Chapter 1 Chapter 2 Chapter 3 Chapter 4 2 types of data: Primary and Secondary Examples of Touch Points: Websites, point of sale,

store displays, advertising, sales promos, contact with sales person. 3 Basic Research Plans: exploratory research, descriptive, and casual Observational Research: The gathering of primary data by observing relevant people, actions and situations can obtain info that people are unwilling or unable to provide. Cannot be used to observe feelings, attitudes, and motives and long-term or infrequent behaviors. Customer Touch Points: Any interaction or encounter where we have the opportunity to influence the consumer. Implementing Research Plan: 1. Collecting Data - Most expensive, subject to error 2. Processing the data - Check for accuracy, code for analysis 3. Analyzing Data - tabulate results, compute statistical measures - CRM analysts use data mining techniques to: find out information about consumers - Customer Relationship Management (CRM): widely implemented strategy for managing relationships with customers through the use of databases and other technology. - Secondary Data: has already been collected for another purpose and already available - Non-probability samples: selected in a non-random manner, which means sampling error can be computed. Selected because of convenience, less expensive and time consuming. - Primary Data Collection: Designing a primary data collection plan involves making decisions related to the research approach, contact methods, sampling plan, and research instruments. - Benefits of CRM: offer better customer service, develop deeper customer relations, pinpoint and target high value customers more effectively, develop offers tailored to customers. - Exploratory Research: gathering preliminary info that will define the problem and suggest hypothesis.

- Traditional Market Research: systematic design, collection analysis, and reporting of data relevant to a specific marketing situation facing an organization. Chapter 5 (RED) works with the worlds best brands to make unique (PRODUCT) RED-branded products and directs up to 50 percent of its gross profits to the Global Fund to invest in African AIDS programs with a focus on the health of women and children. Research conducted by (RED) found that teens were very open to cause marketing, and that his group looked up to to celebrities more than any other segment. VP of marketing, Julie Cordua, is attempting to determine the optimal method of generating more money for the Global Fund. o Option 1: Expand the (RED) model based by creating smaller, special edition brands designed to appeal to the teen market, and using celebrities that appeal to teens. o Option 2: Stick with the existing (RED) model and continue to partner only with large international brands that make significant marketing and contribution commitments. o Option 3: Expand the (RED) model to include more traditional non-profit aspects such as donation and volunteering. Such a strategy would appeal to all consumer groups and increase engagement. Consumer behavior: the buying behavior of individuals and households who buy goods and services for personal consumption. As the goal of marketing is to influence consumer behavior, understanding the internal, situational and social factors which influence behavior is also important, as each of these factors represent opportunities for customizing the marketing mix in a way that will most appeal to consumers. Consumer decision-making varies in the amount of the time and effort expended A continuum anchored by habitual decision-making on one end, and extended problem-solving on the other end, with limited problem solving sitting in the middle. The amount of effort devoted by consumers to buying decisions varies according to the level of involvement how important the decision is perceived to be by consumers. Perceived Risk: potential that the product will have negative consequences o Physical: products pose a physical risk to users, children, or pets o Social: use of a product could lead to personal humiliation or public embarrassment o Psychological: when the wrong decision causes anxiety or concern o Financial: when the purchase could lead to a loss of wealth o Functional: whether or not the product performs o Time: the purchase will be a waste of time and effort Understanding the type of decision making that guides the majority of the target markets choice is important, as it suggests differing tactics that marketers should use to appeal to consumers.

