CH-1 Overview of Marketing – Marketing : Book Guide

Chapter One: Overview of Marketing Concept Review Generally, the concept questions are designed to achieve a single purpose – to encourage students to test their knowledge and understanding of the theoretical content of the chapter. These questions encourage recall and reflection, which will better prepare students to answer the marketing applications questions based on their understanding of the theory. 1. What is marketing and why is it important? Marketing is a set of business practices designed to plan for and present an organization’s products or services in ways that build effective customer relationships. Marketing is important because it helps create value for firms. 2. Is the marketing mix (4Ps) enough to guarantee successful marketing? Explain. The controllable set of interrelated decisions known as the marketing mix, (Product, Price, Place, and Promotion) is central to all marketing activities. However, they are never a guarantee of successful marketing. Making the right marketing decisions and executing them properly simply maximize a product or company’s potential for success. Marketers can substantially increase their chances for success if they have a deep understanding of their environment and their competition, build strong relationships with suppliers, customers, and other marketing intermediaries, establish a corporate culture that places the customer at the centre of the firm’s marketing activities, and above all, offer customers products and services that satisfies their needs and wants, i.e. deliver strong value. 3. Explain how a strike at one of the company’s supplier firms or a new technology would influence the company’s marketing efforts? Marketing is shaped by external forces and players. A supplier strike or a new technology might change how the company deliver value to its customers. A strike at a supplier plant may lead to shortage of inputs – raw material or parts – that could restrict the ability of the company to produce sufficient quantity of products to meet demand. For example, a prolonged strike at a parts supplier may reduce the ability of Ford or GM to manufacture enough vehicles to meet demand because they don’t have necessary parts for their vehicles. Technology can have both positive and negative effects on a company’s marketing efforts. Some types of technology may render a company’s existing technology obsolete while creating opportunities for companies with the new technology. For example, the Internet has changed the way marketers interact and communicate with their customers, suppliers and others companies. 4. Discuss the main elements of value-based marketing. List four ways in which marketing helps to create value. There are two main elements to value-based marketing: value, and cost. The central goal is to provide consumers with value or benefits that are perceived to be much greater than their costs. Value can mean different things to different people and is constantly changing in today’s marketplace. Depending on the product, it may include size, speed, convenience, colour, or taste. Costs often reflect time, effort and money sacrificed. Ways in which marketing helps to create value include, 1) coordinating across the organisation, 2) coordinating across the supply chain, 3) expanding a firms’ global presence, 4) making life easier, 5) providing employment opportunities and 6) enriching society. 5. Explain the relationship between customer value and customer satisfaction. Customers naturally seek options that provide the greatest benefits at the lowest costs. A satisfied customer is one who has received value greater than the costs incurred. Value is derived from the 4Ps: product creates value, price transacts value, place delivers value and promotion communicates value. Costs to a customer can include the price paid, information given or time lost. Customer value is the difference between the benefits earned and cost paid. Customer satisfaction is when a customer’s expectations of value or benefits are met – usually when costs are less then benefits derived, and in a fair way. Customer satisfaction may be described in two ways – satisfaction with individual transactions or satisfaction derived over a period of time from an accumulation of transactions. 6. Generally, all companies are in business to generate profits and increase shareholder value. Yet, the Canadian Marketing Association definition of marketing given on page 2 does not explicitly mention profits or shareholder value. Why do you think these are not included in the definition? Should they be included? Profits and value to the shareholder are not included because they define success too narrowly as monetary profits – and do not account for all aspects of value. The marketing function can create value that is not reflected in dollars and cents, such as building strong, trust-based relationships with loyal customers, or performing detailed market research that uncovers new consumer wants, needs and behaviours. Marketing can often be a cost centre whereas sales is a profit centre, and therefore profit need not be included as part of the definition of marketing. Moreover, the definition implies that firms that consistently deliver good value to customers and build strong relationships will eventually becomes successful and profitable. 7. Today, many marketers are not interested in selling their products and services to everyone who wants it, but only to selected target markets. What do you think the main reasons are for targeting specific market segments? In order to plan and execute marketing communications that reached and attracted every single consumer, one would require a budget so large it would not be feasible. Although marketers would prefer to sell their products and services to everyone, it is not practical to do so. Companies identify target groups who they expect to respond to their marketing efforts similarly. By targeting specific market segments a company can develop marketing programs that specifically address the needs and wants of each chosen segment, thereby increase the chance of success of their marketing programs. This way also, marketers can ensure their scarce resources are allocated and used maximally. 8. Give reasons why you think understanding customer needs and wants is fundamental to marketing success. How can marketers go about understanding customer needs and wants? Customer needs and wants are fundamental to marketing success because they are the primary motivator for action. When an unsatisfied need is recognised, the customer desire is to go from their actual, needy state to a different, desired state. Understanding customer needs help marketers develop marketing mixes to satisfy those needs in ways customers prefer. Building strong relationships with customers is important to obtaining information, creating value and is the central concept of the relational orientation. This is known as customer relationship management (CRM), and maximizes the long-term value of the buyer-seller relationship rather than trying to maximize the profit from each transaction. CRM often includes collecting customer information in order to target specific promotions or offers to customers who would benefit most. Generally, market research discussed in greater detail in Chapter 4 describes the range of methods marketers use to better understand customer needs and deliver strong value when trying to satisfy those needs. 9. Which marketing orientation would most likely help a company build strong customer relationships that are profitable? Why? Value-based marketing allows for the strongest relationships to be built with customers. This is because it starts with understanding what customers needs and want and delivering strong value to satisfy those needs/wants. In this respect, the value-based orientation encourages the collection and organisation-wide sharing of customer information, balancing benefits with costs, and strives to develop strong customer relationships. Keeping close contact with customers in an attempt to encourage customer-marketer dialogue, customer satisfaction and customer loyalties are fundamental to the value-based orientation. The value-based orientation does not view each customer-marketer contact as a series of individual transactions where the marketer must maximise profits. Rather, each customer-marketer contact as an opportunity to satisfy the customer and strengthen their relationships, which over the long-term will generate customer loyalty and ultimately increased profitability. 