Marketing

The day started with odds n' ends, which is supposed to be idle discussion of our recent experiences in restaurants, though some of the less swift students still pull out newspaper clippings during this time -- are they so broke that they don't hit up restaurants?

Dave got some veal picatta the other day and in the first bite got a mouthful of cardboard stuck to the bottom of the meat. Patrick went to Ciprianni's with a friend and was shocked by the bad service, the crappy food and the $400 bill...for lunch. Richard spoke of a local restaurant (on the UWS) he hit up with a friend, a homey Latin joint. They noticed people in the restaurant drinking beer...out of paper bags. He also noticed a sign saying they were under new management. It seems when a restaurant changes ownership, they must reapply for a liquor license. When Richard asked if they served beer, the server gave a conspiratorial wink and delivered bottles in paper bags to the table. It seems that if a cop were to pass the restaurant, he could bust them if he saw booze being served...but if he only sees paper bags, he'd have to get a warrant to come in and search the bags for alcoholic content.

We chatted a bit about the annoying ServSafe exam we took on Monday (spelling errors! vague questions! unexpectedly easy!) then moved into more nitty gritty on marketing.

Marketing is all about finding and taking advantage of trends, as opposed to fads. Fads are a quirk, a spoke that comes on quick, rises and falls in a blink. Trends slowly build, sustain, and slowly fade away. Dance music is a trend. The Lambada is a fad. Trends and fads are results of consumer behavior.

We reviewed several models of consumer behavior. In quick succession, there is the Marshallian Economic Model: consumers are rational, as price decreases sales will rise, as the competitions prices fall, your prices will fall, and as you advertise more, your sales will rise. This doesn't always work -- if wagyu beef was listed at $9 for 30 oz, something would be very suspicious. People buy stuff like obscenely expensive watches simply because they are expensive. Fact is if you devalue your core product, consumers won't be willing to pay more for it in the future.

The Pavlovian Learning Model states that behavior is learned. Drives are strong internal stimuli, cues are weaker stimuli from within and the environment. A response is a reaction and reinforcement is positive or negative influence on the response.

Veblomian Sociopsychological Model states the social environment is all important. Trendy restaurants in the meat packing district are not places to eat good food so much as places to be seen.

The Howard-Sheth model of Buyer Behavior accounts for a large number of inputs and outputs, too many to recount here. The Nicosia Model states that the message given out by an institution contrasts with consumer predisposition to create certain results. For example, McDonalds took the name of a perfectly ordinary breed of cow and gave it's name to a burger - the Angus Beef McWhatever was the same old same old, but the message hit on a predisposition to think it meant something more.

The last hour of the class was dedicated to running through the seven steps for putting together a marketing plan.

• Situation Analysis: where you are right now. SWOT - strengths, weaknesses, opportunities, threats. Who is the market? How is the competitor's product perceived?
• Goals: General statement of hoped for results from marketing.
• Objective: Measurable statement to help determine how much should be spent on marketing.
• Strategies: how to reach the objective, specific techniques. Four base strategies: aim for target markets or new markets, focus on core products or develop new products.
• Tactics: Action Plan. Down and dirty, the precise actions
• Budget: Based on tactics, in line with objectives.
• Evaluation: Can be built into tactics. That's why some shops ask for your zip code -- to see if their advertising in a certain area makes a difference.