Principles of Marketing

ACTIVITY SHEETS

Activity 1

Objective: Discuss the meaning and characteristics of Marketing

Student Task: What is the the Role of Marketing?

One of the challenges you have at the start of a marketing program is to develop a nice and clear
understanding of the role of marketing.

As you have probably gathered, the word “marketing” is obviously related to the word “market”.
You should note that the word marketing is a verb, which means that marketing is an active
process of “going to market” (that is, helping a firm (or organization) go to market).

But what does “going to market” mean? Think about a street market where there are buyers and
sellers. The sellers work together to attract large numbers of buyers, but are also in competition
with each other to win sales from the buyers. The buyers are looking for a good deal and to buy
products that they are interested in.

Your task in this exercise is to review the following list. To what extent, do you think, that these
goals reflect the role of marketing for a firm. Try to score each one on this scale (Definitely a
role of marketing, probably a marketing role, probably not a marketing role or definitely not a
role of marketing).

1. To add value for consumers,

2. To win customers,
3. To outperform its competition,
4. To make a difference to society and
5. To achieve the firm’s other defined objectives.

Question: Given your view of whether the above goals are a role of marketing, how would you
then describe the role of marketing in your own words.
Activity 2
Perception of Marketing

This exercise is designed to explore how you and your fellow students perceive the role and
perception of marketing.

Listed below is a series of statements about marketing. Identify which ones do you agree with
and which ones you disagree with? When you have finished, compare your perceptions against
those of your fellow students .

(Please note that there are no right or wrongs answers – this activity is designed to explore the
range of perceptions of marketing held by different people.)

Please note that a variation of this activity can be played online at: Kahoot.it

ACTIVITY/TASK

1.   Marketing is simply another word for advertising.

2. The main goal of marketing is to maximize the number of customers, all other goals are
not as important.

3. People who are successful in marketing are really creative and outgoing – but are not that
good with numbers and statistics.

4. Marketers do not usually end up as CEO’s. Most CEO’s have a finance, engineering, or
legal background.

5. People in marketing roles tend to have little interaction with staff from other departments
(functions) within a firm.

6. Marketers tend to be seen as wishy-washy, because they are constantly changing their
minds.

7. Marketing is all about making people buy products who don’t really want them.

8. Marketing is a highly regarded profession throughout the business community.

9. Many key marketing decisions within a firm are so important that the CEO (or the senior
executive team) often undertakes them (rather than the marketing department).

10. Marketing tasks are fairly simple, particularly compared to complex and serious
roles/functions like finance and engineering.
 

QUESTIONS

1. Which of the above statements do you agree with?

2. Which ones are you not sure about?
3. Are your perceptions of marketing similar to your fellow students?
4. As perceptions of marketing sometimes differ in the business world, what implications
would this have for the profession of marketing?

Can a CFO run Marketing?

Preferred format: This teaching activity is designed to be completed in small groups of students
or as a class discussion.

Student audience: This exercise is more suitable for more advanced students of marketing,
starting to think about their marketing career.

Exercise time: The group discussion time should run 10-15 minutes.

Marketing has generally suffered from being seen as a “easy” area to manage. As a result, it has
been relatively common for executives perceived to be on the track to CEO level to be cross
trained as the company’s marketer. This is obviously created some resentment and lack of
opportunity for employees exclusively trained in the marketing area.

In 2015 – please see the related article – Twitter appointed their CFO to also run the marketing
area. As you should know, a CFO is primarily a numbers driven employee who is quite
interested in getting insights from the data.

No doubt there has been a significant shift in recent years from marketing being considered an
art form to becoming more analytically driven – so the appointment of the CFO to run
marketing, particularly in the online form, that have should not be a surprise.

Student Discussion questions

1. Other than having number expertise, is it possible that a CFO could bring other skills to
the marketing area?
2. Do you think that marketing is extensively a science/data task only, or is creativity still an
important factor?
3. To what extent do all marketers need to have a strong analytical understanding in today’s
technology driven marketing platforms?
4. Do you think that this CFO should come into marketing at a more junior level, or are they
ready to run marketing without experience?
 5. Do you think that a reverse situation would apply – that the senior marketing person
would be appointed to run the finance area (particularly if they were very strong in
statistics and analysis)?

Decoding Promotional Messages

Does marketing promote consumption for its own sake? Certainly there are some people who
gain status from their possessions. But is this the fault of marketing or just a general trend of the
changing environment? To assist you, listed below are some comments from a recent focus
group on this particular issue.

ACTIVITY/TASK

1. “I really don’t understand young people these days. Why do they want to tie themselves
down with all that debt? It must be so stressful. In my day, you saved your money and
only bought things when you could afford it. I’m proud to say that I’ve never borrowed
money in my life.”
2. “I earn good money. I’m not even 30 and I already earn $100,000. I’ve got another 30
years of ever increasing income to enjoy. That means I don’t need to worry about saving
– I just buy what I want, when I want.”
3. “I find that it’s my kids that want all the new things. Like the latest PlayStation, and their
own computer and a whiz-bang mobile phone and, of course, a wide-screen TV. I mean
all their friends have them, so you don’t want your kids to miss out.”
4. “I try to live a simple life, but that’s becoming harder and harder. For instance, how can
you live without a mobile phone these days? And I’ve recently bought myself a computer
for home just to access the internet.”
5. “I think things are quite different these days. Look at me for example – my wife and I
both have good jobs and we’ve decided not to have kids. That’s so different to my
parent’s generation where people usually only had one income and a family to support.”

QUESTIONS

1. Review the above statements; do you think that they are common viewpoints?
2. The statements seem to suggest that, in today’s world, many consumers want to buy more
products. Is this the result of marketing activities by firms or simply a change in
consumer’s lifestyle and expectations?
3. Do you see the level of per capita consumption as increasing or has it reached its
potential?
Decoding refers to how consumers will understand the marketing communication. In this
activity, you need to determine what is the main message for the following promotional
messages. Keep in mind that most ads do not include a lot of copy (text), so they often have to
draw conclusions or will use their existing perceptions
 

ACTIVITY/TASK

In a magazine ad for designer jeans

“Look good for a change”

On a sign in a chocolate shop

Spend more than $30 and receive a free* gift

(* Conditions apply)

In a new beer TV commercial

“Like no beer you’ve ever tasted before!”