10. Explain how customer value is created or increased when the company’s marketing department works closely with other departments within the firm as well as with the firm’s suppliers and customers. In value-based marketing firms, the marketing department works seamlessly with other functional areas of the company to design, promote, price, and distribute products. As well, for the supply chain to provide significant value to the ultimate customer, the parties must establish long-term relationships with one another and cooperate to share data, make joint forecasts, and coordinate shipments. Effectively managing supply chain relationships often has a huge impact on a firm’s ability to satisfy the consumer, which results in increased profitability for all parties. The more the marketing department can work closely with other departments, and share information across the supply chain, the more the firm can understand and better satisfy the needs and wants of its customers, therefore increasing the value to the customer. Marketing Applications When apparel manufacturers develop marketing strategies, do they concentrate on satisfying their customers’ needs or wants? What about a utility company? A cellular phone company? When developing marketing strategies, apparel manufacturers typically focus on both satisfying their customers' needs and wants. Needs refer to the basic requirements that customers have, such as clothing to protect themselves from the elements or adhere to social norms. Wants, on the other hand, are desires or preferences that go beyond basic necessities, such as fashionable clothing or items that reflect personal style. Apparel manufacturers often leverage both aspects in their marketing strategies. They might emphasize the functionality and quality of their products to meet customers' needs for durability and comfort, while also promoting the style, trends, and aesthetics to appeal to customers' wants for fashion and self-expression. For a utility company, the emphasis is primarily on satisfying customers' needs rather than wants. Utilities provide essential services such as electricity, water, and gas, which are fundamental for daily life. Marketing strategies in this industry typically focus on reliability, affordability, and efficiency to meet customers' basic needs for access to essential services. In the case of a cellular phone company, the marketing approach may vary depending on the target market and competitive landscape. While addressing customers' needs for reliable communication and connectivity is essential, cellular phone companies often differentiate themselves by appealing to customers' wants for advanced features, innovative technologies, and personalized experiences. This can include offering the latest smartphone models with cutting-edge features, customizable service plans, and perks like entertainment bundles or loyalty rewards programs. In summary, while both needs and wants are considered in marketing strategies across different industries, the emphasis may vary based on the nature of the products or services offered and the preferences of the target market. Instructor’s Notes: This question is intended to make students think about the difference between customer needs and wants, as well as how companies might address one or both. It also challenges students to explore whether different types of companies address the needs and wants of consumers differently. An apparel company might focus more on a customer’s wants while providing for the customer’s basic clothing needs—for example, a coat designer might cover the basics of a customer’s need for a coat by offering one appropriate for the season but strongly appeal to that customer’s wants by offering many seasonal coat selections in unique colours and styles that provide more fashion-forward coat choices. Firms also must respond to competitors’ offerings. An electric utility company might have a strong imperative to satisfy customers’ needs for reliable electricity but not focus as much on customer wants because it faces little market competition. Example answers: For an apparel manufacturer to develop a successful marketing strategy, it must take into account both needs and wants of customers. The degree to which the apparel manufacturer fulfills both needs and wants heavily influences whether it successfully sells its products. Example #1 Product Crest toothpaste Place Drugstores, grocery stores, wholesale clubs (Shoppers Drug Mart, Loblaws, Costco) Promotion Newspaper and magazine advertisements, supported by moderate TV and cable advertising. “Healthy beautiful smiles for life” (www.crest.com)  promotes beauty, vitality, and life-long benefits Price Suggested retail price, but with price promotions depending on retail channel and new product release schedule (e.g., newspaper coupon inserts for new products) Example #2 Product Honda Civic sedan Place Honda dealerships, preowned vehicle dealers Promotion Heavy TV and cable advertising, as well as full-colour magazine advertisements. “Evolution. Revolution. This is no time to stand still—the all-new Honda Civic is ready to take you places you’ve only imagined” (www.honda.com)  promotes freshness of design, speed, and dream fulfillment. Price Manufacturer’s recommended pricing, with potential promotions at the dealership level. “Build-your-own-Civic” functionality via the Honda Web site, which allows customers to see the price of a car with their own option selections. • A utility company might consider its customers’ needs more (e.g., reliable water or electric supply to homes and businesses) but also consider customers’ wants (e.g., how they wish to receive the service, how they prefer to be billed) to achieve higher customer satisfaction and provide offers that go beyond basic needs. A cellular phone company must focus on both the customers’ needs (e.g., basic, reliable service) and wants (e.g., providing the latest, hottest phones, Internet access) to market its products successfully in today’s highly competitive cellular phone market. Choose a product that you use everyday. Describe its 4Ps. 1. Product: Toothpaste • The actual toothpaste product includes the paste or gel substance that aids in cleaning teeth and maintaining oral hygiene. • Variants: Different types of toothpaste exist, catering to specific needs such as whitening, sensitivity relief, enamel protection, etc. • Packaging: Toothpaste is typically packaged in tubes, often with various sizes available for different consumer needs. 2. Price: • Toothpaste prices can vary based on brand, ingredients, and target market. • Economy brands are generally cheaper, catering to price-conscious consumers, while premium brands may charge higher prices, often associated with additional features or premium ingredients. • Price discrimination might exist based on packaging size, with larger sizes offering better value for money. 3. Place: • Toothpaste is widely available in numerous distribution channels, including supermarkets, pharmacies, convenience stores, and online platforms. • Placement within stores is crucial; toothpaste is commonly found in the oral care aisle, strategically positioned alongside other dental hygiene products. • Distribution networks ensure toothpaste availability in both urban and rural areas, reaching a wide consumer base. 4. Promotion: • Advertising: Toothpaste brands often advertise through various mediums such as television, social media, print media, and online platforms to create brand awareness and influence consumer purchasing decisions. • Sales Promotion: Offers like buy-one-get-one-free, discounts, or bundled deals are common strategies to stimulate sales and attract customers. • Endorsements: Celebrity endorsements or recommendations from dental professionals can enhance the credibility and appeal of toothpaste brands. • Point of Sale Displays: Eye-catching displays near checkout counters or within stores can encourage impulse purchases. Instructor’s Notes: This question is designed to personalize the four major marketing elements for students. Choosing a product that he or she uses everyday and analyzing its 4Ps (product, price, place, and promotion) forces the student to think about how the four elements might come together to make it attractive. This exercise takes the product away from the realm of something that the student simply uses and enjoys and into a better understanding of what makes the product appealing to the student personally. Example answers: McDonalds Product: burgers, fries, soft drinks, milk shakes, Combo meals, etc. Price: low cost to appeal to target markets Place: widespread distribution in all major cities in the world Promotion: uses a mix of advertising, sales promotion (e.g. Happy Meals), public relations (Ronald McDonald charities), personal selling (at the point of purchase) Provide examples of three firms that are involved in both B2C and B2B marketing. 1. Apple Inc.: Apple engages in both B2C and B2B marketing. On the consumer side, Apple markets its products like iPhones, iPads, and MacBooks directly to individual consumers through its retail stores, online store, and various marketing campaigns. On the business side, Apple offers a range of products and services tailored to businesses, including enterprise software solutions, bulk purchasing options, and specialized support services. 2. Microsoft Corporation: Microsoft is another example of a company that operates in both B2C and B2B markets. On the consumer side, Microsoft markets products such as Windows operating system, Xbox gaming consoles, and Office 365 directly to individual consumers through various channels. On the business side, Microsoft offers enterprise software solutions, cloud services (Azure), and productivity tools tailored to businesses of all sizes. 3. Amazon.com, Inc.: Amazon is involved in both B2C and B2B marketing through its e-commerce platform and Amazon Web Services (AWS) respectively. On the consumer side, Amazon markets a wide range of products to individual shoppers through its online marketplace and Prime subscription service. On the business side, AWS provides cloud computing services to businesses, including startups, enterprises, and government organizations, through a B2B model. Instructor’s Notes: Students probably can very easily identify B2C companies, because these firms are parts of the student’s everyday life, but it might be more difficult for them to think of B2B firms. Hence the challenge of this question: Students must think beyond their everyday life and comfort zone. Example answers: General Motors promotes its vehicles to both retail customers (B2C) and other companies for fleet vehicle leasing or rental car sales (B2B). Microsoft Corporation sells its software applications to home computer users (B2C) and also promotes its IT consulting services to other corporations (B2B). Disney promotes fun, family-friendly vacations to individual consumers (B2C) and offers convention services and catering to other businesses (B2B). Pick a firm that you believe provides its customers with good value. Justify your answer by explaining how the firm competes on value. A prime example of a company that consistently provides good value to its customers is Costco Wholesale Corporation. Costco competes on value through several key strategies: Low Prices: Costco is renowned for its low prices on a wide range of products, including groceries, electronics, appliances, and household