Foundations of Marketing

Lecture 1
What is Marketing?
The science and art of exploring, creating and delivering value to satisfy the needs of a
target market at a profit. Kotler, Keller et al (2019)
The achievement of corporate goals through meeting and exceeding costumer needs better
than the competition. Jobber and Fathy (2006)
Marketing is the activity, set of institutions and processes for creating, communicating,
delivering and exchanging offerings that have value for costumers, clients, partners and
society at large. AMA (2017)
Marketing is a social and managerial process by which individuals and organisations obtain
what they need and want through creating and exchanging value with others. Kotler and
Armstrong (2006)
What is a Market?
Various groups of customers who buy products or services.
All customers and potential customers who share a common need that can be satisfied by a
specific product, who have the resources to exchange for it, who are willing to make the
exchange and who have the authority to make the exchange (Solomon, Marshall, Stuart,
Barnes and Mitchell (2009)

Types of Marketing
1. Business to business B2B
2. Business to consumer B2C
a. FMCG Fast moving consumer goods (small items)
3. Direct to consumer BTC/ B2C
The evolution of Marketing

Production orientation: Stems from the Industrial revolution when items where individually
crafted/largely hand made which made them expensive. However, with the development of
mass production they focused on speed and efficiency and consumers accepted products that
were less than perfect and did not totally meet their needs
Sales Orientation: It took placed in the mid 20th century and assumed that
customers/consumers will not buy anything unless they are persuaded to do so. Success was
achieved through aggressive sales techniques. Rather short term strategy.
Market Orientation: Market Orientation is the organisation-wide generation of market
intelligence pertaining to current and future customer needs, dissemination across
departments, and organisation-wide responsiveness to it’. (Kohli and Jaworski, 1990).
  What happens when you lose your market orientation? Brands like Blockbuster
and HMV did not listen to their costumers needs meaning that they started consuming
other brands like Netflix or Spotify.
Benefits of a Marketing Orientation
In general, organisations that adopt a market orientation perform better in the market
(Pulendran et al. 2002, Avlonitis and Gounaris 1999)
Disputed by Kaur and Gupta (2010)

 Move from ‘efficiency’ to ‘effectiveness and efficiency’

 Positive contribution to innovation
 Enhanced customer satisfaction
 Positive contribution to organisational evolution
 Supports innovation and organisational longevity
Criticism Of Market Orientation
There have been a number of criticisms attached to the concept of marketing and a ‘market
orientation’
• Doesn’t take into account wider societal issues (Wensley 1990)
• Limits innovation (Tauber 1974)
Challenges to a market orientation
• Is a ‘market orientation’ appropriate for everyone?
• Slow moving markets vs fast moving ones (modas that go and come)
• What do we mean by ‘market’?
• Internationalisation
• Market fragmentation
• Stakeholders
Marketing Myopia:
The mistake of paying more attention to the specific products a company offers than to the
benefits and experienced produced by these products.
Lecture 2- Using a Market Audit to Inform a Marketing Plan
A Marketing Plan

SWAT= Strengths, weaknesses, opportunities and threats.

Marketing Audit: a systematic approach of assessing marketing opportunities, helping

organisations to stay in touch with marketplace trends and to keep abreast of costumer needs.
The means by which a company can:
 • Understand how it relates to the environment in which it operates
• Identify its own strengths and weaknesses as they relate to external opportunities and
threats
• Help management to select a position in the environment

What do they do?

 Carefully watch the business/marketing environment
 Spot potential opportunities and threats
 Identify and built upon their strengths
 Rectify their weaknesses
 Protect against and counter internal vulnerabilities
 Protect against and counter external threats
 Exploit those new opportunities faster than competitors
Structure of a Marketing Audit

Whenever you want to take a Marketing audit you always start with the big picture (macro)
and then go into the detail (micro).
Marketing environment: the actors and forces that affect a company’s capability to operate
effectively in providing products and services to its customers”
The macro Environment
A number of broad forces that affects not only the company, but also the other actors within
the ‘micro’ environment.
In the main, companies have no influence over the elements within the ‘macro’ environment.

Example of major economic ‘macro’ factors that impact upon business…

 Economic cycles – boom versus recession
o National, worldwide
o Competitor nations
o ‘linked' nations (i.e. through the EU)
 Inflations/ unemployment
 Interest rates
 Exchange rates
Example of environmental/natural ‘macro’ factors that impact upon business…
 Pollution
 Climate change
 Sustainability
  Scarcity/availablilty of resources
o Types of ‘natural resources’?
Examples of social/cultural factors
 Demographic changes
o Population size/structure
o Level of education/skills
 Lifestyle changes
o Work/life balance
 Changes in family structure
 Cultural forces
o Multiculturalism/religion
o Changes in cultural norms
Technological Factors
 Digital Technology
o Increased speed
o Interconnectedness (IoT)
o Portability
 Medical advances
 Miniaturisation
o Nano-technology
The Micro Environment
The factors in an organisation’s immediate environment that affects its ability to operate
effectively
Organisations do not work in a vacuum and are affected by everything around them
By all means start with an ‘internal audit’ but don’t forget the other factors in the
environment.

A Model for Looking at the Company’s Relative Strenghts: Porter’s Value Chain (1980)
• What do we ‘do’? (Hint: think
Theodore Levitt!)
• Who are our competitors?
• What do we do well (i.e.
competitive advantage) ?
• Do we add value in all areas?
• What is our capacity for
innovation?
• How do we retain our expertise?
• How sound are our finances?
A Model for Analysing the Micro Environment: Porter’s Five Forces (1985)

A word about researching macro and micro factors

 Make sure that you use credible sources
o Government/market reports
o Scientific/academic journals
o Credible media reports
o Reports from authoritative sources
 NGOs
 Charities and other NFPs
 Cross check facts by using multiple sources to make sure of correctness and
credibility
 Use up to date sources
o Ideally less than 12 months old.
 DON’T just use the first internet site you find.
SUMMARY
 A systematic analysis of the factors affecting an organization and its ability to
respond to it is an essential foundation for any marketing strategy.
 Through an understanding of both macro and micro factors is it possible to
identify trends that might either threaten the position of an organization or
generate opportunities for new products/services and/or new markets.
 Reflecting upon these trends, it is essential to take an objective and reflective
evaluation of the ability of an organization to respond to these trends.
 Priorities then need to be set based on Critical/Key Success Factors identified

Async 2
Why macro and then micro?
1. It puts your analysis in context ‘big picture’
2. It’s time efficient/avoids duplication
a. first you identify factors that affect every member of a given sector
b. then you identify specific factors that affect your organization

To analyse the insight organisation, you can use Porter’s methods.

TOWS vs SWOT
 A TOWS is a variation on the SWOT but takes analysis a step further
 It is more strategic and analytical than a conventional SWOT
o SWOT identifies strengths and weaknesses in isolation- descriptive
o TOWS considers strengths and weaknesses within the context of the factors
that generate opportunity and threat and is therefore more analytical.
TOWS is used to identify both defensive actions and ‘market shaping’ strategies in the form
of ‘Critical (Key) Success Factors.
Critical success factors are those actions that should be taken to secure the future of an
organisation. As Jobber noted, having an understanding or knowledge of critical/ key success
factors is seen as an essential precursor to the development of an effective competitive
strategy.
TOWS FACTORS

TOWS FACTORS- McDonalds

Other threats: veganism and vegetarian movement

Other Opportunities: create more healthy food, create vegan options
Other weaknesses: global thought that the food is bad quality and unhealthy
Other strengths: it is very popular, they have adapt demographically.
What do you use TOWS for?
Create a matrix to match up strengths to opportunities,….
CRITICAL (KEY) SUCCESS FACTORS
Keeping these questions in mind, what action must be taken to secure the future security and
growth of the business?
 Are there any reoccurring themes?
 Which are the most important opportunities?
 Which are the most serious threats?
And then:
 Do we have the resources/ expertise? (can we afford it, if not how can we get the
resources)
 What do we have to do next?
‘SWOTS” are used in all sorts of contexts and for all sorts of purposes. Be very
critical of the ‘SWOTS’ on websites- often key aspects are incorrect!

