Essentials of marketing 3rd jim blythe

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THIRD EDITION JIM BLYTHE “Essentials of Marketing is an engaging introductory text for students new to the study of marketing.The third edition brings the latest issues within marketing theory and practice to life in an authoritative but very readable fashion Jim Blythe has carefully considered the needs of his readers through useful learning aids and an extensive glossary.” Dr Matthew Higgins, Lecturer in Marketing and Consumption, University of Leicester Looking for a concise, clear, jargon-free book on marketing? Go no further Jim Blythe’s Essentials of Marketing, third edition, is an ideal text for students new to marketing, students on a short introductory marketing course, overseas students needing a plain-English guide, or to anyone who needs a quick grasp of the subject ● NEW! Completely new, relevant and up-to-date case studies ● NEW! A fully rewritten Chapter 12, covering relationship marketing, Internet marketing, marketing ethics, and the changing conceptual position of marketing in the 21st century ● NEW! Extended coverage of global marketing theory ● Self-test questions designed to aid student learning ● Up-to-date and full referencing for the more academic student ● Recommended further reading for each chapter “This new edition provides students with an ideal platform from which to discover the fundamental principles of marketing The book offers an easy to follow and jargon-free source of core theories and concepts together with helpful illustrative examples from around the world.” Dr Phil Megicks, Head of Marketing Group, University of Plymouth, Senior Examiner for the Chartered Institute of Marketing’s Professional Certificate in Marketing Fundamentals module Jim Blythe is Senior Lecturer in the Business School at University of Glamorgan,UK He has numerous articles and publications in the field of marketing ESSENTIALS OF MARKETING THIRD EDITION JIM BLYTHE To access lecturer and student resources, including an instructor’s manual and PowerPoint slides, visit www.pearsoned.co.uk/blythe an imprint of JIM BLYTHE ESSENTIALS OF MARKETING THIRD EDITION ESSENTIALS OF MARKETING www.pearson-books.com Essentials of Marketing ii Marketing Planning: principles in practice We work with leading authors to develop the strongest educational materials in marketing, bringing cutting-edge thinking and best learning practice to a global market Under a range of well-known imprints, including Financial Times Prentice Hall, we craft high quality print and electronic publications which help readers to understand and apply their content, whether studying or at work To find out more about the complete range of our publishing please visit us on the World Wide Web at: www.pearsoned.co.uk Last A Head on Spread 000 Jim Blythe University of Glamorgan Essentials of Marketing Third Edition Pearson Education Limited Edinburgh Gate Harlow Essex CM20 2JE England and Associated Companies throughout the world Visit us on the World Wide Web at: www.pearsoned.co.uk First published under the Financial Times Pitman Publishing imprint 1998 Second edition 2001 Third edition 2005 © Financial Times Professional Limited 1998 © Pearson Education Limited 2001, 2005 The right of Jim Blythe to be identified as author of this work has been asserted by him in accordance with the Copyright, Designs and Patents Act 1988 All rights reserved No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without either the prior written permission of the publisher or a licence permitting restricted copying in the United Kingdom issued by the Copyright Licensing Agency Ltd, 90 Tottenham Court Road, London W1T 4LP All trademarks used herein are the property of their respective owners The use of any trademark in this text does not vest in the author or publisher any trademark ownership rights in such trademarks, nor does the use of such trademarks imply any affiliation with or endorsement of this book by such owners ISBN 273 69358 British Library Cataloguing-in-Publication Data A catalogue record for this book is available from the British Library Library of Congress Cataloging-in-Publication Data Blythe, Jim Essentials of marketing / Jim Blythe. 3rd ed p cm Includes index ISBN 0-273-69358-1 (alk.paper) Marketing I Title HF5415.B58 2004 658.8 dc22 2004057631 10 09 08 07 06 05 Typeset by 30 in Palatino 10/12.5pt Printed and bound by Ashford Colour Press, Gosport The publisher’s policy is to use paper manufactured from sustainable forests To Sue, with love, and to my daughters Sarah and Rhiannon, to whom the future belongs Supporting resources Visit www.pearsoned.co.uk/blythe to find valuable online resources For instructors • Complete, downloadable Instructor’s Manual including specimen answers to case study questions, MCQs and end of chapter questions, and a guide for instructors • PowerPoint slides that can be downloaded and used as OHTs For more information please contact your local Pearson Education sales representative or visit www.pearsoned.co.uk/blythe OneKey: All you and your students need to succeed OneKey is an exclusive new resource for instructors and students, giving you access to the best online teaching and learning tools 24 hours a day, days a week Convenience Simplicity Success OneKey means all