goods. By leveraging its massive buying power and negotiating favorable deals with suppliers, Costco is able to pass on significant savings to its customers. High-Quality Products: Despite offering low prices, Costco maintains a reputation for selling high-quality products. Customers trust the Costco brand to deliver goods that meet their standards, whether it's the Kirkland Signature private label products or brand-name items. Membership Model: Costco's membership model plays a crucial role in its value proposition. While customers pay an annual fee to access Costco's warehouses, the savings they receive on products often far exceed this fee. This model creates a sense of exclusivity and loyalty among members while also serving as a barrier to entry for competitors. Efficient Operations: Costco operates with a lean and efficient business model, which allows it to minimize overhead costs and operate on thin profit margins. This efficiency enables Costco to offer lower prices to customers while still maintaining profitability. Bulk Purchasing: One of Costco's key value propositions is its bulk purchasing concept. By selling items in large quantities, Costco is able to further drive down costs per unit, offering even greater savings to customers who are willing to buy in bulk. Overall, Costco competes on value by consistently delivering high-quality products at low prices through its efficient operations, membership model, and bulk purchasing strategy. This focus on value has helped Costco maintain a loyal customer base and continue to thrive in the retail industry. Instructor’s Notes: This question encourages students to think not only of a firm that they believe provides good value but also about the source of that value and how the firm delivers value. After all, value can be a subjective criterion that potentially differs for each student. Even if different students pick the same firm, they might attribute value to different aspects of the same product or service. If the student can identify a firm, probe him or her to explain what provides the value and how he or she realizes that value, as delivered by the firm. Example answer: Apple, through its best-selling iPod devices and iTunes online music store, creates value through a fun, easy-to-use, unique design and by offering a vast selection on iTunes, including both standard and “iTunes exclusive” music and video options. By using iTunes, customers achieve several potential benefits: they need not drive around looking for music at retail outlets, they can buy individual songs rather than a whole album, and they can manage their music and video library from a single computer interface rather than cumbersome CD cases or videotapes. Assume you have been hired by the marketing department of a major consumer products manufacturer, such as Colgate-Palmolive. You are having lunch with some new colleagues in the finance, manufacturing, and logistics departments. They are arguing that the company could save millions of dollars if it just got rid of the marketing department. Develop an argument that would persuade them otherwise. 1. Brand Awareness and Recognition: The marketing department is responsible for building and maintaining brand awareness. Without marketing efforts, consumers may forget about the products or not even know they exist. This would lead to a significant drop in sales and revenue. 2. Consumer Insights and Market Research: Marketing professionals conduct extensive research to understand consumer preferences, behaviors, and market trends. This information is invaluable for developing products that meet consumer needs and preferences. Without marketing, the company would be operating blindly, potentially wasting resources on products that don't resonate with the target market. 3. Competitive Advantage: In today's competitive market, brand differentiation is crucial. Marketing strategies help position the company's products/services uniquely in the market and communicate their value proposition effectively. Without marketing, the company would lose its competitive edge and struggle to stand out among competitors. 4. Product Launches and Promotions: Marketing departments play a pivotal role in launching new products and promoting existing ones. They create marketing campaigns that generate excitement and drive sales. Without these efforts, the company would struggle to introduce new products successfully and maximize sales potential. 5. Customer Relationships and Loyalty: Marketing activities, such as advertising, social media engagement, and customer support, help foster strong relationships with customers. Building brand loyalty leads to repeat purchases and positive word-of-mouth, which are essential for long-term success. Without marketing, the company risks losing its loyal customer base to competitors who invest in building relationships. 6. Revenue Generation: Ultimately, the goal of marketing is to drive revenue. While it may seem like a cost center, the marketing department actually contributes to the company's bottom line by attracting and retaining customers. Eliminating marketing would result in a significant revenue loss that far outweighs any short-term cost savings. 7. Integrated Approach: Marketing doesn't operate in isolation. It works closely with finance, manufacturing, and logistics to align strategies and ensure efficient resource allocation. By eliminating the marketing department, the company would disrupt this integrated approach and hinder overall business performance. In conclusion, while it may seem like cutting the marketing department would save money in the short term, the long-term consequences would be detrimental to the company's success. Marketing is not just a cost center; it's a strategic investment that drives growth, fosters customer relationships, and ensures the company remains competitive in the marketplace. Therefore, it's essential to recognize the value that marketing brings to the organization and invest in its continued success. Instructor’s Notes: This scenario forces students to think about the purpose and value of marketing in an organizational context and allows for a variety of justifications. For example, a student could use an internal or external perspective and argue that finance, manufacturing, and logistics tend to worry less about the customer and more about internal processes, whereas the marketing and sales functions constantly focus outward on the customers the company serves. Using this argument, the student might question whether other departments are willing or prepared to take on customer relations and develop an understanding of how and why customers buy the company’s product or service. Another argument might simply demand how customers will even know about the company’s products if the marketing department doesn’t broadcast their features, benefits, and value outward. Example answer: Marketing is a necessary function for three reasons: It focuses on understanding what the company’s customers actually want and need, as well as how to derive value from the company’s products and services. A department dedicated to this function frees other departments to focus on what they do best—be it finance, manufacturing, or logistics. It can act as a buffer between external customers and internal company functions, save other departments from customers’ direct demands, and cut down on the amount of churn within the organization. It understands how to communicate the breadth and value of the company’s products to an external audience and ensures the audience knows that the company and its products even exist. Without this communication and the subsequent knowledge gained by the customer, there would be no sales revenue and, consequently, no company! Why do marketers find it important to embrace societal needs and ethical business practices? Provide an example of a societal need or ethical business practice being addressed by a specific marketer. Marketers find it crucial to embrace societal needs and ethical business practices for several reasons: Building Trust and Credibility: By aligning with societal needs and ethical practices, marketers can build trust and credibility with their target audience. Consumers are more likely to support and remain loyal to brands that demonstrate a commitment to social responsibility and ethical behavior. Enhancing Brand Reputation: Embracing societal needs and ethical practices can enhance a brand's reputation. Positive associations with social causes or ethical behavior can differentiate a brand from its competitors and attract socially conscious consumers. Mitigating Risks: Failure to address societal needs or engage in unethical practices can lead to reputational damage, legal repercussions, and loss of customers. Embracing ethical business practices reduces the risk of negative consequences and helps companies maintain a positive image in the eyes of consumers, regulators, and other stakeholders. Meeting Consumer Expectations: Today's consumers, particularly younger generations, increasingly expect brands to take a stand on social and environmental issues. By embracing societal needs and ethical practices, marketers can meet these expectations and resonate with their target audience. One example of a societal need being addressed by a specific marketer is Patagonia, an outdoor apparel company known for its commitment to environmental sustainability. Patagonia has implemented various ethical business practices, such as using recycled materials in its products, reducing water usage in manufacturing processes, and donating a portion of its profits to environmental causes. Additionally, Patagonia's marketing campaigns often emphasize its dedication to protecting the planet, resonating with environmentally conscious consumers and reinforcing its brand identity as a socially responsible company. This approach has helped Patagonia build a strong brand reputation and attract loyal customers who value sustainability. Instructor’s Notes: This question centres on