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Part 1：Customer Focus and Marketing Management1

1 THE CONCEPT OF MARKETING1

The Marketing Concept6

ILLUSTRATION：AT＆T7

Different Organizational Philosophies7

What Is Customer Orientation？9

An Alternative Perspective11

The Changing Nature of Marketing14

The Increased Adoption of Information Technology14

The Rapid Commercialization of the Internet16

The Continued Globalization of Business19

The Value of the Customer Base21

The Focus of This Book22

Executive Summary23

Chapter Questions23

Further Reading24

2 THE MARKETING MANAGER’S JOB25

The Job of the Marketing Manager27

ILLUSTRATION：Motorola32

The Marketing Plan32

ILLUSTRATION：Cadillac35

The Lessons38

Introduction to the Integrated Case40

Executive Summary44

Chapter Questions44

Further Reading44

Part 2：The Development of a Marketing Strategy45

3 A STRATEGIC MARKETING FRAMEWORK45

Complete Marketing Strategy46

Objectives48

Strategic Alternatives，Customer Targets，and Competitor Targets49

Product Features51

The Core Strategy：Competitive Advantage52

Product Positioning62

ILLUSTRATION：Metaxa64

The Value Proposition64

Marketing Strategies over the Product Life Cycle65

Strategies for the Introductory Phase66

Growth Strategies67

Strategies for Maturity68

Strategies for Decline69

Product Line Strategy69

Executive Summary72

Chapter Questions72

Integrated Case Application Exercises：Developing Marketing Strategy in the Personal Computer Industry73

Further Reading73

4 MARKETING RESEARCH75

The Research Process79

Secondary Data Sources81

Internal81

External82

Primary Data Sources87

Informal87

Qualitative Research88

Observations91

Surveys91

Panels93

Experiments94

Models and Simulations96

Market Potential and Sales Forecasting96

Market Potential96

Forecasting98

A Tip103

Executive Summary103

Chapter Questions104

Integrated Case Application Exercises：Marketing Research in the Personal Computer Industry104

Further Reading105

5 CONSUMER BEHAVIOR AND ANALYSIS107

Who Are the Consumers？109

Segmentation Variables111

Marketing Research Implications：Data Collection119

Marketing Research Implications：Developing Target Markets122

ILLUSTRATION：Harley Davidson123

Why Do Consumers Buy？127

How Do Consumers Make Purchase Decisions？131

Search for Alternatives131

What Happens Next？132

Evaluating Options in the Consideration Set132

Postpurchase Behavior135

Where Do Customers Buy？136

When Do Customers Buy？137

ILLUSTRATION：Mango137

Executive Summary139

Chapter Questions139

Integrated Case Application Exercises：Consumer Behavior in the PC Industry139

Further Reading140

6 ORGANIZATIONAL BUYING BEHAVIOR141

Industrial Versus Consumer Marketing143

Derived Demand143

Product Complexity144

Buyer-Seller Interdependence144

Buying Process Complexity144

Who Are the Customers？145

Segmentation Variables145

Marketing Research Implications：Data Collection149

Marketing Research Implications：Developing Target Markets150

ILLUSTRATION：Signode Industries150

Why Do Customers Buy？153

How Do Customers Make Purchase Decisions？155

The Buying Center156

The Buying Process158

External and Internal Influences on Purchasing Behavior161

Where Do Customers Buy？161

When Do Customers Buy？161

Executive Summary163

Chapter Questions163

Integrated Case Application Exercises：Customer Behavior for the PC Industry164

Further Reading164

7 MARKET STRUCTURE AND COMPETITOR ANALYSIS165

Market Structure Analysis167

Definitions167

Measurement Issues172

Competitor Analysis176

Key Objectives177

Competitor Strategies178

Competitor Strengths and Weaknesses182

Expected Future Strategies185

Where Do We Get the Information？186

Secondary Sources187

Primary Sources188

Competitive Strategy：Some Game Theory Notions188

Executive Summary191

Chapter Questions192

Integrated Case Application Exercises：Market Structure and Competitor Analysis in the PC Industry192

