Appendix SONIC MARKETING PLAN AND EXERCISES The Marketing Plan: An Introduction ‘Asa marketer, you'll need a good marketing plan to provide direction and focus for your brand, product, or company. With a detailed plan, any business will be better prepared to launch an in novative new product or increase sales to current customers. Nonprofit organizations also use ‘marketing plans to guide their fund-raising and outreach efforts. Even government agencies put together marketing plans for initiatives such as building public avrarenese of proper nutrition and, stimulating area tourism, The Purpose and Content of a Marketing Plan ‘A marketing plan has a more limited scope than a business plan, which offers a broad overview ‘of the entire organization's mission, objectives, strategy, and resource allocation. The marketing, plan documents hov the organization’ strategic objectives will be achieved through specific imatketing strategies and tactics, with the customer ae the starting point. It is also linked tothe plans of other organizational departments. Suppose a marketing plan calls fr selling 200,000 units annually. The production department mast gear up to make that many unit, finance must arrange funding to cover the expenses, human resources must be ready to hire and train staf and so on. Without the appropriate level of organizational support and resources, no marketing an can succeed Palhough the exact length and layout vary fom company to company, a marketing plan usualy contains the sections described in Chapter 2, Smaller businesses may create shorter of less formal ‘marketing plans, whereas corporations generally require highly structured marketing plans. To {guide implementation effectively, every pat of the plan must be described in considerable detail Sometimes a company will post its marketing plan on an internal Web site so managers and em ployees in diferent locations can consult specific sections and collaborate on additions or changes The Role of Research ‘To develop innovative products, successful strategies, and action programs, marketers need up to-date information about the environment, the competition, and the selected market segments ‘Often, analysis of internal data ie the starting point for assessing the current marketing situa- tion, supplemented by marketing intelligence and research investigating the overall market, the competion, key issues, threats, and opportunites, As the plan is put into effect, matketers we reasure progress toward objectives and to identify areas for improvement if ells fll short of projections. inally; marketing research helps marketers leaen mote about heir customers requirements, expectations, perceptions, satisfaction, and loyally. This deeper understanding provides a foun dation for building competitive advantage through welhinformed segmenting, targeting, and positioning decisions. Thus, the marketing plan should outline what marketing reseatch wil be ‘conducted snd when, a well a how; the finding wil be applied The Role of Relationships ‘Although the marketing plan shows how the company will establish and maintain profitable ‘customer relationships, it also affects both internal and external relationships, Fist, t influences hhov marketing personnel work with each other and with other departments to deliver value and satisly customers. Second, it affects how the company works with suppliers, distributors, and partners to achieve the plans objectives. Third, it influences the company’s dealings with other stakeholders, including government regulators, the media, and the community at large. All these relationships are important to the organization’ success and must be considered when developing a marketing plan atThis section summarizes market ‘opportunites, marketing strategy, land marketing and financial objec- tives for sonior managers who wil read and approve the marketing plan ‘The situation analysis describes the market, the company’s eapabilty to serve targeted segments, and the competition. Market summary includes size, needs, growth, and trends. Dox serbing the targeted segments In detal provides context for ‘marketing strategies and programs discussed later inthe plan AZ Appendix From Marketing Plan to Marketing Action Most companies create yearly marketing plans, though some plans cover a longer period ‘Marketers start planning well in advance ofthe implementation date to allow time for marketing research, analysis, management review, and coordination between departments. Then, after each action program begins, marketers monitor ongoing results, investigate any deviation from the projected oulcome, and lake corrective steps as needed. Some marketers also prepare contingency plans for implementation if certain conditions emerge. Because of inevitable and sometimes Unpredictable envizonmental changes, marketers must be ready to update and adapt marketing plane at any time. For effective implementation and control, the marketing plan should define how progress ward objectives will be measured. Managers typically use budgets, schedules, and marketing met rics for monitoring and evaluating resulls. With budgets, they can compare planned expenditures with actual expenditures for a given period, Schedules allow management to sce when tacks were supposed to be completed and when they were actually completed. Marketing metres track the actual outcomes of marketing programs to tee whether the company is moving forward toward its objectives. Sample Marketing Plan for Sonic This section takes you inside the sample marketing plan for Sonic, a hypothetical start-up com- pany. The company’s first product is the Sonic 1000, a state-of-the-art, fully loaded multimedia mart phone. Sonic will be competing with Apple, Samsung, LG, Motorola, HTC, and other well-established rivals in a crowded, fast-changing marketplace where smart phones have many communication and entertainment capabilities. The annotations