Marketing with NLP

www.NLP-Success-Coach.com

THE MARKETING PROCESS

Facilitator: DEAN EGAN


Topic’s

The Marketing Process

The Consumer

Global Marketing

Targeting the Market

Market Research


Topic’s

Establishing Value & Pricing

Retailing

Advertising

Personal Selling & Sales


Marketing Services-The Intangible Product

THE MARKETING PROCESS


The Marketing Process

Marketing is the activity, set of institutions,

and processes for creating, capturing,

communicating, delivering, and exchanging

offerings that have value for customers,

clients, partners, and society.



Marketing helpscreate value.

Marketing requires product, price, placement, and

promotion decisions.

Marketing entailsan exchange.

Marketing is aboutsatisfying

customer needs and wants.

Marketing occurs in many settings.

Marketing can be performed by both

individuals and organizations.

Marketing

What Do We Market?

Things or Products

People

Services

Ideas


Why is Marketing Important?

Improves society by providing products to consumers.

Makes life easier for consumers.

Provides employment opportunities.

Occurs throughout the supply chain process.

Occurs throughout the entire company.

Allows for company growth such as global markets.

Can create entrepreneurship, which can create employment.


The History of Marketing

Production Oriented Era

Focused on producing, not options.

Sales Oriented Era

Focused on selling after the depression.

Market Oriented Era

Focused on the marketing aspects .

Value-Based Marketing Era

Focused on the value.


Production

SalesMarketin

g

Value-Based

Marketing

The Turn of the Century 1920 1950 1990

What is Value-Based Marketing?

It is the relationship between the perceived benefits of the

product or service and its cost.

Balancing Benefits with Costs: Value-oriented marketers

continuously measure benefits that customers perceive

against the cost of their products or services.


Received Benefits Giving up Time/Money

Building Relationships with Customers

Transactional Orientation: The buyer-seller relationship is merely a

series of individual transactions.

Relational Orientation: Is based on the more traditional view; that the

buyers and sellers should develop a long-term relationship.

Marketing Entails an Exchange


CommunicationsDelivery

Information Money

Marketing Channels

Business to Business (B2B)

Business to Consumer (B2C)

Consumer to Consumer (C2C)

Supply Chain Raw MaterialManufacturerRetailerConsumer



B2B B2C C2C

Manufacturer(Makes a

Computer)

Retailer(Sells the

Computer)

Consumer A(Buys the Computer)

Consumer B(Buys the

Computer from Consumer A)

Marketing Can Be Performed by Both Individuals and Organizations

How Firms Compete on the Basis of Value

With all of the current technology and simple formulas,

marketers should be able to deliver value consistently,

right? Well, not exactly. In today’s quickly changing world,

consistently, creating and delivering value is quite

difficult.

Consumers buying habits constantly change, competitors

are always entering the market, and now consumers have

the ability to buy products and services from anyone

anywhere in the world.


How do Firms Become Value Driven?

Sharing Information

Balancing Benefits with Costs

Building Relationships with Customers


The Marketing Plan


Step 1: Business Mission & Objectives

Step 2: Situation AnalysisSWOT

Step 3: Identify Opportunities

Step 4: Implement Marketing Mix

Step 5: Evaluate Performance Using Marketing Metrics

Planning Phase

Implementation Phase

Control Phase

Marketing Strategy

Segmentation Targeting Positioning

Product Price Place Promotion

Ethics

The philosophical examination, from a moral

standpoint, of particular issues in private and

public life that are matters of moral judgment.

It is thus, a term used to describe attempts to

use philosophical methods to identify the morally

correct course of action in various fields of human

life.


Ethics

Business Ethics: This refers to ethical studies

specifically for the cooperate and business worlds.

Marketing Ethics: This refers to the use of ethics

In developing marketing strategies and plans.

Ethical Climate: This refers to creating an ethical

environment within which one works.


The Framework for Ethical Decision Making

Identify the Issues

Discuss and list any issues that have arisen.

Gather Information & Identify Who This Affects

Not all issues affect everyone, so be sure to identify whom

this pertains too.

Brainstorm Alternatives

Always have a list of alternative solutions to the ethical

dilemma/issue.

Select a Course of Action

Determine what actions should be taken.


How to Integrate Ethics into the Marketing Strategy

The Planning Phase

It is important to introduce ethics in any company’s mission.

The Implementation Phase

It is important to choose the segments that will be targeted

ethically and to use ethics within the 4 P’s such as pricing

and promotion.

The Control Phase

It is important that when an evaluation is made that it is fair

and ethical.


Ethical Decision-Making Model


Identify Issues

Gather Information and Identify Stockholders

Brainstorm and Evaluate

Alternatives Choose Course of Action

Step 1 Step 2 Step 3 Step 4

What Is Social Responsibility?

Social responsibility refers to the actions that

individuals take throughout the course of business

operations to ensure that ethical decisions are

made.



Corporate Social

Responsibility(CSR)

Output

Consumer

Cause/Issue

Company

Consumer

Company

Cause/Issue

Input

CSR Model

The 4 P’s

Product

Remember that there are different types of

products such as actual goods, services, ideas,

and people. Create value for the product. Decide what sets this product apart from any

other product on the market.


The 4 P’s

Price

Linked to the value of the product. If the value is

perceived as high then the consumer is willing to

pay more. The key is to determine the maximum

value at which the customer feels satisfied while

still making a profit. Always consider the competitor’s price.


