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INTRODUCTION
What is
Marketing and
what is its role
in Business
Management?
sedatedworld.com
auto-seo-system.com
quite complex
MBT Marketing
107 SE Washington St.
Suite 635 Portland, OR 97214
www-rohan.sdsu.edu
sinergikonsultanmanajemen.wordpress.com
bee-social.com
juliaburman.com
WHAT IS MARKETING?
15
Is Marketing Selling?
From:
Managers sometimes
think of marketing as
the art of selling
products, but many
people are surprised
when they hear that
selling is not the most
important part of
marketing! Selling is
only the tip of the
marketing iceberg.
Selling
Marketing
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Marketing Is A System
3) Develop/Improve & Sell the Product
1) Gather information
Marketer
Market
2) Provide Information
Marketing Success =
(STP) + (the base P) + (the 3 Support Ps)
20
Thats the product created to embody the uncovered consumer priority values
3. Process of delivering the Product via the Support Ps
Segmenti
ng
Identifying all
possible
segments
Packagi
ng
Profiling
Targeting
Determining the
most vulnerable
and profitable
segment
Choosing the
primary target
market (PTM)
Product
Development
Product
Product
Design/
Conceptualizat
ion
Pricing
Uncovering
Consumer insight
Value
Offering
Relevant &
Distinct Unique
Selling Proposition
(USP)
Placement
Branding
(Brand DNA)
Consumer
Insighting
Brand
Positioning
Promotion
Integrated Marketing
Communication (IMC)
By: NAL
Satisfied
Target
Market
Superior
Product/
Service
Effective &
Sufficient
Promotion
Excellent
Market
Insighting
Excellent
Strategy
Formulation
Sales
& Profit
Growth &
Expansion
Reasonable/
Affordable
Price
Extensive
Availability
Excellent
Selling
Procedure
Excellent
Distribution
System
Efficient
Production
Excellent
Manufacturing
System
24
Marketing
Customer-centered
Pre-occupied with
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CUSTOMERS
Top
Management
Middle
Management
U
S
S
T
Frontline People
Middle
Management
Top
Management
CUSTOMERS
Frontline People
R
S
E
R
S
26
Role of Marketing
Where is Marketing in
Business Equation?
27
29
What is the use of
personnel if there is
nothing to do?
Accounting
HR/OD
Marketing
Profit
Production
Sales
Revenues
IT
Customers
Finance
Supply
Chain
What will Supply
Chain supply if there
are no production
requirements?
Role of Marketing in
Value Creation
SEGMENTING AND
SEGMENTATION
SEGMENTING:
IDENTIFYING ALL POSSIBLE
SEGMENTS TO TARGET FOR THE
PRODUCT/SERVICE
32
33
Why Segmentation ?
Better serving customers needs and wants
People have different needs and/or changing needs
The computer manufacturer Dell, for instance, does not organize its
34
Consumer Markets
Geographic:
Land or region
Rural or metropolitan area
Demographic:
Age, sex, marital status
Income, occupation, Education
Religion, nationality, ethnical
group
Psychographic:
Social status
Lifestyle-type
Personal type
Behavioral:
Intensity of product use
Brand loyalty
User behaviors
Industry
Intermediary or final consumer
Type of corporation (public or
private sector)
Size of corporation
Geographical location
Intensity of product use
Organization of purchasing
function
Centralized or decentralized
Purchasing policies, rules and
criteria
Marketers have to choose those variables that are relevant for segmenting the
market for a particular product. The basic rule is to focus on a limited number of
important variables. To segment the market into too many small, slightly distinct
segments would require splitting up the marketing budget into too many ineffective
chunks. Such varied marketing activities in the diverse segments could confuse
customers and would lead to cannibalization effects.
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Examples
Luxury Cars
Mercedez Benz
Senior Top Executives
BMW
Young Achievers/Businessmen
Volvo
Conservative Senior Executives/Businessmen
Axe Deocologne
Young men
Poten-Cee
Smokers
CONSUMER INSIGHTING
Consumer Insight
is The Key
From Dictionary.com
1. an instance of apprehending the true
nature of a thing, esp. through intuitive
understanding
2. penetrating mental vision or
discernment; faculty of seeing into
inner character or underlying truth.