On toothpaste packaging

“Great results for great teeth”

On a poster for a new movie

“One of the best movies I’ve ever seen”, Bill Jones, (a journalist for a small local newspaper)

QUESTIONS
 1. For each of the above examples, highlight how the communication message could be
interpreted in a positive manner.
2. Likewise, for the above examples, highlight how the message could be interpreted in a
somewhat negative manner.
3. Given that marketing communication is often brief, because of the limited perceptual
process of a consumer, do you think that the above communication messages will be
most likely interpreted in a positive or negative way?
4. How important do you think it is to pre-test advertising messages before they go to
market? Are there any disadvantages to pre-testing marketing communication materials?

The Role of a marketer

The aim of this exercise is to identify the likely tasks of someone in a marketing role. In other
words, what day-to-day functions do marketers perform?

Please review the list of business tasks outlined below. For each task, determine how likely it
would be for somebody in marketing (that is, they could be anyone in marketing, junior or
senior) to do this task as part of his or her role.

(Note: The tasks undertaken by marketers will vary across different firms, depending upon their
structure, corporate culture and marketing orientation. Therefore, approach this exercise by
using your understanding of the functions of marketing in general, rather than considering just
one firm in particular.)

ACTIVITY/TASK

1. Attend the weekly staff meeting and discuss recent sales results
2. Analyze the increase in the number of customer complaints
3. Brief the market research agency our research needs for the teenager market
4. Check the progress of our new store – review the design and its facilities
5. Write two articles for the company newsletter
6. Meet with an unhappy (dissatisfied) customer
7. Review the IT schedule and check the new product priorities
8. Provide some recommendations for the new staff bonus scheme
9. Meet with the accountant to recommend a 10% price increase
10. Attend the new product development meeting
11. Review the application form for new customer ‘sign-ups’
12. Meet with the local baseball regarding a sponsorship deal
13. Prepare a presentation for upcoming staff training day
14. Draft a speech for the CEO
 15. Draft the Chairman’s Report for the firm’s Annual Report

QUESTIONS

1. For each task, determine how likely (very, somewhat, unlikely) that someone in a
marketing role would undertake this function.
2. Given your answer to question 1, what skills are required to be a successful marketer?
3. Given your answer to question 1, how does the range of skills required compare to the
skills needed in other functional roles (such as accounting or IT)?
4. For someone in a marketing role, what skill set would be more important;
people/relationship skills, technical marketing skills, or creativity?
5. Does your view of a marketing role differ from the perception of your fellow students?

Are these Marketing Tasks?

For this exercise, review the list of work tasks below and identify which ones are likely (or not)
to be part of a marketing role.

For this activity, we will assume that the company in question manufactures cookies.

As you go through the list, consider at which “level” of employee (refer list in question area)
each of the decisions probably be made?

ACTIVITY/TASK

1. Which newspapers/magazines should we advertise in?

2.  Determining the total amount of the marketing budget?
3. Which product categories (cookies, snacks, candy etc.) should we offer?
4. What new products should we launch this year?
5. What training does our retail sales team need?
6. What campaign slogan to use for the launch of a new product?
7. Whether we should introduce a new flavor in an existing range of cookies?
8. What price should we charge for our products?
9. What geographic markets should we compete in?
10. What bonuses should be paid to sales staff?
11. What marketing research do we need?
12. How should we address the potential threats from new competitive product/s?
13. How can we motivate our sales team on a day-to-day basis?
14. Who should approve the annual marketing plan?
15. What level of production is required?
Understanding Customer Satisfaction 

This activity is designed to help you identify the key components of what drives customer
satisfaction outcomes. Listed below are a series of statements made by consumers regarding
their recent interaction with a firm. Quickly review each statement and determine how satisfied
each consumer is (using this simple scale; very satisfied, satisfied or dissatisfied).

ACTIVITY/TASK

1. “My friends dragged me to see that new movie. I didn’t want to go! I thought it was
going to be a stupid movie, but it turned out to be not too bad.”
2. “I got my old DVD player repaired as the picture always looked fuzzy. The firm fixed it
in a few days and met their $100 quote. Now the DVD works fine.”
3. “I was really excited about going to see the concert, but the seats were right up the back
and we were next to a bunch of loud and noisy people.”
4. “I couldn’t believe that the hotel only charged $100 for the night. They could easily
charge a lot more for what they offer.”
5. “I was so excited when I first saw vanilla flavored cola – I thought it would taste great,
just like cola and ice-cream. But when I tasted it, it was so bad that I couldn’t even finish
it.”
6. “I hired a floor polishing machine for the weekend. When they delivered it, we found it
was too big to get through the doorway. They took it away without charge, but I was
disappointed as I had previously checked with them that it would fit.”
7. “I had a real problem with my bank as they kept charging a wrong fee to my account.
When I went to see them they were really good about it, refunded the fee and apologized
and said that it wouldn’t happen again.”
8. “I went to McDonald’s the other day and it was a real surprise. I haven’t been there in
years and these days they have a good choice of food, nice coffee, and even comfortable
lounge chairs to sit in.”

QUESTIONS

1. How satisfied are each of the above consumers.

2. What factors seem to influence their level of customer satisfaction?
3. Given these factors, to what extent is customer satisfaction controllable?
4. Do you think that delivering satisfaction is harder for large firms, because consumers
expect more from them?
5. Given you answer to Q2, how valid is the cliche of ‘under-promise and over-deliver’?
6. Likewise, what are the implications of a firm ‘over-promising’ in their communications?

 
QUESTIONS

1. At what managerial level in the organization would each of the above decisions most
likely be made? (Choose from CEO/Executive, Marketing Manager, Marketing
Coordinator, or Non-marketing Manager.)
2. Given the likely range of managerial levels involved in these decisions, how important is
the role of communication in the strategy and planning process within a firm?
3. To what extent, do you think, it is possible to align the various marketing tasks
considering the various players involved?
4. Only around 50% of Fortune 500 firms in the USA have a Chief Marketing Officer
(CMO). Given the functions listed above, what challenges does NOT having the
marketing function represented at the executive level most likely cause for a firm?

