a movement of young people for making a better tomorrow. At this early stage in its existence, all signs point toward its cause-related marketing approach being sincere to its philanthropic goal to help people in third-world countries.

3. The chapter states that we “use products, brands, and services as a means of self-expression, and (we) buy products and services that match (our) views of (ourselves).” Associate this idea with TOMS shoes.

One obvious answer to this discussion question is that the business of TOMS shoes represents socially responsible values and traits. Therefore, customers may feel that showing off their TOMS shoes to others (and to themselves) communicates their own socially responsible values and traits. The chapter states that TOMS shoes customers “see themselves as part of the broader world community.”

Quiz1. TOMS provides:A. product design.B. shoes.C. live musical experiences.D. financial advising.Answer: B.Explanation: This is a simple, straightforward question designed to assess whether or not students paid attention to the video (instead of daydreaming).

2. TOMS specifies that ____________ comprise its largest customer baseA. college studentsB. high school studentsC. young peopleD. All of the aboveAnswer: DExplanation: The owner explains that TOMS was created with the young person in mind who traditionally does not get a chance to participate in giving to charities.

3. The owner of TOMS stated that _____________ is/are more sustainable than relying on donors/beneficiaries for supporting his cause.

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A. his businessB. government aidC. wealthy customersD. churchesAnswer: A.Explanation: Relying on the business to sustain the charitable donations of shoes to third-world countries is better than relying on donors for support.

4. The company’s name in the video is taken from:A. the owner’s first name.B. the owner’s last/family name.C. the word “tomorrow.”D. the book Tom Sawyer.Answer: C.Explanation: The owner views his company as more of a movement of young people for making a better tomorrow.

5. The owner of TOMS stated that his business model:A. relies on consumer promotions.B. is market share-driven.C. is profit-driven.D. is “one-for-one.”Answer: D.Explanation: For each pair of shoes sold to a customer, TOMS delivers a pair of shoes to a person in need in a third-world country.

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Chapter 4: Managing Marketing Information to Gain Customer Insights

Topic: Using online social communities to listen, analyze, and engage in brand conversations with consumers

Learning Objectives:1. Explain the importance of information in gaining insights about the marketplace and

customers.2. Define the marketing information system and discuss its parts.3. Explain how companies analyze and use marketing information.

Video Title: Radian6Link: http://media.pearsoncmg.com/ph/bp/bp_mylabs/akamai/template/video640x480.php?title=Radian6%20(Intro%20to%20Global%20Marketing)&clip=pandc/bp/2011/keegan/Radian6_Intro.mov&caption=bp/bp_mylabs/akamai/2011/keegan/xml/Radian6_Intro.adb.xml

Classroom Application: This video would be a very nice springboard for activities and discussion regarding the use of social media communities in forming and monitoring the strength of one’s brand. After watching the video, engage in initial discussions of if and how your students bring brands into their conversations on social media Web sites like Facebook. How and when is it appropriate to do so? You can then assign them the task of “listening to” (i.e., monitoring and searching) conversations about brands on social media Web sites.

SynopsisAs the textbook states in this chapter, “Radian6 helps companies to keep track of almost any relevant online conversation” about various brands. Radian6 collects brand conversations online via social media Web sites in order to allow companies to listen, analyze, and engage with their consumers. The video emphasizes both the need for a company to think global right out of the gate and the importance of listening to one’s customers in order to form meaningful and profitable relationships with them.

Discussion Questions

1. What unique benefits do social media Web sites provide regarding information in gaining insights about the marketplace and customers?

The following statements in the chapter are applicable to this question: “Each one (social media Web site) has contributed to a growing tidal wave of “bottom-

up” information that individuals volunteer to each other and to organizations. Organizations able to . . . elicit and use such [volunteered information] will be able to gain much richer, more timely customer insights at lower cost.

Social media make it easier than ever for people to share—to have conversations and express their opinions, needs, ideas, and complaints.

In addition to these ideas, social media Web sites promote sincere word-of-mouth (WOM) promotion among community members. As the video mentions, this WOM promotion provides a company a sincere form of feedback on a brand if monitored without bombarding its customers with too much “marketing goop.”

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2. Relate Radian6’s service to competitive marketing intelligence.

This service provides a unique and objective way to assess and track the consumer environment, competitors’ actions, and early warnings of opportunities and threats. A company can understand their customers and competitors by tracking brand conversations on social media Web sites.

3. In analyzing and using marketing information, how would brand conversations on social media Web sites be related to customer relationship management (CRM)?

In the video, Radian6 talks a lot about forming meaningful relationships with your customers and being part of their online communities. CRM is a tool companies use to identify profitable customers using touch points and understand their needs in building relationships with them. A social media Web site is an important customer touch point to gather important information from your profitable customers.

Quiz1. Radian6 provides:A. cell phone service.B. tracking of online conversations.C. online travel agency bookings.D. financial advising.Answer: B.Explanation: This is a simple, straightforward question designed to assess whether or not students paid attention to the video (instead of daydreaming).

2. In the video, executives at Radian6 emphasizes the importance for companies to:A. remain local.B. build up over time into breaking into the global market.C. assume global demand immediately.D. start local, then go national, then go global.Answer: C.Explanation: A main idea in the video was that technology has rendered a borderless world and marketplace. An executive in the video mentioned that for many companies, the day they provide their services online, there will be instant global demand.

3. As a company, Radian6 has:A. shown slow and steady growth over a period of many years.B. shown about 25% quarter-over-quarter growth since they started the company.C. not reached profitability yet.D. None of the above.Answer: D.Explanation: An executive in the video characterizes Radian6’s progress as a company as “rocket ship growth.”

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4. In the video, Radian6 talks about communities as:A. being based on interests.B. being based on borders.C. local and homegrown.D. exclusive and territorial.Answer: A.Explanation: In the video, communities are defined by their interests (e.g., Dachshund dog lovers) and not by their borders. For example, as an American, if you like Dachshund dogs and want to join a Facebook community of such dog lovers, you are not going to be dissuaded by the fact that the online community started among people living in Germany.

5. In order for a company to generate consumer interest in an online community, Radian6 suggests that:A. the company hire many customer service agents to encourage online customers to call them over the phone.B. the company set up a Facebook page and post advertisements for customers.C. create many consumer promotions for such customers.D. the company develop relationships with their customers by sharing with/learning from them.Answer: D.Explanation: The video emphasizes developing real connections and relationships with their customers, as opposed to blitzing them with continuously “marketing goop.”

Chapter 5 Consumer Markets and Consumer Buyer Behavior

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Topic: Description of local delivery service based on online and its operations/strategies

Learning Objectives:1. List and define the major types of buying decision behavior and the stages in the buyer

Video Title: Wild PlanetLink: http://media.pearsoncmg.com/ph/bp/bp_akamai/ebert/Wild_Planet.html

Wild Planet markets high quality, nonsexist, nonviolent toys that encourage kids to be imaginative and creative and to explore the world around them. But Wild Planet sells more than just toys. It sells positive play experiences. To better understand those experiences, the company conducts a tremendous amount of consumer research to delve into consumer buyer behavior.

Questions and Answers1. Explain how each of the four sets of factors affecting consumer behavior affects the

consumer purchase process as it relates to toys from Wild Planet.This is a very broad question and student responses will certainly vary. Students should identify the four broad categories of factors affecting consumer behavior as found in figure 5.2. Below are some examples of how each factor could affect the consumer purchase process for Wild Planet toys:

Cultural. Today’s kids are growing up in an entirely different culture than did children 25 years ago. Kids today are more savvy and sophisticate. They have always been in a world where the Internet exists. They value being asked about their opinions. Social. The case discusses the role of peer pressure (reference groups) in the buying decision of toys. But more importantly, it is recognized that even at young ages, many kids want to be the first to have the latest and greatest toy. Reference is made to the “trendsetters” (roles and status). Personal. Obviously, age and lifecycle are going to affect how people buy toys. This is true for the primary customer (the child) as well as the secondary customer (the parent). Also, the case discusses the role of gender and gender perceptions at length. This can be explained by the impact of self-concept. Psychological. Beliefs and attitudes play a major role in buying toys. Wild Planet is built around the idea that toys should be not only fun, they should be quality learning tools and help children develop various skills. Parents who agree are more likely to be drawn to Wild Planet products. Also, the case highlights how the beliefs and attitudes of girls (that their rooms should be decorated and accessorized) are different than those of boys (that toys should be for playing with).

2. What demographic segment of consumers is Wild Planet targeting?Student responses may vary. This is a good case to show the complexities of defining the customer. There are two very clear customer segments that Wild Planet is targeting: children and parents. Within those broad segments, Wild Planet certainly segments in more detail. Other demographic characteristics include gender and opinion leadership.

