Session 1 (Fri, Sep 18, 2009)

Marketing Analysis and Evaluation

Part A. In the first half of our first regular session, we use the Federal Express (A) case as our
introduction to analyzing cases in marketing. Since we already know "the answer", we can focus
on analyzing Federal Express' situation with respect to customers, competitors, and company
strenghts and weaknesses. These analyses are then used in the formulation of a marketing
strategy for Courier Pak (CP) We will also focus on various quantitative analyses that might
inform our decisions. This is an old, old case, but it remains one of the best illustrations of the
entire range of marketing decisions and analytical possibilities. At the end of our discussion, we
can discuss more recent FedEx strategies.

Part B. Customer Analysis & Marketing Segmentation In the second half of class we take an
in-depth look at customer analysis. Developing strong value propositions necessarily requires a
deep understanding of customer wants and needs and customer decision making processes. In
this session, we discuss what we need to know as well as the methods we might employ to
answer our questions. We also introduce the concepts of market segmentation and targeting --
two of the cornerstones of marketing strategy.
Assignments

Conjoint Analysis (For discussion only on Saturday, Sept. 20; not to be graded)

Download the Conjoint Survey file from the course download area. Complete this survey, giving
each of the 16 product descriptions, or profiles, contained in it a rating that corresponds to how
likely it is that you would purchase the product described. Your ratings should be given in whole
numbers, not percentages. When you have your 16 ratings, download the Conjoint Data Excel
file from the course download area. Enter your 16 ratings in the yellow highlighted cells. Save
and keep a copy of this spreadsheet for discussion on Saturday, September 19. Place a copy of
the spreadsheet in the electric dropbox by Thursday afternoon at 5 p.m.
Cases

Federal Express (A)

Preparation Questions
1. What are the market needs fulfilled by CP? How large is the potential market for CP service?

2. Is CP a good marketing opportunity for Federal Express, i.e., is this an attractive market for
us? What makes it so?

3. If you think CP a good marketing opportunity for FedEx, how would you support and market
it?
* What is the appropriate price for CP? How do you know?
* How will you promote CP? Who is your communications target, and how will you reach them?
* What should be the role of the sales force vs. mass media?
* How much should we spend to promote this product?
Federal Express Exhibits

Readings

Part A.
1. Anderson, Narus and van Rossum, "Customer Value Propositions in Business Markets"

2. Ofek, "Customer Profitability and Lifetime Value". Reviews traditional and more recent
marketing metrics.

3. K&K, Chapter 1 and pps. 21-26 (Marketing and Customer Value), pp. 33-36 (the Marketing
Plan)

Recommended for those who need a review

4. "Note on Low-Tech Marketing Math". Provides some background information on basic

marketing terms (e.g., margin, contribution, etc.) and the calculations associated with them.

5. How Not to Get Lost in the Numbers". Provides some suggestions for thinking through what
numbers one would like to find and /or calculate.

Part B.
1. Simonson, "Shoppers' Easily Influenced Choices," A short discussion of some of the
complexities of consumer decision making.

2. Dolan, "Analyzing Customer Preferences:. A concise comparison of traditional scaling and

conjoint analysis as a way to measure preferences for product features.

3. Loveman, "Diamonds in the Data Mine," Harvard Business Review, May 2003. An account of
how customer information has increased profitability of Harrah's.