The 4 P’s

Placement Choose your market wisely. Conduct research to determine where the best

market is especially for new products. Determine where the product will be sold based

on the perceived value. Consider the use of supply chain management

in the placement process.


The 4 P’s

Promotion Promoting the value of the product to the

customer. Consider different avenues such as the internet,

the media and people for advertising purposes. Use associations to things that people are

familiar with already for promoting. Focus on the value of the product.


The Strategic Planning Process

The strategic planning process is a set of steps,

which someone in marketing would go through; to

develop a marketing plan.

Phase 1 The Planning

Step 1

This is when the mission and vision of the

business is defined. A company’s mission is a

broad statement of its goals and purpose. It should

include the nature of the business as well as well

as strategies to accomplish their goals.


Phase 1 The Planning

Step 2

A situation analysis is done which analyzes how

both individuals inside the firm and outside the

firm can affect the potential for success.

The situation analysis is done by using a SWOT

analysis.


S.W.O.T Analysis

Evaluation

Internal

External

Environment

Strengths•Strong brand identity•Retail store network•Grocery network

Weaknesses•Reliance on joint ventures•Rapid growth erodes customer experience

Opportunities•Expansion outside of the U.S. market•Social & green marketing efforts

Threats•Potential saturation of the U.S. market•Intense competition


Phase 2 The Implementation

Step 3

This is when managers can identify and evaluate

different opportunities through segmentation, targeting and

positioning.

Segmentation: Determining the different segments of the

market that consumers belong too.

Targeting: What areas to focus on for each segment.

Positioning: How to position the firm within each of the

target segments.


Phase 2 The Implementation

Step 4

This is when the 4 P’s of marketing are implemented in a

marketing plan. The firm decides what the product is and

how to create value, then it decides what the price is, then

where to place the product and how to promote it. The firm

must then decide how to allocate the resources of the

company. The initial stage of this is done through the

Strategic Business Unit, which is usually formed at the first

of the 4 P’s.


Phase 3 The Control

Step 5

This is for evaluating the performance of the

marketing strategy. Managers at this step usually

evaluate the other steps to determine if their plan

was effective. Performance Objective Financial Performance Metrics


What is a Marketing Strategy?

A marketing strategy identifies a firms target

market, a related marketing mix- their 4 P’s and

the bases upon which the firm plans to build a

sustainable competitive advantage.

Sustainable Competitive Advantage: is defined

as an advantage the competition that is not easily

copied, and thus can be maintained over a long

period of time.


Growth Strategies

Market Penetration Strategy: This focuses on the current

markets and the current products and services.

Market Development Strategy: This focuses on the new

markets and the current products and services.

Product Development Strategy: This focuses on the

current markets and the new products and services.

Diversification Strategy: This focuses on both new

markets and new products.



Marketing/Products and Services Strategies

Products and Services

Markets Current New

Current Market Penetration Product Development

New Market Development Diversification

Scenario Planning Process

This is the process of integrating the information

collected during the situation analysis, the

opportunity analysis, and the marketing plan

process.

The collective data helps the firm understand the

potential performance outcomes associated with

different marketing mix scenarios.


Steps In Planning A Scenario


Step 1: Assess the current situation by examining the firm’s strengths and weaknesses.

Step 2: Assess what could affect the firm by examining the firm’s opportunities and threats.

Step 3: Identify different scenarios.

Step 4: Apply the marketing mix to the different scenarios.

Step 5: Assess the profitability of each scenario.

Macro Strategies

Customer Excellence: This is when the firm focuses on

The excellent services for the customer to retain loyal

customers.

Operational Excellence: This is when a firm focuses on

having effective operations to make the company efficient.

Product Excellence: This is when the firm focuses on the

branding on the product to create value in order to achieve

a high-ranking product.


Macro Strategies for Developing Customer Value


Customer Value

Customer Excellence

Operations Excellence

Product Excellence

Locational Excellence

Analyzing the Market Environment


Consumers

Company

Immediate Environment

Competition CorporatePartners

Analyzing the Market Environment


Macro Environment

Consumers

Culture Demographics

Social

Technology

Political/Legal

Economic

The Environment

Analyzing the Environment

This is the process of paying close attention to consumer needs and

the continuous monitoring of the business environment in which the

company operates.

The Marketing Environment

This is referring to all of the things happening in our world that may

have a direct impact on business. The environment is an external

concept and therefore, is outside of the firm's control.

The Immediate Environment The Company The Competition The Corporate Partners


The Macro Environment

The Culture

The culture is defined as, the shared meanings,

beliefs, morals, values, and customs of a group of

people. Country Culture: The characteristics of the country

that we live in, including trends and what people

want. Regional Culture: The characteristics of the area

that people live in, including how we refer to things.



The Demographics

The demographics is the characteristics of the human population.

Cohorts: People of the same generation, same age group, example seniors, baby boomers etc

Income: refers to individual income and household income. The trend in the U.S. is that income has become polarized.

Education: Studies indicate that the higher the level of education, the higher the job prospects. This information is used to target segments.

Gender: Observe the trend that gender roles have transitioned. Ethnicity: The U.S. has become a diverse country and depending on

one’s ethnic background, things may appeal to them differently.



