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Principles of Marketing
Dina El Tabey
Mariam Abou-Youssef
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The Course Objectives
LEARN PRACTICAL MARKETING KNOWLEDGE AND PRACTICES Module 1 (Day 1)
• Marketing Definition • STP, Principle of Real World Mktg.
Module 2 (Day 2 & 3)• Marketing Tools
• From Online Marketing to Direct Marketing Module 3 (Day 4)
• Marketing Program – Workshop • Learn How To Design a Marketing Program
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Today’s Objectives
What is marketing? STP The Marketing Mix Principles of real world marketing Exercise
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What is Marketing? It is not just “selling and advertising”; It is the process
by which companies create value for customers and build strong customer relationships in order to capture value from customers in return.
“The Whole Firm Taken From A Customer Perspective” Peter Drucker
EVERYTHING THAT TOUCHES THE CONSUMER IS MARKETING
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What Marketing Does?
Reach customers Motivate Them To Buy Use AND REBUY The product
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What Marketers Do?
Reach customers Motivate Them To Buy Use AND REBUY The product
Marketers Should March To The Drums Of The Customers
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STP (Segmentation, Targeting &Positioning)
Market segmentation
1. Identify bases for segmenting the market.
2. Develop segment profiles
Target marketing
3. Develop measure of segment attractiveness
4. Select target segments.
Market positioning
5. Develop positioning (differentiation) for target segments.
6. Develop a marketing mix for each segment.
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1. Market segmentation
Dividing a market into smaller groups of buyers distinct needs, characteristics, or behavior who might require separate products or marketing mixes
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Market segmentation Buyers differ in
WantsResourcesLocationsBuying attitudesBuying practices
Through market segmentation, companies divide large, heterogeneous (different) markets into smaller segments that can be reached more efficiently and effectively with products and services that match their unique needs
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Geographic segmentation
Dividing a market into different geographical units such as nations, states, regions, counties, cities or neighborhoods
Al-wasset classifieds (maadi)
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Demographic segmentation
Dividing the market into groups based on demographic variables such as age, gender, family size, family life cycle, income, occupation, education, religion, race and nationality
Most popular because our needs, wants and usage rates depend on the demographics
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Age and life cycle segmentation
Dividing a market into different age and life cycle groups
Kids (corn flakes), adults, magazines (teen stuff)
Gender segmentation Dividing a market into different
groups based on gender Clothing, cosmetics, perfumes
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Income segmentation
Dividing the market into different income groups
Cars, financial services
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Psychographic segmentation
Dividing a market into different groups based on social class, lifestyle or personality characteristics
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Behavioral segmentation
Dividing a market into groups based on consumer knowledge, attitude, use, or response to a product
Occasion segmentationDividing the market into groups
according to occasions when buyers get the idea to buy
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Behavioral segmentation (cont’d)
Benefit sought segmentationDividing the market into groups
according to the different benefits that consumers seek from the product (detergent)
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Using multiple segmentation bases
Using multiple segmentation bases in an effort to identify smaller, better defined target groups
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Requirements for effective segmentation
Measurable Accessible Differentiable (segment is unique) Actionable (can perform marketing
mix to reach this segment)
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STP
Market segmentation
1. Identify bases for segmenting the market.
2. Develop segment profiles
Target marketing
3. Develop measure of segment attractiveness
4. Select target segments.
Market positioning
5. Develop positioning (differentiation) for target segments.
6. Develop a marketing mix for each segment.
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Target marketing
The process of evaluating each market segment’s attractiveness and selecting one or more segments to enter
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Evaluating market segments
Segment size Growth Segment attractiveness Company objectives and resources Competitors Buying power Supplier power
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Selecting target market segments