the role of social and ethical issues in a marketing context. Students might mention efforts such as keeping the environment clean and offering fair wages to workers, then argue why a marketer should be concerned about those issues. Example answers: Ben & Jerry’s donate a percentage of its proceeds from certain products to worthy causes. Starbucks Coffee promotes its fair trade coffee blends and bottled water sales that support third-world water purification programs. The Body Shop commits to no animal testing for its cosmetics line. 7. Visit the website of Rogers Communications (http://rogers.com/) and compare the 4Ps marketing mix for its BlackBerry Bold Series and BlackBerry Tour Series. What factors might explain the differences you observe? Product Differences: The BlackBerry Bold Series and BlackBerry Tour Series may have different features, specifications, and target markets. The marketing mix for each product line would likely reflect these differences. For example, if one series targets business professionals seeking productivity features, its marketing mix might emphasize performance and security. In contrast, if the other series targets frequent travelers, its marketing mix might focus on global connectivity and durability. Price Variation: Pricing strategies can vary based on factors such as production costs, perceived value, and competitive positioning. Differences in the pricing of the BlackBerry Bold Series and BlackBerry Tour Series could influence their respective marketing mixes. For instance, if one series is positioned as a premium product with advanced features, its marketing mix might highlight exclusivity and value-added benefits. Placement and Distribution Channels: The availability and distribution of the BlackBerry Bold Series and BlackBerry Tour Series may differ based on regional preferences, retail partnerships, and sales channels. The marketing mix would likely be tailored to reach the target audience through appropriate distribution channels, whether it's through online sales, carrier partnerships, or retail stores. Promotional Strategies: Marketing communication tactics, such as advertising campaigns, promotions, and endorsements, may vary between the BlackBerry Bold Series and BlackBerry Tour Series. The promotional mix would likely be designed to resonate with the specific needs and preferences of each target market. For example, if one series targets tech enthusiasts, its marketing mix might leverage digital channels and influencer partnerships to generate buzz and excitement. Overall, understanding the unique characteristics and target audiences of the BlackBerry Bold Series and BlackBerry Tour Series would be essential for crafting effective marketing mixes tailored to each product line's objectives and positioning within the market. Instructor’s Notes: This question encourages students to not only identify the 4Ps from the tons of information on a company’s website but also to think how a company develops marketing mixes for different market segments. They must also be able to link the differences in the marketing mix to the characteristics or needs/wants of the different customer segments. Example answer: 4Ps BlackBerry Bold BlackBerry Tour Product Design and features - more business/professional look, feel, and functionality Design and features - more consumer look, feel, and functionality Price From $169.99 plus charges for rate plans From $149.99 plus charges for rate plans Promotion Websites of RIM, Rogers Communications, and national newspapers, network TV business channels Websites of RIM, Rogers Communications, newspapers, local TV stations Place Available through Rogers Communications and Telus Available through Rogers Communications and Telus Users Business Professionals Consumers and small business owners 8. For many consumers the difference between Dasani water made by Coca-Cola (http://www.dasani.com/) and Aquafina made by Pepsi (http://www.aquafina.com/) is hardly noticeable. However, both companies and their loyal customers would argue that there are many differences between these two brands of water. What is your view? Explain how customer perceptions and emotions may influence the way they value a company’s product. From a purely objective standpoint, the differences between Dasani and Aquafina may be minimal. After all, both are purified water brands owned by major beverage companies, Coca-Cola and PepsiCo respectively, and are subject to similar regulations and quality standards. However, the perceived differences between the two brands can be significant for consumers. These perceptions are shaped by various factors, including marketing strategies, brand image, packaging, availability, and even personal experiences. 1. Brand Image and Marketing: Coca-Cola and PepsiCo have invested heavily in creating distinct brand images for Dasani and Aquafina. This includes advertising campaigns, endorsements, and branding initiatives. These efforts can influence consumers' perceptions of the brands and create a sense of loyalty among customers. 2. Packaging and Design: The design of a product's packaging can influence how consumers perceive its quality and value. Even subtle differences in bottle shape, label design, or color scheme can sway consumers' preferences. 3. Availability and Accessibility: The availability of Dasani and Aquafina in various locations can impact consumer choices. If one brand is more readily available or prominently displayed in stores, consumers may be more inclined to choose it over the other. 4. Personal Experience and Emotional Attachment: Consumer perceptions are often influenced by personal experiences and emotional connections to a brand. Positive experiences with one brand, such as enjoying refreshing taste or feeling satisfied with customer service, can create loyalty and influence repeat purchases. 5. Social Influence: Peer recommendations, online reviews, and social media buzz can also shape consumer perceptions of a brand. Positive word-of-mouth or influencer endorsements can enhance a brand's reputation and influence consumer preferences. In conclusion, while the actual differences between Dasani and Aquafina may be subtle, consumer perceptions are heavily influenced by a variety of factors, including brand image, marketing, packaging, availability, personal experiences, and social influence. These perceptions and emotions play a crucial role in how consumers value and choose products, often outweighing objective considerations of quality or composition. Instructor’s Notes: This question centres on the subjective bases consumers use to assign and evaluate value to competing products and services. Students will realise that value is not always determined by objective measures such as product features, prices, etc. Example answers: Students’ answers may vary but focus on ideas such as loyalty to a brand, company reputation, look and feel of product, experience, attitude to bottled water, and pricing. Generally, the stronger and more positive the customer’s feelings, emotions and experiences with a particular brand, the more likely they will assign a greater value to that brand of water. 9. As described in this chapter, customer relationship management is a very important aspect of value-based marketing. Pick any one of Canada’s major retailers, e.g. The Bay (http://www.hbc.com/), Loblaws (http://www.loblaws.ca/), or Shoppers Drug Mart (http://www.shoppersdrugmart.ca/), and explain how they go about building strong customer relationships with their customers. Shoppers Drug Mart, a prominent Canadian retailer, excels in building strong customer relationships through various strategies: Optimum Program: Shoppers Drug Mart's Optimum program is one of the most successful loyalty programs in Canada. Customers earn points on purchases, which can be redeemed for discounts on future purchases. This program not only incentivizes customers to continue shopping at Shoppers Drug Mart but also provides personalized offers based on their purchase history, enhancing the customer experience. Personalized Communication: Shoppers Drug Mart utilizes data analytics to personalize communication with customers. They send targeted emails, app notifications, and direct mail with personalized offers and recommendations based on customers' purchase history and preferences. This tailored approach makes customers feel valued and understood, strengthening their loyalty to the brand. In-Store Experience: Shoppers Drug Mart focuses on providing exceptional in-store experiences. Their well-trained staff members offer personalized assistance and advice to customers, creating a welcoming atmosphere. Additionally, the layout of their stores is designed to make shopping convenient, with clear signage and easy navigation, enhancing the overall customer experience. Community Engagement: Shoppers Drug Mart actively engages with the community through various initiatives such as fundraising campaigns, health awareness programs, and partnerships with local organizations. By demonstrating their commitment to the community, Shoppers Drug Mart builds trust and loyalty among customers who appreciate their efforts to give back. Digital Integration: Shoppers Drug Mart has embraced digital technology to enhance customer relationships. Their mobile app allows customers to refill prescriptions, browse products, and access exclusive deals conveniently. They also use social media platforms to engage with customers, share health tips, and promote their products and services, fostering a sense of community among their online followers. Overall, Shoppers Drug Mart's focus on personalized communication, exceptional in-store experiences, community engagement, and digital integration enables them to build strong and lasting relationships with their customers, positioning them as a trusted healthcare and retail destination in Canada. Instructor’s Notes: This question asks students to think about the ways in which marketers try to build strong customer relationships. Students should discuss how the techniques identified are actually used by marketers to build customer relationships and to what extent they think these measures are successful in influencing their own individual purchasing behaviour. Example answers: Students may identify a variety of methods based on their individual experiences. However, most will likely focus on customer loyalty programs (and the many variations) as well as various marketing communication that are either general in nature or personalised. Ask students to discuss to what extent their purchase decisions are influenced by these techniques and whether or not they think they benefit from the various methods. Real practical examples should be solicited from the students. 