an over-simplified guide to marketing concepts and buzz-words

Professor Julie N. Hennessy

Marketing Essentials

An Over-Simplified Guideto Marketing Concepts

and Buzz-Words

Overview of the Marketing Process

Analyze Marketing Opportunities– Environmental Analysis– Competitive Analysis– Consumer Analysis– Company Analysis

Implementation & Control

Select Target Markets– Market Segmentation – Targeting – Positioning

Formulate The Marketing Mix– Product Decisions – Pricing Decisions – Promotion Decisions – Distribution Decisions

MarketingResearch

Company, Consumers, Competitors & Collaborators

Consumers

Competitors Company &Collaborators

OpportunityAnalyses:

Cross-sectionalLongitudinal

Analyses:Assets, Core Competencies, Discipline

Overview of the STP Process

1. Identify segmentation bases and segment the market.

2. Develop profiles of the resulting segments.

1. Evaluate the attractiveness of each segment.

2. Select the target segment(s).

1. Identify possible positioning concepts for each segment.

2. Select, develop and communicate the chosen positioning.

Segmentation

Targeting

Positioning

What Is a Positioning?

• Positioning is the centerpiece of Marketing Strategy

– The positioning identifies the way a firm wants customers to think about their product/brand to maximize their product interest

– The positioning defines how the product will be differentiated to compete in an increasingly competitive marketplace

A Typical Positioning Has Several Pieces...

• Actual Product or Service Description• Target• Benefits• Competitive Context and Advantage

Summarized in this Format

• To (target market), X is the brand of (frame of reference) that (benefit/point of difference) because of (product attribute)

Primary Demand Vs. Selective Demand Stimulation

• Primary Demand StimulationMarketing activity intended to increase demand for the product category.

• Selective Demand StimulationMarketing activity intended to increase demand for one organization’s product or services over those of competitors.

The Path of Least Resistance

• Secure and solidify your relationships with your existing customers

• Attract competitors’ customers • Encourage non-users to use the product

category • Develop new products for current

customers• Develop new products for new markets

Branding —To Extend Or Not Extend?

Evaluationof

Extension

Strength of Brand Meaning

Too weakto beeffective Interference

Branding —To Extend Or Not Extend?

Core Association New Category

Product

Relatedness

Dominance(Interference?)

New associations to be learned depend on :• Consumer’s motivation / involvement• Manufacturer’s communication effort

Source: Adapted from Farquhar, P., J. Han, P. Herr, and Y. Ijiri “Strategies for Leveraging Master Brands” Marketing Research, Sept 1992, 32-43.

Pricing Decisions

Marketing Approach

– Value Based PricingValue = Physical Quality + Psychic Benefits

Cost + Time

Customer Value Price Cost Product

– Core Issues:• Value to Customer• Relationship to Competitors• Relationship to Product/Service cost

Pricing Decisions

• Marketing Math Issues– Break-evens– Pricing Structures through channels

• Competing on price

Hierarchy of Promotion Effects

Awareness

Adoption

Interest

Evaluation

Trial

Push vs. Pull Promotion Strategies

ConsumersTradeFirm

Push Strategy

Firm Trade Consumers

Pull Strategy

Definition & Objectives

Marketing Channels are sets of interdependent organizations involved in the process of making a product or service available for consumption or use to the final consumer. (Stern, El-Ansary & Coughlan 1996)

Distribution Channels aim at making available to the consumer:

• The Right Product (Assortment Utility)• At the Right Place (Place Utility)• At the Right Time (Time Utility)