What is marketing?

Before I take this class, marketing to me is PR and outreach. You want to get your message to as many people as you can, so it will increase purchase of product or use of services. However, after I take this class, I have a different view on marketing. Marketing is about providing users a tool, which will help to resolve their problem. Just like other areas in business, marketing plan needs to be aligning with the company’s vision and mission. Utilizing SWOT analysis to perform environmental scanning helps the company to understand the market they are in. By understanding consumer behavior and needs, a company will be in a better position to offer tools which aim to solve customer’s problem. Marketing should be focus on fulfilling customer’s needs and wants, not just selling the product. Effective marketing strategies should be targeted to specific segments, and different communication tools and channels should be use accordingly. One of the communication channels which company should pay attention to is social media. Social media can reach a large group of audience within a short period of time, it can also build communities across physical boundary. Another important thing I learned in this class is positioning, positioning conveys value that the brand provides, and it sets the brand apart from competitors in a sustainable way. Often time, positioning strategy based on lower or discount price may not be sustainable, and it should be consider very carefully before implementation. In term of building long-term relationship with customers, customer loyalty doesn't directly transfer into saving. On the other hand, loyal customer may actually cost more to the company. As a result, company should implement customer lifetime value analysis as part of the marketing plan. To many people, brand is intangible. However, brand equity does have a measurable and tangible value associated with it. Hence, brand value should be listed as asset in financial reports like balance sheet.

Social media

The Franklin D. Schurz Library does utilize social media, in order to reach the faculty, staff and students at IU South Bend. When the social media first getting attention a few years ago, the Library created a presence in MySpace and Facebook. Couple years ago, the Library also establish presence in Twitter. Periodically, the Library post announcement of resources, services and events offer by the Schurz Library. The Library also tries to utilize the pooling feature offered by Facebook to conduct quick pools; however, the response rate is low. The number of people in the Library’s Facebook group is pretty steadily, there are not many new group members or loss of current group members. Even with the PR via social media, the use of library resources and services is going down. Hence, it seems to me that the communication effort is in effective.

After reading the Community Relations 2.0 article, it is clear to me that social media plays an important role in maintaining relationships with the communities. To effectively utilize social media to build relationship with the communities, a dedicated social media team is needed. The social media team will develop a formal social media policy, monitor external and internal online communities, engage online communities, and act as first responders. In term of what types of messages that will work best in social media, I will suggest messages that target to the communities’ interest. The messages should not be just an announcement, but one that will initiative discussions and participations among community members. While social media are popular, there are still people who are neither participating nor inactive in social media. As a result, I don’t foresee social media making other marketing communication forms obsolete in the near future.

Customer Lifetime Value (CLV)

In the organization I work at, an academic library, we do not have knowledge of value of our customers. While we collect different statistics related to resources and services we provide, we rarely look into the statistics in term of cost, we didn’t perform customer break-even analysis either. In the past year, we started to look at cost per use for electronic resources and journals. However, most of the decision for whether to continue a resources or services is based on overall usage. If there is very low usage, we cancel the resources or services. As for whether utilizing CLV could be beneficial to my organization, I’m not too sure as some of the actions need to be taken to implement CLV may not be flexible for us. For example, the mission of our organization is to serve everyone on our campus, it will be difficult for us to identify a segment of users who rarely use our resources and services and firing them. Besides, since we don’t charge for our services explicitly, rewarding customers with discount vouchers or preferential services may not be possible.

Practical issues of implementing CLV includes gathering of data related to customer activities. As mentioned by Ofek, response rate may not be available directly. Also, the firm may not have knowledge of the exact size of each segment they serve. Besides, setting a reasonable expectation at the prospects stage can be challenging. If the firm creates expectations that are exceedingly high, customers may be easily acquired but will not be satisfied or retained. This results in a negative impact on both per-period revenues and survival rates.

Rosewood case

After reviewing the Rosewood Case, I discovered the following issues:

1. Very low awareness of Rosewood brand.
2. Competition in the luxury hotel segment is intense; Rosewood is targeted at sophisticated customers who value the distinctive, exclusive ‘collection’ hotel, while majority of the luxury market seems to value the corporate-branded version of luxury.
3. Low cross-property usage.

Based on the above issues, I recommend management of Rosewood consider the following measures:

1. Increase awareness of Rosewood brand via different channels, see below:

• Advertise in high-end travel magazines like Luxury Travel Magazine
• Promote Rosewood brand and it’s properties via its own TV channel in the guest room
• Advertise in magazines targeted high income households or groups. For example, magazines frequently read by executive.
• Create an online portal which listed all Rosewood properties
• Implement referral program as a way to acquire new customers.

2. Implement Rosewood corporate brand in phrases. The first phrase will be to add Rosewood corporate brand to properties with weak brand; once Rosewood is gaining awareness, ad Rosewood corporate brand to properties with medium brand. Lastly, properties with strong brand will be added to Rosewood corporate brand.
3. Examine customers characteristic and need, as collected by CRS, and refine segmentation strategies.
4. In addition to promoting all Rosewood properties via its own TV channel in the guest room, create a Rosewood quarterly magazine, which highlighted all Rosewood properties and events throughout the year, and have it available in all guest rooms.

