Pennsylvania State University



THE PENNSYLVANIA STATE UNIVERSITY AT HARRISBURG

THE CAPITAL COLLEGE

Middletown, Pennsylvania

School of Business Administration

MRKT 520.1

SPRING 2002 Instructor: Dr. Erdener Kaynak

Class Time: Tuesday, 6:00-8:30 P.M. Office: E-356, Olmsted Bldg.

Class Room: E-254 Office Phone: 948-6343

E-mail: k9x@psu.edu

Office Hours: M & T: 4:30-6:00 p.m.

M & T: 8:30-9:00 p.m.

TR: 5:00-6:00 p.m.

(Other times when I am in my office and by appointment)

MARKETING MANAGEMENT

REQUIRED TEXT: Philip Kotler, Marketing Management, Millennium Edition, Prentice-Hall, Upper Saddle River,

New Jersey, 2000, 718 pages.

SUPPLEMENTARY TEXTS: (You may want to consult with these reading materials as supplements to the main

text and lecture notes).

Russell S. Winer, Marketing Management, Prentice-Hall, Inc., Upper Saddle, NJ, 2000,

551 pages. Call # HF5415.13.W5476 2000

Roger J. Best, Market-based Management: Strategies for Growing Customer Value and Profitability, 2nd Edition, Upper Saddle River, NJ: Prentice Hall, 2000.

Call # HF5415.13.B46 2000

J. Paul Peter and James H. Donnelly, A Preface to Marketing Management, 8th Edition, Boston: Irwin/McGraw-Hill, 2000, 318 pages. Call # HF5415.13.P388 2000

Michael E. Porter, Competitive Strategy: Techniques for Analyzing Industries and Competitors, The Free Press, New York, 1980, 396 pages.

Philip Kotler, Kotler on Marketing: How to Create, Win and Dominate Markets, Free Press, New York, 1999, 257 pages. Call # HF5415.13.K638 1999

Steven Wheeler and Evan Hirsh, Channel Champions: How Leading Companies Build New Strategies to Serve Customers, Jossey-Bass, San Francisco, CA, 1999, 223 pages.

Call # HF5415.W484 1999

George S. Day, The Market Driven Organization: Understanding, Attracting, and Keeping Valuable Customers, Free Press, New York, 1999, 285 pages.

Call # HF5415.13.D367 1999

Jagpal Sharan, Marketing Strategy and Uncertainty, New York, Oxford University Press,

1998, 334 pages. Call # HF5415.J33 1999

MRKT 520.1 SPRING 2002 Syllabus - E. Kaynak Page 2

Harper W. Boyd; Orville C. Walker, and Jean-Claude Larreche, Marketing Management: A Strategic Approach with a Global Orientation, Irwen/McGraw B Hill, 1998, Boston, Massachusetts, 547 pages. Call # HF5415.13.B669 1998

Torsten H. Nilson, Competitive Branding: Winning in the Market Place with Value-Added Brands, John Wiley, New York, 1998, 235 pages. Call # HF5415.13.N539 1998

William A. Cohen, The Marketing Plan, 2nd Edition, John Wiley, New York, 1998, 341 pages

Call # HF5415.13.C6348 1998

Philip Kotler, Marketing Management: Analysis, Planning, Implementation and Control, 9th Edition, Upper Saddle River, NJ: Prentice Hall, 1997. Call # HF5415.13.K64 1997

John Westwood, The Marketing Plan: A Practitioner’s Guide, 2nd Edition, Kogan Page, London, 1996, 224 pages. Call # HF5415.13.W48 1996

COURSE OBJECTIVES:

The objective of this course is to provide graduate marketing students with the conceptual background and the analytical tools that are used in solving strategic marketing problems. The text and assigned readings furnish the conceptual background for effective analysis of marketing problems; the cases utilize practical application tools for making strategic marketing decisions. To operationalize this objective, class discussion will be geared toward evaluating marketing information to develop comprehensive and integrated marketing strategies. These discussions will nurture students' understanding of the development of marketing plans and programs; will emphasize theory; and, will foster the integration of the various marketing management elements into a comprehensive marketing strategy and program.