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3. Visit the Wild Planet Web site at www.wildplanet.com to learn more about the company. How does the Web site help consumers through the buyer decision process?Students should be able to identify something from this website in at least the first four steps of the buyer decision process: Need recognition. Assisting in this phase is subtle at best. Browsing customer may be struck with how Wild Planet toys are designed to help foster relationships with certain toys (e.g. Dino-Mites or Purse Pals). This may spark a need in the consumer’s mind if they do not have those types of toys. Information search. Websites such as the Wild Planet site are loaded with product information, thus taking advantage of the strengths of the Internet. Customers can easily gather information on any product of choice. Evaluation of alternatives. The Wild Planet site is not set up for comparison of toys for other brands. Even within the Wild Planet portfolio, the site does not seem to facilitate easy comparisons of different products, enabling potential customers to compare features. Purchase decision. Each product sub-site has a link to the Wild Planet online toy store where purchases can be made. The toy store can also be accessed from the home page.

Teaching Ideas1. Have students list the characteristics they possess that make them more or less likely to shop

at Wild Planet. Then have them consider how those characteristics will change over the next ten years. Are they more likely to patronize the company in ten years? Fifty years?

2. Have the students think about a hypothetical new toy: How might they come up with an idea for the new toy? How will they know if the product will sink or swim? Use this discussion as a lead-in to understanding Wild Planet’s research program—what it does well and how it might improve.

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Chapter 6: Business Markets and Business Buyer Behavior

Topic: Eaton belives in working closely with customers to develop better products

Learning Objectives:1. Identify the major factors that influence business buyer behavior.2. List and define the steps in the business buying decision process.

Video Title: EatonLink: http://media.pearsoncmg.com/ph/bp/bp_mylabs/akamai/template/video720x480.php?title=Eaton%20&clip=pandc/bp/2012/MKTG/Eaton_Web__Complete.mov&caption=bp/bp_mylabs/akamai/2012/MKTG/xml/Eaton_Web__Complete.adb.xml

Video SummaryEaton is one of the world’s largest suppliers of diversified industrial goods. Eaton’s products make cars more peppy, 18 wheelers safer to drive, and airliners more fuel efficient. At Eaton, B2B marketing means working closely with customers to develop a better product. So the company partners with its sophisticated, knowledgeable clients to create total solutions that meet their needs.

Questions and Answers1. What is Eaton’s value proposition?

This may be a challenging question for students to answer. One of the first things stated by Tom Schneider is that the Eaton brand is trusted as a quality product. There may be a tendency for students to focus on this as the value proposition. However, this is rather generic. There are far too many companies that claim that they stand for “quality” when it isn’t really clear what that term means.

The true Eaton value proposition evolves throughout the case and is summarized best by Mike Longman toward the end of the video. That is, that Eaton solves problems its customers by solving problems for the end customer. It does this by providing innovative solutions that are applied across multiple levels of the distribution channel.

2. Who are Eaton’s customers? Describe Eaton’s customer relationships. Eaton markets to sophisticated, discriminating customers. But the full answer to this question should revolve around the concept of the buying center in the text. The buying center establishes that there are various individuals and even departments within companies that have a vested interest in any given purchase. These include influencers, users, buyers, deciders, and gatekeepers. In the video, Mike Longmen specifically addresses three positions or levels of customer that Eaton interacts with:

Engineers who are designing things Operations people who are running things.

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General managers who are focused on the broader scope of value that can be added.

The video specifically addresses the strength that Eaton has in managing relationships with its customers. Some of this relationship management is rooted in things that are discussed in the other two questions. However, one of the principle aspects is that Eaton has a competency in resolving situations that go wrong. The executives even speak of how they view “things going wrong” as their chance to shine. Customers come to trust Eaton as it reacts in ways that demonstrate that it has the best interest of the customer in mind.

One other important elements of customer relationship management addressed in the video is the fact that the Eaton is aware that it manages multiple customer “touchpoints.” In other words, because there are so many levels to the customer, and there are so many representatives from Eaton that interact with such, it is imperative that all such interactions are managed as though Eaton is one representative.

Alexander Cutler had a quote that illustrates Eaton’s understanding of customer relationship management: “People buy from people they want to buy from.”

3. Discuss the different ways that Eaton provides value beyond what companies can provide for themselves. Eaton’s success depends on its ability to provide high quality, dependable customer service and product support. Through service and support, Eaton develops a clear understanding of consumer needs and builds stronger relationships with clients, and helps add value to its products. Some of the specific ways that Eaton adds value as per the video are as follows:

Eaton has gone from component provider to solutions provider. Eaton works multiple levels of channels that interact with each other. Eaton solves problems for its customers by solving problems for the end customer.

The customer knows what’s needed, Eaton knows what’s possible. Eaton has expertise that its customer do not have and shares it.

Eaton recognizes that it can not sell the same product every year. It has to be innovative, be worth paying a price for.

Teaching IdeasGive students two minutes to list all of the business-to-business marketers they can recall. Give them an additional two minutes to list all of the business-to-consumer marketers they can. Chances are, the list of b-to-c marketers is considerably longer. Do any marketers make both lists? Ask students to think about the enormity of the b-to-b market as compared to the b-to-c market. Why aren’t they more aware of b-to-b marketers?

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Chapter 7: Customer-Driven Marketing Strategy: Creating Value for Target Customers

Topic: The Meredith Corporation has developed an expertise in building customer relationships through segmentation, targeting, and positioning.

Learning Objectives:1. List and discuss the major bases for segmenting consumer and business markets.2. Explain how companies identify attractive market segments and choose a market

targeting strategy.3. Discuss how companies differentiate and position their products for maximum

competitive advantage.

Video Title: Meredith CorporationLink: http://media.pearsoncmg.com/ph/bp/bp_akamai/ebert/Meredith.html

Video Summary

The Meredith Corporation has developed an expertise in building customer relationships through segmentation, targeting, and positioning. But the amazing thing is that they have done this by focusing on only half of the population…the female half. By focusing on core categories of home, family, and personal development, Meredith has developed a product mix designed to meet various needs of women.

Questions and Answers1. What are the main variables that Meredith has focused on to segment its markets?

Gender. Clearly, this is the greatest area of focus. But to say that this drives Meredith’s segmentation strategy would be far too broad. This factor is more like the starting point for cutting out half the market. Life stage/Life events – this one really stands out as a factor that breaks the female market down into groups that are specific enough to have their own product or product line. The case mentions life events like having a baby, sending kids off to college, or getting ready for retirement. Other possibilities include getting married or buying a first home. Passions – this could be considered an extension of interests and hobbies. The case specifically discusses Meredith’s ingenious method (Passion Points) of gauging a customer’s level of interest in a given area such as cooking. Geographic/Demographic – The case describes how Meredith creates different versions of their bigger magazines (e.g., “Better Homes and Gardens”) across different demographic and geographic segments. For example, a special version of BHG has been offered in the past to subscribers of a particular income range.

2. Which target marketing strategy do you think best describes Meredith’s efforts? Support your choice. Of the four main targeting strategies covered in the text (undifferentiated, differentiated, concentrated, and micromarketing), Meredith clearly pursues a differentiated strategy. Meredith clearly targets several market segments and designs separate offers for each.

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For its print magazines alone, Meredith publishes hundreds of titles. Each of these is crafted to appeal to a certain kind of customer.

3. How does Meredith use its variety of products to build relationships with the right customers?Meredith’s efforts to build relationships with customers are very closely tied to its segmentation activities. Overall, Meredith’s extensive database gathers as much information as possible about a customer so that various customer needs can be met. The idea is not just to sell a person one magazine, but to create a link with a customer and then become the go-to source for multiple interest areas. For example, one person may be looking at remodeling their home, love to cook, and be have diabetes. There is a Meredith magazine for each and every one of those characteristics. Also, Meredith’s deep portfolio allows for adapting with customers as their needs change within a given interest area. For example, “American Baby” (prenatal), “Parents” (postnatal), and “Family Circle” (teens and tweens) are all designed to appeal to parents, but meet different needs depending upon life stage. Thus, a prospective parent might become a Meredith customer by subscribing to “American Baby,” and then progress through the other publications, remaining a Meredith customer for life.

Teaching Ideas1. Have students visit the Meredith website. In conjunction with the first discussion

question, have students categorize the various magazine titles according to segmentation variables.

2. Lead the class in a discussion about the future of print magazines. Have them comment and speculate on the future of this industry. Small groups could generate recommendations for a company like Meredith and how it might adapt to the changes in culture and technology. For further supplements, instructors might research the Meredith publication websites to discover what Meredith is already doing in that area.

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Chapter 8: Product, Services, and Brands: Building Customer Value

Topic: GoGurt, a yogurt tube designed for kids over six years old, repositioned itself in 2009 to appeal to “back-to-school” mothers’ needs for “freeze and thaw” yogurt.

Learning Objectives:1. Define product and the major classifications of products and services.2. Describe the decisions companies make regarding their individual products and services,

product lines, and product mixes.3. Discuss branding strategy—the decisions companies make in building and managing

theirbrands.

