NORTHWESTERH UNIVERSITY
KELLOGG GRADUATE SCHOOL OF MANAGEMENT
Updates April 1 2008
Marketing, COREProfessor Philip C. Zerrillo Ph.D.
Spring 2008Visiting Professor: Department of Marketing
Wieboldt hall room 270
Office Hrs 5-6:00 Tues and WedsPhone: (512) 923 9793
LecDateTopicAssignment
I. OVERVIEW
1)April-1-2Introduction(Overview of Marketing)
-Discussion of SyllabusGlossary of Marketing Terms
-Macro AnalysisRead Kotler, Chapters 1,
--Consumption TrendsLow tech marketing Math- HBS- Robert Dolan. Concept of marketing SkimNote on Consumer Demographics --History of Marketing Read Kotler Chapter 2-3
2)April 8-9Macro AnalysisKotler, Chapters 4,
Skim Consumer Demographic note
3)April 15-16Competitive analysis
--Competitive AnalysisBIC case
ForecastingRead Forecasting Handout
4)April 22-23Micro AnalysisKotler, Chapters 6 (Skim only), What Consumers Think Note on Consumer Information
--How Consumers Make DecisionsAmsdeer Corporation (prepare for discussion)
Kotler Chapter 5
Begin Segmentation
Market Segmentation, Target Market Selection, and Positioning (9-506-019
Diamonds in the Data mine (Loveman)
5)April 30-May1Segmentation-complete
Market researchRead Kotler Chapter 5
!!!!!Written Assignment:
HBS Bio Pure case
6)May 7-8 Building brands- PositioningKotler, Chapters 8
Brands and Brand Equity
Discussion case Oldsmobile
Read: Kotler 9&10
Begin PricingRead pricing Note (hand out)
Read- Strategy and tactics of price
7)May 14-15Channel StrategyStern and El Ansary Chapter 1&5
--Extraction to Consumption
Channels and trade promotionTrade promotions a call for a rational approach
Written Assignment Optical Distortions!!!!
8) May 21-22Exam
9)May 28-9 ChannelsWritten case: Pavichevich Brewing!!! Gray Markets Gray Markets in the United States
Competiong with Gray Markets Keirsa
HBS reading
10) Jun 4-5ServicesThe case of the complaining customer
HBS case
Nature and Purposes of the Course
This course deals with management of marketing functions in modern profit and nonprofit enterprises. The major purposes of this course include:
1. To analyze critically the task of marketing under contemporary conditions and to examine the major functions that comprise the marketing task.
2. To evaluate various types of policies that can be employed in guiding the marketing activity.
3. To develop an awareness of the major types of marketing problems faced by organizations, with emphasis on sound analytical approaches to effective decisions.
4. To learn a language that will allow you to communicate efficiently with other marketing professionals.
Materials
Required
Case Readings Packet
Text:
Kotler, P., and Keller Marketing Management: Analysis, Planning, and Control, ed., Englewood Cliffs, N.J.: Prentice-Hall, Inc., 2006.
Evaluation of Student Work
Each student will be evaluated on the following basis:
Written Cases (2 of 3)50%
Oral Participation15%
Mid-term/Final Exam35%
The cases will be worked on and graded as group projects. The Exam will be taken individually during the prescribed time noted on the syllabus. These will be closed book exams.
Class Sessions
Rather than merely rehashing concepts developed in the text, class sessions will be devoted to probing, extending, and applying the text material. It shall be assumed that students have read the text assignments before coming to class.
Notes in the case packet outline what is to be covered in class during specific weeks of the course. These notes also specify in greater detail students' required preparation for the particular week. It shall be assumed that students have examined the appropriate materials before coming to class and that students are prepared to discuss any issues raised in the case packet materials.
Class Discussion
Each student is expected to contribute to class discussion. To a substantial extent, the benefit students derive from the assignments is related to their willingness to expose their viewpoint to the critical judgment of the class. Do not be reluctant to voice your opinion. The student’s level of class participation will be used in large part to determine grades in the course as they represent 15% of the final Grade.
Written Cases
3 Written cases have been assigned (2 of the 3 must be written and submitted). These cases will be done in groups (as assigned by the MBA office). At the end of the course, you will have an opportunity to provide the instructor with feedback on your group's operation. An upper limit of 7 double-spaced typewritten pages (excluding appendices) has been set for written cases. A maximum, and there may be no reason even to approach this maximum, of 9 pages of appendices will be allowed per case write-up.