Lecture 3- CUSTOMERS AND CONSUMERS

Costumer: The party which acquires, or agrees to acquire, ownership (in the case of goods) or
benefit or usage (in the case of services) in exchange for money or other consideration under
a contract of sale.
Professional purchaser specialising in a specific group of materials, goods or services and
experienced in market analysis, purchase negotiations, bulk buying and delivery
coordination.
Consumer: The person who uses the goods or services
(Businessdictionary.com)
THE CUSTOMER JOURNEY
Stages in the Engel, Blackwell and Miniard (1993) consumer decision making process model
FACTORS THAT INFLUENCE CONSUMER BEHAVIOUR
1. Culture (Kotler et al 2019)
a. The fundamental determinant of a person’s wants and behaviour
b. The shared meanings of most people within a social group
c. Provide the blueprint for behaviour through shared norms and values
2. Family or household decision making
a. The household is the basic consumption unit for most consumer goods.
i. Ex: Houses, cars, appliances are often consumer by households rather
than individuals
ii. Expenditure on one item within a household can divert funds from
another (new kitchen vs holiday)
b. The family life cycle has been an accepted indicator of consumption behaviour
in sociology since 1936 and marketing since 1955.
i. Attitudes and behaviour tend to change over the course of an
individual’s life
ii. Key life events are more significant drivers of change…
Traditional Family Life Cycle

3. Self-Concept
a. We are comprised of multiple selves
i. Actual self ‘me as I am’
ii. Ideal self ‘the good me’
iii. Negative self ‘that is so not me’
iv. Looking glass self ‘how I’d like other to see me’
v. Extended self ‘me as part of a wider group’
4. Reference Groups
a. Definition
b. Types of reference groups
i. Associative vs Dissociative (linked with negative self)
ii. Membership vs Aspirational
 iii. Formal vs Informal
WHAT ABOUT B2B?
Participants in the Organisational Buying Process
All members of an organisation who play any of five roles in the purchase decision making
process: users, buyers, deciders, influencers, gatekeepers.
Buying decision Approaches (Robinson, Faris and Wind – 1967)
 Straight rebuy
 Modifies rebuy
 New task
STAGES IN THE BUSINESS BUYING PROCESS

MAJOR INFLUENCES ON BUSINESS BUYER BEHAVIOUR

Increasing influence of the Internet on B2B

Procurement directly affects the performance and efficiency of the supply chain.
E-precurement: Refers to the integration of procurement process which includes…
Not all decision are the same… 3 TYPES OF DECISION
CHARACTERISTICS OF DECISION-MAKING TYPOLOGIES

Async 3
CUSTORMER JORNEY AND SOURCES OF INFLUENCE
The costumer journey… Stages in the Engel, Blackwell and Miniard (1993) consumer
decision making process model

Level of information search depends upon the type of decision:

 Routine Response Behaviour (compulsive buying- without thinking)
 Limited problem solving (you already have some information but is searching for
discounts, offers, etc)
 Extensive problem solving (you don’t have a lot of information and the level of risk is
high)
Factor affecting information search
1. Internal search
a. Amount of pre-existing knowledge
b. Experience with similar products/services
c. Previous experience
2. External search
a. Lack of pre-existing knowledge
b. Level of personal expertise
c. High level of involvement
d. Quantity of information available
e. Ease with which information is accessed
f. Perceived level of source credibility of information sources

Reference Group: individuals or groups that a consumer might align themselves with or
compare themselves against for informational purposes.
 Normative
 Comparative
  Informational
 Utilitarian
 Value-expressive

Factors that influence the level of reference group influence

 Visibility of product, service or brand
 Level of relevance or importance to the group
 Knowledgeability/expertise of the consumer
 Level of confidence held by the consumer
 Degree of difficulty accessing or finding the good
Evaluating alternatives
What are the evaluative criteria?
What are the heuristics, market beliefs and country or origin effects? For example, German
cars are good quality, this is a market belief.
Familiar brands, brandy loyalty and habitual purchase?
What are the product signals?
What are the risks?
The 6 issues of perceived Risk (Jacoby and Kaplan 1972)
1. Monetary risk- relative price consideration for the consumer
2. Functional risk- will it do the job?
3. Physical risk- what is the potential for harm to the consumer or others? Ex. Is that car
safe?
4. Social risk- what will other people think of it?
5. Psychological risk- is it aligned with the consumers values, self-concept etc,?
6. Time- is it worth the time invested?
Decision Rules
1. Non-compensatory decision rules: when you want to buy something and you are
looking for options, you prioritise characteristics like a good camera on a phone. If
the characteristics are not there, you won’t buy it
2. Compensatory decision rules: you have a list of the priorities you want like a good
camera but perhaps the battery doesn’t last for too long. Does it compensate the other
priority?
The influence of ‘shopping styles’
Sproles and Kendall’s (1986) model of eight consumer decision-making styles
1. Perfectionist, high-quality decision-making style
2. Brand conscious, “price equals quality” decision making style
3. Recreational/hedonistic shopping decision making style
4. Rational/ price-conscious, “value for money” decision making style
5. Impulsive, careless decision-making style
6. Confused by over choice decision making style
7. Habitual/brand loyal decision-making style
8. Novelty fashion-conscious decision-making style
Lecture 4- SEGMENTATION, TARGETING AND POSITIONING
The STP process
1. Segmentation- The identification and grouping of individuals or organisations with
similar characteristics that have implications for marketing strategy
2. Targeting- The choice of which markets to pursue
3. Positioning- Positioning is the identification of a place in the market that responds to
the identified consumer/customer need in a way that offers competitive advantage
Why segment..?
 A key strategic tool in Marketing strategy

The segmentation process

Segmentation bases
 Profile- Demographic, socio-economic, geographic, etc
 Behavioural- Benefits sought, purchase occasion, purchase behaviour, usage
 Psychographic- Values, Lifestyle, Personality
 demographic
 geodemographic
 lifestyle

Segmenting B2B markets

Criteria for a successful segmentation

4 requirements:
 1. Distinctiveness- … if not segment boundaries become too blurred and there is a risk
that offerings will not be sufficiently well tailored to attract the required customers.
2. Tangibility- A segment must be of a sufficient size to make its pursuit worthwhile.
3. Accessibility- Accessible both from a distribution and communications points of
view.
4. Defendability- Can the organization develop a sufficiently strong differential
advantage?
Targeting: evaluating the relative attractiveness of segments
 Market factors
o Relative market strengths (Porter’s 5 forces)
o Price sensitivity
o Segment size
o Segment profitability
 Political social and environmental factors
o Political issues
o Social trends
o Environmental issues
o Cultural drivers
 Capability
o Exploitable marketing assets
o Cost advantages
o Resource envelopes
o Technological edge
o Managerial capabilities and commitments
Targeting marketing strategies
 Differentiated marketing- A differentiated marketing strategy is one in
which the company decides to provide separate offerings to each different market
segment that it targets.
 Undifferentiated marketing- involves marketing to the entire market the same
way. Mass marketing effectively ignores segmentation and instead generates a
single offer and marketing mix for everyone. The market is treated as a
homogeneous aggregate. 
 Customised marketing- With this approach, companies offer consumers a
product created to their individual specifications. 
 Focused/niche marketing- is a strategy that targets only one or a few very
defined and specific segments of the consumer population. The goal is to achieve
high penetration among the narrowly defined target segments. 
Positioning (Ries and Trout 1986)
The aim is to achieve a unique position in the mind of consumers
 Clarity
 Credibility
 Consistency
 Competitiveness
Perceptual Maps
Identifies gaps in the market (not all gaps are opportunities), identifies position in the market
(clarifies brand position) and identifies potential competitors.
1. Identify a set of competing brands
2. Identify the distinguishing attributes within a category
 3. Plot each of the brands on a two-dimensional map
Async 4
PERSONAS
What is a persona? (Atherton 2020)
It is a detailed profile of core differentiating attributes of a particular audience segment. It’s
was know as a archetype, is a typical example of a segment of a market. It’s not a stereotype
(that is a simplified segment)
It is usually given a name and appears in the form of a ‘pen portrait’
In order to be effective, it should be grounded in as much real market data as possible (we
should not use poor quality information).
In archetypes you can find Paint points or frustrations are the thing that really annoy someone
and would put a person to choose another brand.
Why create a persona?
Traditional market segmentation is often undertaken using demographic data which is
insufficient for the creation of an effective marketing plan.
 Who vs who, what, when, why, where, how much?
Persona’s make it abstract question more answerable. You need to put yourself in the shoes
of your persona.
How to create customer persona (with actual real-life data)
Customer personas are detailed representations of segments within your target audience.
Fueled by data-driven research, they map the “who” behind the buying decisions of your
products or services.

