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Transcript of Marketing Analysis
Design Customer-Driven Marketing Strategy (STP)
- Dividing based on distinct needs.
- Bases of segmentation
- Segment profiles
Marketing Analysis (3Cs)
Consumer: needs and preferences
Company: Strategic planning
- Evaluating the attractiveness of each market segment.
- Selecting one or more segments to target.
- Clear and distinctive and desirable position.
- Differentiation with greater value.
- To achieve competitive advantage.
Develop Marketing Tactics (Mix) : '4Ps'
Lecture 5 (after midterm)
Agenda: Product and Branding
2. Product Mix
3. Types of products
4. New product
5. Product life cycle
3-levels of product:
1. core benefit
2. actual product: brand name, quality, packaging, design, features
3. augmented product: delivery and credit, installation, after-sale service, warranty
Product: Goods and services
group of product that:
1) function in a similar manner; 2) are sold to the same customer groups; 3) market through he same types of outlets; and/or 4) fall within given price ranges
Production Line Length:
Line stretching: adding different priced products than the existing ones. e.g. Marriott
Line Filling: adding more items within the present price range. e.g. Listerine
all the product lines and items that a particular seller offers for sale:
width: # of product lines
length: # of products in lines
depth: # of versions of each product carried
consistency: how closely related the product lines are
3. Types of products:
Min Buying Effort, Little Comparison
Readily Available (easy to find in stores)
e.g.: daily food
Higher Price than convenience good
Personal Selling, Advertising
e.g.: cloth, car, furniture
Strong Brand Loyalty
Special Purchase Effort, Little Comparison, Low Price Sensitivity
Carefully Targeted Promotions
e.g.: luxury goods
Little Product Awareness and Knowledge/ sometimes negative interest
Aggressive Advertising and Personal Selling
e.g.: life insurance; preplanned funeral services; new innovations
4. what's a 'New Product'?
New to the company:
- but know-how and tech. exists in the marketplace
- acquisition or development
New to the market:
- new way of giving existing benefits
- new benefits
Why so many flops?
No customer value
No Systematic Development process
Gillette Guard Success
Price has been lowered, tailored for Indian people.
- Don't slap a foreign label on a U.S. product
- Rethink product design and cost (price) to create unique value for them
*PLC applies to product category, a product form, or a brand
why do companies build brands?
Source of competitive advantage
- signal of quality level
- promotional efficiency
- helps launch new products
reduces prices competition (brand loyalty)
Source of financial returns: licensing
Beliefs and Values
1. A consumer buys entire experience (augmented product), not just “actual product”, and core benefit.
2. Companies with differentiated strategies would provide line (or lines) of products to satisfy different needs.
3. Successful new products provides growth.
4. Marketing strategy depend on types of products and stages in PLC.
5. Branding should often go beyond features and benefits.
2. Product Mix
state of felt deprivation
needs shaped by culture and the individual (burger vs. rice)
wants backed by buying power
Marketing is the process of determining customer wants and then developing a product to satisfy their needs. It is externally focused.
Selling entails producing a product and then trying to persuade customers to purchase it -- in effect, trying to alter consumer demand. It is internally focused.
Take-Aways (Lecture 1)
1. Key Principle: “A deep understanding of customer needs is the starting point of any marketing (and other strategic) decisions.”
2. What is marketing?
Starts with customers and their needs
Managing profitable customer relationships.
3. Overcoming marketing myopia
Focus on needs
Importance of corporate-wide “customer orientation” – Needs stay longer than products.
- Star: Build-- increase mark share
- Cash Cow: Hold-- preserve market share
- ?: Build or harvest
- Dog: Divest
Build Profitable Relationships
Customer Relationship Management (CRM)
What is Marketing Research?
- Collecting info to understand consumer's needs, to support decision making.
- Info: competitor and consumers
- Decisions: STP, 4P's
Research on Competitors--> learn from competitors:
- other's new products
- experience competitor's services
1. Secondary research (data initially collected for other purposes)
2. Primary research
Types of Primary Research
1. Observation Research
- immersed into consumer's life for deeper insights.
- developing insights for creative ideas (new products/ communications)
- question participants about their knowledge, preference, and intentions
- obtain descriptive data (think about research lab)
- design 'matched' groups and give different treatments (e.g., advertisement, prices)
- obtain cause-and-effect results
- control your testing in/dependent variance
Marketing Growth Matrix
Consumer Behavior: Psychology Factors (Lecture 3)
- Freud Theory: hidden and subconscious
- Maslow's hierarchy of needs
- is the process by which people select, organize, and interpret information
Attitudes are difficult to change
Companies usually try to fit their products to existing attitudes rather than trying to change attitudes
Adoption of new product
New product: new goods/ service/ idea
individual first hear about an innovation,
-->become a regular user of the product (durable/ non-durable good).
Influence of product characteristics on rate of adoption
the degree to which the innovation appears superior to existing products
the degree to which the innovation fits the values and experiences of potential consumers
the degree to which the innovations is difficult to understand or use
the degree to which the innovation may be tried on a limited basis
the degree to which the results of using the innovation can be observed or described by other
Not only adoption time matters; adopters’ characteristics are important too!
Many factors influence adoption
- Facebook scores high in all 5 product characteristics that affect adoption rate
- Competition, innovation, network effects
- The marketing mix (4 Ps)
For Facebook, “product” and “place” are factors; “promotion” and “price” don’t play a prominent role
Lecture 3 take away
Key Principle: Good marketing calls for a deep understanding of customer needs, and how need-fulfilling process can be shaped by marketing tactics.
Needs, perception, attitudes, and adoption decisions.
Base of Segment
- most popular base of segmenting
- including gender, age, ethnicity, income, education, employment status, family status.
- base on social class, lifestyle, or personality
- usage frequency, usage rate, loyalty, new vs. existing customers
Using multiple segmentation bases!
How to evaluate the segment?
Size, purchasing power, and profile of segment
Can be reached and served
Large, profitable enough to serve; sustainable over
Mutually exclusive; similar needs within segments
Effective programs can be developed
e.g., M&M personalization chocolate; NIKE self design shoes
limited comp. resources;
large market share for the targeted segments
Positioning by Benefits
e.g., Volvo: Safety
Positioning by usage situation (&benefits)
e.g., NyQuil: nighttime cold medicine;
Tylenol: emphasizes pain relief
Lecture 4 take-aways
Wants vs. Needs --> Marketing Myopia
the degree to which innovation appears superior to existing product
Oct. 07 Guest Speaker
Case of 'AMD'
- 'Age- Related Macular' Degeneration.
- foundational study: slow the progress of AMD.
- launch team: good marketer with good leadership abilities, and good team facilitators.
who have AMD; women majority; 60-80 years old.
strong desire for sight; scared being blind.
high willingness to pay for AMD compliance; loyal; high usage rate; health adviser's help
1) Core benefit:
independence; improving quality of life
2) Reasons to believe:
based on AREDS study and by B&L
3) Personality (culture/image):
authoritative and scientific
"5 Creative Concepts":
effectively communicates the 'position' of the brand to our target customer and will perform the best.
value based/ cost based
Placing (Distribution) Strategy:
- direct: website
- via eye care professional associations
- through traditional retail channels
- credibility followed by broad retail distribution