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Because learning changes everything.®
Chapter 1
Overview of Marketing
Copyright 2022 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.
Learning Objectives
Learning Objective 1.1 Define the role of
marketing.
Learning Objective 1.2 Describe the evolution of
marketing over time.
Learning Objective 1.3 Describe how marketers
create value for a product or service.
© McGraw Hill LLC
3
Water Bottles
© McGraw Hill LLC
CD_works27/Shutterstock
4
What Is Marketing?
Marketing is the activity, set of institutions, and processes
for creating, capturing, communicating, delivering, and
exchanging offerings that have value for customers, clients,
partners, and society at large.
© McGraw Hill LLC
Alejandro Rivera/Getty Images
5
Exhibit 1.1 Core Aspects of Marketing
Access the text alternative for slide images.
© McGraw Hill LLC
6
Marketing Is about Satisfying Customer
Needs and Wants
How does Dove offer value?
• Dove added the Dove
Men+Care line and expanded
into products for babies.
• In advertising to male
consumers, Dove seeks to
acknowledge and recognize
modern men’s caregiving roles,
so it can link these
communications to its baby care
products too.
• Dove seeks to acknowledge
and recognize modern men’s
caregiving roles, so it can link
these communications to its
baby care products.
© McGraw Hill LLC
Dove seeks to acknowledge and recognize
modern men’s caregiving roles, so it can link
these communications to its baby care
products.
Source: Unilever
7
Exhibit 1.2: Exchange: The Underpinning of
Seller-Buyer Relationships
© McGraw Hill LLC
8
Exhibit 1.3: The Marketing Mix
© McGraw Hill LLC
Source: McGraw-Hill Global Education Holdings, LLC
9
Marketing Creates Value through Product,
Price, Place, and Promotion Decisions
The Marketing Mix:
The controllable set
of decisions or
activities that the firm
uses to respond to
the wants of its target
markets.
© McGraw Hill LLC
• Product.
• Price.
• Promotion.
• Place.
10
Product: Creating Value
The fundamental purpose of
marketing is to create value
by developing a variety of
offerings, including goods,
services, and ideas, to
satisfy customer needs.
• Goods.
• Services.
• Ideas.
Marketing creates value by promoting
ideas, such as bicycle safety.
© McGraw Hill LLC
Source: Street Smart, a public safety campaign of Metro, the District of Columbia, Maryland, and Virginia.
11
Price: Capturing Value
Price is everything a
buyer gives up (money,
time, energy) in
exchange for the
product or service.
If you don’t mind sitting in a middle seat and
putting all your baggage under your seat, flying on
low-cost carriers like Frontier is a good value.
© McGraw Hill LLC
Kateryna Kukota/Alamy Stock Photo
12
Place: Delivering the Value Proposition
Place represents all the
marketing processes
necessary to get the product to
the right customer when that
customer wants it.
Place more commonly deals
specifically with retailing and
marketing channel
management, also known as
supply chain management.
Hertz creates customer value by using biometrics to
create a function that recognizes loyal customers
using facial, iris, or fingerprint scans.
© McGraw Hill LLC
Jeff Martin/AP Images
13
Promotion: Communicating the Value
Proposition
Promotion is
communication by a
marketer that informs,
persuades, and reminds
potential buyers about a
product or service to
influence their buying
decisions and elicit a
response.
Babar books wanted to celebrate the 80th anniversary of the series.
It initiated a $100,000 campaign, working in collaboration with toy
stores and bookstores.
© McGraw Hill LLC
BananaStock/Alamy Images
14
Exhibit 1.4: Marketing Can Be Performed by
Individuals and by Organizations
© McGraw Hill LLC
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Marketing Impacts Various Stakeholders
Customers.
Supply Chain Partners.
Employees.
Industry.
Society.
The Great American Milk Drive, run in conjunction with
Feeding America, seeks to ensure that local food banks are
sufficiently stocked with nutritious, frequently requested items.
© McGraw Hill LLC
Source: America’s Milk Companies
16
PROGRESS CHECK (1 of 3)
1. What is the definition of marketing?
2. Marketing is about satisfying
blank.
blank and
3. What are the four components of the marketing
mix?