Buyer personas are research-based archetypal (modeled) representations of who buyers

are, what they are trying to accomplish, what goals drive their behavior, how they
think, how they buy, and why they make buying decisions
We should focus on:

 Behavioral drivers. These encompass your customers’ goals, what they want to

accomplish, and their journey to finding your business.
 Obstacles to purchasing. Take into consideration the hesitations and concerns of
your customers. How do they view your product or service? How does that impact
the information they need to make a decision?
 Mindset. Your customers come to the buying experience with expectations and
preconceived notions. Are they shoppers who want the thrill of the bargain, or do
they expect a refined experience? Selling a weight-loss program will be more
emotionally charged than, say, selling routers.

To understand segments of your customer base and what motivates them, begin by asking
them questions. There are three ways to get started.
1. Conducting surveys online or off with open-ended questions is critical to
understanding how your customers frame their motivations and needs. The goal is to
get inside your customers’ heads and make sure your personas are based on
what real people think, not just your idea of what they think.
2. Phone and in-person interviews. Talking to your existing customers can provide
valuable information into their buying habits, what motivates them, and the words
they usecto describe your product or service.
 3. Web and exit surveys. These surveys are designed to have a single question pop up
on your site at a designated time. They’re particularly good for finding out why your
customers aren’t completing a purchase.
Start with the classic bases of segmentation (demographic, geographic, geodemographic,
behavioural, psychographic and lifestyle)
But there are other ways to segment the market:
4 Needs-based segmentation: what is the need to be satisfied?

 Biogenic need: what the customer needs to survive i.e food, drink, warmth, sex
 Psychogenic need: what the customer needs to support their sense of
self/identity- linked to the value system. i.e you value education, you choose to
go to university
 Hedonic need: the need for sensory pleasure i.e taste, touch, sight, sound, smell
 Utilitarian need: the need to solve practical problem i.e the tap drips, find a
plumber
Types of behaviour (Lay 2014)

 Transactional behaviour
o Insight into how customer/consumer shops and buys as well as interacts with
vendors and intermediaries to achieve different tasks.
o Like method of payment, use of credit, extent to which costumer is
promotion-drive (since they tend to switch brands based on offers)
o Showrooming and webrooming
 Showrooming; searching instore and buying online
 Webrooming: searching online and buying instore.
 Psychographics (drives behaviour choices)
o insights into personality, values, attitudes, interests and lifestyle of members
gained form the review of transactional data, social data or the use of
progressive profiling.
 Digital behaviour
o Provided insight into what members and consumers are doing on digital
channels and social networks. Digital behaviours can be found by using
unique tracking cookie placed on an individual’s computer.
Types social networks and online communities
Preferred products and vendor types
Values
Cultural factors plays a central role in the evolution and development of ‘values’.
A ‘value’ may be defined as a ‘belief about some desirable end-state that transcends specific
situations and guided the selection of behaviour’
 Core values- are the basic set of values imparted by a specific culture.
 Value system- is the ranking of values within a specific culture
Values tend to vary culture from culture.
Rogers’ Diffusion of Innovation Theory (1962)
Lecture 5
Marketing Mix (4Ps)
What is a product?
‘Anything that is offered to a market for attention, acquisition, use or consumption, and
includes physical objects, services, persons, places, organisations and ideas or mixes of these
entities’.
Anything that is capable of satisfying customer needs.
Can include organisations, persons, places and ideas, too
(e.g. politicians, celebrities, destinations and social marketing campaigns)
The total product offer (anatomy)

Mondelez’s product mix

The individual products within the product line is a product item. The product mix width is
the combination of line and products in your company.
Products have lifecycles…
 Introduction:
o growth slow, profitability low because of high development and promotional
costs.
 Growth:
o faster growth in sales and profit grows. Competitors enter market.
 Maturity:
o sales peak, profitability strong as initial start up costs covered.
 Decline:
o changes in consumer taste or new products/services that satisfy needs enter the
market.

Product decisions
 determine the total ‘product offer’…
 … product quality and features, style and design, branding, packaging and labelling
support services
 Identify not only the functional benefits deliveres by the product, but also the
emotional and psychological benefits delivered by the bran
 Think about the stage of the product in its life-cycle (launch, , growth, harvesting and
divestment) – different mix tactics are appropriate at different stages
 Product decisions are inseparable from other mix decisions

‘Place’: where, when, in the right form and in the right quantitates
  Often referred to as the ‘channel of distribution’, ‘route to market’ or ‘supply chain’.
 Takes into account the needs of the ultimate consumer but also the channel
intermediaries.

Distribution channels for consumer goods

Distribution channels for B2B goods

Types of distribution
 Intensive- where you are trying to get as wider distribution as you can. With intensive
distribution, consumers have always access to your products.
 o Penetrate the market
o As many outlets as possible
o No cap on stores or locations
 Selective- sometimes, you want to make sure that you won’t be sold in a particular
shop. They choose specifically their location to be sold making sure that they follow
their target values. Limit amount of units.
o Specific locations
o Limited numbers of stores
o Target consumer
 Exclusive- only very few units, only people who are granted for exclusive distribution
are able to sell this products, associated with high-end brands.
o High-end and exclusive brands
o Limited outlets
o Particular locations
Distribution choices create powerful communication touchpoints and incur cost and pricing
implications.
Promotion
• Increasingly referred to as ‘integrated marketing communications’ (i.e. no longer just
about promoting and persuading)
• A planned and integrated set of activities for communicating with each of an
organisation’s stakeholder groups
Defining Marketing communications
• ‘Is used to communicate elements of an organisation’s offering to its target audience
• ‘Is a management process through which an organisation engages with its various
target audiences’
Marketing communications is concerned with engagement: the planned, integrated and
controlled dialogues with key target audiences to help achieve mutually beneficial objectives.
The power of three…
• Three elements:
• tools (e.g. advertising, sales promotion, personal selling, direct marketing and
public relations);
• media (TV, radio, press, internet, etc); and
• message
• Three main audiences:
• customers (consumers or end user organisations);
• channel members (suppliers, wholesalers, retailers, etc);
• general stakeholders (e.g. community, shareholders).
• Three types of media:
• Paid – paid for media (i.e. TV & radio advertising, paid endorsements)
• Owned – websites and social media channels owned and managed by the
organisation.
• Earned – word of mouth and shared content.

The challenge of communication strategy

What does marketing communications actually do?
 Communicate the marketing ‘offer’/ USP to the target audience(s)
 Recruit new consumers and retain existing ones
 Reinforce previous positive brand experiences
 Reassure consumers in the face of an impending or following a recent transaction
THE ‘DRIP’ ELEMENTS OF MARKETING
COMMS
• D – Differentiate
• R – Reinforce
• I – Inform
• P – Persuade

Macroms can be used to achieve a number of cognitive and behavioural changes

 Brand repositioning
 Changing misunderstanding
 Building credibility
 Changing performance beliefs
 Changing attribute priorities
 Introducing a new attribute
 Changing the perception of a competitor’s product
 Changing/introducing new brand associations
 Using corporate branding to extend credibility

Promotional Tools
 • Advertising – non-personal form of communication, where a sponsor pays for a
message to be transferred through media; capable of reaching a large audience; aims
to raise awareness and position product in consumers’ minds
• Sales promotion – direct inducements or incentives to buy a product or service;
concerned with offering additional value in return for a(n immediate) sale (e.g.
sampling, coupons, deals)
• Public relations (PR) – influences stakeholders’ perceptions of an organisation;
doesn’t require the purchase of airtime or advertising space, therefore low-cost and
perceived to be more credible (e.g. press releases, shows, networking, lobbying, etc)
• Direct marketing – drives a response and shapes behaviour by sending personalised
and customised messages; used to create and sustain personal, intermediary-free
communication with (would-be) customers and significant stakeholders
• Personal selling – interpersonal communication that provides information, develops
positive feelings and stimulates required behaviour; undertaken by individuals or,
collectively, a salesforce; very potent (if biased), but reach is limited
• Plus sponsorship – ‘a commercial activity whereby one party permits another to
exploit an association with a target audience in return for funds, services or resources’
The media
• Broadcast – TV and radio
• Print – newspapers, consumer magazines, trade press
• Outdoor – billboards, street furniture, transit (e.g. on public transport)
• Digital – websites, social media (e.g. Facebook, Instagram, Tiktok Twitter), etc
• In-store – point of purchase (bins, signs, displays), packaging
• Other – cinema, exhibitions, product placement (e.g. in films), ‘ambient’ (e.g. on
petrol pumps), ‘guerrilla’ (e.g. flyposting)
An integrated marketing communications approach…
• involves bringing together the tools, the media and ideas about how messages should
be developed ...
• ... so that audiences perceive a single, consistent and unified message (even though
individual messages will be encoded in different ways, emphasising different types of
appeal and using different media)
• More effective and efficient than using any one tool or medium in isolation

