Marketing 13-18

Advertising
Paid non personal communication about an organization and its products transmitted to a target audience through mass media
Institutional advertising
Advertising that promotes organizational images, ideas, and political issues
Advocacy advertising
Advertising that promotes a company’s position on a political issue
Product Advertising
Advertising that promotes the uses, features, and benefits of products
Pioneer Advertising
Advertising that tries to stimulate demand for a product category rather than a specific brand by informing potential buyers about the product
Competitive advertising
Tries to stimulate demand for a specific brand by promoting its features, uses, and advantages relative to competing brands
Comparative Advertising
Compares the sponsored brand with one or more identified brands on the basis of one or more product characteristics
Reminder Advertising
Advertising used to remind consumers about an established brand’s uses, characteristics, and benefits
Reinforcement advertising
Advertising that assures users they chose the right brand and tells them how to get the most satisfaction from it
Advertising campaign
The creation and execution of a series of advertisements to communicate with a particular target audience
Target Audience
The group of people at whom advertisements are aimed
Advertising Platform
Basic issues or selling points to be included in an advertising campaign
Advertising Appropriation
The advertising budget for a specific time period
Objective-and-task approach
Budgeting for an advertising campaign by first determining its objectives and then calculating the cost of all the tasks needed to attain them
Percent-of-sale approach
Budgeting for an advertising campaign by multiplying the firm’s past and expected sales by a standard percentage
Competition-matching
Determining an advertising budget by trying to match competitors’ advertising outlays
Arbitrary Approach
High-level executive in the firm states how much to spend on advertising for a certain period.
Media Plan
A plan that specifies the media vehicles to be used and the schedule for running advertisements
TV
Top dollars spent on selected media are for:
Cost comparison indicator
A means of comparing the costs of advertising vehicles in a specific medium in relation to the number of people reached
Regional Issues
Versions of a magazine that differ across geographic regions
Copy
The verbal portion of advertisements
Storyboard
A blueprint that combines copy and visual material to show the sequence of major scenes in a commercial
Artwork
An advertisement’s illustrations and layout
Illustration
Photos, drawings, graphs, charts, and tables used to spark audience interest in an advertisement
Layout
The physical arrangement of an advertisement’s illustration and copy
Pretest
Evaluation of advertisements performed before a campaign begins
consumer jury
A panel of a product’s existing or potential buyers who pretest ads
Posttest
Evaluation of advertising effectiveness after the campaign
Recognition Test
A posttest in which respondents are shown the actual ad and are asked if they recognize it
Unaided Recall Test
A posttest in which respondents are asked to identify advertisements they have seen recently but are not given any recall clues
Aided Recall Test
A posttest that asks respondents to identify recent ads and provides clues to jog their memories
Public Relations
Communication efforts used to create and maintain favorable relations between an organization and its stakeholders
Publicity
A news story type of communication about an organization and/or its products transmitted through a mass medium at no charge
News Release (press release0
A short piece of copy publicizing an event or a product (usually shorter than 300 words)
Feature article
A manuscript of up to 3,000 words prepared for a specific publication
Captioned Photograph
A photograph with a brief description of its contents
Press Conference
A meeting used to announce major news events
Environmental Monitoring
Identifies change in public opinion affecting an organization
Public Relations Audit
Used to assess an organization’s image among the public or to evaluate the effect of specific public relations program
Communication Audit
May include a content analysis of messages, a readability study, or a leadership survey.
Advertising Response Function
a phenomenon in which spending for advertising and sales promotion increase sales or market share up to a certain level but then produces diminishing returns
Institutional Advertising
a form of advertising designed to enhance a company’s image rather than promote a particular product
Product Advertising
a form of advertising that touts the benefits of a specific good or service
Advocacy Advertising
a form of advertising in which an organization expresses its views on controversial issues or responds to media attacks
Pioneering Advertising
a form of advertising designed to stimulate primary demand for a new product or product category
competitive advertising
a form of advertising designed to influence demand for a specific brand
comparative advertising
a form of advertising that compares two or more specifically named or shown competing brands on one or more specific attributes
advertising campaign
a series of related advertisements focusing on a common theme, slogan, and set of advertising appeals
advertising appeal
a reason for a person to buy a product
unique selling proposition
a desirable exclusive, and believable advertising appeal selected as the theme for a campaign
medium
the channel used to convey a message to a target market
media planning
the series of decisions advertisers make regarding the selection and use of media, allowing the marketer to optimally and cost- effectively communicate the message to the target audience
cooperative advertising
an arrangement in which the manufacturer and the retailer split the costs of advertising the manufacturer’s brand
infomercial
a 30 min or longer ad that looks more like a tv talk show than a sales pitch
advergaming
placing advertising messages in Web-based, mobile, console, or handheld video games to advertise or promote a product, service, organization, or issue
media mix
the combination of media to be used for a promotional campaign
cost per contact
the cost of reaching one member of the target market
cost per click
the cost associated with a consumer clicking on a display or banner ad
reach
the number of target consumers exposed to a commercial at least once during a specific period, usually 4 weeks
frequency
the number of times an individual is exposed to a given message during a specific period
audience selectivity
the ability of an advertising medium to reach a precisely defined market
media schedule
designation of the media, the specific publications or programs, and the insertion dates of advertising
continuous media schedule
a media scheduling strategy in which advertising is run steadily throughout the advertising period; used for products in the later stages of the product life cycle
Flighted media schedule
a media scheduling strategy in which ads are run heavily every month or every two weeks to achieve a greater impact with an increased frequency and reach at those times
pulsing media schedule
a media scheduling strategy that uses continuous scheduling throughout the year coupled with a flighted schedule during the best sales period
seasonal media schedule
a media scheduling strategy that runs advertising only during times of the year when the product is most likely to be used
public relations
the element in the promotional mix that evaluates public attitudes, identifies issues that may elicit public concern, and executes programs to gain public understanding and acceptance
publicity
an effort to capture media attention, often initiated through the press releases that further a corporation’s public relations plans
product placement
a public relations strategy that involves getting a product, service, or company name to appear in a movie, television show, radio program, magazine, newspaper, video game, video or audio clip, book, or commercial for another product; on the Internet; or at special events
sponsorship
a public relations strategy in which a company spends money to support an issue, cause or event that is consistent with corporate objectives, such as improving brand awareness or enhancing corporate image
crisis management
a coordinated effort to handle all the effects of unfavorable publicity or another unexpected unfavorable event
sales promotion
marketing communication activities other than advertising, personal selling, and public relations, in which a short-term incentive motivates consumers or members of the distribution channel to purchase a good or service immediately, either by lowering the price or by adding value
trade sales promotion
promotion activities directed to members of the marketing channel, such as wholesalers and retailers
consumer sales promotion
promotion activities targeted to the ultimate consumer market
trade allowance
a price reduction offered by manufacturers to intermediaries such as wholesalers and retailers
push money
money offered to channel intermediaries to encourage them to “push” products- that is, to encourage other members of the channel to sell the products
coupon
a certificate that entitles consumers to an immediate price reduction when the product is purchased
rebate
a cash refund given for the purchase of a product during a specific period
premium
an extra item offered to the consumer, usually in exchange for some proof of purchase of the promoted product
loyalty marketing program
a promotional program designed to build long- term, mutually beneficial relationships between a company and its key customers
frequent buyer program
a loyalty program in which loyal consumers are rewarded for making multiple purchases of a particular good or service
sampling
a promotional program that allows the consumer the opportunity to try a product or service for free
point of purchase display
a promotional display set up at the retailers location to build traffic, advertise the product, or induce impulse buying
sustainable marketing
sustainable marketing
marketing concept
organizations thrive from day to day by determining the current needs and wants of target customers and fulfilling those needs and wants more effectively and efficiently than competitors do.
*focuses on meeting the company’s short-term sales, growth, and profit needs by engaging customers and giving customers what they want now*
societal marketing concept
considers the future welfare of consumers.
strategic planning concept
considers future company needs.
sustainable marketing concept
calls for socially and environmentally responsible actions that meet both the immediate and future needs of customers and the company.
Social Criticisms of Marketing
Impact on Individual Consumers
Impact on Society as a Whole
Impact on Other Businesses
Marketing’s Impact on
Individual Consumers
High prices
Deceptive practices
High-pressure selling
Shoddy, harmful, or unsafe products
Planned and perceived obsolescence
Poor service to disadvantaged consumers
high prices because of
high costs of distribution, high advertising and promotion costs, and excessive markups.
Deceptive pricing
includes practices such as falsely advertising prices from a phony high retail list price.
Deceptive promotion
practices such as misrepresenting the product’s features.
Deceptive packaging
involves exaggerating package contents in misleading terms.
Deceptive practices led to the
Wheeler-Lea Act, which gave the Federal Trade Commission (FTC) power to regulate unfair or deceptive acts or practices.
planned obsolescence
causing their products to become obsolete before they need replacement
perceived obsolescence
continually changing consumer concepts to encourage more and earlier buying.
redlining
major chain retailers of redlining, drawing a red line around disadvantaged neighborhoods and avoiding placing stores there.
Marketing’s Impact on
Society as a Whole
False Wants and Too Much Materialism
Too Few Social Goods
Cultural Pollution
too few social goods
As private goods increase, they require more public services that are usually not forthcoming. A way must be found to restore a balance between private and public goods. One option is to make producers bear the full social costs of their operations. A second option is to make consumers pay the social costs.
ex. cities now charging congestion tolls in an effort to reduce traffic congestion.
cultural pollution
marketers hope their ads primarily reach the target audience. Second, because of ads, many television, radio, online, and social media sites are free to users. Thus, to hold consumer attention, advertisers are making their ads more entertaining and informative.
Marketing’s Impact on
Other Businesses
Acquisitions of competitors