Social Trends

Social trends is defined as, a persistent change in social relations and

social structure over time. Trends are the aggregate effect of many

individual and group actions, bureaucratization, industrialization,

urbanization, suburbanization. Greener Consumers: This is the consumers demand for green-

oriented products. Green Marketing involves the strategic efforts to supply customers with environmentally friendly merchandise.

Privacy Concerns: Identity theft is on the rise, which has created the need for firms to protect client information by implementing and enforcing strict privacy policies.

The Time-Poor Society: People no longer have time to shop at leisure.



Technology

Technology advances have accelerated over the last

decade that has improved the value products and services.

Firms are able to track an item from the moment it is

manufactured, when the item goes through the distribution system, to the retail store, and into the hands of the final consumer.

Inventory Management Alpha Moms: Tech savvy, family-centric, working

mothers.



The Economy

This is referring to the monitoring of the general economic situation, for

both in country and abroad. The economy situation has a direct

influences the way consumers buy merchandise and how they spend

their money. Inflation: This is referring to the increase in the price of goods and

services. Interest Rates: The cost of borrowing money.

Politics/Regulatory Environment

It is important to keep track of the politics since this leads to laws and

regulations, which may affect the ability to market certain products.


THE CONSUMER


Why Do People Shop?

Habitual Shopping: This is when individuals shop and purchase things

that they are just used to buying, such as Starbucks or even regular

shopping such as shopping for jeans.

Limited Problem Solving: This requires the consumer to have

Moderate effort and typically will lead to something that is short term

that has the potential to change quickly. It however can be long term.

Extended Problem Solving: This requires in depth effort and may

involve quite a bit of risk such as purchasing a house or car. It is

typically a long-term solution.

The Consumer Decision-Making Process

Step 1: Need Recognition

Step 2: Research & Gather Information

Step 3: Evaluate Alternatives

Step 4: The Actual Purchase

Step 5: Post Purchase

Need Recognition

Purchase Post Purchase

InformationSearch

AlternativeEvaluation

Consumers’ Needs Classified

Functional Needs: These typically refer to actual

products such as food, clothing, transportation etc.

Psychological Needs: These typically refer to

services, such as getting a manicure or high-end

physical products such as a high-end car.

Researching The Product And Gathering Information

Internal: The consumer reflects on their own

memory and knowledge of the product.

External: Actual research about the product is

completed; by the consumer.

Factors That Can Affect The Consumer Decision Making Process

Psychology: People’s perceptions and motives

can influence why they purchase things.

Attitudes: Things can influence people’s attitudes

or sometimes they have innate attitudes about the

product or service.


Social Factors: Such as ones’ family, culture and

social groups.

Situational Factors: Situational factors are

related to the purchase and shopping situation; as

well as the persons attitude at the time of and after

the purchase.

Psychological Factors

Situational Factors

Social Factors

Marketing Mix

ProducePricePlacementPromotion

MotivesAttitudesPerceptionsLearning/Lifestyle

Purchase SituationShopping SituationTemporal State

FamilyReference GroupsCulture

ConsumerDecisionProcess


GLOBAL MARKETING

Global marketing refers to marketing activities

coordinated and integrated across multiple country markets.


Globalization

This is the process by which goods, services,

capital, and people, information, and ideas flow

across national borders.

Globalization of Products

This refers to manufactures’ producing of goods and

services from around the globe to take advantage of

national differences in the cost and quality of various

factors of production, as in labor, energy, land, and capital.


Factors In Assessing The Global Market

Economic Analysis

Marketers look for a healthy economy. Marketers also assess the Gross Domestic Product:

defined as the market value of the goods and services produced by a country in a year.

Also assess other factors such as the HDI- Human development index: a measurement of 3 indicators of the quality of life: life expectancy at birth, educational attainment and also average income.



Infrastructure and Technology Infrastructures are the basic facilities, services, and

installations needed for a community or society to function.

Marketers focus on transportation, distribution channels, communication and commerce



Government Government’s actions can affect marketing in terms

of regulatory practices. Tariffs: a tax levied on a ‘good’ imported into the

country. Quota: this refers to the maximum amount of a

product that can be brought into the country. Boycott: when a group refuses to deal with a certain

organization.



Socio-Cultural Analysis Culture: this is a set of values, beliefs,

understandings, and ways of doing things

shared by members of society.

Exchange Control: Regulation of the country’s

exchange rate. (the measurement of one country’s

dollar vs. another).


Countertrade: When goods and services are traded

and not funds.

Trade Agreements: When two or more countries

have actual agreements.



The International Market Entry Evaluation Process

Purpose

Is to gauge which international market

or markets offer the best opportunities for the

firm’s products or services to succeed.


The International Market Entry Evaluation Process

Step 1: Country Identification: Choosing which

country/countries to enter.

Step 2: Preliminary Screening: Rank nations based on the

factors mentioned above. (exchange rates/government policies)

Step 3: In-Depth Screening

Step 4: Final Selection: Choosing the country/countries.

Step 5: Direct Experience: Marketers use this as an opportunity

to personally go the country, interact with the people, and learn

about the lifestyle and culture.


Types Of Global Marketing Opportunities

Exporting: manufacturing the good locally and selling them in another

country.

Franchising: When a company has a contract between you and them

to promote their name but with your ownership.

Strategic Alliance: When firms collaborate to build relationships but

do not invest in each other….example…AA one world alliance.