4. Who can perform marketing?
© McGraw Hill LLC
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Exhibit 1.5 Marketing Evolution:
Production, Sales, Marketing and Value
Photos (left to right): Ryan McVay/Photodisc/Getty Images; Clement Mok/Photodisc/Getty Images; Lawrence Manning/Corbis/Getty Images; Ryan McVay/Photodisc/Getty Images;
Mark Dierker/McGraw-Hill
Access the text alternative for slide images.
© McGraw Hill LLC
18
Value-Based Marketing
A Lipstick Option for Those Who Dream of a
Hermès Bag
© McGraw Hill LLC
© Justin Sullivan/Getty Images
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Value-Based Marketing Era
© McGraw Hill LLC
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PROGRESS CHECK (2 of 3)
1. What are the various eras of marketing?
© McGraw Hill LLC
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How Does Marketing Create Value and
How Do Firms Become More Value Driven?
Build relationships with customers.
Gather and analyze information.
Balance benefits and costs.
Connect with customers using social and
mobile media.
Access the text alternative for slide images.
© McGraw Hill LLC
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Value Stems From Four Main Activities
Adding Value
Using Marketing Analytics
Embracing Social and Mobile Marketing
Ethical and Societal Dilemma: Engaging in
Conscious Marketing
Access the text alternative for slide images.
© McGraw Hill LLC
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Marketing Analytics
Companies collect massive amounts of data about
how, when, why, where, and what people buy.
Kroger collects massive amounts of data about how, when, why, where, and what people buy and
then analyzes those data to better serve its customers.
© McGraw Hill LLC
© Daniel Acker/Bloomberg/Getty Images
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Connecting With Customers Using Social
and Mobile Marketing
Social media ad
spending is growing,
increasing by 32 percent
in 2018 alone.
3.26 billion people link
to some social media
sites through their
mobile devices.
Make travel arrangements online either
through Facebook or hotels’ mobile app and
check-in is a breeze.
© McGraw Hill LLC
Erik Isakson/Blend Images/Getty Images
25
Resolving Ethical and Societal Dilemmas
Conscious Marketing
Socially Responsible
Firms
Making socially
responsible activities an
integral component of
corporate strategies.
Too Good To Go is a UK-based app that has
partnered with 1,381 food stores to match
hungry customers to restaurants and stores
with surplus food that would otherwise go to
waste.
© McGraw Hill LLC
Guillaume Payen/SOPA Images/LightRocket/Getty Images
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PROGRESS CHECK (3 of 3)
1. Does providing a good value mean selling at a
low price?
2. How are marketers connecting with customers
through social and mobile media?
© McGraw Hill LLC
27
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Copyright 2022 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.
Because learning changes everything.®
Chapter 2
Developing Marketing
Strategies and a Marketing
Plan
Copyright 2022 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.
Learning Objectives
Learning Objective 2.1 Define a marketing strategy.
Learning Objective 2.2 Describe the elements of a marketing plan.
Learning Objective 2.3 Analyze a marketing situation using SWOT
analyses.
Learning Objective 2.4 Describe how a firm chooses which consumer
group(s) to pursue with its marketing efforts.
Learning Objective 2.5 Outline the implementation of the marketing
mix as a means to increase customer value.
Learning Objective 2.6 Summarize portfolio analysis and its use to
evaluate marketing performance.
Learning Objective 2.7 Describe how firms grow their business.
© McGraw Hill LLC
3
PepsiCo
The development at PepsiCo reflects careful
analysis of the market and efforts to ensure that it
continues to attract a wide range of consumers.
© McGraw Hill LLC
VStock / Alamy, Shutterstock/VDB Photos
4
What is a Marketing Strategy?
A marketing strategy
identifies:
• A firm’s target market.
• A related marketing
mix.
• The bases on which
the firm plans to build
a sustainable
competitive
advantage.
© McGraw Hill LLC
Shutterstock / SergZSV.ZP
5
Exhibit 2.1: Macro Strategies for Developing
Customer Value
Access the text alternative for slide images.
© McGraw Hill LLC
6
Customer Excellence
Retaining loyal
customers.
