Part 2 book “Marketing an introduction” has contents: Marketing channels and supply chain management, retailing and wholesaling, communicating customer value - advertising, sales promotion and public relations, marketing in the digital age,… and other contents.
www.downloadslide.net CHAPTER 10 MARKETING CHANNELS AND SUPPLY CHAIN MANAGEMENT AFTER STUDYING THIS CHAPTER, YOU SHOULD BE ABLE TO ● explain why companies use distribution channels and discuss the functions these channels perform ● discuss how channel members interact and how they organise to perform the work of the channel ● identify the major channel alternatives open to a company ● explain how companies select, motivate and evaluate channel members ● discuss the nature and importance of marketing logistics and integrated supply chain management M10_ARMS7518_03_SE_C10.indd 332 02/07/15 5:17 pm www.downloadslide.net THE WAY AHEAD Previewing the concepts We now arrive at the third marketing mix tool – distribution Firms rarely work alone in creating value for customers and building profitable customer relationships Instead, most are only a single link in a larger supply chain and distribution channel As such, an individual firm’s success depends not only on how well it performs, but also on how well its entire distribution channel competes with competitors’ channels To be good at customer relationship management, a company must also be good at partner relationship management The first part of this chapter explores the nature of distribution channels and the marketer’s channel design and management decisions We then examine physical distribution – or logistics – an area that is growing dramatically in importance and sophistication In the next chapter, we’ll look more closely at two major channel intermediaries – retailers and wholesalers To get us started, we’ll take a close look at a mediumsized Spanish paint company, Pinturas Fierro, which has had to solve quite a few distribution and logistical issues as it has grown and entered international markets Good management of the distribution system has been a key component in enabling this family firm to survive and thrive for over 70 years Read on and see why CHAPTER CONTENTS Supply chains and the value-delivery network 336 The nature and importance of marketing channels 337 How channel members add value 337 Number of channel levels 338 Channel behaviour and organisation 339 Channel behaviour 340 Vertical marketing systems 341 Horizontal marketing systems 343 Multichannel distribution systems 343 Changing channel organisation 344 Channel design decisions 347 Analysing consumer needs 347 Setting channel objectives 348 Identifying major alternatives 348 Evaluating the major alternatives 349 Designing international distribution channels 350 Channel management decisions 350 Selecting channel members 350 Managing and motivating channel members 351 Evaluating channel members 351 Public policy and distribution decisions 352 Marketing logistics and supply chain management 352 Nature and importance of marketing logistics 352 Goals of the logistics system 353 Major logistics functions 354 Integrated logistics management 357 M10_ARMS7518_03_SE_C10.indd 333 02/07/15 5:17 pm www.downloadslide.net 334 PART THREE DESIGNING A CUSTOMER-DRIVEN MARKETING STRATEGY AND MARKETING MIX PINTURAS FIERRO: SLOW BUT SAFE GROWTH Jesús Cambra Fierro Pinturas Fierro is a Spanish family company devoted to the production and distribution of paint for industrial use, such as the car and the decoration industries; the company also produces solvents and other auxiliary products It demonstrates some characteristic features for a medium-sized business: a fairly small number of employees, management of the business handled by the owners, and relatively few specialists in management positions The company was created in 1930 by the family that owns and runs it today Currently the third generation runs the company while the fourth generation is receiving training in the fields of chemistry and business administration in order to take over control and management of The retail team at Pinturas Fierro the company in the future Since its creation the company has Source: Photo by Jesús Cambra Fierro been characterised by great dynamism and an eagerness Valencia and Andalusia; there is an international presence to grow Initially, the company was a small local shop that through non-exclusive distributors in France, northern Italy sold paint, varnish and accessories When the founder’s and, on a smaller scale, in Portugal and Morocco son took charge of the business, in 1943, the location Throughout most of the history of Pinturas Fierro the changed to the commercial area of Barbastro, their home company has relied less on formal management printown in northern Spain, and they established a provincial ciples and more on the intuitive business sense of the and regional network for the exclusive distribution of the owners Because the people that have run the company most highly respected paint brands in Spain (such as Titan always knew that they were dealing with the present and and Valentine) During this period the company became future of their family, they were never tempted to take on well established in its home region and began to expand excessive risks Besides, they were chemists rather than into neighbouring France In the early 1980s the imporbusinessmen This has led to a fairly cautious approach to tant decision was made to invest in manufacturing facilities business expansion, with a clear focus on producing highfor paint, varnish and solvents The first production activiquality products even if this meant that prices sometimes ties coincided with the arrival of the third generation into had to be higher than those of rivals the company’s management in 1986 However, although Let’s now take a look at how the company has managed members of the family had excellent knowledge of chemits expansion, and how it has consistently and carefully augistry they had little training in business management, and mented the distribution channels that it employs The first this began to hamper the company’s development After stage of the expansion was characterised by the creation of a period of consolidation, during which managerial skills a simple distribution network, covering 75–100 kilometres were developed, the business began to look for expansion from the physical location of the firm The problem here opportunities nationally and internationally was that the area is mountainous (near the Pyrenees) and Today the company is divided into two fundamental the transport infrastructure was poorly developed Howareas: first, production and distribution (wholesaling) to ever, the company exploited the absence of competitors industrial customers; and, second, distribution (wholesalinterested in the area This territory was neither attractive ing) to commercial customers and retailers The company nor profitable for distant companies, whereas, for Pinturas has 16 employees, and in 2005 sales turnover amounted to Fierro, it was its home territory and all it needed was a €4.5m The centre of operations is still in the Spanish market, driver with a van who could make deliveries and handle especially in Aragon, Catalonia, industrial areas of Madrid, logistical matters Using this simple commercial network M10_ARMS7518_03_SE_C10.indd 334 02/07/15 5:17 pm www.downloadslide.net CHAPTER 10 MARKETING CHANNELS AND SUPPLY CHAIN MANAGEMENT the company obtained exclusive dealership within the local area for several of the most prestigious national and international brands, like Valentine and Titan However, the growing business led to the need to increase the stock of products stored and to have actual space for it The company acquired two fairly small warehouses in the same town, one for paints and varnishes, the other for accessory products The 1980s saw further expansion of the business and the addition of a new product line: accessory machinery This line included air compressors and power generators However, this increased the complexity of the management task considerably New brands like Peugeot and Pintuc were added to the portfolio, and it became clear that the company needed more space in which to exhibit and store the products, and to offer technical support In particular, in this industry, customers often give equipment maintenance a low priority, and expect the dealer to sort out any problems quickly when equipment breaks down Customer service is a priority During this period more employees were hired: one as warehouse manager, one to handle the accounts and administration, and two as commercial salespeople Two delivery vehicles were acquired and agreements on physical distribution were signed with specialised companies so that commercial staff no longer had to handle the physical distribution of the product As a result the sales team could spend more time on existing customers and prospecting for new customers As transport infrastructure improved in the 1980s, so several competing companies became interested in the home territory of Pinturas Fierro At the same time several new brands emerged with very aggressive pricing strategies All these factors reduced profit margins and meant that the company had to handle a wider range of brands In any case, Pinturas Fierro had been able to build a commercial network perfectly adapted to the physical and social features of the territory The company had a good reputation for the technical training of its salespeople, its commitment to meet customer deadlines, the size of its product portfolio and its willingness to meet the specific needs of every customer As the company developed its production facilities and began to sell its own products, rather than simply to distribute those of other companies, new challenges emerged Establishing distribution channels, and handling logistics, for its own products became matters of serious concern Key target markets were in the industrial centres of Catalonia and, inevitably, in Madrid, where the concentration of business was highest Although Pinturas Fierro wanted to establish exclusive distributorships, it was not well known as a manufacturer and so found this very difficult Consequently, it decided to sell its products through distributors that also handled other brands The company looked for M10_ARMS7518_03_SE_C10.indd 335 335 distributors who specialised in industrial customers with a wide portfolio Potential distributors were invited to the factory so that they could learn about the production process and how the product could be customised to meet the needs of particular industrial customers Pinturas Fierro managers regularly visited Madrid and Barcelona to meet potential customers This way they both demonstrated their support to the distributor and surveyed the actual needs of the market This information, together with the feedback generated by the distributor, considerably enriched the company’s knowledge of the market What about international markets? They were considered to be of secondary importance compared with getting established in Spain But by the 1990s the management felt that the company was mature enough to expand internationally The route selected to enter foreign markets was by exporting, building relationships with distributors in international markets in the same way that it had built relationships with Spanish distributors Expanding into inter-national markets was expected to enhance the reputation of the company back home in Spain Pinturas Fierro followed a typical internationalisation strategy for a medium-sized firm, making the nearby countries of France and Italy their first targets The company has taken part in trade missions and international trade fairs Gradually the proportion of exports in total sales has been increasing What are the challenges that Pinturas Fierro faces in the future? The company, true to its origins, still sells to the retail trade and still distributes the Valentine and Titan brands Although the retail trade is fairly small, it has always been there and has always provided funds for the company’s new ventures Further, the management of the business is emotionally attached to the retail trade and would not want to see