Joint Venture: The local firm pools resources with a firm abroad in the

desired market to create a new venture.

Direct Investment: the firm going global maintains ownership of all its

entities including plants and manufacturing sites.


Global Marketing and the Marketing Mix

Placement The Internet: Marketers can use the internet to

actually sell products worldwide. Licensing: A firm charges a fee for the use of their

technology. International Distributors: These typically have an in

already into the market. Strategic Alliances Joint Ventures



Price

International Pricing Approaches: Export Pricing: A price is set by the home based managers

for the international market. Non-Cash Payment: Counter trading Transfer Pricing: A price is set by the home based manager

but the product them goes to an international subsidiary who can change the price

Standardization vs. Adaptation: The marketer evaluates whether you use a set or standard price or do you adapt to conditions in the foreign market



Promotion Media Choices: May not be the same as in the

home country. Advertising: What appeals to the foreign market?


TARGETING THE MARKET


The S.T.P. Process

Segmentation

Step 1: Establish Your Objectives And Overall Strategies

Differentiated Segmentation Strategy: Using the same company and having different segments. Example Regis hair salons-Regis, Trade Secret and Master Cuts.

Concentrated Segmentation Strategy: This is when a company selects a single segment and finds a product that would be suitable to that market. It is concentrated in that they are focusing on one market and one product.

Micromarketing: This is when the company caters to the individual and creates products just for that one person.


The S.T.P. Process

SegmentationStep 2: Describe The Segments

Geographic Segmentation: This is when customers are organized based on their geographic location.

Demographic Segmentation: This is when customers are organized based on certain demographic segments.

Psychographic Segmentation: This allows the consumer to decide what segment they fall into based on how they see themselves.

Benefit Segmentation: This allows consumers to be grouped based on the benefit of the product.

Geo-Demographic Segmentation: This mixes both the demographic and the geographic segmentation.


The S.T.P. Process

Targeting

Step 3: Evaluating The Attractiveness Of The Segment

Identify: The firm must identify who in the community is able to design the products or services they need.

Substantial: The firm must determine if the market is substantially large enough to turn a profit.

Reachable: The firm must determine if they are able to reach out to the market.

Responsive: For a marketing venture to be successful, the consumers must respond, either by additional purchases or through referrals.

Profitable: The firm has to determine whether or not the efforts were profitable enough.


The S.T.P. Process

Targeting

Step 4: Selecting the Target Market

The firm will actually select the market at this point.

The firm will most likely use the results of the SWOT.


The S.T.P. Process

Positioning

Step 5: Identify And Develop Positioning Strategy

Value: Relationship between benefits to cost.

Salient Attributes: This focuses on some of the attributes

of the product that are important to the particular market.

Symbol: The Company can use a symbol to promote their product.

Competition: This is when the firm uses the competitor to launch their marketing campaign.


The 5-Stages of Positioning

Determine the consumers’ perceptions about the product and how they have evaluated it.

Identify The Competitor’s Position: This is finding out how a consumer looks at the company’s brand vs. the competitors.

Determine The Preference Of The Consumer.

Select The Position For The Company: This is determining where the product will go from here.

Monitor The Positioning Strategy: Constantly evaluate your position.


THE MARKET RESEARCH PROCESS

Define the objectives and research needs.

Design the research project.

Secondary Data: Data that has been collected by someone else.

~Primary Data: Data that you the researcher are compiling.



Data Collection: There are several methods of collecting.

~Observation: This is when the researcher observes.

~Interviews: The researcher sends out questionnaires.

It is important to decide who the sample population will be. This can either be a random sample, a selected sample or a stratified sample.

Analyzing the Data

Present the Results




DefiningObjectives

DesigningThe

Research Project

DataCollection

AnalyzingData

Presenting Results

Step 1 Step 2 Step 3 Step 4 Step 5

Product, Branding, and Packaging Decisions

Product Assortment

Also known as product mix, this is the complete package of

products being offered by a firm or company.

Product Lines

Grouping the products that are used or belong together in a

broad sense, such as household items or pet products.

Product Category

Grouping the products that go together under one category,

such as pet food.


Product Breadth And Depth

Each category within a product line may use the

same or different brands. Which are the names,

terms, designs, symbols, or any other feature that

identify one seller’s good or service as distinct from

those of other sellers.

Breadth: The number of product lines (aka variety)

offered by the firm.

Depth: The number of categories within a certain

product line.


Changing the Breadth and Depth

A company may change their product mix’s breadth

or depth, by either adding to or deleting categories.

Companies offer add new product categories to

attract new or evolving markets, or to increase sales.

Sometimes it is necessary to delete entire product

lines to address changing market conditions or to stay

in line with new company strategic strategies.


Changing the Breadth and Depth

Increasing the Breadth: This is when the firm

increases the number of lines offered.

Decreasing the Breadth: Taking away a line from a

firm to make it more specialized.

Increasing the Depth: Adding more categories within

the certain line.

Decreasing the Depth: Removing categories from a

certain line.


The Value Of Branding And Brands

It makes purchasing easier. It helps consumers make quick decisions since they may be familiar with the brands.

It establishes loyalty and confidence. If the consumer uses the brand over and over, and they like it then they will stick with the brand name.

It protects the brand from competition with respect to prices.

It reduces marketing costs. The brand speaks for itself.

The brand can have an impact on the market value of the product.