your resources are in one place for maximum convenience, simplicity and success A OneKey product is available for Essentials of Marketing, third edition for use with Blackboard™, WebCT and CourseCompass It contains: • • • • • • Interactive Study Guide Learning objectives Case studies and questions Further assignments Quizzes Weblinks For more information about the OneKey product please contact your local Pearson Education sales representative or visit www.pearsoned.co.uk/onekey Last A Head on Spread 000 Brief Contents What marketers do? The marketing environment 22 Consumer and buyer behaviour 44 Segmentation, targeting and positioning 74 Market research 99 Products, branding and packaging 125 Pricing strategies 168 Distribution 189 Marketing communications and promotional tools 212 10 Marketing planning, implementation and control 261 11 International marketing 284 12 21st century marketing 308 Last A Head on Spread 000 Contents List of tables xiv List of figures xvi Preface Acknowledgements What marketers do? xviii xx Objectives Introduction About marketing The development of the marketing concept Marketing and other business disciplines Marketing on a day-to-day basis Marketing jobs Definitions of some marketing terms Meeting marketing resistance Quotations about marketing Case study 1: Tesco Summary Chapter questions Multi-choice questions Further reading Glossary References 2 7 11 12 14 14 17 17 18 19 19 20 The marketing environment 22 Objectives Introduction The marketing environment The external environment The internal environment Case study 2: The Australian telecommunications market Summary Chapter questions Multi-choice questions 22 23 23 23 36 37 39 40 41 340 Chapter 12 • 21st century marketing 23 McDonald, Jason B and Smith, Kirk: ‘The effects of technology-mediated communication on industrial buyer behaviour’, Industrial Marketing Management, 33 (2) (2004), pp 107–16 24 Moen, Oysten, Endresen, Iver and Gavlen, Morten: ‘Executive insights: use of the Internet in international marketing: a case study of small computer firms’, Journal of International Marketing, 11 (4) (2003), pp 129–49 25 O’Leary, Chris, Rao, Saly and Perry, Chad: ‘Improving customer relationship management through database/Internet marketing: a theory-building action research project’, European Journal of Marketing, 38 (3/4) (2004), pp 338–54 26 Fraedrich, John: ‘Philosophy type interaction in the ethical decision making process of retailers’, PhD Dissertation (Texas, A&M University, 1988) 27 Schultz, D.E and Schultz, H.E.: ‘Transitioning marketing communications into the twenty-first century’, Journal of Marketing Communications, (1) (1998), pp 9–26 Index Abell, D.F 85 ability, buying decision and 55 accommodation strategy 330, 337 accumulation 193, 194, 209 ACORN 117 action (AIDA) 218, 220, 221, 256 actual product benefits 129, 163 actual state 46, 68 adaptation 76, 82–3, 312–14 adoption 146, 249, 256 advantage comparative 285, 305 relative 146, 164 advertisements 213, 256 advertising 219, 237, 242 agencies 223, 224, 226, 251 decision-making checklist 221–3 definition 220 effectiveness 226, 227 institutional 223, 257 international 297 management of 220–6 manager 10, 223 product 223, 258 production 223–6 affect 54–5, 68, 249 affective states 48, 68 agents 192–3, 194, 209 export 296, 305 AIDA 218, 220, 221, 256 aided recall 227, 256 air travel (case study) 181–3 aircraft carriers (case study) 63–5 all-you-can-afford budgeting 273, 274 allocation (bulk breaking) 193, 209 Amazon.com 132, 199 ambushing 247 analogy 106, 121 approach-approach conflict 48 artefacts 217 ASEAN 286 aspirational groups 57 assorting 193, 194, 209 assortment depletion/extension 45, 68 attention (AIDA) 218, 220, 221, 256 attitude 34, 54–6, 60, 271, 272 attractiveness 87, 227 audit brand 148 marketing 262, 263–4, 265–6, 282 augmented product 317, 337 benefits 129, 163 automatic groups 57 auxiliary characteristics 126, 163 avoidance-avoidance conflict 48 Avon Cosmetics 204–6, 268 awards 245 awareness 146 brand 226, 248, 251, 256, 271, 272 backward integration 267, 282 BAE Systems (case study) 63–5 balance of payments 287, 304 Barksdale, H.C 134 barriers to entry 154, 292–3 barter 291, 304 BCG see Boston Consulting Group matrix behaviour consumer 45–51, 52 segmentation 78, 79, 96 see also buyer(s) belief 34, 55, 60 benchmarking 320–1, 337 benefits bundle of 126, 129–30, 190, 310 core 76, 96 bias, interviewer 110–11, 122 Note: Page numbers in bold indicate terms defined in glossaries 342 Index Bidwell, J 252 Bitner, M.J 9, 138 Body Shop 5, 31–2, 237, 316 Bonoma, T.V 81 Booms, B.H 9, 138 Boston Consulting Group 132–5, 269, 275 brands/branding 223 architecture 155, 163 audit 148 awareness 226, 248, 251, 256, 271–2 definition 147 equity 106 extension 155, 163 family 155, 163 image 147, 150, 151, 153, 154, 218, 247–8 loyalty 226 manager 10, 19 name 87, 147–50, 154, 155, 218, 272 purchase intentions 271 retailers’ own–brands 156–7, 230 semiotics and 149–51 strategic issues 148, 151–4 switching 228, 229, 256 value 229, 230 Brassington, F 288 break-down forecasting 89, 96 bring-a-friend schemes 245 British Airways 181 British Telecom 33, 86 brokers see agents Buchanan, P 298 budget setting 224, 250, 273, 274 see also cost(s) build-up forecasting 89, 96 bulk breaking (allocation) 193, 209 bulletin boards 324, 