Marketing, Bus 1050

process of planning and executing for products to satisfy customer objectives

A. People are attracted to solutions to their problems – real or perceived

B People forget. Repetition, recency, and ease of access are required

C People want to feel confident they make/made the right decisions

strategic assessment of company capabilities in a given market

A. Strengths and Weaknesses: internal

B. Opportunities and Threats: external

Marketing Warfare –

Positioning, The Battle for Your Min

Warfare analogies – competitors and market share

1. Moral Law or Tao – harmony, consensus, commitment, cooperation

2. Heaven or Weather – external, uncontrollable factors, flexibility, 3 options

3. Earth or Terrain – geography/competitive landscape, industry infrastructure, reputation 4. Commander or Leadership – virtues of wisdom, benevolence, sincerity, courage, strictness
5. Method and Discipline or Systems – organizational structure, clear functions,chain of command, autonomy, flexibility

‘faux pax’

1. Win without fighting
2. Avoid strength, attack weakness
3. Deception and foreknowledge
4. Preparation and speed
5. ”Shape” your opponent
6. Character-based Leadership

a. P235 line 43 – If the enemy is in superior strength… b. P235 line 37 – When your enemy is near, make him believe you are far away… c. P235 line 99 – Cleverness has never been associated with long delays d. P238 line 65 - Good fighters put themselves beyond possibility of defeat e. P239 line 70 – Opportunity of defeating enemy is provided by the enemy f. P238 line 30 – He will win whose army is animated… g. P241 line 26 – The clever combatant looks to the effect of combined energy…

Brands, ads, jingles

DeOfficiis – study of Roman Law; 2nd book to be printed

ring = delusional power; immoral action is always wrong

1. Marketing fairly, morally

2. Analogy is Themistocles. Is deceit OK?

3. Sparta geographically to Athens

1. Antipater vs Diogenes view points

2. People vs profits; price is amoral – not moral or immoral 3. Ethics code – long term price to pay if price gouge? Stossel paper.

4. Concealment OK? Is not disclosing deceit?

5. In famine and suffering, must act differently

6. Infinite profits/growth not as important

7. Smith and Friedman: not role of individual to save society

8. Rockefeller: should subordinate profits to needs of the community

Caveat emptor – let the buyer beware (buyer responsible to get all the facts)

2. Caveat venditor – let the seller beware (seller must lay out all the facts)

Health and Safety at Risk?

people come together, exchange, both parties happy

A. Catholic Church – code book – how business conducted

therefore, must have principles

thesis, anti-thesis, then the answer

1 Pricing for wealth is OK, but not sell for more than “worth” 2 If buyer pays the price, must think it “worth” it 3 Deception is a sin

1. Three faults a. Known flaw is fraudulent unless disclosed b. Quantity fault – faulty measure is fraudulent c. Quality fault – sick presented as healthy is fraudulent 2. Selling with known faults not disclosed is a sin 3. Selling with faults not known is not a sin 4. Restitution is required on both seller and buyer parts

1. Affirmative disclosure: don’t have to disclose everything unless health issue a. Drug ads b. Product labels: ingredients 2. Known defects a. Not disclosed in promotion – scares off buyer b. ‘Reasonable’ disclosure should occur at point-of-purchase (POP)

1. Charge more than paid for? a. Different argument than Price b. Mark-up or “reasonable profit” at every step in distribution chain (from the manufacturer to the buyer … includes wholesaler, retailer, etc.) 2. Contrast two types of exchange (Aristotle) – natural and unnatural 3. Trading is lawful, therefore not sinful 4. Gain (profit) made through trading , i.e. distribution steps is not sinful

in business – adapt or die (example – buggy whips)

Spencer’s phrase, Darwin borrowed

effect biological adaptation

“evolution” and “adaptation”

Conspicuous Consumption

Economist, observationist, and critic of modern capitalism

are predictable statistically

power of the corporation

1. Leisure class (not lazy) 2. Socially visible goods

acquisitiveness “trickle down” economic classes

1. Sign of prowess – warrior ability 2. Sign of wealth/power

worth judged in comparison of quantity/quality of property

1. Emulation of others 2. Power and esteem 3. Wealth and reputability 4. Honor and inheritance

1. Right kinds of goods 2. Conductance/behavior befitting leisure class 3. Accumulation levels create classes, ranks and grades 4. Obligatory leisure 5. Canon or reputability 6. Canon of expenditure 7. Habits of behavior, standards of behavior, and changes/advances 8. Consumer segmentation

economic motive

When You Add, You Subtract

MEANS OF EXCHANGE

KNOWING WHERE ONE STANDS FINANCIALLY

Assets = Liabilities + Owners Equity

dr↑ cr↓ dr↓ cr↑ dr↓ cr↑

those expected to be realized/used within 12 monthsExample: cash, inventory, accounts receivable

