Part 1：Customer Focus and Marketing Management 1
1 THE CONCEPT OF MARKETING 1
The Marketing Concept 6
ILLUSTRATION：AT＆T 7
Different Organizational Philosophies 7
What Is Customer Orientation？ 9
An Alternative Perspective 11
The Changing Nature of Marketing 14
The Increased Adoption of Information Technology 14
The Rapid Commercialization of the Internet 16
The Continued Globalization of Business 19
The Value of the Customer Base 21
The Focus of This Book 22
Executive Summary 23
Chapter Questions 23
Further Reading 24
2 THE MARKETING MANAGER’S JOB 25
The Job of the Marketing Manager 27
ILLUSTRATION：Motorola 32
The Marketing Plan 32
ILLUSTRATION：Cadillac 35
The Lessons 38
Introduction to the Integrated Case 40
Executive Summary 44
Chapter Questions 44
Further Reading 44
Part 2：The Development of a Marketing Strategy 45
3 A STRATEGIC MARKETING FRAMEWORK 45
Complete Marketing Strategy 46
Objectives 48
Strategic Alternatives，Customer Targets，and Competitor Targets 49
Product Features 51
The Core Strategy：Competitive Advantage 52
Product Positioning 62
ILLUSTRATION：Metaxa 64
The Value Proposition 64
Marketing Strategies over the Product Life Cycle 65
Strategies for the Introductory Phase 66
Growth Strategies 67
Strategies for Maturity 68
Strategies for Decline 69
Product Line Strategy 69
Executive Summary 72
Chapter Questions 72
Integrated Case Application Exercises：Developing Marketing Strategy in the Personal Computer Industry 73
Further Reading 73
4 MARKETING RESEARCH 75
The Research Process 79
Secondary Data Sources 81
Internal 81
External 82
Primary Data Sources 87
Informal 87
Qualitative Research 88
Observations 91
Surveys 91
Panels 93
Experiments 94
Models and Simulations 96
Market Potential and Sales Forecasting 96
Market Potential 96
Forecasting 98
A Tip 103
Executive Summary 103
Chapter Questions 104
Integrated Case Application Exercises：Marketing Research in the Personal Computer Industry 104
Further Reading 105
5 CONSUMER BEHAVIOR AND ANALYSIS 107
Who Are the Consumers？ 109
Segmentation Variables 111
Marketing Research Implications：Data Collection 119
Marketing Research Implications：Developing Target Markets 122
ILLUSTRATION：Harley Davidson 123
Why Do Consumers Buy？ 127
How Do Consumers Make Purchase Decisions？ 131
Search for Alternatives 131
What Happens Next？ 132
Evaluating Options in the Consideration Set 132
Postpurchase Behavior 135
Where Do Customers Buy？ 136
When Do Customers Buy？ 137
ILLUSTRATION：Mango 137
Executive Summary 139
Chapter Questions 139
Integrated Case Application Exercises：Consumer Behavior in the PC Industry 139
Further Reading 140
6 ORGANIZATIONAL BUYING BEHAVIOR 141
Industrial Versus Consumer Marketing 143
Derived Demand 143
Product Complexity 144
Buyer-Seller Interdependence 144
Buying Process Complexity 144
Who Are the Customers？ 145
Segmentation Variables 145
Marketing Research Implications：Data Collection 149
Marketing Research Implications：Developing Target Markets 150
ILLUSTRATION：Signode Industries 150
Why Do Customers Buy？ 153
How Do Customers Make Purchase Decisions？ 155
The Buying Center 156
The Buying Process 158
External and Internal Influences on Purchasing Behavior 161
Where Do Customers Buy？ 161
When Do Customers Buy？ 161
Executive Summary 163
Chapter Questions 163
Integrated Case Application Exercises：Customer Behavior for the PC Industry 164
Further Reading 164
7 MARKET STRUCTURE AND COMPETITOR ANALYSIS 165
Market Structure Analysis 167
Definitions 167
Measurement Issues 172
Competitor Analysis 176
Key Objectives 177
Competitor Strategies 178
Competitor Strengths and Weaknesses 182
Expected Future Strategies 185
Where Do We Get the Information？ 186
Secondary Sources 187
Primary Sources 188
Competitive Strategy：Some Game Theory Notions 188
Executive Summary 191
Chapter Questions 192
Integrated Case Application Exercises：Market Structure and Competitor Analysis in the PC Industry 192
Further Reading 192
Part 3：Marketing Mix Decision-Making 193
8 COMMUNICATIONS AND ADVERTISING STRATEGY 193
Communications 196