COURSE STRUCTURE:

The course consists of a mixture of lectures, discussions, internet and case study exercises - each being used and applied when appropriate. This course is designed on a modular basis and no one module is self-contained. That is to say that all the modules represented show discrete steps in a sequential learning process for orderly marketing decision making purposes. Each module presented is designed in such a way to stress a particular aspect of marketing management and will be summarized by problem solutions and the medium of a case study and/or internet exercises.

CASE STUDIES:

At the end of each module, each student is expected to solve assigned cases in class. Each person is expected to make a written submission on a selected case and present that case in class. Case analyses should not exceed 12 pages, word processed with double space margin. On every occasion, the case material assigned must be thoroughly prepared by all students beforehand and a detailed knowledge of the material will be expected from each student. Only those students who are responsible to present/critique a case will do the formal discussion in class.

Since there are no perfect solutions to the cases assigned, students will be graded one: (a) organization, (b) understanding the marketing issues, (c) originality of ideas and solution alternatives, (d) breadth and depth of coverage of the issues, (e) clarity of exposition, and (f) thoroughness in integrating the multiple components of the cases. Students will be expected to avoid the common errors listed on the last page of this syllabus in their analyses of the cases.

MRKT 520.1 SPRING 2002 Syllabus - E. Kaynak Page 3

COURSE FORMAT:

The subject matter of this course is vital, dynamic, practical, controversial and fascinating. In order to make this course an enjoyable learning experience, it is essential that you: (a) read ahead in your textbook before class on a weekly basis, (b) read all assigned materials, (c) attend classes regularly, (d) prepare yourself for cases, internet exercises and discussion questions, and (e) raise your viewpoints during class periods. Each student is expected to contribute regularly to class discussion, as called upon by the instructor and on a voluntary basis.

COURSE OUTLINE:

Minor changes may be necessary as the course progresses. One pass-in case is expected from each student. It is expected that assignments be turned in on time. Attendance is mandatory; class participation can be an important component of the course grade. Students are urged to contact the instructor ahead of time for possible delays in meeting deadlines. Those students who hand in their assignments late without any legitimate excuse will be penalized by five percent per each calendar day.

INTERNET EXERCISE:

Students are expected to read all internet exercises assigned each week. Each student must submit a typed review (maximum of ten pages long) of one company. Contents and messages of every presented company will be discussed in class on a weekly basis. Please come to class as prepared. Please come to class as prepared. Below please find a suggested procedure for review and discussion.

1. Internet and e-commerce objectives of the company:

a) Major theme

b) Overall messages presented

c) Practical marketing applications

2. Evidence provided on the company web page:

a) Key points of the company practices through internet endorsed by the existing marketing literature

compared to their brick and mortar operations

b) What empirical marketing evidence is offered

c) Vision, mission, and objectives of the company

d) Facts and figures provided

3. Contribution of the company’s marketing practice through internet to marketing management knowledge:

(a) Strategic advantages of internet marketing as against brick and mortar marketing

(b) Managerial and/or public policy implications of internet marketing operations of the company

(c) Future directions of internet/e-commerce/online marketing in the industry

4. Your independent views/critiques/recommendations of the company’s marketing performance and effectiveness

Through the use of internet/e-commerce/online marketing mediums

a) What needs top be done to improve the quality and effectiveness of this company’s internet marketing

Effort?

MRKT 520.1 SPRING 2002 Syllabus - E. Kaynak Page 4

GRADING PROCEDURE:

Students will be graded on their performance in the following course components:

(1) Written (12 pages) One Person Pass-in Case Analysis 10%

(2) Internet Exercise 20%

(3) In-Class Presentation and Discussion of Cases (10%)+(10%) 20%

(4) Mid-term Exam 15%

(5) Class Participation and Taking Part in In-class

Discussions 15%

(6) Term Paper Report* 20%

100%

* Written Report: Marketing is a universal subject whether we talk domestic or international marketing as the same concepts and techniques apply. What is different is the application of those concepts and techniques in different markets. The purpose of the term paper is to apply the marketing strategy and planning knowledge gained in the course into one of the following topics with special reference to the state of Pennsylvania. No other topic will be entertained:

Marketing Planning for Household Appliances

Competitive Marketing Strategy for Apparel and Garment Industry

Strategic Marketing Planning for Furniture Industry

Internet, E-commerce and On-line Marketing Strategies

Marketing Planning for Residential Housing

Product Development and Market Segmentation Strategies for Confectionary Products

Marketing Strategy for Toiletry Industry

Positioning Strategy for Pennsylvania Tourism

Marketing of Pennsylvania as a Place for Investment

Strategic Marketing for Pharmaceutical Products

COURSE SCHEDULE AND OUTLINE

PART I: UNDERSTANDING MARKETING MANAGEMENT

January 8 Orientation

Foundations of Strategic Marketing Management

Case Study Analysis and Problem Solutions

MRKT 520.1 SPRING 2002 Syllabus - E. Kaynak Page 5

January 15 Marketing in the Twenty-First Century

Readings: Kotler, Chapter 1

Case 1: : Wal-mart

Internet Exercise 1:

January 22 Building Customer Satisfaction, Value, and Retention

Readings: Kotler, Chapter 2

Case 2: Enterprise Rent-a-Car

Internet Exercise 2:

January 29 Winning Markets: Market-Oriented Strategic Planning

Reading: Kotler, Chapter 3

Case 3: RJR’s Eclipse: Rising From Premier’s Ashes

Internet Exercise 3: AOL: World Online?

PART II: ANALYZING MARKETING OPPORTUNITIES

February 5 Gathering Information and Measuring Market Demand

Reading: Kotler, Chapter 4

Case 4: AIBO: Looking for a Charged-Up Spot?

Internet Exercise 4:

February 12 Scanning the Marketing Environment

Readings: Kotler, Chapter 5

Case 5: The Newest Avon Lady- Barbie

Internet Exercise 5:

February 19 Analyzing Consumer Markets and Buyer Behavior

Analyzing Business Markets and Business Buying Behavior

Reading: Kotler, Chapters 6 and 7

Case 6: Global Star: Connecting Everyone, Everywhere

Internet Exercise 6:

February 26 Dealing with the Competition

Reading: Kotler, Chapter 8

Case 7Biofoam: Not Just Peanuts!

Internet Exercise 7:

March 4 - 8 SPRING BREAK - NO CLASSES

MRKT 520.1 SPRING 2002 Syllabus- E.Kaynak Page 6

March 12 Identifying Market Segments and Selecting Target Markets

Reading: Kotler, Chapter 9

Case 8: Ryka: Be Strong

Internet Exercise 8:

PART III: DEVELOPING MARKETING STRATEGIES

March 19 Positioning the Market Offering Through the Product Life-Cycle

Readings: Kotler, Chapter 10

Case 9: Swatchmobile: Is the Time Right for Small Cars?

Internet Exercise 9:

March 26 Developing New Market Offerings

Managing Product Lines and Brands

Reading: Kotler, Chapters 11 and 13

Case 10: Lifesource Nutrition: Succeeding Where Campbell Soup Failed

Internet Exercise 10:

April 2 Designing Global Market Offerings

Reading: Kotler, Chapter 12

MID-TERM EXAM

PART IV: MAKING MARKETING DECISIONS

April 9 Designing Pricing Strategies and Programs

Reading: Kotler, Chapter 15

Case 11: Circuit City: Selling Used Cars Like Stereos

Internet Exercise 11:

PART V: MANAGING AND DELIVERING MARKETING PROGRAMS

April 16 Managing Marketing Channels

Reading: Kotler, Chapter 16

Case 12: Icon Acqustics: Bypassing Tradition

Internet Exercise 12:

MRKT 520.1. SPRING 2002 Syllabus - E. Kaynak Page 7

April 23 Managing Integrated Marketing Communications

Managing Advertising, Sales Promotion

Reading: Kotler, Chapters 18 and 19

Case 13: Proctor and Gamble

Internet Exercise 13:

April 23, 2002 Term Paper is Due

April 26, 2002 Classes End

SUGGESTIONS FOR ANALYZING A MARKETING CASE

In analyzing a marketing case consider the following:

a. Read through the case quickly to determine its general nature. Then re-read and begin to sort out facts. During subsequent readings it will probably be desirable to outline and re-arrange the material in the case, or to prepare tabulations and charts that permit of more ready comparison of available data and information.

b. After you have mastered the facts and other information in the case, isolate the major problem(s) to be solved. If the problem is stated at the end of the case, use these questions as general guidelines. In cases of answering these questions only, you will gain partial grade.

c. Then determine the major topics around which the case analysis is to be undertaken. Some major points commonly encountered in marketing problem analysis are:

(1) The market and its influence on problem(s) and decision making.

(a) present market(s)

(b) potential market(s)

(c) size and/or characteristics of market(s)

(d) buying habits and motives of customers

2) The product and its influence on problem(s) and decision

Making.

(a) characteristics of the product(s)

(b) classification of the product(s)

(3) Channels of distribution and/or distributive outlets and systems and their influence on problem(s) and decision-making.

4) Reactions of channel intermediaries, customers, or others (if not included above) and their

influence on problem(s) and decision making.

MRKT 520.1 -SPRING 2002 E. Kaynak – Syllabus Page 8

(5) Reactions of salespersons and/or other company personnel and their influence on problem(s) and decision making.

(6) Competition types, reaction and probable future action of competitors and their influence on problem(s) and decision-making.

7) Effectiveness of retaliation of competition, middlemen, others and their effect on problem(s) and

decision-making.

8) Importance of good will and effect on problem(s) and decision-making.

(9) Position of the company in the industry and effect of this on problem(s) and decision making.

(10) Financial position of the company and effect on problem(s) and decision-making.

(11) Importance of price, elasticity of demand, and effect on problem(s) and decision-making.

(12) Effect of problem(s) on other product lines and/or affiliated companies.

(13) Seriousness of the problem, degree or urgency, time and funds available before action must be taken and the effect or influence of these factors on decision-making.

(14) Economic conditions, trends and structural developments within the industry, and their effect on problem(s) and decision-making.

(15) Effect of problem(s) on sales volume, costs, and profitability, and their influence on problem(s) and decision-making.

a. Immediate (within a financial year)

b. Short run (1 to 3 years)

c. Medium run (3 to 5 years)

d. Long run (more than 5 years)

(16) Does probable profit commensurate with risk involved?

a. The foregoing list is not to be all-inclusive or necessarily in order of importance. Not all points will require consideration in each case, and some cases may involve areas of analysis not listed above.

b. Proceed with the analysis of the major points or areas

(1) For the purposes of this course, the analysis is the most important part of the report. At this time the reasoning whereby the recommended course of action is arrived at carries more weight than actual decision.

(2) The analysis consists in part, of studying the problem from many different aspects and attempting to foretell the probable effect upon, or reaction of, the many factors which influence the success or failure of a certain course of action.

MRKT 520.1 -SPRING 2002 E. Kaynak - Syllabus Page 9

a) As the analysis proceeds, alternative courses of action (strategic

alternatives) or possible solutions to the problem will come to mind.

These must also be examined and their feasibility appraised in much

the same way as is the original problem. In fact, as the analysis

progresses, it may be discovered that the problem(s) originally stated

requires modification, or that the whole approach to the case needs to

be changed.

b) To be complete, the analysis must take into consideration not only the strong points of each argument presented, but the weaknesses of each as well. The analysis of one set of factor will indicate one course of action while the analysis of others may indicate a different solution. It is important to recognize in advance the probable alternative(s) available.

c) Occasionally some assumptions may be made. These should be logical and set forth clearly. Do not make unnecessary assumptions or assumptions which are contrary to facts already given in the case.

(d) In a few instances more data may be desirable. Use should then be

made of the secondary sources available in the library, internet

sources, company web pages or other pertinent outside information.