explain more about what each section ofthe plan should contain, 1.0 Executive Summary Sonic is preparing to launch a major nev state-of the-art mulkimedia smart phone, the Sonic 1000, in & mature market, We can effectively compete with many types of smart phones because out product offers unique combination of advanced features and functional at avery compet- itive value-added price, We ae targeting specific segments in the consumer and business markets, taking advantage ofthe growing intrest ina single powerful bu affordable device wi communication, organization, nd entertainment benefits ‘The primary matketing objective is to achieve first-year US. marke share of | percent with unit sales of 800,000. The primary financial objectives ae to achive first-year sles revenues of $200 tllion, kep first-year loses to less than $40 million, and breakeven eatly inthe second yet. extensive 2.0 Situation Analysis Sonic, founded 18 months ago by two well-known entrepreneurs with telecommunications expe rience, it about to enter the highly competitive smarl-phone markel. Multifunction cell phones are increasingly popular for both personal and professional use, with more than 968 million smart phones sold worldwide in 2013, Competition is increasingly intense even as technology evolves, industry consolidation continues, and pricing pressures squeeze profitability. To gsin market share in this dynamic environment, Sonic must carefully target specific segments with ‘valued features and plan for a next-generation product to keep brand momentum going, 2.1 MARKET SUMMARY Sonic: market consists of consumers and business users who prefer to use a powerful but affordable single device for fully functional communication, information storage and exchange, organization, and entertainment on the go. Specific segments being targeted daring the first year include professionals, corporations, students, entrepreneurs, and medical users, Exhibit A.1 shows how the Sonic 1000 addzestes some of the most basic nceds of targeted consumer and business segments in a cost-effective manner, The additional communication and entertainment benefits of the product just enhance its appeal to those segments,| Exh, A1| Needs and Corresponding Features/Benefits of Sonic Smart Phone Proteins Stayin touch wile onthe go ‘a Wroles ena o convenient send and roceve messages tom (conser marke) nye; cl phone cnet for vie communication fom anywhere Recor infomation whi onthe go 1 Voce eeognion fr ao-hans ecardag Studer sm Perarm mary tection witout aryig "= Compate with numerous aplication and periheral for (consumer mately utte oager convenient cost-atestv unconalty Brest and inal ‘Care wardabe a ifarent colors ad pate lw ues to ak a aston stalement Corporat sees 1 Inputan acces etal dataon he go ‘Compatible wih widely avaiable stare (uusiness marie se for rotary tas Customizable ot diverse copa tasks and eto Eopreneute Organize ans aca contacts, schedule Wren, witless aces to calendar and acees bok esl (business marke) cetals heck appointments and connect wih contacts Medical sere 1 Uptste,acess and ecnange medal ‘ Noshans, witless recording ad xchange of intoaton a (business marke reco reduce paperwork and inereatepotucity Smart-phone purchasers cin choose between models based on several different operating systems. The biggest selling smart-phone operating system is Android. Androids smaller rival in ‘clude BlackBerry OS, iOS, and the Windows Phone OS, Storage capacity (hard drive or lash drive) isan expected feature, so Sonic is equipping its frst product with an ultza-fast 64 gigabyte drive that can be supplemented by extra storage. Technology costs are decreasing even as capabilities are inereasing, which makes value-priced models more appealing to consumers and to business users with older smart phones who want to trade up to new, high-end multifunction units 2.2 STRENGTHS, WEAKNESSES, OPPORTUNITIES,AND THREAT ANALYSIS Sonic thas several powerful strengths on which to build, but our major weakness is lack of brand aware- ‘ness and image. The major opportunity is demand for mulufunction communication, organiza- tion, and entertainment devices that deliver a number of valued benefits at a lower cost. We also face the threat of ever-higher competition and downward pricing pressure. Strengths Sonic con build on three important strengths: 1, Innovative prodtct—The Sonic 1000 olfers a combination of features that are hard to find 1m single devices, with extensive telecommunicatione capabilities and highest-quality digital ‘video/musicTV program storage/playback, 2, SecurityOur smart phone uses a Linux-bated operating system that is less vulnerable to hackers and other security threats that can result in stolen or corrupted data. 3. Pricing—Our product is priced lower than competing smart phones—none of which offer the same bundle of features—which gives us an edge with price-conscious customers, Weaknesses By waiting to enter the smartphone market entil considerable consolidation ‘of competitors has occurred, Sonic has learned from the successes and mistakes of others. "Nonetheless, we have two main weaknesses: A. Lack of brand awareness—Sonic has no established brand or image, whereas Samsung, Apple, ‘Motorola, and others have strong brand recognition. We will addrese this issue with aggressive promotion, 2, Heavier and thicker unst—The Sonic 1000 is slightly heavier and thicker than most compet- ing models because it incorporates so many telecommunication and multimedia features, To counteract this weakness, we will emphasize our product’ benefits and value-added pricing ‘wo compelling competitive strengths Strengths are internal capabilities ‘that can help the company reach Its objectives. ‘Weaknesses are internal elo= ments that may interfere wth the ‘company’s abilly to achieve its objectives. Appendix ASOpportunities are areas of buyer need or potential interest in which the company