Integrated Marketing Communications 200
Advertising 200
Direct Marketing 201
Sales Promotion 202
Publicity and Public Relations 202
Personal Selling 202
Miscellaneous Communications Activities 203
ILLUSTRATION：Amdahl Corporation 203
ILLUSTRATION：M＆M Mars 204
Advertising Management 205
Selecting the Target Audience 207
Setting Advertising Goals 207
Developing the Message Strategy 209
Evaluating Message Copy 213
Selecting Media 216
Budgeting 221
Measuring Advertising Effects 227
Executive Summary 230
Chapter Questions 230
Integrated Case Application Exercises：Communication in the PC Industry 231
Further Reading 231
9 CHANNELS OF DISTRIBUTION 233
The Importance of Channels of Distribution 234
Channel Dynamics 239
Channel Functions 241
Marketing Research 241
Communications 241
Contact 241
Matching/ Customizing 241
Negotiation 241
Physical Distribution 241
Financing 242
Risk-Taking 242
Service 242
Relationship Management 242
Product Assembly 242
Framework for Choosing Among Channels 242
Factors Affecting the Channel System 243
Customer Behavior 243
Competitors 244
The Marketing Strategy 246
Resources 246
Channel Options 247
Direct and Indirect Channels 247
Multiple-Channel Systems 248
ILLUSTRATION：Ingersoll-Rand 249
Hybrid Systems 250
ILLUSTRATION：Digital Equipment Company 251
Channel Power and Management 252
Channel Power 252
Channel Management 253
Some Special Topics in Channels of Distribution 256
Using the Web 256
Some Supermarket Issues 258
Multilevel Marketing 259
Direct Marketing 260
ILLUSTRATION：Mercedes-Benz 261
ILLUSTRATION：ON Technology 262
Executive SummaRY 263
Chapter Questions 263
Integrated Case Application Exercises：Distribution Channels in the PC Industry 264
FuRTher Reading 264
10 PERSONAL SELLING 265
The Sales Force and the Marketing Organization 268
Types of Sales Organizations 268
National/Key Accounts Organizations 270
ILLUSTRATION：Marriott Lodging 271
What Does a Salesperson Do？ 272
Directing the Sales Force 273
Determinants of Performance 273
Designing Sales Territories 276
Determining the Size of the Sales Force 277
Designing Sales Territories 276
ILLUSTRATION：Syntex Corporation 280
Setting Sales Quotas 282
Sales Volume-Based 282
Financially Based Quotas 282
Activity-Based Quotas 282
Combinations 282
Compensation 283
Straight Salary 283
Straight Commission 284
Combination Plans 284
Controlling and Evaluating the Sales Force 285
The Changing Nature of the Sales Force 286
The Impact of Technology 286
ILLUSTRATION：Lanier Worldwide 289
The Salesperson’s Job 290
Executive Summary 291
Chapter Questions 291
Integrated Case Application Exercises：Sales Management in the PC Industry 291
Further Reading 292
11 PRICING 293
The Role of Marketing Strategy in Pricing 294
Perceived Value 297
Customer Value 297
A Framework 301
Price Elasticity 301
Calculating Customer Value 301
ILLUSTRATION：Hewlett-Packard 304
ILLUSTRATION：Rocket Science Inc 305
ILLUSTRATION：Rolling Rock Beer 305
Using the Perceived Value Concept 306
Competition and Pricing 307
Competitors’ Costs 307
The Role of Costs 308
Deciding How Much of the Strategic Pricing Gap to Capture 309
Pricing Objectives 310
Psychological Aspects of Price 311
Stage of the Product Life Cycle 313
Industry Conditions 315
Who Is the Decision Maker？ 315
Specific Pricing Tactics 316
Product Line Pricing 316
Value Pricing 317
Differential Pricing 318
Competing Against Private Labels 319
Pricing and the Internet 320
Executive Summary 323
Chapter Questions 324
Integrated Case Application Exercises：Pricing in the PC Market 324
Further Reading 325
12 SALES PROMOTION 327
Types of Sales Promotion 332
Consumer Promotions 333
ILLUSTRATION：Beiersdorf 340
Trade Promotions 341
Retailer Promotions 342
Promotion Strategy，Objectives，and Evaluation 342
Customer-Oriented Promotions 342
Trade Promotion 345
ILLUSTRATION：Proctor ＆ Gamble 348
Retail Promotion 348
Promotion Budgeting 349
Advertising and Promotion Budget 349
Allocating Money Between Advertising and Promotion 349
Sales Promotion and Information Technology 352