So when a consumer recognizes a problem, such as the need to lose weight, he or she will be much more receptive to marketing communications that reflect a products ability to help, as the ad for V8 shows here. As a result, many marketers are now using more specialized search marketing techniques. Including Search Engine Optimization (SEO) and Search Engine Marketing (SEM). Behavioral targeting: is a technique that customizes the ads shown on the Internet based on the users surfing and browsing habits. o 1. Satisfaction = Expectations + Experience o 2. If the benefits and experience delivered exceed expectations, customers are satisfied, but when advertising overpromises what the product can do, or consumers form unrealistic expectations through other means, dissatisfaction will occur. o 3. Cognitive dissonance is common following a major purchase, even in instances where consumers are satisfied with their purchase. Cognitive dissonance refers to the anxiety or regret that a consumer may feel after choosing from among several similar attractive choices. Essentially, consumers become nervous and second guess the choice they made. Marketers can take a number of actions that may help to reduce cognitive dissonance: Include information inside the package praising consumers and reinforcing they made the right choice Using follow-up emails, letters, and phone calls to contact the buyer following the purchase as a means of either reassuring them or answering questions they might have. Offering comprehensive warranties and guarantees Marketers also try to understand the influence of each of the factors shown here, and how they impact the decision making process. These include factors internal to the consumer, situational influences, and social influences. True subliminal advertising embeds images or words into an ad that cannot be perceived consciously in an attempt to motivate consumers to action by appealing to their ID Once we activate a need, a state of tension exists that drives the consumer to some goal that will reduce this tension and eliminate the need The basic premise behind the hierarchy of needs is that consumers will seek to satisfy lower level needs (e.g., physiological) before progressing to higher level needs. When marketers understand the level of need most relevant to their consumer target, they can tailor their product and messages to match. Behaviorally based theories assume that learning takes place as a result of connections we form between events. In classical conditioning, a person perceives two stimuli at about the same time. After a while, the person transfers his response from one stimulus to the other. In operant conditioning, people learn that their actions result in rewards or punishments. Cognitive learning theory views people as problem-solvers who do more than passively react to associations between stimuli. Cognitive learning takes place when consumers make a connection between ideas or by observing things in their environment.

Observational learning occurs when people watch the actions of others and note what happens to them as a result. A persons attitude is composed of three components: Affect (feeling component): The overall emotional response that a person has to a product. The affective component of attitude is usually dominant for the types of product that make us happy perfume, jewelry, certain types of food, entertainment, etc. Cognition (knowing component): The beliefs or knowledge that a person has related to the product and its key features and benefits. Marketers often appeal to the cognitive component of attitude by providing factual information, especially for complex products or for those in which consumers are highly involved in the decision making process. Behavior (doing component): this component of attitude relates to an individuals intention to do something, such as to try or buy the product. A car ad which invites viewers to take a test drive is attempting to stimulate this component of attitude. . Understanding personality can help marketers create brands that appeal to specific personality types. Innovativeness: likes to try new things Self-Confidence: positive evaluation of his/her abilities Sociability: enjoys social interaction Materialism: emphasis placed on owning products Need for Cognition: likes to think about things Self-concept refers to the attitude that an individual has toward himself. A persons self-concept can influence the products he or she purchases. For example, this German ad appeals directly to the self-concepts of potential customers who want to lose weight. Self-esteem refers to how positive a persons self-concept is, and marketers often attempt to show consumers how the purchase of certain products (clothing, jewelry, deodorant) or services (massage, hair styling) can make them feel better about themselves, thereby enhancing their self-esteem. Lifestyles determine how people choose to spend their time, money, and energy. Psychographics allows marketers to target products more effectively and to better communicate with targeted segments by reflecting the unique interests, activities, and lifestyles of the targeted group in marketing communications. Situational factors help to share our purchase choices. Within the physical environment, store dcor, smells, lighting, music and temperature can influence consumption, which explains why sensory marketing is such big business. Sensory marketing occurs when a direct sensory experience, such as a unique fragrance, is linked with a particular product or service. Time is one consumers most limited resources and this sense of time poverty makes consumers more likely to respond to marketing services and products that offer to save time (1 hour film processing, music downloads over the web vs. ordering a CD for delivery, etc.). Impact of shopping on Christmas Eve