Video Title: GogurtLink: http://media.pearsoncmg.com/ph/bp/bp_mylabs/akamai/template/video720x480.php?title=GoGurt&clip=pandc/bp/2012/MKTG/GoGurt_Web_Complete.mov&caption=bp/bp_mylabs/akamai/2012/MKTG/xml/GoGurt_Web_Complete.adb.xml

Classroom Application:

The need for brand repositioning efforts to revive a struggling product in the marketplace is the main “take-home message” in this video. Students can get a very nice glimpse of the work a brand manager does by interviewing mothers in the marketplace (they can start by interviewing their own and their friends’ mothers!) regarding tube yogurt. Certainly, GoGurt’s brand repositioning efforts proved very successful in 2009, but perhaps they can extend their efforts to appeal to consumers others than mothers and tweens. The name “GoGurt” does not necessarily have to bring to mind a product for tweens—other consumer segments can enjoy yogurt “on-the-go,” right? The only way to begin to answer this question is to conduct marketing research, so have students team up in small groups to do such an activity and report their results to the class.

Synopsis

General Mills has a long tradition of providing food products to consumers looking for solutions to needs in their daily lives. GoGurt was first introduced in the marketplace in 1999 as a yogurt tube targeted to children over the age of six. It first positioned itself to mothers and kids as the first brand of yogurt that kids could “grab and go,” being fun to eat with “a little bit of attitude” for the tweens segment. As competition in this category increased and General Mills lost its strong share of this market, it repositioned the GoGurt brand in 2009 to reach the “back-to-school” segment by targeting mothers’ needs for a “freeze and thaw” yogurt. These repositioning efforts proved to be wildly successful, solving a need for which consumers were asking.

Discussion Questions

1. The chapter states that “when designing products, marketers must first define the core, problem-solving benefits or services that consumers seek.” What is the core customer value that GoGurt provides consumers?

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The answer to this question can be divided up by the end-user (kids) and the influencer/purchaser (mothers). Kids (particularly tweens) like GoGurt because it’s fun to “eat on the go” and has “a little bit of attitude.” Mothers like it because it provides their kids over the age of six healthy benefits (e.g., calcium and vitamin D) and because it can be freezed and thawed for their kids’ lunches.

2. Describe the benefits that the packaging of GoGurt provides consumers.

In 1999, GoGurt was the very first brand of yogurt to provide a tube for its packaging. This revolutionized the yogurt category, as now kids over the age of six (particularly tweens) could eat healthy on-the-go. The tube packaging was also designed for mothers to be able to freeze it for eventual thawing during their kids’ lunchtimes at school.

3. Do you feel that General Mills has strong brand equity?

Brand equity is defined in many different ways by many different theoretical frameworks. The chapter states that “a brand has positive brand equity when consumers react more favorably to it than to a generic or unbranded version of the same product.” Students will voice various opinions on General Mills. It should be pointed out to students that General Mills has one hundred brand in more than one hundred countries—keeping in mind the intensity of numerous competitors in any product category and marketplace, sustaining more than a hundred brands all over the world points to the incredible strength of General Mills brand equity!

Quiz1. GoGurt provides:A. entertainment.B. tube yogurt.C. pay-as-you-go cell phone service.D. transportation and limousine services.Answer: B.Explanation: This is a simple, straightforward question designed to assess whether or not students paid attention to the video (instead of daydreaming).

2. Which of the following best labels the GoGurt product?A. convenience productB. shopping productC. specialty productD. unsought productAnswer: A.Explanation: Convenience products are usually low priced and are bought frequently.

3. In 1999, GoGurt revolutionized the yogurt category by providing yogurt:A. that was fun to eat.B. with “a little bit of attitude.”C. in a tube package.D. targeted for the mature market.

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Answer: C.Explanation: Although answer choices A. & B. above were part of the brand positioning strategy, the tube packaging started the whole “grab and go” craze for yogurt.

4. In 2009, GoGurt achieved brand differentiation by:A. creating new “fun to eat” flavors.B. focusing less on the “back-to-school” market segment and more on the baby boomer market

segment. C. communicating “a little bit of attitude” to its target segments.D. creating a new “freeze and thaw” advertising and promotions campaign.Answer: D.Explanation: GoGurt’s brand repositioning efforts here were wildly successful.

5. What was the initial spark/insight behind the successful brand differentiation described in Question #4 above?

A. During a break in focus groups, mothers talked about the solution of freezing GoGurt.B. Focus groups communicated less of a need for yogurt when school starts back up after the

summer months.C. Interviews with tweens indicated an opportunity in the marketplace for a entirely new

“rebellious” yogurt product.D. Telephone survey results showed a significantly amount of apathy among consumers towards

GoGurt’s current flavors.Answer: A.Explanation: GoGurt was originally designed to be freezed and thawed, but it wasn’t until after this focus group insight that the brand realized the importance of this benefit to the “back-to-school” market segment.

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Chapter 9: Developing New Products and Managing the Product Life Cycles

Topic: General Mills breathed new life into its mature Fiber One brand by identifying an opportunity to improve the taste of its healthy food products.

Learning Objectives:1. List and define the steps in the new-product development process and the major

considerations in managing this process.2. Describe the stages of the product life cycle and how marketing strategies change during

a product’s life cycle.

Video Title: Fiber OneLink: http://media.pearsoncmg.com/ph/bp/bp_mylabs/akamai/template/video720x480.php?title=FiberOne%20&clip=pandc/bp/2012/MKTG/FiberOne_Web__Complete.mov&caption=bp/bp_mylabs/akamai/2012/MKTG/xml/FiberOne_Web__Complete.adb.xml

Classroom Application: Fiber One recognized its need to reinvigorate its mature brand by developing a new chewy bar that capitalized on the recent growth of the fiber craze. Students should form their own small “R&D” groups to develop ideas in revitalizing a current mature product/brand. Grocery stores would be an excellent source of inspiration for this assignment—require students to visit grocery stores to generate ideas here.

SynopsisFiber One, a General Mills food brand, was in danger of becoming stagnant in the marketplace around 2006. Considering General Mills philosophy of reinventing mature brands instead of letting them decline, a segmentation study for the barriers of consumption discovered that consumers did not want to make the bad taste of Fiber One’s products a part of their daily lifestyles. Fiber One recognized this finding as an opportunity to extend its product life cycle and create a wildly successful chewy bar product that blended the health of fiber with the indulgence of great taste.

Discussion Questions1. The chapter states that “Although many products in the mature stage appear to remain unchanged for long periods, most successful ones are actually evolving to meet changing consumer needs.” Describe Fiber One’s efforts in the video to evolve with their consumers.

In 2006, Fiber One conducted a segmentation study to uncover the barriers of consumption among its target consumers and discovered that consumers did not want to make the bad taste of Fiber One’s products a part of their daily lifestyles. To evolve and meet their consumers’ needs for good taste, it tested and developed a chewy bar that provided 35% fiber with the indulgence of phenomenal taste.

2. Describe the various merits and limitations of the outlined promotional budget for launching Fiber One’s new chewy bar outlined in the video.

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After developing its new chewy bar, Fiber One realized the importance of driving consumers to immediate trial. Therefore, it developed the following promotional budget for this new product:

50% of the budget went towards couponing in the first four months of the product launch. One-third of the budget went towards providing samples of the new product to

consumers. The rest of the budget went towards targeted messaging to consumers online.

Although students will generate various merits and limitations of these promotional strategies, there is no denying that their product launch was wildly successful!

3. Why was the term “cross-promotions” used at the end of the video? Link this term with its mature products.

Fiber One has expanded its product offerings to include cereal, yogurt, muffin mix, pancake mix, English muffins, and ready-to-eat breads. The brand uses cross-promotions (i.e., promotions that include and link its various products) to bring its core users to these expanded and new products and when its products are in more mature product life cycle stages as well. Fiber One likes to use its existing tools and resources to help out its products on the tail end of the product life cycle.

Quiz1. Fiber One provides:A. health insurance.B. healthy food products.C. lumber.D. occupational therapy.Answer: B.Explanation: This is a simple, straightforward question designed to assess whether or not students paid attention to the video (instead of daydreaming).

2. What is General Mills philosophy about the decline stage in the product life cycle?A. They “cut their losses” as quickly as possible and remove mature brands out of the

marketplace.B. They like to ride out the mature brand as long as possible until none of their target consumers

buy it at all.C. They don’t believe in the decline stage—there is always a way to reinvigorate mature brands.D. None of the aboveAnswer: C.Explanation: General Mills likes to reinvent their products annually with improvements in product design, refreshments in marketing mix, and honing messaging to consumers.

3. What was the key barrier to consumption on which Fiber One based their product redesign efforts?A. limited availability in grocery storesB. expensive price pointsC. unattractive brand packaging and labelingD. bad taste

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Answer: D.Explanation: In 2006, the fiber category exploded, so Fiber One conducted a segmentation study to take a hard look at their Fiber One brand.

4. Which of the following levels of fiber in a chewy bar tested out to be the target of Fiber One’s new product design?A. 20%B. 35%C. 45%D. 75%Answer: B.Explanation: This level of fiber in the new chewy bar provided motivation for consumers to buy it but also allowed Fiber One’s R&D group to make it taste phenomenal.