Marketing practices that create barriers to entry

Unfair competitive marketing practices

Acquisitions of competitors
concern that vigorous young competitors will be absorbed, thereby reducing competition
Marketing practices that create barriers to entry
Large marketing companies use patents and heavy promotion spending or tie up suppliers or dealers to keep out competitors.
Those concerned with antitrust regulation recognize that some barriers are the natural result of the economic advantages of doing business on a large scale. Existing and new laws can challenge other barriers.
Unfair competitive marketing practices
set their prices below costs, threaten to cut off business with suppliers, discourage the buying of a competitor’s products, or use their size and market dominance to unfairly damage rivals
Consumerism
organized movement of citizens and government agencies designed to improve the rights and power of buyers in relation to sellers.
traditional Seller’s rights
To introduce any product in any size and style with proper warnings and controls, if necessary

To charge any price for the product without any discrimination

To spend any amount to promote the product if competing fairly

To use any product message that is not misleading or dishonest

To use buying incentive programs that are not unfair or misleading

traditional buyers rights
To buy a product that is offered for sale

To expect the product to be safe

To expect the product to perform as claimed

Proposed Consumer Rights
many believe that the balance of power lies on the seller’s side. Critics feel the buyer has *too little information, education, and protection* to make wise decisions when facing sophisticated sellers.
Consumer advocates call for the following additional consumer rights:
To be well informed

To be protected against questionable products and marketing practices

To influence products and marketing practices to improve “quality of life”

To consume in a way to preserve the world for future generations of consumers

Environmentalism
organized movement of concerned citizens, businesses, and government agencies designed to protect and improve people’s current and future living environment.
environmentalism concerns
Damage to the ecosystem
Loss of recreational areas
Increase in health problems
environmental sustainability
management approach that involves developing strategies that both sustain the environment and produce profits for the company.
environmental sustainability and sustainable value
environmental sustainability and sustainable value
Marketing Decision Areas That May Be Called into Question under the Law- selling decisions
Bribing
Stealing trade secrets
Disparaging customers
Misrepresenting
Disclosure of customer rights
Unfair discrimination
advertising decisions- legal issues
False advertising
Deceptive advertising
Bait-and-switch advertising
Promotional allowances and services
Channel decisions- legal issues
Exclusive dealing
Exclusive territorial distributorship
Tying agreements
Dealer’s rights
Competitive relations decisions: legal issues
Anticompetitive acquisition
Barriers to entry
Predatory competition
product decision: legal issues
Product additions and deletions
Patent protection
Product quality and safety
Product warranty
Packaging decisions: legal issues
Fair packaging and labeling
Excessive cost
Scarce resources
Pollution
Price decisions: legal issues
Price fixing
Predatory pricing
Price discrimination
Minimum pricing
Price increases
Deceptive pricing
Consumer-oriented marketing
organize marketing activities from consumer’s point of view.