Casinos try to negate the time poverty influence by eliminating clocks on the gaming floor. You wont find windows or clocks on the walls of the gaming floor at the Luxor or any other casino Different cultures form different ideas of what particular colors symbolize. The color white is associated with death and mourning in China and some other nationalities, whereas Americans associate the color white with weddings, purity, and cleanliness. Rituals also vary by culture, be they weddings, funerals, or holiday celebrations. Thanksgiving is a unique American holiday typically celebrated with Turkey, dressing, cranberry sauce, and pumpkin pie. Understanding key rituals within a culture is important because these represent opportunities to demonstrate how a brand fits within the culture. Examples of subcultures include people who share the same ethnic background or the same religion. An even more specific form subculture are those who identify with a specific activity or art form. These groups of individuals are referred to as microcultures. A great example of a microculture are the HOGS members of the Harley Davidson Owners Group. Other examples of microcultures include macophiles (those who are intensely devoted to and interested in the Macintosh computer brand), brand groupies, snowboarders, and many others. Social movements within U.S. society may impact the way marketers do business. Consumerism refers to current attempts to protect consumers from harmful business practices. For example, public outcry in response to the use of the cool cartoon figure, Joe Camel, reached the ears of legislators, who studied the issue and concluded that Joe Camel was appealing to children and teens. As cigarette marketing to minors is against the law, special provisions governing where and how tobacco marketing could be done were included as part of the Tobacco Settlement agreement. Kyoto protocol: reduces greenhouse gas emissions that could change our climate. Environmental stewardship: businesses making socially responsible business decisions that protect the environment. Green marketing: efforts by marketers to choose packages, product designs, and other aspects of the marketing mix that are earth friendly, but still profitable Social class: The overall rank or social standing of groups of people within a society, according to factors such as family background, education, occupation, and income Status symbols such as luxury products allow people to flaunt their social classes Mass-class consumers are targeted by many marketers Types of Reference Groups: Membership: group that the person actually belongs to Aspirational: group that the person wishes to belong to Opinion leaders have nothing to gain by either endorsing or slamming a given brand trust that their opinions to be unbiased A true opinion leader is an expert in only one or two product categories at the most. No single person can provide informed opinions on every single product category.

Chapter 6 Business-to-business (organizational) markets include manufacturers, wholesalers, retailers, and other organizations such as hospitals, and government. Organizations purchase goods and services for one of three reasons: for use in operating the business (chairs, desks, copy machines, paper, toner, pens, etc.); to include as a part or ingredient in something else (raw materials such as grain, component parts such as tires, or memory boards); or for resale (wholesalers/retailers purchase goods to resell to ultimate consumers). Business-to-business demand differs from consumer product demand Demand is: o Derived o Inelastic o Fluctuating o Joint Inelastic: this means that it usually doesnt matter whether the price of a B2B good goes up or demand goes down businesses will still buy in the same quantity. However, B2B demand can become elastic if the cost of a price increase is passed on to consumers. Fluctuating : Demand for business goods is also subject to greater fluctuation than is consumer demand. Why? First of all, even a modest change in consumer demand can create large increases or decreases in business demand, as businesses postpone or cancel orders in response to declines in consumer demand. Secondly, business customers tend to buy certain products infrequently, such as major equipment used in manufacturing facilities which may be replaced only once every 10 to 15 years. Thus demand may be high one year, if it just so happens that a lot of firms buy replacement equipment at that time, but low the following year if fewer firms are in the market for replacement goods. Joint: Many business goods are characterized by joint demand, meaning that demand is linked between two or more goods, parts, or components that are used together to create a product. Can you give me an example? {computers: motherboards, hard drives, etc.} Trade associations recognize the importance of joint demand, and often try to stimulate it by suggesting new uses for their products. In the case of the ad shown on this slide, Mexican avocado producers are trying to promote greater consumption of guacamole, which in turn may stimulate demand for dipping chips, or even tequila. Three major classes of B2B customers include producers, resellers, and organizations. Producers are individuals or firms that purchase products for use in the production of other goods and services. The goods purchased may be raw materials, component parts, semifinished goods, or services. Examples: A) Dell buys RAM chips from Intel for integration into their PCs;

