MarketingAnesh Maniraj Singh

Business Game

• What Marketing mistakes did you make in this exercise?

• Describe your target market for the product/service you were selling?

• What approach did you take towards your market?

Business Game

• How would you describe your target market in terms of their behaviouralcharacteristics?

• What did your group do to ensure the success of your product/service?

What is marketing?

Business Functions

Organisation

Finance

Production

Human Resources

Information

Systems

Marketing

Marketing Activities

Marketing

Advertising Sales ResearchCustomer Service

Marketing - Definition

Marketing is the art of determiningthe customers wants and needs, anddeveloping satisfaction in the form ofproducts and services, whilst makinga profit.

Philip Kotler

The Marketing Equation

Profit+Need

Identification

Need

Satisfaction =

How do people acquire products?

• Subsistence

• Force

• Sympathy

• Exchange

Markets and Industries

• A Market refers to

– Groups of people

– Willing and able to exchange money

– Buy goods and services

• An Industry refers to

– Groups of businesses

– Willing and able to sell goods and services

– In exchange for money

Approaches to the Market

Needs of the Seller

• Production approach

• Product approach

• Selling approach

Needs of the Buyer

• Marketing approach

• Societal marketing

• Relationship marketing

• Electronic marketing

• Social network marketing

Holistic Approach

Understanding Your Customer

Homework

• What is market research? Is it different from marketing research?

• Is Market research necessary? Explain.

• If you had a limited budget, would you be able to conduct market research for a small entrepreneur? If yes, what would you do? Explain.

Definitions

• Research

– Is a systematic search and analysis of facts with the purpose of solving a problem or to get a clearer understanding of a situation

• Market Research

– Involves research of markets, market segments, competition

– Examines potential markets and products

• Marketing Research

– Involves research of marketing activities

– Examines existing markets and products

Common Research Mistakes

• Poor definition of what information is needed

• The wrong technique/approach is used

• Data is misinterpreted

The Marketing Research Process

Define the

Problem

Develop

the

Plan

Present

the

Findings

Analyse

the

Data

Collect

the

Data

Decision

Implement

MarketingConsumer Behaviour

Homework

• What is consumer behaviour?

• Why would a business be interested in understanding its consumers behaviour?

• What does your organisation know about its consumers?

Definition

• Consumer Behavior is the study of

– The mental and social processes and actions aconsumer takes preceding and following the purchaseand use of products and services

• Seeks to answer

– Who?

– Where?

– When?

– Why?

– How much?

Factors that Affect Consumer Behavior

Cultural Factors

• Religious beliefs, values, norms

Socio-cultural Factors

• Relationships with others

Psychological Factors

• Personality, perception, motivation

Personal Factors

• Age, family size, affordability

Marketing Mix Factors

• Product, Price, Place, Promotion

Psychological Factors

Physiological Needs

Safety Needs

Social Needs

Esteem Needs

Self Actualisation

Needs

Exercise

• Can the following companies use use the Maslow’s hierarchy of needs to determine the product/service ranges they sell? Explain.

– Game Stores

– Netcare Group

– SAA

– KFC

– Spur

– Standard Bank

Buying Decision Process

Need

Recognition

Information

Search

Evaluation

Of

Alternatives

Purchase

Post

Purchase

Behavior

MarketingThe Marketing Mix

The Marketing Mix

Product Price

Promotion Place

Target

Market

Marketing MixProduct

Anatomy of a Product

Augmented

Expected

Generic

Core

Benefit

Product Life Cycle

Introduction Growth Maturity Decline

Time

Sal

es

Why do new products fail?

• Poor quality

• Poor advertising and support

• Doesn’t match claims

• High production costs

• Poor timing of launch

• Not meeting the needs of consumers

MarketingBranding

What is a Brand?

• A name, symbol, term or sign that identifiesthe products of one manufacturer fromanother

• Brands help consumers differentiate betweensimilar products

Why Brand?