It should work hard to sense, serve, and satisfy the needs of a defined group of customers, both now and in the future.

customer value marketing
the company should put most of its resources into customer value-building marketing investments.
By creating value for consumers, the company can capture value from consumers in return.
innovative marketing
requires that the company continuously seek real product and marketing improvements.
Sense-of-mission marketing
company should define its mission in broad social terms rather than narrow product terms. Brands linked with broader missions can serve the best long-run interests of both the brand and consumers.
societal marketing
marketing decisions by considering consumers’ wants, the company’s requirements, consumers’ long-run interests, and society’s long-run interests.
societal classifications of products
societal classifications of products
Deficient products
such as bad-tasting and ineffective medicine, have neither immediate appeal nor long-run benefits.
Pleasing products
give high immediate satisfaction but may hurt consumers in the long run. Examples include cigarettes and junk food.
Salutary products
have low immediate appeal but may benefit consumers in the long run. Bicycle helmets or some insurance products are examples.
Desirable products
give both high immediate satisfaction and high long-run benefits, such as a tasty and nutritious breakfast food.
Marketing Ethics
Corporate marketing ethics policies should be developed by firms as guidelines for handling various issues and dilemmas.
issues with ethics in marketing
Distributor relations
Advertising standards
Customer service
Pricing
Product development
General ethical standards
marketing ethics role
Principles are needed to guide companies and marketing managers on issues of ethics and social responsibility.

-free market and the legal system should decide such issues.
-Responsibility is in the hands of individual companies and managers.

addressing ethics helps
build strong customer relationships based on honesty and trust.
Ethical Norms Suggested by the
American Marketing Association
Do no harm
Foster trust in the marketing system
Embrace ethical values
do no harm
consciously avoiding harmful actions or omissions by embodying high ethical standards and adhering to all applicable laws and regulations in the choices we make.
foster trust in the marketing system
striving for good faith and fair dealing so as to contribute toward the efficacy of the exchange process, and avoiding deception in product design, pricing, communication, and delivery or distribution
embrace ethical values
building relationships and enhancing consumer confidence in the integrity of marketing by affirming core values such as, honesty, responsibility, fairness, respect, transparency, and citizenship.
sustainable companies
create value for customers through socially, environmentally, and ethically responsible actions.
sustainable marketing provides
the context in which companies can build profitable customer relationships.
Unlike the marketing​ concept, the sustainable marketing concept focuses on​ ____
the future best interests of customers and the business
The five guiding principles of sustainable marketing are​ ________.
consumer-oriented marketing, customer value​ marketing, innovative​ marketing, sense-of-mission​ marketing, and societal marketing
________ is an organized movement of concerned​ citizens, businesses, and government agencies designed to protect and improve​ people’s current and future living environment.
environmentalism
Because of the lack of supermarkets in​ low-income areas, many disadvantaged consumers find themselves in​ ________, with little or no access to​ healthy, affordable fresh foods.
food deserts
Which of the following considers the future needs of a​ company?
strategic planning concept
​________ refers to consciously avoiding harmful actions or omissions by embodying high ethical standards and adhering to all applicable laws and regulations in the choices we make.
do no harm
____ means building relationships and enhancing consumer confidence in the integrity of marketing by affirming these core​ values: honesty,​ responsibility, fairness,​ respect, transparency, and citizenship.
embrace ethical values
WSJ: Walmart Sued for Adding ‘Wood Pulp Product’ to its Parmesan
he was induced to purchase Great Value’s “100% Grated Parmesan Cheese” at a premium price because he believed it was, indeed, 100 percent cheese. But it contains 7 to 10 percent cellulose — a filler and anti-clumping agent derived from wood chips — according to a complaint filed last week, which accuses the retail brand of deceptive business practices.
WSJ: Social-Media Companies Forced to Confront Misinformation and Harassment
twitter-said it would let users block notifications of tweets that include specific words, among other moves, in an effort to combat harassment

facebook:it would bar websites that post fabricated or misleading news articles from using its ad-selling tools.

“What he needs to do is hire more humans instead of pushing (the responsibility) onto the end user,

find a balance between being havens for misinformation and censors of free speech.

WSJ: Adidas Moves to Address Environmental Worries
develop soccer cleats that can be repeatedly recycled, use no chemical adhesives and create no waste, amid growing concerns that the world’s rise in garment consumption is hurting the environment.

“leading example” in tackling climate change, by agreeing to measure its climate footprint and reduce emissions where possible

“Green washer”—a company that cynically uses green marketing to appear more environmental than it is. Greenpeace said “the ambition level and the transparency Nike demonstrated to consumers is questionable.”

