Download - Crash Course in Basic Marketing Sep 2011

8/2/2019 Crash Course in Basic Marketing Sep 2011

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Recap workshopin

Marketing

Facilitated by

Prof. Suresh Vishwanath
http://lg/LG%20PRES.pptxhttp://lg/LG%20PRES.pptx


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2

Prof. Suresh Vishwanath

Industry, Training and Teaching experience of over 34 yearsInternational experience including that of General Manager(Marketing) and as a Group Managing Director of an MNC;

Professional pursuits have entailed presence in number ofCountries & Cities in India, Middle East, Far-East, Africa, US,UK, The Continent and Scandinavia;

Continues to serve on the board of a number of companiesin Europe and Africa; and

He was Dean at SIBM & NICMAR. Currently he is a visitingfaculty at a number of B-Schools in India and abroad

B Sc (Hons), MA (Psy & SW), Post Graduate from XLRI & Fellow

Member-American Psychological Association & Worldwide Association of

Business Coaches


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Defining Marketing

for the 21

st

Century

1

Marketing Management

A South Asian Perspective, 13th

ed


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Copyright 2009 Dorling

Kindersley (India) Pvt. Ltd.

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What is Marketing Management?

Marketingmanagement is the

art and science

of choosing target marketsand getting, keeping, and growing

customers through

creating, delivering, and communicatingsuperior customer value.


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What is Marketed?

Goods

Services

Events & Experiences

Persons

Places & Properties

Organizations

Information

Ideas


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Functions of CMOs

Strengthening the brands

Measuring marketing effectiveness

Driving new product development based oncustomer needs

Gathering meaningful customer insights

Utilizing new marketing technology


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Figure 1.5 The Four Ps


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Marketing Management Tasks

Develop market strategies and plans

Capture marketing insights

Connect with customers

Build strong brands

Shape market offerings

Deliver value

Communicate value

Create long-term growth


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Developing Marketing

Strategies and Plans

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Figure 2.7 The Business Unit

Strategic Planning Process


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SWOT Analysis

Strengths

Weaknesses

Opportunities

Threats


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Market Opportunity Analysis (MOA)

Can the benefits involved in the opportunity be

articulated convincingly to a defined target market?

Can the target market be located and reached with

cost-effective media and trade channels? Does the company possess or have access to the

critical capabilities and resources needed to deliver

the customer benefits?


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Market Opportunity Analysis (MOA) (cont.)

Can the company deliver the benefits better

than any actual or potential competitors?

Will the financial rate of return meet or

exceed the companys required threshold for

investment?


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Figure 2.8 Opportunity Matrix


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Figure 2.8 Threat Matrix


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Porters Generic Strategies

Overall Cost Leadership

Differentiation

Focus


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Marketing Plan Contents

Executive summary

Table of contents

Situation analysis

Marketing strategy

Financial projections

Implementation controls


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Evaluating a Marketing Plan

Is the plan simple?

Is the plan specific?

Is the plan realistic?

Is the plan complete?


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Gathering Information and

Scanning the Environment

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ed


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What is a

Marketing Information System (MIS)?

A marketing information system consists of

people, equipment, and procedures to gather,

sort, analyze, evaluate, and distribute needed,

timely, and accurate information tomarketing decision makers.


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Table 3.1 Information Needs Probes

What decisions do you regularly make?

What information do you need to make thesedecisions?

What information do you regularly get?

What special studies do you periodically request? What information would you want that you are

not getting now?

What are the four most helpful improvements

that could be made in the present marketinginformation system?


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Sources of Competitive Information

Independent customer goods and service review

forums

Distributor or sales agent feedback sites

Combination sites offering customer reviews andexpert opinions

Customer complaint sites

Public blogs


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Copyright 2009 Dorling Kindersley (India) Pvt. Ltd. 3-23

Needs and Trends

Fad

Trend

Megatrend
http://www.itunes.com/


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Trends Shaping the

Business Landscape

Profound shifts in centers of

economic activity

Increases in public-sector

activity

Change in consumer

landscape

Technological connectivity

Scarcity of well-trained

talent

Increase in demand for

natural resources

Emergence of new global

industry structures

Ubiquitous access to

information

Management shifts from art

to science

Increase in scrutiny of big

business practices


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Environmental Forces

Demographic

EconomicPolitical-Legal

Socio-CulturalTechnological

Natural


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Conducting

Marketing Research and

Forecasting Demand

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What is Marketing Research?