Those assets with long livesExample: buildings, land, patents

DEBTS Short term: those paid in less than 12 months, e.g. accounts payable 2. Long term: those paid in longer than 12 months, e.g. home mortgage

1. For each transaction, must be two entries – a debit and a credit2. Debits must equal credits

debits (dr) on the left; credits (cr) on the right

1 Balance Sheet (BS) (accounting equation) 2 Income (Profit and Loss) Statement (IS) 3 Cash Flow Statement 4 Footnotes 5 Retained earnings (RE) links BS and IS ACCOUNTING CYCLE

FATHER OF ACCOUNTING

1. Three things to run a business a. Cash b. A good bookkeeper and ready mathematician c. Transactions arranged in a systematic way 2. The Venetian system 3. Ubi non est ordo, ibi est confusion (WHERE THERE IS NO ORDER, THERE IS CONFUSION)

1. Begin the business book with God’s name. Why? 2. Make an inventory or asset list – short-term and long-term

example of inventory (asset) list, starting with most liquid

3 books: Memoriale, Giornale, Quaderno

Memoriale/Memorandum 1. All transactions – big and small – as they happen 2. In order – chronologically

Authentication 1. By whom? Today’s equivalent? 2. Seal affixed to attest accuracy and authentication 3. Duplicate books. Good practice? Necessary? Perjury?

The Giornale/Journal 1. In order – pages marked by date 2. Reference source documents 3. Make entries neat and systematic

The Giornale/Journal 1. In order – pages marked by date 2. Reference source documents 3. Make entries neat and systematic

Two expressions: “Per” and “A”

debitore/debit

creditore/credit

“//”

credit on the right

entries made by debit or credit

for cash is debit to cash and credit to capital; cashnormally carries a positive or “debit” balance

(pocketbook/purse/wallet

(property)

a. All you possess, or worth/value…A – L = OE (capital) b. Normally carries a positive or “credit” balance

1. Entries are transferred from the Journal 2. Twice as many pages as the Journal3. A page exists for each account, for example, cash, inventory, accountsreceivable, accounts payable, etc. 4. The first page is always for cash

Memo book and Journal are combined

Amassed a fortune: clever and “knew his own mind”

entered a thousand things; info control can generate wealth

people came to him for details Kept a ledger

rents rather than buys; picks up stones; buys cold rice cakes

(his daughter) frugal ways

1. Be frugal 2. Pat attention to detail 3. Be objective: don’t jump to conclusions, on speculations, keep your own mind 4. Make decisions based on facts

A. Accounts of stock; profit and loss; “casting up shop”

cash duly balanced; accounts always “fit for a view”

extends Pacioli

1. Goods in the shop – inventory 2. Money in cash: profits or capital 3. Debts – liabilities

1. All transactions and details and information must be entered 2. Entries should be made at the time of the transaction 3. Books, like a Christian’s conscience – clean and neat 4. Sloppiness can lead to forgeries or falsities on him

hire it done

1. Never be satisfied with less cash than books state 2. Never be satisfied with more cash than books state 3. Be exact and timely – indicates your “heart” is in the business4. Keep your books present and accurate for your family’s sake in case you diesuddenly

ex-Chairman of GM; MIT Business School

efficient mgmt of fin resources in operational and marketing environment of risk andreturn

A. Finance is about money management B. Involves risk and return

exchange, common value , measure, storage mechanism

1. Hard work“The sleeping fox catches no poultry” “Never leave that till tomorrow which youcan do today” 2. Paying attention to one own business – paying attention to details “For want of a nail, the shoe was lost …” 3. Frugality – beware of the little expenses “A small leak will sink a great ship” “

It is hard for an empty bag to stand upright”

“Creditors have better memories than debtors …”

the ability to use it

for it to make money –compounding

“empty bag”