5. The largest part of Fiber One’s budget to launch its new chewy bar into the marketplace as devoted to:A. couponing.B. sampling.C. targeted messages to consumers online.D. billboards.Answer: A.Explanation: The new chewy bars were wildly successful, generating sales of $100 million in the first year.

Chapter 10: Pricing Strategies: Understanding and Capturing Customer Value

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Topic: IKEA creates quality, modern, and functional furniture at low pricesLearning Objectives:

1. Identify the three major pricing strategies and discuss the importance of understanding customer-value perceptions, company costs, and competitor strategies when setting prices.

2. Identify and define the other important external and internal factors affecting a firm’s pricing decisions.

Video Title: IKEALink: http://media.pearsoncmg.com/ph/bp/bp_akamai/kotler/IKEA.html

Video Summary

IKEA’s vision is, “to create a better life for the many people.” With such a magnanimous vision, strangely enough, IKEA’s core focus on price. It believes that if it can design stylish, quality, and functional furniture and household items around a low price point, that this will make more things available to more people, thus improving lifestyles.

Questions and Answers

1. What is IKEA’s promise of value? There are two possibilities here. The main mission of the company is “To create a better life for the many people.” This is a very idealistic mission statement for a furniture company. It is also a bit broad. But IKEA defines this mission further as “quality at low price.” This is the “IKEA concept” and defines how it achieves its mission. One other note that should be made is the definition of “quality” as far as IKEA and its customers are concerned. For IKEA, quality does not stop at durable or reliable. About one minute in to the video, there is a set of phrases displayed. These include, “People-focused and child-friendly,” “Modern not trendy,” and “Reflecting Swedish lifestyle.” Each of these could be discussed in depth as to how it relates to product quality. Note however that in accordance with the IKEA concept, the central phrase on that particular screen is, “We design the price tag first.”

2. Referring to the Klippan sofa, illustrate how IKEA delivers its promise of value to consumers. The discussion of this question should center around the promise-of-value as defined in question 1. The quality component of the IKEA concept can be noted as follows: Modern, not trendy: The sofa is sleek and stylish, but it has been in the IKEA

catalogue of products since the early 1980s without any major design change. One of the other things that has given this sofa longevity is that it has a removable slipcover. That means, the looks of the sofa can be changed from time to time for the customer. It also means that IKEA can come out with a sofa that looks up-to-date, but is really the same sofa as before.

Reflecting Swedish style: The basic design of this sofa is simple, clean, and angular. It is modern, simple, casual, and informal.

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People-focused and child-friendly: The basic Klippan sofa is a two-seat sofa. But it is “big.” It can really seat three comfortably. So, it is somewhere in between a loveseat and a full-sized sofa. This is conducive to lounging and relaxing. The removable slipcover is also people-focused because it allows for customization, not only at the point of purchase, but even years after the product is purchased. As far as child-friendliness is concerned, this sofa is very durable (this note is being prepared by a Klippan sofa owner with two small children). The removable slipcover is also perfect because it can be taken off, washed in a standard washing machine, and put back on with little trouble. If the slipcover ever becomes stained or damaged, a new one can be purchased.

Low price: The basic Klippan sofa is less than $250 with a basic single-color slipcover. Additional slip covers can be purchased for as little as $35.

3. Based on the concepts from the text, does IKEA employ a value-based pricing approach or a cost-based pricing approach? Support your answer. Value-based pricing uses buyers’ perceptions of value, not the seller’s cost, as the key to pricing. Cost-based pricing involves setting prices based on the costs for producing, distributing, and selling the product PLUS some margin that allows for making a profit. The illustration of this is Figure 10.2.

Answering this question may lead to a lively debate among students in the class. Because of IKEA’s relentless focus on costs, it would be very easy to jump to the conclusion that IKEA has a cost-based pricing strategy. However, a true cost-based pricing strategy is dictated by a “product forward” process. In other words, it designs the product, figures out all the costs, marks it up, then determines a price. Such companies are left with the challenge to communicate to the customer the value of the product at that price.

It should be evident from the video that this is not the way that IKEA operates. IKEA starts with the customer and an understanding of what the customer values. That includes not only things such as function and style, but it includes price. What is the customer willing to pay for a product such as ____________? Once that is established, then a cost structure is determined and the product is designed. If the product cannot be designed within that cost structure, then iterations are performed between design and marketing to determine if anything can be revised. If not, the concept is shelved as something that wouldn’t work. Thus, IKEA’s pricing strategy is very clearly value-based. Specifically, it follows good-value pricing concepts.

Teaching IdeasContact IKEA ahead of time and get a copy (or multiple copies) of the IKEA catalogue. As a follow-up to question 2, have students browse the catalogue (or sections of it) to come up with as many examples as possible of products the reflect IKEA’s promise of value. As these examples are compiled, have the class make some conclusions about how IKEA makes life better “for the many people.”

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Chapter 11: Additional Pricing Considerations

Topic: Smashburger provides a quality burger for a premium priceLearning Objectives:

1. Explain how companies find a set of prices that maximizes the profits from the total product mix.

2. Discuss how companies adjust their prices to take into account different types of customers and situations.

3. Discuss the key issues related to initiating and responding to price changes.

Video Title: SmashBurgerLink: http://media.pearsoncmg.com/ph/bp/bp_mylabs/akamai/template/video720x480.php?title=Smashburger&clip=pandc/bp/2012/MKTG/Smashburger_Web__Complete.mov&caption=bp/bp_mylabs/akamai/2012/MKTG/xml/Smashburger_Web__Complete.adb.xml

Classroom Application: Smashburger recognized a gap in the marketplace and designed their business and product around filling that gap. A fun exercise for students would be for them to attempt to identify gaps in the burger restaurant industry and brainstorm product concepts to fill those gaps. For example, there don’t seem to be too many upscale restaurants that focus on burgers—is there a reason why?

SynopsisRecognizing a gap in the “burger joint” marketplace, Smashburger provides a quality burger with quick service for premium prices. They aim to provide the speed of McDonald’s in serving their gourmet quality burgers and side dishes to achieve their premium pricing strategy. They seek to steal consumers who like to go to casual dining restaurants (e.g., Applebees) and spend ~$12 per meal. The price range for a burger and gourmet side at Smashburger is $8 to $10, and they provide an environment and service that justifies their premium price point (e.g., table service and upscale serving baskets).

Discussion Questions1. Combo meals at fast-food restaurants are a great example of product bundle pricing, which the chapter defines as offering a bundle of products at a reduced price. Do you prefer to order your food at restaurants this way? Would Smashburger’s a la carte pricing scheme turn you off or attract you more? Explain.

Students will obviously have various opinions, but in all likelihood, most college students are very accustomed to buying combo meals from fast-food restaurants. How much value or discount do they perceive they get from buying a combo meal?

2. Smashburger says in the video that they do not offer any discounts to customers. Do you think this is a good strategy for them?

Students will obviously have various opinions, but most students (and consumers in general for that matter!) expect discounts from time to time.

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3. Smashburger states in the video that they wanted to initiate their products with high starting prices because they thought it would be too difficult to raise prices down the line if they started with low prices. What is your opinion of this strategy?

The chapter indirectly references the price-quality heuristic in talking about buyer reactions to price changes. That is, when prices increase, consumers typically associate such increases with better quality in the product (and vice-versa). Do students believe this effect would happen with burger joints?

Quiz1. Smashburger provides:A. fast food.B. premium burgers and sides.C. Happy Meals for kids.D. soda.Answer: B.Explanation: This is a simple, straightforward question designed to assess whether or not students paid attention to the video (instead of daydreaming).

2. Smashburger realized the following gap in the “burger joint” marketplace:A. cheap fast foodB. a gourmet burger restaurant in which reservations were requiredC. drive-in deliver formatD. premium-priced burgers served as quick as McDonald’sAnswer: D.Explanation: A gap in the marketplace presents great opportunity for new businesses.

3. When Smashburger tested their new concept before they opened, they discovered:A. 100% “top-box” satisfaction levels among respondents.B. a lukewarm response.C. a desire among respondents for a chicken club sandwich.D. None of the aboveAnswer: A.Explanation: Concept testing before a new launch increases your odds for success.

4. Smashburger’s price range for a meal was mentioned in the video to be: A. $1 to $3B. $4 to $7C. $8 to $10D. $15 to $20Answer: D.Explanation: This price range provides a valued alternative to casual dining restaurants such as Applebees.

5. Smashburger uses:A. a la carte pricing.

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B. combo pricing.C. market-penetration pricing.D. everyday low pricing.Answer: A.Explanation: Debundling menu items allows customers to customize their orders.

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Chapter 12: Marketing Channels: Delivering Customer Value

Topic: Progressive attains the status of the third largest auto insurance group in the country, by not only focusing on growth, but also by focusing on innovation.

Learning Objectives:1. Explain why companies use marketing channels and discuss the functions these channels

perform.2. Identify the major channel alternatives open to a company.