Marketing research is the systematic design,

collection, analysis, and reporting of data and

findings relevant to a specific marketing

situation facing the company.


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Types of Marketing Research Firms

Syndicated-

serviceCustom

Specialty-

line


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The Marketing Research Process

Define the problem

Develop research plan

Collect information

Analyze information

Present findings

Make

decision


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Step 2: Develop the Research Plan

Data

Sources

Contact

Methods

Research

Instruments

Sampling

Plan

Research

Approach


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Research Approaches

Observation

Focus Group

Survey

Behavioral Data

Experimentation

Ethnographic


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Pros and Cons of Online Research

Advantages

Inexpensive

Fast

Accuracy of data, even

for sensitive questions

Versatility

Disadvantages

Small samples

Skewed samples

Technological problems

Inconsistencies


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What is a

Marketing Decision Support System (MDSS)?

A marketing decision support system is a

coordinated collection of data, systems,

tools, and techniques with supporting

hardware and software by which an

organization gathers and interprets

relevant information from business and

environment and turns it into a basis formarketing action.


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Barriers Limiting the Use of

Marketing Research

A narrow conception of the research

Uneven caliber of researchers

Poor framing of the problem Late and occasionally erroneous findings

Personality and presentational differences


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What is Marketing Metrics?

Marketing metrics is the set of measures that

helps marketers quantify, compare, and

interpret marketing performance.


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Table 4.4 Marketing Metrics

External Awareness

Market share

Relative price

Number of complaints

Customer satisfaction

Distribution

Total number ofcustomers

Loyalty

Internal Awareness of goals

Commitment to goals

Active support

Resource adequacy

Staffing levels

Desire to learn

Willingness to change Freedom to fail

Autonomy


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What is Marketing-Mix Modeling?

Marketing-mix models analyze data from a

variety of sources, such as retailer scanner

data, company shipment data, pricing, media,

and promotion spending data, to understandmore precisely the effects of specific

marketing activities.


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Marketing Dashboards

A customer-performance scorecardrecords how well the company is doingyear after year on customer-basedmeasures.

A stakeholder-performance scorecardtracks the satisfaction of variousconstituencies who have a critical interest

in and impact on the companysperformance including employees,suppliers, banks, distributors, retailers, andstockholders.


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Table 4.5 Sample Customer-Performance Scorecard

Measures

% of new customers to average #

% of lost customers to average #

% of win-back customers to average #

% of customers in various levels of satisfaction

% of customers who would repurchase

% of target market members with brand recall

% of customers who say brand is most preferred


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Figure 4.3 Example of a

Marketing Dashboard


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The Measures of Market Demand

Potential

Market

Penetrated

Market

Target

Market

Available

Market


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Vocabulary for Demand Measurement

Market demand

Market forecast

Market potential

Company demand

Company sales forecast

Company sales potential


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Figure 4.4 Ninety Types of

Demand Measurement


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Figure 4.5

Market Demand Functions


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Figure 4.5

Market Demand Functions


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Product Penetration Percentage

H C W E i
http://www.tivo.com/jump/redir.asp?main=HPNav&sub=HP_Redirect&URL=/0.0.asphttp://www.tivo.com/


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How Can We Estimate

Current Demand?

Total market potential

Area market potential

Market buildup method

Multiple-factor index method


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Estimating Future Demand

Survey of Buyers Intentions

Composite of Sales Force Opinions

Expert Opinion Past-Sales Analysis

Market-Test Method


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Creating Customer Value,

Satisfaction,

and Loyalty

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Marketing ManagementA South Asian Perspective, 13th ed


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Figure 5.2 Determinants of

Customer Perceived Value

Image benefit Psychological cost

Personal benefit Energy cost

Services benefit Time cost

Product benefit Monetary cost

Total customer benefit Total customer cost


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Steps in a Customer Value Analysis

Identify major attributes and benefits thatcustomers value

Assess the qualitative importance of

different attributes and benefits Assess the companys and competitors

performances on the different customervalues against rated importance

Examine ratings of specific segments

Monitor customer values over time


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What is Loyalty?

Loyalty is a deeply held commitment to re-buy

or re-patronize a preferred product or service

in the future despite situational influences

and marketing efforts having the potential tocause switching behavior.


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Measuring Satisfaction

Periodic Surveys

Customer Loss Rate

Mystery Shoppers

Monitor Competitive

Performance


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What is Quality?