Async 5
Pricing
Price is a measure of value to both buyers and sellers. Price serves as a visible expression of
the value to be exchanged and enables buyers and sellers to negotiate and agree on that value.
‘Pricing’ is the management of price.
Pricing objectives
Profitability- they are thinking about which price will cover the cost with a profit margin
Long term prosperity- not only to get a profit, but generating in that profit in order to get
more in the future for its long term prosperity.
Market share- if you place your product too high the customers may fall apart, but also if you
price it too low you might not cover all expenses.
Positioning- the recognition in the marketing such as premium brands
Economic Pricing
There is a relationship between the price and the quantity you sell. However, there is some
problems.

Practical problems
 Difficulty in plotting demand curve accurately
 Curve is based upon estimation
 Modelling requires cooperation of retailers
o Reluctant to release commercially sensitive information
 Bir regional differences
 Price elasticity (is the extent to which demand will increase given a price rise)
There is 3 main approaches to pricing..
1. Cost based pricing

There is a slight issue with that, when you use this method you don’t have into account what
is the value your customer is willing to pay for that. Also, it does not take into account your
competitors.
2. Competitor-rate pricing

3. Market oriented pricing

 The Product Life Cycle: price changes over time

Price skimming
When you can charge high margins for your products
Conditions for charging high prices
 Product provides high value
 Customers have the ability to pay high prices
 Consumer and bill payer are different
 Lack of competition
 Excess demand
 High pressure to buy
 Switching costs (from a company to another)
Penetration pricing
When you charge low prices when you are introducing a product in the market
Conditions for charging low price
 Strategic objective is market penetration or market domination
 Predation (‘predator pricing’)
 Make money later (consumer ‘lock ins’)
  Make money elsewhere (complementary products/services)- nespresso capsules sell
their machines with capsules for cheap because you can only use expresso capsules
which are expensive.
 Create barrier to entry
Pricing existing products

Promotional Pricing
BOGOF (buy one get one free), price discount, coupons, bulk offers, cash back
But there is also a problem in promotional prices, is that consumers will only look at the sales
currently on.

Differential pricing
A pricing strategy in which a company sets different prices for the same product on the basis
of differing customer type, time of purchase, etc. also called discriminatory pricing, flexible
pricing, multiple pricing and variable pricing.
However, it has to be managed very carefully because it can cause discontent between
customers since everyone pays a different rate and can create a bad reputation into the brand.
Ethical issues

Deceptive prices is when Ryanair for example offers a £10 flight but when you add all the
extras it can be much more expensive.
Price fixing is when 2 or more companies work together to secure their margins at the
expense of consumers, so consumers are paying more than necessary.
Lecture 6
THE MARKETING MIX PART 2: SERVICES
Is everything truly a product or a service?
Service: is an intangible product involving a deed, a performance or an effort that physically
cannot be possessed. (Dibb and Simkin 2013)
Nature of services (adapted from Hoffman and Bateson 1997) characteristics

1. Intangibility
 Difficult for the customer to evaluate
 Customer does not take physical possession
 Difficult to advertise and display
 Difficult to set and justify prices
 Service process is not usually defended by patents
Ex: insurance
2. Inseparability of production and consumption
 Service provider cannot mass produce services (economies of scale)
 Customer must participate and comply in production
 Other customer can affect service outcomes
 Services are difficult to distribute and replicate
3. Perishability
 Services cannot be stores
 Very difficult to balance supply and demand
 Unused capacity is lost forever
 Demand may be very time sensitive
4. Lack of ownership
 There is no transfer of ownership
 Access to service is often time limited
5. Heterogeneity
 Service quality is difficult to control
 Difficult to standardize service delivery
6. Client-based relationships
 Success depends upon satisfying and keeping customers over the long term
 Generating repeat business is challenging
 Relationship building becomes critical
 Service providers are critical to delivery
 Requires high levels of training
Extended marketing mix for services or 7Ps
 Product
 Price
 Promotion
 Place (distribution)
 People
  Physical evidence
 Processes
The original 4Ps (for services)
 Product
o Treat services as products (with recognisable life cycle, etc)
 Price
o Often a means by which customers judge service quality, in the absence of
something to touch or feel
 Promotion
o Make the intangible tangible (physical evidence, benefits, etc)
 Place (distribution)
o Two issues here, - reservations and information systems, and the
simultaneous nature of production/consumption.
The extra 3 Ps
 People
o … represent the service provider, and have a significant impact on perceived
quality, recruitment, training and rewarding of staff is key (for most services)
 Physical evidence
o Examples include sales literature and brochures, staff uniforms and
architecture, some services use more physical evidence than others
 Processes
o defined as the tasks, schedules, activities and routines that enable the service
to be delivered (e.g. getting a haircut)

Not all services are the same!

The nature of the service act
 Tangible (eg. Car repair, health care)
 Intangible (eg. Higher education, financial services)
The recipient of the act
 People (eg, hairdressing, entertainment)
 Things (eg, dry cleaning, gardening)
Goods-services continuum.
(where does the product end and the service begin?)

Service mix, examples…

 Pure Product- examples include salt, sugar, etc
 Product with some services- appropriate for technologically sophisticated products
such as cars (showrooms, warranties)
 Combination- equal proportion of products and services, as with the case of a
restaurant (table service complements food)
  Service with some products- latter a complement to the former (e.g. food and drink,
wifi and stationery in a hotel)
 Pure service – where there are no products involved (e.g. legal advice, counselling)
People count…
The intangibility of the service ‘product’ means that ‘people’ have a major influence when it
comes to consumer loyalty.
 Recruitment of people with strong interpersonal and presentational skills
 On-going training and development is essential
 Maintenance of employee motivation is hugely important
 Systematic evaluation is required
Factors Influencing Customers’ Evaluation of a service encounter

Factors that influence customer retention

Measuring Service quality (jobber 2007)

Async 6
Packaging- Interview with Paul Jenkins
Packaging is it the 8th… P?
As a fundamental definition of packaging is to protect the inside contents. Some brands like
apple, would invest on packaging to communicate their brand values. For products that are
high value, packaging becomes a big role to play.
Nice packaging can open up to the gifting market and allow you to charge more for your
products.
Currently, the packaging innovation is related to sustainability and reducing plastic.
Lecture 7
INTEGRATED MARKETING COMMUNICATIONS
It is part of the 4P, Promotion.
Marketing Communications:
The process of establishing a commonness or oneness of thought between a sender and
receiver. Schramm (1957)
‘Is used to communicate elements of an organisation’s offering to its target audience’. Fill
(2009)
“is a management process though which an organisation engages with its various targets
audiences’. Fill (2009)
Is concerned with engagement: the planned, integrated and controlled dialogues with key
target audiences to help achieve mutually beneficial objectives. Dahlen, Lange and Smith
(2010)
Communication: Transmission of meaning

Allbirds example

Touchpoints (Eagle et al 2020)

Every point that a customer/consumer comes into contact with the brand
 Thinking of Adidas, where do you come into contact with brand or brand
communication?
Social media, ads, seeing a guy with adidas shoes in the street, sport events, etc.
Communication type at its most basic level…
The traditional communications toolbox

Digital Platforms

What do marketing communications actually do?

 Communicate the marketing ‘offer’ /UPS to the target audience(s)
 Recruit new consumers and retain existing ones
 Reinforces previous positive bran experiences
 Reassure consumers in the face of an impending or following a recent transaction
The “DRIP” elements of marketing communication
D- difference
R- reinforce
I-inform
P- persuade
The AIDA Model… (Strong 1926)
Is one of the oldest models.