Insight is a great word. Marketing insight sounds valuable. Good to have, and
worth paying a consultant or agency if we cant find one ourselves. An insight is
going to help us succeed, to beat the competition. But what is an insight? How can
you be sure youve got one?
Next time you think youve got an insight, check it againsst this definition :
Interviews
Mystery shopping
Focus groups
Projective techniques
Product tests
Diaries
Omnibus Studies
Trade associations
National and local press Industry magazines
National/international governments
Websites
Informal contacts
Trade directories
Published company accounts
Business libraries
Professional institutes and organisations
Omnibus surveys
Previously gathered marketing research
Census data
Public records
drivers
Determine which way the market is heading
Be aware of recent industry trends or key events
Reach the most suitable target market
Learn about your competitors and their market strategies
Increase sales by in-depth into your clients needs, values,
lifestyles, or your consumers buying behavior, or
demographics
Screen new market niches for business opportunities
Decide on diversification, expansion in other countries or new
distribution channels
Gain crucial, customized information so as to make firm
decisions
VALUE PROPOSITION
Value =
Benefit/Cost
Value
Point-of-Difference Questions
1. Is the key benefit important to
our customer?
2. Can we deliver the benefit?
3. Can we own this point of
difference over time?
4. Is this point of difference
sustainable over our
competition and their directions?
Relevant
Point-of-Parity
Distinct
Point-of-Difference
PRODUCT STRATEGY
AND BRANDING
59
Product Levels
Core Benefit: the value to the customer
Basic Product: the tangible product
Expected Product: attributes and conditions of the product
Augmented Product: exceeds customer expectation
Potential Product: future product to satisfy future demand
60
Types of Products
Consumer: used/consumed directly by the customer
Durable
Non-durable
Fast moving consumer goods
Commodities: price and availability
Product Development
What features and attributes the product should have to
62
Product Decisions
Product type (what need to address/satisfy?)
Product line (what form or category?)
Product depth (what variances?)
Branding
Packaging
Container/Pack Design
Container/Pack Shape and Size
Container Material
Label Design/Text/Color
Benefits
Feature
physical
security
social
personal
spiritual
65
What is a Brandname?
Product name
Product Identity
Equity
Franchise
Company/Organization
66
Considerations in Branding
Easy to pronounce
Easy to remember
Easy to write
No bad meaning in other language
Should convey or connote the products:
Use (Mr. Clean)
Advantage (Havit All)
Benefit (Safeguard)
67
Branding Strategies
Uni-branding - One brand for several products
Company name branding
Family/Mother Branding
Brand Extension
Multi-branding
Distinct brand per product
68
Which is better?
Uni-branding
Effective if there is a strong common attribute among the products
Multi-branding
Different product line
Different attribute or benefit
Different image
69
Examples
Not Quite Effective Uni-branding
Green Cross (alcohol to bath soap)
What else?
Effective Uni-branding
Johnson & Johnson (Baby-care line)
San Miguel (beer line)
Dove (mild personal care product line)
Betadine?
BRAND DNA
What is
?
Unique genetic profile made up of
specific attributes, intricately
balanced which act instantaneously
on the minds of the customers
competitors?
Brand Credibility: What allows me to believe the
Category
Difference
Character
BRAND
Credibility
Benefit
Category
Luxury Car
Difference
Character
Powerful Engine
BMW
Credibility
German
Technology
Benefit
Status Symbol
POSITIONING
77
Positioning
Brand Position in the mind. What step in the brand
Brand X
Brand Y
Brand Z
Positioning
What you want your target market
to perceive about your product
79
According to
Product Benefit
(USP)
Versus Competition
(Repositioning)
82
The marketer would draw out the map and decide upon a label for each
axis. They could be price (variable one) and quality (variable two), or
Comfort (variable one) and price (variable two). The individual products are
then mapped out next to each other Any gaps could be regarded as
possible areas for new products.
