Pitch Book Template

OLIN The John M. Olin School Of Business Marketing Career Pitch Book Brand Management Marketing Strategy Marketing Research Overview Brand or product management (the two terms are interchangeable) is an organizational structure that assigns brand managers full responsibility for all matters relevant to their product without giving them authority over other functions such as research & development, manufacturing, and finance. Brand management achieves economies of scale due to functional specialization while making sure that for each product there is someone who carries profit-andloss responsibility. Brand managers have to both develop and implement strategies that aim at increasing sales volume, market share, and profit. Brand managers are jacks-of-all-trades who know about and deal with all issues related to their products including strategy development, new product development, package design, market research, purchasing and manufacturing, pricing and promotions, media and advertising, business forecasting and financials. If you think that brand management is similar to general management, you are right – it is. In fact, brand management might be the best way for young employees to gain strong general management training and experience. As businesses realize the importance of strong brands for sustained performance, brand managers gain in the importance not only at traditional brand management companies such as packaged goods companies but also at financial services, automotive, and high-tech firms. Many general managers have background in brand management and some companies deliberately transfer their most promising employees into marketing department. Lifestyle Brand managers’ working hours are quite reasonable especially compared to investment banking or management consulting. Brand managers work generally around 55 hours a week with a high of 85 during planning season (a threemonth period when product teams develop their plans for the upcoming year) and a low of 45 during the off season. Brand managers travel on average three to four days per month to conduct customer research, attend focus groups, meet with advertising agencies and media, and to help with recruiting. Such events are planned well in advance, so you will not have to worry about canceling your personal plans. OLIN John M. Olin School of Business Overview (cont’d) Most consumer products companies strive to create conditions for a balanced lifestyle, which compensates for lower compensation (when compared to investment banking or consulting). In terms of dress, most places are business casual. Many large companies have in-house cafeterias and health clubs. They tend to be socially responsible, to support volunteer activities, and to match charitable contributions. Brand management offers a very good environment for women. At the brand manager level and below, women and men are probably more or less equally represented. There are fewer women in the upper management positions however. Many companies are family-oriented – they have day-care for kids, allow women to work part-time , and are generally understanding as far as family responsibilities are concerned. Consumer products companies are actively recruiting minorities. The majority is nevertheless mostly white dominated. On the downside, employees complain about the up-or-out policy at some leading brand companies. The pressure to perform and deliver the numbers can be very high. Since so many brand companies are very large, there can be a lot of bureaucracy and red tape. Brand managers might spend more time selling their ideas to senior management as opposed to implementing their strategies. Career track Most MBAs start as assistant brand manager and work in that position for about three years before being promoted to brand manager. Assistant brand managers have less strategic and more operational responsibilities. They interface with other department and make sure that marketing plans are implemented. They analyze marketing research and make recommendations to brand manager. OLIN John M. Olin School of Business Overview (cont’d) Brand managers devise marketing plans, which they have to present to senior management with whose approval they will be implemented. The amount of autonomy brand managers have in strategic decisions varies depending on company, product category, and the comparison between the value of the brand and the value of the company. Larger brands generally provide significant portion of company revenue, are more conservative, and give brand managers less latitude in developing new strategic plans. Smaller brands and the ones competing in a more dynamic environment give brand managers more freedom in setting strategic direction and executing their plans. Brand managers also spend their time training and mentoring assistant brand managers. Brand managers are usually assigned to a particular brand for a period of 1-2 years after which they move to another usually bigger brand. After about three years, brand managers are promoted to category manager. Category managers manage all brands in a particular category (cereal or soda beverages for example). They develop the overall strategy and objectives for the category and coordinate the strategies of specific brands in the category. Category managers also evaluate new product development opportunities and decide how those could find in their category