it go The company has been working on enlarging the central main warehouse and the manufacturing facilities, and investing in new, improved logistics technology designed to improve physical stock management Working relationships with suppliers are very satisfactory, and the managers are working hard to maintain and improve them Similarly, the company understands that its distributors are the principal point of contact with the customers, and so will continue to invest time and effort in developing excellent distributor relationships The challenge of further internationalisation is always present The company is hampered because few employees can speak a foreign language, and, in any case, it currently has limited production capacity with which to expand further in international markets However, as the next generation of the family comes into the business, fully trained in modern management and marketing techniques, perhaps they will take the plunge and launch Pinturas Fierro decisively into the international arena Sources: Based on interviews with the owners and managers 02/07/15 5:17 pm www.downloadslide.net 336 PART THREE DESIGNING A CUSTOMER-DRIVEN MARKETING STRATEGY AND MARKETING MIX Just like Pinturas Fierro, most firms cannot bring value to customers by themselves Instead, they must work closely with other firms in a larger value-delivery network SUPPLY CHAINS AND THE VALUE-DELIVERY NETWORK Producing a product or service and making it available to buyers requires building relationships not just with customers, but also with key suppliers and resellers in the company’s supply chain This supply chain consists of ‘upstream’ and ‘downstream’ partners Upstream from the company is the set of firms that supply the raw materials, components, parts, information, finances and expertise needed to create a product or service Marketers, however, have traditionally focused on the ‘downstream’ side of the supply chain – on the marketing channels or distribution channels that look forward towards the customer Downstream marketing-channel partners, such as wholesalers and retailers, form a vital connection between the firm and its customers Both upstream and downstream partners may also be part of other firms’ supply chains But it is the unique design of each company’s supply chain that enables it to deliver superior value to customers An individual firm’s success depends not only on how well it performs, but also on how well its entire supply chain and marketing channel competes with competitors’ channels The term supply chain may be too limited – it takes a make-and-sell view of the business It suggests that raw materials, productive inputs and factory capacity should serve as the starting point for market planning A better term would be demand chain because it suggests a sense-and-respond view of the market Under this view, planning starts with the needs of target customers, to which the company responds by organising a chain of resources and activities with the goal of creating customer value Even a demand-chain view of a business may be too limited, because it takes a step-bystep, linear view of purchase–production–consumption activities With the advent of the Internet and other technologies, however, companies are forming more numerous and complex relationships with other firms For example, Ford manages numerous supply chains It also sponsors or transacts on many B2B websites and online purchasing exchanges as needs arise Like Ford, most large companies today are engaged in building and managing a continuously evolving value-delivery network As defined earlier (see Chapter 2), a value-delivery network is made up of the company, suppliers, distributors and ultimately customers who ‘partner’ with each other to improve the performance of the entire system For example, Samsung, a leading manufacturer of mobile phones, manages a whole community of suppliers and assemblers of semiconductor components, plastic cases, colour displays and accessories Its network also includes offline and online resellers All of these diverse partners must work effectively together to bring superior value to Samsung’s customers This chapter focuses on marketing channels – on the downstream side of the valuedelivery network However, it is important to remember that this is only part of the full value network To bring value to customers, companies need upstream supplier partners just as they need downstream channel partners Increasingly, marketers are participating in and influencing their company’s upstream activities as well as its downstream activities More than marketing-channel managers, they are becoming full value network managers The chapter examines four major questions concerning marketing channels What is the nature of marketing channels and why are they important? How channel firms interact and organise to the work of the channel? What problems companies face in designing and managing their channels? What role physical distribution and supply chain management play in attracting and satisfying customers? We will look later at marketing-channel issues from the viewpoint of retailers and wholesalers (see Chapter 11) M10_ARMS7518_03_SE_C10.indd 336 02/07/15 5:17 pm www.downloadslide.net CHAPTER 10 MARKETING CHANNELS AND SUPPLY CHAIN MANAGEMENT 337 THE NATURE AND IMPORTANCE OF MARKETING CHANNELS Few producers sell their goods directly to the final users Instead, most use intermediaries to bring their products to market They try to forge a marketing channel (or distribution channel) – a set of interdependent organisations that help make a product or service available for use or consumption by the consumer or business user A company’s channel decisions directly affect every other marketing decision Pricing depends on whether the company works with national discount chains, uses high-quality speciality stores, or sells directly to consumers via the Web The firm’s sales force and communications decisions depend on how much persuasion, training, motivation and support its channel partners need Whether a company develops or acquires certain new products may depend on how well those products fit the capabilities of its channel members Companies often pay too little attention to their distribution channels, sometimes with damaging results In contrast, many companies have used imaginative distribution systems to gain a competitive advantage FedEx’s creative and imposing distribution system made it a leader in express delivery Dell revolutionised its industry by selling PCs directly to consumers rather than through retail stores Amazon pioneered the sales of books and a wide range of other goods via the Internet Distribution channel decisions often involve long-term commitments to other firms For example, companies such as PSA Peugeot Citroën, Samsung or Toshiba can easily change their advertising, pricing or promotion programmes They can scrap old products and introduce new ones as market tastes demand But when they set up distribution channels through contracts with franchisees, independent dealers or large retailers, they cannot readily replace these channels with company-owned stores or websites if conditions change Therefore, management must design its channels carefully, with an eye on tomorrow’s likely selling environment as well as today’s How channel members add value Why producers give some of the selling job to channel partners? After all, doing so means giving up some control over how and to whom they sell their products Producers use intermediaries because they create greater efficiency in making goods available to target markets Through their contacts, experience, specialisation and scale of operation, intermediaries usually offer the firm more than it can achieve on its own Figure 10.1 shows how using intermediaries can provide economies Figure 10.1A shows three manufacturers, each using direct marketing to reach three customers This system requires nine different contacts Figure 10.1B shows the three manufacturers working through one distributor, which contacts the three customers This system requires only six contacts In this way, intermediaries reduce the amount of work that must be done by both producers and consumers From an economic point of view the role of marketing intermediaries is to transform the assortments of products made by producers into the assortments wanted by consumers Producers make narrow assortments of products in large quantities, but consumers want broad assortments of products in small quantities Marketing-channel members buy large quantities from many producers and break them down into the smaller quantities and broader assortments wanted by consumers For example, Nestlé makes millions of KitKat bars each day, but you want to buy only a few bars at a time So big food, drug and discount retailers, such as Carrefour, Lidl, Aldi and Tesco, buy KitKat by the truckload and stock it on their stores’ shelves In turn, you can buy a single KitKat, along with a shopping trolley full of small quantities of toothpaste, shampoo and other related products as you need them Thus, intermediaries play an important role in matching supply and demand M10_ARMS7518_03_SE_C10.indd 337 02/07/15 5:17 pm www.downloadslide.net 338 PART THREE DESIGNING A CUSTOMER-DRIVEN MARKETING STRATEGY AND MARKETING MIX FIGURE 10.1 How a distributor reduces the number of channel transactions In making products and services available to consumers, channel members add value by bridging the major time, place and possession gaps that separate goods and services from those who would use them Members of the marketing channel perform many key functions Some help to complete transactions: ● ● ● ● ● Information: Gathering and distributing marketing research and intelligence information about actors and forces in the marketing environment needed for planning and aiding exchange Promotion: Developing and spreading persuasive communications about an offer Contact: Finding and communicating with prospective buyers Matching: Shaping and fitting the offer to the buyer’s needs, including activities such as manufacturing, grading, assembling and packaging Negotiation: Reaching an agreement on price and other terms of the offer so that ownership or possession can be transferred Others help to fulfil the completed transactions: ● ● ● Physical distribution: Transporting and storing goods Financing: Acquiring and using funds to cover the costs of the channel work Risk taking: Assuming the risks of carrying out the channel work The question is not whether these functions need to be performed – they must be – but rather who will perform them To the extent that the manufacturer performs these functions, its costs go up and its prices have to be higher When some of these functions are shifted to intermediaries, the producer’s costs and prices may be lower, but the intermediaries must charge more to cover the costs of their work In dividing the work of the channel, the various functions should be assigned to the channel members who can add the most value for the cost Number of channel levels Companies can design their distribution channels to make products and services available to customers in different ways Each layer of marketing intermediaries that performs some M10_ARMS7518_03_SE_C10.indd 338 02/07/15 5:17 pm www.downloadslide.net CHAPTER 10 MARKETING CHANNELS AND SUPPLY CHAIN MANAGEMENT 339 FIGURE 10.2 Consumer and business marketing channels work in bringing the product and its ownership closer to the final buyer is a channel level Because the producer and the final consumer both perform some work, they are part of every channel The number of intermediary levels indicates the length of a channel Figure 10.2A shows several consumer distribution channels of different lengths Channel 1, called a direct marketing channel, has no intermediary levels; the company sells directly to consumers For example, both Avon and Essentially Yours sell cosmetic products through home and office sales parties and on the Web; Interflora sells flowers, gifts and greeting cards direct by telephone and online The remaining channels in Figure 10.2A are indirect marketing channels, containing one or more intermediaries Figure 10.2B shows some common business