Prior to the due date for written cases, class time will be devoted to a discussion of issues regarding case preparation and analysis. Some preliminary remarks on case analysis are included at the end of this syllabus. Written cases are due electronically prior to the start of class on the day assigned.; none will be accepted late. You may also send these to the instructor via email .
It is intended that each student will receive the group grade for each assignment. Therefore, it is important to divide the work equitably.
Reading Cases
The remaining cases are to be read and analyzed. The instructor will call on class members to present and defend their recommendations regarding case issues.
Examination
The examination format will draw from some or all of the following types of questions:
i.Short-answer questions designed to assess students' knowledge of material developed in the course.
ii.Analysis of mini-cases, each of which describes a marketing situation. On the basis of data presented in the mini-case, students are asked to (a) make decisions with respect to several issues raised in the case, and (b) marshal support for the position advocated using theories, concepts, and analytical devices developed in the text and in class.
iii.Defining and explaining concepts discussed in the course and there usefulness to managers.
Adequate preparation for the exam may be achieved by (1) reading and studying all of the required assignments, (2) taking comprehensive class notes and reviewing them prior to the exam, and (3) devoting effort to the preparation and analysis of in-class cases, both written and "reading". Studying these cases will give you concrete examples of the final exam format.
Honor Code
The honor code will be applied to the course in the following manner: It is expected that all written and reading cases will be done on an individual and group analysis basis, without examining analyses done by out-of-group members in either the present or previous classes. The final exam will be held in class and it is to be done on an individual basis. No other previous exams should be examined or will be made available. Any violation of these guidelines constitutes a violation of the honor code and should be reported to the instructor.
Instructor/Student Interaction
If at any point during the course you have questions regarding the preparation of cases, exams, or other course-related issues, please do not hesitate to contact the instructor either by phone or in person. If scheduled office hours are inconvenient for you, contact the instructor after class to arrange an alternative time to meet.
CASE ANALYSIS
Strategic decision making entails coordinating seemingly unrelated facts so that they provide support for a particular course of action. The cases assigned are intended to give you practice in assembling data to support a decision. As is often the situation in actual practice, cases may hot have all the data you would like. Nevertheless, it is critical that you develop a reasoned plan of attack on the basis of the data available.
Preparing a case. In preparing an analysis, read through the case looking for the main problems that you will address. Develop a rationale for your belief that the problems identified are in fact problems. In addition, assemble the factual information presented in the case that addresses various problems.
Once you have assembled all the information provided, develop a framework for analysis. This framework should (1) identify problem areas, (2) provide evidence that indicates why the problem is a problem and the alternative ways it may be resolved, and (3) choose a course of action that you feel is based on the soundest assumptions. By following this strategy you will be able to develop an integrated analysis and you will avoid focusing on issues for which there is little data.
Writing up a case. In the formal write-up, use the following headings:
1. Purpose of the Report
State the purpose of the report. Specify the problems to be addressed in your analysis.
2. Recommendations
State the manner in which each of the problems you have identified should be resolved. In this section, only your recommendations should be given. Reasons for the recommendations should appear in the analysis.
3. Analysis
This is the heart of your report. It entails marshalling factual data which support your problem identification and your recommended course of action. In essence, it is the linkup between problem and recommendations.
For example, if the first issue you address in your analysis is the target audience, use target audience as a side heading. If the next issue is creative strategy, use it as a side heading.
4.Summary
Common Errors in Case Writing
1.Format outlined above is not followed. Subheadings are not used in the analysis section.;
2.Problem and Recommendation sections are too long. No more than half a page is generally needed for each of these sections. Use outline form and dot points throughout the written report. There is no need for complete prose. However, do not use shorthand that is unintelligible, even to you at some later point in time.
3.Focus centers on minor issues or issues for which there is little or no data. Let the case facts guide you to the selection of issues. If there is little or no data addressing an issue, don't dwell on it in your analysis.
4.Rehashing of case data. Assume the reader is familiar with the case. Present case data only when it is needed to support a line of reasoning you are developing. Don't summarize the case situation as a preamble to your analysis, and don't present case facts unless you are going to drive home a point with them.
5.Non-critical evaluation of case data. Before you sue evidence presented in the case, ask yourself if it was collected in a sound manner and whether it is relevant to the issue which you are addressing. This does not give you a license to eliminate all data. Rather, you want to qualify the conclusions you reach by evaluating the quality of the data on which a conclusion is based.
6.Failure to provide a rationale for eliminating unchosen alternatives. It is important to show that the recommended course of action is likely to deal effectively with the problems identified. It is equally important to provide a rationale for dismissing un-chosen alternative courses of action.