and also their budget. In other words, successful category managers find and develop new business opportunities. OLIN John M. Olin School of Business Overview (cont’d) This page gives an overview of some of the advantages and disadvantages to working in brand management. You should keep this in mind when thinking whether brand management is the right choice for you. Reasons to consider a career in brand management Manage a business and see how your decisions affect sales volume, market share, and profits. Career and leadership development. The strong general management and marketing training you gain can be applied in many other jobs. Brand managers at large consumer products companies are much thought after. Team environment. To make your brand successful you will have to work closely with finance, manufacturing, and R&D. Balanced lifestyle. Reasons to consider a career in marketing strategy Decisions you make directly effect how market is segmented and which customers to target Focus on innovative, new products and services and their development Combines skills from all business disciplines and presents daily new challenges Requires good spatial skills to view perceptual maps, conjoint analysis and interpret where your product fits Devises ways to achieve customer loyalty Things to look out for Position is fairly quantitative in nature and must be support R&D with financial and statistical acumen Most new products are not a success in the marketplace Things to look out for Pressure to perform. Up-or-out policy at some companies. Bureaucracy and red tape. Brand managers spend a significant portion of their time selling their ideas to upper management. Working for a company or a division with a follow the leader strategy. Many times you will not be able to develop your own strategy but will have to execute your predecessor’s or senior management’s one. Several consumers markets have no loyalty to product or service Often consulting for other companies or internal divisions who may be uncooperative OLIN John M. Olin School of Business A day in life of an assistant brand managerSpectrum Brands 7AM •Check voice mail and email for any hot issues •Develop a potential rebate offer with sales for key customer on East Coast •Submit a request to see three different potential versions of rebate from our Marketing Services Group •Fax rough samples to salesman early next week 8AM UPDATE BRAND BUDGET •Process invoices and forward for payment •Refresh promotional spending to account for recent rebate and coupon redemptions •Send email to Group Brand Manager to provide budget status and any potential issues 9AM •Organize media planning folder in preparation for upcoming meeting •Pull updated syndicated data to rank grocery markets based on Category Development and Brand Development OLIN John M. Olin School of Business A day in life of an assistant brand managerSpectrum Brands, Continued 10AM FSI PROGRAM MEETING WITH GROCERY SALES LEAD •Review timing, cost and creative specifications •Request Marketing Services to complete FSI sell sheet materials for Sales Department’s use 11AM •Review and respond to new emails and voice messages •Review Change Management Document for all new or changing products for the brand 12 PM •Grab quick lunch _______________________________________________________ CHANGE MANAGEMENT MEETING OLIN John M. Olin School of Business A day in life of an assistant brand managerSpectrum Brands, Continued 1PM BRAND ANALYSIS PRESENTATION •Analyze shipments, syndicated data, and pointof-sales reports for brand •Present brand status update to Senior Management 2PM FOCUS GROUP PLANNING •Review concept sheets and interview questions 3PM •Discuss new display concepts for Home Centers to creatively merchandise our Household Brands OLIN John M. Olin School of Business A day in life of an assistant brand manager Spectrum Brands, Continued 4PM REVIEW NEW PACKAGING PROOFS 5PM •Contact Aerosol Production Planner to request product samples of 2 new products that have been produced for the first time •Conclude day by cleaning inbox 6PM “Woo, time to go home.” OLIN John M. Olin School of Business A day in the life of a brand manager at Nestle-Purina Based on conversation with Pat Mullen, Olin MBA ’00 on 4/23/03 Working in brand management at Nestle-Purina, I have touched a lot in the last 2.5-3 years in terms of breadth and depth. I have definitely moved around a lot and reported to different people. When you arrive here, you get trained on analytics, basically research trends in brands and categories as well as by city and by retailer. This includes analysis of IRI and Nielsen data on market share, distribution, price, geography. Your role is to try to dissect this information into a picture to see causation. While this seems intensely quantitative, it isn’t-it is more about your ability to see strategic qualitative causation from the numbers. I currently work on local and national level creative efforts (i.e. working with outside agencies on the creative aspects of our pet food brands), as well as working with packaging and r&d-this works to integrate the functions as well as interface with the sales customer group. I must also determine whether our product is worthy of endcap display. Note that you will not work on some of this right away. The Purina Progression Interns or new hires will typically work on the following in the build up: Website Building- Basically