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Week 1 Overview

Principles of Marketing

MRKT 310

Welcome to Week 1 of Principles of Marketing at UMUC. My name is Catherine Campbell, the chair of this course, and a Collegiate Faculty Member. Your faculty has asked me to prepare these weekly overviews for you to scan before you dive into each of the next eight week. The overviews will give you a glimpse of the marketing concepts important for this week. Be sure to post your questions and concerns in the weekly discussion forums should you find anything in these overviews or the course content confusing or for which you would like a little more clarification.

Author (A) - Welcome to Principles of Marketing. I’m Catherine Campbell, the course chair, and your faculty has asked me to prepare these weekly overviews to accompany the course content. So it will be my voice you hear each and every week for the next eight weeks as together we explore the field of marketing.

Getting Started

A few tasks before we begin

If you are new to LEO, take the tour and review the tutorials so that you are comfortable with the learning platform. Be sure you understand where to find the due dates, the assignments, the learning activities and the weekly quizzes.

Ensure your technology is up to date for LEO

Introduce yourself in the LEO Discussion Forum

Carefully review the syllabus and ask any questions in the Syllabus Questions Discussion Forum

If you are a veteran learner here at UMUC, you know how important it is to prepare yourself to be successful. So, before we get into the nuts and bolts of marketing, take a few minutes to learn about LEO, explore the LEO classroom to see where you can find your syllabus, your assignments, your discussions and your quizzes. Mark down the due dates on your personal calendar, and if you are taking a hybrid course, clear your schedule to attend each of the eight weekly classes.

You may also find it useful to perform the system check to ensure your computer has all the requisite downloads to operate LEO properly.

Most importantly, be sure you have allocated enough time over the next eight weeks to study. The rule of thumb is approximately 6 hours per week, or two hours per credit hour, to sufficiently learn the material. For you it may be more or it may be less. Your faculty strongly suggests you do not wait until the weekend to get started, consistent attention to the material is your best course of action.

What is Strategic Marketing?

What’s important in Week 1

1.1 Define marketing

1.2 Explore who does marketing

1.3 Why study marketing

1.4 How marketing is done

1.5 The value proposition

1.6 Where strategic planning occurs within firms

1.7 Components of strategic planning process

1.8 Developing organizational objectives and formulating strategies

1.9 Strategic portfolio planning approach

Week 1 Course Content has nine sections. This is one of the longer weeks in terms of reading, but we cover some of the basics of what marketing is and how it is done — strategically. Hopefully you will find the course content easy to read and engaging. This presentation will continue with a short overview of each of the nine sections.

1.1 Defining Marketing

AMA definition: The activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large.

Download the video to hear how Philip Kotler, the guru of contemporary marketing thought, defines marketing.

Philip Kotler, S. C. Johnson Distinguished Professor

of International Marketing at the Kellogg School of Management

at Northwestern University. was the originator

of the Marketing Mix or the 4 p’s —Product, Price, Place and

promotion. Notice that he has now acknowledged there is more to

marketing than the four P’s to include the concepts of value creation,

communicating, delivering, and exchanging offerings, or as he

explains c-c-d-v-t-p. Create, communicate, deliver, value

to a target market at a profit. Copied under standard Youtube

license.

The course content talks about the definition of marketing as stated above. But I thought you might want to view a short video of Philip Kotler, a marketing expert and author of many textbooks on marketing. Take a second now to notice how even Dr. Kotler has evolved in his definition of marketing to be focused on creating value for customers.

Personal Value Equation

For every purchase we make or think about we formulate a personal value equation in our minds.

Value = Benefits received - [price + hassle]

Value is much more than the price, it includes what we think we will get, how much it costs in terms of money and time, how difficult will it be to attain the offering, what we give up to get the offering under consideration

Now that we know creating value is the main job of marketing, let’s take a look at how consumers define value. Carefully review the discussion on the personal value equation, and hopefully you will conclude that price is only one factor in how we as consumers view value. Unfortunately for marketers, different consumers can have different value equations making it difficult to send out a clear, consistent and compelling message that appeals to everyone in a target market.

1.2 Who Does Marketing?

For-profit companies

Nonprofit organizations

Individuals

And YOU

We will learn much more about target markets later, but the main point here is that marketing isn’t relegated to just mammoth large companies, although those are the ones we generally see advertise. All organizations are engaged in some form of marketing from the very sophisticated to the seat of the pants. Individuals like politicians market, and they call it a political campaign. And, don’t forget that you market yourself, as well, especially when going on job interviews.

1.3 Why Study Marketing?

Marketing enables profitable transactions to occur

Marketing delivers value

Marketing benefits society

Marketing costs money

Marketing offers people career opportunities

Perhaps the most obvious reason is that this course is required for your degree program. But beyond that, marketing activities generate a lot of positive things. Without marketing, there is little consumer choice, marketing gives consumers what we want, where we want it, it generates its own economy with its spending up and down the supply chain, and it offers some pretty interesting careers.

