EXAM SUMMARY: LECTURES 1 - 10
Lecture 1 - Introduction
- What is Marketing? How do people in business often think about marketing?
- A Love of Tactics: Marketing 4P’s
o Marketing as tactics
Sales promotions and coupons
Advertising, logos, brochures…
o Marketing as cost (vs. investment)
The accountability problem (hard to monitor the returns and justify)
The accounting problem (marketing cannot generate anything:
necessary cost)
o Surrendered decisions to other dept.
Pricing, CRM, digital…
- From Marketers to Marketing
o Who manages customer touchpoints?
o The importance of breaking corporate silos
- Marketing as a Philosophy
o Putting the customer at the center of all you do
o “Marketing is not only much broader than selling, it is not a specialized
activity at all. It encompasses the entire business. It is the whole business
seen from the point of view of the final result, that is, form the customer’s
point of view. ~ Peter Drucker
- Marketing versus Strategy
o Definition of Marketing
Marketing is the process of identifying and profitably satisfying
customers’ wants and needs.
o Definition of Strategy
Business strategy is a clear set of plans, actions and goals that outline
how a business will compete in a particular market, or markets, with a
product or number of products or services.
Marketing=Strategy If companies are bundles of processes designed to
deliver customer value
- The Goal & How to get there.
o Market Forces Change Management Profitable Growth
5Cs: Customers, Competitors, Company, Collaborators, Context
, Porter’s 5 Forcers, Competition in the industry, Potential of new
entrants, Power of suppliers, Power of customers, threat of substitute
products.
Marketing is Changing
- From Product Orientation
o “Marketing is the execution of business activities aimed at navigating a
stream of products and services from the manufacturers to the customer” ~
1960.
no customers involved, product centric definition.
French wine is still product oriented, assume which grapes are in the
wine due to region.
- Over Customer Orientation
o Marketing is the process of identifying and profitably satisfying customer
wants and needs ~ 1990.
The example of the drill (Black and Decker): solution to the need to
make holes.
Conclusion: most people don’t own drills because average is zero
holes per year
YET most people DO own drills, why?
The need is: the need to feel independent, I have my own drill.
Professional handymen did not purchase that brand, because
customer usually has that type of drill, not looking professional
enough.
Solution: created another sub brand to target that segment
Fastest growing segment, women moving out, want to be
independent again.
- To? Where are we going?
o Implicit assumption at the heart of traditional marketing thought “As long as
consumption creates value both consumers and companies, we should
encourage unlimited consumption.”
o We need to rethink this assumption.
- To a System-Orientation?
o Market Forces Change Management Shared Value
Example: Mark and Spencer; climate neutral in 2040
- Market Forces Innovation Shared Value
- Mini Case Study
Danone; One planet. One Health. Purpose driven company that has a mission statement. ~
Emmanuel Faber
, o Mission statement should give purpose to the company identity to the brand
and act as a catalyst for innovation at all levels. (Entreprise-à-mission)
o Financial Innovation: New Profitability Metric Carbon Adjusted Earnings
per Share
o Product Innovation: 100% recycled bottle; Evian big bottle dispenser without
label than thick plastic for each bottle.
o Consistent Communication: Dua Lipa spokesperson in a pure way acapella, to
highlight the purity of the brand.
o Purpose needs to be “strong”: increase faith, trust, awareness if done well.
o Yet if there are inconsistencies it can become a weak case and perform badly.
(Example: Gillette)
o Especially with the “Pink Tax” they still apply, people get offended.
- Doing well by doing good
o Financial performance benefits of shared value:
Enhanced firm reputation
Stakeholder endorsement
Both internal and external
Risk mitigation
Improved innovative capacity.
Via access to knowledge and internal capabilities
- Purpose can and will cost money though.
, Lecture 2 – Principles of Resource Allocation
- This lecture focuses on resource allocation, which is involved in the change
management box. It is about the marketing budget and how to allocate these
resources
- Two dimensions of Resource allocation
o Horizontal: think about how you have multiple brands that the company
works with. You can classify that at the horizontal division, where you decide
where you spend your resources. It is the highest level of decision
Most strategic level→the highest level where you make the decisions
as where you see the most golden opportunity for the future
o Vertical: for each of the brands, you have a bunch of secondary decisions to
make. It’s about distribution. Communication. Brand management.
Product place, promotion, price (4Ps etc.)
Tactical decisions. Think of the 4Ps!
- Starting off at the strategic / horizontal level first
- Why is horizontal resource allocation / brandporfolio management necessary?
o The branded house: one brand where they put their brand on
almost everything they do. Example used in the lecture is Virgin airlines
o The house of brands: huge array of different activities because they look like
different brands. EG P&G is a house that brings them together
o why is it necessary? BP management has to be done because: if you don’t
manage them carefully, things get out of hand or that they forgot they
(company) have a brand→ competitors can scoop them up
Blurring of brands / not knowing what it stands for→this can happen
for both the consumer and the company itself
As consumers we like brands because: it is a shorthand function to
know what quality we are going to get, they are a search cost reducing
in a way.
o Disadvantages of large brand portfolios
Fragmentation of marketing resources, opportunity costs
Destroying economies of scale
Management attention dilution
Brand blurring
Example: the car example, how some cars are almost replicas (where
the same (house of brands manages them)→because it saves cost
right, but the brand differentiation also goes down→kills you in the
long run.
- The Boston consulting group BCG growth share matrix / BCG matrix
o Relative market share versus market growth rate, and they give you 4
quadrants
o Relative market share is positioned from high to low → the mid-point that
dives the quadrants (labelled as ‘1’) indicates your position relative to that of
Lecture 1 - Introduction
- What is Marketing? How do people in business often think about marketing?