Further Reading192

Part 3：Marketing Mix Decision-Making193

8 COMMUNICATIONS AND ADVERTISING STRATEGY193

Communications196

Integrated Marketing Communications200

Advertising200

Direct Marketing201

Sales Promotion202

Publicity and Public Relations202

Personal Selling202

Miscellaneous Communications Activities203

ILLUSTRATION：Amdahl Corporation203

ILLUSTRATION：M＆M Mars204

Advertising Management205

Selecting the Target Audience207

Setting Advertising Goals207

Developing the Message Strategy209

Evaluating Message Copy213

Selecting Media216

Budgeting221

Measuring Advertising Effects227

Executive Summary230

Chapter Questions230

Integrated Case Application Exercises：Communication in the PC Industry231

Further Reading231

9 CHANNELS OF DISTRIBUTION233

The Importance of Channels of Distribution234

Channel Dynamics239

Channel Functions241

Marketing Research241

Communications241

Contact241

Matching/ Customizing241

Negotiation241

Physical Distribution241

Financing242

Risk-Taking242

Service242

Relationship Management242

Product Assembly242

Framework for Choosing Among Channels242

Factors Affecting the Channel System243

Customer Behavior243

Competitors244

The Marketing Strategy246

Resources246

Channel Options247

Direct and Indirect Channels247

Multiple-Channel Systems248

ILLUSTRATION：Ingersoll-Rand249

Hybrid Systems250

ILLUSTRATION：Digital Equipment Company251

Channel Power and Management252

Channel Power252

Channel Management253

Some Special Topics in Channels of Distribution256

Using the Web256

Some Supermarket Issues258

Multilevel Marketing259

Direct Marketing260

ILLUSTRATION：Mercedes-Benz261

ILLUSTRATION：ON Technology262

Executive SummaRY263

Chapter Questions263

Integrated Case Application Exercises：Distribution Channels in the PC Industry264

