Class Questions

This week my questions came from a few different sources, and I'll go through them below.

The first one came from 'Deliver Extraordinary Customer service' as it discusses the use of technology to be able to understand customers better and be able to cater to their needs.  My question was what about the companies that cannot afford such high tech software as companies like Amazon (of course they are known for their incredible technology) or other large scale retailers.  Should smaller businesses try to compete with such large businesses on the technology scale or should they find their own ways to wow the customer?  I think that to an extent companies need to keep up with the times of technology, but some companies will not be able to offer the same level of technology. 

The latest new tech idea I have seen is Lowe's where they are now storing past purchases.  I think this is a great idea because I always go in there with a lightbulb and try to match it up in the aisle every time one burns out - this would make this easier for me.  Although this is an incredible idea, I don't believe some of the smaller hardware stores will be able to compete with Lowe's on this level.

My second question came from 'Consumer Insight - Moment of Truth' that discussed customer movement throughout the store.  I was wondering if anyone else thinks there may be stores tracking who is currently shopping and sending along coupons as customers are shopping in their stores.  This could be used to bring customers potentially from one side of the store to the other as they are in there, and also lead to impulse purchases because they just received a 'good deal' in their email.  I think apps like FourSquare are already beginning with this idea where people can check in where they are and get a free appetizer at the restaurant they are in or something similar.  Actually this relates a lot to my first question with the use of technology to get more spending.

And my last question came from 'Analysis from marketing planning'.  There is a lot of detail about information collection and how companies can use it.  We use focus groups at the company I work for so my question was whether anyone thought that focus groups are more skewed toward in a company's favor if it takes place on company grounds as opposed to a more neutral location.  I would think that I would feel more amiable toward a product if I was at the company's headquarters (if they were nice) than compared to getting asked about random products in somewhere like a mall.  Does anyone else think that it would have an impact on them?

Class Discussions

We briefly talked in class about loyalty programs and I just wanted to comment on that here.  I think that most consumers that use loyalty programs regularly have high expectations for these programs.  I know we have gotten some feedback that older loyalty users want more than new users as they feel like they have been loyal to the loyalty program right along and want to make sure they are getting all the benefits for that.  When new users get similar offers, more consistent users become more unhappy.  These loyalty programs seem to be about striking a balance between 'insider offers' and brand loyalty.

Another topic was purchases that you did not intend to buy.  This immediately lead me to think of Groupon.  I'm sure everyone has heard about this, but if not check out www.groupon.com  to find deals in your area.  Many times there are things you don't need at all but you can get it for half off!!  There seem to also be more and more sites like this that keep popping up to get customers to purchase quick - there is a time limit - and on the impulse of a sale rather than thinking about it.

Pharmasim

This week I added a new product to my line!  I decided on the 12-hour cold capsule to add.  I used the report 'Symptoms reported' to see what lead people to buy cold medicine.  I also looked at the report 'Brand Formulations' to check and see if the market was already saturated with 12-hour cold medicines.  There was really only one other capsule like this (Extra) so I decided to go for it.  I moved some point-of-purchase and coupon promotion money from my regular product to this new one and added advertising to most consumers.  Unfortunately, I did not see the best results to the new period where my stock price dropped by about $3.  I'm wondering if this product was competing with my original product and maybe should have picked something completely different like a child medicine to avoid that. 

Week 3 Blog

Questions for Class

One of my class questions this week related to defining competitors.  Due to the economic fluctuations in recent years this lead to me ask whether or not this would impact the overall amount of competitors that should be considered.  If there is less spending money available by consumers, should more competitors be considered?  In my opinion, this would have an impact.  Rather than just potentially reviewing direct competitors, people may be more likely to substitute your product for indirect competitors.  In class we discussed the reduction in cable due to less money available, not necessarily because cable was substituted with something else like satellite, but could have been substituted for unrelated objects like groceries.  If consumers are spending less, they may have to make more product substitutions overall.

My next question was actually related to the first one.  There was a picture of a De Beers diamond ad shown below - noting to 'Redo the Kitchen Next year'.

I can see the intention of the ad, but I have to say this simply reminded me that those diamonds are as much as re-doing my kitchen.  Seeing this ad would make me change my mind about the potential impulse purchase of new diamonds.  Does anyone else agree that potentially calling out an opportunity cost in an advertisement may lead people to think more about the other ways they could be spending their money?

Prompts from Class

One class discussion included the idea of whether the customer or company determines the competition.  I would have to say that the customer is the overall decision maker related to competitors - especially noting the question paragraphs discussed above.  I believe our Drucker reading supports this theory in that he makes the point that marketing in general is customer driven.  Companies could look at any competitors they wish for comparison, but that doesn't necessarily mean they are picking the competitors that customers are choosing between with their products.