Global Firm
Operates in more than one country
Gains research and development, production, marketing, and financial advantages that are not available to purely domestic competitors
global firm problems faced
Highly unstable governments and currencies
Restrictive government policies and regulations
High trade barriers and corruption
international marketing decisions
1. Looking at the Global Marketing Environment
2. Deciding Whether to Go Global
3. Deciding Which Markets to Enter
4. Deciding How to Enter the Market
5. Deciding on the Global Marketing Program
6. Deciding on the Global Marketing Organization
Looking at the Global
Marketing Environment
International trade system
Economic environment
Political-legal environment
Cultural environment
International Trade System
Trade barriers
Tariffs or duties (taxes)
Quotas and exchange controls
Nontariff trade barriers:
-Biases against the bids
-Restrictive product standards
-Excessive host-country regulations or enforcement
World Trade Organization (WTO)
Established by the General Agreement on Tariffs and Trade (GATT) in 1995
Promotes world trade by reducing tariffs and other international trade barriers
Negotiates to reassess trade barriers and establish new rules for international trade
Imposes international trade sanctions and mediates global trade disputes
Economic community
Group of nations organized to work toward common goals in the regulation of international trade
European Union (EU)
community that was formed in 1957. It was set out to create a single European market by reducing barriers to the free flow of products, services, finances, and labor among member countries and developing policies on trade with nonmember nations. Today, the EU represents one of the world’s largest single markets.
North American Free Trade Agreement (NAFTA)
founded in 1994, established a free trade zone among the United States, Mexico, and Canada.
Central American Free Trade Agreement (CAFTA-DR)
2005, established a free trade zone between the United States and Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras, and Nicaragua.
Other free trade areas have formed in Latin America and South America.
Union of South American Nations (UNASUR)
modeled after the EU, was formed in 2004 and formalized by a constitutional treaty in 2008. UNASUR makes up the largest trading bloc after NAFTA and the EU. Similar to NAFTA and the EU, UNASUR aims to eliminate all tariffs between nations by 2019.
Factors reflecting a country’s market attractiveness:
Industrial structure:
Subsistence economies
Raw material exporting economies
Emerging economies
Industrial economies
Income distribution:
Low-, medium-, and high-income households depending on the industrial structure of the nation
subsistence economies
vast majority of people engage in simple agriculture. They consume most of their output and barter the rest for simple goods and services. These economies offer few market opportunities
raw material exporting economies
rich in one or more natural resources but poor in other ways. Much of their revenue comes from exporting these resources.
emerging economies
fast growth in manufacturing results in rapid overall economic growth. As manufacturing increases, the country needs more imports of raw materials and fewer imports of finished products
Industrial economies
major exporters of manufactured goods, services, and investment funds. They trade goods among themselves and export them to other types of economies for raw materials and semifinished goods.
income distribution
Industrialized nations may have low-, medium-, and high-income households. Countries with subsistence economies consist mostly of households with very low family incomes. Still other countries may have households with either very low or very high incomes.
Considerations for a company to do business in a country:
Country’s attitude toward international buying
Government bureaucracy
Political stability
Monetary regulations
International trade involves
Cash transactions
Bartering

many nations have too little hard currency to pay for their purchases from other countries. They may want to pay with other items instead of cash. Barter involves the direct exchange of goods or services.

Impact of Culture
on Marketing Strategy
Companies that understand cultural nuances can

-Avoid expensive and embarrassing mistakes
-Take advantage of cross-cultural opportunities

Factors influencing the decision to go global
Attacks on a company’s home market by global competitors

Expanding customer base in international markets

Better opportunities for growth

A company should
Define its international marketing objectives and policies
Decide what volume of foreign sales it wants
Choose in how many countries it wants to market
Determine the types of countries to enter
Evaluate each market
Market Entry Strategies international
exporting
joint venturing
direct investment
Indirect exporting
less investment because the firm does not require an overseas marketing organization or network.

company enters a foreign market by sending and selling products through international marketing intermediaries

direct exporting
they handle their own exports. Investment and risk are greater in this strategy, but so is the potential return.
company’s own department, branch, or sales representatives or agents
Joint venturing
entering foreign markets by joining with foreign companies to produce or market a product or service. There are four types of joint ventures.
Licensing
involves entering foreign markets by developing an agreement with a licensee in the foreign market.
offering the right to use a manufacturing process, trademark, patent, trade secret, or other item of value for a fee or royalty.
Contract manufacturing
when a company contracts with manufacturers in a foreign market to produce its product or provide its service.
management contracting
domestic firm supplies know-how to a foreign company that supplies the capital.
joint ownership
cooperative venture in which a company creates a local business with investors in a foreign market, who share ownership and control.
Direct investment
entering a foreign market by developing foreign-based assembly or manufacturing facilities. If a company has gained experience in exporting and if the foreign market is large enough, foreign production facilities offer many advantages. However, the firm faces many risks, such as restricted or devalued currencies, falling markets, or government changes.
Standardized global marketing
Using the same marketing strategy and mix in all of the company’s international markets
adapted global marketing
Adjusting the marketing strategy and mix elements to each international target market
Creates more costs
Produces a larger market share and return
global product and communications strategies
global product and communications strategies
Straight product extension
marketing a product in a foreign market without making any changes to the product.
Product adaptation
involves adapting a product to meet local conditions or wants in foreign markets.
Communication adaptation
fully adapting advertising messages to local markets. Media also need to be adapted internationally because media availability and regulations vary from country to country.
product invention
creating something new to meet the needs of consumers in a given country.
Global Price Considerations
Set a uniform price globally

Set according to the customers

Use a standard markup of the company’s costs everywhere

many companies make simpler or smaller versions of their products that can be sold at lower prices. Others introduce new, more affordable brands in global markets.

