i. situation analysis a.marketing & promo mix b.consumer / market / environment c.competitive...

I. SITUATION ANALYSISA. Marketing & Promo Mix

B. Consumer / Market / Environment

C. Competitive Situation

D. Marketing / Advertising Objectives

E. Creative Strategy

Topic: Marketing Situation Analysis

Note: Only B (excl. environment) & C will be discussed in the slides following. This power-point slides are intended for students who haven’t completed Com 352 and provide a review of some basic knowledge concerning situation analysis. Handouts are available for the asking.

B. Consumer, Market, Environment

1. Market (Geographic) Analysis

2. Consumer (Demography, Usage) Analysis

3. Environmental (Constraint) Analysis

Topic: Marketing Situation Analysis B. Consumer, Market, Environment

1. Market Analysis

Sales Potential Indicators: CDI & BDI

When market sales data are available:

CDI % of Category Sales= / % of Persons


BDI = % of Brand Sales / % of Persons

1. Market Analysis


When market sales data are NOT available:

CDI % of Category Users= / % of Persons


BDI = % of Brand Users / % of Persons

1. Market Analysis How are CDI/BDI used?Simple scenario approach

CDI BDI Market Potential

High High Promising

High Low Room for Growth

Low High Maintaining

Low Low No-Win


1. Market Analysis How are CDI/BDI used?

Other Weighting Approaches


Equal weights: .5BDI + .5CDI Unequal Weights (examples):

.75BDI + .25CDI

.33BDI + .67CDI

Note: BDI/CDI are only two of many indicators of market potential and thus used with other market indicators in media/target decisions

1. Market Analysis


Example 2 (see handout): CDI & BDI

What do CDI and BDI for Seattle indicate about its market potential?

CDI Setl. =

BDI setl. =

1.78

.93X 100= 191

1.56

.93X 100= 168

1. Market Analysis


Example 2: CDI & BDI

What do CDI and BDI for S.F. indicate about its market potential?

CDI S.F. =

BDI S.F.. =

2.82

1.69X 100= 167

3.0

1.69X 100= 178

1. Market Analysis Example 2: CDI and BDI


With equal weights given: .5BDI + .5CDI

Seattle = .5 X 168 + .5 X 191 = 180

San Francisco = .5 X 178 + .5 X 167 = 153

Note: Based on the BDI and CDI alone, you will choose Seattle to spend surplus ad budget.

1. Market Analysis Example 2: CDI and BDI


With unequal weights given: .75BDI + .25CDI

Seattle = .75 X 168 + .25 X 191 =

San Francisco = .75 X 178 + .25 X 167 =

Note: With the BDI and CDI weighted unequally, you will choose San Francisco to spend surplus ad budget.

1. Market Analysis

Sales Potential Indicators: CDI & BDI When market sales data are not available: (case for your project)

BDI % of Brand Users=

=# of B. Users in Market

# of Persons in Market

OR

/ % of Persons

/ # of B. Users in Population

/ # of Persons in Population

Topic 2: Marketing Situation Analysis B. Consumer, Market, Environment

X 100

1. Market Analysis


When sales data are available by geo market:

BDI % of Brand Sales=

=B. Sales ($) in Market


OR

/ % of Persons

/ B. Sales in U.S.

/ # of Persons in US


X 100

1. Market Analysis


When data are not available:

CDI % of Category Users=

=# of C. Users in Market


OR

/ % of Persons

/ # of C. Users in US

/ # of Persons in US


X 100

2. Consumer Analysis


When sales data are available

by consumer segment:

CDI % of Category Sales= / % of Persons


BDI = % of Brand Sales / % of Persons

Sales Potential Indicators –CDI, BDI

When sales data are NOT available

Note: Sales potential indicators, CDI or BDI, are derived from MRI or Simmons data which report the product or brand usage index in ‘D’ column

CDI % of Category Users= / % of Persons


2. Consumer Analysis:

BDI = % of Brand Users / % of Persons


MRI Index (for Category)-- E.g., age 18-24

% of All Category Users

=

=# of C. Users in 18-24

# of Persons in 18-24

/% of All Persons

/ # of C. Users in All ages

/ # of Persons in All ages



X 100


MRI Index (for Brand): E.g., age 18-24

% of All Brand Users

=

=# of B. Users in 18-24

# of Persons in 18-24

/ % of All Persons

/ # of B. Users in All ages

/ # of Persons in All ages



X 100

How Is MRI/Simmons Index used? - Does the segment with the highest index have

the greatest sales volume potential?

