Marketing Documents BA
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Marketing (IBD/Pre MBA/BA) Kuren Kalantari
Transcript of Marketing Documents BA
Marketing (IBD/Pre MBA/BA)
Kuren Kalantari
Session 1
Marketing & market orientation
Definition of Marketing
“The management process responsible for identifying anticipating and satisfying customers‟ needs profitably.”
CIM
Includes: “Facilitating a mutually beneficial exchange of value between sellers and customers.”
Needs, wants & demand
Need State of felt deprivation
Example: Need food
Wants The form of needs as shaped by culture
and the individual
Example: Want a Big Mac
Demands Wants which are backed by buying
power
Business Philosophies
Production orientation
Product orientation
Selling orientation
Marketing orientation
Societal marketing orientation
Towards market orientation
Production & Product orientation
Sales & Marketing orientation
The marketing concept
Customer focus
Relationship marketing
Internal marketing
The marketing concept
The marketing concept holds that ‘achieving organisational goals depends on determining the needs and wants of target markets and delivering the desired satisfactions more effectively than competitors’ (Kotler)
The scope of marketing
Product planning
Branding
Pricing
Channels of distribution
Selling
Marketing communications
Promotions
Servicing
Relationship with other deptartments
Marketing & society
Societal marketing
Social responsibility is accepting responsibilities to the various publics of an organisation which go beyond contractual or legal requirements.
Responsibilities to customers
The right to be informed of the true facts.
The right to be protected.
The right to safety and health protection.
Consumerism
Consumerism is a term used to describe the increased importance and power of consumers. It includes the increasingly organised consumer groups, and the recognition by producers that consumer satisfaction is the key to long-term profitability.
Other responsibilities
Employees
Suppliers
Competitors
Others…
Value of loyal customers
Lifetime customer value
Cost less to be acquired, if necessary.
Buy broader range of products.
Cost less to be serviced.
Less price sensitive.
They spread +ve WOM.
Relationship marketing
RM is the process of creating, building up and managing long-term relationships with customers, distributors and suppliers. It aims to change the focus from getting customers to keeping customers.
Relationship Marketing Ladder of Loyalty(Christopher et al., 2002).
RM vs transaction
Levels of relationships
Basic
Reactive
Accountable
Proactive
Partnership
How RM operates
Borrow the idea of customer/supplier partnerships from industry.
Recreate the personal feel.
Continually deepen and improve relationship.
Characteristics of RM
Focus on retention, not attraction. Emphasises benefits to customer. Long timescale. Direct and regular contact. Multiple employee/customer contact. Quality and customer satisfaction concern of all
employees. Emphasis on KARM, Serv. Qual & buyer behaviour
rather than marketing mix. Importance of Trust and keeping relationships. Multiple exchanges with a number of parties, network
relationships.
Customer Relationship Management (CRM)
CRM describes the methodologies and ICT systems that help an enterprise manage customer relationships.
Issues in RM
Permission marketing
Legislation; Data Protection Act 1998, Privacy & Electronic Communications (EC Directive) Regulations.
Session 2
Marketing planning
Marketing Planning
Executive summary
Mission & corporate objectives
Situation analysis/marketing audit
SWOT
Marketing objectives
Marketing strategies
Marketing tactics
Budget
Timetable
Control
Summary/conclusion
Planning
Involves:
Setting objectives, quantifying targets for achievement and communication of these targets to others. Objectives: a goal which can be quantified.
Strategy: the method chosen to achieve goals or objectives.
Tactics: how resources are deployed in an agreed strategy.
Marketing planning process
SOSTAC
Situation Analysis
Objectives
Strategy
Tactics
Actions
Control
SMART objectives
Specific
Measurable
Achievable
Relevant
Time-bounded
Situation analysis
PEST factor analysis (Macro environment)
Micro and Internal environment.