Another discussion focused on ethics.  There is a definitely a line between ethical and unethical competitor analysis.  I have heard stories of people getting fired from a job due to crossing this line.  Trying to secretly sneak information from a competitor was enough for his company to let him go as they did not want to be even remotely associated with this type of behavior.  The Analysis book mentions becoming a stockholder in your competitor to gain inside information.  Although I don't believe this is illegal, I don't believe it's ethical.  As a stockholder you have a partial say in the organization and it just doesn't seem appropriate to have a say in a competitor as that could lead to potential sabotage.

Pharmasim

I looked at two reports this week.  One report was 'Promotion Activity' which showed how much each company is spending on different types of promotional activities, including co-op, samples, point-of-purchase, and coupons.  Next I looked at the report 'Purchase Intentions'.  This report showed which product consumers intended to purchase when they arrived and then which product they actually purchased.  By looking at these reports together, it was easy to see that ALL companies that had increased percentage from the intention to purchase to actually purchased offered free samples.  This lead me to the conclusion that sample offers helped influence purchases over original intentions. 

WSJ Article

I saw this article flipping through WSJ online and it made me think of this class.  I'm not sure if you need to be a subscriber to see the article, but the link is below.

http://online.wsj.com/article/SB10001424127887324345804578423081955213990.html?mod=wsj_cfohome_midLatest

All in all it explains what a rough situation JC Penney is in.  They had tried that new campaign over the last year or so where they were just going to offer their lowest prices and not send out coupons or have big sales.  It may have sounded like a good idea, but now it sounds like they are reverting back to their original plan.  It seems like they didn't consider that many times the consumers want to feel like they are getting a bargain somehow.  If it's the same price all the time there is no incentive to act immediately to get that extra special deal or sale price.  I love when I open the secret Kohls coupon and get the 30% off one - the coupon makes me consider what I may need to buy or could by at Kohls.  It keeps that reminder in the back of the consumer mind.  Interesting to see that JC Penneys may be reverting back to this method after making such a big marketing campaign about how they are not going to do this and offer low prices everyday... 

Week 2

Questions up for Discussion

One questions I had this week came from 'Analysis for Marketing Planning' and addressed the question of who is part of the 'buying market'.  In the book it says that children should be removed from the 'buying market'.  Maybe because I work for a toy company or maybe it's because I've seen Saturday morning cartoon commercials, but I disagree with this statement.  I think children are one of the biggest influencers of the buying market.  Maybe they aren't necessarily the ones going to pay for the product  (although more and more younger kids seems to be asking for gift cards to make their own toy purchase decisions) they are the ones that are picking out the toys they want.  After growing up in an age of the Furby, Tomagatchi, and Tickle-me-Elmo I can hardly imagine that kids should be removed from consideration in the 'buying market'.

Another question I had this week was addressed in class, and it looked like I was not the only one that had considered this scenario.  It appears that Drucker takes the stance that decisions should not solely focus on analytical/numerical analysis.  He makes the point that if there is something that cannot be put into numbers if has to be considered outside of the analysis, which I agree with.  The part I did not like in the book was that all examples he choose to use to support the theory that numerical analysis does not generally work were examples where the supporting information was incorrect.  In the case that the appropriate evidence was used to do the analysis it may have worked, but just because the assumptions were wrong does not make the idea of numerical analysis wrong.  Maybe it's because I'm an accountant, but I like the numbers that tell me a story.  It would actually make me think that more considerations should have been made prior to the analysis.  I used the example of 'Moneyball' in my posed questions as this was choosing players solely on statistical evidence and not looking at how good they look throwing a ball.  Although as someone who doesn't mind watching cute guys play sports, I support the latter theory as well.

Prompts

In the class activites there have been prompted discussion points and I'd like to address a few of those here.  First, we discussed how our own companies market to us as employees.  I don't work for a public company so I'm not going to announce where I work here, but I think most companies market to their employees.  We constantly receive information and news headlines on our intranet site with the latest developments.  We are encouraged to follow the cultures of our company.  We are in so many countries that individual cultures are addressed (we have a website that has general explanations about what to do and how to do it when traveling), as well as the general company culture.  We have quarterly update meetings with the whole site where it is announced how we are doing, what our strategy is, and future plans for growth and achievements.  There is a natural sense of pride at my company so I think not only does the marketing work, but our products speak for themselves in getting employees to stand behind it.  Our company leaders are definitely marketers.  I would say that the president of the US operations of our company meets all 8 of Druckers marketing/leadership principles. 