(3) Based on the case analysis, arrive at one or more possible decisions as to the proper course of action to be taken in order to solve the problem facing the firm. If, as is customary, more than one solution appears reasonable, choose the one which, all factors considered, seems to contain the greatest strength and the fewest disadvantages. Be sure that your arguments are based upon the facts of the case, upon logics and clear-cut reasoning, and upon such assumptions as are made. Please also use your knowledge of marketing concepts and techniques as well as other functional area of business knowledge.

COMMON ERRORS ENCOUNTERED IN STUDENT MARKETING CASE REPORTS

1. Students simply repeat and rehash data provided in the case. Use data, don't just give it back. Provide added value on the available data and information.

2. Some students conclude that the data is inadequate and no decisions may be reached. It is better to use what you have or get additional material from the library and online sources as well as from company managers.

3. Failure to deal adequately with numbers.

If you are given numerical data, be sure to analyze them using quantitative analysis procedures such as trend, cross-classification, pricing, cost, break-even and margin analyses, and other qualitative research techniques.

MRKT 520.1 -SPRING 2002 E. Kaynak - Syllabus Page 10

4. Failure to pursue case analysis to a logical conclusion.

Don't stop halfway through; cover all of the important issues raised in the case. Remember that your analysis and interpretation of the data is more important than the alternative courses of action proposed, solution you recommend or the conclusions at which you arrive.

5. Failure to organize report clearly and adequately.

Reports should begin with a short problem statement, move to an analysis section with appropriate headings and subheadings, and end with a set of specific recommendations. Some students simply string together a series of random compound thoughts and sentences. Your analysis should flow and have continuity, consistency and clarity. Follow a clear structure in presenting your ideas and thoughts.

6. Failure to be decisive.

This is especially important when you are making your final recommendations and suggesting the ways your ideas are going to be implemented. Also, when you encounter conflicting data, don't hedge, state your assumptions and fly with them and stand by them. A bad decision is better than having no decision!

7. Excessive grammatical and typing errors.

Avoid incomplete and awkward sentences. Pay particular attention to your sentence structuring. Be careful with tense; avoid the use of I, we, it. Once a student employs those words they are often overused. Also avoid colloquial expressions. Do not shorten words.

8. Improper Referencing and Footnoting

Prepare a References section at the end of the case analysis Report. All outside references used must be

presented in alphabetical order. If you use web page data and information, provide the sources of

information under Footnotes by using numbering system.

9. Failure to read report after it is typed.

Correct all grammatical errors and be sure all pages and tables are included in the proper order. Insert page numbers and tables and figures should also be consecutively numbered. Your report should be neat and nicely presented.

GENERAL STRUCTURE OF A STRATEGIC MARKETING PLAN

It will ideally cover the following planning components:

I. Situational analysis

(a) Demand

(b) Competition

(c) Distribution structure

(d) Marketing law

(e) Non-marketing cost

MRKT 520.1- SPRING 2002 E. Kaynak - Syllabus Page 11

II. Problems and Opportunities

III. Marketing Strategy

(a) Objectives

(b) Methods

(1) Product strategy

(2) Distribution strategy

(3) Pricing strategy

(4) Promotion strategy

(a) Advertising

(b) Personal selling

(c) Sales promotion

(d) Publicity and Public Relations

IV. Marketing tactics

(a) Who

(b) What

(c) When

(d) Where

(e) How

CASE METHOD OF ANALYSIS IN MARKETING

I. SITUATIONAL ANALYSIS

It is unnecessary to regurgitate the case and its history. Your analysis must be specific and include a discussion of pertinent case information and information and data obtained from outside. The purpose of the situational analysis is to critically analyze case information and should lead to the decision of alternative courses of action. Your situational analysis must be fully reinforced with sufficient reasoning and well-organized. The analysis could be subdivided into five major categories:

i) Analysis of the Company and its Objectives

ii) Analysis of Marketing Decision Variables

iii) Analysis of the Competition

iv) Analysis of the Environment

v) Analysis of the Industry Distribution System

vi) Analysis of the Market

20%

MRKT 520.1- SPRING 2002 E. Kaynak - Syllabus Page 12

II. PROBLEMS AND/OR OPPORTUNITIES

* State major and underlying problems. Give explanation of these. Take into consideration company objectives as well as short, medium, and long term goals.