1.4 How is Marketing Done

Marketing gets done through strategic planning

Marketing begins with understanding the customer and what they need and want

Marketing Plan outlines all the objectives, and strategies and tactics for achieving those objectives

Marketing should be socially responsible and sustainable

Marketing gets done the same way any other business function gets done, through planning and implementation. The best marketing is part of a strategic planning process that focuses on the customer and is a company-wide effort involving more people than just marketers.

1.5 The Value Proposition

A value proposition is a statement of the benefits of the product or service offering and why it is superior to competing offers

How the customer sees your offering

Click on the video for a simple definition of value propositions.

How to create a Unique

Value Proposition, copied under

standardYoutube license

The graphics in course content outline the components of a strategic plan, but let’s focus on the value proposition here. It is important to remember that a value proposition is not what the company thinks of its products or services, but what the customer thinks of them. Take a moment to view this brief video with more information on the importance of a value proposition.

1.6 Where Strategic Planning Occurs within Firms

Should be a company-wide effort with significant support from top management

Larger, more diverse the company the more levels of planning involved

All the elements of the planning process need to be included

Three Levels

of Planning

Corporate Level

Business (SBU) level

Functional Level (marketing planning)

Some companies do strategic planning merely because the owner thinks of something and then does it. So, the smaller companies rarely engage in a three level planning process. But consider a multinational company like General Electric. To explain the levels, GE corporate determines how successful they want to company in total to be. But GE corporate is pretty far removed from the day to day operations of the company. That is relegated to their business units such as aircraft, appliances, medical equipment, etc. These strategic business units take the direction of the corporate level plan and internalize them for their own SBU’s. Then, each department within an SBU engages in the third level, or the functional level, and this is where you will find the strategic business plan in a multi national company.

1.7 Components of the strategic planning process

Situation analysis provides the inputs to the strategic planning process

Mission is the glue that focuses the strategic plan

Measurable objectives are critical to measuring the plan’s success/failure

Value proposition and strategy formulation begins the tactical part of the strategic plan

The course content will cover the concept of beginning with a customer focused mission statement in detail. What’s important here is that a strategic plan is only as good as the inputs as noted in the blue boxes. This can be an overlooked step in planning, but as the old adage says, put garbage in and you get garbage out. The course content will explain this further.

Swot Analysis

Notice the distinction of the four elements of a SWOT analysis.

Internal factors relate to what is happening inside the company.

External factors relate to what is happening outside the company.

One of the inputs to strategic planning is a SWOT analysis. This requires a lot of thought and a lot of data, both internal and external data. The main function of performing a SWOT analysis is to ensure that as the company plans to minimize its weaknesses and threats and maximizes its strengths and opportunities.

Competitive analysis

Three primary models for viewing competition

The competitive analysis is a key component of the value proposition in that it defines how your product or service offering differs from competitive offerings, or acknowledges the absence of competition.

Competitive Strategies

Michael Porter’s Five Forces Model

Treacy and Wierseman value propositions

Blue Ocean Strategy

Another important input is the competitive analysis. Pay attention to the competitive strategies outlined on the right in blue. The goal of any competitive analysis is to feed the value proposition, what offering can the company bring to market that is distinctive from competitive offerings and has value for customers. Even better is to bring to market something innovative that no one else can offer. That is rare, and if attained can be short lived, but is the holy grail of marketing.

1.8 Developing Organizational Objectives and Formulating Strategies

Objectives

Measurable

Reachable

Time specific

Strategies

How objectives will be accomplished

Even more specific with details of action plans

All this input must lead to some practical objectives and related strategies. Objectives that are too grandiose or beyond the scope of the organization’s resources are not useful. Companies may tend to use different terms or use these terms interchangeably, so be sure you understand the spirit of these terms so you can translate them into your own employer’s vernacular.

1.9 Strategic Portfolio Planning Approaches

Useful for multi-product or multi-division organizations

Thinks of each product or division as a separate business

Helps to make decisions with respect to what products or divisions should stay, be reinforced or eliminated

Two most common portfolio planning approaches

Boston Consulting Group matrix

General Electric Approach

Going back to our large companies, either because they have multiple SBU’s or multiple products, they need to decide the future of each of those SBU’s or products. They do this through portfolio analysis, or looking at the future market potential and the projected lifespan of the product category. The simplest of the

frameworks is the Boston Consulting Group Matrix. Take a look at it in the course content and the learning activity to fully understand its usefulness.

Week 1 Assessments Due

1. Discussion participation

2. Week 1 quiz

3. Academic Integrity Module

There is a lot to absorb in Week 1. Just know we will cover many of these topics in greater detail in subsequent weeks. Meanwhile, there are assessments each week and they are the same every week. While everything is due Sunday night, you are urged to spend time in the discussion forums early in the week, and once or twice during the week. You are also encouraged to take the weekly quiz last.

Questions or Comments?

Be sure to take advantage of the General Discussion topic in the Week 1 Discussion Forum to ask any questions, get clarifications, or otherwise seek the advice and assistance of your faculty member.

Each weekly discussion forum has a topic for you to post any of those questions you may have as you work through the material. And your faculty want to know what those questions are. We’ll ‘see’ you in class!