you will potentially start working on ensuring that we are building an overall consistent message with our packaging, etc in conjunction with our website. We cannot make false promises on our products, so the web is important to ensure consistency of messages. We currently target through Yahoo and other browsers. Note that the Web is less risky than TV and targets a younger market. OLIN John M. Olin School of Business A day in the life of a brand manager at Nestle-Purina, Continued Packaging- This is an expensive and important element. You will have to determine whether changes are necessary given the legal, regulatory requirements that the product claims are supported. Back to my current experience- I worked exclusively on Purina One brand as we redid the brand completely. This brand has some demographics that need to be catered to. The pet owners who use this brand tend to be very involved and active in their pet’s health. To that end, our website is used to educate these owners about the food, knowledge about pet ownership (TV is too brief to convey all the information we would need to), and use the Web to form online documentation to build credibility with the pet owner, as well as a personality that can be appealed to. Our site campaign often features selective targeting through couponing. Our brand management team, is definitely young and proactive. I typically work from 8-7, however this is dependent on times of the year around budget and other key promotional times. We are very market research and segment oriented here. It is all about having your brand achieve meaning with the target segment. We do this by learning about attributes welcomed by target segment (sometimes through focus groups) and our own analytics through researching the competitive landscape. We look at competitors ads and claims and determine how we need to be positioned in the marketplace. Key other things relevant to working at Nestle-Purina is understanding the annual marketing plans, brand architecture, and active health management information for pet owners. We do utilize Checkmark, our internal ad agency. Advertising is time consuming. OLIN John M. Olin School of Business A day in the life of a brand manager at Nestle-Purina, Continued Back to Purina ONE, our breakthrough technology. We work with R&D to commercialize and discuss the product with focus groups to understand the appropriate marketing mix for this brand. This determines what type of top-line and bottom line financial performance we can come to expect budget wise, as well as how much shelf space we can bargain for, as well as cost of manufacture and distribution. Always remember the legal ramifications of decisions made as well. You do have Profit and Loss responsibility and should have a working knowledge of finance. A financial analyst is assigned to each brand team. Essentially, you have the capacity to make decisions to achieve your budget within certain parameters-almost like an entrepreneur in a larger environment. We have certain targeted sales teams to decide on promotions and work with the distribution channel and share best practices at the group levelwhich is ever increasing in importance with Nestle’s acquisition on Purina, I find myself discussing our best practices with international folks-which was priorly an untapped market with Purina more often to educate on pet care. We target to achieve a lifetime value of the purchaser from the time your pet (for instance a dog) goes from being a puppy to an adult-and then a senior dog. This obviously has a large lifetime value and highlights the adult stage as being our higher margin products. OLIN John M. Olin School of Business A day in life of a marketing summer intern Please refer to the OMA Website for Weekly Summer Journals of 2003 Olin marketing interns at the following URL and companies: http://www.olin.wustl.edu/orgs/oma/ Nestle-Purina-Ted Fouke, Kraft- Brian Herf Anheuser-Busch (Argentina)-Matt Goodwin MasterFoods-Ryan Boyle Toyota-Jeff Meade Intel-David Ferman 3M-Nick Eleftheriou Guidant-Fabian Breland, Greg Holman OLIN John M. Olin School of Business Skills & Talents Great analytical skills are perhaps one of the most important success factors. Brand managers must be able to analyze quantitative and qualitative data to understand consumer needs and be able to devise business strategies. Brand managers are leaders in their organizations. They innovate, take risks, establish strategic direction and then convince others (subordinates, peer brand managers, functional managers, and senior management) to follow their direction. As a brand manager, you will also be asked to train and mentor assistant managers. Since so much work is done in cross-functional teams, good teamwork skills are indispensable. Working with so many people would be impossible without good communication and presentation skills. Enthusiasm for marketing and for understanding consumer behavior. Experience in sales, advertising, or marketing research is helpful although not required. Nevertheless you do need to be familiar with marketing concepts and frameworks especially with 4Ps (Product, Price, Place, and Promotion) and 3Cs (Company, Competition, Customer) as well as Porter’s Five Forces (Internal Rivalry, Supplier Power, Buyer Power, Substitutes and Complements, Barriers to Entry) With so many brands going global, previous international experience, foreign languages, and