The Value Of Branding And Brands

Brand Equity: The positives or negatives that are linked to a

brand; that can add or subtract from the value of the brand.

Brand Awareness: This measures how well the consumer

knows the brand.

Perceived Value: The value of the product.

Brand Association: The associations that the consumer

makes between the brands the attributes of the brand.

Brand Loyalty: This is when the consumer buys the same

brand repeatedly.


Branding Strategies

Brand Ownership

National Brands: These are owned by the manufacturer,

example, Coke and Adidas.

Private Label: Labels that are sold in stores and made by the

store.

Generic Brands: Sold without a brand name attached to it,

such as generic medicines.


Branding Strategies

Naming Brands and Product Lines

Corporate or Family Brands: This is when the firm uses their

name to brand all their products such as GE. Some products

may apply it to their entire product line and not just the one

category of product.

Individual Brands: This is when the larger firms produces

single products and then uses each product individually.

Example proctor and gamble and their line such as tide.


Brand Extension

This is when firms use the same brand name for new products or for

extending their markets globally.

Brand Dilution: This is when the firm uses their name for other

Products which results in the original product not being deemed as

good as it was before.

Co-Branding: This is when firms mix two brand names together.

Brand Licensing: An actual license is involved. One firm contracts

with another to use their brand name and logo.

Brand Repositioning: This is when the firm changes it is image of

the brand in an attempt to increase sales and profit. This can be

done when trying to focus on new markets.

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Product Packaging

It is important to remember that the product packaging appeals

to the consumers.

Primary Package: the package that the actual product is in.

Secondary Package: this is when the primary package is

placed in something else.

Product Labeling

This is the way the product is labeled.

Putting information on a package provides the consumer with the information that they need.



Developing New Products

Innovation: This is the process by which ideas

become new products.

Diffusion of Innovation: This is the rate at which the

new product gets in to the market.


Categories of Consumers

Innovators: The portion of the population wanting to be the first to

try a new product.

Early Adapters: This is the second set of consumers that would use

the new product.

Early Majority: This is the third group of consumer which actually

represents the largest component of the market. Typically once they

get involved in the new product this is when the product starts

becoming profitable.

Late Majority: The last big set of consumers to use the product.

Laggards: This is a group of the market that likes to avoid change

and use the traditional and older products until they’re not available.


Things To Consider With The Diffusion of the Innovation Theory

Relative Advantage: If a product is perceived to be

better than others already existing, it will diffuse quickly.

Compatibility: If the product is compatible with people’s

habits then it will diffuse fast also.

Observability: If the product can be observed easily then

it will diffuse faster.

Complexity: Products that are less complex and not

complicated will diffuse faster.


The Process Of Developing New Products

Generate an Idea

Things to do in generating an idea:

Internal Research: The firm can use their research and

development team or conduct their own research. R& D Consortia: The firm may be a part of a consortium so

that it can get information and research and assistance from

other individuals. Licensing: The firm may purchase a license to use certain

technology in the development of their idea.



Generate an Idea

Things to do in generating an idea:

Brainstorming Looking at the Competitor’s Products: This is when a

firm finds out about a new product that a competitor is bringing out or has brought out and they then use the basic idea and change things to make it their own.

Getting Input From the Customer



Test the Concept

Test the new product idea among a set of potential customers.

Develop the Product

Alpha Testing: Hypothetical testing in a managed environment

Beta Testing: Using potential consumers to test the product to determine if there are any issues



Test the Market

Pretests: Testing on customers before it is actually launched.

Market Tests: Introducing the product to a limited area. Launch the Product

Consider the price, promotion, and placement.

Consider the timing of the launch. Evaluate the Results

Analysis of the performance of the new product and making

appropriate modifications.

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The Product Life Cycle Stages

The product life cycle defines the stages that new

products move through as they enter, are

established, and ultimately leave the marketplace

and thereby offers marketers a starting point for their

strategy planning.


The Product Life Cycle Stages

Introduction Stage: The new product enters the market and

the innovators try it.

Growth Stage: The product grows and the early adapters and

early majority try it.

Maturity Stage: The product is at its’ best phase when the late

adapters try it. If a product does not mature, then it can enter a

decline stage, which ultimately leads to the product exiting the

market.

Decline Stage: This is the beginning of the ending cycle when

the product is replaced is no longer in demand, or has become

obsolete.


MARKETING SERVICES

THE INTANGIBLE PRODUCT


MARKETING SERVICES

The marketing of services is different from

marketing a product.

The Definition of a Service: Is any

intangible offering that involves an act,

a deed, a performance, or an effort.

There are four fundamental differences

involved in the marketing of services.


MARKETING SERVICES

Intangible: Is something that cannot be

touched, tasted, or seen by the consumer.

Inseparable: Services are produced and

consumed at the same time; meaning that a

service and consumption are inseparable.


MARKETING SERVICES

Variable: This refers to the quality of the

service. The more a service is demanded

and provided, the higher the variability of

the service.

Perishable: Services are considered

perishable because they cannot be stored.


MARKETING SERVICES

The Gaps Model

This highlights areas in the service industry

where customers believe they are getting

less or poorer service than they should.

These areas are the ‘gaps.’


MARKETING SERVICES

Knowledge Gap

This refers to the difference between the customers’

expectations and the company’s perceptions about what

the customers expect.

How to Reduce the Gap Understand the consumer’s expectations. Evaluate the service quality of your company. Conduct marketing research to understand the consumers.