Target marketA set of buyers sharing common needs or
characteristics that the company decides to serve
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Targeting Strategies
Undifferentiated Strategy
One marketing mix for the whole market
Concentrated (niche) Strategy
One marketing mix and one segment
Differentiation Strategy
Two marketing mix and 2 different segment
Chipsy BMW
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STP
Market segmentation
1. Identify bases for segmenting the market.
2. Develop segment profiles
Target marketing
3. Develop measure of segment attractiveness
4. Select target segments.
Market positioning
5. Develop positioning (differentiation) for target segments.
6. Develop a marketing mix for each segment.
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Product positioning
The way that product is defined by consumers on important attributes - the place the product occupies in consumer’s minds relative to competing products
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Perceptual Positioning Map for AutomobilesPerceptual Positioning Map for Automobiles
•
•••
•
•••
••
•
•
••• •
•
• •Volvo 850R
Chrysler LHS
Buick Park Avenue
Oldsmobile L35
Honda Accord
Nissan Sentra
Plymouth VoyagerDodge Caravan
Geo Metro
Kia Sephia
Dodge Neon
Saturn SC2
Porsche 914
Mercedes 400SE
Lexus LS400
Jeep Grand CherokeeAcura Integra
Ford Taurus
Honda Civic
Stylish, prestigious, distinctive
Practical, common, economical
Staid, conservative, older
Fun, sporty,
fast
TM3 TM2
TM1
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Developing the marketing mix
Marketing mix: the set of controllable tactical marketing tools: product, price, place and promotion that the firm blends to produce the response it wants in the target market
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Consumer productsPrinciples of Real World Marketing
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Principles of Real World Marketing
Your Customers Aren’t Listening To You
Everybody Else Is Shouting At Your Customers
The Rest Of Your Organization thinks you are crazy BUT
You Cant execute your program without the rest of the company
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Principles of Real World Marketing
The More You Give; The More You Get Being Good Is Never Good Enough;
You Have To Be Better Marketing Should Be The Most Creative
and Most Logical Part Of Your Business Everything Is Marketing
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Integrated Marketing Communications (IMC)
The concept under which a company carefully integrates and coordinates its many communications channels to deliver a clear, consistent, and compelling message about the organization and its products
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IMC
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Marketing communications mix - promotion mix
The mix of AdvertisingPersonal sellingSales promotionPublic relationsDirect Marketing
That the company uses
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a. Advertising
Any paid form of non-personal presentation and promotion of ideas, goods, or services
Advertising toolsPrint (newspapers, magazines)TVRadioOutdoorOnline
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1. Setting advertising objectives A specific communication task to be
accomplished with a specific target audience during a specific period of time
ObjectivesInformative (new product category)Persuading (when competition
increases, comparative advertising, comparative advertising AUDI ad)
Reminding (coca cola, Pepsi)
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2. Developing advertising strategya. Creating advertising messages
Message execution Slice of life: one or more “typical” people
using the product in a normal setting. Samna and Oil ads)
Lifestyle: how a product fits in with a particular lifestyle. Nescafe
Fantasy: creates fantasy around the product or its use. Galaxy (girl in the big chair), 7up tropical
Musical: one or more people or cartoon characters singing about the product. (Sunsilk)
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Message executionTechnical expertise: shows the
company’s expertise in making the product. Chipsy
Scientific evidence: presents surveys or scientific evidence that the brand is better or better liked than one or more other brands. Crest and the egg ad
Testimonial evidence or endorsement Highly believable or likeable source endorsing the product –Celebrity- Nancy Agram
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2. Developing advertising strategy b. Selecting advertising media
Deciding on reach, frequencyReach: measure of the percentage of people in
the target market who are exposed to the ad campaign during a given period of time
Frequency: measure of how many times the average person in the target market is exposed to the message
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Choose Your Media Type
QuestionHow to choose the best medium?
AnswerWhatever Works for your campaign and
reaches your target market • Primary Medium• Secondary Medium • Spread your budget equally on more than
one medium
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Profiles of major media types
Print - Newspaper
Flexibility; timeliness; good local marketcoverage; broad acceptability; believability
Short life; poor production quality
Television Good mass-market coverage; low cost per exposure; combines sight, sound, and motion; appealing to the senses
High absolute cost; high clutter; less audience selectivity
Radio Good local acceptance; high geographic and demographic selectivity; low cost
Audio only; low attention (“half heard”); fragmented audiences
Print - Magazine
High geographic and demographic selectivity; credibility and prestige; quality production; long life; good pass-along
high cost; no guarantee of position
Outdoor Flexibility; high repeat exposure; low cost; low message competition; good positional selectivity
Little audience selectivity; creative limitations
Online High selectivity; low cost; immediacy; interactive capabilities
Small, demographically skewed audience; low impact; audience controls exposure
Medium AdvantagesMedium Advantages Limitations Limitations
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Print Advertising (Newspapers, Magazines) Most Advertisers budget more for print than any other
media Works mainly to promote sales promotions Anatomy:
Headline Sub headline Copy – choose the font that serves the message Visual Caption Trademark Signature Slogan
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Exercise
Each Team chooses a print ad from the newspaper or magazine and analyze it
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Television
Used When You Need To Evoke Emotions – surprise, anxiety, excitement, happiness, …
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Radio
Rely On Sounds – choose cool sound effect, interesting voice, catchy musical phrase, …
Choose One Strong Idea Talk To Your Market Right Away – i.e.