willingness to travel and work abroad might be a plus if a career in international marketing if what you are looking for. These positions are extremely challenging to get and often involve performing internships abroad on a gratis basis. OLIN John M. Olin School of Business Industry Functions This section outlines how the job function is performed in different industries and sectors. For example, investment bankers work for investment banks and industry; marketing managers work in government, all types of industries, non-profit, etc. For those books that would cover an industry (like life sciences, technology and venture capital), this section would be “Job Functions”, and would cover the different job functions (finance, research, marketing, etc.) available in the industry… what each job is, maybe special requirements (maybe it helps to be an M.D. to be a researcher in the life sciences industry), etc. Please see the following URL to see various industry analysis at Wetfeet.com and note that the WCRC has several resources to perform industry analysis. http://www.wetfeet.com/research/rpp/rppbycareer.asp?careerpk=23&careerName=Marketing OLIN John M. Olin School of Business Facts & Trends Category management Instead of simply selling their products to retailers, large consumer products companies now compete with each to help retailers manage their product categories (e.g. non-alcoholic beverages, cereals, toys). Combining their own data together with retailers’ data, consumer products companies develop category management plans for retailers which include selling their own but also other brands. Although the benefits of category management promise to be great, the are important obstacles in the way such as differences in culture between retailers and brand companies that prevent the two from working together. Consolidation Retailers’ consolidation means that retailers have more power when dealing with packaged goods companies. Better brand management is perhaps the only defense consumer products companies have. As long as consumers know and love their brands, retailers will have to carry them. Brand managers have to work hard to make sure things stay this way. Globalization As companies continue to expand, they face the challenge of finding the right balance between global and local brands. Private Labels As consumers become more accustomed to private brands and more value-conscious, they choose the lower-priced store brand. Brand managers will have to work hard to convince consumers to continue buying higher priced brands. OLIN John M. Olin School of Business Facts & Trends (cont’d) Compensation According to wetfeet.com undergraduates can expect a starting salary of $30-40K with a signing bonus in the $5K range. MBAs generally start between $55 and $75K and receive a signing bonus ranging from $5 to $25K. Typical salaries for product managers are $60 - 120K. Product category managers can make $130K and up. Things to keep in mind: Consumer products companies are under pressure to increase their salaries to become more competitive with other industries, including management consulting. Most large brand companies offer generous bonuses and 401(k) plans. At most companies, both undergraduates and MBAs qualify for stock options programs. Other perks could include product discounts, free magazines, and free tickets to various events. For instance, Anheuser-Busch brand managers typically attend events such as the Super Bowl, as they are the largest advertiser during the big game. However, all that glitters is not gold as these people often have to work through the entire event. OLIN John M. Olin School of Business Getting the Job Recruiting process A round of on-campus interviews or on the spot interviews at trade conferences like NBMBAA,NSHMBA followed by a full day at the company headquarters. If the company does not recruit on your campus, do not get discouraged; you will just have to be more creative and work harder through attending conferences with large corporate presence. Interviews-Before interviews • Conduct informational interviews to learn more about the industry, types of jobs, and companies and to develop your network of contacts. • Utilize the Alumni database and second years to gain internal insights into these companies first hand and interview questions they have asked in the past, as well as their take on corporate culture. • Familiarize yourself with current trends and issues by reading industry magazines and periodicals. • Prepare to give and discuss examples of effective and ineffective marketing campaigns. • Study the shelves at a local grocery store or retail outlet to be able to discuss company products, prices, packaging, shelf positioning, promotions, etc. • Prepare for behavioral interview questions. Practice telling short stories that show your analytical, leadership, teamwork, problem-solving, and creative abilities. Make sure that your leadership stories are not the same as the teamwork ones; have at least three stories for each skill. • Utilize a STAR (Situation, Task, Action, Result) approach to answer such questions clearly and concisely. • Prepare for mini case questions which will test your analytical skills. Think in terms of 4 Ps (Product, Price, Place, and Promotion) and 3 Cs (Competition, Company, and Customer) as well as Porter’s Five Forces. Vault and Wetfeet are good resources. • Expect any conversation to