Brand Positioning
Reference: Scott M. Davis,
Brand Asset Management : Driving Profitable Growth Through Your Brands
primary components:
A definition of the target market you wish to
pursue
A definition of the business your company is in
or the industry or category it competes in
A statement of your point of difference and key
benefits
85
(brand)
(competitive category)
that provides/makes/gives/offers/brings/etc.
___________________________
(distinct benefit)
86
Example:
For upper middle-class men who
demand the most of themselves,
Boardroom is the fitness center
that provides personal trainers who
bring the most vigorous work-outs
directly to office or home
TAGLINE
positioning statement
What you normally indicate immediately below or
beside the brand name in any communication
material
Should sell the brand right away to the target
market
Should clearly communicate the distinct
advantage of the brand
Bad Taglines
Kojie.San
Good Taglines:
Panasonic Inverter
PRICING
95
What is pricing?
The amount we pay for the over-all value we derived from
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Mercedez)
Image Pricing, ex.?
Parity Pricing: same price
At least one added value
Lower Pricing:
At least the same quality
98
Mark-up Pricing
Unit cost = Variable Cost + (Fixed Cost/Unit
Sales)
Markup Price = Unit Cost/(1-Desired Return on
Sales)
Example:
Variable Cost Per Unit: P10.00
Fixed Costs
: P300,000.00
Expected Unit Sales :50,000
Markup Target
:20%
Unit Cost = 10 +(300,000/50,000) = P16.00
Mark-up Price = 16/(1-0.2) = P20.00
99
Target-Return Pricing
Break-even Volume
Total Revenue = Total Cost
Break-even Volume Formula = Fixed Cost/(Price-
Variable Cost)
Example
FC: P300,000
Price: P20.00
Variable Cost: p10.00
Break-even Volume = 300,000/(20-10) =
300,000/10 = 30,000 units
101
several elements:
and esteem)
102
value
103
Value Pricing
Most Ideal Pricing Strategy
Auction-type Pricing
Primary purpose is to dispose of excess inventories or used goods
It is growing more popular especially with the growth of internet
English Auction (ascending bids)
Would be suppliers can submit only one bid and cannot know the other
bids.
A supplier will not bid below its cost but cannot bid too high for fear of
losing the sale.
Highly advantageous for the seller since it can choose the price for
maximum profit
Effective for contract selling
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Pricing Strategy
Pricing Strategies for New Products
Pricing Strategies for Established Products
Price Flexibility Strategy
Price Leadership Strategy
Requirements
A product must appeal to a market large enough to
support the price advantage
Demand must be highly elastic in order for the firm to
guard its cost advantage
the competition
To act offensively and attempt to beat
competition
To respond to a customer need created
by a change in the environment
inflationary period
To take advantage of product
differences, real or perceived
To segment the current served
market
product
An emphasis on profit margin other
than just volume, and
A record of competitive reactions to
price moves in the past
Requirements:
An oligopolistic situation
An industry in which all firms are
affected by the same price variables
(i.e., cost, competition, demand)
An industry in which all firms have
common pricing objectives
PLACEMENT/DISTRIBUTIO
N
Distribution Defined
Kotlers Definition
Is Selling a Promotion
Yes,
And there is promotion (trade
SUPPLIER
AGENT
DISTRIBUTOR
WHOLESALER
RETAILER
CONSUMER
Distribution =
(Availability)
Promotion =
Sell-in
Sell-out (Off-take)
Intensive
Selective
B2B
PUSH
Philamlife
Viagra
Serendra
Car paints
CADP Sugar
PULL
Nike
San Mig Lite
Happy Meal
Gran Matador
Mercedes Benz
FMCG
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139
Objectives of Promotion
To inform the market about the brand
To convince the market to prefer the
brand
To create recall about the product
To influence the market to make on
the spot buying decision
To establish good company/brand
goodwill or image
The Integrated Marketing Communication enables our customers to achieve oneface communication, a cross-media effect that combines both real and net media,
improvement of brand value and more efficient media penetration etc.