Macroms can be used to achieve a number of cognitive and behavioural changes

Traditional communications vs IMC (eagle et al 2020)

So what is IMC?

Five key features of IMC (Shimp 2000)

Challenges associated with creating an IMC campaign

Async 7
Creativity and IMC
Creativity should be seen as the production of novel and useful ideas by an individual or by
groups working in concert. Amabile (1988)
Originality, newness or appropriateness.
Creativity emerges from a combination of novelty, meaningfulness and ‘connectedness’.
What does creativity actually do?
 It overcomes perceptual barriers
 It increases involvement
 It facilitates engagement
 It encourages cognitive processing/ cognitive learning
 It encourages ‘ad liking’
 It has direct links to ‘wear in’ and ‘wear out’.
The role of creativity
Creativity is a ‘means to an end’, which, within the context of IMC, means to successfully
effect a change in either attitude or behaviour on the part of the target market.
 Maximising the chance that the target consumers will actually take sufficient notice of
the message for it to be effectively received.
 Enhancing the change that, once received, the consumer will process the message in a
way that will support the overall objectives of the campaign
 Facilitating recall
 Creates a touchpoint that affects perceptions of the brand
Processing creativity: rational vs emotional
Different creative approaches
 Humour
 Sex and sexual representation
 Authority/expertise/information
 Shock/fear
 Nostalgia
 Teaser
 Words/pictures/sounds
Benefits and pitfalls of humour
 Low risk option
 Used effectively it can generate ‘ad-liking’
 Aids recall and positivity of recall]can be highly persuasive in low involvement
situations
o But in high involvement products, can have the opposite effect
 Humour is culturally grounded and what is considered humorous in one market
may not be considered at all amusing elsewhere
 Can be thought to trivialise an otherwise serious subject (i.e in social marketing?)

Benefits and pitfalls of the use of sex and sex representation

 Has been demonstrated to be effective in arresting consumer attention and generating
levels of recall
 Particularly effective for younger audiences for whom sex and sexual experience is
informative, novel and salient
 Can cause certain groups to have a negative disposition towards the brand,
particularly women
 Can seriously compromise the effectiveness of marketing communication, particularly
if the message is complex
 Can have a negative impact on the consumers’ psychological wellbeing:
o Idealised images of beauty can impact negatively on young girls’ self esteem
o Young men exposed to the sexual depiction of women in advertising are more
accepting of sexual aggression towards women and sex-role stereotyping
Fear and shock campaigns
Based upon shock and/or fear use the threat of negative consequences o motivate consumers
into action
 Most used in areas of public policy and social marketing
 Aims to increase levels of involvement and perceived risk
 The success of any fear and/or shock campaigns depends upon the target’s willingness
to interact with it
 Protective motivation theory suggests that if shock and fear appeals are either too
forceful or too subtle, they are likely to be ineffective
Authority/ expertise
Where the product or service is positioned as having a high degree skill or knowledge in a
specific market area
 Or where the brand is endorsed by someone or something that has expert
power/source credibility
 Reduces consumer perception of risk
 Especially effective in high involvement situations
Example: Oral B uses a person with white coat imitating a dentist to become more credible
Nostalgia
Where a creative execution references specific elements of the past that are meaningful and
potentially persuasive to the target market.
 Tendency to selectively remember that past means that consumers perceive products
associated with past times as more positive than those associated with the present day
 Age/longevity is often equated authenticity and quality which can result in iconic or
‘vintage’ status
 But care must be taken to ensure ‘resonance’ and avoid being perceived as old
fashioned, out-dated or ‘twee’
Teaser campaign
Campaigns that offer the consumer an incomplete message with the result that they then seek
to achieve some form of ‘closure’
 Gestalt psychology suggests that individuals are driven to ‘fill in the gaps’ when faces
with an incomplete situation
 Increases level of both product and message involvement
 Two types:
o Ongoing narrative
o Incomplete picture

Creative tactics: words, pictures and sounds

High imagery words, strong colours and attractive images and shapes all have the potential to
attract and hold the attention of the audience
 Jingles- classical conditioning (Pavlov 1927)
 Loud noises, disproportionate print size, strangely coloured pictures- expectation
disconfirmation theory
 Attractive images
Challenges and pitfalls
 Translating creative execution across media
 Layering creative over time
 Managing ethical balance
o Pushing the barriers whilst staying inside ASA guidelines
 Managing the balance between the functionality of the communication and the
creative execution
 Achieving consistency across agencies/depts
Week 8
BRANDING
A brand, term, symbol design or a combination of these, which is used to identify the goods
or services of one seller or group of sellers and to differentiate them from those of
competitors. (Koetler et al 2001)
A brand is a set of associations lined to a name, mark or symbol associated with a product or
service. The difference between a name and a brand is a name that doesn’t have associations;
it is simple a name. A name becomes a brand when people link it to other things. (Calkins
2005)
Powerful brands communicate their values through every point of contact they have with
consumers (white & de Chernatony, 2002)
What’s the difference between a ‘product and a brand’?
‘a product is something with a functional purpose. A brand offers something in addition to its
functional purpose. All brands are products... but not all products are brands’ (Jones 1986, p
29)
‘a brand is a distinguishing name and /or symbol (such as logo) intended to identify the goods
or services of either one seller or a group of sellers and to differentiate those goods or
services from those of competitors’. (Aaker 1991, p7)
What makes a strong brand?

The importance of a brand…

“If this business were split up, I would give you the land and bricks and mortar and I would
keep the brands and trademarks and I would fare better than you” Co founder Quaker Oats
Branda have monetary value..

Another example is Facebook, this company has a head office, technology, intellectual
property. But actually, what it physically earns is very little to the net asset value. The ratio is
nearly 6 times more.
Functions of a brand for the company
 Legal instrument
 Lego (distinctiveness)
 Competitive advantage
 Focus of loyalty
 Justifies premium pricing (brand equity)
Functions of a brand for the consumer
 Functional and/or emotional value
 Shorthand
 Risk reducer
 Added value
 Relationship
Anatomy of a brand

Tangible Components of a brand

 Name
 Logo/font
 Jingle
 Colour
 Brand characters/mnemonics
Intangible components of a brand: Dimension of brand personality Aaker (1997)

Brand image and Brand identity

Brand image is passive and looks to the past.
Brand identity should be active and look to the future.
(Aaker 1984 cited in Dahlen et al 2009)
Brand Relationship Typology (Fournier 1998)
 Arrange marriages- you buy them because your partner does
 Casual friendships- you buy them often but your particularly can leave without it.

Getting it right drives longevity.. when were these brands launched?

Brands can extend their lives through the use of extension strategies
 Line extension- use of an existing brand name for a new offering in the same product
category.
 Brand extension- use of an established brand name to enter a new product category

Async 8
BRAND ARCHITECTURE
Brand portfolios (Elliot and Percy 2007)
 Defines as the various brands marketed by a company within a particular product
category
 Recognises the difference in consumer needs, wants and taste.
 Recognises that consumers tend to select from a ‘choice set’ known as an ‘evoked set’
(Solomon et al 2013)
 Use economies of scale and shared expertise to capitalise upon multiple segments
 Spread risk
From a ‘House of Brands’ to a ‘branded House’ (Aaker and Joachmsthaler 2000)
 House of brands
o Individual brands that have no apparent connection with each other i.e. VW’s
brands.
 Endorsed Brands
o Brands are independent but endorsement gives it more credibility i.e Polo by
Ralph Laurent
 Subbrands
o Master brand primary frame of reference which are stretched by the subbrand
to add attributes/context i.e. Microsoft Office, Apple iPhone
 Branded House
o Large number of brands under a ‘master’ brand i.e. Virgin
Three levels of branding (Keller 2013)
 ‘Parent Brand’: Corporate brand, umbrella brand and family brand. Examples
include Virgin Group and Heinz.
 Endorsed brands, and sub-brands. Examples include Nestle KitKat, Cadbury Dairy
Milk, Sonny PlayStation and Polo by Ralph Lauren.
 Individual product brand. For example Procter & Gamble’s Pampers or Unilever’s
Dove.
Brand architecture
“An integrated process of brand building through establishing brand relationships among
branding options in the competitive environment.”
Describes how a ‘family of brands’ within a company’s portfolio are related to, and
differentiated from, one another.