if you want to advertise for salon’s service; start right away with ex. :”not another bad hair day”
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Outdoor – Billboards, Banners and Signs It must be read in a hurry It is geographically specific It directs people to your business location Placing it in front of competitor location IS
SMART Design should include 2 main sections: 1-
Header to catch attention from far, 2- essential information
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Outdoor – Billboards, Banners and Signs
Forms:VinylHand PaintedWoodMetalLight BoxesElectronic Display
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Online Advertising
Types:Website = company brochure Banner Ads = billboard where you use
your logo, one simple message and max. couple lines of body copy
N.B• Refresh Your Content Regularly • Deliver fascinating and attractive content
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Other Forms of Indirect Advertising
Point Of Purchase POP FlagsDanglersRoll ups & pop ups
Word Of MouthVirtual WOMFace To Face
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b. Sales promotion
Short-term incentives to encourage the purchase or sale of a product or service
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Major sales promotion tools for consumers
Sample: a small amount of a product offered to customers for trial. (perfumes)
Coupon: certificate that gives buyers a saving when they purchase a specified product
Price off (cents-off deal): reduced price that is marked by the producer directly on the label or package. (10 instead of 12)
Premiums: prizes, gifts consumers receive when purchasing products. (shampoo with shower gel, vodafone)
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Major sales promotion tools for consumers (cont’d)
Contests and sweepstakesContests: solve questions and you win
something (who would win the million)Sweepstakes: depend on luck
Bonus packs: additional or extra number of items is placed in a special product package (3 with price of 2, 20%extra)
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Major sales promotion tools for trade
Discount: a straight reduction in price on purchases during a stated period of time
Allowances: promotional money paid by manufacturers to retailers in return for an agreement to feature the manufacturer's products in some way
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c. Public relations
Building good relations with the company’s various publics by obtaining favorable publicity, building up a good “corporate image”, and handling or heading off unfavorable rumors, stories, and events
It is unpaid advertising PR tools
Press releases Sponsorships (Mc Donald’s and the hospital
53753) Special events (Vodafone and the charity
complex)
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d. Personal selling
Personal presentation by the firm’s sales force for the purpose of making sales and building customer relationships
Personal selling toolsPersonal presentation Trade shows (exhibitions and fairs.
Le marche)
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e. Direct marketing
Direct communications with carefully targeted individual consumers-the use of telephone, mail, fax, e-mail, the internet, and other tools to communicate directly with specific consumers
Direct marketingSending cataloguesTelemarketing
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Push strategy
A promotion strategy that calls for using the sales force and trade promotion to push the product through channels.
The producer promotes the product to wholesalers, the wholesalers promote to retailers, and the retailers promote to consumers
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Pull strategy
A promotion strategy that calls for spending a lot on advertising and consumer promotion to build up consumer demand.
If the strategy is successful, consumers will ask their retailers for the product, the retailers will ask the wholesalers, and the wholesalers will ask the producers
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Push Vs Pull strategy
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1. Affordable method
Setting the promotion budget at a level management thinks the company can afford
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2. Percentage of sales method
Setting the promotion budget at a certain percentage of current or forecasted sales or as a percentage of unit sales price
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3. Competitive-parity method
Setting the promotion budget to match competitors’ outlays
Get Data from reports such as PARCMobinil and VodafonePepsi and coca cola
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4. Objective and task method
Developing the promotion budget byDefining specific objectivesDetermining the tasks that must be
preformed to achieve these objectivesEstimating the costs of performing
these tasks The sum of these costs is the
proposed promotion budget