SWOT analysis
The marketing audit
„a marketing audit is a systematic, independent and periodic examination of a company‟s or business unit‟s marketing environment, objectives, strategies and activities with a view of determining problem areas and opportunities and recommending a plan of action to improve the company‟s marketing performance‟ (Kotler)
Components of audit
Marketing environment, macro, micro & internal.
Marketing strategies
Marketing systems
Marketing organisation
Marketing function
Marketing productivity
The marketing environment
5 Ms
SPICC
Micro
Macro
PESTEL
The Five Forces Framework
Source: Adapted from M.E. Porter, Competitive Strategy: Techniques for Analyzing Industries and Competitors © 1980, Free
Press, 1980, p. 4. Copyright 1980,1988 by The Free Press, a division of Simon & Schuster Inc. Reproduced with permission.
SWOT
Porter‟s generic strategies
STRATEGIC ADVANTAGE
STRATEGIC T
ARGET
Uniqueness perceivedby customer
Low costposition
Industry-wide
Segmentonly
FOCUS
DIFFERENTIATIONOVERALL
COSTLEADERSHIP
Source: Porter
Ansoff‟s Growth Matrix
Markets
Products
Existing
Existing
New
New
MarketPenetration
MarketDevelopment
ProductDevelopment
Diversification
Product market strategy
Marketpenetration
1
Marketextension
2
Product development
3
Diversification4
ProductCurrent New
Current
New
Market
ProductNewExisting
1 4
162
Existing
New
Market
Souce
: Anso
ff
Setting marketing budgets
% sales
Historic
Competitive parity
All-you-can-afford
The objective and task method
The control cycle
Session 3
Marketing research, segmentation & marketing audit
Marketing research
Marketing research is „the systematic gathering, recording and analysing of data about problems relating to the marketing of goods and services‟ (AMA)
Areas of relevant research
Market research
Product research
Price research
Sales promotion research
Distribution research
Customer research
The marketing research process
Type of data
Primary data are data collected especially for a particular purpose, directly from the relevant source.
Secondary data are data which have already been gathered and assembeld for other purposes or general reference.
Some techniques
Observation
Surveys
Consumer panels
Trade & retails audits
Pre & post testing
Secondary research
Desk research information from:
Inside the firm
Published
Government
Non-government
Research methodologies
Quantitative research gathers statistically valid, numerically measurable data, usually via a survey.
Qualitative research focuses on values, attitudes, beliefs and motivations.
Market segmentation
„the subdividing of a market into distinct and increasingly homogenous subgroups of customers, where any subgroup can conceivably be selected as a target to be met with a distinct marketing mix.‟ (Cannon)
Bases of segmentation
Geographical
Demographic
Psychographic
Geodemographic
Behavioural
Demographic
Age
Gender
Social class
Family type
Geodemographic
Acorn (CACI)
Mosaic (Experian)
The Family Life Cycle
Psychographic
Activities
Interests
Opinions
Social stratification
Benefit segmentation
Behaviour Segmentation
End use
Benefits sought
Usage rate
Loyalty
Attitude
Buyer readiness
eg usage segmentation in the soup market
Dinner party starter
Warming snack
Meal replacement
Recipe ingredient
Easy office lunch
Requirements for effective segmentation
Measurability
Accessibility
Substantiality
Homogenous
Stages of Segmentation for B2B Markets
Identify subgroups within the whole market that share common general characteristics (macro segments)
Select target segments from macro segments based on differences in specific buying characteristics (micro segments)
• Based on the characteristics of organisations and the
broader purchasing context in which they operate.
• Bases for macro segmentations tend to be observable or
obtainable from secondary information.
• Can be divided into different organisational
characteristics.
B2B macro segmentation bases
• Micro segments may exist within a macro
segment.
• A detailed understanding of individual members
of the macro segment needed (management
philosophy, decision making structures,
purchasing policies, etc.).
• Starting with broad characteristics then
developing increasingly fine detail (from
understanding the industry to an organisation’s
operating variables, purchasing approach, and
finally personal characteristics).
