Faculty
Professors Christian S. M. Dussart, Kevin L. Keller
Objectives
Marketing is the business function that deals with customers' needs and wants. The role of marketing management is to help companies better understand customer preferences, link that knowledge to designing appropriate products and services for selected customers, and determine appropriate methods to communicate, to capture, and to deliver value. Successful firms are those that pursue objectives, employ resources, and invest in the future of an organization to consistently satisfy the needs of customers better than competitors. These ideas apply to both for-profit and not-for-profit organizations.
The objectives of the course are:
1. To introduce you to the key elements in developing a marketing strategy and planning a marketing program.
2. To enhance your problem-solving abilities in operational areas of marketing by providing you with a set of analytical tools (i.e., frameworks, concepts, models, and techniques).
3. To present examples of how firms organize their marketing efforts across a broad range of business settings (e.g., consumer packaged goods, pharmaceutical, telecommunications, financial services, B2B markets).
4. To provide you with a forum (both oral and written) for presenting and defending your own recommendations, and for critically examining others’ recommendations.
To accomplish these objectives, we will use a combination of lectures, case studies, exercises, readings, as well as a computer simulation (MarkStrat) to stimulate and reinforce learning.
Requirements
1. Class Participation
Effective classroom learning depends on your thorough preparation and active participation. Attendance is required. Please see the MBA Student Handbook Section III for a full statement of school policy on attendance. If you are unable to attend class for any reason, you are expected to notify me (Jackie.Luan@tuck.dartmouth.edu) and Alison (Alison.Pearson@dartmouth.edu) by email in advance. It is Tuck School policy that missing a class for an interview is NOT an excused absence. It is your responsibility to work with recruiters and career services to minimize such disruptions. However, we recognize the importance of your job search and understand that, in some cases, such conflicts are unavoidable. However, more than two unexcused absences will result in a penalty above and beyond your class participation grade for the missed sessions.
Also keep in mind that your grade for participation is not simply a function of the "air time" you take up. In general, you will be evaluated on how actively you contribute to the learning of the class, how thoughtfully you respond to questions, and how effectively you take into account the comments of your classmates in formulating your opinions.
Lectures/Discussions: We will focus on principles, theories, and applications in these sessions. Although there will be some “lecturing” on my part, I intend these sessions to be an interactive and collaborative learning experience, where questions, discussions and debates are encouraged.
Case Studies: The case method is a highly effective means of sharpening your decision-making skills and applying the theories discussed in lectures and readings to real-world problems.
In preparing for a case discussion, you should read the case more than once. The first reading should give you an impression of what the case is about and the types of data contained in the case. Be sure to pay attention to the exhibits in the case. The exhibits often contain information that will be useful in analyzing the situation. Once you have a good idea of the fundamentals, you should read the case again with the goal of getting at the root causes of problems and gathering data from the case that will allow you to make specific action recommendations. During this reading, carefully prepare your answers to the assigned discussion questions. You should then discuss these questions in your study groups. The study group is a useful and informal forum in which to test your ideas.
When discussing the case in class, I will “cold-call” as well as solicit voluntary contributions. Some discussion questions require arithmetic spreadsheet calculations; you should be prepared to discuss your Excel spreadsheets in class.
Cases provide all the facts that should be used. You should not access other sources or find out what actually happened in preparing your case analysis. Doing so is often counterproductive.
Laptop Policy: Laptops are allowed for note-taking and in-class exercises only. Any other activities (such as emailing, web browsing, instant messaging, gaming) are strictly prohibited, and doing so would seriously compromise your class participation grade.
2. Written Assignments
Your group can choose any one of the five cases covered in the course to complete a case write-up. Each write-up should address all of the discussion questions listed in the syllabus for that case and is restricted to 5 double-spaced pages. Exhibits are not included in the page limit but should be used sparingly.
General case write-up guidelines: Provide a coherent, well-organized analysis, not simply a list of arguments for or against a position. Be concise and do not spend time rehashing or paraphrasing the details of the case. Focus on the specific issues raised in the discussion questions and be as direct as you can in your answers.