The bastion brand is your brand leader within your portfolio, ideally within the life cycle will
be in the mature state since it has been already established.
Flanker brands which are similar brands which are positioned in a similar way in the portfolio
but consumers have the choice to buy them. Most likely if consumers don’t buy the bastion
brand they are more likely to consume the flanker brand.
 Also, we have the Fighter brands that they are the cheapest ones. If the consumer who
normally wants to buy a cheap brand and it’s normally promotionally given will consume this
one.
Finally, prestige brands are particularly valuable and aspirational. Buyers from a bastion and
flanker brands aspire to buy. You will never do a promotion in a prestige brand.
Boston Consulting Group (BCG) Growth-share Matrix (Koetler et al 2019)
 Visual representation of an organisation’s brand portfolio
 Mirrors the product life cycle
 Helps to identify areas of strength and weakness in a portfolio

Benefits of managing a brand portfolio (keller 2013)

 Increased chance of consumers will buy a brand from company’s portfolio
 Opportunity to exploit scale advantages
 Opportunity to exploit strategic advantages
 Allows a company to spread its risk
 Potential for synergy can improve overall organisational profitability
 Potential from brand/line extensions
 Improved trade leverage, ‘shelf space’, ‘share of mind’
Recent trends
 Important to be different
o Link with creativity
o Difference with a purpose
 Brands with a purpose beyond just making money gain brand equity
more quickly
 A clear proposition paired with an effective communications strategy is essential
o A reputation as an innovative brand drives brand value
 Over the past 10 years, brands that scored highest in the BranZ trend-
setting metric increased an average of 161% in brand value. Brands
that scored lowest increased only by 13%.
 Loved brands grow faster
o Consumer develop emotional affinity with brands
o Brands generally high performing/generate high levels of satisfaction
 Trust is essential in creating brand ‘love’
o Trust in the performance of the brand
o Trust in the organisation
key trends over the past 10 years
 Links with geographical areas impart specific values and support salience
 o ‘Country of origin’ effects
o Regional stereotypes
o Local/national loyalties
Poor brand management can damage even the most established brands…
SUMMARY
 Brand portfolios can take a range of forms- from a House of brands to a Branded
House
 They can spread risk and add value to an organization but they can also be costly to
manage and maintain
 Like products, brands also have a lifecycle so the portfolio needs to be managed
 However, if managed badly, it can prove costly not only to single brands, but all
brands under the same ‘umbrella’
Reading: Aaker, D.A. and Joachimsthaler, E., 2000. The brand relationship spectrum: The
key to the brand architecture challenge. California management review, 42(4), pp.8-23

Brand architecture is an organizing structure of the brand portfolio that specifies brand roles
and the nature of relationships between brands.

Subbrands and endorse brands can play a key role in creating a coherent and effective brand
architecture. In particular, they provide tools to:

 Allows brands to stretch across products and markets,

 Address conflicting brand strategy needs,
 Conserve brand building resources in part by leveraging existing brand equity,
 Protect brands from being diluted from over-stretching, and
 Signal that an offering is new and different

Without subbrands and endorsed brands the choice of a new offering would be limited
largely to either building a new brand ( an expensive and difficult proposition) or extending
an existing brand ( and therefore risking image dilution).

A branded House uses a single master brand to span a set of offerings that operate with
only descriptive subbrands. For example, Sonny, Nike. Etc

The house of brands, in contrast, involves and independent set of stand-alone brands, each
maximising the impact on a market. They sacrifice economies of scale that come with
leveraging a brand across multiple businesses.in addition, those brands that cannot support
investments themselves (3rd or 4th entry in a category) risk stagnation and decline.

The house of brands strategy, however, allows firms to clearly position brands on functional
benefits and to dominate niche segments.

Lecture 9

MARKETING SUSTAINABILITY

Marketing: satisfying a need… or taking advantage?

“although the modern marketing concept emphasises its mission to satisfy consumer needs
and wants, that promise, in reality, is sometimes lost or misplaced, resulting in outcomes
that are not in the best interests of either the consumers or society. Rotfeld (2001)

What do we mean by ‘ethics’?

Moral? Honest? Truthful? Good?

Ethics is the study of morality: those practices and acivities that are importantly right and
wrong (De George 1999)

Ethics are the moral principles and values that govern the actions and decisions of a
individual or group (Jobber 2007)

The growth of the ethical organisation…

Business Ethics: The moral principles and values that guide a firm’s behaviour .

Thirty years ago, businesses considered themselves ‘ethical’ if they complied with legal
standards and industry guidelines.

Increasingly companies are creating values-based programmes that are globally consistent
across their organisation.

Marketing ethics

Marketing ethics considers the application of ethics to the field of marketing and
communication. (De George 1999)

DUTIES VERSUS CONSEQUENCES

“Do not harm” … now or later?

Firms such as Bacardi, Mcdonalds, etc might be seem as inmoral brands. Bacardi used party
ads to encourage people to have fun, they suggest you need to drink Bacardi (alcohol) you’ll
have fun but this can lead to an dependant relationship with it.

Mcdonalds promotes cheap fast food which can have many consequences in health,
obesity,etc

Scope of ethics (de Geroge 1999)

Approaches to managing ethics

Reactive vs. proactive

Programmes put in place to diffuse criticism Strategic initiatives that respond to

environmental concerns
Ie. Nike, Gap and Levi’s attempt to diffuse
‘sweat shop’ allegations Pro-actively promote positive links and
positive brand values

I.e. Communication of Co-op’s ethical

investment programmes and B&Q’s
involvement with forest stewardship
programme
ONE RELATES TO THE LETTER OF THE LAW AND ONE RELATES TO THE SPIRIT OF THE LAW!

The challenge of sustainability in marketing (bridges and Wilhelm 2008)

 Often coined the ‘Three Es’ or The Triple Bottom Line (Savitz and Weber 2006)

o (Ecological) Environmental

o (Social) Equity

o (Financial) Economic

 How do you minimize environmental impact and support social equity without a
negative impact on finances?

The case of ‘fast fashion’ (Arrigo 2020)

 Fast fashion is “the retail strategy of adapting merchandise assortments to current

and emerging trends as quickly and effectively as possible” (Sull, D.; Turconi, S. 2008)
o Production usually takes place offshore using contracted suppliers
 Sourcing decisions have historically been based upon price and timing
 The sustainability challenge for organisations: to achieve a balance between social,
environmental, and economic goals to satisfy stakeholders’ requirements
 How do you reconcile this with a ‘market orientation’?

Sustainable marketing decisions

‘Sustainability’ in marketing is found under a number of labels ( Adapted from Wihelm
2007)

• Sustainable marketing

• Sustainability marketing

• Green marketing

• Corporate Social Responsibility

• Cause-related marketing

• Social marketing
The societal marketing concept

The societal marketing concept is a management orientation that holds that the key task of
the organisation is to determine the needs and wants of target markets and to adapt the
organisation to delivering the desired satisfactions more effectively and efficiently than its
competitors in a way that preserves or enhances the consumers’ and/or society’s well being.
Kotler (2002)

SUMMARY

 Ultimately, ethical and sustainable marketing actively seeks to ‘do no harm’ – now or
in the future.

 Returns on ethical and/or sustainable marketing can take longer than traditional
marketing approaches.

 Profit/benefits are often difficult to measure or attribute to a single campaign or

brand

 However, whilst organisations and brands have suffered major reputational damage
from being unethical, it is rare (if ever) to be castigated for being ethical.

Async 9
Murphy, P. E. (2017) 'Research in marketing ethics: Continuing and emerging
themes', Recherche et Applications en Marketing (English Edition), 32(3), pp. 84-89.

Marketing ethics

“Marketing ethics is the systematic study of how moral standards are applied to marketing
decisions, behaviors, and institutions” Laczniak and Murphy (1993).

This definition focuses on the notion that marketing ethics is applied to various decisions
such as product safety, pricing practices, high pressure selling, and a number of other areas.

In later work (Murphy et al., 2005, 2017), the focus has shifted to an emphasis on ethical,
rather than unethical, marketing: Ethical marketing refers to practices that emphasize
transparent, trustworthy, and responsible personal and/or organizational marketing policies
and actions that exhibit integrity as well as fairness to consumers and other stakeholders.

Consumers

Ethical consumption, where consumers use their purchasing power to select products that
are more socially and environmentally positive (Brunk, 2010; Lewis and Potter, 2011).

