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Elementary Marketing




Assessment Methods


Continuous Assessment       (40%):

Participation           5%

Assignment           15% (Tentative Mid Nov - Group Project)

Test                       20% (Tentative Early Nov) 


Final Examination                   (60%)


Lecture Outline





Chapters Required



Topic 1   Marketing in a Changing World


Chapter 1 – Managing Profitable Customer Relationship

Chapter 2 – Company and Marketing Strategy: Partnering to Build Customer Relationship


Topic 2   The Marketing Environment


Chapter 3 – Marketing Environment


Topic 3   Consumer & Organizational Buying Behavior


Chapter 5 – Customer and Business Buying Behavior


Topic 4   Market Segmentation,

Targeting and Positioning for Competitive



Chapter 6 – Segmentation,

Targeting and Positioning:

Building the Right

Relationship with the Right



Topic 5   Market Research & Information System


Chapter 4 – Managing Marketing Information


Topic 6   Product Concepts


Chapter 7 – Product, Services and Branding Strategy



Topic 7   Developing and Managing Products


Chapter 8 – New Product Development and Product Life Cycle Strategies


Test Week




Topic 8   Pricing Strategy


Chapter 9 – Pricing Considerations and Strategies


Topic 9   Distribution Strategy


Chapter 10 – Marketing Channels and Supply Chain Management

Chapter 11 – Retailing and Wholesaling


Topic 10  Integrated Marketing Communication Strategy


Chapter 12 – IMC: Advertising, Sales Promotion and Public Relations

Chapter 13 – IMC: Personal Selling and Direct Marketing


Topic 11  Promotional Mix


-- Ditto ---


Topic 12  Marketing Management Process


Chapter 14 – Marketing in the Digital Age


Topic 13  Global Marketing


Chapter 15 – The Global Marketplace








Philip Kotler & Gary Armstrong, Marketing: An Introduction, Pearson, Prentice-Hall, 7th Edition, International Edition.


Useful Link: Google Toolbar (文字翻譯器: 將英文網頁翻譯成繁體中文)









Chapter (5-8)

Websites (Examples for Marketing Concepts)

 5 – Consumer and Business Buyer Behavior

Consumer Market and Consumer Buyer Behaviour


A Marketing Battle over Brain

Consumer Buying Behavior from Marketing Teachers


(1) Model of Consumer Behavior


(1) What to buy - Product/ Services

(2) Where to buy - Place  

(3) How to buy - Decision Making Processes

(4) When to buy - Time 

(5) Why they buy - Reasons behind the Behaviour


Marketing Stimuli

4 Ps (Product, Price, Place and Promotion


Other Stimuli

Macroeconomic forces (Refer to the Foces in Chapter 3 - Marketing Environment


Stimuli have effects on the buyer’s black box – turned into a set of observable buyer response 


For Example,

(A) product choice - Soft Drink 

(B) brand choice - Vitasoy 

(C) dealer choice - 7-Eleven 

(D) purchase timing - After physical exercise 

(E) and purchase amount - 1 Bottle only


                                 Cultural Factors

    • Culture - Moon Cake (Hong Kong Chinese), Individualism (American Culture)
    • Sub-culture - Telephone Card for Long Distance Call (Pilipino in Hong Kong), Local website with English, Complicated and Simplified Version, Fad for Korean Culture, Hakka Chinese.  
    • Social Class- Occupation (e.g. doctor, accountant and blue-collar worker) , Income, Education (University Credit Card for local graduates) , Wealth (e.g. millionaire) and Other Variables

                                 Social Factors

         (1) Aspiration Group (Soccer Star) 

         (2) Membership Group (Singer's Fan Club); (3)

         Reference Group (Soccer Star - Aspirational Group) ->

         Opinion Leaders/Early Adopters (Hi-Tech Product - Digital Camera).