Providing outstanding
customer service.
Disney’s My Magic system enables users to
swipe their MagicBand wristbands to get on
rides, make purchases, and open their hotel
room door
© McGraw Hill LLC
parrysuwanitch/123RF
7
Operational Excellence
Efficient
operations
Excellent
supply chain
management
Strong
relationship
with
suppliers
© McGraw Hill LLC
8
Product Excellence
Provide products with high
perceived value and
effective branding and
positioning.
Bloomberg Businessweek’s
top global brands:
• Apple, Google,
Microsoft, Coca-Cola,
Amazon, Samsung,
Toyota, Facebook,
Mercedes, IBM.
© McGraw Hill LLC
© Jacek Lasa / Alamy
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Locational Excellence
Especially important for retailers and service providers.
Many say, “The three most important things in retailing are
location, location, location.”
Competitive advantage based on location is not easily
duplicated. Starbucks makes it difficult for competitors to
enter a market and find good locations.
© McGraw Hill LLC
10
Multiple Sources of Advantage
A single strategy (low
prices or excellent service)
is usually not enough to
build a sustainable
competitive advantage.
Southwest Airlines
• Provides good service
at a good value (ontime flights that are
reasonably priced).
© McGraw Hill LLC
Carlos E. Santa Maria/Shutterstock
11
PROGRESS CHECK (1 of 3)
1. What are the various components of a marketing
strategy?
2. List the four macro strategies that can help a
firm develop a sustainable competitive
advantage.
© McGraw Hill LLC
12
Exhibit 2.2: The Marketing Plan
Access the text alternative for slide images.
© McGraw Hill LLC
13
Step 1: Define the Business Mission
PepsiCo’s Mission Statement:
“To provide consumers around the world with delicious,
affordable, convenient and complementary foods and
beverages from wholesome breakfasts to healthy and
fun daytime snacks and beverages to evening treats.”
Coke’s Mission Statement:
“To refresh the world … To inspire moments of optimism
and happiness … To create value and make a
difference.”
© McGraw Hill LLC
14
Step 1: Conduct a Situation Analysis Using
SWOT Analysis
© McGraw Hill LLC
Internal
Strengths
Internal
Weaknesses
External
Opportunities
External
Threats
15
Exhibit 2.3: Examples of Elements in a SWOT
Analysis (1 of 2)
Pepsi
Environment
Evaluation
Positive
Negative
Internal
Strengths
• Diverse brand portfolio
• Strong celebrity endorsers
• Successful marketing
campaigns with music
industry
• Commitment to social and
environmental charitable
causes
Weaknesses
• Lower brand awareness than
rival Coca-Cola
• Less market share than rival
Coca-Cola
• Environmentally unfriendly
packaging
External
Opportunities
• Expanding health food market
• Growth in global market share
• Acquisition of new brands
Threats
• Water scarcity
• Popularity of reusable water
bottles
• Soda taxes
• Increasing competition in the
snack food market
Sources: Bitesh Bhasin, “SWOT Analysis of Pepsi—PepsiCo SWOT Analysis,” Marketing91, April 3, 2019; Hitesh Bhasin, “SWOT of Coca-Cola,” Marketing91, 2018.
© McGraw Hill LLC
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Exhibit 2.3: Examples of Elements in a SWOT
Analysis (2 of 2)
CocaCola
Environment
Evaluation
Positive
Negative
Internal
Strengths
• High market share
• Strong brand
• Strong global presence
• Excellent customer loyalty
• Supply chain
Weaknesses
• Low diversification
• Few healthy beverages
External
Opportunities
• Emerging countries
• Diversifying products
• Bottled water
Threats
• Water scarcity
• Potential market
saturation
• Changes to labeling
regulations
• Increasing competitors
Sources: Bitesh Bhasin, “SWOT Analysis of Pepsi—PepsiCo SWOT Analysis,” Marketing91, April 3, 2019; Hitesh Bhasin, “SWOT of Coca-Cola,” Marketing91, 2018.