* Identify strengths and weaknesses of the company.

* Opportunities available to the company - develop and explain these ideas.

15%

III. ALTERNATIVE COURSES OF ACTION

You must identify all possible alternative courses of action (strategic alternatives). You must devise a strategy for each and fully explain your reasoning. Alternatives must be reinforced by an evaluation of the pros (advantages) and cons (disadvantages) of each in point form. If alternatives are given in the case, do not regurgitate these. Further elaborate on these, developing a sufficient strategy for each.

40%

IV. RECOMMENDED MARKETING STRATEGY AND IMPLEMENTATION

You must firmly validate your reasoning for your selected course of action. You must further outline the major components of the chosen course of action and elaborate on why it is appropriate to the problem. Please take short and long term goals into consideration when devising a strategy.

25%

ACADEMIC INTEGRITY:

The University requires its members to behave with academic integrity. Specific examples of behavior which breaches the rule requiring academic integrity are provided in Rule 49-20 of the current University’s Policies and Rules for Students.

IMPORTANT NOTES:

No recording devices, cellular phones or pagers are allowed in class.

For all outside sources used in the completion of assignments, you are expected to give proper references and footnotes. If in doubt about referencing guidelines, please refer to The Publication Manual of The American Psychological Association (APA) which is available in the library.

No make-up exam or handing in assignment late is permitted unless a doctor’s note is provided.

Please be punctual in arriving in class. The instructor is not responsible for providing lecture notes for missed classes, unless there is a legitimate excuse. In this case, the instructor must be informed in advance.

MRKT 520.1 SPRING 2002 E. Kaynak - Syllabus Page 13

CHECKLIST OF DO'S AND DON'TS IN MARKETING CASE ANALYSIS

CONCEPT DO DON'T

1

| Finding the |Start with the firm’s customers and their needs if you do not know|Do not assume the problem is given. No problem is |

|Problem(s) |where to begin. Start with identification of symptoms as these |self-evident. |

| |symptoms may lead to identification of problems. | |

| Problem |List the two or three major problems that are occurring in the |Do not mix minor and major problems together. |

|Reporting |company. |Solving small problems usually is not enough. |

| | | |

| Report |Provide direction to your written analysis. Address your report |Do not write without a particular person in mind. |

|Direction |to a specific person or group (i.e: Board of Directors). |Your have an audience to whom you are selling your |

| | |ideas. |

| Report |Cover the following areas: statement of the problem, proof that |Do not cover the following areas: the firm’s history |

|Content |you have found the problem recommendations. Prove your |or minor personality problems or those problems are |

| |recommendations are worthwhile. |not related to marketing. |

| | | |

| Financial |Use the data and information given. Know how to compute basic |Do not skip over tables and charts. You should spend|

|Data |financial ratios and investigate the balance sheet and profit and |more time on these than you do with text space of |

| |loss accounts if they are given. |similar size. |

| Recommendations |Make specific recommendations and prove why they should be |Do not be vague or call for a “re-evaluation”. Your |

| |adopted. Support of your ideas with your knowledge of marketing is|ideas are meaningful when offering improvements to |

| |needed. |company operations. |

| Plans |Offer the steps (methods) that should be used or adopted to carry |Do not assume a good recommendation is enough. The |

| |out your recommendations. Who is going to do what with what |method of implementing your recommendation should be |

| |resources? |given in detail. |

| | | |

| Organization |Use a format that has sub-headings to ensure good organization of |Do not write without breaks between major sections in|

| |thoughts and a reader can easily comprehend your recommendations. |your paper. |

| Imagination |Use outside material, including web pages and online data. |Do not begin writing without gathering all relevant |

| |Experts on the subject can be interviewed. You could even do your|data and information. |

| |own small market survey. | |

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