distribution channels The business marketer can use its own sales force to sell directly to business customers, or it can sell to various types of intermediaries, who in turn sell to these customers Consumer and business marketing channels with even more levels can sometimes be found, but less often From the producer’s point of view, a greater number of levels mean less control and greater channel complexity Moreover, all of the institutions in the channel are connected by several types of flows These include the physical flow of products, the flow of ownership, the payment flow, the information flow and the promotion flow These flows can make even channels with only one or a few levels very complex CHANNEL BEHAVIOUR AND ORGANISATION Distribution channels are more than simple collections of firms tied together by various flows They are complex behavioural systems in which people and companies interact to accomplish individual, company and channel goals Some channel systems consist only of informal interactions among loosely organised firms Others consist of formal interactions guided by strong organisational structures Moreover, channel systems not stand still – new types of intermediaries emerge and whole new channel systems evolve Here we look at channel behaviour and at how members organise to the work of the channel M10_ARMS7518_03_SE_C10.indd 339 02/07/15 5:17 pm www.downloadslide.net 340 PART THREE DESIGNING A CUSTOMER-DRIVEN MARKETING STRATEGY AND MARKETING MIX Channel behaviour A marketing channel consists of firms that have partnered for their common good Each channel member depends on the others For example, a Peugeot dealer depends on Peugeot to design cars that meet consumer needs In turn, Peugeot depends on the dealer to attract consumers, persuade them to buy Peugeot cars, and service cars after the sale Each Peugeot dealer also depends on other dealers to provide good sales and service that will uphold the brand’s reputation In fact, the success of individual Peugeot dealers depends on how well the entire Peugeot marketing channel competes with the channels of other auto manufacturers Each channel member plays a specialised role in the channel For example, Sony’s role is to produce consumer electronics products that consumers will like and to create demand through national advertising The role of electrical retailers like Fnac and Currys is to display these Sony products in convenient locations, to answer buyers’ questions and to complete sales The channel will be most effective when each member takes on the tasks it can best Ideally, because the success of individual channel members depends on overall channel success, all channel firms should work together smoothly They should understand and accept their roles, coordinate their activities and cooperate to attain overall channel goals However, individual channel members rarely take such a broad view Cooperating to achieve overall channel goals sometimes means giving up individual company goals Although channel members depend on one another, they often act alone in their own short-term best interests They often disagree on who should what and for what rewards Such disagreements over goals, roles and rewards generate channel conflict Horizontal conflict occurs among firms at the same level of the channel For instance, some Peugeot dealers in Madrid might complain that other dealers in the city steal sales from them by pricing too low or by advertising outside their assigned territories Or Holiday Inn franchisees might complain about other Holiday Inn operators overcharging guests or giving poor service, hurting the overall Holiday Inn image Vertical conflict, conflicts between different levels of the same channel, is even more common For example, Goodyear created hard feelings and conflict with its premier independent-dealer channel when it began selling through mass-merchant retailers For more than 60 years, Goodyear sold replacement tyres exclusively through its premier network of 5,300 independent Goodyear dealers In mid-1992, however, Goodyear jolted its dealers by agreeing to sell its tyres through Sears auto centres Similar pacts soon followed with Wal-Mart and Sam’s Club, pitting dealers against the nation’s most potent retailers Goodyear claimed that the change was essential Value-minded tyre buyers were increasingly buying from cheaper, multibrand discount outlets and department stores By selling exclusively through its dealer network, Goodyear simply was not putting its tyres where many consumers were going to buy them Unfortunately, as Goodyear expanded into the new channels, it took few steps to protect its prized exclusive-dealer network Not surprisingly, Goodyear’s aggressive moves into new channels set off a surge of channel conflict, and dealer relations deteriorated rapidly Some of Goodyear’s best dealers defected to competitors Other angry dealers struck back by taking on competing brands of cheaper private-label tyres Such dealer actions weakened the Goodyear name, and the company’s replacement tyre sales – which made up 73 per cent of its revenues – went flat, dropping the Channel conflict: Goodyear’s company into a profit funk more than a decade long Although Goodyear has conflicts with its independent since repaired fractured dealer relations, it still has not fully recovered ‘We dealers have caused hard feelings lost sight of the fact that it’s in our interest that our dealers succeed,’ admits and flattened the company’s replacement tyre sales a Goodyear executive.1 Some conflict in the channel takes the form of healthy competition Such Source: Getty Images/Mike Ehrmann competition can be good for the channel – without it, the channel could M10_ARMS7518_03_SE_C10.indd 340 02/07/15 5:18 pm www.downloadslide.net CHAPTER 10 MARKETING CHANNELS AND SUPPLY CHAIN MANAGEMENT 341 become passive and non-innovative But severe or prolonged conflict, as in the case of Goodyear, can disrupt channel effectiveness and cause lasting harm to channel relationships Companies should manage channel conflict to keep it from getting out of hand Vertical marketing systems For the channel as a whole to perform well, each channel member’s role must be specified and channel conflict must be managed The channel will perform better if it includes a firm, agency or mechanism that provides leadership and has the power to assign roles and manage conflict Historically, conventional distribution channels have lacked such leadership and power, often resulting in damaging conflict and poor performance One of the biggest channel developments over the years has been the emergence of vertical marketing systems that provide channel leadership Figure 10.3 contrasts the two types of channel arrangements A conventional distribution channel consists of one or more independent producers, wholesalers and retailers Each is a separate business seeking to maximise its own profits, perhaps even at the expense of the system as a whole No channel member has much control over the other members, and no formal means exists for assigning roles and resolving channel conflict In contrast, a vertical marketing system (VMS) consists of producers, wholesalers and retailers acting as a unified system One channel member owns the others, has contracts with them or wields so much power that they must all cooperate The VMS can be dominated by the producer, wholesaler or retailer We look now at three major types of VMSs: corporate, contractual and administered Each uses a different means for setting up leadership and power in the channel Corporate VMS A corporate VMS integrates successive stages of production and distribution under single ownership Coordination and conflict management are attained through regular organisational channels For example, French car manufacturer Citroën has local subsidiary companies responsible for selling in national markets, such as Citroën Espana, Citroën Deutschland and Citroën UK.2 The fantasy games company Games Workshop designs, manufactures, distributes and retails its own range of products, so retaining complete control over the FIGURE 10.3 Comparison of conventional distribution channel with vertical marketing system M10_ARMS7518_03_SE_C10.indd 341 02/07/15 5:18 pm www.downloadslide.net 606 GLOSSARY relationships across functional areas inside the company and across various organisations in the supply chain Intensive distribution Stocking the product in as many outlets as possible Interactive marketing Marketing by a service firm that recognises that perceived service quality depends heavily on the quality of buyer–seller interaction, either face to face or using Internet-related tools Intermarket segmentation Forming segments of consumers who have similar needs and buying behaviour even though they are located in different countries Intermodal transportation Combining two or more modes of transportation Internal databases Electronic collections of consumer and market information obtained from data sources within the company network Internal marketing Marketing by a service firm to train and effectively motivate its customer-contact employees and all the supporting service people to work as a team to provide customer satisfaction Internet A vast public web of computer networks, which connects users of all types all around the world to each other and to an amazingly large ‘information repository’ Intranet A network that connects people within a company to each other and to the company network and excludes those outside this network (see Extranet) Introduction stage The product life-cycle stage in which the new product is first distributed and made available for purchase Joint ownership A joint venture in which a company joins investors in a foreign market to create a local business in which the company shares joint ownership and control Joint venturing Entering foreign markets by joining with other companies to produce or market a product or service Learning Changes in an individual’s behaviour arising from experience Licensing A method of entering a foreign market in which the company enters into 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 Lifestyle A person’s pattern of living as expressed in his or her activities, interests and opinions Line extension Using a successful brand name to introduce additional items in a given product category under the same brand name, such as new flavours, forms, colours, added ingredients or package sizes Local marketing Tailoring brands and promotions to the needs and wants of local customer groups – cities, neighbourhoods and even specific stores Macroenvironment The larger societal forces that affect the microenvironment – demographic, economic, legal, technological, political and cultural forces Z04_ARMS7518_03_SE_GLOS.indd 606 Management contracting A joint venture in which the domestic firm supplies the management know-how to a foreign company that supplies the capital; the domestic firm exports management services rather than products Manufacturers’ sales branches and offices Wholesaling by sellers or buyers themselves rather than through independent wholesalers Market The set of all actual and potential buyers of a product or service Market development A strategy for company growth by identifying and developing new market segments for current company products Market offering Some combination of products, services, information or experiences offered to a market to satisfy a need or want Market penetration A strategy for company growth by increasing sales of current products to current market segments without changing the product Market-penetration pricing Setting a low price for a new product in order to attract a large number of buyers and a large market share Market positioning Arranging for a product to occupy a clear, distinctive and desirable place relative to competing products in the minds of target consumers Market segment A group of consumers who respond in a similar way to a given set of marketing efforts Market segmentation Dividing a market into distinct groups with distinct needs, characteristics or behaviours who might require separate products or marketing mixes Market-skimming pricing Setting a high price for a new product to skim maximum revenues layer