© McGraw Hill LLC
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Step 3: Identifying and Evaluating
Opportunities Using STP
Segmentation
Targeting
Positioning
© McGraw Hill LLC
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Exhibit 2.4: Hertz: Market Segmentation
Illustration
Segments
Cars
Offered
© McGraw Hill LLC
Segment 1
Segment 2
Segment 3
Segment 4
Segment 5
Single thrill
seekers and
gear heads on
vacation
Business
customers
and families
who prefer a
luxurious ride
Environmental
ly conscious
customers
Families
Commercial
customers
Adrenaline
Collection
Prestige
Collection
Green
Traveler
Collection
SUV/Mini
van/4×4
Collection
Commercial
Van/Truck
Collection
Corvette ZHZ
Infiniti QX56
Toyota Prius
Toyota RAV4
Ford Cargo
Van
Chevrolet
Camaro
Cadillac
Escalade
Ford Fusion
Ford Explorer
19
Market Positioning
Choose which segments to
pursue, then how to position
within those segments.
Define the marketing mix
variables so target customers
have a clear, distinctive, and
desirable understanding of the
product compared to competition.
Hertz positions itself as a quality
car and truck rental company that
is the first choice for each target
segment.
© McGraw Hill LLC
Shutterstock/MuchMania
20
Step 4: Implement Marketing Mix and Allocate
Resources
© McGraw Hill LLC
Product and Value
Creation
Price and Value
Capture
Place and Value
Delivery
Promotion and
Value
Communication
21
Product and Value Creation
Successful products and services are those that
customers perceive as valuable enough to purchase.
Dyson creates value with its innovative products (left). It can therefore charge significantly more than
the price charged for conventional fans (right).
Access the text alternative for slide images.
© McGraw Hill LLC
(Left): Source: Dyson, Inc.; (right): Stockbyte/Getty Images
22
Price and Value Capture
Price is what the customer is willing to pay for
a product they perceive as good value.
© McGraw Hill LLC
Shutterstock / RUBEN M RAMOS
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Place and Value Delivery
The product must be
readily accessible
when and where the
customer wants it.
• Dyson provides
product and place
value.
• Where are Dyson
fans available?
© McGraw Hill LLC
Top: Shutterstock/TotallyMJ , Bottom: Shutterstock/Maxx-Studio
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Promotion and Value Communication
Advertising
Online
marketing
(including
social
media)
Personal
selling
Integrated
marketing
communications
(IMC)
Direct
marketing
Sales
promotion
Public
relations
Access the text alternative for slide images.
© McGraw Hill LLC
25
Step 5: Evaluate Performance Using
Marketing Metrics
A metric is a measuring
system that quantifies a
trend, dynamic, or
characteristic.
Metrics are used to
explain why things
happened and also
project the future.
© McGraw Hill LLC
Shutterstock / NicoElNino
26
Evaluating Performance
Who is accountable for
performance?
EXHIBIT 2.5 Performance Metrics: Coke vs. Pepsi
•
Performance
Objectives, Marketing
Analytics, and Metrics.
•
Financial Performance
Metrics.
•
Portfolio Analysis.
Access the text alternative for slide images.
© McGraw Hill LLC
Source: MarketWatch, Inc.
27
Exhibit 2.6 Boston Consulting Group Matrix
Photos (top left): DenPhotos/Shutterstock; (top right): Kicking Studio/Shutterstock; (bottom left): Sushiman/Shutterstock;
(bottom right): David Caudery/Tap Magazine/Getty Images
Access the text alternative for slide images.
© McGraw Hill LLC
P&G
Website
28
Which Quadrant?
Whether a product is
classified as a star or
a question mark has
profound implications
on how it is treated
and supported within
the firm.
© McGraw Hill LLC
Top: Ksander/Shutterstock; Bottom: Denis Rozhnovsky / Alamy Stock Photo
29
PROGRESS CHECK (2 of 3)
1. What are the five steps in creating a marketing
plan?
2. What tool helps a marketer conduct a situation
analysis?
3. What is STP?
4. What do the four quadrants of the portfolio
analysis represent?
© McGraw Hill LLC
30
Growth Strategies
Exhibit 2.7: Markets/Products and Service Strategies
Access the text alternative for slide images.