whole channel concept
whole channel concept
whole-channel view
designing international channels that take into account the entire global supply chain and marketing channel, forging an effective global value delivery network.
channels between nations
moves company products from points of production to the borders of countries within which they are sold.
channels within nations
moves products from their market entry points to the final user or buyer.
Methods of managing international marketing activities:
Organizing an export department
Creating international divisions
-Geographical organizations
-World product groups
-International subsidiaries
Becoming a global organization
export department
A firm gets into international marketing by simply shipping out its goods. If its international sales expand, the company will establish an export department with a sales manager and a few assistants.
international divisions
or subsidiaries to handle all its international activity. International divisions are organized in a variety of ways.
geographical organizations or international divisions
with country managers who are responsible for salespeople, sales branches, distributors, and licensees in their respective countries.
world product groups,
each responsible for worldwide sales of different product groups.
international subsidiaries
each responsible for their own sales and profits.
global organizations
As foreign companies successfully invade their domestic markets, companies must move more aggressively into foreign markets.
What are the two economic factors that reflect the​ country’s attractiveness as a​ market?
Industrial structure and income distribution
Your answer is correct.
Which of the following are the three ways an international​ division’s operating units can be​ organized?
Geographical​ organizations, world product​ groups, or international subsidiaries
_______ involve(s) the direct exchange of goods and services.
barter
The purpose of a tariff is to​ ________.
raise revenue
In​ a(n) __________economy, fast growth in manufacturing results in rapid overall economic growth.
emerging
________ economies are major exporters of manufactured​ goods, services, and investment funds.
industrial
Twenty-Four7, a cosmetic firm located in the United​ States, markets its products in Asian and European countries through independent distributors. In this​ case, Twenty-Four7 has entered international markets through​ ________.
indirect exporting
University Boutiques promotes its brand in new international markets by providing rights to local boutiques to use its patented designs and brand name. In this​ case, University​ Boutiques’ market-entering strategy is referred to as​ ________.
licensing
The biggest involvement in a foreign market comes through​ ________ of the development of​ foreign-based assembly or manufacturing facilities.
direct investment
______ is when a company adds the cost of​ transportation, tariffs, importer​ margin, wholesaler​ margin, and retailer margin to its factory price.
price escalation
_____ is a global communication strategy of fully adapting advertising messages to local markets.
communication adaptation
Many companies get involved in several international markets and ventures. They can be​ __________, with country managers who are responsible for​ salespeople, sales​ branches, distributors, and licensees in their respective countries.
geographical
WSJ:Apple’s Tax Avoidance Illustrates Gap Between Law and Economics
It alleges Ireland cut Apple a special deal that amounts to illegal government aid to a private company.
Multinational tax avoidance is growing precisely because aggressive companies can find so many ways, and so many government partners, to avoid paying taxes.
the growth of intellectual property such as patents, brands and software as a source of profit, which is easily shifted between foreign jurisdictions.
sophistication and boldness with which multinationals exploit gaps between, and loopholes in, different countries’ tax systems.
government tax collectors may never catch up with the sophistication of corporate tax avoiders.
WSJ: Fast-Food Franchises Get Creative When They Go Abroad
how to tweak traditional favorites for local palates has become a crucial part of the franchise industry.
how to tweak traditional favorites for local palates has become a crucial part of the franchise industry.
The local adaptations extend beyond core menu items to areas like condiment selections.
Video: McDonalds Global Strategy
mcdonalds practices local specialization to cater to its local markets
french people want to take their time to eat and hate fast food: mcdonalds made fancy sit down restaurants, french potatoes and french cheeses
hindus: culture doesn’t eat beef, they changed the whole menu
changes games of items to fit local culture culinary styles
arches more recognizable than the cross
feed 68 million ppl a day
Video: globalization starbucks
marketing expresso coffee drinks to north america by one guys idea
he remarked the shop from seattle
brand identity with logo
turned enjoying coffee into a fashionable lifestyle all over worlds
ordinary coffee vs the starbucks experience
maintains the welcoming, trending, relaxation environment
Video: Uber’s decision to throw in the towel in China holds lessons for Facebook, Apple and others still craving success in the world’s biggest technology market.
deal in which the local champion acquires Uber’s China operations in return for a seat on Didi’s board and a slice of the Chinese company.

it went up against a nimble competitor backed by deep-pocketed internet standard-bearers

“All the kowtowing and meeting the leadership maybe won’t matter so much if Facebook won’t agree to allow some level of censorship, or allow the Chinese government access to data on the site, in exchange for market access,”

Direct and Digital Marketing
Engage directly with targeted individual consumers and customer communities to obtain an immediate response

Build lasting customer relationships, engagement, brand community, and sales

New Direct Marketing Model
Most companies still use direct marketing as a supplementary channel or medium.

For many companies today, direct and digital marketing constitute a complete model for doing business.

Rapid Growth of Direct and
Digital Marketing
Fastest-growing form of marketing
Direct marketing becoming more Internet-based
Direct marketing claims a surging share of marketing spending and sales
Includes online display and search advertising, video, social media, mobile, email
Benefits of Direct and
Digital Marketing to Buyers
Convenient, easy, and private

Easy buyer-seller interaction

Quick access to products and
relevant information

Brand engagement and community

benefits of direct and digital marketing to sellers
Low-cost, efficient, and speedy
Build close, personalized, interactive, one-to-one customer relationships
Greater flexibility
forms of direct and digital marketing
forms of direct and digital marketing
Digital and social media marketing
Using digital marketing tools to engage consumers anywhere, anytime via their digital devices
Digital age
Changing customers’ notions of convenience, speed, price, product information, service, and brand interactions

it has given marketers a whole new way to create customer value, engage customers, and build customer relationships. Some companies operate only online. They include a wide array of firms, from e-tailers to search engines and portals, transaction sites, content sites, and online social media.

Omni-channel retailing
Creating a seamless cross-channel buying experience that integrates in-store, online, and mobile shopping.
Online Marketing
Marketing via the Internet using company Web sites, online ads and promotions, email, online video, and blogs
marketing web sites
Engage consumers to move them closer to a direct purchase or other marketing outcome
branded community web sites
Present brand content that engages consumers and creates customer-brand community
Online advertising
Appears while consumers are browsing online

online advertising is search-related ads or contextual advertising. In this form of advertising, text-based ads and links appear alongside search engine results on sites such as Google, Yahoo!, and Bing.

email marketing
sending highly targeted, highly personalized, relationship-building marketing messages via email. When used properly, email can be the ultimate direct marketing medium.
spam in email marketing
unsolicited, unwanted commercial email messages that clog up our email boxes. Spam has produced consumer irritation and frustration. To address these concerns, most legitimate marketers now practice permission-based email marketing, sending email pitches only to customers who opt in.
Online Videos
Posting digital video content on brand Web sites or social media
viral marketing
Videos, ads, and other marketing content that customers seek out or pass along to friends

digital version of word-of-mouth

Blogs and Other Online Forums
Online journals of narrowly defined topics where people and companies post their thoughts and other content
benefits of blogs and forums
A fresh, original, personal, and inexpensive way to enter into consumer online conversations
limitations of blogs and forums
Cluttered, difficult to control and largely a consumer-controlled medium
Social media
Independent and commercial online communities where people congregate, to socialize and share messages, opinions, pictures, videos, and other content
two ways marketings engage in social media
Using the existing ones-easiest
Setting up their own- ex nike running community
Niche social media
cater to the needs of smaller communities of like-minded people, making them ideal vehicles for marketers who want to target special interest groups.
Advantages social media
Targeted and personal
Interactive
Immediate and timely
Cost effective
Engagement and social sharing capabilities
challenges social media
Effective usage uncertain
Difficult to measure results
Largely user controlled
Integrated Social Media Marketing
Large companies design social media efforts that blend with and support other elements of a brand’s marketing strategy and tactics.

