Marketing Concepts and Strategies B01.2310, Sections 21, 22, 23

Prof. Eric Greenleaf

Spring 2002

Syllabus

Read this syllabus carefully. It is your guide to the course, and contains information that will help learn more and perform better. It describes the course's objectives, how it is conducted, your responsibilities, and a synopsis of each session. There are also study questions for each case. A copy of this syllabus will also be posted on the course web. All handouts, assignments, and transparencies will also be posted as they become available.

COURSE OBJECTIVES.

This course introduces you to the concepts and skills you need to create and critique effective marketing strategy. Simply put -

Effective marketing strategy enables firms to satisfy consumer needs and create consumer value, while achieving the firm's objectives by recovering some of the value it creates.

Usually the firm's ultimate objective is profit, which it earns by charging consumers a price that recovers some of the consumer value it creates. The firm can't recover all of this value, since otherwise the consumer has no surplus and will not be a customer. Without customers who believe that a firm satisfies their needs better than competitors, a firm has no value - it will go out of business and the rest of business strategy is pointless. Of course, some firms can have "profit" objectives that are not monetary, such as the not-for-profit and government organizations that represent a large chunk of most economies. (For simplicity this syllabus refers to a firm's offering as a "product," but this can refer to a tangible product, a service, or even a behavior change - think of an institution dedicated to reducing drunk driving or increasing literacy.)

Marketing strategy covers several kinds of activities, each of which affects the others. Firms must resist the temptation to focus on one of these at the expense of the others, since this can create an ineffective, unbalanced marketing strategy. Instead, firms need to create a balanced, coordinated marketing mix, where all elements of its marketing strategy work together to create a strategy that is more powerful than the sum of its parts.

The course is divided into seven sections that cover each of the most important activities in Marketing. It also begins with Introduction to give you an overall view of Marketing decision making before we examine each activity in detail. This course is designed for majors in all functional areas of business, since managers in all areas need a solid understanding of marketing strategy to succeed. While marketing managers create and implement marketing strategy, managers in finance, management, accounting, and production must understand marketing plans that affect their own operations, and their careers. Sometimes they must critique and approve marketing plans even if others will carry out those plans. For example, it is impossible to value a firm and its stocks and bonds, to plan its financial needs, or to establish its credit rating, without understanding its revenues from customers. These revenues are a direct consequence of its marketing strategy. Entrepreneurial ventures and "start-ups" also cannot succeed unless the owners have an excellent marketing strategy. Venture capitalists evaluating a potential investment almost always ask whether the start-up has a detailed, realistic, and persuasive marketing plan. Investment banks and consulting and accounting firms tend to promote to partner only people who can attract and retain new business, which requires using marketing to understand consumer needs and satisfying them in a manner that benefits the firm. The major factor that determined which internet firms survived and which did not is that successful firms had successful marketing strategies that satisfied consumer needs while also allowing the firm to make a profit.

Marketing strategy, and this marketing core course, differ in an important way from other business functions, and other core courses at Stern. While most core courses focus primarily on quantitative analysis, or on qualitative analysis, marketing strategy involves both. Qualitative analysis is important because marketing is, in the end, concerned with the behavior of people - consumers, competitors, partners such as salespeople and distributors - and this can never be completely described in quantitative terms. Furthermore, effective marketing strategy must make sophisticated tradeoffs between many factors to keep the marketing mix in balance, and most of these tradeoffs cannot be completely "quantified." Effective qualitative analysis requires careful reasoning, and writing that justifies your reasoning. Quantitative analysis is still, however, a proven way to obtain further insights into many marketing problems, compare alternative solutions, and get an advantage in complex decision making. It is invaluable for estimating the impact of many marketing decisions on customers and firm profits.

This dual nature of marketing makes it much more complicated than, for example, many financial markets or instruments, and involves many more sources of uncertainty and judgement. Many people feel uncomfortable with this aspect of marketing, and it is important for you to become comfortable with it. You will need to balance both kinds of analysis when you justify the marketing decisions you will make in class discussion and assignments.

The course uses a combination of lectures, class discussion, case studies, assignments, and exams, as follows:

1. CLASS PARTICIPATION

You will learn the most from this class if you and your classmates participate fully. You all have different experiences and insights, and a great deal of what you learn in class is from each other. You make no contribution with silence.