Quality is the totality of features and

characteristics of a product orservice that bear on its

ability to satisfy

stated or implied needs.


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Estimating Lifetime Value

Annual customer revenue: Rs.500

Average number of loyal years: 20

Company profit margin: 10%

Customer lifetime value: Rs.1000


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What is Customer Relationship Management?

CRM is the process of carefully managing

detailed information about individual

customers and all customer touchpoints

to maximize customer loyalty.


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Framework for CRM

Identify prospects and customers

Differentiate customers by needs

and value to company

Interact to improve knowledge

Customize for each customer


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Customer Retention

Acquisition of customers can cost five times more

than retaining current customers.

The average customer loses 10% of its customers

each year. A 5% reduction to the customer defection rate can

increase profits by 25% to 85%.

The customer profit rate increases over the life of a

retained customer.

Fi 5 5 Th C


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Figure 5.5 The Customer

Development Process

Prospects

Suspects

Disqualified

First-time

customersRepeat

customersClients Members

PartnersEx-customers


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Analyzing

Consumer Markets

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Fi 6 1


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Figure 6.1

Model of Consumer Behavior


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Analyzing

Business Markets

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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


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Buying Situation

Straight rebuy

Modified rebuy

New task


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The Buying Center

Initiators

Users

Influencers

Deciders

Approvers

Buyers

Gatekeepers


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Identifying

Market Segments

and Targets

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What is a Market Segment?

A market segment consists of a group of

customers who share a similar set of

needs and wants.

Segmenting Consumer Markets


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Segmenting Consumer Markets

Geographic

Demographic

Psychographic

Behavioral


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Demographic Segmentation

Age and Life Cycle

Life Stage

Gender

Income

Generation

Social Class


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Behavioral Segmentation

Decision Roles

Initiator

Influencer

Decider

Buyer

User

Behavioral Variables

Occasions

Benefits

User Status

Usage Rate

Buyer-Readiness

Loyalty Status

Attitude

Figure 8.3 Behavioral


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g

Segmentation Breakdown


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Segmenting for Business Markets

Demographic

Operating Variable

Purchasing Approaches

Situational Factors

Personal

Characteristics


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Steps in Segmentation Process

Needs-based segmentation

Segment identification

Segment attractiveness

Segment profitability

Segment positioning

Segment acid test

Marketing-Mix

Strategy


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Effective Segmentation Criteria

Measurable

Substantial

Accessible

Differentiable

Actionable

Figure 8.4 Patterns of


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Target Market Selection

Figure 8 4 Patterns of


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Figure 8.4 Patterns of

Target Market Selection


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Dealing

with Competition

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Figure 9 1 Five Forces Determining Segment


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Figure 9.1 Five Forces Determining Segment

Structural Attractiveness

Figure 9 6 Six Types of


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Figure 9.6 Six Types of

Defense Strategies

G l k S i


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General Attack Strategies

Frontal Attack

Encirclement

AttackBypass Attack

Flank Attack

Guerrilla Warfare

S ifi A k S i


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Specific Attack Strategies

Price discounts

Lower-priced goods

Value-priced goods

Prestige goods

Product proliferation

Product innovation

Improved services

Distribution

innovation

Manufacturing-cost

reduction

Intensive advertising

promotion


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Creating

Brand Equity

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Wh i B d?


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What is a Brand?

A brand is a name, term, sign, symbol ordesign, or a combination of them, intended to

identify the goods or services of one seller or

group of sellers and to differentiate them fromthose of competitors.

The Role of Brands


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The Role of Brands

Identify the maker

Simplify product handling

Organize accounting

Offer legal protection

The Role of Brands


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The Role of Brands

Signify quality

Create barriers to entry

Serve as a competitive

advantage

Secure price premium

Wh t i B di ?


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What is Branding?

Branding is endowing products

and services with the power of

the brand.

Wh t i B d E it ?


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What is Brand Equity?

Brand equity is the added value endowed onproducts and services, which may be reflected

in the way consumers, think, feel, and act with

respect to the brand.

Ad t f St B d


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Advantages of Strong Brands

Improvedperceptions ofproduct performance

Greater loyalty Less vulnerability to

competitivemarketing actions

Less vulnerability tocrises

Larger margins

More inelasticconsumer response

Greater tradecooperation

Increased marketingcommunications

effectiveness Possible licensing

opportunities

Wh t i B d P i ?