7.Failure to present analytical work in an understandable manner. When doing computations, be sure your presentation (usually in an appendix) is sufficiently detailed so the reader can replicate the analysis. This requires you to indicate where the data came from and show how it is analyzed.
Glossary:Terms we will encounter
Intermediaries- Any of the actors or firms which exist between the point of extraction or production and the point of consumption.
Cannibalization- we will often use this term to refer to a products capacity to "steal" or take sales from existing products. This term is generally used to discuss the cannibalization which may occur with your own existing products (generally not favorable), however it can also be used to discuss the ability to steal sales from competitor's products.
Vertical integration- Owning of more than one level of the firms involved in the channel. Example, when a grocery retailer opens their own warehouse to store their products in bulk before breaking them down to ship to their individual stores. The retailer has vertically integrated. Integration can be forward or backward. when a firm takes over the functions of intermediaries closer to the source of production or extraction they are integrating backward such as the grocery retailer has done. Forward integration entails performing functions closer to the end user.
Horizontal integration- Taking over of firms at the same level of the vertical system. Say, if an Apple Tree took over 7-11
SKU- Stock keeping unit- the smallest differentiable unit on the store-owner’s shelf. Example, a 12 oz. bottle of diet coke and a 12 oz. caffeine free diet coke are separate stock keeping units. A 16 oz bottle of diet coke also constitutes a separate SKU from the 12 oz.
SBU- Strategic business unit- these are business units that can benefit from separate planning, face specific competitors, and can be managed as contained profit centers. (see chapter 2 notes)
OEM's- Original equipment manufacturers- are firms who are involved in the manufacturing of the goods to be consumed. They sell their products under another person’s name. Ex, a large textile plant in Vietnam may produce OE (shirts) for brand owners such as Polo or Timberland.
Functions- are tasks performed by the entity being discussed. I will often talk about "performing functions" as a way of discussing the work to be performed by a business unit.
Outsourcing- This term is often used to discuss the firms decision to let another firm perform certain functions for them. That is when you "farm" work out you are outsourcing. An example might be the mail or copy room at your former employers. Very often their are companies that specialize in running these centers. Another example is in the auto industry, very often a manufacturer -such as Chrysler will allow another firm to build its chassis or engines -such as Mitsubishi. Or a brewer like Samuel Adams may contract brew at several locations throughout the U.S.
Piggybacking- This is where one firm (or SBU) uses the distribution channel of another firm (or SBU). In doing so the firms are often able to achieve an economy of scale in their distribution task. This is a very popular method of taking products internationally. Example DuPonts' Reveal Wrap is distributed by Colgate.
Slotting allowances- fees paid to the retailers to get your product carried on their shelves. Technically the fee is for the cost associated with shelving and racking fees associated with putting the product into your warehouse.
Forward buying on deal- This is a strategy often employed by retailers in an effort to take advantage of the manufacturers trade promotion. Example a case of coke normally sells for $8.00 at the retail level. The retailer generally pays $7.00 for the case. Coke decides to run a promotion to help the retailers build store traffic. So, for a limited time they offer coke at a price of $4.00 per case to the retailer with the agreement that during the promotion period the retailer will sell coke at a retail price of $4.99 per case. The retailers buy more of the product than they need for the promotion period and store it for future sale. This is the process of forward buying. The retailers can either use this to reduce the price to the consumer in the future and stimulate store traffic, customer loyalty etc. or they can sell coke at the regular $8.00 per case and reap artificially high returns.
Failure fees- Retailers often request that a manufacturer guarantee them a specified return on their shelf space. To insure that they do not lose money when a new product introduction is a flop, retailers may mandate a failure fee.
Channel captain- This refers to a firm that acts as the leader or key decision maker for a products distribution channel.
Channel diplomat- A firm which acts as peace keeper or attempts to settle channel conflicts. They may or may not be the channel captain.
Penetration strategy- when a company tries to get mass acceptance or trial of their product. Example if firm X looks at the market and decides "if we price our product at $100 we will probably sell 20,000 units or if we sell at $25 we can sell 80,000 units. if they choose the later price they are looking to penetrate a greater portion of the market- hence a penetration strategy.
Skimming Strategy- when a company attempts to collect high rents from a small segment. If the firm above priced at $100 they would in effect be employing a skimming strategy. (we will discuss the rationale and implications for these in class)
Mix variables- This refers to the elements of the marketing mix (product, place, promotion and price)