Zone of Tolerance: This is the area between what the.

customer can tolerate and what they actually want.


MARKETING SERVICES

Standards Gap

This refers to the difference between the

company’s expectations of what the consumer

expects and the actual standards they set.

How To Reduce The Gap Training Make sure the managers are committed to

excellence.


MARKETING SERVICES

Delivery Gap

This is the difference between the firm’s set service

standards and the actual service it provides to

consumers.

How To Reduce The Gap Allow employees to make decisions about the type of

service that should be offered. Provide support services to employees so that they are

always willing to be pleasant. Use technology to increase efficiency.


MARKETING SERVICES

Communication Gap

The difference between the actual service

that the company provides and the service

that the company promotes.

How To Reduce The Gap Always deliver what you promote.


MARKETING SERVICES

Service Quality

This is the customers’ perception of how well a

service meets or exceeds their expectations, often is

different for customers to evaluate.

Voice-of-Customer Program

This is the systematic collection of customer inputs

and then the integration of that data, is used in the

managerial decisions process.


Establishing Service Quality


RELIABILITY

The ability to perform the service dependably and accurately.

RESPONSIVENESS

The willingness to help customers and provide prompt service.

ASSURANCE

The knowledge of and courtesy by employees and their ability to convey trust and confidence.

EMPATHY

The caring, individualized attention provided to customers.

TANGIBLES

The appearance of physical facilities, equipment, personnel, and communication materials.

Methods to Reducing Delivery Gaps


Empowering

Employees

Reduce

Delivery Gaps

Use of

Technology

Provide

Support and

Incentives

Methods to Reducing Delivery Gaps

How To Solve The Problem Of Bad Service Listen to the customer Find a fair solution to the problem Always resolve any problems quickly

Distributive Fairness: This is the customers perception of

the benefits he or she is receiving compared with the costs

of inconvenience and/or loss.

Procedural Fairness: This is the perceived fairness with

the resolution process of an issue or complaint.


The CREST Method

C= Calm the Customer: Listen and show empathy.

R= Repeat the Problem: Confirm your understanding of the issue.

E= Empathy: Use “empathy statements”.

S= Solve the Problem: Take action to resolve the issue.

T= Timely: Make a “timely response” to ensure the issue is resolved in a defined amount of time that is acceptable to all parties that all involved.


ESTABLISHING VALUE AND PRICING

Price for Marketing Purposes

The amount a consumer is willing to sacrifice to acquire a product or service they need or want.


The 5 C’s of Pricing

Company Objectives

The pricing strategy that the firm uses should enable them

to achieve their goals.

Profit Oriented Target Profit Pricing: this is when a company has a

target price for a certain profit. Maximizing Profits: the company identifies the price at

which it can have the most profit. Target Return Pricing: not directly concerned with profit

but rather return on investment (ROI).



Sales Oriented The Company feels that they should set a price to

increase sales and not necessarily focus on profit initially. Rather as sales increase, they will eventually hit their

target profit.

Competitor Oriented Competitive Parity: the company sets prices that are

similar to that of their competitor. Status Quo Pricing: only changes their price to meet or

beat their competitor.



Customer Oriented Invokes the concept of value. How much is the customer willing to pay for a

product or a service.



Customers

This is the stage where the company then

tries to understand the consumer’s reaction

to the different prices. This stage is very

important since it deals with the customer

who in turn creates the value.



Demand Curve: This is a chart that shows how the

demand of a product can change over time based on

the price. Typically the cheaper the product the higher

the demand, so there is an inverse correlation.

Price Elasticity: This formula measures how a

change in price can affect the quantity of the product.



Three Things That Affecting Demand

1. Changes in Income: People’s change in income can affect what they purchase and how much.

2. Substitution: There may be another product that the consumer changes to.

3. Cost Price Elasticity: This refers to the % change in price of the product.



Costs

The company has to understand cost structures so that

they know the degree to which their products will be

profitable at different prices. Variable: Costs of the product that can change such as

primary labor and raw materials. Fixed: Costs that typically do not change such as rent

and salaried labor. Total: The variable and the total cost.



Break Even Analysis

This is simply a technique by which a

company can determine the price at which

they cover all their costs.

There is no profit but also no loss.



Competition

This has a huge effect on pricing simply because

business is a competitive world. Monopoly: One company dominates the market

and has little competition. Oligopoly: A couple companies dominate the

market so they compete with each other primarily. Pure: There is no one company or some

companies that dominate the market.



Channel Members

This refers to the individuals who take the

product and channel it out into the market.

There are manufacturers, wholesalers, and

retailers. The pricing will vary from channel

to channel since typically they have variable

costs.


Gray Marketing

This is the area in marketing that is not

necessarily illegal but can cause conflicts of

interest. Most gray areas in marketing are

addressed; with clearly defined agreements

between retailers and manufactures.


Influences On Pricing

The Internet: People are now able to get more

knowledge about different products, company

different prices easily and even shop online.

The Economy: This ties back in to disposable

income. If the economy is doing well and people

have a higher disposable income then they would

be more likely to spend more.


Pricing Strategies

Pricing

Strategies Value-BasedCost-Based

Competitor-Based


Pricing Strategies

Cost Based Methods

This determines the price based on the initial cost. It is

based strictly on cost and not on the consumer’s value.