For all the cases except for Black & Decker, there is a spreadsheet question that involves quantitative analysis and/or modeling. The spreadsheet question is signified in the discussion questions under each case. Your group can pick two cases other than the case you pick for the full case write-up to hand in the answer to this spreadsheet question. For each, your group should hand in a brief document (1-2 pages) with your spreadsheet analysis and conclusion. (You might want to refer to the assignment Format Guide in DecSci if you are unsure how to make your quantitative analysis readily comprehensible to readers.) Make your assumptions explicit whenever necessary.
There are two additional group exercises (“Conjoint Analysis” and “New Product Demand Forecasting”) and one individual exercise (“Super Bowl Ads”) over the course of the term.
All written assignments should be submitted in hard copy before that class session begins. Late submissions will be downgraded by 20-50%.
3. MarkStrat Simulation
MarkStrat is a computer-based simulation game that allows you to practice the strategic marketing concepts and skills learned during the course in a virtual marketplace. During the simulation, your study group will be competing with 3 other groups for six decision cycles, during which you will analyze market research in real time, formulate and revise your marketing strategy (segmentation, targeting, positioning), make tactical marketing decisions (e.g., pricing, advertising, new product development), and learn from the reactions of the market.
We will kickoff the simulation on Feb. 18, by which you should have
(1) registered for MarkStrat Online,
(2) downloaded and installed the Team Software, and
(3) read the Student Handbook.
Instructions for (1) and (2) are provided in the memo “MarkStrat Intro for Students” in the course folder.
The simulation comprises six decision rounds, each of which takes 1-1.5 hours on average for your group, and you will probably spend more time on early rounds than later rounds due to the learning curve. Please schedule ahead of time to accommodate these group sessions. Your grade for the MarkStrat game will depend on your firm’s financial performance (measure by key indices such as stock price, profitability, and market share), on the quality of your strategy and implementation, and on the key lessons learned. In addition, to dissuade unrealistic end-gaming, your team’s final strategic position will be considered in the overall evaluation.
You should keep a good record of your experiences and strategies during the game. After the results from the final decision cycle are revealed, your team will prepare a written report and give a five-minute presentation to the class based on the report.
4. Final Exam
There will be an open-book open-notes individual take-home exam. The exam is made available on March 6 and is due by March 9 at noon. A drop box will be placed outside Alison s office at Tuck 205I.
Materials
Required Materials
1. Course packet: includes syllabus, cases and supplementary readings.
2. Philip Kotler and Kevin Lane Keller, Marketing Management: Analysis, Planning, Implementation, and Control, 13th edition.
3. MarkStrat Online Student Handbook by StratX. (The book contains your individual serial number required to participate in the simulation. Do not misplace the book or the serial number card during the term.)
4. Course Folder: Lecture slides, homework solutions, spreadsheets and other course materials will be placed in the course folder on an as-needed basis.
Application of the Academic Honor Principle
The prevalence of group work is consistent with the principle that much of your education here will come from each other, and we encourage you to discuss all cases and other materials with your group prior to coverage in class. However, any individual work, including the individual exercises and the notes prepared for case discussions, should be developed and modified on an individual basis.
It is a violation of the Honor Principle to use notes from earlier years' classes at any time. Do not redistribute class slides, notes, or handouts to anyone not enrolled in this course without my permission.
Group work is abundant throughout this course and accounts for over half of your final grade. If your name is on the final product (e.g., case write-up or MarkStrat report), you must have put significant effort into the preparation process. Individuals will not receive credit for group work if they have not met this expectation. My consideration of this issue in a specific instance would be initiated by group members who, after unsuccessful and documented warnings to the individual, explain their concerns to me in writing (email or letter, signed by a majority of group members). I will usually be able to decide what should be the outcome of the case after consulting the individual and all group members. However, it may be necessary to refer the case to the Academic Honor Committee (see Student Handbook).
According to the Dartmouth College Academic Honor Principle, “Plagiarism is defined as the submission or presentation of work, in any form, that is not a student’s own, without acknowledgement of the sources.” Any form of plagiarism constitutes an affront to academic integrity and honesty and is therefore strictly prohibited.
