An IntroductioEleventnh Edition r Global Edition - ? Market Segmentation 193 Segmenting Consumer Markets

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An Introduction Eleventh EditionGlobal EditionrerrGARY ARMSTRONGUniversity of NorthXarolinaPHILIP KOTLERNorthwestern UniversityBoston Columbus Indianapolis New York San FranciscoUpper Saddle River Amsterdam Cape Town Dubai LondonMadrid Milan Munich Paris Montreal Toronto Delhi Mexico CitySao Paulo Sydney Hong Kong Seoul Singapore Taipei TokyoContentsPreface 21 %Acknowledgments 26IT1 DEFINING MARKETING AND THE MARKETING PROCESS 30Marketing: Creating and Capturing Customer Value 30CHAPTER ROAD MAP 30Objective Outline 30 Previewing the Concepts 30 First Stop: FlyDubai 31What Is Marketing? 33Marketing Defined 33 The Marketing Process 33Understanding the Marketplace and Customer Needs 34Customer Needs, Wants, and Demands 34 Market OfferingsProducts, Services, andExperiences 34 Customer Value and Satisfaction 35 Exchanges and Relationships 35 Markets 36Designing a Customer-Driven Marketing Strategy 37Selecting Customers to Serve 37 Choosing a Value Proposition 37 Marketing Management^ Orientations 37 ,,Preparing an Integrated Marketing Plan and Program 40Building Customer Relationships 41Customer Relationship Management 41Marketing at Work 1.1: Customer Relationship Management at AWT, Abu Dhabi,United Arab Emirates (UAE) 43The Changing Nature of Customer Relationships 45 Partner Relationship Management 48Capturing Value from Customers 48Creating Customer Loyalty and Retention 48 Growing Share of Customer 49 Building CustomerEquity 50The Changing Marketing Landscape 51The Changing Economic Environment 52Marketing at Work 1.2: An Era of AusterityThe Thrifty Route in Fashion 53The Digital Age 54 The Growth of Not-for-Profit Marketing 55 RapidGlobalization 56 Sustainable MarketingThe Call for More Social Responsibility 56So, What Is Marketing? Pulling It All Together 57REST STOP: REVIEWING THE CONCEPTS 59CHAPTER REVIEW AND KEY TERMS Objectives Review 59 Key Terms 60 DISCUSSIONAND CRITICAL THINKING Discussion Questions 61 Critical ThinkingExercises 61 MINICASES AND APPLICATIONS Marketing Technology 61 MarketingEthics 62 Marketing by the Numbers 62 Video Case 62 Company Cases 631112 Contents/ Company and Marketing Strategy: Partnering to Build CustomerRelationships 64CHAPTER ROAD MAP 64 "Objective Outline 64 Previewing the Concepts 64 First Stop: McDonald's 65 \ ^Company-Wide Strategic Planning: Defining Marketing's Role 66Defining a Market-Oriented Mission 67 Setting Company Objectives and Goals 68Designing the Business Portfolio 69Analyzing the Current Business Portfolio 69Marketing at Work 2.1: Singapore Airlines: Going the Extra Mile in Strategic Planning 70Developing Strategies for Growth and Downsizing 73Planning Marketing: Partnering to Build Customer Relationships 74Partnering with Other Company Departments 75 Partnering with Others in the Marketing System 76Marketing Strategy and the Marketing Mix 76Customer-Driven Marketing Strategy 77Marketing at Work 2.2: Nicher Allegiant Air: "Going Where They Ain't" 79 /Developing an Integrated Marketing Mix 80Managing the Marketing Effort 82Marketing Analysis 82 Marketing Planning 83 Marketing Implementation 83 MarketingDepartment Organization 84 Marketing Control 85Measuring and Managing Return on Marketing Investment 86* REST STOP: REVIEWING THE CONCEPTS 88CHAPTER REVIEW AND KEY TERMS Objectives Review 88 Key Terms 89 DISCUSSIONAND CRITICAL THINKING Discussion Questions 89 Critical