by layer from the segments willing to pay the high price; the company makes fewer but more profitable sales Marketing The process by which companies create value for customers and build strong customer relationships in order to capture value from customers in return The AMA defines marketing as ‘an organizational function and a set of processes for creating, communicating, and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders’ Marketing audit A comprehensive, systematic, independent and periodic examination of a company’s environment, objectives, strategies and activities to determine problem areas and opportunities and to recommend a plan of action to improve the company’s marketing performance Marketing channel A set of interdependent organisations that help make a product or service available for use or consumption by the consumer or business user Marketing concept The marketing management philosophy that holds that achieving organisational goals depends on knowing the needs and wants of target markets and delivering the desired satisfactions better than competitors 02/07/15 8:59 pm www.downloadslide.net GLOSSARY Marketing control The process of measuring and evaluating the results of marketing strategies and plans, and taking corrective action to ensure that objectives are achieved Marketing environment The actors and forces outside marketing that affect marketing management’s ability to build and maintain successful relationships with target customers Marketing implementation The process that turns marketing strategies and plans into marketing actions in order to accomplish strategic marketing objectives Marketing information system (MIS) People, equipment and procedures to gather, sort, analyse, evaluate and distribute needed, timely and accurate information to marketing decision makers 607 suppliers, marketing intermediaries, customer markets, competitors and publics Micromarketing The practice of tailoring products and marketing programmes to the needs and wants of specific individuals and local customer groups – includes local marketing and individual marketing Mission statement A statement of the organisation’s purpose – what it wants to accomplish in the larger environment Modified rebuy A business buying situation in which the buyer wants to modify product specifications, prices, terms or suppliers Motive (drive) A need that is sufficiently pressing to direct the person to seek satisfaction of the need Marketing intelligence The systematic collection and analysis of publicly available information about competitors and developments in the marketing environment Multichannel distribution system A distribution system in which a single firm sets up two or more marketing channels to reach one or more customer segments Marketing intermediaries Firms that help the company to promote, sell and distribute its goods to final buyers; they include resellers, physical distribution firms, marketing service agencies and financial intermediaries Natural environment Natural resources that are needed as inputs by marketers or that are affected by marketing activities Marketing logistics (or physical distribution) The tasks involved in planning, implementing and controlling the physical flow of materials, final goods and related information from points of origin to points of consumption to meet customer requirements at a profit Marketing management The art and science of choosing target markets and building profitable relationships with them Marketing mix The set of controllable tactical marketing tools – product, price, place and promotion – that the firm blends to produce the response it wants in the target market Marketing myopia The mistake of paying more attention to the specific products a company offers than to the benefits and experiences produced by those products Marketing research The systematic design, collection, analysis and reporting of data relevant to a specific marketing situation facing an organisation Marketing strategy The marketing logic by which the business unit hopes to achieve its marketing objectives Marketing strategy development Designing an initial marketing strategy for a new product based on the product concept Needs States of felt deprivation New product A good, service or idea that is perceived by some potential customers as new New-product development The development of original products, product improvements, product modifications and new brands through the firm’s own R&D efforts New-task situation A business buying situation in which the buyer purchases a product or service for the first time Objective-and-task method Developing the promotion budget by (1) defining specific objectives, (2) determining the tasks that must be performed to achieve these objectives, and (3) estimating the costs of performing these tasks The sum of these costs is the proposed promotion budget Observational research The gathering of primary data by observing relevant people, actions and situations Occasion segmentation Dividing the market into groups according to occasions when buyers get the idea to buy, actually make their purchase or use the purchased item Off-price retailer Retailer that buys at less than regular wholesale prices and sells at less than retail Examples are factory outlets, independents and warehouse clubs Marketing supply chain management See Supply chain management Online advertising Advertising that appears while consumers are surfing the Web, including banners, interstitials, pop-ups and other forms Marketing website A website that engages consumers in interactions that will move them closer to a direct purchase or other marketing outcome Online databases Computerised collections of information available from online commercial sources or via the Internet Maturity stage The stage in the product life cycle in which sales growth slows or levels off Online (Internet) marketing research Collecting primary data through Internet surveys and online focus groups Merchant wholesaler Independently owned business that takes title to the merchandise it handles Open trading exchanges Huge e-marketspaces in which B2B buyers and sellers find each other online, share information and complete transactions efficiently An ‘eBay’ for the commercial world Microenvironment The actors close to the company that affect its ability to serve its customers – the company, Z04_ARMS7518_03_SE_GLOS.indd 607 02/07/15 8:59 pm www.downloadslide.net 608 GLOSSARY Opinion leader Person within a reference group who, because of special skills, knowledge, personality or other characteristics, exerts influence on others Product Anything that can be offered to a market for attention, acquisition, use or consumption that might satisfy a want or need Optional-product pricing The pricing of optional or accessory products along with a main product Product adaptation Adapting a product to meet local conditions or wants in foreign markets Outside sales force (or field sales force) Outside salespeople who travel to call on customers in the field Product bundle pricing Combining several products and offering the bundle at a reduced price Packaging The activities of designing and producing the container or wrapper for a product Product concept A detailed version of the new-product idea stated in meaningful consumer terms Part of the new-product development process Partner relationship management Working closely with partners in other company departments and outside the company jointly to bring greater value to customers Percentage-of-sales method Setting the promotion budget at a certain percentage of current or forecasted sales or as a percentage of the unit sales price Perception The process by which people select, organise and interpret information to form a meaningful picture of the world Personal selling Personal presentation by the firm’s sales force for the purpose of making sales and building customer relationships Personality The unique psychological characteristics that lead to relatively consistent and lasting responses to one’s own environment Pleasing products Products that give high immediate satisfaction but may hurt consumers in the long run Political environment Laws, government agencies and pressure groups that influence and limit various organisations and individuals in a given society Portfolio analysis The process by which management evaluates the products and businesses making up the company Positioning statement A statement that summarises company or brand positioning – it takes this form: To (target segment and need) our (brand) is (concept) that (point of difference) Pre-approach The step in the selling process in which the salesperson learns as much as possible about a prospective customer before making a sales call Presentation The step in the selling process in which the salesperson tells the product ‘story’ to the buyer, highlighting customer benefits Price The amount of money charged for a product or service, or the sum of all the values that customers give up in order to gain the benefits of having or using a product or service Price elasticity A measure of the sensitivity of demand to changes in price Primary data Information collected for the specific purpose at hand Private brand (or store brand) A brand created and owned by a reseller of a product or service Private trading exchanges B2B trading networks that link a particular seller with its own trading partners Z04_ARMS7518_03_SE_GLOS.indd 608 Product development (1) A strategy for company growth by offering modified or new products to current market segments Product development (2) Developing the product concept into a physical product in order to ensure that the product idea can be turned into a workable product Product life cycle The course of a product’s sales and profits over its lifetime It involves five distinct stages: product development, introduction, growth, maturity and decline Product line A group of products that are closely related because they function in a similar manner, are sold to the same customer groups, are marketed through the same types of outlets or fall within given price ranges Product line pricing Setting the price steps between various products in a product line based on cost differences between the products, customer evaluations of different features and competitors’ prices Product–market expansion grid A portfolio planning tool for identifying company growth opportunities through market penetration, market development, product development or diversification Product mix (or product portfolio) The set of all product lines and items that a particular seller offers for sale Product quality The ability of a product to perform its functions; it includes the product’s overall durability, reliability, precision, ease of operation and repair, and other valued attributes Product sales force structure A sales force organisation under which salespeople specialise in selling only a portion of the company’s products or lines Product’s position The way the product is defined by consumers on important attributes – the place the product occupies in consumers’ minds relative to competing products Production concept The idea that consumers will favour products that are available and highly affordable and that the organisation should therefore focus on improving production and distribution efficiency – ‘we will sell what we can make’ Promotion mix (or marketing communications mix) The specific mix of advertising, personal selling, sales promotion, public relations and direct marketing that a company uses to communicate customer value persuasively and build customer relationships 02/07/15 8:59 pm www.downloadslide.net 609 GLOSSARY Promotional pricing Temporarily pricing products below the list price, and sometimes even below cost, to increase shortterm sales Prospecting The step in the selling process in which the salesperson identifies qualified potential customers Psychographic segmentation Dividing a market into different groups based on social class, lifestyle or personality characteristics Psychological pricing A pricing approach that considers the psychology of prices and not simply the economics; the price is used to say something about the product Sample A segment of the population