might perform profit- ably Thats are challenges posed by an unfavorable rend or development that could lead to lower sales and profs, This section identifies key competitors, describes their ‘market positions, and provides an overview oftheir strategies. ‘This section summarizes the main features of the company's various products. AA Appendix Opportunities Sonic can take advantage of two major market opportunites: A. Increasing demand for state-of-the-art multimedia devices with a fall array of communication “furctions—The market for euttng-edge multimedia, multifunction device is growing rapidly. ‘Smart phones are alzeady commonplace in public, work, and educational settings in fact, us ‘rs who bought entry-level models are now trading up 2. Loner technology costs—Better technology is now available at a lower cost than ever before ‘Thus, Sonic can incorporate advanced features ata value-added price that allows for reason: able profit, ‘Threats We face three main threats at the introduction of the Sonic 1000: Increased compettion—More companies are offering devices with some but not all ofthe fea- ‘ures and benefits provided by the Sonic 1000. Therefore, Sonic's marketing communications must stress our clear differentiation and value-added pricing 2. Downward pressure on pricing—Increased competition and marketshare strategies are push: ing smart-phone prices down. Sill, our objective of breaking even with second-year sales of the original model is realistic, given the lower margins in the smart-phone market 3. Compressed product life cycleSmart phones are reaching the maturity stage of thei life cycle ‘more quickly than easlie technology products, Because of this compressed lifecycle, we plan, to introduce an even greater-enhanced media-oriented second product during the year fol- lowing the Sonic 1000's launch, 2.3 COMPETITION The emergence of well-designed multifunction smart phones, including the Apple iPhone, has increased competitive pressure. Competitors ate continually adding features and sharpening price points, Key competitors: + Apple: The leader in smart-phone market share, Apple takes pride in being forward thinking, innovative, and consumer centric, Its latest iPhone 5s features an impressively thin and light ‘weight metallic design, ingerprint identity sensor, dual LED flash, and CPU power up to two ‘mes faster than the previous generation, + Samsung: A strong competitor in the smart phone industry, Samsung ranks as atop 10 global brand and has plans to reach $400 billion in revenue by 2020. The Galaxy SS features a whop- ping 16-megapixel camera and the first-ever built-in heart rate monitor, + LG: Founded in 1958, LG Electronics strives to be a worldwide leader in the digital market and in 2014 ranked third in total emart-phone subscribers, behind Apple and Saméung. Its G2 smart phone features a large 52-inch full HD IPS display and ergonomically positioned rear key control on the back. + Motorola: Motorola pioneered the mobile communications industry and invented the frst ‘mobile phone in 1973. Today, the company prides itself on creating value with comfortable, approachable, and pawerful devices. The Moto X is first smart phone to be designed, engi neeted, and assembled entirely in the United States, + HTC: Founded in 1997, HTC ie relatively new competitor tothe industry but sll ranks filth in smart-phone matket share. HTC built its reputation on providing high-quality products that garnered recommendations and referrals from both retailers and consumers. ts HTC (One (M8) smart phone comes witha 5.0-inch full HD 1080p display and is curved to fit in the palm ofthe hand, Despite strong competition, Sonic can carve out a definitive image and gain recognition among targeted segments, Our appealing combination of state-of-the-art features and lov price is critical point of differentiation for competitive advantage, Our second product will be even more rmedia-oriented to appeal to segments where we will have strong brand recognition, Exhibit A2 shows a sample of competitive products and prices 24 PRODUCT OFFERINGS ‘The Sonic 1000 offers the following standard features: + Voice recognition for bands free operation, + Fullarray of apps + Complete organization functions, including linked calendar, address book, synchronization| Exh. A2| Selected Smart-Phone Products and Pricing Buln Storage 64GB 3268, micoSDup 3268 w6e8 3268, miro SD up ime wo12808 Display 4'PSLCD 1" SuperAMOLED —S2"1PSLCD 47" AMOLED —S0"IPSLED camera some 16MP sap owe 4p Price $599.98 si9g.98 $0999 sa0999 $199.98 Digital music/videoitelevision recording, witeless downloading, and instant playback Wireless Web and e-mail, text messaging. instant messaging Four-inch high-quality color touch screen ‘Ulta fast 64 gigabyte drive and expansion slots + Integrated 12-megapixel camera with ash and photo editing/sharing tools First year sales revenues are projected to be $200 million, based on sales of 800,000 of the Sonic 1000 model at a wholesale price of $250 each. Our second-year product will be the Sonic ‘All Media 2000, stressing enhanced multimedia communication, networking, and entertainment functions, The Sonic All Media 2000 will include Sonic 1000 features plus additional features such as + Built-in media beaming to share musi, video, and television files with other devices video Web sites + Webcam for instant video capture and uploading to popu + Voice-command access to popular social networking Web sites 2.5 DISTRIBUTION Sonic branded products will be distributed through a network of retailers in the op 50 US, markets. Among the most important channel partners being contacted ate Office supply superstores, Office Depot and Staples wal cary Sonic products in stores in taulogy and online «Computer stores, tndepndent compute tes wl ery Sonic products {Hectic specialty sores Bes Buy wl etre Sonic smartphones ins sores onlin and ints med soverting «Online raters. Anazon.coo il cts Sonic ar poe andr a promotinl owill five Sone prominent placement on teomepage urn he inrodtion. Distribution will initially be restricted to the United States, with appropriate sales promotion support. Later, we plan to expand into Canada and beyond. 