10. Apple’s iPhone is seen by many industry analysts as a competitor to RIM’s BlackBerry Pearl. Visit Apple’s website (http://www.apple.com/) and Rogers Communications website (http://rogers.com/) to learn more about these two products. What do you think the main value proposition is for each product? Which company do you think will come out as the winner and why? As of my last update, Apple's iPhone and RIM's BlackBerry Pearl were indeed competitors in the smartphone market, though the landscape may have evolved since then. Let's analyze the main value propositions for each product and speculate on which company might come out as the winner: Apple iPhone: Value Proposition: The iPhone is known for its sleek design, intuitive user interface (iOS), and extensive ecosystem of apps and services. Its main value propositions include a seamless user experience, innovative features such as Face ID and Siri, high-quality camera systems, and integration with other Apple products like MacBooks and iPads. Differentiation: Apple focuses on delivering a premium user experience, emphasizing design, performance, and ecosystem integration. Its strong brand loyalty and widespread appeal among consumers contribute to its competitive advantage. RIM BlackBerry Pearl: Value Proposition: The BlackBerry Pearl was known for its compact size, physical keyboard (in earlier models), and strong security features, particularly appealing to business professionals. Its main value propositions included efficient communication capabilities, secure messaging (BBM), and robust email handling. Differentiation: BlackBerry differentiated itself by prioritizing security and productivity, catering primarily to business users who valued reliability and data security. It was also known for its physical keyboard, which some users preferred for typing efficiency. Winner Speculation: Considering the evolution of the smartphone market and the trends in consumer preferences, Apple's iPhone likely has the edge over RIM's BlackBerry Pearl for several reasons: Consumer Preference: The iPhone has gained widespread consumer acceptance and is popular among both individual consumers and businesses. Its user-friendly interface, extensive app ecosystem, and integration with other Apple devices make it a compelling choice for a wide range of users. Innovation: Apple continuously introduces innovative features and technologies with each new iPhone release, maintaining its position at the forefront of the smartphone market. Features like Face ID, advanced camera systems, and augmented reality capabilities contribute to the iPhone's appeal and competitiveness. Ecosystem Integration: Apple's ecosystem, including products like MacBooks, iPads, Apple Watch, and services like iCloud and Apple Music, creates a seamless user experience and encourages brand loyalty. This integration provides additional value to iPhone users and strengthens Apple's position in the market. Market Share and Brand Recognition: Apple has consistently held a significant share of the global smartphone market and enjoys strong brand recognition and customer loyalty. This market presence and brand reputation give Apple a competitive advantage over competitors like RIM. While the BlackBerry Pearl may have had its strengths, including security features and a loyal business user base, it likely struggled to compete with the broader appeal and innovation of the iPhone. Therefore, Apple's iPhone is more likely to emerge as the winner in this comparison, based on its broader consumer appeal, continuous innovation, and strong ecosystem integration. Instructor’s Notes: This question encourages students to think about the value proposition of competing products from two highly reputable global companies – one Canadian and one American. Most students would have experience with Apple’s products but not likely with RIM’s products. This could be an interesting avenue to explore in terms of how this experience influence their thinking about value proposition beyond price as well as which company will likely come out the winner. Example answers: Students will compare these two products on things such as look and feel (design), features, price, company’s reputation (for quality products and services, reliability, innovation, etc.), compatibility with their iPods and other devices, etc. Students may even rate the products differently based on various tasks, e.g., iPhone maybe better than the BlackBerry for browsing the web and as a pocket organiser but the BlackBerry Pearl maybe better for text messaging because of its keyboard may be easier to use than iPhone’s. Net Savvy Happy Planet (http://www.happyplanet.com/), a Vancouver-based organic juice producer is an emerging player in the organic beverage market supplying all of Canada and some of the U.S. with organic juice. Visit its Web site and describe how it delivers value above and beyond that provided by traditional grocery retailers. Describe the ways in which the company communicates this value through its Web site. Happy Planet delivers value above and beyond traditional grocery retailers through its website in several ways: 1. Product Information and Transparency: The website provides detailed information about their products, including ingredients, nutritional information, and sourcing practices. This transparency builds trust with consumers who are increasingly concerned about the quality and origins of their food and beverages. 2. Educational Content: Happy Planet's website features educational content about organic farming practices, sustainability initiatives, and the benefits of consuming organic products. This helps to educate consumers and differentiate the brand as a leader in ethical and sustainable business practices. 3. Engagement with Community: The company actively engages with its community through its website, featuring stories about local farmers and suppliers, as well as initiatives to give back to the community through charitable partnerships or environmental projects. This fosters a sense of connection and loyalty among customers. 4. Convenience and Accessibility: Happy Planet's website offers online ordering and delivery options, making it convenient for customers to purchase their products without having to visit a physical store. This convenience factor can be a significant value-add for busy consumers or those living in areas where organic options may be limited. 5. Personalized Experience: The website may also offer features such as personalized recommendations based on customer preferences or previous purchases, enhancing the overall shopping experience and making it more tailored to individual needs and preferences. Through its website, Happy Planet effectively communicates these value propositions by prominently featuring them on the homepage and throughout the site. This includes clear messaging about their commitment to organic, sustainable practices, testimonials from satisfied customers or partners, and easy-to-navigate sections that highlight product information, educational content, and community initiatives. Additionally, the website may utilize visually appealing design elements, such as vibrant imagery or videos, to further engage visitors and communicate the brand's values and offerings effectively. Instructor’s Notes: This exercise allows students to analyze how a socially responsible grocery retailer creates value and communicates that value to its customers. Students might examine the images and words Happy Planet uses to express its message, the breadth of the appeal of those elements to different customer segments, which elements appear most prominently on the Web site, and what that selective prominence says about the priority of value being expressed. Example answers: The company gives an overview of not just the nature of the company but also its social values. To reinforce that message, the company has chosen to include its mission statement in the centre of its homepage and discusses it contribution to the community through its Community Partners Program. Montreal’s Biodome (http://www2.ville.montreal.qc.ca/biodome/site/site.php?langue=en) has developed an excellent reputation in international scientific and cultural circles for the diversity of its collection. Visit its Web site and describe the ways in which it creates value for patrons. The Montreal Biodome creates value for its patrons through its website in several ways: 1. Virtual Tours and Exhibits: The website offers virtual tours and exhibits, allowing visitors to explore the Biodome's diverse collection of flora and fauna from different ecosystems around the world. This feature provides accessibility to individuals who may not be able to visit the physical location and enhances the educational experience for those planning a visit by previewing the exhibits. 2. Educational Resources: The website provides a wealth of educational resources, including information about the various ecosystems represented in the Biodome, conservation efforts, and biodiversity. These resources are valuable for students, educators, and anyone interested in learning more about environmental science and sustainability. 