Family – Husband (e.g. Private Car), Wife (e.g. Home Decoration) and Children (e.g. Toy)

    • Roles and Status - Family, Clubs (e.g. Mountaineering Club) and
    • Organizations (e.g. Professional Bodies - Lawyers and Accoutants)


  • Personal Factors

o        Age & Life Cycle Stage - Family Life Cycles

    • Occupation - Professional, Blue-Collar (e.g.  Cheap Work Clothes) and White Collar (e.g. Business Suit)
    • Economic Situation - Income Saving and Spending Power (e.g. Income-sensitive Goods or not)
    • Lifestyle - AIO Dimensions (A = activities --> work, hobbies, shopping, sports, social issues, business, products,,, I = Interests --> food, fashion, family, recreation,,, O= Opinion --> social issues or personality)
    • Personality and Self-Concept -> leads to consistent responses to marketing stimuli


  • Psychological Factors


    • Motivation (Drive) - Ideals, Achievement and Self-expression (by motivation research to probe hidden and subconscious motivations)
    • Perception – the process by which people select, organize and interpret information to form a meaningful picture of the world
    • Learning – describes the change in an individual’s behavior arising from experience
    • Beliefs and Attitudes – Through do and learning, people form beliefs and attitudes

 (2) Buyer Decision Process

(A discussion on the Search for Lunch Venue after this Lecture) 

    1. Need Recognition (might jump direct to Step 3)
    2. Information Search – personal sources, commercial sources, public sources and experiential sources
    3. Evaluation of Alternatives
    4. Purchase Decision – affected by purchase intention, attitude of others and unexpected situational factors

New Product Adoption Process

Consumer Adoption Process for New Product


Business Markets and Business


Buyer  Behaviors


Business Markets


Characteristics of Business Markets


Market Structure and Demand


Nature of Buying Unit


Types of Decisions and The Decision Process


Business Buyer Behavior


Major Types of Buying Situations


Participants in the Business Buying Process


Major Influences on Business Buyers


The Business Buying Process


Business Buying on the Internet


6 – Segmentation, Targeting and Positioning

(A) Segmentation


P&G Hong Kong


Lam SoonEdible Oil and Detergent

Unilever China

Vitasoy (Product Range)

Golden Resources - Rice HK 

Lee Kum Kee Sauce

Nescafe China


(Segmentation, Targeting and Positioning)


Segmenting – (From Marketing Teacher)


(1) Segmentation Variables for Individuals

 Identify the Bases for Segmenting the Market

  1. Geographic Segmentation – Book (Asian Edition)
  2. Demographic Segmentation
  3. Psychographic Segmentation
  4. Behavioral Segmentation
  5. Benefit Segmentation
  6. Using Multiple Segmentation Bases

(2) Segmenting Business Markets




Benefit Sought

User Status

Usage Rate

Loyalty Status

Operating Characteristics

Purchasing Approaches

Situational Factors

Personal Characteristics


(3) Segmenting International Markets


Geographical Locations

Economic Factors

Political and Legal factors


(B) Target Marketing

Evaluating Market Segments

1.          Segment Size and Growth

2.          Segment Structural Attractiveness – by Five Forces Analysis – Michael Porter

3.          Company Objectives and Resources – Conglomerates Vs SMEs in Hong Kong


Selecting Target Segments


Targeting (from Marketing Teacher)


1.          Undifferentiated Marketing (Mass Marketing) - Coke

2.          Differentiated Marketing (Segmented Marketing) G2000 Ladies and Men and Crocodile Men, Ladies and Kids

3.          Concentrated Marketing (Niche Marketing)Haagan Daz Premium Ice Cream or specialty shop – teddy bear shop

4.          Micromarketing

A.        Local Marketing – Localized Promotional Leaflets by Wellcome and Manning

B.        Individual Marketing  (One-to-One Marketing) - e.g. Or  or  Wedding Services or Tailor


Choosing a Target Marketing Strategy

      u Company Resources

      u Product Variability

      u Product Life Cycle Stage


Socially Responsible Target Marketing


e.g. Alcohol, Cigarettes and Magazines/Movies for Adult


Positioning for Competitive Advantage,  Positioning Maps and Choosing a Positioning Strategy


“The place the product occupies in consumers’ minds relative to competing products”


Positioning – From Marketing Teachers


Volvo Car (HK) - Positioning Strategy


Identifying Possible Competitive Advantage


Differentiation on Product, Service, Channels, People and Image


Choosing the Right Competitive Advantages


How Many Differences to Promote?


Which Differences to Promote?




Selecting an Overall Positioning Strategy


Value Proposition


A.        More for More

B.        More for the Same

C.        Same for Less

D.        Less for Much Less

E.         More for Less


Developing a Positioning Statement


Communicating and Delivering the Chosen Position


7. Product, Services and Branding Strategy

What is a Product?