What is Customer Value?

For this task you need to identify how each of the following consumers perceive value, based on
their statements listed below. You should note that the perception of value varies across most of
these consumers.

For each consumer statement, n this activity, identify how each of the following consumers
perceives value. (For example, value = low price, or value = good service, and so on.)

ACTIVITY/TASK

1. “I drive a BMW. Why? Because I always want the best, that’s important to me. I usually
buy high quality products.”
2. “I also drive a BMW, but I don’t really care about the car – I just want to show my
family, friends and neighbours how well I’m doing in life.”
3. “I like going to McDonald’s – it’s such great value – sure, the food isn’t that great, but
you get a lot for your money.”
4. “I’m happy to pay $200 for a pair of shoes – because they last for years. I really can’t
understand people who buy a $50 pair of shoes every six months.”
5. “I always buy my families clothes from either Target or Walmart (discount stores). Look,
a shirt’s a shirt – why pay more that you have to!”
6. “I won’t shop at those stores; they are very cluttered and too busy. I prefer to shop at
specialist clothing stores. They are quieter, they are much nicer to be in, and you can take
your time and comfortably try on clothes.”
7. “I still shop at the local butchers, rather than going to the big supermarkets. Sure, it’s a bit
more expensive, but the butchers are always friendly, you can have a laugh, and they
even tell you how to cook the meat if you’re not sure about it.”
 8. “I switched my loan from one of the big banks to a credit union. It’s going to cost me a
little bit more, but I know that I can trust them, I’m not sure about the banks anymore.”

QUESTIONS

1. What does each person consider to be ‘value’?

2. Are there any other ways of thinking about value to customers?
3. Which of the views about do you think would be common?
4. Given these range of views of what value is, what are some of the implications for
marketers?
5. Providing value to consumers is a cornerstone of success in marketing

Developing a Marketing Mix

In this exercise you are required to select the most appropriate marketing strategy (from a list of
four presented) and then develop a suitable marketing mix to implement that strategy.  This
activity will be focused on the strategy and marketing mix for a proposed new chain of Italian
and pizza restaurants. The four possible strategies currently being considered by the firm’s
investors are listed below.

ACTIVITY/TASK

Possible Strategy A

 Offer a unique range of high quality pizzas

 Use unusual ingredients (with choices such as oysters, kangaroo, avocado)
 Create innovative and unique pizza tastes
 Set new standards for pizza restaurants

Possible Strategy B

 Create a fun and exciting dining experience

 The restaurant should look and feel like a café in Italy
 Employ fun, outgoing and energetic staff
 Probably have a large outdoor dining area as well

Possible Strategy C

 Offer a very convenient service

  Aim to become the “McDonald’s” of pizza by offering very fast service (pizzas ready in
5 minutes and home-delivered inside 20 minutes)
 Mainly take-away and delivery options

Possible Strategy D

 Become the discounters of pizza

 Focus on operating a very lean and efficient business and compete mainly on price and
always undercut the competition
 Have a ‘value’ based positioning focus

QUESTIONS

1. Which of the four strategic options suggested would be the most effective in competing
in this market?
2. For the strategy that you selected in Q1, develop an appropriate marketing mix (for
example, what products should they offer, at what quality, with what ingredient choices,
and so on). You should either use the 4Ps or the 7Ps, whichever one you believe is more
suitable, (but ensure that your marketing mix will effectively deliver the proposed
strategy).
3. Do you think that this new pizza chain, as you have constructed it, will be successful?
Why?

Time for a New Positioning Slogan

This fitness center needs your advice. They are starting to think that their positioning slogan is
primarily responsible for their loss of new customers/members. Do you think it’s time for a new
slogan?

ACTIVITY/TASK

New Millennium Fitness Centers have the positioning slogan – “we’ll get you fit”. However,
only 50% of new customers keep coming back after the first six weeks.

This is a customer loss rate well above industry benchmarks, and also puts pressure on the firm
to consistently generate many new customers. Also, as many of these lost customers are
dissatisfied, they are probably negatively impact word-of-mouth referrals as well.

A consultant to the firm has suggested that the slogan could be contributing to the customer loss
problem because it “promises too much”. As a result, expectations are not met and customers
quickly become dissatisfied.
 

QUESTIONS

1. Do you think that the positioning slogan could be a problem? Why?

2. What could be a suitable revised slogan for them (if you think that they need to change)?
3. Should they change their slogan, or should modify their marketing mix offering instead?
4. Overall, how important is a positioning slogan to a firm? What is the for/against of using
a slogan?

From Situational Analysis to Marketing Analysis

While many industries have been impacted by the Internet-era, the banking sector is an industry
that has faced numerous environmental challenges. They have been impacted by new
competitors, changing technology, record low interest rates, different consumer buying
approaches, new distribution channels, and so on.

As a result, traditional banks cannot maintain their existing marketing strategy. They need to be
able to adapt to the current environment and find a suitable long-term strategy that will enable
them to achieve ongoing profitability.

YOUR TASK

For this task, you will be required to assume the role of the marketing manager for a hypothetical
mid-sized retail bank. You will need to identify the various trends and environmental impacts
that are affecting retail banking and then decide upon a suitable course of action – that is, a
competitive marketing strategy.

Because it is a hypothetical retail bank, you have some scope to determine “how” the bank will
compete. Obviously, you will have no real internal environment (corporate appraisal)
information to work with. But keep in mind, because they are a mid-sized bank, they will have
limited resources compared to the major banks. Therefore, they cannot match everything that a
large bank is able to do and offer.

Please note that the term “retail” in this banking sense refers to banking services offered to
individual consumers, not businesses or corporations.

What you need to do in this task is to find a way of both differentiating the banks offering and
adapting to (or taking advantage of) the various macro environment and competitive and
consumer trends. Ideally, you should be looking for the firm to have a distinctive and specialized
strategy that will allow them to stand out in the competitive landscape.

KEY BANKING ENVIRONMENTAL FACTORS

Interest Rates

In recent years, many countries have experienced low interest rates. This has placed pressure
upon the bank’s ability to generate profits through what is known as their interest rate margin. A
banks margin is the difference between the interest they pay out to depositors and the interest
they receive from borrowers.