- A Love of Tactics: Marketing 4P’s
o Marketing as tactics
Sales promotions and coupons
Advertising, logos, brochures…
o Marketing as cost (vs. investment)
The accountability problem (hard to monitor the returns and justify)
The accounting problem (marketing cannot generate anything:
necessary cost)
o Surrendered decisions to other dept.
Pricing, CRM, digital…
- From Marketers to Marketing
o Who manages customer touchpoints?
o The importance of breaking corporate silos
- Marketing as a Philosophy
o Putting the customer at the center of all you do
o “Marketing is not only much broader than selling, it is not a specialized
activity at all. It encompasses the entire business. It is the whole business
seen from the point of view of the final result, that is, form the customer’s
point of view. ~ Peter Drucker
- Marketing versus Strategy
o Definition of Marketing
Marketing is the process of identifying and profitably satisfying
customers’ wants and needs.
o Definition of Strategy
Business strategy is a clear set of plans, actions and goals that outline
how a business will compete in a particular market, or markets, with a
product or number of products or services.
Marketing=Strategy If companies are bundles of processes designed to
deliver customer value
- The Goal & How to get there.
o Market Forces Change Management Profitable Growth
5Cs: Customers, Competitors, Company, Collaborators, Context
, Porter’s 5 Forcers, Competition in the industry, Potential of new
entrants, Power of suppliers, Power of customers, threat of substitute
products.
Marketing is Changing
- From Product Orientation
o “Marketing is the execution of business activities aimed at navigating a
stream of products and services from the manufacturers to the customer” ~
1960.
no customers involved, product centric definition.
French wine is still product oriented, assume which grapes are in the
wine due to region.
- Over Customer Orientation
o Marketing is the process of identifying and profitably satisfying customer
wants and needs ~ 1990.
The example of the drill (Black and Decker): solution to the need to
make holes.
Conclusion: most people don’t own drills because average is zero
holes per year
YET most people DO own drills, why?
The need is: the need to feel independent, I have my own drill.
Professional handymen did not purchase that brand, because
customer usually has that type of drill, not looking professional
enough.
Solution: created another sub brand to target that segment
Fastest growing segment, women moving out, want to be
independent again.
- To? Where are we going?
o Implicit assumption at the heart of traditional marketing thought “As long as
consumption creates value both consumers and companies, we should
encourage unlimited consumption.”
o We need to rethink this assumption.
- To a System-Orientation?
o Market Forces Change Management Shared Value
Example: Mark and Spencer; climate neutral in 2040
- Market Forces Innovation Shared Value
- Mini Case Study
Danone; One planet. One Health. Purpose driven company that has a mission statement. ~
Emmanuel Faber
, o Mission statement should give purpose to the company identity to the brand
and act as a catalyst for innovation at all levels. (Entreprise-à-mission)
o Financial Innovation: New Profitability Metric Carbon Adjusted Earnings
per Share
o Product Innovation: 100% recycled bottle; Evian big bottle dispenser without
label than thick plastic for each bottle.
o Consistent Communication: Dua Lipa spokesperson in a pure way acapella, to
highlight the purity of the brand.
o Purpose needs to be “strong”: increase faith, trust, awareness if done well.
o Yet if there are inconsistencies it can become a weak case and perform badly.
(Example: Gillette)
o Especially with the “Pink Tax” they still apply, people get offended.
- Doing well by doing good
o Financial performance benefits of shared value:
Enhanced firm reputation
Stakeholder endorsement
Both internal and external
Risk mitigation
Improved innovative capacity.
Via access to knowledge and internal capabilities
- Purpose can and will cost money though.
, Lecture 2 – Principles of Resource Allocation
- This lecture focuses on resource allocation, which is involved in the change
management box. It is about the marketing budget and how to allocate these
resources
- Two dimensions of Resource allocation
o Horizontal: think about how you have multiple brands that the company
works with. You can classify that at the horizontal division, where you decide
where you spend your resources. It is the highest level of decision
Most strategic level→the highest level where you make the decisions
as where you see the most golden opportunity for the future
o Vertical: for each of the brands, you have a bunch of secondary decisions to
make. It’s about distribution. Communication. Brand management.
Product place, promotion, price (4Ps etc.)
Tactical decisions. Think of the 4Ps!
- Starting off at the strategic / horizontal level first
- Why is horizontal resource allocation / brandporfolio management necessary?
o The branded house: one brand where they put their brand on
almost everything they do. Example used in the lecture is Virgin airlines
o The house of brands: huge array of different activities because they look like
different brands. EG P&G is a house that brings them together
o why is it necessary? BP management has to be done because: if you don’t
manage them carefully, things get out of hand or that they forgot they
(company) have a brand→ competitors can scoop them up
Blurring of brands / not knowing what it stands for→this can happen
for both the consumer and the company itself
As consumers we like brands because: it is a shorthand function to
know what quality we are going to get, they are a search cost reducing
in a way.
o Disadvantages of large brand portfolios
Fragmentation of marketing resources, opportunity costs
Destroying economies of scale
Management attention dilution
Brand blurring
Example: the car example, how some cars are almost replicas (where
the same (house of brands manages them)→because it saves cost
right, but the brand differentiation also goes down→kills you in the
long run.
- The Boston consulting group BCG growth share matrix / BCG matrix
o Relative market share versus market growth rate, and they give you 4
quadrants
o Relative market share is positioned from high to low → the mid-point that
dives the quadrants (labelled as ‘1’) indicates your position relative to that of