Product (e.g. Fast Moving Consumer Product)

P&G and Unilever (pure-tangible good)



Prudential Insurance Ltd (pure-services)

Movies – U&A Cinema


Good-and-Service Combinations

Dell Computer (with Warranty, Installation and Delivery) 


Good and Services Provide Experiences to Customers


Product and Service Classifications

Discussion over the Dell /IBM Computer/ Sony for the Levels of Product and Services


Core Benefit – What is the buyer really buying for Computer? (Problem-Solving)

Actual Benefit – Brand Name, Features, Design, Packaging and Quality Level

Augmented Product – Delivery and Credit, Installation, Warranty and After-Sales Service


Product and Service Classifications


Consumer Products

u        Convenience Product – Goods at Supermarket (e.g. Wellcome and Park’N Shop

u        Shopping Product – furniture (e.g. IKEA) and clothing (e.g. G2000 / Esprit)

u        Specialty Product – e.g. stamp shop

u        Unsought Product – Innovative Products (e.g. IT and Digital Products – HK Golden/ e-zone / HK PC Market Magazine)


Industrial Product

u        Materials and Parts – Intel (e.g. CPU for Computer)

u        Capital items – for printing – Heidelberg Printing Machine), - for photocopying – Xerox Printing Machine

u        Supplies– operating services (e.g. Lubricants, coal, paper and pencils)

u        Business Services – maintenance, repair service and business advisory services


Organizations, Persons, Places and Ideas – Other Marketing Offerings

Activities undertaken to create, maintain or change the attitudes and behavior of target customers towards



(e.g. Corporate Image Advertising – IBM On-Demand business solutions)



Particular people (e.g. Lawyers and Accountants)



Particular Place (e.g. Hong Kong – Live it! Love it!)



Particular Ideas (e.g. Social Marketing – environmental campaign – Friends of Earth HK)





Individual Product and Service Decisions


Product and Service Attributes


Product Quality – TQM (Total Quality Management) (Q Mark)


Product Features – (e.g. Digital Camera – Canon or Mobile

Phone – Samsung)


Product Style and Design (e.g. Apple I Mac or iPod+iTunes)




Sunkist Orange

Dole pineapple

Chiquita banana



Colgate toothpaste



HK labeling Law – Contents and Ingredients (e.g. Energy Efficiency Labelling Scheme for Air-conditioners)


Product Line Decisions and Product Mix Decisions


An Overview over Some of Consumer Products

u        Electronic Appliances (e.g. Panasonic, Sharp and Sony)

u        FMCG (P&G , Unilever, J&J, Lam Soon, Vitasoy and Lee Kum Kee Sauce Oil, Nissin Noodle)


Points to consider about the Product Line


u        Product Line – a group of product that they are closely related

u        Product Line Length – the number of items in the product line


n          Product line stretching – e.g. downwards or upwards by class level – Private Car (e.g. Toyota)

n          Product Line Filling – e.g. Adding more items with the present range of the line (e.g. shampoo series of P&G HK)


Points to consider about the Product Mix


u        Product Mix (or Product Assortment) – consists of all the product lines and items that a particular seller offers for sale (e.g. Avon’s Product Mix – beauty products, wellness products, jewelry and accessories, gifts and “inspirational” products (inspiring gifts, books, music and home accents)


u        Product Mix Dimensions –


n          Width – the number of different product lines the company carries

n          Length – the total number of items that company carries within its products

n          Depth – refers to the number of versions offered for each product in the line

n          Consistency – refers to how closely related the various product lines are in end use



Branding Strategy: Building Strong Brands


Brand Equity

Definition - The positive differential effect that knowing the brand name has on customer response to the product and service.


A measure of brand equity is the extent to which customers are willing to pay more for the brand.