In a lower interest rate environment, there is generally pressure to reduce this margin. This
occurs through competitive pressures, as well as the inability for the bank to reduce the interest
rate it pays on savings accounts (because often they are around 0% anyway) – so when they
reduce their loan interest rates, there unable to match it with a decrease in the interest rates that
they pay out.

This dampening of their interest rate margin (revenue) has forced many banks to look for cost
savings and efficiencies through technology.

Substitute Competitors for Deposits and Savings

Interest rates for larger deposits are now typically quite low. Consumers with significant amounts
of money to invest and now able to get better “interest rate” returns by investing in blue-chip
shares, where the dividend may be much higher than banking deals.

This means that the low interest rate environment, has made blue-chip shares a more viable
“substitute competitor” for larger savings and deposits.

Substitute Competitors for Loans and Credit Cards

Not only do banks face competition for generating savings and deposits, they also have
significant competition in trying to attract borrowers.

There has been an emergence of “payday” lenders. These types of organizations provide very
small loans – usually under $1,000 – for a short-term emergency period. Collectively, they have
managed to grow to a reasonable market size, which takes many small loans away from banks.

In some countries, major supermarket chains have launched their own credit cards. They already
have significant access to consumers who regularly use various credit cards at their stores. These
retailers are able to use personal selling methods in the store along with various forms of digital
and email marketing to push credit cards onto the supermarket customers.

Additionally, other retailers such as department stores may also offer “store cards”, which
operate like a credit card within that particular store. Credit cards usually provide a good form of
profit for banks, so these retail competitors pose a threat to this business.

Some other retailers may offer “interest-free repayments” for major purchases. This means that
the consumer can buy – say furniture – with free credit from the retailer. Obviously, the “free”
credit is usually embedded in the purchase price or provided by the base manufacturer of the
product. Either way, it provides an attractive alternative to borrowing money from a bank.

In a similar vein, many new cars are now sold with very low interest rate offerings – which are
provided by the car manufacturer (or in some cases by a large dealer). This means that it is very
difficult for a bank to compete in the new car lending market.

Therefore, as you can see that banks are facing numerous challenges from array of competitors.

Substitute Competitors for Transactional Business

Most consumers would have some everyday transaction account where money goes in and out.
New competitors have emerged in this regard, such as Apple Pay. Samsung, Google and
Amazon also have products (either existing or planned) which are designed to take transactional
business away from banks.

While typically there are not significant profits to be gained from holding transactional business
(due to the smaller account size and the transactional costs involved), transactional business does
provide a key “relationship” between the bank and consumer. Therefore, losing this particular
offering would potentially put the balance of the customer relationship at risk.

Although not a mainstream concern at the moment, in the longer-term alternative digital
currencies (such as Bitcoin) they also pose a threat to a bank’s ability to hold its customer
relationships.

Mortgage/home loan Brokers

A growing proportion of mortgage loans are delivered through independent mortgage brokers.
These are “usually” independent firms that research the best home loan offerings in the market.
Many consumers prefer this way of purchasing a home loan because it is at no cost to them (the
bank will pay a commission to the broker) and the broker does all the work for the consumer.

The downside of this arrangement for a bank is that they will have loyal customers using a
broker who is more than likely to place the consumer with another financial institution. Also it
means that the bank has to be constantly competitive with its interest rate offerings and its
commissions to brokers.

Online Interest Rate Directory Comparison Sites

Like many industries, banking consumers will undertake their own research prior to a major
purchase decision (such as a mortgage or a large deposit). There are numerous interest rate
comparison sites in the market that compare all or some of the offerings available. This means
that, as with mortgage brokers, banks have to be increasingly price and package deal
competitive.
These interest rate comparison sites usually make their income through offering advertising or
sponsored positions on these sites. The financial institutions will usually pay per click, in the
same way as they would with Google advertising.

Again the concern for a bank is that there is a reduction in overall consumer loyalty, particularly
for larger transactions, and the availability of online comparison sites creates increased price
sensitivity among consumers.

Decline in the Importance of Bank Branches

Online banking is becoming quite common. In the old days, bank branches were widely located
and were the main tool for acquisition of new customers. However, a branch’s effectiveness in
this regard has been significantly reduced through alternative methods of customer acquisition.

This creates a significant cost structure for a bank, particularly competing against new entrants
which may have adopted an online-only model. The challenge remains of how to “reinvent”
bank branches away from transactional facilities to sales and relationship facilities. There are
many different types of branch design models that have been tried throughout the industry.

Fraud Issues

With many consumers moving to online banking, there is a growing threat from the risk of fraud
for consumers. There are some organized groups who seek to trick consumers into revealing
their passwords (through fake emails and/or fake websites representing banks) or some other
form of hacking the consumer’s computer system.

Therefore, banks need to invest in appropriate technology and staff – at a cost – to minimize the
risk of fraud in order to protect their brand’s security image with the market. In some cases,
banks will be liable for the loss of money and will have to repay it to the customers.

Increasing Legislation

Following the GFC period, where banks were perceived to be reckless in some of their activities,
there has been an increased scrutiny by governments on financial institutions. This has resulted
in increased regulation, compliance, restrictions, and the need for greater financial capital.

Collectively, these measures usually have the effect of increasing the bank’s cost of compliance,
as well as limiting its growth potential in certain areas.

Economic Outlook

Interest rates have already been discussed above, but many countries face reduced economic
growth prospects in future years. This reduces the ability of the bank to grow “naturally” with
the size of the economy (with larger incomes and wealth).
There is also increasing income inequity in many countries. This may create a situation for a
bank where they may need to have distinct offerings for both wealthier and poorer consumers.

Social Media Use

Many consumers tend to be heavy users of social media, across various platforms. Social media
provides a good opportunity for organizations to create brand engagement, strengthen customer
loyalty, leverage customer advocacy, and win new/first-time customers.

However, while this may be generally an attractive marketing and promotional opportunity,
banking is usually not seen as an overly exciting type of brand to engage with. So the challenge
here is to how to make a bank’s brand “interesting and engaging” while still maintaining the
appearance of security and stability expected from a bank.