selected for marketing research to represent the population as a whole Secondary data Information that already exists somewhere, having been collected for another purpose Segmented pricing Selling a product or service at two or more prices, where the difference in prices is not based on differences in costs Selective distribution The use of more than one, but fewer than all, of the intermediaries who are willing to carry the company’s products Public Any group that has an actual or potential interest in, or impact on, an organisation’s ability to achieve its objectives Selling concept The idea that consumers will not buy enough of the firm’s products unless it undertakes a large-scale selling and promotion effort Public relations Building good relations with the company’s various publics by obtaining favourable publicity, building up a good ‘corporate image’, and handling or heading off unfavourable rumours, stories and events Selling process The steps that the salesperson follows when selling, which include prospecting and qualifying, pre-approach, approach, presentation and demonstration, handling objections, closing and follow-up Pull strategy A promotion strategy that calls for spending a lot on advertising and consumer promotion to build up consumer demand that will pull the product through channels Sense-of-mission marketing A principle of enlightened marketing that holds that a company should define its mission in broad social terms rather than narrow product terms Push strategy A promotion strategy that calls for using the sales force and trade promotion to push the product through channels Sequential product development A new-product development approach in which one company department works to complete its stage of the process before passing the new product along to the next department and stage Reference prices Prices that buyers carry in their minds and refer to when they look at a given product Relationship marketing Often defined in opposition to transactional marketing (see below), in that relationship marketing espouses long-term ‘management of customers’ rather than on a transaction-by-transaction basis A term often misused to describe loyalty cards Retailer Business whose sales come primarily from retailing Retailing All activities involved in selling goods or services directly to final consumers for their personal, non-business use Return on marketing (or marketing ROI) The net return from a marketing investment divided by the costs of the marketing investment Often difficult to measure with any degree of accuracy Sales force management The analysis, planning, implementation and control of sales force activities It includes designing sales force strategy and structure, and recruiting, selecting, training, supervising, compensating and evaluating the firm’s salespeople Sales promotion Short-term incentives to encourage the purchase or sale of a product or service Sales quota A standard that states the amount a salesperson should sell and how sales should be divided among the company’s products Salesperson An individual acting for a company by performing one or more of the following activities: prospecting, communicating, servicing and information gathering Salutary products Products that have low appeal but may benefit consumers in the long term Z04_ARMS7518_03_SE_GLOS.indd 609 Service Any activity or benefit that one party can offer to another that is essentially intangible and does not result in the ownership of anything Service inseparability A major characteristic of services – they are produced and consumed at the same time and cannot be separated from their providers, whether the providers are people or machines Service intangibility A major characteristic of services – they cannot be seen, tasted, felt, heard or smelled before they are bought Service perishability A major characteristic of services – they cannot be stored for later sale or use Service–profit chain The chain that links service firm profits with employee and customer satisfaction Service variability A major characteristic of services – their quality may vary greatly, depending on who provides them and when, where and how Share of customer The portion of the customer’s purchasing that a company gets in its product categories Shopping centre A group of retail businesses planned, developed, owned and managed as a unit Also commonly known as a shopping mall Shopping product Consumer good that the customer, in the process of selection and purchase, characteristically compares on such bases as suitability, quality, price and style Simultaneous (or team-based) product development An approach to developing new products in which various company departments work closely together, 02/07/15 8:59 pm www.downloadslide.net 610 GLOSSARY overlapping the steps in the product development process to save time and increase effectiveness Single-source data systems Electronic monitoring systems that link consumers’ exposure to television advertising and promotion (measured using television meters) with what they buy in stores (measured using store checkout scanners) Social class Relatively permanent and ordered divisions in a society, the members of which share similar values, interests and behaviours Social marketing The design, implementation and control of programmes seeking to increase the acceptability of a social idea, cause or practice among a target group Societal marketing A principle of enlightened marketing that holds that a company should make good marketing decisions by considering consumers’ wants, the company’s requirements, consumers’ long-term interests and society’s long-term interests Survey research The gathering of primary data by asking people questions about their knowledge, attitudes, preferences and buying behaviour Sustainable marketing This is an approach to marketing that focuses on the long-term viability of marketing strategies and their effects on wider social and ecological systems within which business enterprises are embedded SWOT analysis An overall evaluation of the company’s strengths (S), weaknesses (W), opportunities (O) and threats (T) A part of the preparation required in drawing up a marketing plan Systems selling Buying a packaged solution to a problem from a single seller, thus avoiding all the separate decisions involved in a complex buying situation Target costing Pricing that starts with an ideal selling price, then targets costs that will ensure that the price is met Spam Unsolicited, unwanted commercial email messages Target market A set of buyers sharing common needs or characteristics that the company decides to serve Speciality product Consumer product with unique characteristics or brand identification for which a significant group of buyers is willing to make a special purchase effort Target marketing The process of evaluating each market segment’s attractiveness and selecting one or more segments to enter Speciality store A retail store that carries a narrow product line with a deep assortment within that line Target profit pricing See Break-even pricing Standardised marketing mix An international marketing strategy for using basically the same product, advertising, distribution channels and other elements of the marketing mix in all the company’s international markets Straight product extension Marketing a product in a foreign market without any change Straight rebuy A business buying situation in which the buyer routinely reorders something without any modifications Strategic planning The process of developing and maintaining a strategic fit between the organisation’s goals and capabilities and its changing marketing opportunities It involves defining a clear company mission, setting supporting objectives, designing a sound business portfolio and coordinating functional strategies Style A basic and distinctive mode of expression Subculture A group of people with shared value systems based on common life experiences and situations Supermarket Large, low-cost, low-margin, high-volume, selfservice store that carries a wide variety of food, laundry and household products Superstore A store much larger than a regular supermarket that carries a large assortment of routinely purchased food and non-food items and offers services such as dry cleaning, post office, photo finishing, cheque cashing, bill paying, café, car care and pet care Supply chain management Managing upstream and downstream value-added flows of materials, final goods and related information among suppliers, the company, resellers and final consumers Z04_ARMS7518_03_SE_GLOS.indd 610 Team selling Using teams of people from sales, marketing, engineering, finance, technical support, and even upper management, to service large, complex accounts Technological environment Forces that create new technologies, creating new product and market opportunities Telephone marketing Using the telephone to sell directly to customers Territorial sales force structure A sales force organisation that assigns each salesperson to an exclusive geographical territory in which that salesperson sells the company’s full line Test marketing The stage of new-product development in which the product and marketing programme are tested in more realistic market settings Third-party logistics (3PL) provider An independent logistics provider that performs any or all of the functions required to get its client’s product to market Total costs The sum of the fixed and variable costs for any given level of production Undifferentiated (mass) marketing A market coverage strategy in which a firm decides to ignore market segment differences and go after the whole market with one offer Unsought product Consumer product that the consumer either does not know about or knows about but does not normally think of buying Value-added pricing Attaching value-added features and services to differentiate a marketing offer and support higher prices, rather than cutting prices to match competitors Value analysis An approach to cost reduction in which components are studied carefully to determine if they can be 02/07/15 8:59 pm www.downloadslide.net GLOSSARY redesigned, standardised or made by less costly methods of production Value-based pricing Setting price based on buyers’ perceptions of value rather than on the seller’s cost Value chain The series of departments that carry out valuecreating activities to design, produce, market, deliver and support a firm’s products Value-delivery network The network made up of the company, suppliers, distributors and ultimately customers who ‘partner’ with each other to improve the performance of the entire system Value proposition The full positioning of a brand – the full mix of benefits upon which it is positioned Variable costs Costs that vary directly with the level of production Vertical marketing system (VMS) A distribution channel structure in which producers, wholesalers and retailers act as a unified system One channel member owns the others, has contracts with them or has so much power that they all cooperate (See Horizontal marketing system.) Viral marketing The Internet version of word-of-mouth Z04_ARMS7518_03_SE_GLOS.indd 611 611 marketing – websites, email messages or other marketing events that are so infectious that customers will want to pass them along to friends Wants The form needs take as shaped by culture and individual personality (See Needs.) Web communities Websites upon which members can congregate online and exchange views on issues of common interest Wheel-of-retailing concept A concept of retailing that states that new types of retailers usually begin as low-margin, low-price, low-status operations but later evolve into higherpriced, higher-service operations, eventually becoming like the conventional retailers they replaced Whole-channel view Designing international channels that take into account all the necessary links in distributing the seller’s products to final buyers, including the seller’s headquarters organisation, channels among nations and channels within nations Wholesaler A firm engaged primarily in wholesaling activity Wholesaling All activities involved in selling goods and services to those buying for resale or business use 02/07/15 8:59 pm www.downloadslide.net INDEX