Video Title: ProgressiveLink: http://mediadev.pearsoncmg.com/ph/bp/bp_akamai/armstrong/Progressive.html

Video Summary

Progressive has grown into the third-largest auto insurance group in the country, attaining its status by not only focusing on growth but by focusing on innovation. Some of Progressive’s most innovative moves have involved its channels of distribution. Whereas most insurance companies distribute their products to consumers via intermediary agents or direct-to-consumer methods, Progressive was one of the first companies to recognize the value in doing both.

Questions and Answers1. Apply the concept of the supply chain to Progressive.

As per chapter 10, the concept of supply chain management deals with “managing upstream and downstream value-added flows of materials, final goods, and related information among suppliers, the company, resellers, and final consumers.” This concept is probably much more easily applied to examples involving tangible products. In this case, Progressive is creating and distributing an intangible service.

One approach that students might take for this is to list out the possible participants in the supply chain, then discuss the extent to which each applies to Progressive. For example, there really are no suppliers for Progressive’s insurance products (at least, none that are mentioned in this case). The company manages the flow of “product” and related information with its agents as well as directly to its customers. With respect to its agent channel, Progressive has nurtured these relationships for over 40 years. Progressive supplies these resellers with training, product information, financial incentives (commissions), and flexible pricing for products. For Progressive’s direct channel, the company communicates to customers through mass-media advertising (this has also had an incidental effect on increasing brand awareness for customers shopping through agents). It also communicates through its website. Various features are given through this medium for customers to become educated about Progressive’s products. Direct customers can then interact with the company and purchase product in two ways, by telephone or through the Internet.

2. Using the model of consumer and business channels found in the chapter, sketch out as many channels for Progressive as you can. How does each of these channels meet distinct

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customer needs?

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3. As discussed in the first question, Progressive distributes through two main channels:

ProgressiveAgents Consumer segment 1

The customers in this segment need more hand’s on help from someone in determining the type of policy and coverage that they might need. This customer may not be Internet savvy. They also may want to go to a source that has multiple options in terms of companies to choose from.

Progressive Consumer segment 2

Customers in this segment are looking for benefits of control and convenience. The customer is in control of the process from start to finish. If they choose, they never have to talk to a representative of the company. Such customers can also access the company and even make purchases any time of day from any location. Cross-shopping customers also may be even more attracted to this channel as cross-company comparisons are made readily available as clearly and easily as if shopping for a consumer good through a shopping engine.

note: some students may include more than one channel for direct to consumer. 800-call centers are one channel with the customers calling in, and the Internet is another channel.

4. Discuss the various ways that Progressive has had an impact on the insurance industry. Responses here should focus on the innovations that Progressive has pioneered in this industry. Progressive was the first insurance company to: start a website. sell an insurance product on the Internet. provide an easy comparison to competing company’s products. offer online claims services. include a “call me” button on the website to speak with a representative. provide text messaging bill reminders. provide concierge claim processing. put response vehicles on the road.

Teaching IdeasIn addition to the concepts covered in the discussion questions, a good class discussion may focus around the concept of channel conflict. Lead a discussion that centers on the synergy achieved through promoting the direct-to-consumer channels with mass-media advertising. How did this benefit the agency channel? One point that should be brought out is that even after selling online for over 10 years, the agency channel still comprises 65% of Progressive’s business and is much larger than it was pre-Internet. Be sure that the discussion touches upon how choosing to go with a dual-channel strategy could produce significant channel conflict. How might Progressive’s direct strategy have clashed with the agency network?

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Chapter 13: Retailing and Wholesaling

Topic: Zappos, an online shopping retailer, strives to provide world-class customer serviceLearning Objectives:

1. Explain the role of retailers in the distribution channel and describe the major types of retailers.

2. Discuss the major trends and developments in retailing.

Video Title: ZapposLink: http://media.pearsoncmg.com/ph/bp/bp_mylabs/akamai/template/video640x480.php?title=Zappos:%20Competitive%20Strategy&clip=pandc/bp/2010/management/zappos_comp_strat_2010.mov&caption=bp/bp_mylabs/akamai/2010/management/xml/zappos_comp_strat_2010.adb.xml

Classroom Application: After watching the video, have students go on the Zappos Web site and search for evidence that Zappos truly does deliver world-class customer service. Compare and contrast similar Web site retailers with Zappos to determine if Zappos holds a competitive advantage for customer service. Students can report their findings in a presentation format.

SynopsisZappos is an online retailer of shoes, clothing, handbags, and other products. Its primary mission is to deliver world-class customer service in order to hold a distinctive edge over its competitors. The company’s founder has designs on opening hotels and an airline someday. Zappos has experienced success and growth to the point where Amazon.com recently purchased the company based on its shared goal of world-class customer service.

Discussion Questions1. Use Table 13.1 “Major Store Retailer Types” in the chapter to discuss what type of retailer Zappos is.

Even though Zappos is an online service, the best characterization of the company would be a specialty store at this point in their life cycle—the specialize in shoes, clothing, and handbags. However, the company states the desire to expand their offerings into hotels and an airline. It is arguable that Zappos strives to become a superstore retailer.

2. In terms of amount of service shown in the video, how would you characterize Zappos: a self-service, limited-service, or full-service retailer?

Despite their online status as a retailer, Zappos strives and focuses to be a full-service retailer. The video mentions an 800-number to call day or night to talk to a knowledgeable and entertaining employee who is empowered to help. Such customer service representatives have no scripts or call-time limits and offer free overnight shipping and postage-paid returns to their customers.

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3. The chapter states that “Americans are increasingly avoiding the hassles and crowds at malls by doing more of their shopping by phone or computer.” As a consumer, discuss the advantages and disadvantages of online retailing.

Students will have various opinions regarding the online retailing experience. There are obvious trade-offs for consumers that decide between doing their shopping online vs. going to a traditional brick-and-mortar store—the classic “bricks vs. clicks” debate. The chapter suggests that online and physical retail shopping is used in conjunction with one another to achieve the unique benefits of both. Online shopping provides a great information-search consumer experience, whereas going to the actual store to physically experience the tangible product is typically a necessary step in the alternative evaluation and purchase decision stages. Would you make an extremely importance purchase solely as an online buy without holding the product in your hands?

Quiz1. Zappos provides:A. satellite radio service.B. a diet and food-delivery service.C. online shopping.D. grocery stores.Answer: C.Explanation: This is a simple, straightforward question designed to assess whether or not students paid attention to the video (instead of daydreaming).

2. What is Zappos’ core competency?A. high-end, luxury shoesB. effective supply chain managementC. low pricesD. customer serviceAnswer: D.Explanation: Early on in its life as a company, Zappos chose long-term sustainability over short-term profits to ensure this core competency.

3. Whenever you call Zappos’ 800-number day or night, you talk to a(n) _____________ employee.A. knowledgeableB. entertainingC. empowered-to-helpD. All of the aboveAnswer: D.Explanation: As a consumer, can you claim to have such an experience with other online retailers?

4. Which of the following companies recently purchased Zappos?A. AmazonB. Google

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C. FacebookD. MicrosoftAnswer: A.Explanation: Both Zappos and Amazon share the same goal of world-class customer service.

5. What does Zappos do when they can’t find what you want to buy?A. Send you a gift certificate B. Recommend one of their competitorsC. ApologizeD. Send you a “rain-check”Answer: B.Explanation: The video mentions that Zappos has a “Zen-like” focus on bringing happiness to their customers.

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Chapter 14: Communicating Customer Value: Integrated Marketing Communications Strategy

Topic: Crispin Porter + Bogusky has been working over time to prove that it is the most innovative firm at truly integrating marketing promotions.

Learning Objectives:1. Discuss the changing communications landscape and the need for integrated marketing

communications.2. Outline the communication process and the steps in developing effective marketing

communications.

Video Title: Crispin Porter + BoguskyLink: http://media.pearsoncmg.com/ph/bp/bp_akamai/ebert/CP_B.html

Video Summary

Crispin Porter + Bogusky has been working over time to prove that it is the most innovative firm at truly integrating marketing promotions. Crispin has worked miracles for companies like Virgin Atlantic Airways and BMW’s MINI by executing non-traditional campaigns designed to work within limited budgets. Crispin’s unique capability to balance strategy with creativity is what produced such ground breaking efforts as the “Truth” campaign, a campaign that shaped the agency and changed the nature of social advertising forever.

Questions and Answers1. Alex Bogusky once said, “Anything and everything is an ad.” What does this means?

How is CP + B demonstrating this mantra? When most people think of an “ad”, they think of the traditional media such as broadcast, print, and outdoor (e.g., billboards). But because CP+B has become so adept at thinking outside the box, it employs various non-traditional media. CP+B’s philosophy is that any message communicated through a medium of any kind can be an ad. Thus, they have defined events, rallies, video games, apparel, and websites as ads.

