Introduction to Introduction to MarketingMarketing

ReviewReview

IDEAS ABOUT MARKETINGIDEAS ABOUT MARKETING• An ActivityAn Activity

• A FunctionA Function

• A Management ProcessA Management Process

• An Orientation An Orientation

• A Social PhilosophyA Social Philosophy

MARKETING APPROACHMARKETING APPROACH

A recognition by the organisation of A recognition by the organisation of the the primacy of customer valuesprimacy of customer values in in exchange...exchange...

...and the focusing of the whole ...and the focusing of the whole organisation and all its activities on organisation and all its activities on mutually satisfying exchanges with mutually satisfying exchanges with customers customers

CORE CONCEPTSCORE CONCEPTS

• EXCHANGEEXCHANGE

• VALUEVALUE

• THE TRANSACTIONTHE TRANSACTION

• THE RELATIONSHIP (1990’s)THE RELATIONSHIP (1990’s)

THE EXCHANGE PROCESSTHE EXCHANGE PROCESS

• UNDERSTANDINGUNDERSTANDING

- customer values and behaviours- customer values and behaviours

• CREATINGCREATING

- customer related values- customer related values

• COMMUNICATINGCOMMUNICATING

- - to inform and persuadeto inform and persuade

• DELIVERINGDELIVERING

THE MARKETING CYCLETHE MARKETING CYCLE

DeliverDeliver

CommunicateCommunicate

Organisation Organisation CustomerCustomer

CreateCreate

UnderstandUnderstand

CUSTOMER VALUESCUSTOMER VALUES

• FUNCTIONAL:FUNCTIONAL:

- “buying things for what they do”- “buying things for what they do”

• SYMBOLIC:SYMBOLIC:

- “buying things for what they mean”- “buying things for what they mean”

• EXPERIENTIAL:EXPERIENTIAL:

- value from the exchange process- value from the exchange process

MARKET-LED, CUSTOMER MARKET-LED, CUSTOMER DRIVENDRIVENCharacterised by:Characterised by:

* * CUSTOMER FOCUSCUSTOMER FOCUS

* LONG TERM VIEW* LONG TERM VIEW

* ADEQUATE INFORMATION* ADEQUATE INFORMATION

* INTEGRATED ACTIVITIES* INTEGRATED ACTIVITIES

* OPERATIONAL EFFICIENCY* OPERATIONAL EFFICIENCY

(Kotler)(Kotler)

BROADENING BROADENING APPLICATIONSAPPLICATIONS

FMCG’s

Consumer Durables

Business to Business

Services marketing

Not for Profit

Social Marketing

1950’s

1990’s

Basic DecisionsBasic Decisions

BusinessBusiness CustomersCustomers

??Who is the Customer?Who is the Customer?

What will we achieveWhat will we achieve

How will we use or resources?How will we use or resources?

Strategy as Matching

PRODUCTS- All the activities and resources of the business that impact the market place

MARKETS- All the total collection of potential customers in a category of market

Types of Strategy

Mass Marketing

Market Segmentation

Target (Niche)Marketing

Maxi- Marketing

Scale of Customer Focus

StrategyStrategy ProductProduct MarketMarket ExamplesExamples

Mass MarketingMass Marketing Standard, generic, Standard, generic, undifferentiatedundifferentiated

LargeLargeCommon Basic Common Basic ValueValue

Rice, Salt, Rice, Salt, Sugar, Steel pipeSugar, Steel pipe

SegmentationSegmentation Different Marketing Different Marketing for groups of for groups of CustomersCustomers

Groups of Groups of Customers with Customers with similar values.similar values.Range of value Range of value setssets

Autos, hand Autos, hand tools, laptops,tools, laptops,softwaresoftware

Target / NicheTarget / Niche High Value – High High Value – High margin brand for margin brand for targeted grouptargeted group

Discrete Customer Discrete Customer group.group.Extended valuesExtended values

Luxury Brands,Luxury Brands,Specialist Specialist equipmentequipment

Maxi-MarketingMaxi-Marketing Customised Customised marketing activitiesmarketing activities

Individuals with Individuals with individual value individual value setssets

Contracting,Contracting,On-line sales On-line sales

General Strategy Types

Ansoff Matrix現有產品 新產品

現有市場

新市場

Understanding Customers

All Marketing decisions are designed on the basis of

Customer Focus

Need to UnderstandNeed to Understand

• Who the Customer is / will beWho the Customer is / will be

• Customer ValuesCustomer Values

• Customer BehavioursCustomer Behaviours

Who the Customer is / will Who the Customer is / will bebe

Need to be able to describe customers / Need to be able to describe customers /

potential customers potential customers

Commonly use characteristics such as:Commonly use characteristics such as:

•Demographics

•Geographics

•Psychographics

Customer ValuesCustomer Values

• FunctionalFunctional

• SymbolicSymbolic

• TransactionalTransactional

Functional ValuesFunctional Values

Customers buy things forCustomers buy things for

what they dowhat they do

Symbolic ValuesSymbolic Values

Customers buy things for Customers buy things for

what they meanwhat they mean

Transaction ValuesTransaction Values

Customers get values from Customers get values from

the experience of exchangethe experience of exchange

Consumer behaviour can be defined as the decision-making process and physical activity involved in:

•acquiring, •evaluating,•using •and disposing of

goods and services

Customer Profile

A basic technique which brings together Consumer Behaviour data as a basis for decision-making

Customer Profiles

Core information on:

- Characteristics- Values- Behaviours

Form the basis for defining target customers and segments

Typical Customer Profile includes:

•Who•How•Where•When•Why

Basic Framework

Motivation Perception

Search

Evaluation

Choice

Learning

Influences on Buyer

Decision levels in Decision levels in organisationsorganisations

StrategicStrategic

Operational

TacticalTactical

Marketing mix decisions

Customer service levels Competitive responses Campaigns

Business direction Market decisions Investment decisions New product development Positioning

Typical applications for Typical applications for marketing researchmarketing research

• Market analysisMarket analysis

• New product/service developmentNew product/service development

• Selection of brand names and packagingSelection of brand names and packaging

• Pricing decisionsPricing decisions

• Advertising and promotion decisionsAdvertising and promotion decisions

• Sales decisionsSales decisions

• Service support and complaint handling decisionsService support and complaint handling decisions

Typical data requirements:Typical data requirements:Product researchProduct research

New products

Gap between current products &

perception

Consumerresearch

Research from international markets

Competitor research

Long range economic studies

Satisfaction levels and trends with current products

Source: Hines

Typical data requirements:Typical data requirements:Pricing decisionsPricing decisions

• Competitor product pricesCompetitor product prices

• Consumer attitudes to price Consumer attitudes to price – what would they expect to pay? what would they expect to pay? – what would they be prepared to paywhat would they be prepared to pay

• Cost/price/volume - what quantities are likely to sell atCost/price/volume - what quantities are likely to sell at

different price levels?different price levels?

Typical data requirements:Typical data requirements:Advertising and promotionAdvertising and promotion

• Size of potential marketSize of potential market

• Demographic characteristics of usersDemographic characteristics of users

• Demographic profiles of segmentsDemographic profiles of segments

• Behaviours and attitudes of different segmentsBehaviours and attitudes of different segments

• Language used by customers in talking about productLanguage used by customers in talking about product

• Share of mind compared with competitorsShare of mind compared with competitors

Typical data requirements:Typical data requirements:Sales decisionsSales decisions

• Sales territoriesSales territories

• Sales personnel efficiencySales personnel efficiency

• Sales statisticsSales statistics

• Sales forecastsSales forecasts

• Sales incentivesSales incentives

• Distributor policyDistributor policy

Primary objective of researcher is to Primary objective of researcher is to provide:provide:

- TimelyTimely

- AccurateAccurate

- RelevantRelevant

Data and analysis to Marketing Data and analysis to Marketing

ManagementManagement

Key word is ‘Robust”Key word is ‘Robust”

"A qualitative "A qualitative observation observation identifies the identifies the presence or presence or absence of absence of something, in something, in contrast to contrast to quantitative quantitative observation, observation, which involves which involves the degree to the degree to which something which something is present "is present "

(MARKETECK, 2009)

OBSERVATION

The systematic process of witnessing and recording behaviour – of people, objects and events

Focus Group An interview conducted by a trained An interview conducted by a trained

moderatormoderator

in a non-structured and natural manner with ain a non-structured and natural manner with a

small group of respondents.small group of respondents.

Group size 8 -12

Group composition Homogenous, respondents prescreened

Physical setting Relaxed, informal setting

Time duration 1 - 3 hours

Recording Use of audio and video cassettes

Moderator Observational, interpersonal, good communication skills needed.

Other Qualitative TechniquesOther Qualitative Techniques

Depth Interview: An unstructured interview that seeks opinions of respondents on a one-to-one basis. Useful for sensitive issues, politics etc.

Protocol Analysis: Involves placing a person in a decision making situation and asking him/her to state everything he/she considers in making a decision. Useful in 1. Purchasing involving a long time frame (car, house) and 2. Where the decision process is too short (greeting card).

Projective technique: Involve situations in which participants are placed in simulated activities hoping that they will divulge information about themselves that are unlikely to be revealed under direct questing.

ExperimentsExperiments

Investigate and evaluate Investigate and evaluate causal relationships between causal relationships between variablesvariables

Differs from other methods in Differs from other methods in the degree of controlthe degree of control

Experiments in Marketing include:

• Test Marketing

• Blind testing

• Extended User Testing

• Pilot Trials

QuestionnairesQuestionnaires

Major DecisionsMajor Decisions

• What to askWhat to ask• How questions are phrasedHow questions are phrased• Sequence of questionsSequence of questions• LayoutLayout• PretestingPretesting

SAMPLING

Probability Sampling Methods

Probability or random sampling gives all Probability or random sampling gives all members of the population a known chance of members of the population a known chance of being selected for inclusion in the sample and being selected for inclusion in the sample and this does not depend upon previous events in this does not depend upon previous events in the selection process. the selection process.

The selection of individuals does not affect the The selection of individuals does not affect the chance of anyone else in the population being chance of anyone else in the population being selected.selected.

Many statistical techniques assume that a Many statistical techniques assume that a sample was selected on a random basissample was selected on a random basis