Customer Database Analytics

Marketing is moving towards more data-driven decisions. Banks have an enormous amount of
customer information on their customer database. Not only do they have precise demographic
information, but they also are able to generate a very clear picture of their customer’s lifestyles
and behavior through analysis of their financial purchases.

Many banks are gaining an advantage through the analysis of their customer database,
developing precise target market segment profiles, and even engaging in predictive behavior
modelling. This information can then be fed into the firm’s promotional activities, hopefully with
much greater cost and result effectiveness.

Other Environment Factors?

There are also other environmental factors worth considering, which you may choose to identify
through further Internet research.

The Role of Logos

Teaching Notes for this Activity

In this activity, students will consider the role of a logo in the firm’s overall brand – what role
does it play, how important is it?

Student task

Below are some well-known logos to review.

1. Which logos can you recognize?

 2. Why do you think that these logos were designed this way? That is, what are they trying
to communicate?
3. Are logos just used for quick recognition – or do they try to “tell a story” about the
brand?
4. Which logos, do you think, are the better ones? Why?
5. How often (if at all) should successful brands change/fine-tune their logo design?
6. In addition to a brand’s logo – what are some other brand elements (colors, shapes,
slogans, sounds) that are also important to use?
7. Do you think that every brand needs a logo? Or are logos more important in certain
industries only?

Communicating to Gen Y

Teaching notes for this activity

This discussion exercise would work best in small groups, getting students around 15 – 20
minutes to work through the questions and the issues.

Student task

The following is a summary/excerpt from a study on Millennials – otherwise known as Gen Y –

and their view of marketing communication from banks. Review the following article and then
answer the questions at the end.

Millennials don’t like the way banks communicate.

Many Millennial consumers believe that their primary financial institution doesn’t send them
marketing materials that interest them. Nearly half (46%) said their bank does not send
marketing materials that are relevant to a future financial need. Two in five Millennials also
complain that the offers they do receive aren’t personalized.

“I get a lot of advertising stuff from Wells Fargo,” bemoans one of the bank’s Millennial
customers in a video from FICO on YouTube. “It just goes in the trash… immediately. I don’t
think my bank understands me as a human being. [My bank] is just a hole where I throw my
money into.”

Somewhat paradoxically, nearly 75% of Millennials say they don’t receive too many offers from
their bank, so they are open to more communication.
Millennials might say they would be receptive to more communications from their bank, but
only if they’re sent via one of their top four preferred channels: (1) email, (2) text message, (3)
bank website, and (4) bank’s mobile app. And yet 43% of Millennials don’t think that their bank
communicates to them through their preferred medium/device.

In the FICO video, another Millennial consumer echoed this sentiment: “[My bank] still sends
me stuff in the mail, which is weird and annoying, and I don’t want that.”

Source: 50 Revealing Facts About Millennials and Their Money

Discussion questions

1. Do you think that the views expressed here for this generation would also be similar
across other industries (other than banking)?
2. Banking relies upon building customer relationships and cross-selling products to
existing customers – so how important do you think it is to get the
promotion/communication mix offering right?
3. If you were a marketing manager for a bank, how would you use the information in the
above article to influence your marketing activities?
4. Based upon the above article and your general knowledge, develop a segment profile (a
description of the segment and their needs) for the Millennials.

The Internal marketing Environment

Teaching notes for this activity

In this exercise, students will look at the role of the internal marketing environment when
developing a marketing strategy.

This activity is best completed in small groups, with a report back to the main class. You should
allow around 15 minutes for discussion.

Student task

The internal marketing environment refers to INSIDE the organization itself, in order to help
design an appropriate marketing strategy based upon the position and resources of the firm.

When analyzing the internal marketing environment we would consider: resources, capabilities,
corporate culture, management style and leadership, track record of success, current strategy, and
so on.

However, it is often common that firms neglect an internal marketing environmental analysis and
instead focus on the micro environment almost exclusively.
The micro environment consists of: consumers, competitors, suppliers, distributors – the players
that make up the industry in which the firm competes. In particular, marketing strategies tend to
be built around consumer needs and competitors – but is this the right approach???

Discussion Questions

1. In your opinion, to what extent does the firm’s marketing strategy need to be based upon
the firm’s internal environment?
2. Why do you think firms tend to focus more heavily on the micro environment in order to
structure and design their marketing strategy?
3. If firms rely solely upon the micro environment for their marketing strategy development,
with this mean that all firms would end up very similar marketing strategies?
4. Think about the components of a SWOT analysis. Where would the internal environment
most likely be represented in the SWOT?

An Entrepreneurial Start Up

Teaching Notes for this Marketing Activity

This student discussion exercise is built around a video (at the bottom of this page) where the
founder and CEO of the Dollar Shave Club discusses how the business was built and has been
made successful.

Please note that you should watch the video first before deciding to show it in class to see if it is
appropriate for your students!

This can be conducted as a general class discussion, or as a discussion in small groups – it should
run around 15 minutes or so.

Student Discussion Questions

1. What are the key benefits of the razors – as presented in the video – that would provide
the incentive for new consumers to switch from their existing brands and start ordering
through the Dollar Shave Club?
2. The founder said his background was in marketing, how important do you think
marketing experience is in becoming a successful entrepreneur?
3. As discussed in the video, many of their decisions in the firm’s growth phase were made
on a fairly quick and ad-hoc basis – do you think this is a common approach or should the
firm have been more structured and organized when it came to their strategic planning?
4. How important was the viral video in the success of the firm overall?
5. If the founder did not have a standup/acting background, do you think that the video
would become viral?
6. Given a viral video was made from a firm selling razor through the mail, to what extent
can viral videos be successfully developed for virtually any industry or product?
The Most Valuable BRANDS in the World 
Teaching Notes for this Marketing Activity
This marketing exercise is designed to look at the most valuable brands in the world – as
highlighted by the BrandZ top 100 for 2015.