326 bureaucratic organisation 270, 282 buy-back 291, 304 buyer(s) 68, 312–14 consumer behaviour 45–51, 52 decision-making units 62–3 impulse buying 59–60 industrial 60–3 influences on decision 53–9 perception 51–3 support 313 see also consumer(s); customer(s) Buzzell, R.D 220 Cairns Agreement 286 Calentone, R.J 141, 144 cannibalisation 139, 141 capacity utilisation 156 career security, need for 60 cartoon tests 106 cash-and-carry wholesalers 193, 195, 196, 209 Cash Cow 132–3, 135, 163 cash volume sales analysis 275 catalogue showrooms 199, 209 Categorical Imperative 328 categorisation 51, 87, 314–15 category need 271 census (case study) 116–18 channel co-operation 201, 209 conflict 202, 209 of distribution 192–4, 204, 209 power 200–1, 209 children (role) 59 chip-and-pin credit cards 200 choice 47, 156 economic 171, 186 Christopher, M 310, 311, 320 chunking process 51, 87, 154 citizen action publics 31, 36 clinical focus group 105, 121 co-marketing 201, 209 Coca-Cola 12, 29, 51, 151, 155, 295, 297 cognition 54–5, 68, 249 cognitive dissonance 141 cognitive map 51–3 Cohen, J 14–16 commercial sign (brands) 150 commission 234–5 commodity products 147–8 communications 309, 325, 331–2 campaign planning 250–1 case study (Selfridges’) 252–3 developing 218–19 hierarchy of effects 248–9, 273 signs and meanings 215–18 theory 213–15 word-of-mouth 244–6 see also advertising; personal selling; promotion; promotional mix; public relations; salespeople/salesforce; telecommunications Index comparative advantage 285, 305 comparative parity budgeting 273, 274 compatibility 147, 163 competition 154, 191, 222, 229, 268 analysis 77, 275 international marketing and 288 matching approach 224 meet-the-competition strategy 178, 186 monopolistic 28, 29, 42, 179 perfect 29, 42, 170 shutting out 156 targeting and 84–5 undercut-the-competition strategy 178–9, 187 competitor-based pricing 178–80, 186 competitors 77, 181, 191, 223, 275 environment and 28–30, 265 complaints 50–1, 246, 312 complexity 147, 163 compositioning 155, 163 conation 54, 68, 249 concentrated marketing see niche marketers; niche marketing concentric diversification 267, 282 concessionaires 198, 209 confidence 54, 68 conflict 48, 58 channel 202, 209 conglomerate diversification 267, 282 connotative meaning 216 consequential losses 137 consideration set 47, 68 consumer(s) 11, 144–5, 151, 152, 298 behaviour 45–51, 52 in channels of distribution 192–4 control (Internet control) 325 orientation 4–5 perception 51–3 products 127, 163 see also customer(s) contactors 315, 337 continuous replenishment 204 convenience products 127, 163 convenience stores 198, 209 conviction 248, 249, 256 Cooper, R.G 141, 144 copy 223–6, 257 copyright 157 343 copywriter 224, 226, 257 core (generic) product 317, 337 core benefits 76, 96 core product benefits 129, 163 corporate image 248 corporate objectives 264, 267, 270, 282 cost(s) 152, 156, 180, 191 advertising 220, 221, 222, 223 –based pricing 172–4 direct 276, 282 effectiveness 266, 269–70 Internet 324, 327 leadership 269, 282 marketing cost analysis 273, 276, 282 non-traceable common 276, 282 planning 273, 274 –plus pricing 172–3, 181, 186 salesforce 233, 234–5 switching 146 traceable common 276, 283 countertrading 291, 305 coupons 221, 226, 227, 230, 250 Crawford, C.M 139 creativity 154 credit 200, 293, 332–3 crisis management 243 critical path method (CPM) 114 cross-docking 204 culture 35, 58, 68, 80, 265 internationalisation 285, 289–90, 293, 294 customary pricing 174, 186 customer(s) 7, 11, 28, 77, 157, 275–6 acceptance 140, 141, 144 analysis 79 –based pricing 174–8 environment and 27, 30, 265 expectations 49, 50, 52–3, 202, 318 intimacy 312, 325 loyalty see loyalty relationships 315–17 research 101, 121 retention 200 satisfaction 5–6, 10, 141, 144, 151 service 191, 192, 199–200 survey 90, 96 see also buyer(s); consumer(s) customisation 297, 305 customs union 286, 305 344 Index cut-off 47, 69 cycle analysis 91, 96 data 101, 111–16, 121 database marketing 230, 269–70, 323, 327, 337 DeChernatony, L 147 decider 62, 63, 69 decision 84–5 buying (influences) 53–9 strategic 262–3, 269 support systems 102, 121 tactical 262–3, 269, 329 decision-making heuristics 47, 69 influences 53–9 process 47–51, 171 units 62–3 defense strategy 330, 337 defensive PR 238, 242–3, 258 Delphi technique 90, 96 demand 11, 19, 169, 180, 222 derived 61–2, 69 elastic 170–1, 186 fluctuating 62, 69 inelastic 170–1, 186 joint 62, 70 price elasticity of 170, 187 pricing and 174–6, 186 demographics 42, 54, 116–18, 245 environment 25, 32, 291 segmentation 78, 79–80, 96 Denham, P 278 denotative meanings 216 deontology 328, 337 department stores 198, 209 depth interview 105, 121 derived demand 61–2, 69 description 61, 69 desire (AIDA) 218, 220, 221, 256 desired state 46, 69 Dibb, S 129, 192 differentiated marketing 83, 84, 96 differentiation 269, 282 brand 148, 152, 153 product 222, 250, 258 diffusion of innovation 145–7 direct costs 276, 282 direct marketing 230, 269–70, 323, 327 direct response 250, 257 discount sheds 198–9, 209 discounters 198, 209 discounts 174, 178, 200, 229 Disneyland 155, 202 dissociative groups 57 distribution 285, 296, 329 audit 265, 266 efficient consumer response 202, 204 logistics and 190–4 physical 190–4, 210, 285 research 101, 121 strategy 190, 209 see also retailers; wholesalers distribution