Firms that use social media effectively create brand-related social sharing, engagement, and customer community.

Mobile Marketing
features marketing messages, promotions, and other content delivered to on-the-go consumers through their mobile devices.

to engage customers anywhere, anytime during the buying and relationship-building processes.

Retailers can use mobile marketing to enrich the customer’s shopping experience at the same time they stimulate buying.

Engages customers anywhere, anytime during the buying and relationship-building processes

Direct-Mail Marketing
Sending an offer, announcement, reminder, or other item directly to a person at a particular address
direct mail offers
Tangible and creates emotional connection with customers
Effective component of a broader integrated marketing campaign
Direct and personalized
Sent to consumers who want to receive it
Catalog Marketing
Print, video, or digital catalogs that are mailed to select customers, made available in stores, or presented online
benefits of catalog marketing
Eliminates printing and mailing costs
No space constraints
Broader assortment of presentation formats
Real-time merchandising capabilities
Prices can be adjusted instantly
Telemarketing
Selling directly to customers using the telephone
Outbound and inbound telephone marketing
Rise of do-not-call legislation resulted in opt-in calling systems
Direct-response television (DRTV) marketing
Direct-response television advertising-DRTV ads are often associated with somewhat loud or questionable pitches for cleaners, stain removers, kitchen gadgets, and nifty ways to stay in shape without working very hard at it.
Interactive TV (iTV) advertising
Interactive TV (iTV) advertising
form of direct-response television marketing
lets viewers interact with television programming and advertising.
lines continue to blur between TV screens and other video screens, interactive ads and infomercials are appearing not just on TV, but also on mobile, online, and social media platforms, adding even more TV-like interactive direct marketing venues.
Kiosk Marketing
Product or service information and ordering machines placed by companies
Smart kiosks
Wireless-enabled
Facial recognition
Some machines even use facial recognition software that lets them guess gender and age and make product recommendations based on that data.
Public Policy Issues in Direct and Digital Marketing
Irritation, Unfairness, Deception, and Fraud

Consumer Privacy

A Need for Action

Irritation
Loud, long, and insistent TV commercials
Junk mail and spam
Unfairness
Taking unfair advantage of impulsive buyers
Deception and fraud
Investment scams or phony collections for charity
Internet fraud
Phishing
Online and digital security
Access by vulnerable or unauthorized groups
Internet fraud is phishing
type of identity theft that uses deceptive emails and fraudulent online sites to fool users into divulging their personal data.
online and digital security
fear that unscrupulous snoopers will eavesdrop on their online transactions and social media postings, picking up personal information or intercepting credit and debit card numbers.
access by vulnerable or unauthorized groups
For example, marketers of adult-oriented materials and sites have found it difficult to restrict access by minors.
Consumer Privacy
Fear of invasion of privacy
Ready availability of information leaves consumers open to abuse
A Need for Action- government investigations
Do-not-call, do-not-mail, do-not-track lists
‘Can Spam’ legislation
Congressional legislation – Give more control to consumers over how online information is used
Federal Trade Commission (FTC) – Policing online privacy
marketers actions
Self-regulatory principles
Advertising option icon
Privacy rights of children
Self-regulatory principles
call for online marketers to provide transparency and choice to consumers if Web viewing data is collected or used for targeting interest-based advertising.
advertising option icon
little “i” inside a triangle, that is added to most behaviorally targeted online ads to tell consumers why they are seeing a particular ad and allowing them to opt out.
privacy rights of children
In 2000, Congress passed the Children’s Online Privacy Protection Act (COPPA), which requires online operators targeting children to post privacy policies on their sites. They must also notify and obtain parental consent before collecting personal information from children under age 13.
Companies’ actions
Own security measures
Industry-wide measures
What are the three major forms of digital direct​ marketing?
Online​ marketing, social media​ marketing, and mobile marketing
Traditional direct marketing tools include​ ________.
face-to-face selling,​ direct-mail marketing, catalog​ marketing, telemarketing,​ direct-response television​ marketing, and kiosk marketing
Which of the following statements is true regarding traditional direct marketing​ forms?
Marketers use both outbound telemarketing and inbound telemarketing.
According to the​ text, what is perhaps the toughest public policy issue now confronting the direct marketing​ industry?
invasion of privacy
Which of the following statements is true regarding sellers and their use of direct and digital​ marketing?
Sellers have opportunities to engage in​ real-time marketing.
​Geico’s website is designed to quickly turn an inquiry into a sale. Geico has designed​ a(n) ______ website.
marketing
How does Google earn approximately​ 90% of its​ revenues?
selling contextual advertising
WSJ: How PG&E’s CIO Sped Up Mobile App Deployment
mobile app boosting employee productivity to increasing safety.
lowering costs, increasing innovation and accelerating the time it takes for software developers to provision a platform needed to build mobile apps
GPS-based asset inspection app allows field workers to locate a gas or electric asset, such as a power line or service pole in a neighborhood or in a rural mountain range.
allows employees to submit information about security concerns, such as safety hazards in substations.