3.0 Marketing Strategy 3.1 OBJECTIVES We have set aggressive but achievable objectives for the first and second years ‘of market entry. + First-Year Objectives. We ate aiming for a 1 percent shate of the US, smart phone market through unit sales volume of 800,000 + Second-Year Objectives. Our second 1000 and launch our second model. sar objective is to achieve break-even on the Sonic 3.2 TARGET MARKETS Sonic’ strategy is based on a positioning of product differentiation, ‘Our primary consumer target for the Sonic 1000 is middle- to upper-income professionals who need one fully loaded device to coordinate their busy schedules, stay in touch with family and. Distribution explains each channel for the company’s products and mentions new developments and trends. Objectives should be defined in specific terms so management can measure progress and take correc tive action to stay ontrack. All marketing strategies start with segmentation, targeting, and pos tioning Appendix ABPositioning identities the brand, benefits, poins-of-itference, and points-of-panty for the product or Tine. Product strategy includes deci sions about product mix and lines, brands, packaging and labeling, and warranties Pricing strategy covers decisions about seting intial prices anc Adapting prices in response to ‘opportunites and competitive chal- lenges. Distribution strategy includes s ction and management of chan- pel relationships to deliver value to eustomers. “Marketing communications strategy covers all efforts to com- ‘municate to target audiences and channel members ‘The marketing mix includes tactios and programs that support prod= uct, pricing, distribution, and mar- keting communications strategy. AS Appendix colleagues, and be entertained on the go. Our secondary consumer target is high school, college, and graduate students who want a multimedia, dual-mode device, This segment can be described demographically by age (16-30) and education status. Our Sonic All Media 2000 will be aimed at eens and twentyzomethings who want a device with features (o support social networking and heavier, more extensive entertainment media consumption, The primary business target for the Sonic 1000 is mid. to large-sized corporations that want to help their managers and employees stayin touch and inptt or access critical data when out of the office. This segment consists of companies with more than $25 million in annual sales and more than 100 employees, A secondary target ie entrepreneurs and small business owners. Also we will target medical users who want to update or access patients’ medical recorde, Each of the matketing-mix strategies conveys Sonic’ differentiation to these target market segments 3.3 POSITIONING Using product differentiation, we are positioning the Sonic smart phone as the most versatile, convenient, value-added model for personal and professional use. Our market ing wil focus on the value-priced multiple communication, entertainment, and information capa- bilities differentiating the Sonic 1000. 3.4 STRATEGIES Product ‘The Sonic 1000, including all the features described inthe earlier Product Offerings sec tion and more, will be sold with a one-year warranty. We will introduce the Sonic All Meda 2000 daring the following year, after we have established our Sonic brand. The brand and logo (Sonic's distinctive yellow thunderbolt) will be displayed on our products and packaging as well as in all marketing campaigns. Pricing ‘The Sonic 1000 willbe introduced at a $250 wholesale price and a $300 estimated retail price per unit. We expect to lower the price of this model when we expand the product line by launching the Sonic All Media 2000, to be priced at $350 wholesale per unit. These prices re flect a strategy of (1) attracting desirable channel partners and (2) taking share from established competitors Distribution Our channel strategy isto use selective distribution, marketing Sonic smart phones trough well-known stoves and online retailers. During the first yea, we will add channel part ners until we have coverage in all major US. markets and the product is included in the major electronics catalogs and Web sites. We will also investigate distribution through cell-phone outlets ‘maintained by major carriers such as Verizon Witeless. In support of channel partners, we will ro: vide demonstration products, detailed specification handouts, and full-color photos and displays featuring the product. Finelly, we plan to arrange special payment terms for retailers that place ‘volume orders, Marketing Communications By integrating all messages in all media, we will reinforce the brand name and the main points of product differentiation, Research about media consumption patterns will help our advertising agency choose appropriate media and timing to reach prospects before and during product introduction. Thereafter, advertising will appear on a pulsing basis to maintain brand awareness and communicate various differentiation messages. The agency will also coordinate public relations efforts to build the Sonic brand and support the differentiation ressage, To generate buzz, ve will host a user-generated video contest on our Web site. To attract, retain, and motivate channel partners for a push steategy, we will use trade sales promotions and personal selling. Until the Sonic brand has been ettablished, our communications will encourage parchases through channel pariners rather than from our Web site 3.5 MARKETING MIX The Sonic 1000 willbe introduced in February. Here are summaries of action programs we will use during the first six months to achieve our stated objectives + January. We will launch a $200,000 trade