© McGraw Hill LLC
31
Market Penetration
Current marketing mix,
Current customers
Marvel used a market
penetration strategy by
expanding the distribution of
its films:
• Theaters.
• Xfinity.
• DVDs (in a variety of retail
locations).
© McGraw Hill LLC
Shutterstock/Nestor Rizhniak
32
Market Development
Current Products or
Services.
New Markets.
Marvel pursues such a
market development
strategy when it enhances
the viewing of its movies by
expanding into more global
markets.
© McGraw Hill LLC
Klaus Vedfelt/Getty Images
33
Product Development
New product or service.
Current target market.
Marvel launched several
successful series on Netflix,
including Jessica
Jones, Daredevil, Iron
Fist, and Luke Cage.
• By developing series designed
for this format, Marvel can
connect with its customers in a
new and important way.
© McGraw Hill LLC
Left: Dragon Images/Shutterstock, Right: Makistock/Shutterstock
34
Diversification
New product or service.
New market segment.
Related vs. unrelated
diversification.
•
Marvel has pursued related
diversification with its home décor.
•
If Marvel ventured into the child
day care service industry, it would
be an unrelated diversification
because it is so different from its
core business and therefore very
risky.
© McGraw Hill LLC
Photos (top): Interior Design/Shutterstock; (bottom): Ariel Skelley/Photodisc/Getty Images
35
PROGRESS CHECK (3 of 3)
1. What are the four growth strategies?
2. What type of strategy is growing the business
from existing customers?
3. Which strategy is the riskiest?
© McGraw Hill LLC
36
Because learning changes everything.
®
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Copyright 2022 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.
Because learning changes everything.®
Chapter 3
Digital Marketing: Online,
Social, and Mobile
Copyright 2022 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.
Learning Objectives
Learning Objective 3.1 Describe the 4E framework of digital
marketing.
Learning Objective 3.2 Examine the seven critical elements of online
marketing.
Learning Objective 3.3 Understand the drivers of social media
engagement.
Learning Objective 3.4 Understand various motivations for using
mobile applications.
Learning Objective 3.5 Recognize and understand the components of
a digital marketing strategy.
Learning Objective 3.6 Understand the central factors in picking an
influencer partner.
© McGraw Hill LLC
3
Hilton
© McGraw Hill LLC
Regien Paassen/Shutterstock
4
Exhibit 3.1: The 4E Framework for Digital
Marketing
Access the text alternative for slide images.
© McGraw Hill LLC
5
Excite the Customer
Offer must be relevant
to its targeted customer.
Relevancy can be
achieved by providing
personalized offers.
ﻋﺮﻭﺽ
ﻋﺮﻭﺽ ﻣﺨﺼﺼﻪ ﻟﻠﻌﻤﻴﻞ
Marketers use many kinds of digital offers to excite customers,
and to excite them, an offer must be relevant to its targeted
customer. Lush Cosmetics encourages customers to post
pictures of themselves using its products on social media by
promising that if they use #LushLife, they might find
themselves featured on its official page.
Source: Lush Cosmetics/Instagram
© McGraw Hill LLC
6
Educate the Customer
Golden opportunity to
educate about the
product’s value
proposition and
communicate offered
benefits.
When marketing
ideas, the goal is to
improve people’s
well-being, along with
selling the underlying
concept.
© McGraw Hill LLC
To educate women about how to perform breast self-exams, the #KnowYourLemons
campaign posted pictures of a dozen lemons to teach people about 12 shapes and lumps
they should be looking for when they themselves for cancer each month.
Source: Worldwide Breast Cancer
7
Experience the Product or Service
Provide vivid information
about a firm’s goods and
services. ﺗﻘﺪﻳﻢ ﻣﻌﻠﻮﻣﺎﺕ ﺣﻴﺔ ﻋﻦ ﺳﻠﻊ ﻭﺧﺪﻣﺎﺕ ﺍﻟﺸﺮﻛﺔ
Simulate real experiences.