ThinkingExercises 89 MINICASES AND APPLICATIONS Marketing Technology 90 MarketingEthics 90 Marketing by the Numbers 90 Video Case 91 Company Cases 91PMTT 2 > UNDERSTANDING THE MARKETPLACE AND CONSUMERS 923) Analyzing the Marketing Environment 92CHAPTER ROAD MAP 92Objective Outline 92 Previewing the Concepts 92 First Stop: YouTube 93The Microenvironment 95The Company 95 Suppliers 95 MarketingIntermediaries 96 Competitors 96 Publics 97 Customers 97The Macroenvironment 98The Demographic Environment 98 The Economic Environment 104 The Natural"Environment 105 The Technological Environment 107 The Political and Social Environment 108The Cultural Environment 111Marketing at Work 3.1: Spearheading Environmental Responsibility: "Masdar" 112Responding to the Marketing Environment 116Marketing at Work 3.2: When the Dialog Gets Nasty: Turning Negatives into Positives 117Contents 13REST STOP: REVIEWING THE CONCEPTS 118CHAPTER REVIEW AND KEY TERMS Objectives Review 118 Key Terms 119 DISCUSSIONAND CRITICAL THINKING Discussion Questions 120 Critical ThinkingExercises 120 MINICASES AND APPLICATIONS Marketing Technology 120 MarketingEthics 121 Marketing by the Numbers 121 Video Case 12P* Company Cases 121A Managing Marketing Information to Gain \Customer Insights 122 CHAPTER ROAD MAP 122Objective Outline 122 Previewing the Concepts 122 First Stop: Protrac 123Marketing Information and Customer Insights 124Assessing Marketing Information Needs 125Developing Marketing Information 126Internal Data 126 Competitive Marketing Intelligence 127Marketing Research 128Defining the Problem and Research Objectives 129 Developing the Research Plan 129 GatheringSecondary Data 130 Primary Data Collection 131Marketing at Work 4.1: Ethnographic Research: Watching What Consumers Really Do 132Marketing at Work 4.2: Listening Online: The Web Knows What You Want 139Implementing the Research Plan 142 Interpreting and Reporting the Findings 142Analyzing and Using Marketing Information 143Customer Relationship Management 143 Distributing and Using Marketing Information 144: Other Marketing Information Considerations 145Marketing Research in Small Businesses and Nonprofit Organizations 145 International MarketingResearch 146 Public Policy and Ethics in Marketing Research 148REST STOP: REVIEWING THE CONCEPTS 150CHAPTER REVIEW AND KEY TERMS Objectives Review 150 Key Terms 151 DISCUSSIONAND CRITICAL THINKING Discussion Questions 151 Critical ThinkingExercises 151 MINICASES AND APPLICATIONS Marketing Technology 152 MarketingEthics 152 Marketing by the Numbers 153 Video Case 153 Company Cases 153R Understanding Consumer and Business Buyer Behavior 154CHAPTER ROAD MAP 154Objective Outline 154 Previewing the Concepts 154 First Stop: Apple 155Consumer Markets and Consumer Buyer Behavior 156Model of Consumer Behavior 156 Characteristics Affecting Consumer Behavior 157Marketing at Work 5.1: CSL 1010: Moving Forward with New Consumers 162The Buyer Decision Process 170Need Recognition 170 Information Search 170 Evaluation of Alternatives 171 PurchaseDecision 172 Postpurchase Behavior 172The Buyer Decision Process for New Products 173Stages in the Adoption Process 173 Individual Differences in Innovativeness 174 Influence ofProduct Characteristics on Rate of Adoption 17414 ContentsBusiness Markets and Business Buyer Behavior 175Business Markets 176 Business Buyer Behavior 177 \Marketing at Work 5.2: Dow Performance Plastics: "If You Win, We Win" 178REST STOP: REVIEWING THE CONCEPTS 185CHAPTER REVIEW AND KEY TERMS Objectives Review 185 Key Terms 