acquisitions 555 actual products 234 adapted marketing mix 528–35 added value 337–8 administered VMSs 342–3 adoption process for new products 168–70 advertising 11, 396, 399–400, 402–21 accountability 419 agencies 420 budget decisions 405, 406–8 and children 156, 213 in computer games 416–18 costs 547 evaluation 405 expenditure on 402–5 and integrated marketing communications 397–8, 399 international 170–1, 420–1 jobs in 595–6 media decisions 405, 414–19 message decisions 405, 408–14 narrowcasting 410–12 objectives setting 405–6 online 491–3 organising for 419–20 promotional products 423 social marketing 237 subliminal 162 tobacco 544–6 top UK advertisers 403 affiliate programmes 493 affordable method of advertising 407 age ageing population 153, 166–7 and consumer market segmentation 194–5 and life-cycle stage 157 and online consumers 481–2 agents advertising agencies 420 wholesalers 384, 385–6 Air France-KLM 115–18 Airbus A380 147, 148–50 Aldi 91, 366–7 alliances and online marketing 493 allowance pricing 317, 318 alternative evaluation 166 Amazon 23, 45, 140, 215, 250, 312, 480 American Express 139–40, 195–6, 203 American Marketing Association Z05_ARMS7518_03_SE_IDX.indd 612 ethical norms and values for marketers 569–70 analytic ratios 590–2 Angry Birds 497 Apple 27, 95–6, 498 apps 494–7 Arla Foods 75, 76–7 Armorica Cookware 463 Asda 194 Asian retail sector 378–9 Asian subcultures 152 attitudes and consumer buyer behaviour 162–3 augmented products 234 Aviva 248–9 B2B (business to business) marketing 174, 180–1, 402, 480, 482–4 B2C (business to consumer) 480, 481–2 baby boomers 82, 83 Baltika 189, 190–1 barnacles 27 behavioural segmentation 199–202 beliefs and consumer buyer behaviour 162–3 Ben & Jerry’s 564–5 benefit segmentation 200–1 Blair, Tony 152 blogs 484–5, 494 Bosch 63, 64 Boston Consulting Group (BCG) 49–50 brand management 596 branding 241, 245–56 brand development 247, 252–4 brand equity 245–6 brand extensions 253, 254 brand life cycles 285 brand name selection 247–50 brand personality 159 brand positioning 216–22, 247 image differentiation 216 positioning statements 222 value propositions 217–21 brand sponsorship 247, 250–2 managing brands 254–6 break-even pricing 305–6 brokers 384, 385 BT 41, 42–3 business analysis and new-product development 278 business buyer behaviour 171–81 business buying process participants 176–7 stages of 178–80 and business markets 171–4 buyer responses 175 buying organisations 175 decision-making 174 e-procurement 180–1 and the environment 175 influences on business buyers 177–8 purchasing functions 174 types of buying situations 175–6 business legislation 99–100 business markets 80, 171–4 characteristics of 171 GE 172–4 segmentation 202–3 structure and demand 171–2 business portfolio design 48–51 business products 236–7 business promotions 421, 424–5 businesses marketing’s impact on other businesses 555–6 butterflies 27 buyer decision process 163–70 evaluation of alternatives 165 information search 164 need recognition 164 for new products 168–70 post-purchase behaviour 165–8 purchase decision 165 buyers 13 benefits of digital marketing to 479–80, 480 and the four Cs 58 rights of 557 buying behaviour 146–85 Airbus A380 147, 148–50 see also business buyer behaviour; consumer buyer behaviour buying centres 176–7 buzz marketing 155, 427 by-product pricing 315, 316 C2B (consumer to business) marketing 480, 486 C2C (consumer to consumer) marketing 480, 484–6 Cadbury 19 CAFTA (Central American Free Trade Agreement) 518 capital items 236 02/07/15 9:00 pm www.downloadslide.net INDEX captive-product pricing 315, 316 careers in marketing 594–600 Carrefour 52, 53, 120, 381 cash cows 49–50 cash refunds (rebates) 423 catalogue marketing 458, 460–1 category killers 370 CATI (computer-assisted telephone interviewing) 128 CATS (completely automated telephone surveys) 128 causal research 121 cause-related marketing 101 TOMS shoes 84–5 CFOs (chief financial officers) 66 chain stores 371–2 channel conflict 340–1 channel differentiation 215 channel levels 339 checkout scanners 130 chief financial officers (CFOs) 66 chief marketing officers (CMOs) 64 children child obesity 549, 550–1 and consumer buyer behaviour 156 and materialism 553 privacy and safety online 502 and target marketing 213 China demographic environment 81–2 economic environment 519 global marketing in 521, 524–3, 530–1 Volkswagen 512–14 pollution 92 citizen-action publics 80 click-and-mortar companies 487–8 click-only companies 487 Cloon Keen Atelier 254, 255–6 club marketing programmes 21 CMOs (chief marketing officers) 64 co-branding 251–2 Co-operative Bank 30 Coca-Cola 80, 420, 421, 521, 536 cocooning 102–3 cognitive dissonance 165 commercialisation and new-product development 279–80 communication 58 adaptation for global marketing 533 companies global firms 515 and the microenvironment 78–9 and product costs 304–6 responding to price changes 327–8 company positioning 216–22 image differentiation 216 positioning statements 222 value propositions 217–21 comparative advertising 406, 420 competitive advantage positioning for 214–22 competitive-parity method of advertising 407 competitors managing marketing strategy 55 Z05_ARMS7518_03_SE_IDX.indd 613 and marketing intelligence 119–20 in the marketing system 14 and the microenvironment 80 and price changes 325, 326–7 strategies and prices 312–13 and target marketing 212 complaintvertising 94–5 completely automated telephone surveys (CATS) 128 computer games advertising in 416–18 computer-assisted telephone interviewing (CATI) 128 concentrated (niche) marketing 56, 209–10 concept development and testing 275–7 congestion charges 554 consumer associations and product safety 551 consumer buyer behaviour 150–71 across international borders 170–1 buyer decision process 163–71 characteristics affecting 151–63 models of 150–1 and type of consumer product 235 consumer market segmentation 192–207 behavioural 199–202 demographic 194–9 geographical 192–4 men’s clothing 196–9 multivariable 202 consumer markets 80, 150 consumer products 234 consumer promotions 421, 422–4 consumer-oriented marketing 563 consumerism 556–7 consumers 13 changing patterns of spending 89, 91–2 marketing’s impact on individual consumers 547–53 contact methods of data collection 126–30 content sponsorships 493 contract manufacturing 527 contractual VMSs 342 convenience 58 products 234, 235 stores 368, 369 conventional distribution channels 341 core benefit of products and services 233–4 core cultural values 102 corporate image advertising 236 corporate marketing ethics policies 566–70 corporate VMSs 341–2 corporate websites 489 cost-based pricing 302, 305–6 coupons 423 credit crunch 83, 89, 553 CRM (customer relationship management) 11, 13, 20–7, 33 building customer equity 26–7 capturing value from customers 11, 13, 25–7, 33 changing nature of 22–4 customer perceived value 20–1 613 customer satisfaction 13, 21, 34 Danfoss 61–3 direct marketing 23–4 managing marketing relationships 20–1 and marketing information 132–3 retaining customers for the long term 23 share of customer 26 software 132, 133 cultural environment 101–4 in consumer behaviour 151–4 across international borders 170–1 cultural shifts 152 and digital marketing 499 and global marketing 520–1, 525, 529–30 international market segmentation 206 cultural pollution 554–5 customer cost 58 customer databases 456–8 customer equity 246 customer lifetime value 26 customer management 15 organisations 64 customer markets 80 customer perceived value 20–1 customer relationships building 20–5 levels and tools 21 creating customer loyalty and retention 25 and marketing plans 577 and partner relationship management 24–5, 52–3 and personal selling 448, 451–2 and sales promotion 422 see also CRM (customer relationship management) customer sales force structure 441–2 customer satisfaction 21, 33, 134 and buyer decision process 166–8 customer service 369 customer solution 58 customer teams, cross-functional 24 customer value marketing 564 customer-driven marketing strategies 11–19, 33, 55–7 choosing a value proposition 15 marketing management orientations 15–17 selecting customers to serve 14–15 customers customer value-delivery networks 347–8 customer-segment pricing 318 needs, wants and demands 10, 11, 12, 33 perceptions of value 301–4 and price changes 325–6 selecting customers to serve 14–15 customisation 499 Danfoss 61–3 Danone 56 data mining 132 data warehouses 132 database marketing 456–8, 464–5 deceptive practices 548 02/07/15 9:00 pm www.downloadslide.net 614 INDEX delight creating customer delight 21, 25, 33, 34, 166 Dell 10, 23, 25, 113, 348–9 demand chains 336 demand curve 311 demand management 15 demarketing 15 demographic environment 81–8 and global marketing 525 demographic segmentation 194–9 department stores 368, 369 descriptive research 121 desirable products 566 DFE (design for environment) practices 561 differentiated (segmented) marketing 208–9 digital divide 504 digital marketing 28–9, 180–1, 472–508 apps 494–7 benefits of to buyers 479–80 to sellers 480 blogs 484–5, 494 data 123, 124 and direct marketing 452–3 privacy issues 464–5 web–based catalogues 460–1 e-business 478–9 and global price differences 535 internet statistics 477–8 legal and ethical issues 502–4 new intermediaries 498–9 online marketing research 128–9 Oxford Internet Survey 483 product failures 272 3D printing 474–6 web marketing 486–94 see also e-commerce; e-marketing; social media direct investment and global marketing 525, 527–8 direct mail marketing 458, 459–60 direct marketing 23–4, 396, 399, 401, 435, 452–67 benefits and growth of 456 channels 339, 452 and customer databases 456–8 forms of 458–61 Groupon 453–5, 460 integrated 462–3 new model of 452–3 public policy and ethical issues in 464–5 direct-response television marketing 458, 461 disadvantaged consumers poor service to 552 discount stores 370 discounts 317–18 disintermediation 344–7 distinctive competencies 45 distribution centres 354 distribution channels see marketing channels distribution costs 547 Z05_ARMS7518_03_SE_IDX.indd 614 distributors and channel transactions 337–8 and new-product development 273 diversification 51 dogs in the growth-share matrix 49–50 Doro 166, 167 downsizing strategies 51 dumping 534 Dunhill 230–2 dynamic pricing 317, 323–4 e-business 478–9 e-commerce 479, 481–6 B2B (business to business) 480, 482–4 B2C (business to consumer) 480, 481–2 C2B (consumer to business) 480, 486 C2C (consumer to consumer) 480, 484–6 e-marketing 479, 486–98 C2B (consumer to business) 486 click-and-mortar companies 487–8 click-only companies 487 creating a website 489–91 placing ads and promotions online 491–4 web sellers 442 e-procurement 180–1 Eastern Europe migrants from 86 eBay 44, 45, 484 economic communities 517–18 economic environment 89–92 and global marketing 518–19, 525, 534 economic factors and consumer buyer behaviour 157 in distribution channel design 349 in pricing 313 segmenting international markets 203 EDLP (everyday low pricing) 375 educated people, rise in numbers of 87 Electrolux 281–3 email 498 Engel’s laws 92 environmentalism 557–62 Ericson 25 ESOMAR 137–9 Estée Lauder 208, 209 ethical issues 543–74 direct marketing 464–5 ethical responsibility 29–30, 33, 34, 100–2 marketing ethics 566–70 in marketing research 137–40 online 503 smoking 544–6 social criticisms of marketing 546–6 sustainability 557–62 see also social responsibility ethnic diversity 87 and consumer buyer behaviour 152–3 ethnographic research 125 European Council for Small Businesses and Entrepreneurship 135 European retailing leaders in 377–9 European Small Business Alliance 135 European Union (EU) 97–9 and the ageing population 166–7 business legislation 99–100 consumer market 150 creation 97–8 and cultural values 103–4 demographic levels 87 demographic trends 82 economic trends 89, 90, 91 and environmentalism 562 and global marketing 517–18 incomes 89 objectives 98–9 policy issues in pricing 328 services marketing 256–7 technology 96, 97 excessive mark-ups 547–8 exchange controls 516 exchanges 13 exclusive distribution 349 Exostar 180 Expedia 23, 503–4 experiential retailing 374 experimental research 126, 135 exploratory research 121 exporting 525, 526, 536 extranets 134 Facebook 79, 95, 