channels 191–3, 272–3 management of 200–2, 203, 329 members 194, 200–1, 203, 204 distributor survey 90, 96 diversification 268 concentric 267, 282 conglomerate 267, 282 divestment 45, 51, 52, 69 Dodo 134, 135, 163 Dog 132, 133, 135, 163 Domesday marketing 200, 323, 337 drive 46, 69 drop shippers 196, 210 Drucker, P.F 14 Dugmore, K 117 dumping 180 Dunning, J.H 297 e-commerce see Internet early adopters/majority 140, 145, 163 eclectic theory 297, 305 ecological environment 35, 265 economic choice 171, 186 economic environment 26, 33, 291 economies of scale 130–1, 154, 156, 195, 285, 288, 298, 305, 314 economies of scope 154, 298 editing 111, 121 efficiency audit 266 efficient consumer response 202, 204 Egg (case study) 332–3 elastic demand 170–1, 186 electronic point-of-sale 200, 322 employees 37, 238–9, 241 markets 316, 337 see also salespeople/salesforce Index enjoyment (of advertisements) 226 entry 154, 292–3, 295–7 environment 63 audit 265 external 23–36, 42 internal 23, 36–7, 42 macro– 23, 25, 27, 32–6, 42, 101, 265 micro– 23, 25, 27–32, 42, 101 environmental stimulus 48, 69 equitable performance 49, 69 ethics 328–9 ethnocentrism 289, 292, 298, 299, 305 European Union 26, 34, 158, 286, 287 evaluation 139 of alternatives 45, 47–8, 52 heuristics 47 of performance 273, 275–6 post-purchase 45, 48–51, 52, 70, 138 Evans, M 200, 323 excess capacity utilisation 156 exchange rates 287, 294, 305 exclusive dealing 203, 210 execution format 224, 257 executive judgement 90, 96 expansion 156 expectations 49, 50, 52–3, 202, 318 expected performance 49, 69 expected product 317, 337 expenditure see costs(s) experiencing focus groups 105, 121 experiment/experimentation 106, 121 exploratory groups 105 exponential smoothing 114, 115 export agents 296, 305 export houses 296, 305 exporting 287, 291, 292, 296, 305 external environment 23–36, 42 external search 46, 69 extremity 54, 69 factor analysis 115 family 57–9, 78 family branding 155, 163 Farris, P.W 220 feedback 218, 244, 262–3, 273, 277 Ferrell, O.C 129 finance 31, 141 see also cost(s) 345 fire-fighting approach 235, 242–3, 258 Five Forces model 28, 30 flaming 324 fluctuating demand 62, 69 focus 269, 282 focus group 105, 110, 121, 150, 327 Ford 151, 223, 295, 296, 297 forecasting break-down 89, 96 build-up 89, 96 sales 89–91, 275 formal groups 57 forward integration 267, 282 4–P model 7, franchising 198, 296, 297, 305 free gifts 217, 228 free 'taster' samples 228, 230, 251 free trade areas 286 frequency 224, 230, 257, 314–15 Frequent Flyer programmes 322 friendship need 60 'front-liners' 238, 239 full-line forcing 203 full-service merchant wholesalers 196, 210 function audit 266 functional capability (brands) 153 functional organisation 271, 282 future marketing trends 330–2 gatekeeper 62, 69 GATT 286 gender relations 25, 57–8 general-merchandise wholesalers 196, 210 generic (core) product 317, 337 geocentrism 292, 298, 299 geographic segmentation 78–9, 81, 84, 96 geographical factors 35, 236, 275 global segmentation 293–5 globalisation 35, 297–300, 305, 309 see also international marketing Gordon, W 150 government 31, 36, 241, 290 green marketing/issues 324, 332 Greenpeace 36, 243, 324 Gregory, K 292 group 63 depth interview 105, 121 pressure 35, 36, 241–2, 330 346 Index group (Continued) reference 56, 57, 70 see also focus groups growth strategies 267–8 habitual purchase behaviour 51, 52 Hamill, J 292 Harley Davidson 150 Harris, C.E 134 hedonic benefits 190 hedonic needs 45–6, 69, 76 Heinz 155, 158 Herzberg, F 235 heuristics 47, 69 hierarchy of needs theory 235 High and Mighty 84 Hofstede, G 293 holiday business (case study) 91–3 horizontal diversification 267 horizontal integration 202, 210, 267, 282 Hovis 150 Hutson, J 159 hypermarkets 197, 198, 210 IBM 14, 81, 236, 297, 312 icon 215, 257 ideal performance 49, 69 image 148, 248, 250 brand 147, 150, 151, 153–4, 218, 247 of stores 150–1, 200 importing 287, 291, 305 impulse buying 59–60 income, per capita 291, 305 index 215, 257 individualism 35, 63, 293, 330 industrial buyer 60–3, 299 industrial markets, segmenting 81–2 industrial products 127, 128–9, 163 industry 233–4, 236, 275 inelastic demand 170–1, 186 influence on buying decisions 53–9 informational 56, 69 markets 316, 337 value-expressive 56, 71 influencers 62, 69, 315, 337 influentials 244–5 informal groups 57 information 48, 101, 122, 194, 236 search 45, 46–7, 52 information technology 25, 35, 330, 331 informational influence 56, 69 innovation 140, 145–7 see also new product development innovators 145, 163 inspection 61, 70 institutional advertising 223, 257 intangibility 11, 128, 136, 138 integration 331–2 horizontal 202, 210, 267, 282 vertical 202, 211 intellectual property 296 interest 226 AIDA 218, 220, 221, 256 interference 214, 215, 257 intermediaries 31, 203 internal environment 23, 36–7, 42 internal marketing 37, 237, 316–17 internal networks 327–8 internal PR 239, 247, 257 internal publics 36, 42 internal search 46–7, 70 international marketing barriers to entry 291–3 entry strategies 295–7 global segmentation 293–5 globalisation 298–300 reasons for 287–91 trade initiatives 285–7 International Monetary Fund 286 Internet 25, 35, 199, 292–3, 309 auctions 327, 331–2 marketing 323–8 interpreting 111, 122 interrupts 47–8, 54, 70 interview 110 depth 105, 121 structured 106, 123 interviewer bias 