sales promotion campaign and participate in major industry trade shows to educate dealers and generate channel support forthe prod. uct launch in February. Alzo, we will create buzz by providing samples to selected product reviewers, opinion leaders, influential bloggers, and celebrities. Our training staff will workwith retail sales personnel at major chains to explain the Sonic 1000' features, benefits, and advantages. + February, We will start an integrated print/radio/Internetisocial media campaign targeting professionals and consumers, The campaign will show how many functions the Sonte smart phone can perform and emphasize the convenience of a single, powerful handheld device. Tis multimedia campaign will be supported by point-of-sale signage as well as online-only ads and video tours + March, As the multimedia advertising campaign continues, we will add consumer sles pro ‘motions such asa contest in which consumers post videos to our Web sit, showing how they use the Sonic in creative and unusual ways, We will also distribute new point-of purchase duplays to support our retailers + April. We will hold a trade sales contest offering prizes for the salesperson and retail organi zation that sell the most Sonie smat phones during the four-week period, + May. We plan to roll out 2 new national advertising campaign this month. The radio ads will feature celebrity voices telling their Sonic smart phones to perform functions sch as initia ing a phone call, sending an e-mail, playing a song or video, and so on, The stylized print and cline ads wil feature avatars of these celebrities holding their Sonic mart phones. We plan, to repeat this theme for next year's produc launch, + June, Oue radio campaign will add a new voice-over tagline promoting the Sonic 1000 as a graduation gifl. We will exhibit a the semiannual electronics trade show and provide retail: ere with new competitive comparison handouts as a sales aid. In addition, we will analyze the results of customer satisfaction research for use in future campaigns and product development efforts, 3.6 MARKETING RESEARCH Using research, we will identify specific features and benefits ‘our target market segments value. Feedback from marker tests, surveys, and focus groups will help us develop and fine-tune the Sonic All Media 2000, We ate also measuring and analyzing custom: ‘ers attitudes toward competing brands and products, Brand awareness research will help us de termine the effectiveness and efficiency of our messages and media, Finally, we will use customer satisfaction studies to gouge market reaction. 4.0 Financials ‘Total first-year sales revenue for the Sonic 1000 is projected at $200 mullion, with an average wholesale price of $250 per unit and variable cost per unit of $150 far unit sales volume of 100,000, We anticipate a first-year logs of as much as $40 million, Break-even calculations indi- ‘ate thatthe Sonic 1000 will become profitable after the sales volume exceeds 267,500 during the product’ second year. Our break-even analysis acsumes per-unit wholesale revenue of $250 per unit, variable cost of $150 per unit and estimated first-year fixed costs of $26,750,000. With these assumptions the break-even calculation is 26,750,000, 28 750.000 367 500 units 3250 — $150 5.0 Controls Controls are being established to cover implementation and the organization of our marketing activities 5.1 IMPLEMENTATION We aze planning tight control measures to closely monitor quality and customer service satisfaction, This will enable us to react very quickly in correcting any prob lems that may occus, Other early warning signals that will be monitored for signs of deviation from, the plan include monthly sales (by segment and channel) and monthly expenses, 5.2 MARKETING ORGANIZATION Sonics chief marketing offices, Jane Melody, holds ‘overall responsibility forall of the companys marketing activities. Exhibit A.3 shows the struc tore ofthe eight-person marketing organization, Sonic has hired Worldwide Marketing to handle national sales campaigns, digital, trade and consumer sales promotions, and public rations effort. Programs should coordinate with the resources and activities of ther departments that contribute te customer value for each product. ‘This section shows how marketing research will support the develop ‘ment, implementation, and evalu ation of marketing strategies and programs. Financials include budgets and forecasts to plan for marketing expenditures, scheduling, and ‘operations. Controls help management measure results and identity any problems or performance variations that need corrective action, ‘The marketing department may be organized by function, as in this sample, orby geography, product, ‘or some combination of, Appendix AT[Exh. A3| Sonic's Marketing Organization Sonic Marketing Plan Chapter Assignments Chapter 2: Developing Marketing Strategies and Plans ‘As an assistant to Jane Melody, Sonie's chief marketing officer, you've been assigned to draft a mission statement for top managements review." This should cover the competitive spheres within which the finm will operate and your recommendation of an appropriate generic com petitive strategy. Using your knowledge of marketing, the information you have about Sonic, and library or Internet resources, answer the following questions + What should Sonic's mission be? + In what competitive spheres (industry, products and applications, competence, market- segment, vertical and geographic) should Sonic operate? + Which of Porters generic competitive strategies would you recommend Sonic follow in for- ‘mulating overall strategy? ‘As your instructor directs, enter your answers and supporting information in a writen market- ing plan to document your ideas Chapter 3: Collecting Information and Forecasting Demand Jane Melody asks you to scan Sonic’ external environment for early warning signals of new op portunities and emerging threats