2. In what ways has CP + B differentiated itself from other advertising agencies?While this case does not discuss other agencies specifically, it does point out various things that make CP+B unique and therefore differentiate it from others. These include:

a. the culture – people who work at CP+B are workaholics. Not for the common workaholic reasons, but because they feel that they are part of something truly unique, truly different.

b. non-traditional approach – many agencies are focusing on integrating marketing communications across different media. But CP+B has a knack for employing things that are totally out of the norm.

c. size – it is a big agency that thinks and functions like a small one. d. taking on the impossible – CP+B is at its best when signing up for something that

others in the industry say can not be done.

3. Give some examples as to how CP + B balances strategy with creativity.“Truth” campaign is the only basis for example in this case. In examining this campaign,

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it is apparent that the strategy was to create a message that would communicate the idea of rebelling against the “man,” or, Big Tobacco. This strategy also involved creating a brand with which the target market could identify. This portion of the process could be considered CP+B’s definition of the problem.

After having defined the problem, CP+B used this strategy as an umbrella. It then employed one of its greatest strengths…creating ideas. As stated in the case, those ideas can come from anywhere…a creative director, an intern, or a secretary. This is what takes CP+B into employing tradition (ads and PR) as well as non-traditional (events, rallies, gear, apparel, websites) methods. The key is that the company doesn’t just throw darts and do something zany because it is zany. It looks for ways to communicate a message that fall in line with the established strategy. Thus, everything from the apparel to the ad “Body Bags” communicated the strategic message of rebelling against Big Tobacco.

Teaching IdeasCrisping Porter + Bogusky has created some really ground breaking campaigns. The “Truth” campaign is only one of them. Gather information, print, and broadcast ads from other campaigns such as CP+B’s efforts with Burger King over the past few years. Presenting this material in class along side the video case will combine to make a truly informative as well as entertaining presentation.

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Chapter 15: Advertising and Public Relations

Topic: E*Trade, a do-it-yourself investment and trading Web site, broke through the clutter with its popular baby ads during the Superbowl

Learning Objectives:1. Describe the major decisions involved in developing an advertising program.

Video Title: E*TradeLink: http://media.pearsoncmg.com/ph/bp/bp_akamai/kotler/ETRADE.html

Classroom Application: Running a commercial during the Superbowl is an extremely expensive and risky proposition. Airtime for a 30-second ad during the 2011 Superbowl cost upwards of 3 million dollars. E*Trade’s “talking baby” ads have enjoyed a near-decade long run during each of the Superbowls played during this span. Get your students to discuss their own explanations for why these “talking baby” ads have been extraordinary in breaking through the clutter (i.e., a theory-building exercise). You might also want to separate them into small groups for a creative exercise in brainstorming new ideas for E*Trade ads. That is, the “talking baby” ads cannot run forever, right?

SynopsisE*Trade allows consumers to easily invest and trade by themselves on its Web site platform, effectively taking control from the banks and placing it in the hands of consumers for an inexpensive price. For about a decade now, the company had enjoyed enormous success from running commercials during the Superbowl that have generated great buzz (e.g., ads with a talking baby) and directed consumers to their Web site.

Discussion Questions1. The video describes E*Trade’s AIDA model approach to advertising. Discuss the three main advertising objectives from the chapter implied in this model approach.

AIDA stands for Awareness, Interest, Desire, and Action. The chapter specifies three main advertising objectives: to inform, persuade, and remind. E*Trade’s AIDA model by way of its series of commercials in the video essentially accomplishes all three specified advertising objectives in the chapter. Students should be encouraged to use Table 15.1 “Possible Advertising Objectives” in the chapter to identify specific objectives that E*Trade’s commercials seem to have accomplished.

2. What was the message strategy for the “talking baby” ads?

Message strategy is defined in the chapters as “the general message that will be communicated to consumers.” The general message communicated in these E*Trade set of ads was that investing and trading on E*Trade’s Web site is easy to do (so easy that a baby can do it!) and it is inexpensive (thus saving the baby enough money to rent a clown!). The talking baby in the ads

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represented the creative concept to bring the message strategy to life in a distinctive and memorable way.

3. The chapter emphasizes the importance of measuring advertising effectiveness and the return on advertising investment. What evidence is presented in the video that E*Trade’s Superbowl commercials have been effective for the company?

The chapter states that “advertisers should regularly evaluate two types of advertising results: the communication effects and the sales and profit effects.” In terms of communication effects, the video mentioned that E*Trade’s commercials generated tremendous buzz and “water cooler chatter,” with “tens of thousands” of new consumers checking out their Web site. Additionally, the “talking baby” ads are some of the most viewed videos on YouTube. In terms of sales and profit effects, the video does compare the cost of the commercials to air during the Superbowl vs. the risk assumed on ROI (Return On Investment). Even though no sales or profit statistics were mentioned in the video, it is reasonable to assume given E*Trade’s decade-long run of Superbowl ads that they have associated increased sales and profits with their Superbowl ads.

Quiz1. E*Trade provides:A. online furniture swapping among consumers.B. do-it-yourself online investing.C. online shopping for shoes, handbags, etc.D. outdoor outfitter products.Answer: B.Explanation: This is a simple, straightforward question designed to assess whether or not students paid attention to the video (instead of daydreaming).

2. E*Trades “AIDA” model stands for:A. Accounts, Investments, Diversification, and AllowanceB. AIDing AccountsC. Awareness, Interest, Desire, and ActionD. None of the aboveAnswer: C.Explanation: The goal for their model is to engage the consumers in their brand by way of great advertising.

3. As highlighted in the video, E*Trades most popular commercials involve:A. fireworks.B. sports celebrities.C. horses.D. a talking baby.Answer: D.Explanation:

4. E*Trade’s “talking baby” commercials effectively communicated its:A. ease of use.

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B. ability to save consumers money.C. Both A. & B.D. Neither A. nor B.Answer: C.Explanation: This set of commercials are among the most viewed ads on YouTube.

5. The video mentions that E*Trade’s storefront is:A. its Web site.B. located in NYC.C. on the first floor of its corporate headquarters.D. not effective enough to pull consumers in.Answer: A.Explanation: E*Trade’s mobile platform on its Web site allows consumers to take control over their portfolios.

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Chapter 16: Personal Selling and Sales Promotion

Topic: Nestle Waters, a bottled water producer, centralized their sales force, resulting in more sales and better in-store promotionsLearning Objectives:

1. Discuss the role of a company’s salespeople in creating value for customers and building customer relationships.

2. Identify and explain the six major sales force management steps.3. Explain how sales promotion campaigns are developed and implemented.

Video Title: Nestle WatersLink: http://media.pearsoncmg.com/ph/bp/bp_mylabs/akamai/template/video720x480.php?title=Nestle&clip=pandc/bp/2012/MKTG/Nestle_Web__Complete.mov&caption=bp/bp_mylabs/akamai/2012/MKTG/xml/Nestle_Web__Complete.adb.xml

Classroom Application: After watching the video, a good pre-discussion exercise of sales force management would be to have students jot down their thoughts about a possible career as a sales force rep. They may exhibit different desires for such positions based on the industry for which one is a sales force rep. For example, while many students do not actively voice their desire to sell soap, many are interested in being a pharmaceutical sales representative (particularly because of how lucrative it can be as a career!).

SynopsisNestle Waters is a bottled water producer of such brands as Perrier, Poland Spring, Deer Park, and Nestle Pure Life. Bottled water sales started to slow down as the economic recession started in 2008 and backlash from consumer environmentalist groups increased. The company’s reaction was to centralize its sales force and align its marketing, sales execution, supply chain, and whole organization, making their sales team a much more cohesive force. The results of these changes included negotiating more consumer interruptions throughout grocery stores and increased sales and in-store brand promotions.

Discussion Questions1. The role of the Nestle Waters’ sales force in the video seems focused on heavy and intense negotiations with grocery store managers for shelf space and consumer promotions around the store. Would you be up to this type of challenge?

Students will generate many different responses to this question. Students should be encouraged to discuss what types of personality traits are necessary in such negotiations. Does one have to be “bull-headed” to succeed in this type of situation? Is this a “hard-sell” situation? What “give-and-take” gestures would be appropriate?

2. Given the information supplied in the video, what’s your guess as to how Nestle Waters structures their sales force?

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The chapter lists three formal sales force structures: territorial-based, product-based, and customer-based. The most likely choice is the territorial sales force structure: from the information in the video, Nestle Waters sells only one product line to one industry with customers in many locations. However, Nestle Waters is one product in a line of products provided by its parent company, Nestle; therefore, it is also likely that it might be a part of a broader product sales force structure or a customer sales force structure (or a combination of the two).

3. The video shows large point-of-purchase (POP) promotion displays associated with the Superbowl in grocery stores. Do you enjoy such displays? Do they influence you to consider and/or purchase the brand?

Students will voice various opinions to this question. The week leading up to the Superbowl is exciting for grocery store brands of food, as many are planning their snacks and parties for the big game.

Quiz1. Nestle Waters provides:A. swimming pools.B. water filtration systems.C. chocolate.D. bottled water.Answer: D.Explanation: This is a simple, straightforward question designed to assess whether or not students paid attention to the video (instead of daydreaming).