ﻣﺤﺎﻛﺎﺓ ﺍﻟﺘﺠﺎﺭﺏ ﺍﻟﺤﻘﻴﻘﻴﺔ
Sephora maintains its own YouTube channel with dedicated videos that
demonstrate how to use specific products like bright pink eyeshadow.
© McGraw Hill LLC
Source: Sephora USA, Inc.
8
Engage the Customer
Action, loyalty, and
commitment.
Positively engaged
consumers lead to more
profitability.
Engagement can also
backfire.
IKEA engages customers with its “Place” app that enables
customers to select an item from its catalog and then, by
using the camera within the app, visualize the item in their
home or office.
© McGraw Hill LLC
Source: IKEA Systems B.V.
9
PROGRESS CHECK (1 of 6)
1. What are the 4 Es?
2. What social media elements work best for each
of the 4 Es?
© McGraw Hill LLC
10
EXHIBIT 3.2: The 7C Online Marketing Framework
Access the text alternative for slide images.
© McGraw Hill LLC
11
1. Core Goals
The basis of any
marketing strategy is its
goals.
Determine specific
goals.
Align the goals with the
target market and align
the 7Cs with the goals.
© McGraw Hill LLC
Hasbro has embraced online marketing to reflect its core goals. To
introduce this new brand called Hanazuki, it developed an entire
series that viewers can watch on YouTube. The Hanazuki page is
filled with animation, movement, and bright colors, encouraging
visitors to take their time exploring the different characters, watching
videos, downloading apps, and perhaps shopping too.
Source: Hasbro, Inc.
12
2. Context Elements
Design.
Navigation.
Must be in alignment
with the target market.
Because Walmart’s core goal is to encourage purchases, its commerceoriented website features a simple look and feel. Looking closely at the
design and color scheme, notice that Walmart’s home page aligns with its
adult target market. It is more traditionally focused on selling Hanazuki
merchandise than Hasbro, Inc. with little concern for the brand itself.
© McGraw Hill LLC
Source: Walmart Stores, Inc.
13
3. Content
Monitor to ensure
relevancy.
Devise appropriate
keywords to improve
organic search.
Implement SEM and
paid search.
ﺑﺤﺚ ﻣﺪﻓﻮﻉ ﻟﻤﺤﺮﻛﺎﺕ ﺍﻟﺒﺤﺚ
The content of these messages must resonate with its target market, but
need
not always showcase merchandise or services, as in the Facebook
ﻋﺸﺎﻥ ﺍﻟﺸﺮﻛﺔ ﺗﻄﻠﻊ ﺍﻭﻝ ﻭﺣﺪﺓ ﻟﻤﺎ ﻧﺒﺤﺚ ﻋﻦ ﻣﻨﺘﺞ
post from the jewelry firm, Alex and Ani. The company is not showcasing its
jewelry per se, but rather providing a motivational quote that resonates with
young females, its primary target market.
© McGraw Hill LLC
Source: Alex and Ani, LLC
14
4. Community
Allow customers to
interact.
Use corporate and
professional blogs.
Engage in
Crowdsourcing.
ﻳﺸﺎﺭﻛﻮﻫﻢ ﺍﻻﻗﺘﺮﺍﺣﺎﺕ,ﻳﺴﺄﻟﻮ ﺍﻟﻨﺎﺱ ﺷﻮ ﺑﺪﻫﻢ ﻣﻨﺘﺠﺎﺕ
Betabrand uses crowdsourcing by having its customers submit clothing
design ideas and feedback on items before they are manufactured.
© McGraw Hill LLC
Source: Betabrand
15
5. Communication
Clear, helpful, meaningful content enables effective
communication.
Enables interacting with, engaging, and educating
site visitors.
Provide a mechanism for customers to
communicate with the firm.
© McGraw Hill LLC
16
6. Commerce
Desktop usage is greater,
and conversion rates
higher, for online
purchases.
The most loyal customers
use multiple channels.
Customers want a range of
online purchase options.
Through Sephora’s mobile app, Beauty Insider account holders can check their
loyalty points, access past purchase behavior, receive personalized
recommendations, scan items while in stores, and much more.
© McGraw Hill LLC
Source: Sephora USA, Inc.
17
7. Connection
Engage customers and
provide a call to action.
