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Marketing cc licensed ( BY NC SD ) flickr photo by TF28 ❘ tfaltings.de: http://flic.kr/p/8R1gEq

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Quiz • Closed book/closed notes • Put away phones until quiz is over • You may collaborate with your team • You are responsible for the answers on your quiz • You do not have to choose the same answers as your team

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In your notes, write the first word that comes to mind:

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marketing

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Four P's • Product • Price • Place • Promotion

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What is marketing?

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Marketing creating, communicating, and delivering value to customers

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cc licensed ( BY NC ND ) flickr photo by imagematters1: http://flic.kr/p/2cDA5w

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Product <-> Something of Value • Product? –Goods –Services • Value? –Money –Something else?

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No content

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Product?

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Something of value?

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Value of personal information • Address; $.50 • Zip: $.50 • Education: $12.00 • DOB: $2.00 • Employment: $13.00 • Phone: $.25 • Unlisted: $17.50 • Cell: $10.00 http://www.turbulence.org/Works/swipe/calculator.html

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cc licensed ( BY ) flickr photo by Slideshow Bruce: http://flic.kr/p/74JKE2

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cc licensed ( BY NC ND ) flickr photo by Daniel Pouliot: http://flic.kr/p/6JyKDJ

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Utility = usefulness • Form • Place • Time • Possession

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Transactions -> Relationships • Why? • New customers cost more than old –5-10x, Sears study found 12x

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Customer lifetime value • Value of long-term business from customer • Taco Bell? • $12,000 • Starbucks? • $14,000 • Publix? • $75,000 • Lexus? • $600,000

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Customer Equity • combined customer lifetime values of all customers

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cc licensed ( BY NC SD ) flickr photo by mliu92: http://flic.kr/p/9NHpEK

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Cadillac v. BWM • 1976: Cadillac had 52% luxury market share –Poor customer equity • BMW: lower market share –higher customer equity

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cc licensed ( BY NC ND ) flickr photo by Motovique: http://flic.kr/p/b34us4

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Customer Equity • BWM now #1 luxury brand, ahead of Mercedes-Benz • Cadillac market share dropped to 8%

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cc licensed ( BY ) flickr photo by comedy_nose: http://flic.kr/p/cZ1ZWS Target marketing

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The market cc licensed ( BY ) flickr photo by Muffet: http://flic.kr/p/adCYv

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Market segmentation cc licensed ( BY ) flickr photo by Muffet: http://flic.kr/p/af7Vr

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Target marketing cc licensed ( BY NC ) flickr photo by presta: http://flic.kr/p/6838Fd

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Segmentation methods • Demographic • Geographic • Psychographic • Behavioral

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Marketing Mix • Four P's: • Product • Price • Place • Promotion

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Marketing research • Market? • Primary data • Secondary data

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Primary data • Observation • Surveys • Interviews • Focus groups • Experiments –Cherry Vanilla Dr. Pepper: 61 formulas, 3904 tastings –Frito Lay chips: 4-psi breaking strength

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Primary data • Advantages? –Recent –Relevant –Proprietary • Disadvantages? –Expensive –Time to design/collect –Expertise in research design/analysis?

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Secondary data • Already-existing information • Census • CIA World factbook

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Secondary data • Advantages? –Fast –Inexpensive –Professional design/analysis • Disadvantages –May be out of date –May ask wrong questions –No competitive advantage