110–11, 122 involvement, level of 54 isolateds 315, 337 jobs/job description 9–11 joint demand 62, 70 joint marketing 155 joint ventures 296, 305 Index Judd, V.C 314 just-in-time method 192 Kalcher, K 277–8 Kant, I 328 Katz, E 214 key network management 314 kinetics 217 knowledge 55, 248–9 see also information Koestler, A 154 Kotler, P 5, 8, 266 Kropf, S 205–6 labelling (of packaging) 158 laggards 140, 145, 164 language 289, 295 Lastminute.com 132, 199, 332 late majority 140, 145, 164 law of primacy 53, 70 Lazarsfield, P 214 legislation/legal factors 13, 26, 265 brands 153, 157 current (examples) 33–4 packaging/labelling 157, 158 Legoland (case study) 277–9 Levi-Strauss 151, 155 Levitt, T 317 licensing 296, 305 lifestyle 6, 25, 78, 79, 83, 245, 293 campaigns 221, 257 liking/likeability 226, 248, 249 limited-line wholesalers 196, 210 limited-service wholesalers 196, 210 line family branding 155, 164 load up 230 loading 178, 186 local publics 31–2 location 7, 199, 264, 294 logistics 30–1, 42, 190–4, 210, 285 logos 218, 230 'lookalike' branding 156–7 lottery and scratch cards 228 low-cost airlines (case study) 181–3 loyalty 37, 78 brand 226 card 15, 200, 210, 230, 315, 322 347 customer 6–7, 51, 200, 228, 276, 288, 309, 310, 327 Lufthansa 138, 322 McCarthy, E.J McConnell, D 204 McDonald, M 147 McDonald's 237, 242, 296, 298, 300, 324 macro-environment 23, 25, 27, 32–6, 42, 101, 265 mail-bombing 324 mail (postal surveys) 106, 122 mail order wholesalers 196–7 mailing list 230, 323 mailshots 249, 257 Manchester United (case study) 300–1 manufacturers 156–7, 229, 230 margin 173, 186 marginal approach (budget) 274 mark-up 173, 186 mark-up pricing 172, 173–4, 181, 186 market 12, 20, 85–6, 139–40, 265, 288 barriers 292 development 264, 268, 282 entry strategies 295–7 influence 316, 337 orientation, pricing and 172–80 referral 316, 338 share 28, 132–3, 134–5, 179, 223 specialisation 86 supplier 316, 338 market research 10, 100–3, 226 analysing results 111–16 approaching respondents 103–11 census (case study) 116–18 products 126, 133, 139, 141 test marketing 91, 97, 140, 174 marketing 9, 19, 148, 155 audit 262–4, 265–6, 282, 321 co-marketing 201, 209 concept development 3–7 cost analysis 273, 276, 282 definitions 2–3 differentiated 83, 84, 96 direct 230, 269–70, 323, 327, 337 Domesday 200, 323, 337 environment research 101, 122 348 Index marketing (Continued) ethics 328–9 future trends 330–2 green 324, 332 information systems 101–2, 122 internal 37, 237, 316–17 multinational 296–7, 305 niche see niche marketing orientation 10–11, 20, 318 research 100, 122 resistance (and responses) 12–13 role 7, 8, 330–2 services 135–8 societal 5–6, 20, 35, 329 telemarketing 199, 211 test 91, 97, 140, 174 traditional 309–15, 338 transaction 309–15, 338 undifferentiated 83, 97 see also brands/branding; buyer(s); distribution; environment; international marketing; planning; positioning; pricing; price; product; promotion; relationship marketing; segmentation; sustainable marketing; targeting marketing mix 7, 20, 151, 270 Seven Ps 9, 84, 138, 264, 294–5 Markus, H 54 Martin, T 158, 159 Maslow, A 235 mass marketing 76, 83, 84, 97 mass media 146, 245 mass production 3, 75–6 matrix 112, 122, 270, 271 meaning, signs and 215–18 mechanistic organisation 270, 282 media 224 events 240–1, 257 media publics 31, 36 meet-the-competition strategy 178, 186 Meidan, A 114 merchant wholesalers 195, 210 message 214–15, 218, 219, 220 metaphor 154 micro-environment 23, 25, 27–32, 42, 101 mid-life kickers 131, 164 missionaries 231, 233, 257 modified re-buy 61 modifiers 315, 337 money-off offers 226, 228, 250, 251 monitoring performance 273, 275–6 monopolistic competition 28–9, 42, 179 monopoly 29, 37, 42 Mosaic 117 motivation 46, 55, 70, 235 Mountford, S 205 multi–stage interaction 145, 146 multinational marketing 296–7, 305 multisegmented marketing 83, 84, 96 multivariable segmentation 80, 96 myths/mythical values 150 natural monopolies 29, 37 need(s) 9–10, 11, 20, 60, 126, 199, 232 hedonic 45–6, 69, 76 Maslow’s theory 235 utilitarian 45, 71 negotiation 61, 70 Nestlé 297 networks 112, 122, 314, 327–8 new entrants 30 new product development 164, 266, 295 clusters 141–4 launch 139–40, 229–30, 240, 248–51, 272 planning 139 positioning 141–5 promotion 228 success rates 141, 143–4 see also innovation; trial new task 61 niche marketers 198, 210 niche marketing 12, 83, 85, 86, 96, 199 noise 214, 215, 257, 273 non-store retailing 199, 210 non-traceable common costs 276, 282 normative compliance 56, 57, 70 North American Free Trade Agreement 286 numbers 217 objective and task approach 224, 250, 273, 274 objectives 148, 224, 262, 265 corporate 264, 267–8, 270, 282 observability 147, 164 observation 106 odd-even pricing 178, 187 Index oligopoly 29, 42 omnibus studies 107, 122 opinion leaders 214–15, 244–5 opportunities (SWOT) 24, 25, 329 optimal stimulation level 46, 70 order getters/takers 231, 233, 257 organisation 63, 81, 266, 292 organismic organisation 270, 282 outshopping 197, 210 own-brands 156–7, 230 ownership, brands and 153 packaging 157–8 panels 107, 122 Parasuraman, A 318, 319 patents 157, 177, 296 Patti, C.H 222 pay (salesforce) 234–5 peer-group pressure 56 penetration pricing 85, 179, 187 people 9, 138, 264, 294 PepsiCo 29, 151 per capita income 291, 305 percentage of sales budgeting 224, 274 perception 