Strong Brand = Valuable Assets (e.g. Coca Cola, IBM, General Electric, Intel, Microsoft, Nokia, Disney, McDonald’s and Mercedes)


Building Strong Brands

Brand Positioning – in the minds of customers

u        By product attributes (e.g. P&G Head and Shoulders - dandruff-free hair.)

u        By benefits {e.g. Volvo (Safety), Hallmark (caring), FedEx (Guaranteed Overnight Delivery) and Nike (Performance)}

u        Beliefs and Values – (e.g. Starbuck – refreshing and relaxing)


Brand Name Selection

u        Related to benefits and qualities (e.g. 快潔 cleaning products)

u        Easy to pronounce, recognize and remember(e.g. 有骨氣 Chinese Restaurant)

u        Distinctive (e.g Toy”R” us)

u        Extendable (e.g. Yahoo! Finance and Shopping)

u        Translated to other languages

u        Capable of registration and legal protection (e.g. Lenovo Against Legend)


Brand Sponsorship

u        Manufacturer’s Brand (e.g. IBM)

u        Store Brand and Distributor’s Brand (e.g No Frills or First Choice)

u        Licensed Brand

u        Co-Brand


Brand Development

u        Line Extension (e.g. Nissin Noodle in different favours)

u        Brand Extension (e.g Knife Peanut Oil , Corn Oil and Sunflower Seed Oil)

u        Multi-brands (e.g. P&G Shampoo Series)

u        New Brands


Managing Brands

u        Brand Experience by Brand Managers for better Customers’ Positioning towards the Brands – contact and touch points


Service Marketing


Nature and Characteristics of a Service






Marketing Strategies for Service Firms


The Service-Profit Chain

u        Internal Service Quality

u        Satisfied and Productive Service Employees

u        Greater Service Value

u        Satisfied and loyal Customers

u        Healthy Service Profits and Growth


Internal Marketing Vs Interactive Marketing

  Refers to the Textbook


Managing Service Differentiation

e.g. Airway Business (e.g Cathay Pacific Airways, Singapore Airlines and Dragon air)

e.g. Delivery Service (e.g. HK Post Office Vs FedEx)


Managing Service Quality


Managing Service Productivity


Additional Product Considerations


Product Decisions and Social Responsibility


International Product and Services Marketing


8. New Product Development & Product Life Cycle Strategies


New Product Development Strategy


By R&D Development


Vanilla Coke/Diet Coke (Coca Cola)
Instant Camera (Polaroid) versus Digital Camera (Canon)
AXE Detergents for Fruits (Lam Soon)




Hotmail & MSN by Microsoft!


   Idea Generation

Internal Sources –
From Employees (e.g.
3M Idea Program)

External Sources –
From Customers, Competitors, Distributors and Suppliers and Others


    Idea Screening

To spot good ideas and drop poor ones As Soon As Possible.


    Concept Development and Testing


Product Idea – an idea for a possible product that the company can see itself offered to the market.


Product Concept – is a detailed version of the idea stated in the meaningful consumer terms


Product Image – the way consumer perceive an actual or potential product.


Concept development & Concept Testing

(e.g. Car – Electric Car – Gemcar under DaimlerChrysler - Concept Test)


    Marketing Strategy Development


Marketing Strategy Statement


u        Describe the target market, plan the product positioning and the sales, market share and profit goals for the first few years


u        Outlines the product’s planned price, distribution and marketing budget for the first year


u        Describes the planned long-run sales, profit goals and marketing mix strategy.


    Business Analysis


A review of the sales, costs and profit projections for a new product to find out whether these factors satisfy the company’s objectives.


      Product Development


R&D Department – develops the product concept into a physical product in order to ensure that the product idea can be turned into a workable product

(e.g. Nike Sport Shoes , Gillette’s Shavers and P&G Consumer Products)


Importance of Product Portfolio – Boston Matrix (Source: Marketing Teacher)


       Test Marketing


e.g. Breakfast Meal at KFC Restaurant (HK)

(Testing the product and the entire marketing program – positioning strategy, advertising, distribution, pricing, branding and packaging and budget levels)




Introduction of a new product into the market


       Organization for New Product Development


u        Sequential Product Development

u        Simultaneous (or Team-based) Product Development


Product Life Cycle Strategies


Style, Fashion and Fad (Refer to the Textbook p.280)


PLC: (Source: Marketing Teacher) –

    • Introduction Stage – the stage in which the new product is first distributed and made available for purchase

1.                  To build up awareness

2.                  To attract distributors and customers

    • Growth Stage – the stage in which a product’s sales start climbing quickly.

1.                  Enhance the Marketing Mix

2.                  trade-off between high market share and high current profit

    • Maturity Stage – the stage in which sales growth slows or levels off

1.                  Modifying the market

2.                  Modifying the product

3.                  Modifying the marketing mix

    • Decline Stage – the stage in which a product’s sales decline.

1.                  To maintain

2.                  To harvest

3.                  To drop