187, DISCUSSIONAND CRITICAL THINKING Discussion Questions 187 Critical Thinking \Exercises 187 MINICASES AND APPLICATIONS Marketing Technology 188 MarketingEthics 188 Marketing by the Numbers 188 Video Case 189 Company Cases 189* DESIGNING A CUSTOMER-DRIVEN STRATEGYAND MIX 190J\ Customer-Driven Marketing Strategy: Creating Valuefor Target Customers 190CHAPTER ROAD MAP 190Objective Outline 190 Previewing the Concepts 190 First Stop: Air Arabia 191Market Segmentation 193Segmenting Consumer Markets 193Marketing at Work 6.1: Mobinil: Targeting the Mobile Telecommunications Market 196Segmenting Business Markets 200 Segmenting International Markets 201 Requirements forEffective Segmentation 202Market Targeting 202Evaluating Market Segments 202 Selecting Target Market Segments 203Marketing at Work 6.2: Location-Based Micromarketing Equals Macro Opportunities 206Differentiation and Positioning 210Positioning Maps 211 Choosing a Differentiation and Positioning Strategy 211 Communicating andDelivering the Chosen Position 216REST STOP: REVIEWING THE CONCEPTS 217CHAPTER REVIEW AND KEY TERMS Objectives Review 217 Key Terms 218 DISCUSSIONAND CRITICAL THINKING Discussion Questions 219 Critical ThinkingExercises 219 MINICASES AND APPLICATIONS Marketing Technology 219 MarketingEthics 220 Marketing by the Numbers 220 Video Case 220 Company Cases 221I# Products, Services, and Brands: Building Customer Value 222CHAPTER ROAD MAP 222Objective Outline 222 Previewing the Concepts 222 First Stop: Emirates Airlines 223What Is a Product? 224Products, Services, and Experiences 225 Levels of Product and Services 225 Product and ServiceClassifications 226 :Product and Service Decisions 229Individual Product and Service Decisions 229 Product Line Decisions 234 Product MixDecisions 235Contents 15Services Marketing 236The Nature and Characteristics of a Service 236 Marketing Strategies for Service Firms 238Marketing at Work 7.1: Taking Care of Those Who Take Care of Customers 239Branding Strategy: Building Strong Brands ^243Brand Equity 243 Building Strong Brands 244 ~Marketing at Work 7.2: Thrifty Times Are Good Times for Store Brands. But What's National Brandto Do? 247Managing Brands 251REST STOP: REVIEWING THE CONCEPTS 252CHAPTER REVIEW AND KEY TERMS Objectives Review 252 Key Terms 253 DISCUSSIONAND CRITICAL THINKING Discussion Questions 253 Critical ThinkingExercises 253 MINICASES AND APPLICATIONS Marketing Technology 254 MarketingEthics 254 Marketing by the Numbers 254 Video Case 255 Company Cases 255M Developing New Products and Managingthe Product Life Cycle 256CHAPTER ROAD MAP 256Objective Outline 256 Previewing the Concepts 256 First Stop: Google 257New-Product Development Strategy 258The New-Product Development Process 259Idea Generation 259 Idea Screening 262 Concept Development and Testing 262 MarketingStrategy Development 263 Business Analysis 264 Product Development 264 TestMarketing 265 Commercialization 266Managing New-Product Development 266Customer-Centered New-Product Development 266 Team-Based New-ProductDevelopment 267 Systematic New-Product Development 267Marketing at Work 8.1: LEGO Group: Building Customer Relationships, Brick by Brick 268New-Product Development in Turbulent Times 269Product Life-Cycle Strategies 270Introduction Stage 272 Growth Stage 272 Maturity Stage 273Marketing at Work 8.2: Swatch: New Times for Swiss Watchmaking 274Decline Stage 275Additional Product and Service Considerations 276Product Decisions and Social Responsibility 276 International Product and Services Marketing 277REST STOP: REVIEWING THE CONCEPTS 278CHAPTER REVIEW AND KEY TERMS Objectives Review 278 Key Terms 279 DISCUSSIONAND CRITICAL THINKING Discussion Questions 280 Critical ThinkingExercises 280 MINICASES AND APPLICATIONS Marketing Technology 280 MarketingEthics 280 Marketing by the Numbers 281 Video Case 281 Company Cases 281Pricing: Understanding and Capturing Customer Value 282CHAPTER ROAD MAP 282Objective Outline 282 Previewing the Concepts 282 First Stop: STC vs. Mobily vs. Zain 28316 ContentsWhat Is a Price? 