Allow customers to
interact with the firm
continuously.
Enable positive
engagement.
A good website or blog engages customers and provides them with a
call to action. Warby Parker connects customers with four call-to-action
buttons inviting visitors to: get started, order frames to try on at home,
take a quiz, and shop online.
© McGraw Hill LLC
Source: Warby Parker
18
PROGRESS CHECK (2 of 6)
1. Describe the components of the 7C online
marketing framework.
2. Differentiate between organic and paid search.
© McGraw Hill LLC
19
Exhibit 3.3:
The Wheel of Social Media Engagement
© McGraw Hill LLC
20
The Information Effect
Outcome in which relevant
information is spread by
firms or individuals to other
members of the social
network.
© McGraw Hill LLC
BigTunaOnline/Shutterstock
21
The Connected Effect
Outcome that satisfies humans’ innate need to connect with
other people.
© McGraw Hill LLC
Source: William Perugini/Shutterstock
22
The Network Effect
Outcome in which every post is spread instantaneously
across social media.
© McGraw Hill LLC
Source: Shutterstock/Metamorworks
23
The Dynamic Effect
Information is exchanged to network participants through
back-and-forth communications.
Examines how people flow in and out of networked
communities as their interests change.
© McGraw Hill LLC
Rawpixel.com/Shutterstock
24
The Timeliness Effect
Firms must engage with the customer at the right
place and time.
Using beacon technology, Coca-Cola is able to engage customers in
a timely manner by offering moviegoers a free Coke at the moment
they walk into a movie theater.
© McGraw Hill LLC
Source: SeongJoon Cho/Bloomberg/Getty Images
25
PROGRESS CHECK (3 of 6)
1. What are the five drivers of social media
engagement described in the Wheel of Social
Media Engagement?
© McGraw Hill LLC
26
Going Mobile and Social
Exhibit 3.4: Seven Primary Motivations for Mobile App Usage
Need for “Me Time”
Need to Socialize
Need to Shop
(showrooming)
Need to Accomplish
Need to Prepare
Need to Discover
Need to Self-Express
With more than 3 billion downloads, Candy Crush Saga clearly fulfills for
many people an important need for unproductive “me time.”
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Source: Alexat25/Shutterstock
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App Pricing Models
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PROGRESS CHECK (4 of 6)
1. What are the seven types of customer
motivations for using mobile apps?
2. What are the four options for pricing mobile
apps?
3. What are some of the most popular types of
mobile applications?
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How Do Firms Engage Their Customers?
Exhibit 3.4: Social Media Engagement Process
ﺍﻟﺼﻮﺭﺓ ﻫﻨﺎ ﺍﻓﻀﻞ
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Listen
———
Listening helps
determine digital
marketing objectives and
strategies.
Sentimental analysis
allows marketers to
analyze and determine
consumers attitudes and
preferences.
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Other companies perform their own analyses, effectively leveraging their
existing capacities for listening to customers. Zappos is known for its
remarkable customer service and attracts plenty of buzz about its
offerings. It takes the information it gathers from listening to customers to
design strategies that emphasize what they like most.
Source: Zappos.com, Inc.
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Analyze
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Exhibit 3.5: How to Do a Digital Marketing
Campaign
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Do
Develop and implement
campaigns using social
media.
EXHIBIT 3.6 Example Facebook Targeting Choices
Effective implementation
based on social and
mobile media activity.
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Source: Facebook
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PROGRESS CHECK (5 of 6)
1. What are the components of a digital marketing
strategy?
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Influencer Marketing
A marketing strategy that uses
opinion leaders, popular on social
media, to drive marketing
messages to a targeted audience.
Firms hire (or encourage) these
well-known names to promote
brand messages to their networks
of followers.
Big-time influencers like
Ariana Grande have millions
of followers and can
command almost a mil-lion
dollars for a sponsored post.
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Source: Lev Radin/Shutterstock
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Assessing the Efficacy of Influencers
Relevance
Reach
Response
Return
Influencers like Selena Gomez can reach millions of potential
customers for Coca-Cola with an Instagram post like this one, which
depicts her drinking a Coke with the lyrics from one of her songs on
the bottle.