B2B micro segmentation bases
B2B Segmentation Bases
Macro
Size
Location
Usage rate
Micro
Product
Applications
Technology
Decision making unit structures.
Purchasing and decision-making processes
Buyer-seller relationships
Targeting
„the use of market segmentation to select and address a key group of potential purchasers‟ (CIM). It involves selecting one or more customer groups and satisfying them with a tailored marketing mix.
Targeting strategies
• The concentrated approach is the most focused
and involves specialising on serving one specific
segment.
• Can lead to very detailed knowledge of the
target segment’s needs and wants.
• This strategy can help keep costs down as there
is only one marketing mix to manage.
• Helps to develop a niche market.
The concentrated targeting strategy
• Involves the development of a number of different
marketing mixes for different segments.
• Allows a business to tailor its offerings to suit different
segments.
• Spreads risk across market segments.
• Requires a detailed overview of the market and its
development potential.
• Can dilute a company’s efforts.
The differentiated targeting strategy
• Least demanding targeting strategy.
• Assumes that the market is one homogenous unit with
no significant differences.
• One single marketing mix serving all needs.
• Relatively inexpensive.
The undifferentiated targeting strategy
Positioning
The place held by a product or service in the consumer‟s mind, in realty on to the competition.
Perceptual Map
Marketing Information System (MkIS)
Internal reporting system.
Marketing intelligence system.
Marketing research.
Analytical marketing system.
The marketing information system (MkIS)
Marketingintelligence
Marketingresearch
Internalrecords
Informationanalysis
Marketingenvironment
• Target markets
• Marketing channels
• Competitors
• Publics
• Macro-environment forces
Marketingmanagers
• Analysis
• Planning
• Implementation
• Organisation
• Control
Developing information
Distributinginformation
Assessinginformation
needs
Marketing information system
Marketing decisions and communications
Source: Kotler et al
session 4
Managing the marketing mix
The basic marketing mix
Product-Service spectrum
The service marketing mix
People
Process
Physical evidence
The extended marketing mix
The additional elements deal with the characteristics of services
People - good training for service staff, appearance of staff, staff carefully selected, and held more accountable
Process - fast service tills, part time staff to cover highest periods of demand, easy booking systems for appointments
Physical evidence -internal and external appearance of premises, short queues, modern equipment, pleasant waiting areas
Product PricePromotion Place
People
Appearance
Attitude
Professionalism
Skills/competence
Commitment
Behaviour
Discretion/confidentiality
Integrity/ethics
Process
The way the marketing tasks are achieved.
Procedures
Policies
Automation process
Information flow
Capacity levels for continuous performance
Speed/timing of service
Queuing/accessibility arrangements
Physical evidence
Environment of service delivery
Facilities
Tangible evidence of purchase
session 5
Products & services
Product definitions
Anything offered to a market for attention, acquisition, use, or
consumption that might satisfy a need or want.
Product levels
Features and Benefits
Features
Attributes of products
Benefits
What it does for the customer
Customer buy benefits!
Product and Service Classifications
Consumer products
Industrial products
Consumer goods
Convenience goods
Shopping goods
Speciality goods
Unsought goods
Industrial goods
Installations
Accessories
Raw materials
Components
supplies
Branding
A brand is a name, term, sumbol or design intended to identify the product of one seller and to differentiate it from those of competitors.
Stages of the PLC
Product portfolio planning
A company‟s product portfolio is all the product lines and items that the company offers for sale.