285Major Pricing Strategies 285Customer Value-Based Pricing 286 Cost-Based Pricing 288Marketing at Work 9.1: Panera Bread Company: It's Not about LoW'Prices 289Competition-Based Pricing 291 ~* XOther Internal and External Considerations Affecting Price Decisions 292 VOverall Marketing Strategy, Objectives, and Mix 292 Organizational Considerations 293 The Marketand Demand 294 The Economy 295 Other External Factors 296Marketing at Work 9.2: Whole Foods Market: Price and Value in a Tighter Economy 297New-Product Pricing Strategies 298Market-Skimming Pricing 298 Market-Penetration Pricing 299Product Mix Pricing Strategies 299Product Line Pricing 300 Optional Product Pricing 300 Captive Product Pricing 301 By-ProductPricing 301 Product Bundle Pricing 302Price Adjustment Strategies 302Discount and Allowance Pricing 302 Segmented Pricing 303 Psychological Pricing 303 PromotionalPricing 304 Geographical Pricing 305 Dynamic Pricing 306 International Pricing 307Price Changes 308Initiating Price Changes 308 Responding to Price Changes 309Public Policy and Pricing 311Pricing within Channel Levels 312 Pricing across Channel Levels 312REST STOP: REVIEWING THE CONCEPTS 313v CHAPTER REVIEW AND KEY TERMS Objectives Review 313 Key Terms 315 DISCUSSIONAND CRITICAL THINKING Discussion Questions 315 Critical ThinkingExercises 315 MINICASES AND APPLICATIONS Marketing Technology 316 MarketingEthics 316 Marketing by the Numbers 316 Video Case 317 Company Cases 317Marketing Channels: Delivering Customer Value 318CHAPTER ROAD MAP 318Objective Outline 318 Previewing the Concepts 318 First Stop: Enterprise 319Supply Chains and the Value Delivery Network 320The Nature and Importance of Marketing Channels 321 How Channel Members Add Value 322 Number of Channel Levels 323Channel Behavior and Organization 324Channel Behavior 324 Vertical Marketing Systems 325 Horizontal MarketingSystems 327 Multichannel Distribution Systems 328 Changing Channel Organization 329Marketing at Work 10.1: Netflix: Disintermediate or Be Disintermediated 330Channel Design Decisions 331Analyzing Consumer Needs 332 Setting Channel Objectives 332 Identifying MajorAlternatives 333 Evaluating the Major Alternatives 334 Designing International DistributionChannels 334Channel Management Decisions 335Selecting Channel Members 335 Managing and Motivating Channel Members 336 EvaluatingChannel Members 337Contents 17Public Policy and Distribution Decisions 337Marketing Logistics and Supply Chain Management 338Nature and Importance of Marketing Logistics 338 Goals of the Logistics System 339 MajorLogistics Functions 339 Integrated Logistics Management 342Marketing at Work 10.2: UPS: "We Love Logistics"Put UPS to Work for You and You'll LoveLogistics Too 344 \REST STOP: REVIEWING THE CONCEPTS 346CHAPTER REVIEW AND KEY TERMS Objectives Review 346 Key Terms 347 DISCUSSIONAND CRITICAL THINKING Discussion Questions 347 Critical ThinkingExercises 348 MINICASES AND APPLICATIONS Marketing Technology 348 MarketingEthics 348 Marketing by the