Grading
Individual
Class participation 15%
Super Bowl Ads exercise 6%
Final exam 20%
Group
Conjoint Analysis exercise 8%
New Product Demand Forecasting exercise 7%
Case write-up 12%
Two additional case spreadsheets 12%
MarkStrat (performance, presentation and report) 20%
Total 100%
Schedule
1. 1/8
Introduction to Marketing Management
Syllabus
Kotler & Keller, Chapter 1, pp. 1-19.
Discussion Questions:
Google Inc. has recently launched “Google TV Ads,” a new service for advertisers to purchase and place advertisements on TV (http://www.google.com/adwords/tvads/). Google started the service by selling advertisers TV “slots” (15-second or 30-second advertising spots) made available through Dish Network, but more recently has also gained access to slot inventory owned by NBC Universal. The TV ad slots are sold through a similar auction process that Google sells keywords for Internet search ads. The attraction is clear: TV advertising is a $77.5 billion market -- capturing just a 2% share of that market would double Google’s current worldwide revenue. Please read the three related news articles in your course packet and be prepared to discuss the following questions in class:
Will “Google TV Ads” become a successful venture? What does “Google TV Ads” have going for it and what are the obstacles?
What should Google do to increase the probability of success?
2. 1/9
Consumer Behavior and Customer Analysis
Kotler & Keller, Chapter 4, pp. 90-109.
Harrington and Tjan, “Transforming Strategy One Customer at a Time,” Harvard Business Review, March 2008.
The “Useful Marketing Metrics” memo. (You may need to refer to this note repeatedly over the course of this term.)
Conjoint individual spreadsheet due (To complete this assignment, follow the instructions given in “Conjoint_Individual.doc” in the course folder).
Discussion question:
After reading the Harrington and Tjan article, make a list of the various types of marketing research studies conducted by the Thomson Corporation. For each item on your list, consider the following questions:
What research question did it address? Why is this question managerially important?
In general, what are the pros and cons of this marketing research approach?
3. 1/14
Segmentation, Targeting, and Positioning
Kotler & Keller, Chapter 8, pp. 213-232.
Kotler & Keller, Chapter 10, pp. 268-276.
Conjoint group exercise due (To complete this assignment, follow the instructions given in “Conjoint_Group.doc” in the course folder).
4. 1/15
Guest Speaker: Mark Addicks (Chief Marketing Officer, General Mills)
Note: This guest lecture will take place at 1:15-2:45 p.m. for all sections in Cook Auditorium. There is no regular class meeting on this day.
5. 1/22
Case: Black & Decker
Black & Decker Corp. (A): Power Tools Division
Discussion Questions:
Why is Black & Decker, the overall market leader, doing poorly in the Professional-Tradesman segment?
As Black & Decker weighs its strategic options, what are its strengths and weaknesses relative to competitors (especially Makita)?
Which of the three options should Black & Decker choose? Specifically:
Option 1 implies Black & Decker should not target the Tradesman segment. Do you agree? Why? (Hint: use the 3Cs framework in analyzing this targeting problem.)
If Black & Decker decides to remain competitive in the Tradesman segment, would you recommend Option 2 or 3? Furthermore, how would you like to position the brand? Explain. (Hint: you might find perceptual maps and the POPs vs. PODs framework helpful in addressing this positioning problem.)
What actions should Black & Decker take to achieve the positioning you recommend above?
6. 1/23
Pricing
Kotler & Keller, Chapter 14, pp. 375-397.
Thaler, Richard H. (1999), ”Mental Accounting Matters,” Jounral of Behavioral Decision Making, 12(3).
7. 1/28
Case: Medicines Co.
The Medicines Company (HBS 9-502-006)
Discussion Questions:
What is the Economic Value to Customer (EVC) per dose of Angiomax to a hospital, for “low-risk”, “high-risk”, and “very high-risk” patients, respectively? **
Draw a Value Thermometer relevant to the Angiomax pricing decision. Identify relevant benchmarks as well as upward or downward pressures.
What price would you recommend Medicines charge per dose of Angiomax? Why?
Based on your pricing recommendation, outline a promotion plan for Angiomax’s launch. (You might find it helpful to approach this problem using the Consumer Decision-Making Unit analysis framework).