B) General Mills buys grains to be used in the manufacture of cereals from ; C) A travel incentive provider purchases hotel rooms, tickets to entertainment venues, and flights, then creates incentive packages that are sold to business corporations looking to reward employees who performed well. Resellers are individuals or firms that buy finished goods for reselling, renting, or leasing. Resellers include wholesalers, distributors, and of course retailers. Examples: A) Wholesalers/distributors: Sysco supplies hospitals, educational institutions, and other organizations with a variety of paper goods (napkins, toilet paper, etc.), ingredients (salt, sugar, etc.) and other items. B) Students should be able to come up with a variety of retailer examples quite easily. The Organizational market includes all levels of government and not-for-profit institutions. Federal, state, county, and local governments that buy goods and services to carry out public objectives and to support their operations. Organizations with charitable, educational, community, and other public service goals that buy goods and services to support their functions and to attract and serve their members. Examples: A) The federal government purchases military weapons systems, furniture for offices, copy machines, supplies, and services such as construction. State and local governments purchase many of the same items (with the exception of the cruise missile and other major military weapons). B) Not-for-profits purchase printing services to create educational brochures, supplies and products for distribution to charity recipients, and items to be used at their place of business. B2B E-Commerce refers to Internet exchanges between two or more businesses. These exchanges may take the form of information exchanges, product or service exchanges, and payment exchange. It links businesses with their suppliers, factories, distributors, and their customers Of course these web sites are also instrumental in providing B2B technical support, item/order status information, and customer service Intranets are generally more secure, as only authorized users can gain access. Because intranets are internal, transactions are more consistent and conducted under enhanced security than is typically found on Internet based web sites. Extranets allow certain suppliers or customers to access the firms intranet. This is often beneficial as it allows customers to place and track their own orders, enhancing their satisfaction This self-serve feature also means that extranets are very cost-efficient, as any actions taken by customers are suppliers saves time, effort, and cost on the part of the extranet provider. A final benefit of extranets is that they facilitate project collaboration, and help build relationships up and down the value chain. Private exchanges are more appropriate for businesses that want to collaborate or share information with some suppliers or customers, but NOT others.

The large amount of data which passes through the Internet also creates the potential for security risks. Hackers are continually finding new ways to access a variety of data 2. You may be surprised to learn that well-meaning employees can also be security threats when they are careless with passwords or otherwise engage in some type of behavior that assists (unintentionally) unauthorized users in gaining access. 3. Firewalls : a combination of hardware and software, that helps to prevent non-authorized users from gaining access to things they shouldnt Encryption devices: scramble messages so that only another party with the proper encryption key can unscramble it The use of social media in the B2B marketplace is growing. Games are being used by some B2B marketers to appeal to their customers. 2. However, the five most popular resources that people turn to find information relevant to their daily jobs includes: o Podcasts and webinars o Online ratings and review of business products and services o Company pages on social networking sites such as Facebook and LinkedIn o Company blogs o Social media searches for business information 3. The advantages of Linked In are substantial, and include . . . o Linked in allows you to see who your connections are connected to these may be people with whom you want to network o Unlike Facebook, Linked in is business oriented, and made up of primarily white collar workers. o Linked in has a function that facilitates professional introductions. o Linked can help alumni and colleagues reconnect, due to its extensive search engine. o Linked in users are professionals, and follow good business manners. Buying Center: the decision making unit of a buying organization o Not fixed or formally identified unit o Membership will vary for different products o Members can fill multiple roles o May include any member of the organization The primary roles that these individuals may play are shown in the slide: o Initiator: recognizes the problem and begins the buying process o Users: individual(s) who actually need and use the product o Gatekeeper: controls the flow of information to other buying center members o Influencer: this persons expertise and advice may influence the decision, though they may never use the product o Decider: individual who makes the final buying decision o Buyer: person who is responsible for executing the purchase Step 1: Problem Recognition: Business Buying Decision Process o Depending upon the type of buying class, recognition of the problem stems from: o Low inventory levels (straight rebuy)