FuRTher Reading264

10 PERSONAL SELLING265

The Sales Force and the Marketing Organization268

Types of Sales Organizations268

National/Key Accounts Organizations270

ILLUSTRATION：Marriott Lodging271

What Does a Salesperson Do？272

Directing the Sales Force273

Determinants of Performance273

Designing Sales Territories276

Determining the Size of the Sales Force277

Designing Sales Territories276

ILLUSTRATION：Syntex Corporation280

Setting Sales Quotas282

Sales Volume-Based282

Financially Based Quotas282

Activity-Based Quotas282

Combinations282

Compensation283

Straight Salary283

Straight Commission284

Combination Plans284

Controlling and Evaluating the Sales Force285

The Changing Nature of the Sales Force286

The Impact of Technology286

ILLUSTRATION：Lanier Worldwide289

The Salesperson’s Job290

Executive Summary291

Chapter Questions291

Integrated Case Application Exercises：Sales Management in the PC Industry291

Further Reading292

11 PRICING293

The Role of Marketing Strategy in Pricing294

Perceived Value297

Customer Value297

A Framework301

Price Elasticity301

Calculating Customer Value301

ILLUSTRATION：Hewlett-Packard304

ILLUSTRATION：Rocket Science Inc305

ILLUSTRATION：Rolling Rock Beer305

Using the Perceived Value Concept306

Competition and Pricing307

Competitors’ Costs307

The Role of Costs308

Deciding How Much of the Strategic Pricing Gap to Capture309

Pricing Objectives310

Psychological Aspects of Price311

Stage of the Product Life Cycle313

Industry Conditions315

Who Is the Decision Maker？315

Specific Pricing Tactics316

Product Line Pricing316

Value Pricing317

Differential Pricing318

Competing Against Private Labels319

Pricing and the Internet320

Executive Summary323

Chapter Questions324

Integrated Case Application Exercises：Pricing in the PC Market324

Further Reading325

12 SALES PROMOTION327

Types of Sales Promotion332

Consumer Promotions333

ILLUSTRATION：Beiersdorf340

Trade Promotions341

Retailer Promotions342

Promotion Strategy，Objectives，and Evaluation342

Customer-Oriented Promotions342

Trade Promotion345

ILLUSTRATION：Proctor ＆ Gamble348

Retail Promotion348

Promotion Budgeting349

Advertising and Promotion Budget349

Allocating Money Between Advertising and Promotion349

Sales Promotion and Information Technology352

In-Store Information Technology352

Using the Internet352

Executive Summary353

Chapter Questions355

Integrated Case Application Exercises：Sales Promotion in the PC Industry355

Further Reading356

Part 4：Special Topics in Marketing Management357

13 CUSTOMER RELATIONSHIP MANAGEMENT357

The Economics of Loyalty359

Acquisition Cost361

Base Profit361

Revenue Growth361

Operating Costs362

Referrals362

Price Premium362

The Total Effect362

Approaches to Customer Retention364

Customer Satisfaction364

Customer Value Management367

Customer Service370

Loyalty Programs374

OtherIdeas377

Mass Customization378

Marketing Information Systems382

ILLUSTRATION：Harrah’s Entertainment382

ILLUSTRATION：UPS382

Executive Summary384

Chapter Questions385

Integrated Case Application Exercises：Relationship Management in the PC Industry385

Further Reading386

14 STRATEGIES FOR SERVICE MARKETS387

The Nature of Services390

A Classification of Goods390

Characteristics of Services391

Service Quality391

The Service Quality Model391

The Dimensions of Service Quality392

Gaps in Perceptions of Quality393

Measuring Service Quality395

The Return on Quality396

Strategic Issues397

The Problem of Intangibility397

The Problem of Low Barriers to Entry398

Service Design401

ILLUSTRATION：Singapore Airlines403

Marketing Mix Implications of Service Marketing405

Channels of Distribution405

Advertising406

Pricing408

The Impact of Technology on Service Marketing409

ILLUSTRATION：Financial Services409

Executive Summary411

Chapter Questions411

Integrated Case Application Exercises：Service Marketing in the PC Industry412

Further Reading412

15 STRATEGIES FOR TECHNOLOGY-BASED MARKETS413

Customer Behavior416

Factors Affecting the Adoption Rate of New Technologies416

ILLUSTRATION：Fax Machines419

Perceived Risk419

The Problem of High-Tech Versus High-Touch420

The Diffusion of Innovations420

Marketing Strategies for High-Tech Products422

The Chasm Model422

ILLUSTRATION：Baan Co426

ILLUSTRATION：Netscape426

Switching Costs and Lock-In426

Market Segmentation Issues427

Positioning428

ILLUSTRATION：DNA Plant Technology Corporation429

Positioning Through Branding430

Handling Overlapping Technologies432

Marketing Mix Issues433

Channels of Distribution433

ILLUSTRATION：OEMs436

ILLUSTRATION：VARs436

Other Marketing Mix Variables437

Executive Summary437

Chapter Questions438

Integrated Case Application Exercises：High-Tech Marketing and the PC Industry439

Further Reading439

16 GLOBAL MARKETING STRATEGIES441

The Global Marketing Debate446

ILLUSTRATION：Orangina448

ILLUSTRATION：Tambrands448

Strategic Issues449

Market Entry Strategies449

Modes of Operation455

ILLUSTRATION：Fuji Xerox456

Consumer Behavior：The Importance of Cultural Differences458

Product Positioning460

ILLUSTRATION：Saatchi ＆ Saatchi460

Global Branding462

ILLUSTRATION：Lucky-Goldstar463

Defending Local Markets463

ILLUSTRATION：India464

Marketing Mix Implications465

Channels of Distribution465

ILLUSTRATION：Proctor ＆ Gamble467

Pricing468

Advertising and Promotion470

The Impact of the Internet471

Executive Summary472

Chapter Questions473

Integrated Case Application Exercises：Global Marketing and the PC Industry473

Further Reading474

17 NEW PRODUCT DEVELOPMENT475

Factors Affecting New Product Success or Failure479

Approaches to New Product Development481

The Classic Linear Approach481

The Rugby Approach483

The Target Costing Approach485

ILLUSTRATION：Nissan485

Steps in the New Product Development Process487

New Product Concept Generation487

Screening New Product Concepts489

Product Definition490

Forecasting Demand494

ILLUSTRATION：Nestle499

Topics in New Product Development501

The Importance of Shorter Product Development Cycles501

Improving the Integration of Marketing and R＆D503

Executive Summary504

Chapter Questions505

Integrated Case Application Exercises：New Product Development and the PC Industry505

Further Reading505

Notes507

Glossary525

Index535