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Source: Selena Gomez/Instagram
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Exhibit 3.8: Influencer Marketing Chain of
Events
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Exhibit 3.9: Types of Influencers
Type of Influencer
Definition
Example
Key Channels
Average Cost per Post
Celebrity
Large following, widely
recognized
Social media, print,
television
$3,000–$500,000
Micro
Modest following, niche
interest
Posts on social media
sites, shared promo codes
$80–$500
Blog
Writes for a blog and has
attracted readers and
subscribers with that
content
Reviews on blog, guest
blog posts
$400–$5,500
Social media
Popular on social platforms
(Instagram, YouTube,
Twitter) among followers in
specific target audiences
Key opinion leader or
expert in a specific field
Nespresso relies heavily on
George Clooney to promote its
products in marketing across
platforms, leveraging his cool
image to enhance its appeal but
also his reputation for
environmental sustainability to
promote its own efforts along these
lines
NUX Active (athletic clothing
brand) worked with Sydney
Loveleigh Nelson, whose health
and fitness posts have earned her
about 21,000 followers
The FaceGym spa sponsored a
blog post by lifestyle blogger
Hannah Bronfman to provide
information about its services and
treatments
LaCroix worked with nutritionist
Joy Bauer to create a Twitter post
of a recipe she had created, using
the product
BoxyCharm, a subscription beauty
box service, worked with Kandee
Johnson, a professional makeup
artist, to make videos that
explained each product included in
a box
Pictures posted with the
product, shared hashtags,
videos featuring the
product
Social media, tutorials,
reviews, blog posts,
sponsored print articles,
articles in academic
journals
$100–$500,000
Specialized
$500–$5,000
Source: Kristen Baker, “What Will Influencer Marketing Look Like in 2020?,” HubSpot, December 2, 2019, https://blog.hubspot.com/marketing/how-to-work-with-influencers
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Ethical Considerations for Influencer Marketing
Fraudulent Influence
• The incentive to boost follower numbers accordingly has led to
various unethical behaviors.
Disclosing Advertising
• Intent if an influencer is being paid to promote a product, that
information should be clear in the post.
Sincerity
• Effective influence attempts require followers to believe that the
influencer actually likes and appreciates the product.
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PROGRESS CHECK (6 of 6)
1. How should firms choose and assess the efficacy
of influencers?
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Because learning changes everything.
®
www.mheducation.com
Copyright 2022 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.
Because learning changes everything.®
Chapter 5
Analyzing the Marketing
Environment
Copyright 2022 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.
Learning Objectives
Learning Objective 5.1 Outline how customers, the
company, competitors, corporate partners, and the
physical environment affect marketing strategy.
Learning Objective 5.2 Explain why marketers must
consider their macroenvironment when they make
decisions.
Learning Objective 5.3 Identify various social trends that
impact marketing.
Learning Objective 5.4 Examine the technological
advances that are influencing marketers.
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Exhibit 5.2: Understanding the Marketing
Environment
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Exhibit 5.2: The Immediate Environment
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Company Capabilities
Successful marketing
firms focus on
satisfying customer
needs that match their
core competencies.
Corning initially made its name by producing the glass enclosure to encase
Thomas Edison’s lightbulb. But by successfully leveraging its core
competency in glass manufacturing while also recognizing marketplace
trends toward mobile devices, Corning shifted its focus.
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Somchai Som/Shutterstock
6
Competitors
Know their strengths,
weaknesses, and likely
reactions to firm’s
marketing activities.
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10’000 Hours/Getty Images
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Corporate Partners
Parties that work
with the focal firm.
Nau works with
manufacturers to
develop clothing
from sustainable
materials.
Nau works with its corporate partners to develop socially
responsible outdoor (left) and urban (right) apparel.
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(Left): Philipp Nemenz/Getty Images; (right): PeopleImages/Getty Images
8
Physical Environment
Sustainable development:
Includes land, water, air, and
living organisms.
Products and services are
influenced by how they are
used in the physical
environment, and in turn they
can also influence the physical
environment.
Examples:
• Energy Trends.
• Greener Practice