100–1, 128 and marketing research 138 and online privacy 503 factory outlets 371 families changing household structures 86 and consumer buyer behaviour 155–6 FEDMA (Federation of Direct and Interactive Marketing Associations) 465 field sales forces 442 financial intermediaries 79 financial publics 80 Fisher-Price 125 fixed costs 305 focus group interviewing 127–8, 137 food-related lifestyle segments 158 four Cs of marketing 58 four Ps of marketing 19, 33, 57–8 France and globalisation 521–2 retailing 377 franchise organisations 342, 372 frequency marketing programmes 21 Freud, Sigmund 160 Gates, Bill 120 GATT (General Agreement on Tariffs and Trade) 516–17 gay and lesbian customers 87–9 GDP (gross domestic product) 89, 90 GE building B2B customer partnerships 172–4 gender and changing family structures 155–6 and the labour market 86, 87 02/07/15 9:00 pm www.downloadslide.net INDEX and online consumers 481 segmentation 195 general public 81 Generation X 83–4 Generation Y (Millennials) 82, 84, 86 generational marketing 86 geodemographic segmentation consumer markets 202 international markets 203 geographical environment and global marketing 525 population shifts 86–7 geographical pricing 317, 322–3 geographical segmentation 192–4 Germany retailing 377–8 Girl Guides 44–5 global marketing 510–41 careers in 595 deciding whether to go international 524 direct investment 525, 527–8 distribution channels 535–6 environment 516–23 cultural 520–3, 525, 529–30 economic 518–19, 525, 534 international trade system 516–18 exporting 525, 526, 536 and global organisations 537 grey markets 536 joint venturing 525, 526–7 major global marketing decisions 516 and the marketing mix 528–35 marketing objectives and policies 524–5 organisation of 536–7 in the twenty-first century 514–15 globalisation 29 and international product and services marketing 262–3 GM (General Motors) 56 goals and strategic planning 44, 46–7 good value pricing 303 Google 120, 139, 269, 270–1, 421 government influences on pricing 313 government intervention in natural resource management 92 government markets 80 government publics 80 government statistics 122–3 The Greenery 382–3 greenwashing 93 grey markets 536 Groupon 453–5, 460 groups group interviewing 127 small groups and consumer buyer behaviour 154–5 growth strategies 50–1 growth-share matrix 49–50 harmful products 549 Harrods 195 high-pressure selling 549 HMV 485 Z05_ARMS7518_03_SE_IDX.indd 615 horizontal marketing systems 343 households changes in size and composition 86 HR managers and social media 139 IBM 441–2, 443 ideas generation 273–5 marketing 12, 237 screening 285 IKEA 10, 194, 314 IMC see integrated marketing communications (IMC) incomes changes in 89–90 income distribution and global marketing 519 income segmentation 195–6 independent off-price retailers 370 indirect marketing channels 339 individual consumers marketing’s impact on 547–53 individual factors influences on business buyers 177, 178 individual interviewing 127 individual marketing 210–12 industrial economies 89, 519 industrial products 235–6 industrialising economies 519 industry data 123 information market offerings 12 searches, and the buyer decision process 164 see also marketing information information technology see technology informative advertising 405–6 ING Direct 22–3 innovation management and new-product development 281 innovative marketing 564 innovativeness individual differences in 169 inside sales forces 442–3 Instagram 100–1 integrated direct marketing 462–3 integrated logistics management 357–9 integrated marketing communications (IMC) 397–9, 427 and direct marketing 452–3 and online advertising 494 and promotion mix concepts 402 shifting model of 397–8 intensive distribution 349 interactive marketing 259–60 intermarket segmentation 206 intermediaries and digital marketing 498–9 in distribution channels 348–9, 350–1 and global marketing 535–6 intermodal transportation 356 internal databases 114–19 internal marketing 259 615 internal publics 81 international advertising 420–1 international borders consumer buyer behaviour across 170–1 International Chamber of Commerce International Code of Marketing and Social Research Practice 139 international distribution channels 350 international marketing research 135–7 international markets 80 product and services marketing 262–3 segmentation 203–6 international pricing 317, 324–5 international subsidiaries 537 internet see digital marketing; social media interpersonal factors influences on business buyers 177, 178 interviewing and data collection 127, 137 intranets 134, 476–7 inventory management 354–6 vendor-managed 180 Invotek Solutions 239–40 joint ownership and global marketing 527 joint venturing 525, 526–7 kiosk marketing 458, 461 labelling 242 learning and consumer buyer behaviour 162 legal factors in international market segmentation 206 legislation regulating business 99–100 lesbian and gay customers 87–9 less-for-much-less positioning 219 Ryanair 219–21 licensing brands 251 and global marketing 526 Lidl 14, 91 life-cycle stage and consumer market segmentation 194–5 lifestyle segmentation 158–9, 196–9 line extensions 252–3 lobbying 104, 425 local marketing 210 and global markets 528–32 local publics 81 location pricing 318 logistics 352–9 information management 356–7 integrated logistics management 357–9 jobs in 598 physical distribution firms 79 LOHAS market 103 L’Oréal 53–4, 529 loyalty creating customer loyalty and retention 25 and customer profitability 26–7 and market segmentation 201–2 loyalty cards 133 02/07/15 9:00 pm www.downloadslide.net 616 INDEX McDonald’s 53, 93 and global marketing 521, 522–3, 528–9 Maersk Line 47–8 mail questionnaires 127 management managing the marketing effort 59–65 orientations in marketing 15–17 management contracting 527 managers on marketing 17–18 manufacturing contract manufacturing 527 mark-downs 593 mark-ups 592–3 excessive 547–8 market demand and pricing 310–12 market development 51 market intelligence agencies 123 market management organisations 64 market offerings 12–13, 232–3 market penetration 51 market positioning 56–7, 192, 214–22 choosing a positioning strategy 215–22 communicating and developing the chosen position 222 positioning maps 214–15 retailing 373 wholesalers 384 market segmentation 15, 33, 55, 56, 192–207 Baltika 189, 190–1 business market segmentation 202–3 international markets 203–6 lifestyle segmentation 158–9 requirements for effective 206 see also consumer market segmentation; target marketing market variability and target marketing 212 market-penetration pricing 314 market-skimming pricing 314 marketing defining 10–11 model of the marketing process 11, 33 marketing analysis 55, 59–60 marketing audits 65 marketing channels 332–61 and added value 337–8 behaviour and organisation 339–47 design decisions 347–50 global marketing 535–6 logistics and supply chain management 352–9 management decisions 350–1 number of channel levels 338–9 Pinturas Fierro 333, 334–6 public policy and distribution decisions 352 wholesalers 383–4 marketing concept 16–17, 546 marketing control 55, 59, 64–5 marketing dashboards 66 marketing departments organisation of 64 marketing environment 74–107 Z05_ARMS7518_03_SE_IDX.indd 616 Arla Foods 75, 76–7 as the context of business 78 macroenvironment 78, 81–104 microenvironment 78–81 responses to the 104 marketing ethics 566–70 marketing implementation 55, 59, 61–3 marketing information 108–45 analysing 131–3 assessing needs 113–14 costs 114 developing 114–20 distributing and using 133–4 marketing intelligence 119–20 system (MIS) 112–13, 133–4, 141 VisitScotland 110–12 see also marketing research marketing intelligence 119–20 marketing intermediaries 14 managing marketing strategy 55 and the microenvironment 79–80 marketing management defining 14 orientations 15–17 personal selling 440–8 marketing mix and consumer buyer behaviour 150–1 the four Cs 58 the four Ps 19, 33, 55, 57–8 and the product life-cycle 287 promotion/marketing communications mix 396 retailing 373–6 standardised and adapted for global markets 528–35 wholesaler marketing decisions 384–7 marketing myopia 12 marketing planning 11, 19, 33, 55, 59, 60–1 marketing plans 576–86 and customer relationships 577 role of research in 576 sample for Sonic 577–86 marketing research 120–31 defining the problem and research objectives 121 developing the research plan 121–2 implementing the research plan 131 international 135–7 interpreting and reporting findings 131 jobs in 598 primary data collection 122–31 public policy and ethics in 137–40 secondary data 122–4, 135 in small businesses and non-profit organisations 134–5 marketing ROI 65–6 marketing services agencies 79 marketing strategy 44, 55–9 development 277 impact of culture on 520–1 sample plan for Sonic 583–4 see also customer-driven marketing strategies marketing websites 489–90 markets, concept of 13–14 Marks & Spencer 14 Marks & Spencerm and Oxfam Clothes Exchange 558–61 Maslow, Abraham on motivation 160 mass customisation 211–12 mass (undifferentiated) marketing 208 materialism 553–4 materials and parts industrial products 236–7 maturity stage of the product life-cycle 286–7 mechanical devices in data collection 130–1 media intermediaries 79 and marketing research 122 media decisions in advertising 405, 414–19 publics 80 men’s clothing, segmentation in 196–9 merchandising conglomerates 372 merchant wholesalers 384, 385 MERCOSUR 518 metaphors in marketing 31–2 micromarketing 210–12 Miele 303–4 migration 86–7 Millennials (Generation Y) 82, 84, 86 MIS (marketing information system) 112–13, 133–4, 141 mission statements 44–6 misuse of research findings 140 mobile marketing 427 modified rebuy 175 monopolistic competition 310 Monsanto 46–7 more-for-less positioning 219 more-for-more positioning 217–18 more-for-the-same positioning 218 Mosaic consumer classification system 202, 204–5 motivation consumer buyer behaviour 159–60 and mission statements 45–6 salespeople 446–7 multibrands 253 multichannel distribution systems 343–4 narrowcasting 410–12 natural environment 92–4 nature, people’s views of 103 needs 12 customers 10, 11, 12, 33 core customer needs 234 general needs description, in the business buying process 178–9 and motivation 160–1 need recognition 163, 164 new brands 253–4 new marketing landscape 28–30 new products buyer decision process for 168–70 02/07/15 9:00 pm www.downloadslide.net INDEX development strategy 271–83 Electrolux 281–3 Google 269, 270–1 new-product planning 598 pricing strategies 314 new-task situations 175 niche marketing 56, 209–10 non-probability samples 129 non-profit organisations 134–5, 599 non-store retailing 367, 379–80 not-for-profit marketing 10, 28, 30 obesity debate 549–51 objective-and-task method of advertising 407–8 objectives of marketing research 121 and strategic planning 44, 46–7 observational research 125, 135 occupational groups and consumer buyer behaviour 157 off-price retailers 368, 370 oligopolistic competition 310 Oliver, Jamie 550–1 open trading exchanges 482–3 opinion leaders 155 optimal-product pricing 315 order-root specification in the business buying process 178, 179–80 organisation marketing 236 organisational approach factors influencing pricing 310 influences on business buyers 177–8 types of retail organisations 371–2 organisations market offerings 12 people’s views of 103 outside sales forces 442 Oxford Internet Survey 483 P&G 24, 25, 119, 534 packaging 241–2, 262–3 Packard, David 24 partner relationship management (PRM) 24–5, 52–3 and distribution channels 351 partnerships logistics 358 patronage rewards 423 people and the marketing mix 57 percentage-of-sales method of advertising 407 perception and consumer buyer behaviour 161–2 perceptual positioning maps 214–15 perfect competition 310 performance review 178, 180 permission-based marketing 498 person marketing 236–7 personal factors in consumer buyer behaviour 151, 157–9 personal interviewing 127 Z05_ARMS7518_03_SE_IDX.indd 617 personal selling 396, 399, 435, 438–52 customer value and company profit 440 nature of salespeople 438–9 process 448–51, 466 approach 449–50 closing 450 follow-up 450–1 handling objections 450 pre-approach 449 presentation and demonstration 450 prospecting and qualifying 449 role of salespeople 439–40 