2. Nestle Waters manufactures:A. Perrier.B. Poland Spring.C. Deer Park.D. All of the aboveAnswer: D.Explanation: Their Perrier brand really started the bottled water craze that we see today.

3. The video focuses on the challenge for sales reps to negotiate which of the following with store managers?A. store employeesB. store customersC. product location/shelf spaceD. priceAnswer: C.Explanation: Competition for shelf space between bottled water brands is apparently fierce!

4. What was the nature of the backlash against bottled water mentioned in the video?A. environmental footprintB. sweatshop manufacturing

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C. greedy CEOsD. deceptive advertisingAnswer: A.Explanation: Consumer environmentalist groups started to promote tap water around the same time when the economic recession hit in 2008.

5. The term “consumer interruptions” mentioned in the video refers to:A. customer complaints.B. product placement around the store.C. sales reps putting the “hard-sell” on grocery store customers.D. None of the aboveAnswer: B.Explanation: Centralizing the sales force directly resulted in negotiating more consumer interruptions for the product in the stores.

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Chapter 17: Direct and Online Marketing: Building Direct Customer Relationships

Topic: Zappos, an online marketing retailer, focuses on two-way communication between its employees and its customers

Learning Objectives:1. Define direct marketing and discuss its benefits to customers and companies.2. Explain how companies have responded to the Internet and other powerful new

technologies with online marketing strategies.

Video Title: Zappos (Direct and Online Marketing)Link: http://media.pearsoncmg.com/ph/bp/bp_mylabs/akamai/template/video640x480.php?title=Zappos%20ch11&clip=pandc/bp/2011/armstrong/Zappos_ch11.mov&caption=bp/bp_mylabs/akamai/2011/armstrong/xml/Zappos_ch11.xml

Classroom Application: Zappos’ whole culture and philosophy hinge on two-way communication between employees and customers. A key consequence of its culture is its extraordinary customer service provided to its customers. Encourage students to call up Zappos’ customer service representative to act as mystery shoppers (if not actual shoppers!) to see if this culture and philosophy shines through in the interactions between students and customer service representatives. Encourage students to test Zappos’ willingness to engage in lengthy conversations with its customers. Students should present their findings to the class.

SynopsisZappos is an online retailer of mostly fashion products (shoes, handbags, apparel). The company prides itself on a two-way communication process between its employees and its customers to build trust and comfortable transactions. Its ten core values empowers its customer service representatives to provide extraordinary customer service.

Discussion Questions1. Discuss the benefits of Zappos as a direct marketing retailer for both the buyer and the seller.

The chapter provides a list of various benefits for both parties that are directly exhibited in the video, including:

For buyers, direct marketing is convenient, easy, and private. Direct marketers never close their doors, and customers don’t have to trek to and through stores to find products.

Direct marketers can offer an almost unlimited selection to customers almost anywhere in the world. Direct retailer Zappos.com stocks more than 2.7 million shoes, handbags, clothing items, and accessories from more than 1,300 brands.

Finally, direct marketing is immediate and interactive: Buyers can interact with sellers by phone or on the seller’s Web site to create exactly the configuration of information, products, or services they desire and then order them on the spot.

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For sellers, direct marketing is a powerful tool for building customer relationships. Direct marketing gives sellers access to buyers that they could not reach through other

channels.

2. The chapter provides the label of “click-only companies” for e-retailers such as Zappos. Do you enjoy the process of clicking your mouse to purchase your fashion items?

Students will have various opinions to this question. This is the classic “bricks vs. clicks” marketing discussion. However, the chapter labels brick and mortar retailers that have now embraced the online sales channels as “click and mortar” companies. Zappos does not have a brick-and-mortar component to its company—ask students if this will eventually put them at a disadvantage compared to “click and mortar” companies.

3. Which of the following four major online marketing domains can you apply to Zappos: Business-to-consumer (B-to-C), business-to-business (B-to-B), consumer-to-consumer (C-to-C), and consumer-to-business (C-to-B)?

The obvious relevant domain is B-to-C: businesses selling goods and services online to final consumers. The video does not highlight any B-to-B interaction, but that is not to say that Zappos does not or cannot exist in this domain. The C-to-C domain does not seem to apply to Zappos, as this company is an e-retailer. Finally, to the extent that the customer is given more power in the eyes of the company, the C-to-B domain applies. Zappos certainly values their customers’ opinions, suggestions, and questions, and their Web site solicits as such from them.

Quiz1. Zappos provides:A. satellite radio service.B. a diet and food-delivery service.C. online shopping.D. grocery stores.Answer: C.Explanation: This is a simple, straightforward question designed to assess whether or not students paid attention to the video (instead of daydreaming).

2. Zappos likes to specifically hire ______________ employees.A. confidentB. extrovertedC. drivenD. humbleAnswer: D.Explanation: “Be humble” is one of the ten core values of Zappos listed in the video.

3. Zappos:A. focuses on selling a product during the customer service experience.B. markets itself every chance it gets.C. lets its customer service reps talk as long as a customer wants to talk.

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D. None of the aboveAnswer: C.Explanation: Zappos feels that two-way communication between its employees and customers is the best way to build its base.

4. Zappos likes to hire applicants with:A. extensive customer service experience.B. no customer service experience.C. a moderate amount of customer service experience.D. great recommendations from previous employers.Answer: B.Explanation: They don’t have to untrain employees bad customer service habits if they have no such experience.

5. Which of the following is a core value of Zappos?A. Deliver wow through serviceB. Build open and honest relationships with communicationC. Do more with lessD. All of the aboveAnswer: D.Explanation: The video lists 10 different core values for Zappos.

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Chapter 18: Creating Competitive Advantage

Topic: UMPQUA Bank creates “a different kind of customer experience” with its nontraditional banking design elements.

Learning Objectives:1. Discuss the need to understand competitors as well as customers through competitor

analysis.2. Explain the fundamentals of competitive marketing strategies based on creating value for

customers.

Video Title: Umpqua BankLink: http://media.pearsoncmg.com/ph/bp/bp_akamai/kotler/UMPQUA_Bank.html

Classroom Application: UMPQUA certainly seems like a different and unique banking experience with its nontraditional banking design elements (coffee, WiFi, and comfortable chairs). Students can be encouraged to apply this same business model to other traditional service industries in order to create “a different kind of customer experience.” Do all companies that provide such unique experiences succeed in creating competitive advantage?

SynopsisUMPQUA Bank strives to be “the world’s greatest bank” by providing “a different kind of design” and “a different kind of customer experience.” Their business model focuses on differentiating the design of the bank “store,” with large spaces for customers to hang out, drink coffee, surf the Web, and stay awhile in the beautiful space. The company strives to replicate the experience of a nice hotel, a restaurant with good service, and a fine retailer. As such, UMPQUA Bank deviates from the traditional banking industry model.

Discussion Questions1. The video implies that UMPQUA Bank uses its design to create a competitive advantage in the marketplace. What design elements are highlighted in the video that create an experience in which customers want to hang out and stay awhile?

The design space of the bank resembles less of a traditional bank and more of a nice hotel lobby with a large space outfitted with comfortable chairs, coffee stations, and WiFi. You certainly don’t expect to linger, enjoy coffee, and surf the internet at a traditional bank! UMPQUA Bank believes that their competitive advantage in design leads to “a different kind of customer experience.”

2. The chapter outlines various competitive positioning strategies (seven strategies in all) that companies can follow. Which of these strategies do you feel characterizes UMPQUA’s approach?

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Students may have various opinions about which of the seven strategies apply to UMPQUA. The chapter provides the following information for the seven strategies:

Overall cost leadership: Here the company works hard to achieve the lowest production and distribution costs.

Differentiation: Here the company concentrates on creating a highly differentiated product line and marketing program so that it comes across as the class leader in the industry.

Focus: Here the company focuses its effort on serving a few market segments well rather than going after the whole market.

Middle-of-the-road: Try to be good on all strategic counts (but end up being not very good at anything).

Operational excellence: The company provides superior value by leading its industry in price and convenience.

Customer intimacy: The company provides superior value by precisely segmenting its markets and tailoring its products or services to exactly match the needs of targeted customers. It specializes in satisfying unique customer needs through a close relationship with and intimate knowledge of the customer.

Product leadership: The company provides superior value by offering a continuous stream of leading-edge products or services.

While elements in the video may point to a number of different strategies above, it is evident that the following strategies do NOT apply to UMPQUA’s approach: overall cost leadership and middle-of-the-road.

3. Would you characterize UMPQUA Bank as a market-centered company? Discuss.

The chapter states that such companies pay “balanced attention to both customers and competitors.” UMPQUA obviously derived its current strategy by analyzing both what customers want in a banking experience and its competitor’s deficiencies in providing that experience. However, in the video, it is not totally clear whether UMPQUA’s design is more about what other banks don’t provide and less about what their customers want—notice that all of the following slogans/taglines highlight differentiation from competitors:

“Welcome to the world’s greatest bank” “A different kind of service” “A different kind of customer experience” “The revolution is coming!”