Additional resources: Here Are the Top 100 Brands in the World

Student task

As you probably know, brand equity is becoming increasingly important factor to successful
brands. Brand equity has the ability for firms to to gain additional market share, at a price
premium, with increased customer loyalty, and greater acceptance of new products. It also
provides significantly more access to more retailer channels and easier ability to enter new
markets.
Professional valuation companies that rank firms on the brand equity value consider how much
the brand contributes to additional profitability. Here are the top 10 brands for 2015 as
determined by Millward Brown.

1.  Apple
2. Google
3. Microsoft
4. IBM
5. Visa
6. AT&T
7. Verizon
8. Coca-Cola
9. McDonalds
10. Marlboro

Student Discussion Questions

1. Most professional brand valuation firms consider the impact of brand’s contribution to
overall profitability to measure brand equity, rather than softer emotional metrics, such as
likability – do you agree with this profit-focused approach?
2. Have a look at the top 10 brands in the world, what similarities can you see in regards to
their marketing activities?
3. Only a few years ago Coca-Cola was the most valuable brand in the world, a position it
had held for a long time. Do you think it is possible for Coca-Cola to every regain the
number one spot?
4. How is it possible that the Marlboro (cigarette) brand is still in the top 10 most valuable
brands in the world – given it is prohibited from advertising in many countries?
Therefore, to what extent do you think that advertising spend influences overall brand
equity?
Product Levels 

Teaching Notes for this Marketing Activity

Preferred format: This teaching activity is designed for small groups of students to split two
products into the five product levels.
Student audience: This exercise is more suitable for students of introductory marketing.
Exercise time: The group discussion time should be around 10-15 minutes, plus any additional
time for an overall class discussion.
Additional resources: A helpful page of information of the three-level and five-level product
models is available on another website.

Student Task

Most marketing textbooks will show products as having three distinct levels, namely the core
benefit or need, the actual product itself, and the augmented product. However, in some more
advanced marketing textbooks, this model is expanded to include five different product levels,
with expected product and the potential product added to the model, as follows:

 Core product (main need or consumer benefit)

 Actual (or basic) product (design and features)
 Expected product
 Augmented product
 Potential product

Let’s quickly recap each of these five product levels.

Core product
The core product is the basic need or benefit that the product is trying to meet or deliver. The
best way to think about this is from a consumer’s perspective – why is the customer buying this
product solution? For example, why does a consumer buy a magazine? Because they find them
entertaining or it prevents boredom or fills time. Therefore, the core product for a magazine is
entertainment.

Actual (or basic) product

The actual product is that the overall product design. If you were to describe a product in detail,
then you would be describing its product features, which is the actual product. As an example,
consider breakfast cereals – when describing the cereal you would highlight; shape, taste,
texture, size, color, aroma, crunchiness, smoothness, ingredients, packaging, name, brand,
images, and so on.

Expected product

The expected product considers the basic expectations of the product from the consumer. The
expected product becomes the checkpoint for a marketer to consider the completeness of the
product offering. If we visit a fast food restaurant, then the expectations would include: friendly
and fast customer service, restroom facilities, clean tables, security and a feeling of being safe,
and so on.

Augmented product

The augmented product is the additional supporting services and features that increase the set of
benefits available to the consumer. Again, using a breakfast cereal example, we could add extra
value and benefits through product augmentation by: having recipe ideas on the packaging,
provided a code to access free online games, and so on.
Potential product

The potential product considers how the product can be modified in the future, in order to
generate future sales from existing customers. We can do this through product improvements and
enhancements over time, which will provide some form of additional benefits to the consumer.
An example might be joining a fitness center with a five-year membership contract. The
consumer could be attracted to this deal because the fitness center has plans to add new facilities
and services over time.

Discussion Questions

1. Pick two product categories – one should be a physical good and the other should be a
service.
For each product that you have selected, outline how the five product levels could be
structured (similar to the examples listed above).
2. In your view, how helpful is it for a marketer to split the product into its different product
levels?
 3. Do you think that the five-level product model has any extra value to a marketer, as
compared to the three-level product model?

Which Marketing Orientation Is Best?

In the following activity, you are presented with an excerpt of a discussion from a manager’s
meeting for a newly formed firm that is setting up as a manufacturer of bicycles. Essentially,
they are discussing which marketing orientation/philosophy they should adopt. Your task is to
determine which orientation/philosophy that you think would be most appropriate approach for
this firm.

ACTIVITY/TASK

James:

As you all know, I’ve been a keen cyclist for many years. And I think that there’s a real
opportunity for innovative state-of-the-art bikes. There’s always someone out there who wants
the latest gadget. We’ve all seen that in the entertainment market (with PlayStation and iPod for
instance). So I think that we can easily pick up on that trend in the bike market.

Julie:                    

Sure, that’s an option, but you’re talking about a pretty small market. I think that we should go
mass market. These days some kids own two or three bikes, or get a new one every year. Success
in that large market is simply price. If we make the bikes efficiently and sell them at a low price
– then the bikes will roll off the shelves as fast as we can make them.

John:

Yeah – maybe that will work. But today’s world is celebrity and brand crazy. For many kids
today, it’s all about image and status. So I think that we should get a high-profile celebrity to
endorse our product, and then get out there and really build a strong brand. This is a real
opportunity – I mean, you can list a dozen brands of cereal, but how many brands of bicycles do
you know?

Jane:

But do people really choose a bike based on the brand? Or do they choose a bike that really suits
them and has a good range of features. You know what I think – I think we should run some
focus groups with kids, teenagers, and young adults and find out what they really want in a bike.
Meeting customer needs is the key to success.

Jenny:                  
Well, of course, we should meet customer needs! But wouldn’t it be great if we could make a
difference to the environment as well. You know, encourage people to cycle (not drive)
whenever they can. And we could also generate a lot of free publicity by using this approach.

QUESTIONS

1. Which marketing orientation/philosophy is each person essentially referring to? (Choose

from the list below.)
2. Based on the information you have, which particular orientation do you think that the
firm should follow? Why?
3. Which orientation approach do you think is adopted by most large firms?

 Production Concept
 Product Concept
 Sales/Promotion Concept
 Marketing Concept
 Societal Marketing Concept

Understanding Marketing Orientation

In the following exercise, you are required to identify which Marketing Orientation/Philosophy
(see list in question area) that each firm most appears to follow, based on the statement that they
have made on the way that they focus and operate in their particular organization.