Branding

Differentiation

Familiarity

Build trust

Build loyalty

Barrier to competition

Prevents switching

Premium price

Lower marketing

costs

Brand Equity

Effective Brand Names

• Easy to Say

• Easy to Spell

• Easily remembered

• Free of ambiguity/negative connotations

• Should not be used by another party

• Communicates the product use/benefit

Service

Tangibility

High

tangibility

Low

tangibility

What is customer value?

• Difference between what a customer gets from a product or service in relation to what he gives to get it.

Benefit – Cost = Value

• Emotion

Keep promises Service excellence Quality of product Keep promises

Information before buying

Information before buying

Keep promises

Courtesy

Knowledgeable staff

Backup service

Service excellence

Friendly staff

Rectify errors

Low priceBackup service

Quality of productService excellence

Friendly staff

Rectify errors Works first time

Free bells and whistles

Customer Emotions

Low priceBackup service

Quality of product

Information before buying

Service excellence Keep promises

Friendly staff

Rectify errors CourtesyWorks first time

Knowledgeable staffFree bells and whistles

Low priceBackup service

Friendly staff

Rectify errors CourtesyWorks first time

Knowledgeable staffFree bells and whistles

Low priceBackup service

Quality of product

Information before buying

Service excellence Keep promises

Rectify errors CourtesyWorks first time

Information before buying

Courtesy

Knowledgeable staff

Customer Service Value

• Deliver on promisesReliability

• Deliver on time and provide helpResponsiveness

• Inspire confidence and trustAssurance

• Attention to customers needsEmpathy

• Appearance, paperwork, facilitiesTangibles

Adapted from Parasuraman, Zeithaml and Berry

Applying ServQual

Reliability Responsiveness

Assurance

Empathy Tangibles

Tailor

Accurate alterations on time

Adjustments to customer requirements

Years of experience

Remembers that one leg is longer

Change room, mirror, packets

FitnessTrainer

Proper adviceInformation

One client at a time.Answers calls

TrustedQualifiedEndorsed

Adjusts training programme

Clean, neat, muscular

UKZN

MarketingMixPRICE

Pricing

Objectives

Profit Maximise

Sales Market Share

Status QuoNon-Price

Competition

• Main consideration is cost recovery

• Cost Based – cost plus pricing

Cost

Price

Volume

Basic Principle

Pricing Strategies

• Price Penetration

– Intended for products with a long life cycle

– Introduction price is low

– Gradual increase in price

• Price Skimming

– Intended for products with short life cycle

– Introduction price is very high

– Gradual decrease to get rid of stocks

• Status Quo Pricing

Pricing Tactics

• One Price Policy

• Variable Pricing

• Flexible Pricing

• Odd/Psychological Pricing

• Bundle Pricing

• Freemium Pricing

• Leader Pricing

• Bait & Switch Pricing

MarketingMixPLACE

Importance of Channels

Specialisation & Division of Labor

Overcoming Discrepancies

Contact Efficiency

Distribution Channels

M

A

N

U

F

A

C

T

U

R

E

R

C

O

N

S

U

M

E

R

Retailer

RetailerWholesaler

RetailerWholesalerAgent

Retail Location

Location

Market Size

Suppliers

Competitors

Visibility

Accessibility

Parking

Costs

Crime

Three secrets for success

• Location

• Location

• Location

Population 5 million

Marketing Mix Promotion

Promotion

Personal Selling

Direct Marketing

Telesales, Catalogue Sales, Television Shopping, Internet Shopping

Publicity

Sponsorships, Press Conferences, Consumer Endorsements

Sales Promotion

Coupons, demonstrations, prizes, loyalty rewards

Advertising

TV, radio, billboards, newspapers etc.

Advertising

• Mass communication

• Relatively cheap

• It is informative

Preferred means of

communication

• To inform – new products, price changes

• To persuade – competitive advertising

• To remind – keep product in consumers mind

Objectives of Advertising

Five M’s of Advertising

Mission

Money

Media Message

Measurement

Modern Media

• E-mail Advertising

• Website Advertising

• Mobile Advertising

• Social Network Advertising

Problems with Advertising

• It is intrusive

• Can be false or grossly exaggerated

• It is one way only

• Can suffer from non-delivery

• May not promote immediate action

Be Careful What You Say!