3. Event Information: The website serves as a hub for information about events, workshops, and special exhibits hosted by the Biodome. This helps patrons stay informed about upcoming opportunities to engage with the facility and its offerings, fostering repeat visits and ongoing patronage. 4. Membership and Support Opportunities: The website provides information about membership options and support opportunities for patrons who wish to contribute to the Biodome's mission of conservation and education. This allows individuals to become more deeply involved with the organization and support its continued success. 5. Accessibility Information: The website offers information about accessibility accommodations for visitors with disabilities, ensuring that all patrons can fully enjoy the Biodome's offerings. This commitment to inclusivity enhances the value of the Biodome as a destination for individuals of all backgrounds and abilities. Overall, the Montreal Biodome's website enhances the value proposition for patrons by providing access to educational resources, virtual experiences, event information, and opportunities for engagement and support. By offering these features, the Biodome extends its reach beyond its physical location and enriches the experiences of both current and potential patrons. Instructor’s Notes: This exercise is intended to get students to determine the value non-profit organizations offer their patrons. Example answers: The Biodome provides its patrons with a wide variety of animals (292 species), plants (288 species) and birds from across the world, which they can observe on a visit to the Biodome. In addition, the Biodome provides a wide variety of interactive activities for patrons, especially kids and younger children, to learn about the planet and the world’s ecosystem. It offers shows and demonstration activities. The facility is modern and offer all the convenience needed for a family day out or a school tour. Its website offers a wide variety of information – text, audio, and videos - about its collection. It offers a range of affordable pricing plans for entry to the facility. The service is very friendly and professional. End-of-Chapter Case Study: Tablet War: RIM’s PlayBook versus Apple’s iPad Who do you think the PlayBook’s primary customers were at the time of its launch? Who were the customers for the iPad. At the time of its launch, the primary customers for the PlayBook were likely enterprise users and business professionals, given BlackBerry's strong presence in the corporate market and its focus on security and productivity features. The PlayBook was positioned as a business-friendly tablet with features tailored to corporate needs, such as strong encryption, secure email, and compatibility with BlackBerry Enterprise Server. On the other hand, the iPad's primary customers were more diverse, ranging from consumers to business users. Apple positioned the iPad as a versatile device suitable for various purposes, including entertainment, productivity, education, and creative work. Its user-friendly interface, extensive app ecosystem, and sleek design appealed to a broad demographic, from tech enthusiasts to casual users and professionals across different industries. Instructor’s Notes: This question challenges students to think about who the primary target for the respective devices was. Most students probably will choose retail (individual) consumers because of the devices similar functionality and use. However, ask students to think a bit deeper into their answers to see if they understand that the unique stage of each company’s evolution and strategy led them to target different segments, at least initially. Example answer: RIM’s PlayBook was primarily targeted to its existing business enterprise customers while Apple’ iPad was targeted at individual consumers. The main reason for this is that RIM was dominant in the business market while Apple was dominant in the retail or consumer market. Thus, the devices were targeted to their existing customer base. It is usually easier for companies to develop new products for their existing customers in order to retain them and serve their growing needs. Do you think both devices provide adequate value to their customers? Which of these two devices do you prefer?. Both devices, iPhones and Android smartphones, offer significant value to their respective customers, but the choice between them ultimately depends on individual preferences and needs. iPhones, known for their seamless integration with other Apple products, robust security features, and sleek design, appeal to users who prioritize user experience, ecosystem coherence, and privacy. On the other hand, Android smartphones offer a wide range of customization options, diverse hardware choices, and flexibility in terms of software. They attract users who enjoy personalizing their devices, experimenting with different features, and having access to a variety of apps from different sources. As for my preference, as an AI, I don't have personal preferences. However, both devices have their strengths and weaknesses, and the choice between them depends on what features and ecosystem align better with the user's preferences and needs. Instructor’s Notes: This question asks students to analyze the two devices and indicate their preferences. The answers they provide for their preferences may reveal a lot about how they think about the companies, the devices, and their own shopping habits, experiences and preferences. Example answers: Students should be able to compare the two devices on the 4Ps as outlined in Exhibits 1.10, 1.11, and 1.12 of the case. In terms of preferences, their answers can range from their experiences with the respective products, to loyalty, the image associated with owning the products and other factors that go beyond price and convenience. What main factors do you think RIM considered before it priced the PlayBook lower than the iPad? Do you think the lower price will entice customers to purchase the PlayBook instead of the iPad? When RIM (Research In Motion) priced the PlayBook lower than the iPad, they likely considered several key factors: 1. Market Positioning: RIM may have recognized that the iPad already had a significant market share and brand loyalty. By pricing the PlayBook lower, they aimed to position it as a more accessible alternative for consumers who were price-sensitive or looking for a more affordable option. 2. Feature Set: RIM likely evaluated the feature set of the PlayBook compared to the iPad and determined that, while it may not have all the same features, it offered competitive functionality at a lower price point. This could include factors such as screen size, processor speed, storage capacity, and available apps. 3. Competitive Landscape: Analyzing the competition in the tablet market, RIM may have seen an opportunity to gain market share by undercutting the iPad's price. Lowering the price could attract consumers who were considering the iPad but were open to alternatives that offered similar value at a lower cost. 4. Profit Margins: While pricing the PlayBook lower than the iPad may have reduced profit margins per unit sold, RIM may have calculated that the increased volume of sales resulting from the lower price could ultimately lead to higher overall profits. Whether the lower price will entice customers to purchase the PlayBook instead of the iPad depends on various factors, including: 1. Brand Loyalty: Apple has a strong brand following, and many consumers may prefer the iPad due to brand loyalty and familiarity with Apple's ecosystem. 2. Perceived Value: Customers will assess the features and capabilities of both devices relative to their price. If they perceive that the PlayBook offers sufficient value for its lower price, they may choose it over the iPad. 3. Ecosystem Compatibility: Some consumers may already be invested in Apple's ecosystem, with apps, services, and accessories that are compatible with the iPad. This compatibility could sway their decision towards the iPad despite the price difference. 4. Word of Mouth and Reviews: Positive reviews and recommendations from friends, family, or trusted sources can influence purchasing decisions. If the PlayBook receives favorable reviews and word of mouth, it could attract more customers despite its lower price. In summary, while pricing the PlayBook lower than the iPad may make it more appealing to certain segments of the market, its success in enticing customers away from the iPad will depend on various factors including brand loyalty, perceived value, ecosystem compatibility, and reviews. Instructor’s Notes: This question asks students to think about how being a follower in the market (market timing) could influence competitive strategy. Students are also challenged to think about the extent to which pricing strategies influence customer purchases of consumer electronics. For some people, the lower prices may serve as an incentive to purchase the PlayBook, if they feel that it is a comparable product to the iPad . For loyal Apple customers, the lower prices would not be sufficient to lure them away. We can use this question to tie-back to the concept of value and customer loyalty. Example answer: The main factors that may have affected RIM’s decision include (1) that it was one year late entering the market, (2) the excitement for the device was not there compared to the iPad, (3) Apple had already sold over 20 million iPads and it was seen as the market leader, (4) the PlayBook was seen as follower but not with the same features and benefits, e.g. the number of Apps for the iPad far exceeded that of the PlayBook, (5) it was an attempt to protect its enterprise market from competition from Apple, and (6) the PlayBook was viewed by the market as an incomplete product that was rushed to the market. Media reports suggest that the launch of the PlayBook was low-key. Why do you think RIM opted for a low-key launch? Do you think this strategy was appropriate, or should RIM have tried to create greater buzz? Happy Planet's website demonstrates how the company delivers value beyond traditional grocery retailers in several ways: 1. Transparency and Storytelling: The website provides extensive information about the company's mission, values, and commitment to sustainability. It tells the story behind the brand, including its origins, founders, and the journey of its products from farm to bottle. This transparency helps consumers connect with the brand on a deeper level and understand the value of choosing Happy Planet over other options. 