Summary
Summary Theories of Marketing
- Course
- Institution
Summary of the mandatory lecture clips of Theories of Marketing, including a short summary of all articles.
[Show more]
Seller
Follow
victorroos32
Reviews received
Content preview
Theories of Marketing – Master BASummary
Victor Roos
Content
Topic Page
Introduction 2
§1 Developments in marketing thinking 5
§2 Value equity and innovation 11
§3 Brand and relationship equity 21
§4 Consumer insights and motivations 31
§5 Consumer behavior 41
§1 - §3 discuss marketing strategy and §4 - §5 discuss consumer behavior. Marketing strategy was
discussed in week 1, 3 and 5, while consumer behavior was discussed in week 2 and 4.
Learning objectives
This course aims to provide students with an overview of the basic theories and their development
over time in the two main marketing interest areas: Understanding consumer behavior and crafting
successful marketing strategies. Marking tactics are a result of these two main marketing domains
that should be understood fully before tactical decisions can be made that are not only effective on
the short term. The course serves as the academic background for the rest of the marketing track
and aims to inspire students to think about their own research interests in marketing, relevant for
their thesis later in the master’s program.
Exam
- Show understanding of the concepts and their underlaying relationships
- Break down questions to make it easier for yourself and things are not confused.
- Types of questions:
o Reproduction: ‘What are the three factors that influence X?’
o Understanding, reflection: ‘What does it mean?’, ‘Explain in your own words the
concept X?’
o Understanding, application: ‘Does CEM conflict with the network paradigm?’, ‘What
is the link between consumer insights and motivations?’
o Think of reading questions for each week or main issues that were discussed in class
- Use the lecture clips as guide: if it is emphasized in the clips, you should probably know it.
Then read the articles and compare articles on the same topic. Examples of these
comparisons can be found in the clips.
,Theories of Marketing – Master BA – Summary
Introduction
Dolan article
In 1985, marketing was defined as the process of planning and executing conception, pricing,
promotion and distribution of goods, ideas and services to create exchanges that satisfy individual
and organizational goals. However, in 2012 it has shifted to the following definition: Marketing is 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. It has shifted from a
transaction and product-driven definition to a relation and value-driven definition.
Dolan article
Framework for marketing strategy formation
Dolan, 2014
According to Levitt, the purpose of a business is to create and keep a customer. He also noted that
achieving those goals requires differentiating what you do and how you operate. Shaprio developed
a framework that helps understanding how to do that:
1. Marketing strategy formation: set the overall long-term goals and basic approach to the
marketplace. This usually involves making choices about specific customer groups to serve,
customer wants to address, and the best way to create value for customers.
2. Marketing planning: the time horizon varies per industry; in dynamic situations more
regularly, while in more stable situations, the basics of a play might extend over 2-3 years.
3. Programming, allocating, and budgeting: set near-term objectives and detailed plans (usually
one year), including how resources will be allocated to the necessary activities.
4. Implementation: execute the programs specified in step 3.
5. Monitoring and auditing: evaluate results against goals and develop corrective action plans.
6. Analysis and research: gather data from inside and outside the company to support the four
action steps (1-4). This data gathering should occur before executing each of the first four
steps and should be ongoing.
2
Victor Roos
,Theories of Marketing – Master BA – Summary
A key point is that winning the sustainable differentiation contest, and doing so in a way that yields
revenues, covers costs, and contributes profits, is no simple task. Most new products do not find a
way to do so and often fail before they even get to market. Organizations must recognize that they
do not necessarily need to create a mass-market product loved by everyone: focus is key. Marketing
strategy is about the process of selecting customers, deciding on the competitive point of
differentiation to present them, and developing a plan for reaching those customers.
There is no one standard way to market a product or service effectively; organizations often adapt
different strategies for their different offerings. The approach must be tailored to the particular
circumstances. These marketing approaches may also change over time (e.g. Samsung: low-cost →
top-quality). Customer differences (in what they value in a product or service, how they want to buy,
and how they trade off price vs. benefits) mean that some customers more naturally fit in the
capabilities and aspirations of a given company. Dolan acknowledges that there is more than one
way to go to the market, he presents a framework that can be used to develop a marketing strategy.
In this framework there are three interrelated elements in the marketing strategy formation process:
analysis, decisions, and outcomes. The aspiration decision (what value does the product represent to
what kind of customer) specifies what the firm hopes to achieve in the market. The action plan
decision consists of two elements: value creating and value capturing. The value created through the
first three P’s is the upper bound on the price the company can charge and still attract a customer.
Companies aspire to create value, such that this upper bound on the price which can be charged is
greater than the unit cost of producing the value. Before making these decisions, an organization
needs to analyze the market in order to make good aspiration and action plan decisions. This usually
requires an analysis of the five C’s. the decisions made will determine what the outcomes will be and
how successful the company will be at acquiring the customer, retaining the customer, and making
the customer a brand ambassadors.
The 5 C’s
- Customer behavior: in customer analysis, one tries to understand how potential customers
make a purchase decision in a product category. The first question is, who is involved in the
decision: an individual or a group? This is called the decision-making unit (DMU). Once this is
specified, the analysis turns to understanding the decision-making process (DMP). Focus
groups or surveys are often useful. The key is to understand the buying criteria of the
targeted segment to ensure the fit of the firm’s offerings to the target market’s wants: a
product/market fit. When trying to determine the DUM, a marketeer should ask itself the
3
Victor Roos
, Theories of Marketing – Master BA – Summary
question who the participants are in the buying process and what role does each play.
Bonoma set out six major roles generally played across a broad set of buying situations:
o Initiations: they recognize the value of solving a particular issue, so they stimulate
the search for a product.
o Gatekeepers: they act as problem or product experts and control information and
access to other members of the DMU.
o Deciders: they make the purchasing decision.
o Influencers: although they do not make the final decisions, they have input into it.
o Purchasers: they consummate the transaction.
o Users: the consume the product.
- Company analysis: the company’s strengths and weaknesses. Generally, assessing a
product/company fit requires an understanding of the firm’s finances, R&D capability,
manufacturing capability, and other assets. Prahalad & Hamel describe this as a company’s
core competency. There are two key elements to core components: (1) to make a significant
contribution to the creation of perceived customer value in products, and (2) to be difficult
for competitors to imitate.
- Collaborator analysis: this involves analyzing the set of external assets that may be accessed
to complement those of the company, e.g. money.
- Competitive analysis: winning the customer acquisition game requires creating more value
(benefits minus costs) for customers than any other options known to them. Therefore, a
firm must identify who its competitors are now and who they are likely to be in the future. A
competitive analysis requires assessing others’ offerings, the market they address, how they
address it, and how all that will evolve over time. Such an analysis must begin with a
fundamental understanding of its strengths and weaknesses.
- Context analysis: a good marketing strategy takes very little for granted. The context shapes
what is possible, and the context is always changing. An example is the disruption that
technology (especially the internet) has brough to existing business practices. A context such
as culture can shift quickly and bring surprises unless it is carefully monitored. The systematic
analysis of cultural trends is increasingly an integral part of marketing strategy formation.
Each of the five C’s is critical, but in marketing, the C of customers is the most important:
understanding their preferences and perceptions, and how they make decisions. Devising an
effective marketing program requires deep analysis to support decision making on a host of
interrelated issues.
In the article, examples are given about Peloton (this might be useful when learning for the exam).
4
Victor Roos
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller victorroos32. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $7.54. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
56326 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy study notes for 14 years now