Competitor Based Methods

This uses the competitor’s price to create their own. Also

includes premium pricing which is keeping the price above

the competition so that people can think that the quality is

superior.


Pricing Strategies

Value Based Methods Improvement Value Method: this is how much more or

less a consumer is willing to pay for a product relative to their competitor.

Cost of Ownership Method: this related the total cost of owning the product over the life of the product.

Psychological Methods

This appeals to the consumer’s psyche. For example, the

consumer may purchase something if it is 6.99 vs. 7.00.


Pricing Strategies

Product Line Pricing

This refers to when you have a line of

products for example at a car wash.

Promotional Pricing

Offering some type of promotion, such as

buy one get one free.


Pricing Strategies

Geographical Pricing

This is varying the price based on location. This would be

based on how rare the product is or perhaps shipping

costs for the manufacturers to get the raw materials.

Product Bundle Pricing

This is offering a package. Often companies will do this to

either get rid of a group products or a single product or

simply to increase the dollar value of the sale.


Psychological Factors that Affect Prices

This is the psychological process in which

the buyer is influence and reacts to prices.

Consumers assign meaning of prices by

placing them into categories. (expensive, a

good deal, cheap, overpriced, or fair)


Psychological Factors that Affect Prices

Reference Prices: Is the price in with buyers compare

the actual selling price of the product, which allows

the consumer to compare prices.

Every-Day Low Prices: Companies use this strategy

to let consumers believe that their prices are always

lower so it attracts the mind.

Price vs. Quality: The consumer will pay the price

based on what they feel the value and quality are.


Pricing New Products

Price Skimming: Innovators and early

adapters would be willing to pay a higher

price to get the product; therefore the initial

price is high.

Market Penetration Pricing: Setting the

initial price low as an introductory price.


Pricing Tactics

Seasonal Discounts: An additional

reduction based on the season.

Quantity Discounts: Buy more and you

pay less!

Price Lining: Establishing a range of prices

and is effective with high end products since

the lower price would still be perceived as a

great product.


Pricing Tactics

Price Bundling: Bundle the products

for one price.

Markdowns: Reductions on the initial

selling price of the product.

Coupons and Rebates: The company

gives coupons in the newspapers.


Legality and Ethics in Pricing

Deception: Always tell the truth in

advertising.

Bait and Switch: The store advertises a

product at a certain price and then lures the

consumer in and attempts to switch the

product to a higher price product.


Legality and Ethics in Pricing

Predatory Pricing: When a company uses

a very low price with the intent to send their

competitor out of business.

Price Discrimination: Selling a product at a

different price to different people or channels.

Price Fixing: Collaborating with other companies

to fix the price so the consumer has no choice.


RETAILING


What is Retailing?This is a set of business activities that add value to products and services sold to the consumers for their personal or family use.

What Is The Difference BetweenRetailing And Wholesaling?

Wholesaling involves buying the

item, storing and handling the item

and often does not add value as far

as customer service.


Creating Value Through RetailingUsing the Marketing Mix

Product Assortments give customers a choice. Companies have developed their own line of

products.

Price Aligning the price with the marketing image. Manufactures consider prices when selling to

retailers so that they can both be competitive in their own marketplace.


Creating Value Through RetailingUsing the Marketing Mix

Promotion Retailers specialize in promotion. Consumers have access to store credit, coupons

and gift cards. Retailers invest in display items to attract the

consumer.

Placement Convenience is the key to getting the consumer. The three most important things in retailing are

“location, location, location”.


Types of Retailers


Supermarket

Supercenter

Convenience

Warehouse Club

Drug

Category Specialist

Full-Line Discount

Off-Price

Department

Specialty

Extreme Value

Food Retailers General Merchandise

Channels for Selling to Consumers

Store Channel

Brick and mortar retail stores offer consumers several

benefits they cannot get when they shop online. • Browsing• Touching and Felling Products• Personal Service• Cash and Credit Payment• Entertainment and Social Experiences• Immediate Gratification• Risk Reduction



Catalog Channel

This channel provides specialty items that

cannot be purchased at the store.

Other Benefits Include: • Convenience• Information• Safety



Internet Channel

The internet provides several benefits to the

purchaser. • Broader Selection• More Information to Evaluate Merchandise• Personalization • Convenience


Integrated Marketing Communications (IMC)

This refers to the Promotion aspect of the

marketing mix. This process includes,

general advertising, personal selling,

sales promotion, public relations, direct

marketing efforts, electronic media and

public contributions.


Integrated Marketing Communications (IMC)


Customer

Focused

Communication

Channel Results

IMC

Different Elements of IMC Strategy

Advertising: Advertising is a paid form of

communication from an identifiable source

delivered through a communication channel.

Personal Selling: Two-way communication

between a buyer and seller.

Sales Promotion: Special incentives or

programs that encourage sales such as

coupons, rebates, samples etc.


Different Elements of IMC Strategy

Direct Marketing: The message is delivered

directly to the consumer such as emails or

phone texts.

Public Relations: The firm uses this to

promote themselves and the product without

paying for advertising.

Electronic Media: The company uses the

internet to allow the consumer the opportunity

to test the product such as with games.


Legalities in IMC

Commercial Speech: A message with an

economic motivation to promote a product

to persuade someone to purchase it.

Commercial speeches have to be

substantiated.

Non-Commercial Speech: A message

without an economic motivation.