2. Quality and Organic Commitment: Happy Planet emphasizes its dedication to using high-quality, organic ingredients in its juices. This commitment to organic farming practices and sourcing sustainable ingredients sets it apart from conventional juice brands found in grocery stores. The website showcases certifications and partnerships with organic farming organizations, reinforcing the brand's credibility and trustworthiness. 3. Product Variety and Innovation: The website showcases Happy Planet's diverse range of juice flavors and product offerings, including juices, smoothies, and functional beverages. The company regularly introduces new flavors and innovative products, keeping its offerings fresh and appealing to consumers seeking variety and novelty. 4. Health and Wellness Focus: Happy Planet positions its products as not only delicious but also nutritious and health-promoting. The website provides detailed nutritional information for each product, highlighting the natural goodness of fruits and vegetables used in its juices. Additionally, the company offers resources and articles on health and wellness topics, positioning itself as a trusted authority in the organic beverage space. 5. Engagement and Community Building: Happy Planet's website fosters a sense of community among its customers through interactive features such as recipes, blog posts, and social media integration. Customers can share their experiences with Happy Planet products and connect with like-minded individuals who share an interest in organic living and sustainability. Overall, Happy Planet's website effectively communicates the value proposition of the brand by emphasizing its commitment to quality, sustainability, health, and community engagement. By highlighting these aspects, the company differentiates itself from traditional grocery retailers and positions itself as a leading player in the organic beverage market. Instructor’s Notes: This question asks students to think about the importance of a company’s launch (marketing communications) strategy for this type of product. RIM’s main competitor, Apple, launched its products including the iPad with much fanfare and hype, which generated a lot of publicity and media attention. The reason for RIM’s approach is not clear but we can speculate that much of it is based on the factors listed in the previous question. Regarding whether RIM should have tried to create buzz, the answers may vary widely but some students may venture that RIM knew that the PlayBook was not a superior product to the iPad or because it was not targeted to consumers but enterprise customers and thus, there was no need to create hype among the consumer segment. Example answer: RIM may have chosen this strategy for several reasons including: (1) that the device was targeted to existing enterprise consumers or BlackBerry users and therefore, there is no need to create hype, (2) it has traditionally not tried to create hype for its product launch and so it sees no need to change that, (3) that it has very limited Apps for consumers and if they raise expectations too high, they may create too many unsatisfied consumers. Was it an appropriate strategy? This is question for debate. What marketing strategies could RIM use to expand its customer base? The Montreal Biodome offers a unique and immersive experience that creates significant value for its patrons through several key aspects: 1. Diverse Collection: The Biodome houses a diverse collection of plants and animals from four distinct ecosystems found in the Americas: the Tropical Rainforest, the Laurentian Maple Forest, the Gulf of St. Lawrence, and the Sub-Antarctic Islands. This diversity allows visitors to explore and learn about a wide range of habitats and species in one location. 2. Educational Programs: The Biodome offers a variety of educational programs and interactive exhibits aimed at both children and adults. These programs provide valuable learning opportunities about ecology, biodiversity, and conservation, fostering an appreciation for the natural world and promoting environmental stewardship. 3. Conservation Efforts: The Biodome is actively involved in conservation efforts, including research projects and breeding programs aimed at preserving endangered species. By highlighting these efforts, the Biodome inspires visitors to become advocates for conservation and to take action to protect the planet's biodiversity. 4. Cultural Events: In addition to its scientific offerings, the Biodome hosts cultural events and exhibitions that celebrate the rich diversity of life on Earth. These events often feature collaborations with local artists and organizations, enriching the visitor experience and fostering a sense of community engagement. 5. Interactive Exhibits: The Biodome features interactive exhibits that engage visitors through hands-on experiences, such as feeding sessions, behind-the-scenes tours, and interactive displays. These exhibits not only entertain but also educate visitors about the interconnectedness of ecosystems and the importance of conservation. 6. Accessibility and Inclusivity: The Biodome strives to be accessible and inclusive to all visitors, offering accommodations for individuals with disabilities and providing multilingual signage and guided tours. This commitment to accessibility ensures that everyone can enjoy and benefit from the Biodome's offerings. Overall, the Montreal Biodome creates value for its patrons by offering a captivating and educational experience that fosters appreciation for the natural world, promotes conservation efforts, and celebrates biodiversity and cultural diversity. Instructor’s Notes: This question asks students to think about the various strategies and tactics RIM could use to increase its customer base, basically, selling more to its existing enterprise customers and targeting retail (individual) consumers. Students’ answers are likely to vary quite a bit but they should all relate to market penetration and market development strategies described in chapter 2. Example answer: In terms of market development, RIM should pursue more aggressively the consumer market by positioning its PlayBook as a device for this segment. This market segment is growing and RIM’s presence is weak, thus this could be an opportunity for RIM. For its existing retail consumers, it can play up the additional capabilities of the PlayBook with the BlackBerry, showing the improved functionality and performance. It may be able to use these customers as a base to further penetrate the consumer market. In terms of penetration of its enterprise market, RIM should position the PlayBook as a natural extension to the BlackBerry with much greater functionality, flexibility, and seamless integration through its tethering function. Which features of the PlayBook offer the most value to customers and its partners (e.g., advertisers)? The PlayBook offers several features that provide significant value to both customers and partners, including advertisers: 1. Interactive Content: The PlayBook allows for the creation of interactive and engaging content, which is highly appealing to customers. Interactive elements such as quizzes, polls, and clickable links enhance user engagement and provide a richer experience. 2. Targeted Advertising: For advertisers, the ability to target specific demographics and audiences within the PlayBook platform is invaluable. Through data analytics and user insights, advertisers can tailor their advertisements to reach the most relevant audience, increasing the effectiveness of their campaigns. 3. Analytics and Insights: The PlayBook provides detailed analytics and insights into user behavior and engagement metrics. This data is valuable for both customers and partners, as it allows them to track the performance of their content and campaigns, identify trends, and make data-driven decisions to optimize their strategies. 4. Customization and Personalization: Customers appreciate personalized experiences, and the PlayBook allows for customization based on user preferences and interests. Partners can tailor their content and advertisements to specific user segments, increasing relevance and engagement. 5. Collaborative Features: The PlayBook facilitates collaboration between customers and partners, allowing for the creation of co-branded content, sponsored events, and other joint initiatives. This collaborative approach adds value to both parties by leveraging each other's strengths and resources. Overall, the PlayBook's combination of interactive content, targeted advertising, analytics, customization, and collaboration features offers significant value to both customers and partners, making it a powerful platform for engagement and monetization. Instructor’s Notes: This question asks students to think specific features that are targeted to specific customer segments and partners. The market can be broadly segmented into two groups – business or enterprise users and retail or individual consumers. Students’ perceptions of the benefits may vary. For RIM’s partners, the PlayBook offers them higher margin than the iPad. Example answer: For consumers, the PlayBook offers compatibility with Google’s Android, which means consumers can have access to a far larger set of apps that RIM currently offers for the PlayBook. The multi-media (flash) capability of the PlayBook is also a feature that is not on the iPad but which many retail consumers use extensively. For enterprise consumers, flash and presentation capabilities, its smaller size, and its ability to serve as an extension to the BlackBerry are all features that offer value to enterprise customers. RIM’s critics suggest that RIM has missed the emerging tablet trend because the PlayBook launched a year after the iPad, after almost 20 million iPads had already been sold. Why do you think RIM seems to have initially missed the emerging tablet trend? There are several reasons why RIM may have initially missed the emerging tablet trend: 1. Focus on BlackBerry: RIM was primarily focused on its BlackBerry smartphones, which were dominant in the market at the time. This focus might have led them to underestimate the potential of tablets and delay their entry into the market. 