I would like to stay at Rosewood Jumby Bay, as I like ocean. I would love to see the sea turtles.

Pricing strategies for Libraries

In Breakthrough Branding: Positioning Your Library to Survive and Thrive, the authors discussed price strategies for libraries. As pointed out by the authors, pricing strategies are perhaps the most critical and most misunderstood and underutilized when it comes to libraries. The common positioning and pricing premise utilized by most libraries is "free" for all. While free may bring customers in the door or to the website,  but it does not mean that they will leave with more than they came for, nor actually use what they take. Also, the precedent of offering something for free sets up barriers to the introduction of more strategic approaches. One example the authors provide is the Columbus Metropolitan Library, their pricing strategies enabled program expansion beyond the library's individual capability. They target a specific market and develop programs in-depth, which leads to partnerships with outside funding agencies. While an example that demonstrate how pricing strategy works in library is great, I would like to learn more on other pricing techniques use by libraries. At the end of the section, the authors also added the 5th "P" - People Strategies. The people strategies call for building relationships with customers as strategic partners, this will enables the library to realize its potential.

Customer loyalty

Before reading The Mismanagement of Customer Loyalty, I shared the viewpoint of many others that the best customers are the loyal ones. Loyal customers should be less price sensitive, and their continuing purchasing behavior will generate profit. But as pointed out in the article, the association between loyalty and profitability was weak to moderate at best. As it can be costly to keep loyal customers, we need to understand the patterns of buying behavior for our customers. By doing so, we can identify which loyal customer to keep, and which one to let go. Two models, RFM and event-history modeling, were discussed. Event-history modeling is based on three simple pieces of information: (1) When did the customer buy for the last time? (2) When did she purchase last? (3) When did she purchase in between? This model is particularly good at predicting how quickly a customer’s purchasing activity will drop off. According to the Choosing a Loyalty Strategy matrix, there are four different segments of customers, they are strangers, butterflies, true friends and barnacles. It is important for marketers to understand the needs of each and treat them accordingly.

In an academic library setting, we view our customers as either strangers or true friends. Customers who never use our resources and/or services are strangers and customers that use our resources and/or services are true friends. As a result, marketing efforts is solely targeted to strangers in order to get them to utilize our resources or services. I think we need to rethink our loyalty strategy.

Brand valuation

After reading Brand Valuation, I think the one thing that makes a brand valuable is its capability to provide long-term competitive advantage. Brands influence the choices of customers, employees, investors, and government authorities, they have an economic impact. According to a study by Interbrand in association with JP Morgan, brands create significant value either as consumer or corporate brands or as a combination of both. On average, one-third of shareholder value. Besides, companies with strong brands outperform the market in respect of several indices. Other than the economic value, brands also create substantial social value by increase competition, improve product performance and the pressure on brand owners to behave in socially responsible ways.

Out of all my favorite brands, I would like to focus on my favorite brands related to food. Below are my favor brands and the reason for each of them:

McDonald’s
I like McDonald’s for several reasons. First, the kids playground. In Hong Kong, none of the MCD have kid playing area, I’m surprised when I come to the US that most MCD have playground. This allow the parent to eat and socialize when their kids play around. Second, they offer collectables with menu from time to time, at least it is the case in Hong Kong. There always a long line waiting for the collectables. Third, Ronald McDonald House Charities is a great cause.

Yoplait
They offer a lot of different choices for their yogurt, you won’t be bore eating yogurt all the time. Besides, their Save Lids to Save Lives program helps people with breast cancer.

Campbell
Campbell soup test good and also offered a lot of variety. I also like their participation in Labels for Education.

Cheetos
While I’m not a cheese lover, I lover Cheetos! I just can’t stop eating them.

Just like all other assets, brands are one of the assets for the company, even though they are intangible. As mentioned above, brands create not only to the company, but also customer and shareholder etc. Companies also find brand valuation helpful in the following ways:

• Making decisions on business investments
• Measuring t he return on brand investments
• Making decisions on brand investments
• Making decision on licensing the brand to subsidiary companies
• Turning the marketing department from a cost center into a profit center by connecting brand investment and brand returns
• Allocating marketing expenditures
• Organizing and optimizing the use of different brands in the business
• Assessing co-branding initiatives
• Deciding the appropriate branding after a merger
• Managing brand migration more successfully
• Establishing brand value scorecards
• Managing a portfolio of brands across a variety of markets
• Communicating where appropriate the economics value creation of the brand to the capital markets in order to support share prices and obtain funding
• Assessing fair transfer prices for the use of brands in subsidiary companies
• Determining brand royalty rates
• Determining the contribution of brands to joint ventures
• Using brands for securitization of debt facilities

Due to the wide range of applications for brand valuation, I think Brands should be on the balance sheet.