Numbers 348 Video Case 349 Company Cases 349Retailing and Wholesaling 350CHAPTER ROAD MAP 350Objective Outline 350 Previewing the Concepts 350 First Stop: Ramez Super Discount Store 351Retailing 352Types of Retailers 353Marketing at Work 11.1: Grocery Price Wars: Malaysian Style 357Retailer Marketing Decisions 361Marketing at Work 11.2: Trader Joe's Unique Positioning Twist: Cheap Gourmet 363Retailing Trends and Developments 367Wholesaling 372Types of Wholesalers ,373 Wholesaler Marketing Decisions 375 Segmentation, Targeting,Differentiation, and Positioning Decisions 375 Trends in Wholesaling 377REST STOP: REVIEWING THE CONCEPTS 378CHAPTER REVIEW AND KEY TERMS Objectives Review 378 Key Terms 379 DISCUSSIONAND CRITICAL THINKING Discussion Questions 379 Critical ThinkingExercises 380 MINICASES AND APPLICATIONS Marketing Technology 380 MarketingEthics 380 Marketing by the Numbers 381 Video Case 381 Company Cases 381Communicating Customer Value: Advertising and PublicRelations 382CHAPTER ROAD MAP 382Objective Outline 382 Previewing the Concepts 382 First Stop: Microsoft vs. Apple 383The Promotion Mix 385Integrated Marketing Communications 385The New Marketing Communications Model 385 The Need for Integrated Marketing Communications 387Marketing at Work 12.1: The Edinburgh Inspiring Capital Brand 388Shaping the Overall Promotion Mix 390The Nature of Each Promotion Tool 390 Promotion Mix Strategies 392Advertising 393Setting Advertising Objectives 394 Setting the Advertising Budget 395 DevelopingAdvertising Strategy 39718 ContentsMarketing at Work 12.2: Consumer-Generated Advertising: When Done Well, It Can BeReally Good 402Evaluating Advertising Effectiveness and the Return on Advertising Investment 407 OtherAdvertising Considerations 408Public Relations 410 *The Role and Impact of PR 411 Major Public Relations Tools 412 \REST STOP: REVIEWING THE CONCEPTS 413VvCHAPTER REVIEW AND KEY TERMS Objectives Review 413 Key Terms 414 DISCUSSIONAND CRITICAL THINKING Discussion Questions 415 Critical ThinkingExercises 415 MINICASES AND APPLICATIONS Marketing Technology 415 MarketingEthics 416 Marketing by the Numbers 416 Video Case 416 Company Cases 417^J Personal Selling and Sales Promotion 418CHAPTER ROAD MAP 418Objective Outline 418 Previewing the Concepts 418 First Stop: Nokia 419Personal Selling 420The Nature of Personal Selling 421 The Role of the Sales Force 421Managing the Sales Force 423Designing the Sales Force Strategy and Structure 423 Recruiting and SelectingSalespeople 426 Training Salespeople 427 Compensating Salespeople 428 Supervising andMotivating Salespeople 428Marketing at Work 13.1: B-to-B Salespeople: Who Needs Them Anymore? 430^ Evaluating Salespeople and Sales Force Performance 433The Personal Selling Process 433Steps in the Selling Process 433 Personal Selling and Managing Customer Relationships 436Sales Promotion 437The Rapid Growth of Sales Promotion 437 Sales Promotion Objectives 438 Major Sales PromotionTools 439Marketing at Work 13.2: Mobile Coupons: Reaching Customers Where They AreNow 440Developing the Sales Promotion Program 443REST STOP: REVIEWING THE CONCEPTS 444CHAPTER REVIEW AND KEY TERMS Objectives Review 444 Key Terms 445 DISCUSSIONAND CRITICAL THINKING Discussion Questions 445 Critical ThinkingExercises 445 MINICASES AND APPLICATIONS Marketing Technology 446 MarketingEthics 446 Marketing by the Numbers 446 Video Case 447 Company Cases 447A Direct and Online Marketing: Building DirectCustomer Relationships 448CHAPTER ROAD MAP 448Objective Outline 448 Previewing