erupt into an interview-students have been asked in the past to discuss how a product should be marketed or key considerations at conferences impromptu through the recruiting company pulling a product from their display. • Be focused-If you are interested in marketing, don’t list three concentrations on your resume. Marketing types at companies such as Frito-Lay tend to discount an interest in both finance and marketing. • Spin your experiences to SELL YOURSELF-You can turn the most quantitative background into a creative one if you focus on the right situation. OLIN John M. Olin School of Business Getting the job (cont’d) During interviews Assuming you have done all of the above, the interview itself should be relatively easy. Here are a few more pointers: • Before answering a question, think what the interviewer really wants to know. If the interviewer asks you whether you could live in city X, she is probably interested not so much in city X but your commitment to the career and the company in the long-term. • Be honest when answering “where else are you interviewing” question. Instead of saying that they are your first choice, indicate your interest in the company by telling what you expect from an employer and how this particularly company matches your expectations. • When asked a wacky question such as “if you were an animal which one would you be?” or “if an M&M could talk, what do you think it would say” remember that there are no right or wrong answers. What the interviewer wants to see is how you act in a stressful situation and whether you have a good sense of humor. • Come prepared with a few company- and industry-specific questions to ask the interviewer. OLIN John M. Olin School of Business ACE The Case-Interview, that is Tips for case interviews: •Have a framework- Do you attack the question with the 4P’s and 3C’s, Porter’s Five Forces or other techniques? •Understand the industry. •Market size and relativity- If you were told that your company’s market share for packing tape decreased from #1 to #2, be able to see if this is significant. •Ask if you can take notes beforehand-This shows you are focused on solving the problem and considers the interviewer as well. •State your assumptions-give the reason behind your results! •Be concise-A brainstorming verbal assault of ideas may produce good thoughts, but doesn’t show your organizational skills or ability to prioritize. •Ask questions-The interviewer will guide you along with information necessary to foster a recommendation. •Remember-The thought process is more important than the answer! •Practice twice a week with your classmates! •NOTE: OMA and OSCA will offer several sessions and corporate speakers for you to get a feel for case interviews and how best to approach them! The Olin Strategy and Consulting Association (OSCA) is a student organization that we partner with that works extensively on strategy related case interview preparation and has several useful tools and presentations on case interviews. Please see the following URL for OSCA’s website and follow to downloads for case interview preparation: http://www.olin.wustl.edu/orgs/osca/ OLIN John M. Olin School of Business Resources Career Information Careers in Marketing by Lila Stair. Marketing & Sales Career Directory published by Bradley Morgan. Vault Reports Guide to Marketing & Brand Management. WetFeet.com Insider Guide to Careers in Brand Management. www.careers-in-marketing.com Magazines and Websites AdCritic.com Advertising Age www.adage.com Adweek www.adweek.com Brandweek www.brandweek.com Journal of American Marketing Association Journal of Consumer Marketing Pro-Q Point of Purchase Times Organizations American Marketing Association www.ama.org Business Marketing Association www.marketing.org Marketing Research Association www.mra-net.org OLIN John M. Olin School of Business Resources (cont’d) Recommended Books Building Strong Brands by David Aaker. Strategic Brand Management by Kevin Keller. Brand Leadership, Aaker and Joachimsthaler. The New Positioning by Jack Trout. Brand Warfare, David D’Alessandro. Marketing Myths That are Killing Business: The Cure to Death Wish Marketing by Kevin Clancy and Robert Schulman Radical Marketing: From Harvard to Harley, Lessons from Ten That Broke the Rules and Made It Big by Sam Hill and Glenn Rifkin. The Fast Forward MBA in Marketing by Dallas Murphy. The Product Managers Handbook by Linda Gorshels. OLIN John M. Olin School of Business Glossary of Key Terms and Definitions Glossary Affinity Program- A marketing effort sponsored by an organization that solicits responses from individuals who share common interests and activities. Attribute- A characteristic of a purchased product that conveys some type of benefit to purchaser BOGO- Industry term for Buy One, Get One Free. A key promotion used in many retail outlets. Brand awareness-Ability to recognize the brand under different circumstances and is related to the strength of the brand node in memory Brand consideration- Is the brand included in the consideration set in its category? Brand credibility- Trustworthiness, likeability and expertise a brand carries. Brand equity- The differential effect that brand knowledge has on the marketing of that brand. Strong brands equate to high inelasticities, making consumers less price sensitive and more willing to try new models. Brand extension- Application of a popular brand name to a new