sales force management 440–8, 466 compensation plans 445 evaluation 448 recruitment and selection 443–5 size 442 strategy and structure 442–3 supervision and motivation 446–7 training 445 personality and consumer buyer behaviour 159 and market segmentation 199 persons market offerings 12 persuasive advertising 406 Philips 436–8 phishing 504 physical distribution see logistics physical evidence and the marketing mix 57 Pinterest 79, 100–1 Pinturas Fierro 333, 334–6 place 19, 57, 58 market offerings 12 place marketing 237 in retailing 375–6 in wholesaling 387 planned obsolescence 551–2 planning see strategic planning PLC (product life cycle) 212, 283–91 point-of-purchase (POP) promotions 423–4 political environment 97–101 and global marketing 525 and international market segmentation 206 political power 555 pollution 92–3 prevention 561 population age structure 82–6 portfolio analysis 48–9 post-purchase behaviour 165–6 pressure groups, data from 123 pricing 296–30 adjustment strategies 317–25 company and product costs 304–6 competitors’ strategies and prices 312–13 customer perceptions of value 301–4, 306 and global marketing 533–5 illegal price collusion 556 and market demand 310–12 and the marketing mix 19, 57, 58, 300–1, 306–7 mistakes in 301 617 new product pricing strategies 314 organisational considerations in 310 price changes 325–8 initiating 325–7 responding to 327–8 price elasticity 312 price packs 423 price transparency 498–9 Primark 298–300 product mix pricing strategies 315–17 public policy and 328 retail prices 368, 370–1, 374–5 Rolex 307–9 social criticisms of 547–8 structure 313–14 wholesalers 386 Primark 298–300 primary data 122 collecting 124–31 international marketing research 136–7 research instruments 129–31 sampling plans 129 privacy and direct marketing 464–5 intrusions of consumer privacy 137–40 online 502–4 private brands 250–1 private trading exchanges 484 proactive approach to the marketing environment 104 probability samples 129 problem recognition and the business buying process 178 process in the marketing mix 57, 58 product adaptation and global marketing 531, 532 product bundle pricing 315, 317 product line pricing 315 product management 596 organisations 64 product mix pricing strategies 315–17 product sales force structure 441 product-market expansion grid 50–1 production concept 15 products development 51, 283 differentiation 215 Dunhill 230–2 and global marketing 531–2 individual product decisions 237–43 branding 241 features 238–9 labelling 242 packaging 241–2 quality 238 style and design 239–40 support services 242–3 international marketing 262–3 levels of product and services 233–4 life cycle (PLC) 212, 283–91, 402 market offerings 12 in the marketing mix 19, 57, 58 the product concept 15 02/07/15 9:00 pm www.downloadslide.net 618 INDEX products (continued) product decisions and social responsibility 261–2 product line decisions 243–4 product mix decisions 244–5 product and service classifications 234–7 product stewardship 561 products, services and experiences 232–3 retailers and product lines/assortment 368, 369–70, 373 shoddy, harmful or unsafe 549, 551 societal marketing 565–6 specification 178, 179 variability, and target marketing 212 wholesalers 384–6 see also branding; new products profit and customer satisfaction 21 profit-and-loss accounts 588–90 promotion 19, 57–8, 397–9, 427 costs 547 and global marketing 532–3 online 493 promotion mix 396, 399–402 push and pull strategies 401–2 retailing 375 wholesalers 386–7 see also public relations; sales promotion promotional pricing 317, 321–2 proposal solicitation 178, 179 psychographic segmentation 196–9 psychological factors in consumer buyer behaviour 151, 159–63 psychological pricing 317, 319–21 public goods 554 public policy and marketing research 137–40 and pricing 328 public relations 396, 399, 400–1, 425–7 jobs in 598–9 publics managing marketing strategy 55 and the microenvironment 80–1 purchase decision 165 pure monopoly and market demand 311 Queer Eye for the Straight Guy 88 question marks 49 questionnaires 127, 129–30 in international marketing research 136–7 R & D (research and development) 78–9, 96–7 new-product development 278 raw materials shortages 92 raw-material-exporting economies 518–19 recruiting salespeople 443–5 Red Cross, International Committee of the 499–500 reference prices 319 regional free trade zones 517–18 Reiss 214–15 relationships in marketing see CRM (customer relationship management) Z05_ARMS7518_03_SE_IDX.indd 618 religion 103–4 and consumer buyer behaviour 152–3 reminder advertising 406 Renault 394–6 research approaches for primary data collection 124–6 resellers 79, 80 and pricing 313 retail convergence 380 retail parks 376 retailing 367–81 future of 376–81 jobs in 597–8 leaders in European retailing 377–9 marketing decisions 372–6 non-store retailing 367, 379–80 types of retailer 368–72 return on marketing (ROM) 65–6 revenue management 318 RFID (radio-frequency identification) transmitters 93, 355 Richer Sounds 12 roles and consumer buyer behaviour 156–7 Rolex 307–9 ROM (return on marketing) 65–6 Russia McDonald’s in 522–3 Ryanair 219–21 Saga 199 sales contests 424–5 sales force see personal selling sales management jobs 597 sales promotion 396, 399, 400, 421–5 evaluation 425 objectives 422 tools 422–5 same-for-less positioning 218 sampling plans 129 SBUs (strategic business units) 48–50 secondary cultural values 102 secondary data in marketing research 122–4, 135 security, online 502–4 segmented (differentiated) marketing 208–9 segmented pricing 317, 318–19 selective attention/distortion/retention 161 selective distribution 349 selective relationship management 22–3 self-actualisation needs 161, 162 self-marketing 21 self-realisation 102 sellers 13 benefits of digital marketing to 480 and global marketing 535–6 resellers 79, 80, 313 rights of 556–7 selling high-pressure 549 and marketing 11 selling concept 16 sense-of-mission marketing 564–5 sequential product development 280 service products 58 service-profit chain 259–60 services marketing 256–61 differentiation 215, 260 individual product and service decisions 237–43 inseparability 257, 258 intangibility 257–8 international 262–3 levels of product and services 233–4 market offerings 12 perishability 257, 258 product and service classifications 234–7 product support services 242–3 productivity 261 products, services and experiences 232–3 quality 260–1 retailing 368, 369, 373–4 strategies 258–61 variability 257, 258 wholesalers 384–6 share of customer 26 shopping centres/malls 374, 376 shopping products 235 Siemens 344 simultaneous product development 280–1 single-source data systems 126 situational factors and the purchase decision 165 small businesses marketing research in 134–5 small groups and consumer buyer behaviour 154–5 smoking 84, 86, 544–6 social class and consumer buyer behaviour 154 and income distribution 89–91 social costs of consumerism 554 social criticisms of marketing 546–56 social factors in consumer buyer behaviour 151, 154–7 in global marketing 525 in pricing 313 social marketing 237 campaigns 30 social media 478, 498, 499 and direct marketing 457–8 and e-commerce 486–7 and e-marketing 487 and marketing research 138–9 social and ethical issues 100–1 two-edged sword of 94–5 see also Facebook; Twitter social responsibility 29–30, 33, 34, 100–1 cause-related marketing 84–5, 101 consumerism 556–7 and product decisions 261–2 public actions to regulate marketing 562–3 sustainable marketing 563–6 target marketing 212–13 see also ethical issues societal marketing 17, 19, 565–7 society and digital marketing 499 02/07/15 9:00 pm www.downloadslide.net INDEX impact of marketing on 553–5 people’s views of 103 SOHO (Small Office/Home Office) market 87 Sonic sample marketing plan for 577–86 Sony 25 Spain retailing 378 spam 498 speciality products 235 speciality stores 368, 369 Stagecoach 92–3 standardised marketing mix 528 stars in the growth-share matrix 49–50 status and consumer buyer behaviour 156–7 Steam 345–6 store brands 250–1 straight product extension 531–2 straight rebuy 175 strangers 27 strategic alliances 25 strategic business units (SBUs) 48–50 strategic planning 42–54 company-wide 43–51 BT 41, 42–3 defining a market-oriented mission 44–6 designing the business portfolio 44, 48–51 setting company objectives and goals 44, 46–7 partnering with other company departments 52–3 partnering with others in the marketing system 53–4 see also marketing strategy subcultures and consumer buyer behaviour 152–3 subsistence economies 518 subliminal advertising 162 subsistence economies 89 supermarkets 368, 369 superstores 368, 370 suppliers in the business buying process 178, 179 and the company microenvironment 79 managing marketing strategy 55 in the marketing system 14 and new-product development 273 supplies and services 236 supply chain management 24–5, 352–9 integrated 357 supply chains 336 survey research 125–6, 135 Z05_ARMS7518_03_SE_IDX.indd 619 sustainability 557–62 vision 562 sustainable marketing 563–6 marketing ethics 566–70 sweepstakes 424 SWOT analysis 59–60, 581–2 systems selling 176 target costing 307 target marketing 15, 33, 56, 192, 207–13 evaluating market segments 207 retailing 373 selecting target market segments 207–12 socially responsible 212–13 wholesalers 384 target profit pricing 305–6 team selling 443 team-based product development 280–1 technology and careers in marketing 594 and disintermediation 344–7 disruptive 474 gender and technology purchases 156 and integrated marketing communications 397 intranets 134, 476–7 and lifestyle segmentation 158–9 and marketing information 112, 133–4 CRM software 132, 133 and Millennials 84 new environmental technologies 562 and the new marketing landscape 28–30 retail 380–1 the technological environment 93–7 see also digital marketing telecommuting 87 telemarketing 442, 458–9 telephone interviewing 127 television home shopping channels 461, 464 people meters 130 territorial sales force structure 440–1 Tesco 12, 114, 119, 457, 458 test marketing 279 third-party logistics 358 3D printing 474–6 TOMS shoes 84–5, 102 total costs 305 total quality management (TQM) 238 tourism and marketing information 110–12 TQM (total quality management) 238 trade and global marketing 514–15 international trade system 516–18 trade promotions 421, 424 transportation 355–6, 384 619 true friends 27 Twitter 79, 94–5, 128 UEFA 6–10, 20, 23 Under Armour 51 undifferentiated (mass) marketing 208, 212 United Kingdom retailing 378 top UK advertisers 403 United States government agency enforcement 100 Universe, people’s views of the 103–4 unsought products 235 usage rate, segmentation by 201 user status, segmentation by 201 VALs (Values and Lifestyles) 158 value added value 337–8 capturing value from customers 11, 13, 25–7, 33 creating value for customers 34 value analysis 179 value chains 52–3 value marketing 89 value propositions 15, 217–21 value-added pricing 303–4 value-based pricing 301–4 value-delivery network 336 value-delivery networks 53–4 values cultural values 101–4, 151–2 VALs (Values and Lifestyles) 158 variable costs 305 vendor-managed inventories 180 vertical marketing systems 341–3 video conferencing 28 viral marketing 493– Volkswagen 512–14 VW and Alfa Romeo 288–90 Wal-Mart 10, 300 Walton, Sam 10 wants of customers 12 warehousing 354, 383 Welch, Jack 53 wheel-of-retailing concept 379 wholesaling 381–7 channel functions 383–4 marketing decisions 384–7 trends in 387 types of wholesalers 384 world product groups 536–7 WTO (World Trade Organisation) 515, 516–17 Zara 358–9 02/07/15 9:00 pm www.downloadslide.net Z05_ARMS7518_03_SE_IDX.indd 620 02/07/15 9:00 pm ... concerning marketing channels What is the nature of marketing channels and why are they important? How channel firms interact and organise to the work of the channel? What problems companies face... every large company and many small ones distribute through multiple channels The Spanish banking organisation Grupo Santander is well established in both Europe and Latin America, and reaches customers... Ukrainian site) Multichannel distribution systems offer many advantages to companies facing large and complex markets With each new channel, the company expands its sales and market coverage and