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What is a Brand Promise?

A brand promiseis the marketers vision ofwhat the brand must be and do for

consumers.

Wh t i P iti i ?


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What is Positioning?

Positioning is the act of designing thecompanys offering and image to occupy a

distinctive place in the mind of the target

market.

Defining Associations


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Defining Associations

Points-of-difference(PODs)

Attributes or benefitsconsumers strongly

associate with a brand,positively evaluate, andbelieve they could notfind to the same extent

with a competitivebrand

Points-of-parity(POPs)

Associations that

are not necessarilyunique to the brandbut may be sharedwith other brands

Product Differentiation


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Product form

Features

Performance

Conformance Durability

Reliability

Reparability

Style

Design

Ordering ease

Delivery Installation

Customer training

Customer consulting

Maintenance

Claims of Product Life Cycles


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Claims of Product Life Cycles

Products have a limited life

Product sales pass through distinct stages

each with different challenges and

opportunities

Profits rise and fall at different stages

Products require different strategies in each

life cycle stage

Figure 11.1 Sales and


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g

Product Life Cycle

Figure 11.2 Common


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Product Life-Cycle Patterns

Figure 11.3 Style, Fashion, and Fad Life


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Cycles

Strategies for Sustaining


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Rapid Market Growth

Improve product quality, add new features, andimprove styling

Add new models and flanker products

Enter new market segments Increase distribution coverage

Shift from product-awareness advertising to product-

preference advertising

Lower prices to attract the next layer of price-

sensitive buyers


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Setting Product Strategy

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What is a Product?


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What is a Product?

A product is anything that can be offered to amarket to satisfy a want or need, including

physical goods, services, experiences, events,

persons, places, properties, organizations,information, and ideas.

Figure 12 2 Five Product Levels


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Figure 12.2 Five Product Levels

Durability and Tangibility


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Durability and Tangibility

Nondurable

goods

ServicesDurable

goods



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Product form Features

Customization

Performance

Conformance

Durability

Reliability

Repairability

Style

Service Differentiation
http://www.lego.com/


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Service Differentiation

Ordering ease

Delivery

Installation

Customer training Customer consulting

Maintenance and repair

Returns

The Product Hierarchy


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The Product Hierarchy

Need family

Product family

Product class

Product line

Product type

Item

Product Line Analysis


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Product Line Analysis

Convenienceitems

Core product Staples

Specialties

Line Stretching


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Line Stretching

Down-Market Stretch

Up-Market Stretch

Two-Way Stretch

Line Filling


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Line Filling

Pruning


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Pruning

Pruning weak brandscan strengthen the

remaining brands in

the line

What is the Fifth P?


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What is the Fifth P?

Packaging, sometimes called the fifthP, is all the activities of designing and

producing the container for a product.

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Introducing

New Market Offerings

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Categories of New Products


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Categories of New Products

New-to-the-world

Cost reductions

New product lines

Additions

Improvements

Repositionings

Factors That Limit

d l


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New Product Development

Shortage of ideas

Fragmented markets

Social and governmental constraints

Cost of development

Capital shortages

Faster required development time

Shorter product life cycles

What is a Venture Team?


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What is a Venture Team?

A venture team is a cross-functional groupcharged with developing a specific product or

business; intrapreneurs are relieved of other

duties and provided a budgetand time frame.

Figure 20.2 The New Product Development

D i i P


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Decision Process

Ways to Find Great New Ideas


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Ways to Find Great New Ideas

Run informal sessions with customers

Allow time off for technical people to putter

on pet projects

Make customer brainstorming a part of planttours

Survey your customers

Undertake fly on the wall research to

customers

More Ways to Find Great Ideas


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More Ways to Find Great Ideas

Use iterative rounds with customers

Set up a keyword search to scan trade

publications

Treat trade shows as intelligence missions

Have employees visit supplier labs

Set up an idea vault

Drawing Ideas from Customers


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Drawing Ideas from Customers

Observe customers using product

Ask customers about problems with products

Ask customers about their dream products

Use a customer advisory board or a brand

community of enthusiasts to discuss product

Concept Testing


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Concept Testing

Communicability and believability

Need level

Gap level

Perceived value

Purchase intention

User targets, purchase occasions, purchasing

frequency

Marketing Strategy


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Marketing Strategy

Target markets size, structure, and behavior

Planned price, distribution, and promotion for

year one

Long-run sales and profit goals and marketing-mix strategy over time

Figure 20.7 Product Life Cycle Sales

f Th P d t T


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for Three Product Types

Prototype Testing


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Prototype Testing

Alpha testing

Beta testing

Rank-order method

Paired-comparison method

Monadic-rating method

Market testing

Consumer Goods Market Testing


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g

Sales-Wave Research Simulated Test Marketing

Controlled Test Marketing

Test Markets

Test Market Decisions


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How many test cities?