product in an unrelated product category (i.e. Snickers Cruncher or Michelob Ultra) Brand image- Perceptions about the brand as reflected by brand associations. Appeals to intangible consumer aspects such as social and physiological needs Brand identity- How well the tagline, symbols, name, logo, and colors resonate with the end consumer. Brand knowledge- Brand node with a set of associations linked to it Brand preference- How much more your brand is liked than the competition, essentially the result of your brand resonance and how competitively placed substitutes may be. Brand resonance- Ultimate relationship and level of identification customers have with the brand. Involves loyalty, attitudinal attachment, sense of community, active engagement Brand salience- Relates to the quality of awareness for the brand in aided and unaided form. Involves linking the brand name to logos, associations and product awareness and identity. OLIN John M. Olin School of Business Glossary of Key Terms and Definitions, Continued Break-even analysis- Where management estimates how many units of a product would have to sell to break-even with the given price and cost structure. Cannibalization- A loss of sales of a current product due to competition from a new product in the same line . Category Captain- Going beyond a sales leadership role. Essentially, partnering with retail outlets to provide more information on the product to result in higher profits on both the wholesale and retail end of the product category. Category Management- Category management is a process for managing product categories as strategic business units. Category killer- A retailer that combines huge selection and low prices within a single product line. Co-Branding - Partnership between two or more companies to closely link their brand names together for a single product. Concept testing- An initiative to measure consumer attitudes and perceptions of a product idea prior to actual development. Convenience product- A good or service that consumers want to purchase frequently, immediately, and with minimal effort. Cross promotion- A technique in which marketing partners share the cost of a promotional campaign that meets their mutual needs. Customer based segmentation- Dividing a business-to-business market into homogeneous groups based on buyers' product specifications Demographic segmentation- Dividing consumer groups according to characteristics such as sex, age, income, occupation, education, household size, and stage in the family life cycle Elasticity- A measure of the responsiveness of purchasers and suppliers to changes in price Everyday Low Pricing (EDLP)- A pricing strategy of continuously offering low prices rather than relying on shortterm price-cutting tactics such as cents-off coupons, rebates, and special sales Evoked set- Number of brands that a consumer considers buying before making a purchasing decision. Focus Group Interview- Information-gathering procedure in marketing research that typically brings together 8 to 12 individuals to discuss a given subject. OLIN John M. Olin School of Business Glossary of Key Terms and Definitions, Continued Frequency marketing- Frequent buyer or user marketing program that rewards customers who purchase a good or service with cash, rebates, merchandise, or other premiums Lifetime value of a customer- The revenues and intangible benefits (referrals, customer feedback, etc.) that a customer brings to the seller over an average lifetime, less the amount the company must spend to acquire, market to, and service the customer. Line Extension- Introduction of a new product that is closely related to other products in the firm's existing line. Loss Leader- A product offered at a price below cost to attract customers to a store in the hope that they will also buy other merchandise at regular prices. Market segmentation-- Division of the total market into smaller, relatively homogeneous groups. Market share/market growth matrix - A marketing planning tool that classifies a firm's products according to industry growth rates and market shares relative to competing products Marketing audit- A thorough, objective evaluation of an organization's marketing philosophy, goals, policies, tactics, practices, and results. Marketing mix- Blending the four strategy elements of marketing decision making-product, price, distribution, and promotion-to satisfy chosen consumer segments. Marketing myopia- Term coined by Theodore Levitt in his argument that executives in many industries fail to recognize the broad scope of their businesses. (According to Levitt, future growth is endangered when executives lack a marketing orientation.) Opinion leader- Trendsetter likely to purchase new products before others and then share the resulting experiences and opinions via word of mouth. Penetration Pricing Strategy- A pricing strategy involving the use of a relatively low entry price as compared with competing offerings to help secure initial market acceptance. Perception- Meaning that an individual creates by interpreting a stimulus. OLIN John M. Olin School of Business Glossary of Key Terms and Definitions, Continued Points of Parity- A quality that makes you fit into a product category. Enables brand extensions to assimilate with a base brand. For instance, Nivea skin cream stopping odor. Points of Differentiation- What sets you apart from product category in terms of brand