2. Internal Disagreements: There were reported internal disagreements within RIM about the direction of the company and whether to prioritize the development of a tablet. This indecision might have delayed the launch of the PlayBook. 3. Technical Challenges: Developing a competitive tablet requires significant resources and expertise in hardware and software development. RIM may have faced technical challenges in designing and manufacturing a tablet that could compete effectively with the iPad. 4. Market Perception: RIM might have underestimated the demand for tablets and the shift in consumer preferences away from traditional laptops and desktop computers. This misjudgment could have led them to delay the launch of the PlayBook. 5. Ecosystem and App Support: Apple had already established a robust ecosystem with the App Store for the iPad, while RIM was still building its ecosystem for the PlayBook. The lack of app support and ecosystem could have hindered the PlayBook's success in the market. Overall, a combination of factors such as a focus on smartphones, internal disagreements, technical challenges, misjudgment of market demand, and ecosystem limitations likely contributed to RIM initially missing the emerging tablet trend. Instructor’s Notes: This question ask students to think about how a very innovative, market-oriented company have missed such a huge trend. The answers may vary but should focus on issues such as complacency (RIM invented the smartphone and was the market leader from the inception and so it did feel pressured to do much), its focus on playing catch-up with the iPhone in the consumer segment, which it had neglected for years, and a lack of focus on product development – its focus was on developing incremental products - and its senior executives (the founders) were focusing on other goals such as wanting to purchase a hockey team. Example answer: RIM’s excessive focus on playing catch-up with the iPhone in the consumer market where it did not have a strong presence and where its initial foray did not go well. Also, it failed to conduct effective market research, which would have indicated that its enterprise customers could have benefitted significantly from offering a product that could extend its BlackBerry capability. Also, its failure to follow and understand technological trends. Do you think that the PlayBook will ever dethrone the iPad in the tablet market? If you were hired to engineer a strategy to dethrone the iPad, what would you do and why? While it's difficult to predict with certainty, the likelihood of the PlayBook dethroning the iPad in the tablet market seems low. The iPad has established itself as a dominant player in the tablet space, with a large user base, extensive app ecosystem, and strong brand recognition. However, that doesn't mean the PlayBook, or any other competitor, can't carve out a significant share of the market. If I were hired to engineer a strategy to dethrone the iPad, I would focus on several key areas: 1. Unique Selling Proposition (USP): The PlayBook would need a compelling USP that sets it apart from the iPad. Whether it's superior hardware features, innovative software capabilities, or unique integration with other devices and services, the PlayBook needs something that appeals to consumers and businesses alike. 2. Ecosystem Development: Building a robust ecosystem of apps, services, and accessories is crucial for competing with the iPad. This includes working closely with developers to ensure a wide range of high-quality apps are available for the PlayBook, as well as partnerships with content providers, accessory manufacturers, and other third-party vendors. 3. Price Competitiveness: Price is often a significant factor for consumers when choosing between tablets. While the PlayBook should offer competitive pricing, it's also essential to communicate the value proposition effectively, so consumers understand why the PlayBook is worth the investment. 4. Targeted Marketing and Branding: Understanding the target market and crafting a marketing strategy that resonates with them is vital. Whether it's emphasizing productivity features for business users, entertainment capabilities for consumers, or educational applications for students, the messaging should highlight how the PlayBook addresses specific needs and pain points. 5. Continuous Improvement: The tablet market is constantly evolving, with new technologies and trends emerging regularly. To remain competitive, the PlayBook needs to stay agile and responsive, continually iterating on hardware, software, and services to meet changing customer demands and preferences. Overall, dethroning the iPad would be a challenging task, but with a strategic approach that focuses on differentiation, ecosystem development, pricing, marketing, and continuous improvement, it's not impossible for the PlayBook or any other competitor to carve out a significant share of the tablet market. Instructor’s Notes: This question asks students to think about strategies and tactics to improve a company’s competitive position to such an extent that it can dethrone the current market leader. Most students will argue that the PlayBook will never be able to overtake the iPad but they can be challenged to propose strategies and tactics to increase its market share. The answer will vary widely. Example answer: Possible strategies and tactics may include (1) improving the number of Apps for the PlayBook, (2) provide substantially more features at lower price points, (3) increase its capabilities for enterprise customers, (4) engage in an aggressive marketing campaign, (5) launch subsequent versions of its PlayBook before the iPad in order to change the “follower” or “second place” perception of the market i.e. recapture the innovator perception, and (5) give more focus to the consumer segment where the buzz is – battle for the minds and hearts of consumers and where perception of market leader is reinforced. Video Activities Video: The Bottled Water Industry Learning Objective: LO 2 Page Number in Text: 8 Description: This video demonstrates how marketers have taken a widely available product which is free and have turned it into a product sought after by consumers by applying various marketing principles and tactics. It shows the value-based principles of marketing: satisfying consumers needs/wants while generating benefits for the firm. Key Words: bottled water; marketing mix; segments; social trends; advertising; marketing channels; and distribution. Activity: Ask students to select a simple product like carbonated drinks or energy drinks or energy bars. Now ask students to (1) identify what consumer needs and wants these products satisfy; (2) list the market segments their chosen product is targeted to; (3) list all the different versions (e.g. size, flavour) of their chosen product and the price associated with each version; (4) list the different types of advertising and promotions they have seen for their chosen product; (5) list all the different places where their chosen product is sold; and (6) list the factors that they think account for the success of their chosen product. here's an example of how students might approach this activity using energy drinks as the chosen product: 1. Identify Consumer Needs and Wants: • Energy drinks satisfy the need for increased energy, alertness, and improved focus. • Wants may include a convenient and portable energy boost, a variety of flavors to suit preferences, and potentially health benefits like improved performance or mental clarity. 2. List Market Segments: • Athletes and fitness enthusiasts seeking performance enhancement. • Students and young professionals looking for a quick energy boost. • Individuals with active lifestyles needing a pick-me-up during long drives or late-night shifts. 3. Different Versions and Prices: • Sizes: Regular cans (e.g., 250ml, 355ml), larger cans (e.g., 473ml, 591ml). • Flavors: Original, sugar-free, fruity flavors (e.g., berry, citrus). • Prices: Prices can vary widely depending on size and brand, ranging from $1.50 to $4.00 per can. 4. Types of Advertising and Promotions: • Television commercials showcasing energy boosts during workouts or study sessions. • Social media campaigns featuring endorsements from athletes or influencers. • Sponsorship of sports events, music festivals, or gaming tournaments. • Promotions like buy-one-get-one-free offers, discounts, or giveaways. 5. Places of Sale: • Convenience stores. • Grocery stores. • Gas stations. • Pharmacies. • Online retailers. 6. Factors for Success: • Effective marketing strategies targeting specific demographics, such as young adults and athletes. • Diverse product offerings catering to different preferences and needs (e.g., sugar-free options, different flavors). • Strategic placement in high-traffic areas and diverse distribution channels for easy accessibility. • Successful branding and association with energy, vitality, and performance. • Effective advertising campaigns highlighting benefits like increased energy and focus. This breakdown illustrates how energy drinks, like other consumer products, meet specific consumer needs and preferences while utilizing various marketing strategies to capture market share and achieve success. Solution Manual for Marketing Dhruv Grewal, Michael Levy, Shirley Lichti, Ajax Persaud 9780071320382, 9780070984929