Products

From an ethical perspective, sin products (i.e. tobacco, alcohol, firearms, pornography, and
gam- bling/gaming), continue to receive ethical scrutiny with more graphic labels being
proposed for cigarettes by a number of countries. In fact, tobacco products are unique
because they are the only products that, when used as directed, will kill/harm you while the
others cause damage when misused.

Price

The basic ethical question that is asked about the pricing of any product: is it a fair price?
Irrespective of whether the price is high, moderate, or low, the key consideration concerns
the value of the product to the market as well as whether the price accurately represents
such value.

Channel/place

The growth of non-store/online retailing in recent years has brought on several new and
unanticipated ethical issues as it relates to the channel. Another issue is the supply chain for
manufacturers and retailers. Firms such as Apple, Nike, and fashion retailers like the Gap,
H&M, and Zara have been criticized for not doing a better job of policing the supply chain
practices of their contractors. Employee safety as well as wages and working condition
problems are often associated with the manufacture of a wide range of products.

Promotion

While advertising has long been associated with ethical problems, the 21st century has
brought some unique challenges to this area. The growth of online advertising is one of the
biggest developments in recent years.

 Online behavioural targeting (OBT), tracking a consumer’s online actions to create a

profile of the individual, is a practice that has advantages for both consumers and
marketers, but it also “has the technological potential to violate consumers’ privacy
rights to an unprecedented degree ... and is often non-transparent and deceptive”
(Nill and Aalberts, 2014: 126).

 “native advertising” – the practice of blurring the line between editorial and
advertising in the media. The ethical issue surfaces when consumers are unaware or
misled into thinking that they are reading a news story rather than a paid ad.

Suggestions for junior scholars in conducting research on marketing ethics

First, even for junior scholars, it is possible to publish important theoretical and conceptual
articles on marketing ethics. Second, theory testing is needed especially for the new, more
global theories of marketing ethics. Third, depth interviews of managers are one (but
certainly not the only) method to study marketing practitioners. Fourth, a thrust of current
ethics research, especially in Europe, appears to be on consumer ethics and responsible
consumption (Brinkmann, 2004; Brunk, 2010). Several of the caveats mentioned above
regarding avoiding student samples and narrow cross-cultural studies should be heeded
here as well. Finally, another fruitful area is to examine marketing ethics from the stand-
point of another foundational discipline.
Conclusion

With the growth of sophisticated technology in online tracking, big data collection, and
targeted advertising, the ethical issues associated with these practices will continue to
mushroom, making it a fruitful area of further research.

Kemper, J. A. and Ballantine, P. W. (2019) 'What do we mean by sustainability

marketing?', Journal of Marketing Management, 35(3/4), pp. 277-309. 

The relationship between marketing and sustainability seems to be non-contentious for

marketers. However, for those in macromarketing, critical marketing, and those outside the
marketing discipline, the issues of (un)sustainability in marketing raise critical questions
about what it means to be sustainable and how this can be achieved in marketing. Many
ignore the issue that overconsumption is still a problem and that replacing products with
green ones does not address the issue of limited resources. Indeed, Prothero et al. (2010)
discussed the ‘green commodity’ discourse which has taken hold, getting ‘people to think
about consuming less rather than just differently’ (p. 155)

The difference between green and ecological marketing is that the former conforms to
consumer pressure, while the latter is based on some sort of moral dimension (van Dam &
Apeldoorn, 1996). However, both these concepts overestimate the demand, willingness and
ability of the consumer to purchase environmentally friendly products (as they are usually
charged at a premium), and for the producer to create such goods .

Fuller (1999, p4) defines ‘Sustainable marketing’ as the process of planning, implementing
and controlling the development, pricing, promotion, and distribution of products in a
manner that satisfies the following three criteria:

1. customer needs are met

2. organisational goals are attained
3. the process is compatible with eco-systems.

‘sustainable marketing’ reconfigures the marketing mix and focuses on the transformational
potential of marketing on creating favourable institutional change for sustainable
consumption and production (Belz & Peattie, 2010)

Discourses of sustainability

Sustainability is defined ‘as development that meets the needs of the present without
compromising the ability of future generations to meet their own needs’ (Brundtland, 1987,
p. 43). It includes 3 dimensions:

1. economic (the ability for enterprises and activities to be sustained long term)
2. social (an equal distribution of benefits and a reduction in poverty)
3. environmental (conserving natural resources)

Neumayer (1999) introduced the concept of weak and strong sustainability in economic
theory.
  Weak sustainability is the substitutability paradigm wherein natural capital is
‘substitutable in the production or consumption of goods and as a direct provider of
utility’ (p.1); therefore, it does not matter if natural resources are not available for
future generations so long as other resources such as roads, ports and machinery
‘are built up in compensation’ (p.1).
 Strong sustainability is less clearly defined than weak sustainability, but there is a
general belief that natural capital should be preserved for future generations and
that natural capital is non-substitutable.

Sustainability marketing

Lim (2016) encapsulate sustainability marketing as including economic, environmental,

social, ethical and technological aspects to sustain- ability; however, this conceptualisation
continues to remain inadequate.

Auxiliary sustainability marketing

The Auxiliary Sustainability Marketing (ASM) perspective includes integrating sustainability

throughout the whole marketing mix, focusing on environmental, social and economic
dimensions of production and consumption.

Firstly, focusing on the product, sustainable properties can be divided into three attributes:
production conditions (how the product was made, e.g. child labour, harsh working
conditions, CO2 emissions of production, water use); product characteristics and
performance (what the product contains and what it does, e.g. CO2 emissions of use,
chemicals); and exposures and risks (exposing people to risks through product consumption,
e.g. non-toxic paint) (Iles, 2008). Sustainable products reuse materials and are recyclable.

Within this discourse, both the socioecological product life cycle and/or ecological product
life cycle can be taken into account. The socioecological product life cycle includes
examining who produces the product and the impact of production on humans and non-
humans, such as eliminating child labour. the ecological product life cycle takes into account
the environmental impact of the product during production and consumption, and in
disposal.

Distribution includes disposal of the product, thus issues such as the use of recyclable
materials (pollution prevention) and disposal/collection projects become part of the
marketer’s role; these ‘resource loops’, recovering and reusing materials is essential to the
sustainable product system. Also, Reducing carbon emissions is essential in ASM
distribution. Reducing transportation effects can include looking at the location of the
company itself, finding closer suppliers, etc.

Product price now incorporates environmental and social costs, and addresses and
communicates the total cost of the product. Mixed opinions exist about the charging of
price premiums for green products. Some believe that price premiums can be charged and
consumers are willing to pay, while other research demonstrates that (most) consumers are
unwilling to pay for environmental dimensions.
Promotion in ASM focuses on two key elements:

1. the materials used in promotion (how to promote) - advertising and other marketing
activities are conducted through sustainable means (e.g. the Internet, recyclable
paper)
2. the messages promoted (what is promoted)- promotions are focused on
communicating the firms and products sustainability initiatives

The aim of ASM is to provide a ‘green’ or ‘sustainable’ image for the firm to improve
company or brand reputation and customer loyalty. Eco-labelling or certifications may be
adopted to provide understandable and credible information to customers.

Traditionally, ASM segments and targets the market according to attitudes towards
sustainability but more recent studies segment the green consumer. ASM relies on
consumers sustainable attitudes; without these ‘green consumers’, businesses will not
implement sustainable marketing activities. In other words, it’s a demand-pull strategy for
green products (Chen, 2001).

Reformative sustainability marketing

Reformative Sustainability Marketing (RSM) extends the aspirations of ASM and acknowl-
edges that current consumption levels are unsustainable. For this reason, RSM is seen as
being responsible for promoting sustainable lifestyles and to demarket certain harmful or
undesirable products/services.

RSM assumes that the problem of unsustainable consumption lies in a lack of information
and knowledge by the consumer. RSM focusses on real needs, rather than ‘frivolous’ wants

Marketers must change their mindset and ask themselves, does this ‘satisfy a genuine
human need?’

Marketing is now seen to take into account the long term and thus, sustainability marketing
becomes embedded in organisational culture and values.

Lastly, there is a greater involvement with stakeholders, and a wider variety of stakeholders
are consulted (internal, such as employees and customers, and external, such as local
communities)

Transformative sustainability marketing

TSM values continuity over profit.

TSM views responsibility as lying with both firms and consumers. Indeed, sustainability
marketing cannot rely on sustainable production practices alone; it also needs positive
collective citizen action.