Age

18-24

25-34

35-44

% Pop

13

20

36

% Users

17

18

33

Calculation

(17/13)X100

(18/20)X100

(33/36)X100

Index

131

90

92



Why or why not?Example:

• How consumer segments should be analyzed for sales volume potential:

Volume Potential 18-24 =

Volume Potential 35-44 =

.17 X 131 = 22.3

.33 X 92 = 30.4


2. Consumer Analysis

---Use User Size and Index; Weigh User Size by Index to determine volume potential (value) of segment

Note: the volume potential above is not actual sales volume but estimated composite weight that takes on meaning only when compared to other composite weights

C. Competitive Assessment: 3 Components

1. Market shares for all direct and indirect

competitors

2. Competitive (and your) media mix and

expenditure (in $ and % of their budget)

3. Share-of-Voice or Ad Share (brand’s

expenditure as % of all brands’ spending

Topic: Marketing Situation Analysis

1. Competition & Market Shares

For your project, Use LNA/Media Watch Data for

competitive mix & expenditure and SOV

Our library has 1994 data (Jan-Sept), UCLA,

management library has 1999 data.

Topic: Marketing Situation Analysis C. Competitive Assessment

1. Competition & Market Shares

Direct Competition:

Indirect Competition


Brands in the same product class as yours;

e.g.,

Brands in one or more different product classes; e.g.,

2. Media Mix & Expenditure (2 tables or 1 combined table)


Raw Expenditures Table -- to show, for each competitor (& you): What media types have been used and how much

($) has been spent in each of the media?

Media Proportion Table

Note: the two tables above may be combined into one as in the LNA exercise provided

What percent of the brand budget is spent in each medium?

Brand Total Mag. S. Mag.. Nwsp Outdoor Net TV Spot TV Syn. TV

Sealy $ 29,851

$316.4 223.6 188.1 0 17,222 2,635.9 7,043.0

% 1.1 0.7 0.6 0 57.7 8.8 23.6

Serta $ 9,091 0 0 27.2 26.4 0 7,389.5 605.4

% 0 0 0.3 0.3 0 81.3 6.6

Y yyy yyy yyy yyy

Totals 58,222 9,307.4 251.4


2. Media Mix and Expenditure

< Two Tables Combined: Example 1>

<Combined Table: Example 2>

Brand All % Mag. % Newp. %

Canon 14,047 100 7,095 51.0 1,011 7.2

Mita 7,592 100 1,829 24.1 716 9.4

Ricoh 5,474 100 1,164 21.3 1,471 26.9

Sharp 8,785 100 2,862 32.6 311 3.5

Xerox 124 100 37 3.0 653 52.7

Totals 37,140 12,988 4,164


2. Media Mix and Expenditure

3. Share-of-voice or Ad Share(in %)

Overall: SOV = Brand Y’s total $ x 100______

All Competitors or Brands total $

In Each Medium: SOV = Brand Y’s $ in medium x 100______ All Competitors or Brands total $ in

medium


Example (see handout)

SOV Sealy/Overall =

(29,851.6 / 58,222.4) x 100

= 51.3 %

(316.4 / 9,307.4) x 100

= 3.4 %


3. Share-of-Voice (SOV)

• SOV Sealy/Mag =

Guidelines in Assessing Competitive Efforts

1) From competitive media mix table, determine what media have been used heavily and what rarely, and consider their implications for your own media mix -- what media must be used and why and assess threats and/or opportunities that might exist in the use of certain media


2) From SOV analysis, assess your strengths/weaknesses against the competition, and see if any change in the mix and/or increase or decrease in spending for certain media is warranted for an effective media mix for your brand.Example: LNA Exercise #4

i. situation analysis a.marketing & promo mix b.consumer / market / environment c.competitive...

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