Another discussion was related to the view of growth being stopped or slowed is due to the failure of management per the article this week.  I do mostly agree with this assumption.  It is up to management to make decisions on behalf of a company to keep it thriving.  An example that comes to mind here is a real estate company I worked for.  In the earlier years of the company there were many conventional real estate sales where there were ordinary people buying and selling their homes.  Well over the past decade that had changed into bank foreclosures and banks selling homes to new buyers, with very limited conventional sales.  The company switched it strategy, reached out to banks, and became to list homes onto the housing market for the banks directly.  Had they focused solely on conventional listings, the company may not have thrived during a time when the housing market was in turmoil. 

Relating this class to my own career

I have a more personal discussion this week in addition to the prompts and questions from class.  I went to a gift card seminar in sunny Orlando, FL where I learned all about marketing gift cards.  I wanted to add a note here as it related to class that one of the presentations was about a customer survey that was done where 12 people went to 48 different stores and gave feedback about their gift cards.  Where they could find them in the store, whether there was packaging available, whether the associates helped them, and whether there were enough designs to choose from.  From this I learned that customers want more options!!  From the survey it was easy to see what the consumer wanted so learning my lesson from this experience, I will be back at work pushing our gift card program to our marketing department as it is in the consumers best interest and needs. 

Pharmacism

This week I reviewed the market report "Industry Outlook".  This report explains population rate, industry growth, and inflation.  These would be helpful to be aware of as a comparison.  If inflation is rising a lot, should be consider raising the price of the product to coincide or lower it so people may still be able to afford it with everything else on the rise?  We can use industry growth as a comparison point for our own growth - it should be at least consistent with industry norms.  Population growth wouldn't be as good to know as industry growth, but I would generally believe that these two would be correlated. 

This report also shows the costs associated with sales force and marketing research and the distribution between the various types of costs.  We can use this to see if there are any areas that are significantly lower or higher than others to determine where we can adjust costs. 

This week I also tried out some additional changes.  I increased in the grocery store sales force and the related co-op, and decreased the convenience store co-op.  I made these decisions based on the buying channels and the consideration that most people shop for cold remedies at grocery stores and few actually get them at convenience stores.  I slightly increased co-op advertising in general and POP advertising to see what that would do.  My net income went down over the previous period.  These decisions did not work as well for me as my consumer-based approach that I took last week. 

Marketing Simulation

Pharmasim Simulation

Trying out the Pharmasim Simulation for the first time this week has been an interesting experience.  I decided that I wanted to add the trial size samples to the marketing mix since personally as a consumer I like to try out products before purchasing them if possible.  In addition to that I decided to change the advertisement message.  Also just using my reference as a consumer, I don't like commercials that trash the competitor the whole time, and I think that repeating the name of the product helps me remember what the commercial is for.  So I increased some of the primary and reminder areas and decreased the comparison portion.  I decided that was all I would change for the first time around and advanced to the next section.

Overall I had good results with these decisions.  Net income and my stock price went up significantly.  This leads me to believe that by taking the consumer point of view in making those decisions I was able to make realistic effective changes.  For the next time around I think I'm going to focus more on changes between the product and the retailers and wholesalers that sell it for us.  We'll see how that goes next week!

What marketing is all about

What marketing is about

I thought this was a great article related to what we have discussed and read for this class.  It includes information about the use of consumer information for marketing and the benefits.  It also differentiates between marketing departments and sales departments. 

One of my questions this week was related to the difference between sales and marketing in informercials.  I think this article helps answer that question.  It's the marketing department that works on what a consumer would be interested in, and also may determine that an infomercial may be the best method to use to get the product out to consumers.  It's later the sales person in the infomercial that is portraying the message the marketers have researched.  Therefore I now believe that what I had thought was simply a sales pitch for products people don't actually need or want, may be more in depth with marketing behind the scenes. 

Another questions I had come up with this week was related to changes in marketing methods.  When Sears, Roebuck had begun to give customers the opportunity to purchase multiple types of products in one place - one of the beginnings of the department store - this changed marketing methods for customers completely.  Now, it seems that so many department stores have taken over, that the strategy has almost begun to revert back to specialty stores becoming more popular.  We discussed in class that these specialty stores now seem more high end and employees of them provide more expertise and customer service.  There is more to the customer experience than in department stores.  So one highly regarding marketing strategy in the past has been used so much that there has become benefits to going back to the original method of separate stores of specific items.

My last question of the week related to product limitations.  It seems that Druckers view on marketing is related to ethically supplying society with what people want and need.  Now when some companies will purposely supply less than people want to increase demand and make items "specialty" or "exclusive", this seems to go almost go against that definition of marketing.  I'd be curious to get some feedback on whether others would consider this a marketing technique.  Some examples I would say would be the original Furby or the infamous Tickle-me-Elmo doll.  By not supplying the customers with the product (whether intentionally or not) the products and companies get extra publicity and attention due to the demand that could not be met.