51–3, 55, 87, 96 perceptual mapping 87, 88, 89, 96, 141 perfect competition 29, 42, 170 performance 273, 275–6, 277 equitable 49, 69 expected 49, 69 ideal 49, 69 perishability 12, 136, 191, 296 persistence 54, 70 personal selling 219, 231–2, 257 see also salespeople/salesforce personal structured interviews 106 personality 55, 60, 245 PEST analysis 25, 329 Pettitt, S 288 philosophy marketing 13, 264 physical distribution 190–4, 210, 285 physical evidence 9, 138, 264, 294 physical goods 11, 50, 135, 136–8, 321 piggy-backing 228, 257, 296, 305 piloting 108, 122 place 7, 264, 294 planned impulse 59–60, 70 planning 154, 274 349 audit 262, 263–4, 265–6 campaign 250–1 corporate objectives 264, 267–8, 270, 282 feedback 262–3, 277 performance 273, 275–6 promotional strategies 270–3 tactical 262, 268–70 political environment 26, 33, 290–1 polycentrism 298, 299 Porsche 76, 151 Porter, M.E 28, 30 positioning 75, 87–9, 96, 250 post-purchase consonance 49, 70 post-purchase dissonance 49–50, 70, 137, 200 post-purchase evaluation 45, 48–51, 52, 70, 138 post-tests 227, 257 postal surveys 106, 122 potential product 317, 337 power, channel 200–1, 209 power distance 293 PR see public relations pre-tests 226, 227, 258 predatory pricing 179–80, 187, 329 preference 248, 249 premium 82–3, 97 press 36, 237, 239–40, 245, 251 pressure groups 35, 36, 241–2, 330 prestige 60, 78 prestige pricing 178, 187 Priceline.com 199 pricing/price 7, 12, 148, 264, 294 audit 266 economic theories of 169–71 elasticity of demand 170, 187 ethics 329 fixing 179, 329 guarantees 203 leaders 179, 187 market orientation and 172–80 risk 137 setting (stages) 180–1 strategies 169–83 wars 178, 179 see also discounts; premium Pride, W 129 primacy, law of 53, 70 primary characteristics 126, 164 primary groups 57 350 Index primary research 102, 103, 122 private responses 49, 70 proactive management 23, 43 proactive PR 243, 258 proactive strategy 330, 337 probability (random) sample 109, 123 Problem Child 133, 135, 164 problem recognition 45–6, 52 process 9, 128, 138, 262–4, 294 Procter & Gamble 220, 295 producers 151, 152, 192–4 product 11–12, 20, 164, 264, 294, 314 advertising 223, 258 audit 266 barriers 292 benefits 126, 129–30, 163, 190, 310 category 28, 56, 222, 223, 227 champions 140 classification of 127–30 commodity 147–8 concept 318 consumer 127, 163 convenience 127, 163 core (generic) 317, 337 definition 126 development 268, 283 differentiation 222, 250, 258 ethics 328 expected 317, 337 group, sales by 275 industrial 127, 128–9, 163 influentials and 244–5 international marketing 292, 295 life cycle 130–5, 145, 164, 250, 275, 288 –line pricing 176–7, 187 manager 10, 20 mix (in shops) 200 organisation 271 orientation 3–4, 7, 20 packaging 157–8 personality 154 potential 317, 337 range 126, 130–5, 145 research 101, 122 shopping 127, 164 specialisation 86 speciality 127, 164 substitute 40 unsought 127, 164 see also augmented product; brands/ branding product development 268, 283 see also innovation; new product development production 13, 136, 223–6, 288, 296 orientation 3, 20, 318 productivity audit 266 profit/profitability 82, 85, 175–6, 180, 276, 292 program evaluation and review technique (PERT) 114 project teams 139, 140 projective techniques 105, 122 promotion 7, 140, 156, 264, 294–5 campaign 250–1, 330 ethics 328–9 monitoring/evaluation 273, 275–6 research 101, 122 sales 219, 226–31, 258 strategies 270–3 techniques 227–8 promotional mix 219, 248–9, 258 see also advertising; personal selling; promotion; public relations prospects 236, 258 protectionism 290, 298, 305 psychographic segmentation 78, 79, 97 psychological factors 53–6, 292 psychological pricing 177–8, 187 psychological proximity 289–90, 305 public relations 219, 223, 258, 316 definition 236–7 internal 239, 247, 257 manager 10 media events 240–1 other publics and 241–2 press and 239–40 proactive 243, 258 reactive 238, 242–3, 258 role/function 243–4 sponsorship 246–8 staff and 238–9, 241 word-of-mouth 244–6 publics 12, 20, 43, 258 internal 239, 247, 257 marketing environment 31–2, 36, 43 PR and 241–2 Index pull strategies 230, 272–3 purchase 45, 48, 52, 271 see also buyer(s) pure impulse 59–60, 70 push strategies 229, 272, 273 qualitative data analysis 111–13 qualitative objectives 264 qualitative research 104–6, 116, 122 quality 155, 177–8, 311, 316, 338 management, total 319, 338 product 144, 317–18 services 310, 318–19, 320–1 quantitative data analysis 113–16 quantitative research 104, 117, 122 questionnaires 106–8 quota sample 109, 122 rack jobbers 196, 210 Rae, J 117 random factor analysis 91, 97 random sample 109, 123 ratchet effect 228, 258 rational campaigns 221, 258 re-buy (modified/straight) 61 re-invention 147, 164 reach 224, 258 reaction strategy 330, 338 reactive management 23, 43 reactive PR 238, 242–3, 258 recall, aided 227, 256 recall, unaided 227, 259 recognition tests 227 recruitment (salesforce) 232 Redken 127, 313 redundancy (communication) 214, 258 reference group 56, 57, 70 referral markets 316, 338 regional organisation 271, 283 registration (brand names) 149 reinforcement, advertising and 223 relationship marketing 6–7, 270, 276, 327, 338 customers/other players 315–17 development of 317–23 traditional versus 309–15 relative advantage 146, 164 relative power 312, 313 reminder impulse 59–60, 70 resistance 12–13, 