ACTIVITY/TASK

1. “It’s a old saying, but it’s true – ‘build a better mouse-trap and the world will beat a path
to your door’. And that’s exactly what we do! Our products are always being enhanced
and improved upon and, quite simply, they’re the best on the market.”
2. “We’re very focused on understanding our customers and meeting their needs. And you
have to be. For example, 30 years ago our firm used to manufacture typewriters – well
nobody buys them anymore. Therefore, to be successful you have to adapt and
fortunately our whole firm is committed to that goal. And it’s working, last year we
achieved both record profits and record customer satisfaction scores.”
3. “We’re an importer of various products that are suited to direct marketing promotion. In
particular, we are heavy users of late-night TV info-commercials. Our approach is simple
– find fun, novelty or self-improvement products from overseas, import them, and them
effectively promote them.”
4. “In today’s world, running a successful business is quite a complex challenge. It’s a real
balancing act to constantly provide a fair return to our shareholders, whilst meeting the
 ever-changing needs of the consumers. And we also do this within our requirements of
working with environmentally-friendly technology and materials, as well as giving
something back to the community. But it’s a challenge that we really enjoy.”
5. “At our firm, we are very cost-focused and we have worked hard to become a lean
organization. We believe that if we can make and distribute our products very efficiently,
then we can always sell cheaper than our competitors, and hence we will sell more and
make more money.”
6. The Body Shop is a large retail chain throughout many countries. As part of their
business philosophy, they will only deal with ‘ethical’ suppliers (for instance, ones that
have fair employment practices).  It is also important to them that they contribute to good
causes and that their products are environmentally friendly.
7. Some companies are very focused on innovation and technological break-throughs. And
some will even disregard poor market research concept test results if they really believe
in their product. These firms understand that new technology often takes time to be
adopted by consumers. (For instance, mobile phones were initially only adopted by
businesses, and much later by consumers.) Therefore, they create a great product first,
and then they try and create a market.
8. The Salvation Army is a high-profile charity that helps thousands of people annually
through its many programs and various forms of support. However, to provide such
extensive support, they need significant donations from individuals and businesses.
Therefore, throughout the year they conduct many fund-raising lunches with business
people, have significant direct marketing programs in place, generate significant amounts
of publicity, and even conduct advertising.
9. For many years, there has been a trend of manufacturing firms deciding to physically
produce their goods internationally, in countries where labor costs are significantly lower
(such as China, India, Mexico). This trend is now extending to basic services as well. A
good example is the firms in India that provide ‘outsourced’ telephone call-center
services to large companies, such as banks and insurance companies. These Indian call-
centers firms often win their new business primarily on the basis of offering a low price.
Therefore, they continually focus on containing costs and improving efficiency in order
to grow their business.
10. Burger’s Galore is an organization that gathers a lot of information regarding its service
levels and how their customers perceive them. Their corporate culture is highly customer
focused and they work hard to meet the changing needs of the market.

QUESTIONS

1. Which marketing orientation/philosophy does each organization most appear to follow?

(Choose from the following list.)

 Production Concept
 Product Concept
 Sales/Promotion Concept
 Marketing Concept
  Societal Marketing Concept

2. Do you think that there is one best marketing orientation/philosophy that firms should fo

What is Marketing?

Our task in this exercise is to construct our own definition of marketing. To assist in this regard,
some different views of what marketing is have been presented below.

Therefore, your first task in this activity is to firstly review the various views/definitions of
marketing in the conversation below. Then see if you can come up with your own definition of
marketing (based on some of these views and your general understanding of marketing). Try not
to use a standard textbook definition – instead see if you can construct a suitable definition of
marketing in your own words.

ACTIVITY/TASK

Vicki: To me the answer is pretty straightforward – marketing is all about working out
how you can get consumers to buy more products from your firm.
Susie: That’s fine, but how do you actually do that? I think marketing is the various
tasks that you undertake to get consumers to buy more, such as having special
offers and developing great new products.
Natalie: But is it just about getting people to buy more? For instance, McDonald’s could
get people to buy more Big Macs if they started selling them for only $1 – I’m
not sure that they would really want to do that.
Paul: No they wouldn’t – they would want to increase profits, not sales. That’s why in
their marketing they train their staff and continuously open more stores, which
have lots of seating and parking, as well as having playgrounds and drive-thrus.
At McDonald’s, their marketing all about convenience and service.
Mitchell: Sure, McDonald’s do all that, but they focus on value as well. For just $6 you
can get a burger combo. So I think that a key part of marketing is having a low
price.
Jay: But hang on a bit, there are firms that like to charge high prices. For example,
with an expensive restaurant, having high prices is a sign of the quality of the
food and their service.
Mike: And those types of restaurants don’t even need to advertise. They gain new
customers through their reputation and word-of-mouth.
Bianca: You know what you’re talking about is having a strong brand. That’s what I
think marketing is all about. A good example is BMW. Their cars are a status
symbol, so people are willing to pay more to own one.
Barry: So what you’re saying is the key to marketing is lots of advertising in order to
 build a strong brand so consumers will pay more and buy more.
Julie: But isn’t it more than just advertising? To build a strong brand, don’t you need to
start with a good product first? There’s no point advertising something that
people won’t buy again. So I think marketing starts with a good product.
Charlie: But to have a good product, you first have to understand the customer and their
needs. If you do that right, then you know what products they want, how much
they will pay, and how to advertise. So I think the key to marketing is truly
understanding the consumer and meeting their needs.

 QUESTIONS

1. What are the key points about marketing highlighted in the above conversation?
2. What other points do you think should be included?
3. Therefore, how would you define marketing?
4. How similar/different are the marketing definitions constructed by your fellow students?

Understanding the Product Growth mix

Your task in this activity is to classify the examples listed below into one of the four categories
on the  product/market growth matrix (also sometimes referred to as Ansoff’s model). You will
need to consider whether it is a new or existing product and market for the firm. A diagram of
the product/market growth matrix has also been provided below to assist you.