Your class participation earns 10% of your grade. Class participation means contributing to class discussion in a way that benefits your classmates. You don't have to speak very frequently or in every class to earn the highest possible class participation grade. How your comments help the class to understand an aspect of marketing strategy, or a possible strategy in a case discussion, matters more than how often you speak. I am aware that some of you may be shy about speaking out and respect this while at the same time encouraging you to participate. But you should expect to add to the class discussion on several occasions during the semester.

Class participation is not graded by any "curve" - it is possible and desirable for everyone in the class to earn a high grade for class participation. Class discussion should encourage the free and open exchange of ideas. If you want to challenge what I, or another student, have said, do so. Constructive criticism is always welcome and is an important part of the Stern MBA experience. Do not be dismayed if I challenge something you say - we learn most when we have to defend our positions. In fact, sometimes it is my responsibility as professor to play a devil's advocate who questions what you say in order to stimulate discussion, regardless of my own opinion. If you ever feel that my comments or the comments of any student are not constructive, please let me know.

Sometimes we will have to stop discussion and move on to the next topic before hearing from everyone - there is only so much time in each session. Please don't take it personally if there isn't time to call on you. Often we will try to hear first from class members who have not participated much before hearing from others who have spoken more often.

It is important for your classmates, and me, to know who you are. Marketing is not one of the block core courses, so many of you don't know each other. Please help out by using your desk name card during every class session in the semester. This helps your classmates, and me, learn and remember your name. This is especially important in large sections.

If you are not in class, you can't learn the material in the course nor contribute to the benefit of your classmates. I realize that occasionally you may be absent. Whenever you know in advance that you will be absent, please let me know in advance. If you miss class, be sure to obtain copies of notes from at least two of your classmates to insure that you do not miss any important material.

2. TEXTBOOK

The textbook and course case packet are available at the New York University Professional Bookstore at 530 LaGuardia Place. The text for the course is Marketing Management by Russell S. Winer. Often the assigned reading for a day includes material only from particular pages in one chapter, and in a particular order - I have done this intentionally to create reading assignments that are most relevant to the topic in each session.

The assigned readings from the textbook set the foundation for that day's class. Since your classmates and I will conduct class by assuming you have completed these readings, it is important that you do so and arrive in class prepared to contribute. Much of the class discussion will build on, rather than repeat, this material.

3. CASES

These marketing cases describe marketing problems encountered by real firms. We use them to apply marketing concepts and strategies to interesting, actual examples. They also give you an opportunity to make and justify marketing decisions. There is no "right" answer to a case, but there are many weak answers that are the result of inadequate analysis. We are usually not concerned with what happened to a firm after a case ends, but rather what we can learn by identifying the problems in the case, and using concepts from the course to create effective marketing strategies that address them.

The amount you learn from a case depends on how carefully you read and analyze it. You are expected to read each case thoroughly and come to class ready to contribute to case discussions. This syllabus contains a set of issues and study questions for each case which help focus your effort. Please read these carefully before reading a case. However, these questions will not always cover every important issue, or every issue we will discuss. Many of these questions require quantitative analysis to answer them well. In class we will try to compare the different kinds of analysis you have chosen.

Please note that in many cases some of the material is, by design, not particularly relevant to the problem at hand, while the case omits other things you would like to know and would certainly try to find out using market research if you were the decision maker. This can be a pain, but it does reflect the real world of decision making. Some of our discussion may revolve around what "missing information" we would like to have.

Some of these cases describe fairly recent events, while others are older. We discuss these older cases because they are "classics" that do a great job illustrating marketing concepts and problems that are as important to firms today as when the cases were written. They still create a forum for challenging and interesting analysis that is very relevant to today's marketing problems. This is why I have kept some of these older cases even after reviewing dozens of newer cases - sometimes the older case is just better.

Many of these cases have large tables of data. To make it easy for you to analyze them, I have arranged for data from all large case tables to be converted to Excel spreadsheets and placed on the Stern "X" drive (also called "Class on Facs/Apps1"). Once you are on the "X" drive, click on the folder MKT, then EGREENLE, then CASES. Each case has its own folder. Since some of you can only get to the X drive from Stern computers, you may find it convenient to download all case files at once onto a floppy or zip disk.

4. WRITTEN ASSIGNMENTS

You will be completing two kinds of written assignments.