“It’s an opportunity for employees to speak up and share any issues and concerns they have, really reinforcing safety and innovation and continuous improvement,”

Forbes: The State Of Digital Advertising: The Google, Facebook Duopoly Tightens Its Grip
behavioral shift: consumers to turn to their mobile devices to look up everything from the details of a product to directions. Mobile is surpassing desktop as the choice to access the Internet.
Google dominates search, Facebook rules display:growth in both usage and time spent, which continues to draw advertisers in greater numbers.
Video, both live and recorded, is a key driver of growing user engagement and advertiser enthusiasm
Video: Inside an Amazon warehouse on Cyber Monday
629 items sold per second
kiva robots to handle orders, they carry the entire shelf to an amazon ‘picker’ that saves tons of time
Video: Protecting your privacy:: What you need to about Amazon’s Alexa and other devices
Personal Selling
involves personal presentations by the firm’s sales force for the purpose *of engaging customers, making sales, and building customer relationships.*
salesperson
A salesperson is an individual who represents a company to customers by performing one or more activities: prospecting, communicating, selling, servicing, information gathering, and relationship building.
The Role of the Sales Force
Links the company with its customers
Coordinates marketing and sales
sales force management
sales force management
analyzing, planning, implementing, and controlling sales force activities
territorial sales force structure
sales force organization that assigns each salesperson to an exclusive geographic territory in which that salesperson sells the company’s full line
product sales force structure
salespeople specialize in selling only a portion of the company’s products or lines
customer (or market) sales force structure
refers to a sales force organization in which salespeople specialize in selling only to certain customers or industries.
Salespeople can be specialized by
Customer and territory
Product and territory
Product and customer
Territory, product, and customer
Sales Force Size
May range from only a few to thousands
companies setting sales force size
Companies may use the workload approach to set sales force size.
Accounts grouped into classes based on size, status, or the amount of effort required to maintain the account
Number of salespeople needed to call on each class of accounts is then determined
Outside sales force (field sales force)
Travels to call on customers in the field
Inside sales force
Conducts business from their offices via telephone, the Internet, or visits from prospective buyers
-Technical sales support people
-Sales assistants
-Telemarketers and online sellers
team selling
Teams of people from different departments used to service large, complex accounts
Recruiting & Selecting Salespeople
A company should analyze the sales job and the characteristics of its most successful salespeople.
Sources for the recruitment of salespeople:
Referrals from current salespeople
Employment agencies
Internet and online social media
Posting ads and notices
College placement services
Salespeople at other companies
Training Salespeople- goals
About different types of customers
How to sell effectively
About the company’s objectives, organization, products, and the strategies of competitors
online training
Online training builds sales skills using videos, Internet-based exercises, or simulations.
Virtual instructor-led training (VILT) (a small group of salespeople at remote locations logs on to a Web conferencing site, where a sales instructor leads training sessions using online video, audio, and interactive learning tools. ) cuts travel costs, less time
Compensating Salespeople
Fixed amount – salary
Variable amount – commissions or bonuses (rewards the salesperson for greater effort and success. Compensation should direct salespeople toward activities that are consistent with the overall sales force and marketing objectives.)
Supervising Salespeople
Help salespeople work smart by doing the right things in the right ways
Tools of supervision:
call plan
One tool is the weekly, monthly, or annual call plan that shows which customers and prospects to call on and which activities to carry out.
Tools of supervision:
time-and-duty analysis
In addition to time spent selling, the salesperson spends time traveling, waiting, taking breaks, and doing administrative chores.
Tools of supervision:
Sales force automation system
computerized, digitized sales force operations that let salespeople work more effectively anytime, anywhere. Companies now routinely equip their salespeople with laptops or tablets, smartphones, wireless connections, videoconferencing technologies, and customer-contact and relationship management software. The result is better time management, improved customer service, lower sales costs, and higher sales performance.
how sales people spend time
active selling time accounts for only 37 percent of total working time.
Motivating Salespeople
Encourage salespeople to work hard and energetically toward sales force goals
Management can boost sales force morale and performance through its:
organizational climate
describes the feeling that salespeople have about their opportunities, value, and rewards for good performance.
Management can boost sales force morale and performance through its:
sales quotas
a standard that states the amount a salesperson should sell and how sales should be divided among the company’s products.

Compensation is often related to how well salespeople meet their quotas.