54, 71 resources 77, 83–4, 171, 292 respondents 103–11, 123 responses direct 250, 257 private 49, 70 third-party 50, 71 voice 49, 71 retailers 192–4, 210, 229, 231, 272 image 150–1, 200 own-brands 156–7, 230 trends 199–200 types of 197–9 Ries, A 149 risk 46, 137, 153, 293 Roddick, A 316 Rogers, E.M 145, 146 roles 56–9, 71 roll-cage sequencing 204 roll-out 140 Rolls-Royce 6, 318 Sainsbury 156, 328 sales analysis 273, 275–6, 283 cycle 234, 258 forecasting 89–91, 275 manager 10, 20, 232 orientation 4, 20 percentage budgeting 224, 274 personal selling 219, 231–2, 257 research 101, 123 territory 203, 236, 258 sales promotion 219, 226–31, 258 see also promotion salespeople/salesforce 10, 20, 63, 221 distribution and 194 functions/qualities 231–2 management of 232–6 survey 90, 97 see also personal selling sample 104, 108, 123 sample frame 108, 123 sampling 61, 71, 108–9 bias 110, 123 SCEPTICAL analysis 329 Schultz, D.E and H.E 330 search, information 45, 46–7, 52 351 352 Index season tickets 322–3 seasonal analysis 91, 97 seasonal offers/sales 229, 230 second-market discounting 178, 187 secondary groups 57 secondary research 102–3, 123 segmental organisation 271, 283 segmentation 12, 28, 43, 75–83 behavioural 78, 79, 96 demographic 78, 79–80, 96 effectiveness 82–3 geographic 78–9, 81, 84, 96 global 285, 293–5 of industrial markets 81–2 multivariable 80, 96 psychographic 78, 79, 97 reasons for 75–7 single-variable 80, 97 trade-offs 82 variables 77–80 see also targeting selective specialisation 86 selectivity 52, 87 self-administered surveys 107 self-liquidating offers 230, 258 self-referencing 289 Selfridge's (case study) 252–3 selling unique, proposition 250, 259 see also personal selling; sales semantics 217–18 semiotics 149–51, 216 service(s) 11, 30, 87, 195, 314 complaints 50–1, 246, 312 factors distinguishing 136 industrial 128 marketing 135–8 pricing 178 quality 310, 318–19, 320–1 quality benchmarking 320–1, 338 retail 199–200 7–P framework 9, 84, 138, 264, 294–5 Shapiro, B.P 81 shelf price 173, 187 shelf space 229 shopping products 127, 164 sign 149–51, 215–18, 258 signals 47, 71 significance testing 115–16 silent communications 217 Simkin, L 129 single-variable segmentation 80, 97 situational analysis 24–7 situational factors (buying) 54 skimming 85, 174, 177, 187 Skoda 88 slogans 238–9 Smith, A 170 Smith, W.R 75 social activity (of influentials) 245 social factors (buying) 53, 56 social needs 60 societal marketing 5–6, 20, 35, 329 socio-cultural environment 25, 34–5 socio-cultural sign 150 Sock Shop 83, 86, 198 Sony 144, 177, 297 sorting out 193, 210 space 217 spamming 324 Spar 196, 198 specialisation 84, 86 speciality line wholesalers 196, 210 speciality products 127, 164 specifications 60 sponsorship 36, 59, 237, 246–8 stages of development theory 293, 296–7, 306 stakeholders 309, 338 standby airfreight 191, 211 Star 132, 133, 135, 164 statistical methods/testing 114–16 STEP analysis 25, 329 stock levels 229 Stockwell, T.E 14 stores 200, 229, 230 see also retailers straight re-buy 61 strategic fit 140 strategic marketing planning 77 strategic objectives 264, 267–8 strategy 140, 262–3, 283 accommodation 330, 337 alternatives 264, 267 audit 265 branding 148, 151–4 defence 330, 337 Index distribution 190, 209 entry 295–7 market coverage 85–6 meet-the-competition 178, 186 proactive 330, 337 reaction 330, 338 sustainable marketing 329–30 undercut-the-competition 178–9, 187 see also planning; targeting stratified sample 109, 123 strengths 263 SWOT analysis 24, 25, 329 structured interviews 106, 123 subjectivity 51 substitute products/services 30 success rates (products) 141, 143–4 suggestion impulse 59–60, 71 supermarkets 14–16, 198, 211 loyalty cards 15, 200, 210, 230, 315, 322 suppliers 28, 29, 30–1, 312–14 markets 316, 338 supply 169, 327 support staff 231 support systems, decision 102, 121 surveys 90, 96, 97, 104, 106–8, 122 sustainable marketing 309–34 see also relationship marketing switching, brand 228, 229, 256 switching cost 146 SWOT analysis 24, 25, 329 symbols 149, 153, 213, 215, 216, 259 synergy (production/marketing) 141–4 syntactics 216–17 systems decision support 102, 121 information 101–2, 122, 266 tabulating 111, 123 tactics 262–3, 268–70, 283, 295, 329 tamper resistance 157, 164 target audience 84, 218, 224, 247 target market 180 targeting 75, 83–6, 97 see also segmentation tariffs 286, 287, 292, 298, 306 task environment 265 taxonomy 112–13, 123 teamwork 154 353 teaser campaigns 221, 248, 251, 259 technical development 139, 140 technological environment 25–6, 35–6 telecommunications 37–9, 105, 107, 199 teleconferencing 105, 123 telemarketing 199, 211 teleology 328, 338 telephone surveys 107, 123 Telstra (of Australia) 33, 38–9 Tesco 14–16, 156, 197 test marketing 91, 97, 140, 174 tests/testing post-tests 227, 257 pre-tests 226, 227, 258 significance 115–16 third-party responses 50, 71 threats (SWOT analysis) 24, 25, 329 Tie Rack 83, 86, 198 time 132, 217 –series analysis 90–1, 97 total quality management 319, 338 Toys'R'Us 174, 329 traceability 191, 192, 211 common costs 276, 283 trade see international marketing trade-offs 82 traditional marketing 309–15, 338 training (sales staff) 233–4 transaction marketing 309–15, 338 transnational consumer segmentation 293 transport 191–2, 297 tree taxonomy 112–13 trend analysis 91, 97 trial 