Written case assignments you hand in. First, you are responsible for completing and submitting two written case assignments. Each is an in-depth analysis of a case. Both cases will give you experience at applying what you have learned in the course to solve specific marketing problems, and to combine different elements of the marketing mix to create marketing strategy and tactics, and make marketing decisions. They also give you experience at describing and justifying your decisions and the rationale for them in a clear and effective manner. This syllabus does not have study questions for these cases. Each case assignment earns 15% of your course grade. Late assignments will not be accepted except in personal emergencies. These cases are:

New Beetle - due March 4. Please complete this case in groups of three to five people.
Mary Kay Cosmetics: Asian Market Entry - due April 22. You have the option of doing this case in groups of three to five people, or individually.
Mary Kay Assignment

The New Beetle and Mary Kay assignments each will be handed out in class and posted on the course web site two weeks before they are due. Each is due on a Monday, to give you the weekend to work on them. You may discuss general concepts in these assignments with your classmates, if you wish, but the specific analysis, recommendations and rationale, and writing should be your group's own work (New Beetle) or your own or your group's (Mary Kay).

Written assignments you do not have to hand in. You will also complete four briefer written assignments designed to give you practice in applying some important quantitative methods in marketing and linking them to qualitative analysis. These assignments are based on cases or on information that I will provide. Note that you will complete these assignments after reading about these methods in the text and handouts but before we discuss them in class. This gives you a chance to get "get your feet wet" with some experience at how these quantitative methods work and the issues they address. This kind of experience helps you get more out of the class discussion and contribute to it. However, since you will be a "novice" in these methods when doing these assignments, I don't expect you to do a perfect job - the focus is on initial experience and learning. For this reason you do not have to hand them in. I'll distribute answer guidelines for these assignments, to help you evaluate your own work and understand any areas where you had problems. Please be sure to do these assignments and compare them with the answer guidelines. They will they help you learn the material better, similar problems will be certain to appear on the midterm and final exams, and you can also apply many of these concepts to the written case assignments. I encourage you to work on these assignments in groups, so you can learn from and help each other.

These assignments are:

1) Quantitative analysis assignment for Calyx & Corolla - due Feb. 4
2) Estimating the value of a Calyx & Corolla customer - due Feb. 20
3) Predicting consumer demand using test-market results - due April 1
Assignment to do soon after April 1 class
4) Proposing cost- and value-based prices for Cumberland Metal Industries - due April 8
Assignment

5. EXAMS

The Midterm Exam during class on Monday, March 25 earns 25% of your grade, and the Final Exam on Wednesday, May 8 earns 35%. For more information on these exams and advice on how to prepare for them most effectively, look at the web site entry under the Midterm and Final.

6. YOUR COURSE GRADE WILL BE DETERMINED BY:

The **Midterm Exam** during class on Monday, March 25 earns 25% of your grade, and the Final Exam on Wednesday, May 8 earns 35%.
Sample Midterm

New Beetle Assignment

Students occasionally ask about my policy on regrading exams and assignments. At the request of many Stern students in past semesters, we will use the following policy:

If you wish an assignment to be regraded, please submit this request to me in writing, explaining carefully why you request the regrading, and include the original assignment. Remember, grading any assignment requires the grader to make many judgements on how well you have answered the question. Inevitably some of these go in your "favor" and some not, but taken together they usually assess fairly the abilities you displayed in the assignment. It is inappropriate for me only to consider issues where you question the grading judgement without also considering instances where you were given the benefit of a doubt. Consequently, if you want a grade to be reconsidered, especially on several points, it may be necessary to regrade the entire assignment. I have instituted this policy out of fairness to all students, many of whom have requested me to use it. It is not intended to discourage people from questioning a grade, but rather to get them to think carefully when making these requests.

7. TEACHING FELLOWS

The Teaching Fellows for the course are Christina Good, Daniel Lee, and Donald Lichter. All are second-year students who excelled in this course last year. Each TF will hold two, one hour office hours each week in the Teaching Assistance Center on the sixth floor of KMC. I urge you to see them, or me, if you have any questions or need help. Their TA hours will be announced once they have been confirmed by the Teaching Assistance Center.

8. MY OFFICE HOURS

My office hours are Monday from 12:00 - 1:30. We can also set up an appointment if you can't make this time. In general, you are welcome to drop by spontaneously, and if I am not too busy I'll be happy to talk with you. Please note that my office door is often closed, but do not take this as a sign that you are unwelcome - it's just that I often work with the windows open and close the door out of habit to avoid strong crosswinds.