Management can boost sales force morale and performance through its:
positive incentives
Sales meetings provide social occasions, breaks from the routine, chances to meet and talk with company brass, and opportunities to air feelings and identify with a larger group. Companies also sponsor sales contests to spur the sales force to make a selling effort above and beyond what is normally expected.
Management gets information about its salespeople from
From sales, call, and expense reports
By monitoring the sales and profit performance data in the salesperson’s territory
Through personal observation, customer surveys, and talks with other salespeople
Evaluating Salespeople and
Sales Force Performance
Formal evaluations force management to develop standards for judging performance.
Provide salespeople with powerful tools for
Identifying and learning about prospects
Engaging customers
Creating customer value
Closing sales
Nurturing customer relationships
Major steps in sales force management:
designing
designing a sales force, management must decide what type of sales force structure will work best, sales force size, who will be involved in selling, and how various salespeople and sales-support people will work together.
recruiting
salespeople, a company may look to the job duties and the characteristics of its most successful salespeople to suggest the traits it wants in new salespeople.
selection
After the selection process is complete, *training* programs familiarize new salespeople not only with the art of selling but also with the company’s history, its products and policies, and the characteristics of its customers and competitors.
compensation
system helps to reward, motivate, and direct salespeople
supervision
and many need continuous encouragement because they must make many decisions and face many frustrations.
evaluate
Periodically, the company must evaluate their performance to help them do a better job.
social selling
fastest-growing sales trend
online, mobile, and social media technologies are helping to make sales forces more efficient, cost-effective, and productive.
steps in selling process
steps in selling process
prospecting and qualifying
qualifying—identifying qualified potential customers. They want to call on those who are most likely to appreciate and respond to the company’s value proposition—those the company can serve well and profitably.
Preapproach
refers to a salesperson learning as much as possible about a prospective customer before making a sales call. During the approach step, the salesperson should know how to meet and greet the buyer and get the relationship off to a good start.
presentation and demonstration
salesperson tells the “value story” to the buyer, demonstrating how the company’s offer solves the customer’s problems.
handling objections
the salesperson should use a positive approach, seek out hidden objections, ask the buyer to clarify any objections, take objections as opportunities to provide more information, and turn the objections into reasons for buying.
Closing
refers to a salesperson asking the customer for an order.
follow-up
refers to a salesperson following up after the sale to ensure customer satisfaction and repeat business.
Value selling
demonstrating and delivering superior customer value capturing a return on that value that is fair for both the customer and the company
Value selling requires:
Listening to customers
Understanding customers’ needs
Coordinating the company’s efforts to create lasting relationships based on customer value
salespeople too often take the easy way out by cutting prices rather than selling value.
Sales Promotion
short-term incentives to encourage the purchase or sale of a product or service. Whereas advertising offers reasons to buy a product or service, sales promotion offers reasons to buy now.
Sales promotion targets
Final buyers – Consumer promotions
Retailers and wholesalers – Trade promotions
Business customers – Business promotions
Members of the sales force – Sales force promotions
factors have contributed to the rapid growth of sales promotion.
Product managers view promotion as an effective short-run sales tool.
Competitors use sales promotion to differentiate their offers.
Advertising efficiency has declined.
Sales promotions help attract today’s more thrift-oriented consumers.
Consumer promotions
To urge short-term customer buying or boost customer-brand engagement
Trade promotions
To get retailers to carry new items and more inventory, buy ahead, or promote the company’s products and give them more shelf space
Business promotions
to generate business leads, stimulate purchases, reward customers, and motivate salespeople.
tools: Samples
Offers of a trial amount of a product
Most effective and expensive
Coupons
Certificates that save buyers money when they purchase specified products
Rebates (cash refunds)
Price reduction occurs after the purchase
Customer sends proof of purchase to the manufacturer, which then refunds part of the purchase price by mail
Price packs
also called cents-off deals, offer consumers savings off the regular price of a product. The producer marks the reduced prices directly on the label or package.
Premiums
are goods offered either free or at low cost as an incentive to buy a product.
consumer promotion tools: advertising specialties
Useful articles imprinted with an advertiser’s name, logo, or message that are given as gifts to consumers
Point-of-purchase (POP) promotions
Displays and demonstrations that take place at the point of sale
Contests, sweepstakes, and games
Give consumers the chance to win something
ex trips
Event marketing
(or event sponsorships)
Creating a brand-marketing event or serving as a sole or participating sponsor of events created by others
Trade Promotions
Used to persuade resellers to carry a brand, give it shelf space, and promote it in ads
trade promotion tools :
contests, premiums, and displays
discount
straight discount off the list price on each case purchased during a stated period of time (also called a price-off, off-invoice, or off-list).
allowance
(so much off per case) in return for the retailer’s agreement to feature the manufacturer’s products in some way.
free goods
extra cases of merchandise, to resellers who buy a certain quantity or who feature a certain flavor or size.
push money
cash or gifts to dealers or their sales forces to “push” the manufacturer’s goods.
specialty advertising items
that carry the company’s name, such as pens, calendars, memo pads, flashlights, and tote bags.
Business Promotions
Used to generate business leads, stimulate purchases, reward customers, and motivate salespeople
business promotion tools: conventions and trade shows
Firms selling to the industry exhibit their products at the trade show. Vendors at these shows receive many benefits, such as opportunities to find new sales leads, contact customers, introduce new products, meet new customers, sell more to present customers, and educate customers with publications and audiovisual materials.
sales contest
for salespeople or dealers to motivate them to increase their sales performance over a given period. Sales contests motivate and recognize good company performers, who may receive trips, cash prizes, or other gifts.
Sales promotion program design decisions:
-Determine the size of the incentive
-Set conditions for participation
-Determine how to promote and distribute the promotion program
-Set the length of the promotion
-Evaluate the promotion
What are the four sales force structures a company can​ use?
​Territorial, product,​ customer, and complex
Closing a sale with a particular customer is a​ short-term ________​ orientation, but the selling process must also take a​ ________ orientation and look at the long term.
​transactional; relationship
Promotional tools offered to consumers include​ ________
​rebates, coupons, price​ packs, and samples
GE Healthcare employs different sales forces for diagnostic​ imaging, life​ sciences, and integrated IT products and services. GE Healthcare has adopted​ a(n) ______ sales force structure.
product
What are the four elements of a compensation plan for​ salespeople?
A fixed​ amount, a variable​ amount, expenses, and fringe benefits
Helping salespeople to​ “work smart” by doing the right things in the right ways is the goal of which area of sales force​ management?
supervision
To set its sales force​ size, a company can first group accounts into different classes according to​ size, account​ status, or other factors related to the amount of effort required to maintain the account. It then determines the number of salespeople needed to call on each class of accounts the desired number of times. This is called the​ ______ approach.
workload
Which of the following are common trade promotion​ tools?
​Discounts, free​ goods, allowances and free advertising specialty items
Which of the following statements about sales promotions is​ correct?
The growing use of sales promotion has resulted in promotion clutter.
CES: Annual Tech Event Draws Other Industries
CES also serves as a showcase for the suppliers providing technology to the auto makers.

Illustrating how ubiquitous technology has become, some top-billed speakers will come from other industries.

Squeezed by Rival Unlimited Plans, Sprint to End 50% Discount
Sprint has said the 50% offer got people in the door, at which point the carrier would upsell them to a plan that cost the same as AT&T or Verizon but that came with double the data.
But when rivals offer unlimited, there is nothing really left to upset

turn its focus away from aggressively adding subscribers and more toward profitability.

Video: red bull
life style moment advertising
red bull the future
product placement
the only limit is the one you set yourself, if you believe in it anything is possible
Video: ‘Taste the Feeling’ Media Event
tokyo to launch new campaign, launch of a new business approach
one brand idea
positioning coke as a simple pleasure and in everyday simple moments in peoples life
hence ‘taste the feeling’
drink any of the coke beverages
taste the feeling song created
classic and timeless brand to celebrate whats great about coke, the special moments,
from drinking the worlds favorite soft drink