Quiz1. UMPQUA provides:A. soda.B. online investing and trading.C. guitars.D. banking.Answer: D.Explanation: This is a simple, straightforward question designed to assess whether or not students paid attention to the video (instead of daydreaming).

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2. Which of the following slogan’s highlights UMPQUA’s vision?A. Welcome to the world’s greatest bank.B. Banking made simple.C. Making your money work for you.D. Getting you the answers you need fast.Answer: A.Explanation:

3. UMPQUA’s business model is to:A. ride on the coattails of bigger banks.B. turn the industry on its head.C. think local, go global.D. blend into the banking marketplace.Answer: B.Explanation: The company mentioned that they wanted to give people a reason to drive by other banks just to get to their location.

4. In the video, UMPQUA’s Bank is compared to which of the following?A. a nice hotelB. a restaurant with good serviceC. a fine retailerD. All of the aboveAnswer: D.Explanation: The company strives to provide “a different kind of service” in the banking industry.

5. “A different kind of design” in the video is represented by the bank’s:A. unique financial advising.B. public relations.C. beautiful space.D. stock portfolio selection.Answer: C.Explanation: UMPQUA Bank’s goal is for people to hang out and stay awhile inside their “store.”

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Chapter 19: The Global Marketplace

Topic: Monster, a global online career advancement service, is now heavily focused on developing business in China

Learning Objectives:1. Discuss how the international trade system and the economic, political-legal, and cultural

environments affect a company’s international marketing decisions.

Video Title: MonsterLink: http://media.pearsoncmg.com/ph/bp/bp_mylabs/akamai/template/video640x480.php?title=Monster.com&clip=pandc/bp/2011/armstrong/Monster.mov&caption=bp/bp_mylabs/akamai/2011/armstrong/xml/Monster.xml

Classroom Application: As highlighted in the video, global companies are now looking to expand into China, as the market potential there is enormous. An interesting exercise would be for students to brainstorm or speculate about what American products would succeed vs. fail in local Chinese markets—it’s very likely that the products they talk about are successful in China already, so encourage students to research the presence of such products in China.

SynopsisMonster is a US-based company that now serves around 60 countries worldwide. It is an online career advancement service that connects employers with today’s talented job seekers. Its current focus is to succeed in China, which now represents the largest scale of market with the largest potential future growth. China is a collection of smaller localized markets, so Monster’s plan is to adapt its services in such a way as to conform and respect each local Chinese market’s customs and traditions.

Discussion Questions1. The chapter states that “companies that understand cultural nuances can use them to their advantage when positioning products and preparing campaigns internationally.” Explain how Monster went about attempting to understand the cultural nuances of the Chinese markets.

The video mentioned the acquisition of “China HR” to adapt their product in the Chinese market. China HR had expertise in this market, and such an acquisition allowed Monster to better understand how to integrate what they did well into the local markets’ infrastructure. Monster also added some new talent in China who understand the marketing perspective nuances at a local market level.

2. There are often local market custom surprises for a global company that affect how a product will be accepted in a foreign market. Explain the surprise Monster encountered with respect to how job seekers in local Chinese markets searched for jobs.

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The video explains that when it comes to a job search in local Chinese markets, there are retail outlets that have jobs on display in a sort of self-serve, walk-on-by way. Therefore, many Chinese job seekers are not really looking for the extensive level of career management tools that Monster provides and its US customers expect. Many Chinese job seekers still use a transactional model—they desire a job search resource that just helps them find the right job.

3. “Americanizing” foreign countries around the world is mentioned in the chapter to explain the impact of marketing strategies on global cultures. Do you think Monster will be just another American country that facilitates the “Americanization” of China? Discuss.

Students will have different opinions. The video highlights the respect Monster has treated its development into local Chinese markets, letting these markets on their own terms be successful while bringing the Monster brand to life in a consistent way. Monster recognizes that they just can’t take their US product and export it into the local Chinese markets—this would likely be interpreted by the Chinese population as culturally disrespectful. In time and with slow exposure, it is possible that the Chinese population may exhibit increasing interest in Monster’s extensive career management tools, but it is also possible that their cultural traditions and perspectives may never fully accept Monster’s services that Americans come to expect and desire.

Quiz1. Monster provides:A. online career advancement development.B. a diet and food-delivery service.C. soda.D. banking.Answer: A.Explanation: This is a simple, straightforward question designed to assess whether or not students paid attention to the video (instead of daydreaming).

2. In the video, the phrase “It’s the newspaper that anyone can read” is a reference to the early power of:A. integrated marketing communicationsB. USA TodayC. the New York TimesD. the internetAnswer: D.Explanation: The internet at the time of Monster’s early beginnings revolutionized the job placement and advancement industry.

3. Monster:A. is really just a virtual bulletin board to this day.B. only provides services for job seekers.C. works with employers to communicate their brand to job seekers.D. does not really benchmark job seekers’ abilities and interests.Answer: C.

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Explanation: Monster connects companies with today’s talent.

4. The first country that Monster expanded into was ____________, and now the company is in around 60 countries worldwide.A. CanadaB. MexicoC. EnglandD. FranceAnswer: A.Explanation: Going global was always the company’s goal, as people work everywhere.

5. The video highlights the need to _____________ if you want to be a “global player.”A. invest in cutting edge technologyB. be in ChinaC. have a strong Web site designD. invest in customer relationship managementAnswer: B.Explanation: China’s immense scale of market and potentially quick growth renders it as the most powerful potential market in the world to global companies.

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Chapter 20: Marketing Ethics and Social Responsibility

Topic: Land Rover is committed to environmentally friendly and sustainable business practices to serve the needs of its global consumers.

Learning Objectives:1. Define sustainable marketing and discuss its importance.2. Define consumerism and environmentalism and explain how they affect marketing

strategies.3. Explain the role of ethics in marketing.

Video Title: Land RoverLink: http://media.pearsoncmg.com/ph/bp/bp_akamai/kotler/Land_Rover.html

Classroom Application: “It’s easy ‘talk the talk,’ but can you ‘walk the walk?’” Such a line fits the current communications and practices of the global marketplace in relation to each company’s position on sustainable marketing. To confirm and verify the take-home messages presented by Land Rover’s executives in the video, go on the internet to track Land Rover’s efforts and actions to follow an environmentally responsible and sustainable business model. In addition to looking over their Web site, use your preferred search engine to research credible and objective news articles/blogs that cover Land Rover’s practices.

SynopsisLand Rover attributes it great success to its environmentally responsible and sustainable business model and practices. Its vehicles were originally invented as a piece of agricultural equipment that could be driven on the land, which is considered to be the essence of the company. Fittingly, Land Rover considers sustainability to be its biggest challenge it faces as a company. Not only does Land Rover make every effort to reduce its carbon dioxide emissions, waste, and water consumption, the company invests in sustainable and environmental technology projects around the world.

Discussion Questions1. Are you impressed with Land Rover’s efforts regarding environmental responsibility and sustainable business practices?

The video outlines Land Rover’s many efforts in these regards, but certainly students may still be critical and cautious about the necessity of producing 4X4 luxury SUVs!

2. Considering your response in Question #1 above, how interested do you think environmentally conscientious consumers are in buying Land Rover vehicles?

Conscientious consumers might see Land Rover’s utility in a bit more favorable light considering their sustainability efforts and environmentally responsible mission.

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3. In the video, Julian Whitehead states that businesses need to be concerned with the environment if they want to stay in business. Do you agree with this? Why or why not?

Certainly, this is the main take-home message in the chapter, but some students may be a bit cynical about this perspective. This will undoubtedly produce a very lively discussion!

Quiz1. Land Rover provides:A. motor vehicles.B. construction equipment.C. running shoes.D. helicopters.Answer: A.Explanation: This is a simple, straightforward question designed to assess whether or not students paid attention to the video (instead of daydreaming).

2. Land Rover’s vehicles were initially developed to:A. assist in construction of buildings.B. eclipse the record for speed.C. transport large amounts of people.D. assist in the working of the land.Answer: D.Explanation: Land Rover vehicles were first created over 60 years ago.

3. What is mentioned in the video as the essence of Land Rover?A. Speed, speed, and more speed!B. a luxury rideC. a piece of agricultural equipment that could be driven on the landD. flashy yet economicalAnswer: C.Explanation: This would be considered to be Land Rover’s unique value proposition.

4. According to Colin Green in the video, which of the following is the biggest challenge Land Rover faces as a company?A. traditional advertising efforts to break through the clutterB. sustainabilityC. customer relationship management (CRM)D. increasing competition saturating the marketplaceAnswer: B.Explanation: The company strives to build its product more efficiently and to explicitly communicate all its sustainability business practices to consumers.

5. Land Rover’s “climate care fund” mentioned in the video supports:

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A. sustainable technology projects around the world.B. England’s weather satellite projection efforts.C. endangered animal species in desert climates.D. tropical vacations donated to underprivileged families.Answer: A.Explanation: Together with Jaguar, Land Rover has invested 700 million pounds on environmental technology.

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