Evaluate the sustainability of the Medicines Company’s business model. What should it do next if Angiomax proves successful?
Spreadsheet assignment: Q1 above
** Note: The first question asks you to calculate the EVC of Angiomax for the 'Low Risk,' 'High Risk,' and 'Very High Risk' patients. We interpret these to be three distinct, non-overlapping groups. However, the numbers in Table B on page 8 apply to both High Risk and Very High Risk patients, i.e., the 2161 Angiomax patients in Table B contain the 369 Very High Risk patients in Table C. To produce separate calculations for (Moderately) High Risk patients, you will need to "back out" the risk rates for the 2161-369=1792 patients in Table B who are High Risk but not Very High Risk.
8. 1/29
New Product Development
Kotler & Keller, Chapter 20, pp. 565-588.
“Losses in Space: Iridium’s Downfall,” The Wall Street Journal, Aug 18, 1999.
Discussion questions:
In the Iridium case, which stage in the new product development process do you think was most accountable for the product’s failure? What would you have done differently?
9. 2/4
Case: Rohm & Haas
Rohm & Haas (A): New Product Marketing Strategy (HBS 5-587-055)
Discussion Questions:
Prior to launch, what reasons did Joan Macey have to be optimistic about the prospects for Kathon MWX?
Why is Kathon MWX not selling?
What is the Economic Value to Customer (EVC) of MWX to the end-user (i.e., what price of MWX would leave the user indifferent between using MWX and not using any biocide)? Similarly, what would be the breakeven price for an industrial supply / machine tool distributor (i.e., what price would leave these intermediaries indifferent between selling MWX and not selling it)? Note that you do not have the data to calculate the breakeven in terms of profits for the intermediaries, but you can calculate it in terms of revenues. What do the analyses above tell you about MWX’s current price?
What would you recommend to Joan Macey to increase sales and get MWX on track? How feasible is each of your recommendation for Rohm & Haas?
Where in the New Product Development (NPD) Process did Rohm and Haas go wrong? What should they have done differently?
Spreadsheet Assignment: Q3 above.
10. 2/5
Marketing Communications
Kotler & Keller, Chapter 17, pp. 470-480, 491-494.
Super Bowl Ads individual exercise due
Watch the commercials broadcast during the 2009 Super Bowl Game on Feb. 1. If you will not be watching the Super Bowl Game, you can usually view the ads on websites such as www.aol.com , www.youtube.com, or www.superbowl-ads.com. Limit your write-up to 3 double-spaced pages maximum.
Pick an ad that you consider highly effective and an ad that you consider highly ineffective and comment on each. In your evaluation, you should address the following: (i) Who is the target audience that the ad is trying to reach? Does it resonate with the target audience? (ii) Which stage(s) of the customer decision-making process (DMP) is the ad trying to influence? (iii) What is the key message communicated? What creative strategies are employed (p. 477) to deliver its intended message?
Super Bowl spots are notoriously expensive (a 30-second ad costs about $2.5 million). Suppose the Game is watched by 90 million viewers, what is the CPM of a Super Bowl ad? How is it compared with a primetime network TV spot (e.g., “CSI” or “Grey’s Anatomy”) with a CPM of about $20? (See “Useful Marketing Metrics” for a definition of CPM.)
11. 2/11
Case: Charles Schwab
Charles Schwab & Co., Inc.: The "Talk to Chuck" Advertising Campaign (HBS 9-507-005)
Bass model group exercise due (To complete this assignment, follow the instructions given in “Bass.doc” in the course folder).
Discussion Questions:
Why was Charles Schwab not doing very well by 2004? (Hint: cover the 3Cs as well Charles Schwab’s marketing strategy.)
How should Charles Schwab revise its STP strategy to rectify the current predicament? Specifically, among the four segments identified in Table B and Exhibit 6, which segment(s) should Schwab target? How should the brand be positioned for the chosen segment(s)?
What do you think of the “Talk to Chuck” test campaign? Using the 6Ms model to evaluate it. Please make sure you include the following issues in your assessment:
Are the test ads primarily promotion-focused or prevention-focused? What do you think of this choice?