that could affect the succese of the Sonic 1000 smart phone. Using Internet or library sources (or both), locate information to answer three questions about key areas of the macroenvironment. + What demogeaphic changes are likely to affect Sonics targeted segments? + What econome trends might influence buyer behavior in Sonic's targeted segments? + How might the rapid pace of technological change alter Sonic’ competitive situation? Enler your answers about Sonic’ environment in the appropriate sections of a written market ing plan to record your comments AS AppendixChapter 4: Conducting Market Research ‘Your next task is to consider how matketing research can help Sonic suppor its marketing strat «egy, Jane Melody also asks you how Sonic ean measure results after the marketing plan is imple rented, She wants you to answer the following tree questions. ral data, or experiments will onic need to 1 questions oF issues that Sonic needs to + What surveys, focus groups, observation, behavie support its marketing strategy? Be specific ab resolve using marketing research, + Where can you find suitable secondary data about total demand for emart phones over the next two yeare? Identify at least two sources (online or offline), describe what you plan to draw from each source, and indicate how the data would be useful for Sonics marketing planning. + Recommend three specific marketing metrics for Sonic to apply in determining marketing ef {ectivencss and efficiency. “Enter this information in the matketing plan youlve been writing to document your responses, Chapter 5: Creating Long-Term Loyalty Relationships Sonic has decided to focus on (otal customer satisfaction as a way of encouraging brand loyalty in 4 highly competitive marketplace, With this in mind, you've been assigned to analyze three spe cific issues as you continue working on Sonics marketing plan. + How (and how often) should Sonic monitor customer satisfaction? + Would you recommend that Sonic use the Net Promoter method? Explain your reasoning + Which customer touch points should Sonic pay particularly close attention to, and why? ‘Consider your answers in the context of Sonic's current situation and the objectives it has set "Then enter your latest decisions in the written marketing plan, Chapter 6: Analyzing Consumer Markets Youle responsible for researching and analyzing the consumer mazket for Sonic’ emart-phone product, Look again at the data you've already entered about the company’s current situation and ‘macroenvizonment, especially the market being targeted. Now answer these questions about the market and buyer behavior. + What cultura, social, and personal factors are Likely to mos of smart phones? What research tools would help you bett attitudes and behavior? + Which aspects of consumer behavior should Sonics marketing plan emphasize, and why? + What markeling activities chould Sonic plan to coincide with each stage of the consumer buy. ing process? influence consumer purchasing tuaderetand the effect on buyer After you've analyzed these aspects of consumer behavior, consider the implications for Sonic's marketing efforts to support the launch of ts smart phone. Finally, document your findings and ‘conclusions in the written marketing plan. Chapter 7: Analyzing Business Markets You've been learning more about the business market for Sonics smart phone. Jane Melody has defined this market ae mid-to large-sized corporations that want their employees to stayin touch and be able to input or access data from any location, Respond to the following three questions based on your knowledge of Sonic's current situation nd busines-to-businest marketing + What types of businesses appear to fit Melody’s market definition? How can you research the number of employees and find other data about these types of businesses? + What type of purchase would a Sonic smart phone represent for these businesses? Who would participate in and influence ths typeof purchase? + Would demand for smart phones among corporate buyers tend to be inelastic? What aze the ‘implications for Sonic’ marketing plan? Appendix roato ‘Your answers to these questions will affect how Sonic plans marketing activities for the business segments to be targeted. Take a few minutes to note your ideas inthe written marketing plan. Chapter 8: Tapping into Global Markets [As Jane Mclody’sasitant, you't researching how to market the Sonic 1000 smast-phone product otaide the United States within a year. You've been asked to answer the following questions about Sonic's use of global marketing + Asastart-up company, should Sonic use indirect or direct exporting, licensing, joint ventures, ‘or dizect investment to enter the Canadian market next year? To enter other markets? Explain, your answers. + Sonic starts marketing its smart phone in other countries, which of the international prod- ‘uct strategies is most appropriate? Why? + Although some components are made in Asia, Sonie's smart phones will be assembled in ‘Mexico through a contractual arrangement with a local factory. How are country-of-origin, perceptions likely to affect your marketing recommendations? Think about how these global marketing issues fit into Sonic's overall marketing strategy: Now document your ideas in the marketing plan you've been writing Chapter 9: Identifying Market Segments and Targets Identifying suitable market segments and selecting targets are critical to the suecess of any mar. ‘keting plan. Az Jane Melody’s assistant, you're responsible for market segmentation and targeting. Look back at the market information, buyer behavior data, and competitive details you previously gathered as you answer the following questions + Which variables should Sonic use to segment its consumer and business markets? + How can Sonic evaluate the attractiveness of each identified segment? Should Sonic market to one consumer segment and one business segment or target more