BCG‟s Growth Share Matrix
Low
2
4
6
8
10
12
14
16
1820
High
10x 1x 0.1x
High LowRelative market share
STARS QUESTION MARKS(problem children)
CASH COWS DOGS
Modest+ or -cash flow
Largenegativecashflow
Largepositivecashflow
Modest+ or -cash flow
Mark
et
grow
th
New Product Development (NPD)
Why develop new products:
Changing needs and wants
Outpace competitors
Respond to environmental Os & Ts
Extend product portfolio
Extend the maturity phase of PLC
Refresh the product portfolio
Degrees of newness
Unquestionably new
The partially new product
Major product change
Minor product change
Sources of new products
Licensing
Acquisition
Internal product development
Customers
Inventors
Competition
Patent agents
Academic institutions
PEST envirnment
NPD Process
The diffusion of innovation
Functions of packaging
Protection of contents
Distribution
Selling
User convenience
Compliance
Promotion
Mangement information
Price
Price can be defined as a measure of the value exchanged by the buyer for the value offered by the seller
Price
Price is the amount of money charged for a good or service
The only marketing mix element that produces revenue
Changing too much chases away potential customers, charging too little cuts revenue
“The real issue is value, not price.”
-Robert T. Lindgren
Factors to Considerwhen Setting Prices
General Pricing Approaches
Cost-Based Pricing
Break-Even Analysis and Target Profit Pricing
Value-Based Pricing
Competition-Based Pricing
Pricing policy
Price sensitivity refers to the effect a change in price will have on customers
Pricing Strategies
New-Product Pricing Strategies
Existing-Product Pricing Strategies
Psychological Pricing
Promotional Pricing
New-ProductPricing Strategies
Market-Skimming Pricing
Market-Penetration Pricing
Market Skimming Market Penetration
> Setting a high price for a new product to skim maximum revenues from the target market.
> Results in fewer, more profitable sales.
> Popular night club charges a high cover charge
> Setting a low price for a new product in order to attract a large number of guests.
> Results in a larger market share.
> New Marriott
Setting Initial Product Prices
Otherpricing strategies Product-Bundle Pricing Early cash recovery objective Intermediate customer pricing (RRP) Target pricing Going rate pricing Price discrimination/differential pricing Going rate pricing Quantum price Odd number pricing One coin purchase Gift purchases
Session 6
Place or distribution
&
Promotion or Marketing Communications
Place or distribution
Place is concerned with the selection of distribution channels used to deliver goods to the consumer.
Channel functions
Transport
Stockholding & storage
Local knowledge
Promotion
Display for sale
Value added services
• Wholesalers - do not normally deal with the end
consumer instead deal with other intermediaries,
usually retailers. Exception to this is in the B2B market.
Wholesalers do not take legal title to the goods.
• Retailers - sell direct to the consumer and may purchase
direct from the manufacturer or wholesaler.
Types of intermediary
• Distributors and dealers - add value through services
associated with stocking or selling inventory, credit and
after sales service.
• Franchises hold contracts to supply and market a
product/service to the blueprint of the franchisee.
• Agents and brokers have legal authority to act on behalf
of the manufacturer without taking legal title to the goods
or handling the products directly.
Types of intermediary cont.
Channel structure = the route selected to move a
product to market through the different intermediaries.
Channel structures
Channel decisions
Choosing distribution channels
1. Direct distribution
2. Indirect distribution
Consumer channel structures
B2B channels structures
Other considerations
Number of intermediate stages to be used.
Extent of manufacturer support given.
Manufacturer channel domination aspirations.
Manufacturer marketing integration objectives.
Factors in channel decisions
Customers
Product characteristics
Distributor characteristics
Competitor channel choice
The supplier‟s own characteristics
Distribution strategies
Marketing communications
„All forms of communication between an organisation and its customers and potential customers.‟ (BPP)
„Marketing communications is an audience centred activity designed to encourage engagement between participants.‟ (Fill)
Relative importance of promotional tools
The interrelationships between tools, media and audiences
Above and below the line
Factors affecting emphasis of tools
Push or pull strategy
Type of product/market
PLC
Buyer readiness stage
Session 7
Marketing in context
Marketing in context
Classic marketing context:
- FMCG
- Consumer durables
B2B
Services
Not for profit (NFP)
SMEs
B2B market categories
Capital goods
Components & materials
Supplies
Business services
B2B product distinction
Conformity with standards
Technical sophistication
High order values
Irregularity of purchase
B2B DMU
The DMU is all those individuals and groups who participate in the purchasing decision process, who share some common goals and the risks arising from the decision.