performance, imagery, and consumer insight. Brand understands consumer’s problem and is trying to solve it. Point-of-Purchase Advertising- Display or other promotion located near the site of an actual buying decision. Positioning- Marketing strategy that emphasizes serving a specific market segment by achieving a certain position in buyers' minds. Product life cycle- The four basic stages through which a successful product progresses-introduction, growth, maturity, and decline. Pulling Strategy- Promotional effort by a seller to stimulate demand among final users, who will then exert pressure on the distribution channel to carry the good or service, pulling it through the marketing channel. Pushing Strategy- Promotional effort by a seller to members of the marketing channel intended to stimulate personal selling of the good or service, pushing it through the marketing channel. Rack jobber- A full-function merchant wholesaler who markets specialized lines of merchandise to retail stores. Relationship Marketing- Development and maintenance of long-term, cost-effective exchange relationships with individual customers, suppliers, employees, and other partners for mutual benefit. Skimming Pricing Strategy- A pricing strategy involving the use of a high price relative to competitive offerings. Slotting allowance- A fee paid by a manufacturer to a retailer to assure shelf space for its products. Specialty advertising- Sales promotion technique in which marketers distribute articles such as key rings, calendars, and ballpoint pens bearing their firm's name or other advertising message SWOT analysis- A method of studying organizational resources and capabilities to assess the firm's strengths and weaknesses and scanning its external environment to identify opportunities and threats. Target Market- Group of people toward whom a firm markets its goods, services, or ideas with a strategy designed to satisfy their specific needs and preferences OLIN John M. Olin School of Business Glossary of Key Terms and Definitions, Continued Trade allowance- Deal offered to wholesalers and retailers for purchasing or promoting a specific product. Trade discount- A payment to a channel member or buyer as compensation for performing marketing functions; also known as a functional discount. 80/20 principle-Idea that a big percentage of a product's revenues-roughly 80 percent-comes from a relatively small percentage of total customers-around 20 percent OLIN John M. Olin School of Business Resources Company Profiles of key relationships to Washington University’s Olin School of Business Nestle-Purina- The largest brand conglomerate in the world with Headquarters in Switzerland. Nestle recently acquired St. Louis based Purina, the largest maker of pet food and related products. Products range from chocolate bars such as Baby Ruth and Butterfinger to frozen foods such as Stouffer’s French Bread Pizza and Purina’s ONE, Beggin Strips, and Cat Chow. http://www.nestle.com Spectrum Brands- Makers of herbicides, pesticides and outdoor products such as bug sprays and weed killers. Key retail outlet is Home Depot. Cutter (a bug spray) is the company’s core product. http://www.spectrumbrands.com Anheuser-Busch- The world’s largest manufacturer and seller of beer and malt beverage products. Bud Light has surpassed Budweiser in the US in market share, yet Budweiser is the best selling beer in the world with a 3.3 market share. The company has seen a significant increase in market share and international expansion in recent years, including several equity investments and partnerships in countries such as Argentina, China (Tsingtao), etc. Positioning the product is based on the right product, the right image and the situation in which beer is consumed. http://www.anheuser-busch.com 3M- The maker of Post-It Notes and specialty products in adhesives is one of the leading R&D companies in the world. http://www.mmm.com Guidant-Makers of pacemakers and defibrillators which prevent sudden cardiac death. Key challenges remain in the regulatory environment in terms of gaining approval from its numerous MADIT II test results as well as marketing awareness of sudden cardiac death occurrences as well as knowing one’s ejection fraction. Involved in a highly competitive industry with Medtronic, St. Jude, and Johnson & Johnson. One of Fortune’s Top 100 Companies to Work For http://www.guidant.com Maritz-A St. Louis based firm specializing in marketing consulting and primarily loyalty programs, which build awareness and influence consumer behavior. Such programs include credit cards that receive airline miles, discounts towards future purchase of automobiles, etc. http://www.maritz.com/index.asp OLIN John M. Olin School of Business Resources Tools to Analyze Strength and Weaknesses of Brands- Brand Wheels-Essentially from performing surveys, you can gain on what are the most common perceptions of respondents such as reflection of user, benefits of product, etc. Brand Element Options-Rates several factors such as likeability, memorability, protectibility from scale of 1-10 Conjoint Analysis-Enables one to find out consumer preferences to rate feelings from a Lichert scale Perceptual Maps-Analyzes survey respondents opinions of brands with a factor on both the X and Y axis (i.e. price and quality) Spider Charts- Rates the optimal performance of a brand on certain attributes OLIN John M. Olin School of Business