o A need to replace outdated equipment (modified rebuy) o Changes in technology (modified rebuy or new task buy) o Marketing communications (modified rebuy or new task buy) Actions resulting from problem recognition include: o Initiation of a purchase requisition or request, in the case of a straight rebuy o Formation of a buying center, when a new task buy or modified rebuy is underway Step 2: Information Search: Business Buying Decision Process o In this second stage, buying center members begin their task by searching for information about products and suppliers. o Product specifications: are written descriptions of the quality, size, weight, color of the item to be purchased o Identifying potential suppliers and obtaining proposals or bids is also an important part of this step. o The Internet has facilitated both distribution of the request for proposals, and provided vendors with easier access to potential customers who might benefit from their services. B2B marketers make information available to buying centers in a number of ways. Ads such as the one shown here may be displayed in trade magazines specific to certain industries. While the companys web site is one of its strongest marketing tools, investments in search engine optimization and search engine marketing are often helpful in driving traffic to the web site. Direct marketing efforts via mail or email are also helpful. Some of the most beneficial marketing efforts are those that involve face-to-face interaction, such as trade show appearances, and sales visits. Step 3: Evaluate the Alternatives: Business Buying Decision Process o Price is always a major consideration when assessing proposals, as discount policies, returned-goods policies, cost of repair, terms of maintenance, cost of financing, and more are evaluated carefully by buyers o Non-price factors, such as service extras or differences may also be evaluated. o Product demonstrations, and presentations by sales representatives are critical when selling the marketers products to firms Step 4: Select the Product and Supplier: Business Buying Decision Process o The selection stage involves deciding which product and how many suppliers should be used. o Single sourcing: Sometimes having one supplier is more beneficial to the firm, such as when frequent deliveries are needed or when specialized products are desired. Buy relying upon a single buyer, the firm becomes a large customer to the supplier, and often this means that the firm can negotiate more favorable prices. Administrative costs may also be lower. Finally, single sourcing helps to assure the consistency and quality of products. The downside is that the firm is at the mercy of that supplier failure to meet delivery dates could stop the production line.

Multiple sourcing: Buying from several different suppliers protects the firm from inventory or delivery problems if one supplier has problems, the firm simply shifts business to one or more of the other suppliers. Furthermore, multiple suppliers keep each other honest in terms of pricing. o Reciprocity: On occasion, a buyer and seller will agree to be each others customers this is termed reciprocity. While not illegal per se unless they limit free competition, the U.S. Government does frown upon this, and often determines that agreements between large firms and their suppliers are illegal. o Crowdsourcing: Crowdsourcing is used when a marketer wishes to tap expertise to solve business problems that the firms own employees cant handle. o Reverse marketing: a final unique B2B sourcing situation occurs when businesses engage in reverse marketing. Firms try to find suppliers who would do a good job producing the needed product, then the firm tries to convince the supplier to manufacture the needed item. 5: Evaluate Postpurchase: Business Buying Decision Process Step o Organizational buyers assess the performance of the product and the supplier in one ways. o One method is to survey users to determine satisfaction with products, installation, delivery, service, and other aspects of the purchase. o Its also not uncommon for producers of consumer goods (which are sold through retailers) to research the satisfaction of the ultimate consumers who use the product, since the demand of retailers is derived from consumers demand o If changes in demand occur, they are analyzed, and supplier performance is also documented o Organizational buyers use a number of metrics when assessing how well a product or service performs. o (Purchasing agent/buying center member) satisfaction o Quality, and whether the product is meeting, exceeding, or falling short of expectations o Customer engagement: learning how customers got involved in the business, and finding ways to keep them involved is important o Purchase intentions: Purchase intentions often feed into demand forecasts, which in turn are used to set sales goals o The promptness and effectiveness of problem resolution is often a key factor that determines whether a firm sticks with vendor, or whether they search for new suppliers.