TSM acknowledges the weaknesses of the current economic system and challenges us to
question our preconceived notions of the ‘good’ of capitalism and neo- liberal economics
Overall, TSM seeks to provide a critical lens onto current marketing practices, consumption
ideology/culture and the institutions that inhibit a move to a sustainable society (Belz, 2005;
Gordon et al., 2011).

According to Belz (2006), TSM is a type of ‘mega marketing’ and attempts to change social
and political institutions to favour sustainable consumption. These institutions can be both
formal (laws, regulations) and informal (social norms). companies can change these formal
institutions through lobbying and a proactive stance on regulation and informal norms can
be changed through social marketing campaigns that address social norms; such campaigns
could denormalise undesirable behaviours and products, and normalise desirable
behaviours and products.

Theoretical implications

ASM, while benefiting from a ‘win-win’ scenario with competitive advantage and superior
social and ecological performance, delivers no ‘real change in marketing thinking or
substantive progress towards more sustainable consumption and production’ (Belz &
Peattie, 2010, p. 9). ASM will also need to take a consumption and production system
perspective, as the sustainability of a product is determined by how it is consumed as well
as how it is produced.

ASM still relies on the ‘green’ consumer to demand change (Wymer & Polonsky, 2015).
Consumers are seen as both the saviour and inhibitor of green products; unsustainable
products are still offered because this is what companies see consumers demanding but yet,
we also rely on ‘green’ consumers to demand sustainable products. what happens if there is
no, or not enough, sustainable consumers?

The RSM perspective acknowledges the limits to growth as there are limits to natural
resources and nature as a sink for waste (Kilbourne, 1998). This marketing perspective takes
responsibility for consumer and societal welfare, and helps guide consumers to better
choices. This may include finding ‘alternative ways of delivering want satisfaction without
consumers owning the assets’. RSM admits its role in current unsustainable consumption
patterns and seeks to change consumer behaviour towards sustainable consumption. Thus,
a key task for organisations is to reduce consumption and change consumer behaviour, as
well as attitudes and beliefs, towards a sustainable lifestyle.

In some ways, RSM may reflect Fisk’s (1998) recommendation that green marketing should
aim for the universal adoption of sustainable technologies (ASM) and discard the goal of
hyperconsumption.

The TSM perspective goes beyond. TSM acknowledges that it is only through an examination
of what keeps society and consumption unsustainable that we can understand the ways to
transition to a sustainable society. TSM takes an institutional theory perspective, suggesting
that organisational policies and practices reflect external pressures for legitimacy. It shifts
from micro to macro marketing.

Managerial implications
At its core, ASM implies that sustainability is built into the organisational culture, its mission
and decision-making. As a consequence, all organisational and marketing activities must
support sustainability (Polonsky & Rosenberger, 2001). As such, the best practice would be
for a total replacement of the (unsustainable) product line rather than just new product
extensions. However, the danger of ASM is that it becomes focused on a product
orientation. When implementing ASM, both consumption and production processes and
systems must be taken into account. Durability and the life of products must be a priority
and planned obsolesce a thing of the past

Minimising waste is the best strategy. organisations should adopt a closed-loop circular
system; this is based on the cradle-to-cradle approach (biological nutrients for living systems
which can be returned to the natural environment after use).

In addition, organisations must reflect on alternative avenues to address consumer needs

(RSM). New business models based on services (e.g. Charter et al., 2002; Murphy, 2005),
through renting, sharing and collaborative consumption are needed. These new business
models have the ability to address societal problems such as pollution and
hyperconsumption.

Belz (2005) suggests that TSM is a type of marketing that can be led by sustainability
pioneers and leaders. Pursuing TSM can then either change institutions to set positive
incentives for the development and use of sustainable products, or set negative incentives
for conventional products. TSM should go beyond corporate interests and have respect for
humanity, including non-humans, and the environment.

Public policy implications

governments need to both incentivise new sustainable production and technologies (i.e.
subsidies, research funding), as well as punish and regulate unsustainable production (e.g.
taxation). a regulatory framework that advocates for full-cost accounting is needed.

Revision exam

open exam 24h.

2h to answer 3 questions out of 5

Credit is given for the use of correct terminology and citation of sources in text (no
references at the end!). example: Using McCarthy's (1964) 'product' 4Ps Marketing Mix
model....

All questions are of equal value

You should write 1.5/2 sides for each question

Create a file with models in order to be quicker

Key topics
Look at the Mintel report for training shoes/ athletic wear (access it through wwk resources,
if not you have to pay)

Create revision ‘crib sheets’ for each topic

Go through the slides and key concepts and theories

Define and explain how they might apply / what relevance they have for Allbirds

Think about how different concepts and theories might relate to each other
Q1

 Definition of market orientation

 Explain different orientations (when you are asked about a wide concept of orientations,
include other types withing the concept)
 Advantages and disadvantages NOT BEING ASKED
 Give examples within Allbirds + acknowledge importance of market orientation
(saturatedd market, many competitors)
o Example: Allbirds conform to the needs of its consumers while still using ethically
sustainable materials. Their “Tree” shoe collection was developed after its buyers stated
how their original woollen sneakers were not the most suitable during hot weather. Hence
Allbirds created another line, now considering a new material that “has more cooling
properties'' (Eucalyptus). It complies to the customers’ needs because they now have
products that can be used throughout all seasons - while also maintaining its awareness
towards the environment. 
o how market orientation is done in an effective way
o How they have developed throughout years and what changes have been made
to fit customer needs
o refer to Levitt, 1960 - marketing myopia
o   Gap in the market
o   Feedback mechanism from customers?
o   Marketing myopia paper: customer need as a priority
o   Casual footwear vs activewear
-          Keep up with the needs of people who try to conduct a more environmentally
friendly life
-          Change desires of consumer through advertisements: garner the attention of the
customer/ better targeting/ you get to know them better and easier to target
-          Social media: customers get to have a say through polls/ comments/ likes/
interaction with them that then gains feedback
 alternative argument = 
- losing focus on customer needs = spending A LOT of energy on material
development/sustainability, when stated earlier that isn't customers priority
- potentially edging towards production orientated>market because of stress on scaling
up

Q2
  Define:
o extensive problem solving: completely new process that consumers never done
before = high risk. They buy something they never buy
o limited problem solving: decision consumers have to make when they buy the
product regularly = little consequence for the consumer 
o Routine Response behavior: decision)making for low risk products such as
everyday products = frequently purchase, familiar product

 Identify that buying shoes is a limited problem solving venture for consumers. 

 Discuss how they have a unique positioning (tie in perceptual maps) in the market
compared to big brands like Nike and Addidas, that they want to consumers to be do
extended problem solving more. i.e thinking about the sources for the materials that the
companies use and how the make the shoe.
 Discuss how they have developed the market positioning using the 4 Cs - give examples
for each one:
Consistency - they have been focused about sustainability with every part of their shoe -
talk about the development of the sole and packaging.
Clarity - Tying in their original marketing videos of how they advertised it with Tim Brown
walking though the sheep
Credibility - Talk about being registered as B-Corp
Competitiveness - Managing to get key influencers to where their shoes, like Larry Page
and Dick Costolo.

 Discuss how they need to identify their achetypes that will be their first users, people who
tackle these problems regularly (interested in sustainability) but that they need to
persuade other shoe lovers to think more extensively about their shoe purchasers 

Whenever the word decision making comes out = always link to the consumer decision
making process theory (structured model)

Q3

There is very little as prue product/ service. Allbirds offers both product and service.

1) What is a pure product? What is a pure service? (Definition&examples to start off) 

a.    Define what a service is (Dibb and Simkin, 2013)
b.    Use the Total Product Anatomy Model

2) Do you agree with the statement? Is there such a thing as a pure product or a pure service &
Why do you think so?
a.    Palmer’s goods-services continuum – where does Allbirds lie on it?
 
3) What is the Allbirds’ Product Offer? — which aspects
product&service? 
a.    A shoe is something tangible (product)
o  But there are also features of a service: In store experience, Customer service: advice from
staff, delivery of shoes to home:
 
4) Do you think Allbirds’ Product Offer is pure product/service? Or
elements of both? Reference Allbirds’ to statement .
a. Make a clear conclusion stating whether we think it is more a product or a service or if
it's both. Why?