than one in each market? Why? + Should Sonie pursue full-market coverage, market specialization, product specialization, se lective specialization, or single-segment concentration? Why? Next, consider how your decisions about segmentation and targeting will aflect Sonics market ing efforts. Depending on your instructor’ directions, summarize your conclusions in the written marketing plan, Chapter 10: Crafting the Brand Positioning As belore, youre working with Jane Melody on Sonie's marketing plan for launching a new smart phone, Nov you're focusing on Sonic brand positioning by answering three specific questions + Ima sentence or two, what san appropriate brand positioning for the Sonic 1000 smart phone? + Create a perceptual map to diagram points-of parity and pointsof difference between Sonic and ils competitors. Are there any opportunities based on your findings? + How can Sonic ereate differentiation from competitors using emotional branding? Document your ideas in the written marketing plan, Note any additional research you may need to determine how to proceed after the Sonic 1000 has been launched, Chapter 11: Creating Brand Equity Sonic is « new brand with no prior brand associations, which presents a number of market opportunities and challenges. Jane Melody has given you responsibilty for making recommenda- tions about three brand equity issues that are important to Sonics marketing pian+ What brand elements would be most useful for differentiating the Sonic brand from compet ing brands? + How can Sonic sum up its brand promise for the new smart phone? + Should Sonic add a brand for its second product or retain the Sonic name? ‘Be sure your brand ideas ate appropriate in light of what you've learned about your targeted segments and the competition, Then add this information to your written marketing plan, Chapter 12: Addressing Competition and Driving Growth Knowing thatthe smart-phone market is likely to remain highly competitive, Jane Melody wants you to look ahead at how Sonic ean develop new products outside the smart-phone market. Review the competitive situation and the matket situation before you continue working on the Sonic marketing plan, + List three new-product ideas that build on Sonic strengths and the needs ofits various target segments. What criteria should Sonic use to screen these ideas? + Develop the most promising idea into a product concept, and explain how Sonic can test this concept. What particular dimensions must be tested? + Assume that the most promising idea test well. Now develop a marketing strategy for intro acing it, including a description ofthe target market; the product positioning; the estimated, sales, profit, and market share goals for the first year; your channel strategy; and the mar keting budget you will recommend for this nev-product introduction, If possible, estimate Sonic’ costs and conduct a break-even analysis, Document all the details of your new-product development ideas in the written marketing plan, Chapter 13: Setting Product Strategy Introducing a new product entails a variety of decisions about product strategy, including differ- ‘entiation, ingredient branding, packaging, labeling, warranty, and guarantee, Your next task isto answer the following questions aboust Sonic's product strategy. + Which spect of product ferentiation would be most akable inset Sonic pat from ts compeiors and wy? «Should Soni se ingredient branding to tout the Linxbased operating system that ays rakes its rmat phone mote secure than start phones based on some other operting «Hy ean Sonic use packaging and bling to support its brand image an help its channel partners sl the smart phone product mote elec? ‘Once you've answered these questions, incorporate your ideas into the marketing plan youve been writing. Chapter 14: Designing and Managing Services ‘Youre planning customer support services for Sonic's new smart-phone product, Review what yo know about your taget market and its aceds; also think about what Sonics competitors are ‘offering. Then respond to these three questions about designing and managing services, + What support services are buyers of smart-phone products likely to want and need? + How can Sonic manage gaps between perceived service and expected service to satisly customers? + What postsale service arrangements must Sonic make, and how would you expect thete to af fect eastomer satisfaction? Consider hovr your service strategy will support Sonics overall marketing efforts, Summarize ‘your recommendations in the written marketing plan to document your ideas. Appendix anana Chapter 15: Introducing New Market Offerings Sonic isa new entrant in an established industry characterized by competitors with relatively high brand identity and strong market positions. Use research and your knowledge of how to deal with competitors to consider three issues that will affect the company’s ability to successfully introduce is first product + What factors will you use to determine Sonic's strategic group? + Should Sonic select a class of competitor to attack on the basis of strength versus weakness, closeness versus distance, or good versus bad? Why is this appropriate in the smart-phone market? + Asastartup company, what competitive strategy would be most effective as Sonic introduces ite first product? ‘Take time to analyze how Sonic competitive strategy will aflect ts marketing strategy and tac tics. Now summarize your ideas in the written marketing plan, Chapter 16: Developing Pricing Strategies and Programs Youie in charge of pricing Sonic's product frit nunch eat next year: Review the SWOT analy- sis you previously prepared as well as Sonic’ competitive environment, targeting strategy, and product positioning. Now continue working on your marketing plan by responding (othe follow. ing questions + What should Sonic's primary pricing objective be? Explain your reasoning + Are smart-phone customers