Promotional Elements
Hierarchy of effects:
Awareness.
Interest.
Evaluation.
Trial.
Adoption
SELLING
146
(Segmentation/Targeting)
Gather as many information as possible about your chosen
prospects (Consumer Insighting)
Identify the need that can be particularly addressed by your
product or service (Value Proposition)
Communicate clearly your products attribute that can
particularly satisfy their need or identify what service
should be added/done to totally satisfy the customer
(Promotion)
Do or offer other services that would satisfy other needs
related to the basic need (Full-line Selling)
Conduct post-sales services/activities to sustain a good
relation with the client (Building Customer Loyalty)
ADVERTISING
151
6 Ms in Advertising
1. Message
2. Market
3. Material
4. Media
5. Money
6. Measure
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154
AIDA
Should be appealing to target audience
Should consider celebrity endorser only if
necessarystress a message
155
AIDA
Attention : depends on how creatively executed
the ad is (material)
Interest : depends on the value proposition of the
product (message)
Decision: depends on how significant the product
offer to the audience (positioning)
Action: depends on the level of need of the target
market and competitiveness of the product
156
Frequency
Number of exposure needed to achieve AIDA
Impact
Level of awareness/recall that an ad material would create due to its impact
creative execution)
157
Exerxcise:
Choosing the media mix efficiently & Appropriating Media Budget
158
Established brand
5%; 10%
Share-of-voice
Head-on competition
Example?
Advertising Objective
159
Recall level
Brandname survey
Message survey
Attitude level
Survey, FGD, observation
Sales and Profit
Internal figures
Shelf off-take
Industry Sales Audit (Vs. competition)
160
Assessment of TV ads
Winner corned beef
Family Sardines
Bench (Richard Gomez)
Solmux
Fibisco
161
Sales Promotions
Consumer promotion
Benefits the consumers
162
communication)
When there is strong challenger
To pre-empt any strong competitive move
To capture in-store buying decision
163
Trade Marketing
Availability
Stock inventory monitoring
Visibility
Merchandising
164
Publicity
To create company/brand goodwill with the
customers
To establish favorable company/brand image
To develop customer emotional attachment with the
company/brand
To sustain company/brand patronage
To indirectly solicit government/public support
What to publicize:
CSR activities
Sports sponsorships
Company advocacies (R&D, Clean Environment,
Green Marketing)
165
NAL
Message
Theme
Promotion Mix
Decision
Influencers
Promotion Mix
Decision
Makers
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Sales
Profit
INTRODUCTION
S
T
R
A
T
E
G
I
E
S
Target Market
Product
Price
Placement
Promotion
GROWTH
MATURITY
DECLINE
170
Introduction
Growth
Maturity
Stretch market
Focus on the
primary
Target
Market
target segment
convert non-users
attract competitors'
customers
Improve quality,
styling
Differentiate
Introduce new
variants
Objective pricing
attributes
interested to acquire it
Optimize to maximize profit
Placement
Primary outlets
Expand channel
coverage
Product awareness
Price Skimming
Competitive
pricing
Product
Price
Decline
Product Preference
the channels
Reinvest if new market or
new
movement
No investment
171
172
anything
Greater ease in interacting and placing receiving
orders
An ability to compare note on products and
services
An amplified voice to influence peer and public
opinion
173
sales channel
- Researchers can collect fuller and richer information
about markets, customers, prospects and
competitors
- Managers can facilitate quick communication with
internal and external customers (internet connection)
- Target marketing and two-way communication are
easier (internet connection)
- Companies can establish customer network without
physically organizing them (internet connection)
- Companies can reach customers on the move with
mobile marketing (GPS technology)
174
Discovering/
Identifying the
Value
Segmenting
Profiling
Targeting
Consumer Insighting
Value Offering
Creating the
Value
Product Concept
Product Development
Branding
Positioning
Pricing
Distribution
Placement
Channel Marketing
Making the
Value Accessible
IMC
EMC
Communicating
the Value
Wow,
Indeed!