Chapter 7 The marketing concept dictates that firms should make every effort to understand and satisfy customer needs. Unfortunately, understanding needs is an increasingly complex task because of market fragmentation.

As a result of market fragmentation, mass marketing efforts are not as effective as they were twenty years ago, or even ten years ago. For the vast majority of brands, targeting everyone is not an option. EX. The specific needs and wants shared by older consumers who are looking for cell phones and cell service. The ad to the right of the slide targets this group, and demonstrates how the advertised brand satisfies the following needs: 1) ease of phone use (large buttons, bright screen, emergency alert feature); 2) simple calling plan (no contract required, simple rate plans). Market fragmentation, and the reduced effectiveness of mass marketing efforts in turn underscores the importance of developing a true target marketing strategy. The target marketing strategy process consists of three separate yet interrelated steps: Marketers first divide the market into segments based on needs and other customer characteristics The marketer then selects one or more segments to serve, For each segment chosen, the marketer develops products specifically to meet the needs of the selected group, and customizes all other aspects of the marketing mix in a manner which most effectively and efficiently sells the product to the segment. Segmentation : describes the process of dividing a larger market into smaller pieces based on one or more meaningful shared characteristics. Segmentation variables : dimensions that divide the total market into fairly homogeneous groups, each with different needs and preferences. Segmentation variables can be broadly classified as demographic, psychographic, or behavioral in nature, as shown in Figure 7.2. Generation X: is skeptical of marketing claims and maintain a cynical outlook towards marketing. Over time, Gen X has changed in many ways, as have marketers views of them. 2. Baby Boomers: a very large generation with buying power. They are in their prime earning years. 3. Older Consumers: Currently there are more than 40 million Americans ages 65 or older, and this group will only get larger as the baby boomers continue to age. They are more active and have more disposable income than in the past Family Life Cycle: Family needs change dramatically for many products over time, creating the opportunity to segment by family life cycle. Furniture is product category that varies with the family life cycle. Income: The more discretionary money available, the more likely it is that certain types of products and services will be consumed. {Ask students to NAME some products that are targeted to higher-income classes downshopping, meaning that higher income consumers are more likely to shop at stores like K-Mart and Walmart. Note that some businesses such as the dollar stores actively target individuals at the lower end of the income spectrum. Social Class: Consumers are more likely to buy according to the image they wish to portray rather than where they actually fall within the social class framework.

A consumers ethnicity often plays a strong role in preferences for products, services, and media. African-Americans comprise about 12% of the U.S. population. Asian Americans are the fastest growing minority in the U.S. Hispanic Americans are the largest minority group. Cultural diversity is the management practice that actively seeks to include people of different genders, races, ethnic groups, and religions as employees, customers, suppliers, or other members of the value chain. Members of psychographic segments typically share activities, interests, and opinions, often abbreviated as AOI. Some manufacturers choose a single, critically important activity, interest, or opinion as the basis for defining a niche market. For example, the ad on this slides illustrates how Toyota targets consumers who prioritize environmental issues with their Prius hybrid vehicle. As of 2011, most marketers would still consider the hybrid category to be a niche market. Sometimes firms contract with research firms to develop customized psychographic segmentations systems for their industry. As a result of the research commissioned by BMW, the luxury car market was segmented into groups As a final example, the recent economic recession has led to the identification of four distinct segments stemming from a bad economy: steadfast frugalists, involuntary penny pinchers, pragmatic spenders, and apathetic materialists. Steadfast frugalists are the least brand loyal and also the most likely to discount marketing messages, making them the most challenging group to target. Involuntary penny-pincher segment has also been severely impacted by the recession, and behave in a thrifty fashion similar to the steadfast frugalists. However, they dont like doing so. Pragmatic spenders have high spending power, making them an attractive segment to target in tough times Apathetic materialists appear to be relatively unaffected by the recession. Users and Non-Users: Why they do or dont use our product Heavy, Medium, and Light users: 80/20 rule The 80/20 rule suggests the 20% of the purchasers account for 80% of the volume. 4. Firms can make money by selling small amounts of items that only a few people want, provided that they sell enough different items. Example: Amazon.com Usage occasions: when they use our product the most Special promotions and labels for holidays Valentines Day Special products for special occasions Organizational demographics: the size of the firm (in sales or number of employees); number of facilities, whether they are a domestic or international firm, among others. Additional characteristics could include the type of production technology used by the firm Behavioral characteristics such as whether a given business firm is user or nonuser of the selling firms product.