the Concepts 448 First Stop: Facebook 449The New Direct Marketing Model 451Contents 19Growth and Benefits of Direct Marketing 451Benefits to Buyers 451Marketing at Work 14.1: The Model for Direct Marketing in the Digital Age 452Benefits to Sellers 453Customer Databases and Direct Marketing 454* ^Forms of Direct Marketing 455 vDirect-Mail Marketing 456 Catalog Marketing 457 Telemarketing 458 Direct-ResponseTelevision Marketing 458 Kiosk Marketing 460 '*Online Marketing 460Marketing and the Internet 461 Online Marketing Domains 461 Setting Up an Online MarketingPresence 464Marketing at Work 14.2: Mobile Marketing: Customers Come Calling 470Public Policy Issues in Direct Marketing 471Irritation, Unfairness, Deception, and Fraud 472 Consumer Privacy 472 A Need forAction 473REST STOP: REVIEWING THE CONCEPTS 474CHAPTER REVIEW AND KEY TERMS Objectives Review 474 Key Terms 475 DISCUSSIONAND CRITICAL THINKING Discussion Questions 476 Critical ThinkingExercises 476 MINICASES AND APPLICATIONS Marketing Technology 476 MarketingEthics 477 Marketing by the Numbers 477 Video Case 477 Company Cases 477EXTENDING MARKETING 478The Global Marketplace 478CHAPTER ROAD MAP 478Objective Outline 478 Previewing the Concepts 478 First Stop: Google in China 479Global Marketing Today 480Looking at the Global Marketing Environment 482The International Trade System 482 Economic Environment 484 Political-LegalEnvironment 485 Cultural Environment 486Deciding Whether to Go Global 489Deciding Which Markets to Enter 489Marketing at Work 15.1: Coca-Cola in Africa: "Everything Is Right There to Have It Happen" 490Deciding How to Enter the Market 491Exporting 492 Joint Venturing 493 Direct Investment 494Deciding on the Global Marketing Program 495Product 496 Promotion 497Marketing at Work 15.2: Global Marketing: Watch Your Language! 498Price 499 Distribution Channels 499Deciding on the Global Marketing Organization 50020 ContentsREST STOP: REVIEWING THE CONCEPTS 502CHAPTER REVIEW AND KEY TERMS 502 Objectives Review 502 Key Terms 503 DISCUSSIONAND CRITICAL THINKING Discussion Questions 503 Critical ThinkingExercises 503 MINICASES AND APPLICATIONS Marketing Technology 503 MarketingEthics 504 Marketing by the Numbers 50,4 Video Case 504 Company Cases 505(n) Sustainable Marketing: Social Responsibility and Ethics 506CHAPTER ROAD MAP 506Objective Outline 506 Previewing the Concepts 506 First Stop: Siemens in the Middle East 507Sustainable Marketing 508Social Criticisms of Marketing 510Marketing's Impact on Individual Consumers 510 Marketing's Impact on Society as aWhole 514 Marketing's Impact on Other Businesses 516Consumer Actions to Promote Sustainable Marketing 517Consumerism 517 Environmentalism 518Marketing at Work 16.1: Walmart: The World's Super Eco-Nanny 522Public Actions to Regulate Marketing 523Business Actions toward Sustainable Marketing 523Sustainable Marketing Principles 523Marketing at Work 16.2: Socially Responsible Marketing: Making the World a Better Place 526Marketing Ethics 528 The Sustainable Company 531REST STOP: REVIEWING THE CONCEPTS 531* CHAPTER REVIEW AND KEY TERMS Objectives Review 531 Key Terms 532 DISCUSSIONAND CRITICAL THINKING Discussion Questions 532 Critical ThinkingExercises 533 MINICASES AND APPLICATIONS Marketing Technology 533 MarketingEthics 533 Marketing by the Numbers 534 Video Case 534 Company Cases 534APPENDIX 1 Company Cases A1APPENDIX 2 Marketing Plan A33APPENDIX 3 Marketing by the Numbers A45Glossary G1References R1Index 11


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