146, 230 trialability 136, 137, 147, 164 trickle-down theory 145, 146 two-for-the-price-of-one 228 two-step flow theory 145, 146 tying contracts 203, 211 unaided recall 227, 259 undercut-the-competition strategy 178–9, 187 undifferentiated marketing 76, 83, 84, 97 unique selling proposition 250, 259 unit sales analysis 275 United Airlines 138, 322 unsought products 127, 164 usage rate 81, 97 354 Index user 62, 71 utilitarian needs 45, 71 utilitarian sign 150 valence 54, 71 Valentin, V 150 value 6, 12, 150, 227, 310, 314 brand 229, 230 economic theories of 169–71 –expressive influence 56, 71 value for money 4, 12, 87, 89, 172–3, 177, 178, 179 variety stores 198, 211 venture teams 139, 140 vertical integration 202, 211 video-conferencing 105, 123 Virgin 155, 267 virtual shopping 106, 326 voice responses 49, 71 Volkswagen 76, 88 vouchers 228 Walton, S 14 want 11, 20, 126 War Horse 134, 135, 164 Watson, T 14 weaknesses 263 SWOT analysis 24, 25, 329 wealth concentration 291, 306 Webster, F.E 63 Weinberg, R 264 Wetherspoon (J.D.) 158–9 wholesalers 192–7, 211, 272 Wind, Y 63 word-of-mouth 237, 244–6, 326 Young, L 14 Zajonc, R.B 54 [...]... chapter • Extended coverage of global marketing theory • A fully-rewritten Chapter 12, covering relationship marketing, Internet marketing, marketing ethics, and the changing conceptual position of marketing in the 21st century Overall, the book is intended to offer an insight into what marketing is all about: it is written by an enthusiast, a believer in the marketing ethos Marketing is about facilitating... • explain the responsibilities of various types of marketing manager; • explain the core concepts of marketing; • explain how marketing activities fit in with other business disciplines; • describe the development of the marketing concept 1 2 Chapter 1 • What do marketers do? INTRODUCTION This chapter is an introduction to the basic concepts of marketing, seen in terms of the roles that marketers carry... relationships Service quality model 310 313 319 Preface Essentials of Marketing has provided a clear outline of the principle theories of marketing in clear, jargon-free language for almost eight years now The book is intended to provide an overview of marketing thought and practice for students new to marketing, for students on short introductory marketing courses, for overseas students who need a plain-English... requirements efficiently and profitably (UK Chartered Institute of Marketing) Marketing is the process of planning and executing the conception, pricing, promotion and distribution of ideas, goods and services to create exchange and satisfy individual and organisational objectives (American Marketing Association) Both of these definitions have been criticised The Chartered Institute of Marketing (CIM) definition... international marketing Political factors in international marketing International Internet marketing Internationalisation and the 7-P framework International market entry strategies Stages in globalisation 286 288 290 292 294 295 299 12.1 12.2 12.3 12.4 Transaction v relationship marketing Five stages for service benchmarking Characteristics of the Internet as a marketing tool Stages of integration of marketing. .. the kind of lives they would wish for themselves and their families, and it delivers a standard of living, but above all marketing is about ensuring that business meets the needs of its customers Sadly, despite more than fifty years of marketing thought, many companies still measure their success in financial terms (instead of in customer satisfaction terms), still calculate the profitability of products... been criticised because it takes profit as being the only outcome of marketing, whereas marketing approaches and techniques are widely used by organisations such as charities and government departments which do not have profit as their goal The American Marketing Association (AMA) definition has also been criticised for failing to take account of the increasing role of marketing in a broader social context,... colleagues in industry, who showed me that the marketing concept is not obvious to everyone, and that marketers also need to understand the viewpoint of other professionals Any errors and omissions are, of course, mine Jim Blythe July 2004 Acknowledgements We are grateful to the following for permission to reproduce copyright material: Figure 1.1 from Principles of Marketing, Kotler, P., Armstrong, G., Saunders,... change the mass of customers to fit the organisation’s aims, the marketing concept seeks to change the organisation’s aims to fit one or more specific groups of customers who have similar needs This means that marketers often meet resistance from within their own organisations The development of the marketing concept 5 In practice, the marketing concept means finding out the needs and wants of a particular... customer orientation, the role marketing occupies relative to other business functions has also evolved Under a production-orientated regime marketing usually occupies a departmental role; the marketing role is contained within a marketing department which carries out the communications functions of the firm Figure 1.2 shows the evolution of marketing s role within the organisation MARKETING ON A DAY-TO-DAY
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