likely to be price sensitivet What are the implications for your pricing decisions? + What price adaptations (such as discounts, allowances, and promotional pricing) should Sonic include in ts marketing plan’ “Make notes about your answers to these questions and then document the information in the seritten marketing plan, Chapter 17: Designing and Managing Integrated Marketing Channels At Sonic, you have been asked to develop a marketing channel system for the new Sonic 1000 imart phone. Based on what you know about designing and managing integrated marketing channels, nawer the three questions that follow. + Do you agree with Jane Melody’: decision to use « push strategy for the new product? Explsin Your reasoning. + How many channel levels are appropriate for Sonics targeted consumer and business segments? + Inddetermining the number of channel members, should you use exclusive, selective, or inten sive distribution? Why? Be sure your marketing channel ideas support the product positioning and are consistent with the goals that have been set. Record your recommendations in the written marketing phan, Chapter 18: Managing Retailing, Wholesaling, and Logistics Al this point, you need to make more specific decisions about managing the marketing inlerme- Giaries for Sonic's first product. Formulate your ideas by answering the following questions + What types of retailers would be most appropriate for distributing Sonics smart phone? What are the advantages and disadvantages of selling through these types of retailers?+ What role should wholesalers play in Sonic's distribution strategy? Why? + What market-logistics issues must Sonic consider for the launch of its first mart phone? Summarize your decisions about retailing, wholesaling, and logistics in the marketing plan you've been writing, Chapter 19: Designing and Managing Integrated Marketing Communications Jane Melody has assigned you to plan integrated marketing communications for Sonic's new: product introduction. Review the data, decisions, and strategies you previously documented in your marketing plan before you answer the next three questions, + What communications objectives are appropriate for Sonic inital campaign? + How can Sonic use personal communications channels to influence its target audience? + Which communication tools would you recommend using after Sonic’ initial product has been in the market for six months? Wy? ‘Confirm that your marketing communications plans make sense in light of Sonic's over- all marketing efforts, Now, as your instructor ditects, summarize your thoughts in the written marketing plan. Chapter 20: Managing Mass Communications: Advertising, Sales Promotions, Events and Experiences, and Public Relations Macs communications will play a key role in Sonic's product introduction. Aer reviewing your ‘arler decisions and thinking about the curzent situation (especially your competitive circum stances), reapond tothe following questions to continue planning Sonic's marketing communica Lions strategy. + Once Sonic begins to use consumer advertising, what goals would be appropriate? + Should Sonic continue consumer and trade sales promotion after the nevr product has been in the market for six months? Explain your reasoning. + Jane Melody wants you to recommend an event sponsorship possibility that would be appro. priate forthe neve-product campaign. What type of event would you suggest, and what objec- tives would you set for the sponsorship? [Record your ideas about mass communications inthe marketing plan you've been writing, Chapter 21: Managing Digital Communications: Online, Social Media, and Mobile Digital communications strategies will be essential to Sonic's marketing plan as brand awareness can be generated quickly through online channels, social media, and word of mouth. Jane Melody is especialy interested in your answers to the following questions. + Hovr should Sonic use word of mouth to generate brand awareness and encourage potential buyers to visi retailers to see the new smart phone in person? + Which social media platforms and networks should Sonie pursue based on their target aud ences! Explin your reasoning, + Ismobile marketing a viable strategy for Sonic's smart phone? Why or why not? ‘Consider your overall marketing objectives as you compile your answers. Document your ideas in your marketing plan, Appendix AISata Chapter 22: Managing Personal Communications: Direct and Database Marketing and Personal Selling Sonic needs a strategy for managing personal communications during its new-product launch, This is the time to look at direct marketing, database marketing, and personal selling, Answer these three questions as you consider Sonic's personal communtcations stralegy. + Which forms of direct marketing are appropriate for Sonic, given its objectives, mass commu: nications arrangements, and channel decisions? + Should Sonic use database marketing to identify and cultivate prospects? What are the oppor- tunities and potential downsides ofthis approach? + Does Sonic need a ditect sales force or can it sell through agents and other outside representatives? Look back at earlier decisions and ideas before you document your comments about personal commanications in your written marketing plan, Chapter 23: Managing a Holistic Marketing Organization for the Long Run the rest of the marketing plan in place, you're ready to make recommendations about how anage Sonic's marketing activities. Here ate some specific questions Jane Melody wants you to consider. + How can Sonic drive customer-focused markeling and strategic innovation throughout the orgenization? + What role should social responsibility play in Sonics marketing? + How can Sonic evaluate its marketing” Suggest several specific teps the company should take nally, draft. ‘To complete your written marketing plan, enter your answers to these questions. the executive summary ofthe plans highlights