ACTIVITY/TASK

1. A wholesaler plans to double their retail sales team and sell more to their existing
customers
2. A shoe manufacturer is considering developing other products that may be of interest to
their existing retail customers (such as socks, belts, shoe polish, hats, caps, etc.)
3. A specialist health food firm (that now only sells directly to end-consumers) is looking to
introduce a new product range in order to gain access to chemists shops
4. Kmart stores are planning to use  more frequent discounts to attract more new customers
and to sell more products to their existing customers
5. McDonald’s are planning to further broaden their product range to appeal to a wider
market
6. A successful accounting firm is just about to open their first international office
7. A local plumber is thinking about buying a hardware store that is currently for sale
8. A large real-estate chain has just set-up an internet site that helps people, who are
buying/selling property, to find qualified service providers in their area (such as, lawyers,
accountants, movers, cleaners, and so on)
9. A small winery (who just makes and sells wine) is considering opening up a small
restaurant on their property
 10. A local Chinese restaurant has expanded its menu to also include Vietnamese and Thai
food
11. A major law firm has doubled the number of seminars and conferences that it holds each
year, in an attempt to win more business
12. A university/college has started running correspondence courses for the first time

QUESTIONS

1. How would you classify each of the examples into the product-market growth matrix?
2. Which of the four options would most firms tend to rely upon most frequently for their
growth? Which option would be least used? Why?
3. How helpful would this matrix be for firms in planning their growth options and related
strategy?

Using the BCG Matrix

In the following mini-case study, you are required to categorize the corporation’s business
portfolio into the four boxes of the BCG (Boston Consulting Group) model. You then need to
decide how the management should allocate $250 million funds available across their strategic
business units (SBUs), using the BCG matrix as a guide.

ACTIVITY/TASK

The AHI Group is a hypothetical diversified firm operating in Australia. Created less than 20
years ago, AHI has clear goals of strong growth and achieving dominance in all the markets that
it chooses to compete in. The corporation now has four SBU’s, as follows:

1. A chain of fast food restaurants (General Manager = Clive)

2. A manufacturer of MP3 players  (General Manager = Kristi)
3. A ‘branding’ marketing consulting firm (General Manager = Therese)
4. A bus travel company (General Manager = Jamie)

It is strategic planning time at AHI and each of the General Managers are outlining their resource
requirements with the founders.  (Note: There is $250m available to reinvest into the business.)
The following are some excerpts from the minutes of the meeting:

Clive:
“My fast-food division is the only one that is making any real profits – over $500m last year. It’s
clearly obvious that we need to reinvest in THIS business. Let’s expand and grow the profits. As
usual, we’re facing significant challenges from new competitors, so we really need the
investment.”

Kristi:

“That’s fine, but you’ve got limited growth potential. OK, we’re not making much money now,
but this market is too big to not pursue it properly. So we need the $250m to help catch up to the
leaders, as they’ve got a big start. That way we can generate potential huge future profits.”

Therese:

“Kristi, you’re too far behind the market leaders of Apple. I don’t see the sense in throwing
money into something where we will probably end up in a weak position anyway. Whereas our
branding marketing consulting business is growing really well. We’re consulting throughout the
world and are considered to be one of the market leaders with our innovative practices. Sure,
we’ve got lots of infrastructure costs, but this is going to be a future goldmine. We’ll make more
than the fast food chain in five years time.”

Jamie:

“We’re in a tough market that’s pretty flat at the moment. I know we only make a few million
dollars a year, which is small time for the rest of you. But it’s a big market, and we could use the
investment to somehow improve our position.”

QUESTIONS

1. How would you classify each of AHI’s business portfolios using the BCG matrix?
2. How would you allocate the $250m investment across the SBUs?
3. How useful did you find the BCG matrix in helping allocate the $250m investment?
4. Are there circumstances where the BCG matrix could be misleading (that is, suggest an
investment in a low potential SBU for instance)?
Preparing a SWOT Analysis

This case study looks at a hypothetical regional bank. Your task here is to prepare a SWOT for
the firm; that is, identify their strengths, weaknesses, opportunities and threats. As a result of
this exercise, you should have a much clearer idea of what marketing strategies would best suit
them, given their current environment.

ACTIVITY/TASK

Beautiful Sunny Valley region, home to just over 10,000,000 people. The Sunny Valley Bank
had started several decades ago and had achieved a 20% share of the adult banking market
(around 1,500,000 customers). They now had 50 branches throughout the region, which has been
a key driver of their success (that is, being very convenient). They also had the advantage of
being the ‘local’ bank. They were friendly and truly concerned with helping their customers.

According to their marketing manager, “While our success was initially due to the convenience
of our branches, in later years our closeness and “smallness” became a major point of difference
over major banks. As a result, many of our new customers came from word of mouth”.

However, they do have their limitations for their customers (which explains why they only have
20% market share). For instance, they have a limited range of products (such as not having a
credit card). And in recent years, there’s been a big change in technology. People now access
their accounts through ATMs,  phones and the internet – so banking customers don’t necessarily
need the convenience of branches, or the service that goes with it (particularly in these time-poor
days). Therefore, what was once a ‘strength’ (of many branches), may have become a
‘weakness’ (cost of rent and staff).

Adding to this pressure has been the rise in specialist competitors. Today, loan brokers
aggressively target the profitable loans business, and firms like American Express, Citibank and
Virgin targeting credit cards business, plus places like ING Bank chase low transaction/high
balance savings.

As a result, the bank found themselves in a little bit of a strategy ‘mess’ and had decided to
‘reinvent’ themselves to be more competitive in today’s market. Their proposed changes include:

  More heavy focus (positioning) on being the local bank (‘there for you, as always”)
 Introducing customer relationship management (CRM) programs, including appointing
“personal bankers”
 Creating a ‘selling is helping the customer’ corporate culture
 Working their existing customer base harder (getting greater “share of wallet”)
 Utilizing local retailers to help gain increase market share
  Having a heavier emphasis on electronic/remote channels (such as internet and the call
center), and
 Introducing a more competitive range of products – starting with a credit card

QUESTIONS

1. Prepare a top-level SWOT analysis for the bank.

2. Given your SWOT, to what extent do you agree with their proposed strategy? Why?
3. How would you change/improve their proposed strategy?