Targeting is characterized by three phases in which marketers evaluate the attractiveness of each potential segment, profile each segment, and decide in which of these groups they will invest resources in order to turn them into customers. The customer group(s) selected are referred to as the target market. A viable target segment should: o Have members with similar product needs/wants who are different from members of other segments o Be measurable in size and purchasing power o Be large enough to be profitable o Be reachable by marketing communications o Have needs the marketer can adequately serve 1. Undifferentiated targeting strategy: assumes that people have similar needs. o Efficient due to economies of scale o Example: Walmart. 2. Differentiated targeting strategy: develops one or more products (and marketing strategies) for each of several customer groups. o Used when customers are choosing among well known brands and it is possible to identify one or more segments with distinct needs for different types of products o Example: LOreal 3. Concentrated targeting strategy. One or more products may be promoted to a single segment. o Useful for smaller firms that do not have the resources to serve all markets o Example: Hard Candy Customized marketing strategy: o Tailoring specific products to individual customers Mass customization: o Modifying a basic good or service to meet the needs of an individual Positioning: o Developing a marketing strategy to influence how a particular market segment perceives a good/service in comparison to the competition Brands are often described in terms of personality traits as if they were people. o Sincerity: down-to-earth, honest, wholesome, and cheerful are strongly associated with this personality dimension. {Good examples: Disney, Mrs. Butterworth, Jif Peanut Butter} o Excitement: daring, spirited, imaginative, and up-to-date. {Good examples: Apple, Mountain Dew} o Competence: Reliable, intelligent, and successful brands score high on the competence dimension. {Good examples: Maytag, Allstate, Toyota} o Sophistication: upper-class and charming. {Good examples: Rolex, Cartier, Grey Poupon mustard} o Ruggedness: Tough and outdoorsy. {Good examples: Timberland, Samsonite, Ford Trucks}

Perceptual maps are often used to visually describe where products/brands are located in consumers minds relative to competing brands. The perceptual map can sometimes help marketers understand where to position a new brand. Customer relationship management: o A systematic tracking of consumers preferences and behaviors over time in order to tailor the value proposition as closely as possible to each individuals unique wants and needs CRM facilitates one-to-one marketing, a process which is composed of four interrelated steps: o Step 1: Identify customers and get to know them in as much detail as possible. o Step 2: Differentiate customers by their needs and value to the company. o Step 3: Interact with customers; find ways to improve cost efficiency and the effectiveness of the interaction. o Step 4: Customize some aspect of the products you offer each customer. CRM systems use computers, software, databases, and the Internet to capture information at each touchpoint. Touchpoints are any direct interface between customers and a company (online, by phone, in person, etc.) Share of customer: the percentage of an individual customers purchase of a product (e.g., fast food) that belongs to a particular brand (e.g., Taco Bell). Lifetime value of the customer: the potential profit a single customers purchase of a firms products generates over the customers lifetime. Estimating LVC requires that the firm first estimate future sales across all products for the next 20 or 30 years, and then that the firm attempt to figure out what profit the company could make from this customer in the future. Customer equity: the financial (net) value of a customer throughout the lifetime of the relationship. Customer Prioritization: focus on high-value customers. The 80 /20 rule . . .in a CRM world, 80% of the profits often come from 20% of the customers. Think about brands that you used at your parents house that you still use today. Will you continue using them in the future? Ex.: how many boxes of cereal do you think you will eat in your lifetime?