The Communication Process

The Sender: This refers to the actual

company or the entity wanting to send

the message.

The Transmitter/ The Encoder: This

refers to the person or agency that the

sender goes to in order to transmit the

message. The transmitter then encodes

the message into a deliverable format.



The Communication Channel: This is

the channel of communication such as

television, radio or the newspapers.

The Receiver/ The Decoder: This is the

consumer on the other end getting the

message and decoding it so that they

understand the message.



Other Considerations

Noise: This refers to interference when

the message is relayed.

Feedback: This allows the receiver to

communicate with the sender so that

the sender knows if the message was

received.


The AIDA Model

Awareness: Make the consumer aware

of the product and the company. Get their

attention.

Interest: Use communications to increase

the consumer’s interest in the product

once he or she is aware. Make the

consumer like the product.


The AIDA Model

Desire: After getting the consumer

interested in the product, this phase

should make the consumer feel that they

have to have it. Make the consumer want

the product.

Action: Once the consumer likes and

wants the product, the goal of this phase

if for the consumer to purchase the product.


The AIDA Model


Awareness

Do Feel Think

Interest

DesireAction

ADVERTISING


What is Advertising?

This is a paid form of communication delivered

using some different types of media, that we

communicate your message about your

organization, products, services, or idea,

designed to persuade the receive to take some

type of action, now or in the future.


The Process Of Planning For Advertising

Step 1- Identify The Target Audience

It is always a key component to determining who you are

trying to market the product or service to.

Step 2 - Set Advertising Objectives To Inform/Informative Advertising: This type simply informs

consumers about the product and the brand. To Persuade/Persuasive Advertising: This type is to

persuade the consumer to purchase after they are aware

of the brand.



Step 2 - Set Advertising Objectives To Remind/Reminder Advertising: This type simply

reminds people that the product is available.

It Can Be Used For Two Things: To remind people about

products that are doing well and simply for them to think

about it or for products that have not been doing too well

to generate some new interest.



Step 3 - Determine the Budget Consider the role that advertising will play or contribute

to the achievement of the organizational objectives. The product cycle should be considered when

determining the budget. The nature of the market and the products influence

should also be considered.



Step 4 - Convey the Message The marketer determines what they want to convey. Ensure that the message you are coding is able to be

decoded accurately. Ensure that you appeal to the senses of the consumer.

There Are Two Senses

1) Informative

2) Emotional



Step 5 - Evaluate And Select The Form Of Media Ensure that you select the appropriate media for

the market you are trying to target. Try to determine how often you would like the ad

to appear to the audience.



Step 6 - Create the Ad

There are several key components to creating an ad for print. The Heading: This is the type of text, and the font size. The Body Copy: This is the actual text portion of the ad. The Background: Or backdrop for the ad and selection of

color(s). The Foreground: This is everything that appears on top of

the background. The Branding: This is the logo/symbol that identifies the

sponsor of the ad.



Step 7 - Assess The Impact

The effectiveness of the ad campaign should be

assessed before, during and after the ad has run.

Pretesting: This is the assessments that are

completed before the ad campaign is implemented.

Tracking: Monitoring KPIs during the campaign.

Post-Testing: This is the evaluation of the

campaign’s impact after it has been implemented.


Types Of Media Used In Advertising

Outdoor Ads/Posters/Billboards Television Radio Magazines Newspapers Internet/Web Engines Direct Mail Cinema


Promoting Sales

Use of Coupons Give Deals: Short term reduction in price. Have Contests: This usually is based on the consumer

doing something or having some skill. Do Sweepstakes: The consumer will simply have to fill

out a form. Provide Samples: Let the consumer try it for free. Create Loyalty Programs: This can be tied in with the use

of credit cards. Use Product Placement: Such as putting the product in a

movie or TV show to create appeal.


PERSONAL SELLING AND SALES

What Is Personal Selling?

This occurs when an individual salesperson sells

a product or service to a client. It involves a two way flow of communications. The salespeople match the benefits of what they

are offering to the specific needs of the clients. The purchase tends to involve large sums of

money.



Relationship Selling

This is maintaining and building the relationship over time

once it has been established.

The Value of Personal Selling The sales person can educate the consumer and also

provide advice. The salesperson saves the consumer time and makes

the purchasing process easy.


The 6 Stage Personal Selling Process

Prospecting

This refers to finding prospects or potential

consumers. This can be done either by purchasing

leads from a private company or generating them

from the community such as trade shows.



Making The First Contact Know the potential client if possible before you

make the initial contact. Set an objective for the call…what is the purpose…

to set an appointment etc? Ensure that you state the purpose of your call when

you make it. If you had set a time before for the call, then make

sure you are on time.



The Actual Sales Call This can be the actual sales presentation.

Handling Objections Be prepared to answer questions.

Closing the Sale Ask for the business at the appropriate time.

The Follow Up After the Sale Always have a follow up plan. Use a (CRM) System.



Ethical Issues With Personal Selling Treat everyone fairly and equally. Always tell the truth.



Things To Consider When Managing A Sales

Department Recruiting The Correct Sales People: Not everyone

can do any job. Training: Be sure that before the sales person is in

action, that proper training is provided. Setting Objectives: It is important that each

salesperson knows their goals. Provide Support Personnel


Q & A


Marketing with NLP

Business

Transcript of Marketing with NLP