Would a national campaign pay off financially? Calculate the Return on Marketing Investment (ROI or ROMI) of the campaign.*
Are there certain aspects of the test campaign you would want to change or improve upon?
Would you as CEO Charles Schwab approve Becky Seager’s request to spend an additional $55 MM on the “Talk to Chuck” campaign?
* Note: Exhibit 11 gives somewhat ambiguous information about the campaign’s payoff. The following clarifies:
“Lift” in Exhibit 11 is the percentage change in the test cities from 2004 to 2005, controlling for the change in the control cities. For example, new accounts from new customers (households) increased 25% (125-100) in the test cities, controlling for change in the control cities.
In order to quantify the ROI, you need absolute numbers, not just percentages. Please utilize the information below in your ROI analysis:
Net New Assets in the Test vs. Control Markets
April-Sept. 2004
Control Cities: $3.22 Billion -
Test Cities: $3.15 Billion
April-Sept. 2005
Control Cities: $3.41 Billion -
Test Cities: $6.65 Billion
(Please see pg. 10 of the syllabus in your course packet for table)
Spreadsheet Assignment: Q 3(b) above.
12. 2/12
Case: Natureview Farm
Natureview Farm
Kotler and Keller, Chapter 15, pp. 410-416, 430-438.
Discussion Questions:
How has Natureview been able to succeed up to February 2000?
What are the financial implications of each proposed growth option? In particular, calculate the incremental sales and profits under each option for the next 1-5 years. To do this, you need to prepare a profit-and-lost statement under each scenario. (Note: Refer to the “Useful Marketing Metrics” memo for how to work with calculations involving channel margins.)
Which of the three growth options would you choose? What are the pros and cons of each?
For your chosen option, how would you minimize the risks associated with it?
Spreadsheet Assignment: Q2 above.
13. 2/18
Overview of the MarkStrat Simulation
Before this class session, you must have:
Registered for MarkStrat online,
Installed the TEAM software,
Read the Student Handbook. The memo “Getting Started with MarkStrat” provides important instructions on (i) and (ii).
14. 2/19
MarkStrat Rounds 1-2
D1 due by class end time.
D2 due by 9 p.m.
15. 2/25
MarkStrat Rounds 3-4
D3 due by class end time.
D4 due by 6 p.m.
16. 2/26
MarkStrat Rounds 5-6
D5 due by class end time.
D6 due by 6 p.m.
17. 3/4
MarkStrat Presentations
(A) MARKSTAT group report due in class (hand in hard copy)
(B) A five-minute in-class PowerPoint presentation (please place in drop folder)
After you receive your final results, you should prepare a paper summarizing your experience and learning. This report is limited to 4 double-spaced pages. To help in preparing this paper, you should keep good records of your strategies and lessons learned throughout the six decision periods. Please cover the following three aspects in the report:
Strategies Pursued: How would you describe your firm’s overall strategies in the two markets? How did you size up your starting position and develop the initial marketing strategy (i.e., targeting, positioning)? How did it evolve over the six years? What marketing management tools covered in the course did you apply?
Analysis of Performance: What is your overall assessment of your performance? In what areas were you able to make improvements? How were your group dynamics?
Key Points Learned: Summarize key success factors in your industry. What have you learned about your competitors and about yourself as a competitor? Do you see any principles of marketing strategy emerging from your experience?
Based on your report, your team should also prepare a 5-minute presentation to share your experiences and learning with the class. In both your report and presentation, do not simply describe what happened during the game but interpret events.
18. 3/5
MarkStrat and Course Wrap-up
(No hand-in.)
(i)Prepare a list of your top 3 takeaways from the course to share in class and (ii)describe how you would apply each to a managerial situation. Your takeaways can be as general as certain principles or conceptual frameworks of marketing management or as specific as a decision-support tool, and your applications can come from previous work experience, current projects as well as observation.
Final Exam:
Open-book, open-notes, three-hour take-home exam
Exam
Available in the course folder by 6:00 p.m. March 6
Return a hard copy of your exam paper to Alison Pearson (Tuck 205I) before noon March 9
03/09/2009
Final Exam Due Today
A hard copy of your exam paper is due to Alison Pearson (Tuck 205I) before noon today, March 9.