B2B DMU participants
Users
Influencers
Deciders
Approvers
Buyers
Gatekeepers
Marketing mix differences
Product
- Large service element (e.g. training)
- Custom built
- Packaging for protection
- Efficiency features important
Price
- Less fixed
- negotiable
Characteristics of Business Markets
Fewer, larger buyers
Close supplier-customer relationships
Professional purchasing
Many buying influences
Multiple sales calls
Derived demand
Inelastic demand
Fluctuating demand
Geographically concentrated buyers
Direct purchasing
Marketing mix differences
Differences between B2B and
consumer marketing (1 of 3)
Differences between B2B and
consumer marketing (2 of 3)
Differences between B2B and
consumer marketing (3 of 3)
Differences between services & products
Service communication model
NFP categories
Non-profit organisation marketing (hospitals & colleges)
Social marketing: seek to shape social attitudes.
Distinctive NFP characteristics
Objectives: not profit based
Control of marketing activities
Difficult as most objectives are non-quantitative
Target markets
Marketing mixes
Target markets
Beneficiaries
Supporters
Regulators: formal bodies (Charities
Commission)
Stakeholders: trustees, managers, staff & representatives of beneficiaries
Marketing Mix
Product: Ideas as well as goods and services.
Price: Financial cost less important than opportunity cost.
Place: sometimes problematic as reliance is on volunteers.
Promotion
Objectives different from B2B & B2C. Message development:
- Rational, emotional and moral framework.- Reward & situation framework.- Attitude change framework.
Promotional methods- Paid advertising- Unpaid (public service advertising)- Sales promotion- PR- Personal selling & communication- Direct marketing
Small or Medium Sized Enterprises (SME)
Limited resources
Most marketing activities to support personal selling.
Marketing in micro enterprises
Under 10 employees
Lack financial & human resources.
Most are service businesses.
Distribution through mail order, specialist retailers, client premises, or Internet.
Promotion: WOM
WOM & Viral marketing
WOM is the speading of information through human interaction alone.
Viral marketing means spreading a brand message using wom or w.o.mouse, from a few points of dissemination.
Conventional promotion
Direct marketing
Door drops
Public relations
Advertising
Sales promotion
The global context
Globalisation: The growing interdependence of countries world-wide through the increasing volume and variety of cross-border transactions in goods and services, and also through the more rapid and widespread diffusion of technology. Not just an economic phenomenon, but frequently described as such.
What are the drivers
Media developments
More travel
Better infrastructures
ICT
Trade agreements, political changes and deregulation
The power of multinational organisations
International marketing mix considerations
Product strategies
Creating a global product
Adapting the product to local conditions
Developing a country specific product.
Arguments for product standardisation
Economies of scales- Production
- R & D
- Marketing
Consumer mobility
Technology complexity
Arguments for product adaptation
Greater sales
Differences in local conditions
Political factors: taxation, legislation, pressure of
public opinion
Local producers
Place
Major entry modes
- Export: Direct or indirect
- Contractual: Licensing or franchising
- Investment: Sole venture or joint
venture
Promotion
Usually must be adapted.
Cultural factors
Language
Geographical remoteness (media
penetration)
Media problems
Availability
Costs
Coverage
Lack of information on the characteristics of the target market.
Price
Exchange rates
Average income
The virtual marketplace
E-commerce is typically, the online version of a business process or commercial activity that is already available offline.
This is opposed to E-business, which is an entirely new business model that could NOT exist without the capabilities of the Internet.
Virtual markets
B2B
B2C
B2E
G2C
C2C
B2B E-commerce
E-procurement
Tactical B2B
Strategic B2B