Which cities?

Length of test?

What information to collect?

What action to take?

Timing of Market Entry


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g y

First entry Parallel entry

Late entry

Criteria for

Ch i R ll t M k t


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Choosing Rollout Markets

Market potential

Companys local reputation

Cost of filling pipeline

Cost of communication media

What is Adoption?


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p

Adoptionis an individuals decision to become aregular user of a product.

Stages in the Adoption Process


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Awareness

Interest

Evaluation

Trial

Adoption

Figure 20.8 Adopter Categorization


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g p g

14


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Developing Pricing Strategies

and Programs

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Steps in Setting Price


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p g

Select the price objective

Determine demand

Estimate costs

Analyze competitor price mix

Select pricing method

Select final price

Step 5: Selecting a Pricing Method


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Markup pricing Target-return pricing

Perceived-value pricing

Value pricing Going-rate pricing

Auction-type pricing

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Designing and Managing Integrated

Marketing Channels

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What is a Marketing Channel?


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A marketing channel system is the particularset of interdependent organizations involved

in the process of making a product or service

available for use or consumption.

Channels and

Marketing Decisions


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Marketing Decisions

A push strategyuses the manufacturers salesforce, trade promotion money, and other meansto induce intermediaries to carry, promote, andsell the product to end users.

A pull strategy uses advertising, promotion, andother forms of communication to persuadeconsumers to demand the product fromintermediaries.

Channel Member Functions


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Gather information

Develop and disseminate persuasivecommunications

Reach agreements on price and terms

Acquire funds to finance inventories

Assume risks

Provide for storage

Provide for buyers payment of their bills

Oversee actual transfer of ownership


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Figure 15.3

Consumer Marketing Channels


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Figure 15.3

Industrial Marketing Channels


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Designing a

Marketing Channel System


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Marketing Channel System

Analyze customer needs

Evaluate major channel alternatives

Identify major channel alternatives

Establish channel objectives

Figure 15.4 The Value-Adds vs. Costs of Different

Channels


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Channels

Channel-Management Decisions


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Selecting channel members

Training channel members

Motivating channel members

Evaluating channel members

Modifying channel members

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Designing and Managing Integrated

Marketing Communications

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What are

Marketing Communications?


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Marketing Communications?

Marketing communications are the means

by which firms attempt to inform,

persuade, and remind consumers, directly

or indirectly, about the products andbrands they sell.

Modes of Marketing Communications


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Advertising Sales promotion

Events and experiences

Public relations andpublicity

Direct marketing Interactive marketing

Word-of-mouth

marketing

Personal selling

Figure 17.1 IMC Builds Brands


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Table 17.1 Communication Platforms


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Advertising Print and broadcast ads

Packaging inserts

Motion pictures

Brochures and booklets

Posters

Billboards

POP displays

Logos

Videotapes

Sales Promotion Contests, games,

sweepstakes

Premiums

Sampling Trade shows, exhibits

Coupons

Rebates

Entertainment

Continuity programs



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Events/ Experiences

Sports

Entertainment

Festivals

Arts Causes

Factory tours

Company museums Street activities

Public Relations

Press kits

Speeches

Seminars

Annual reports

Charitable donations

Publications

Community relations

Lobbying

Identity media

Company magazine



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Personal Selling

Sales presentations

Sales meetings

Incentive programs

Samples Fairs and trade shows

Direct Marketing

Catalogs

Mailings

Telemarketing

Electronic shopping

TV shopping

Fax mail

E-mail

Voice mail

Blogs

Websites

Word-of-Mouth Marketing


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Person-to-person

Chat rooms

Blogs

Figure17.2 Elements in the Communications

Process


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Figure 17.4 Steps in Developing Effective

Communications


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Identify target audience

Determine objectives

Design communications

Select channels

Establish budget

Decide on media mix

Measure results/ manage IMC


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Thank You

&

Wish you all the very Best!!

Download - Crash Course in Basic Marketing Sep 2011

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