In-Store Information Technology 352
Using the Internet 352
Executive Summary 353
Chapter Questions 355
Integrated Case Application Exercises：Sales Promotion in the PC Industry 355
Further Reading 356
Part 4：Special Topics in Marketing Management 357
13 CUSTOMER RELATIONSHIP MANAGEMENT 357
The Economics of Loyalty 359
Acquisition Cost 361
Base Profit 361
Revenue Growth 361
Operating Costs 362
Referrals 362
Price Premium 362
The Total Effect 362
Approaches to Customer Retention 364
Customer Satisfaction 364
Customer Value Management 367
Customer Service 370
Loyalty Programs 374
OtherIdeas 377
Mass Customization 378
Marketing Information Systems 382
ILLUSTRATION：Harrah’s Entertainment 382
ILLUSTRATION：UPS 382
Executive Summary 384
Chapter Questions 385
Integrated Case Application Exercises：Relationship Management in the PC Industry 385
Further Reading 386
14 STRATEGIES FOR SERVICE MARKETS 387
The Nature of Services 390
A Classification of Goods 390
Characteristics of Services 391
Service Quality 391
The Service Quality Model 391
The Dimensions of Service Quality 392
Gaps in Perceptions of Quality 393
Measuring Service Quality 395
The Return on Quality 396
Strategic Issues 397
The Problem of Intangibility 397
The Problem of Low Barriers to Entry 398
Service Design 401
ILLUSTRATION：Singapore Airlines 403
Marketing Mix Implications of Service Marketing 405
Channels of Distribution 405
Advertising 406
Pricing 408
The Impact of Technology on Service Marketing 409
ILLUSTRATION：Financial Services 409
Executive Summary 411
Chapter Questions 411
Integrated Case Application Exercises：Service Marketing in the PC Industry 412
Further Reading 412
15 STRATEGIES FOR TECHNOLOGY-BASED MARKETS 413
Customer Behavior 416
Factors Affecting the Adoption Rate of New Technologies 416
ILLUSTRATION：Fax Machines 419
Perceived Risk 419
The Problem of High-Tech Versus High-Touch 420
The Diffusion of Innovations 420
Marketing Strategies for High-Tech Products 422
The Chasm Model 422
ILLUSTRATION：Baan Co 426
ILLUSTRATION：Netscape 426
Switching Costs and Lock-In 426
Market Segmentation Issues 427
Positioning 428
ILLUSTRATION：DNA Plant Technology Corporation 429
Positioning Through Branding 430
Handling Overlapping Technologies 432
Marketing Mix Issues 433
Channels of Distribution 433
ILLUSTRATION：OEMs 436
ILLUSTRATION：VARs 436
Other Marketing Mix Variables 437
Executive Summary 437
Chapter Questions 438
Integrated Case Application Exercises：High-Tech Marketing and the PC Industry 439
Further Reading 439
16 GLOBAL MARKETING STRATEGIES 441
The Global Marketing Debate 446
ILLUSTRATION：Orangina 448
ILLUSTRATION：Tambrands 448
Strategic Issues 449
Market Entry Strategies 449
Modes of Operation 455
ILLUSTRATION：Fuji Xerox 456
Consumer Behavior：The Importance of Cultural Differences 458
Product Positioning 460
ILLUSTRATION：Saatchi ＆ Saatchi 460
Global Branding 462
ILLUSTRATION：Lucky-Goldstar 463
Defending Local Markets 463
ILLUSTRATION：India 464
Marketing Mix Implications 465
Channels of Distribution 465
ILLUSTRATION：Proctor ＆ Gamble 467
Pricing 468
Advertising and Promotion 470
The Impact of the Internet 471
Executive Summary 472
Chapter Questions 473
Integrated Case Application Exercises：Global Marketing and the PC Industry 473
Further Reading 474
17 NEW PRODUCT DEVELOPMENT 475
Factors Affecting New Product Success or Failure 479
Approaches to New Product Development 481
The Classic Linear Approach 481
The Rugby Approach 483
The Target Costing Approach 485
ILLUSTRATION：Nissan 485
Steps in the New Product Development Process 487
New Product Concept Generation 487
Screening New Product Concepts 489
Product Definition 490
Forecasting Demand 494
ILLUSTRATION：Nestle 499
Topics in New Product Development 501
The Importance of Shorter Product Development Cycles 501
Improving the Integration of Marketing and R＆D 503
Executive Summary 504
Chapter Questions 505
Integrated Case Application Exercises：New Product Development and the PC Industry 505
Further Reading 505
Notes 507
Glossary 525
Index 535