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Published by: naviramalik on Jan 25, 2011
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Marketing Strategy

Segmentation, Targeting and Positioning

The Tools of Marketing
Business Strategy Marketing Strategy  Who to Serve  How to Serve

Mission SBUs STP

Marketing Tactics and Programs
Pricing Policy 
List prices Discounts and promotions Credit terms Etc.

Product Policy 
Length and depth of line Quality Associated services Packaging/labeling Design Etc.

Promotional Policy

Place/Distribution Policy 
Intensity Terms Service Etc.

Communication Mix Elements

the ´Offeringµ

e. Overall cost leadership 2. markets). Focus . core offering Three generic business strategies (Porter): 1. customer needs. Differentiation 3.Business Strategy A Business has customer groups (i.

Business Growth Strategies Existing Markets Existing Products New Products Market Penetration Product Development New Markets Market Development Diversification .

Marketing Strategy (STP) ‡ Segmentation of customer groups (markets) ‡ Selection of specific Target Markets ‡ Positioning of core offering to each target market .

Social and Demographic Environment ‡ Major effect is on people¶s and organization¶s willingness to buy certain kinds of products and services ‡ ‡ Economic and Technological Environments Impacts on people¶s and organization¶s ability to buy ‡ ‡ ‡ Political and Legal Environments Impacts on the nature of practices used to drive primary and selective demand May also shape primary demand for goods and services needed to comply with regulations .The Environments FACTORS SHAPING PRIMARY DEMAND ‡ Cultural.

the internal environment) Major effect is on people¶s and organization¶s choice of your brand over others .The Environments FACTORS SHAPING SELECTIVE DEMAND ‡ Competitive Environment ‡ ‡ ‡ Impacts on whether we can meet buyer needs better than anyone else Includes substitutes Major effect is on people¶s and organization¶s choice of brands other than yours ‡ ‡ Customer Environment Major effect is on people¶s and organization¶s choice of brands ‡ ‡ Current Marketing Situation (i.e.

Competitive Assessment For Each Competitor. Assess the following: Marketing Strategy ‡ ‡ ‡ ‡ ‡ ‡ ‡ Target Market(s) Business Strategy Generic Strategy Market Share Key Success Factors Share of Mind Competitive Advantage (Positioning) Marketing Mix Elements ‡ ‡ ‡ ‡ ‡ ‡ ‡ ‡ Core Offering(s) Product/Service Quality Pricing Communication Media Personal Selling Methods Distribution Methods Location Post-sales service .

Demographic .ii .2 Segment C.Base Segment C.Base Segment C.Behavioral .Psychographic Segment C.Geographic .Segmentation Scheme Core Offering Segment A Segment B Segment C Level 1 .3.3 Level 2 .3.1 Segment C.i Typical Bases: .

A Sample Canadian Chocolate Segmentation Map Gifting Kid's Treat Adult Treat (12+) Refuel Formal Gesture Easter Christmas Informal Halloween Reward/Treat Pester Shut up Permissible Spoiling Kinder Surprise Smarties Astro's M&M Minis Personal Spoiling Me Time Relaxation Personal Reward Caramilk/Rolo/Dove Creme Eggs Bounty Cerises/Pep Gut Fill Meal Replacement Hungry Boxed Chocolates Laura Secord Seasonal Seasonal Mr. Big Mars/Snickers Oh Henry Butterfinger Indulgence Pleasure Feel Good Gap Fill/Snacking In between Meals Peckish Small Snack CMC Aero/Mirage Flake HMC Crispy Crunch W underbar/Crunchie Kit Kat/Coffee Crisp Twix .

The Segmentation Grid Consumer Profiling Contents: ‡ Who buys« ‡ ‡ ‡ ‡ ‡ What Where When Why How .

etc. ‡ ‡ .Assessment of Current Marketing Situation ‡ Current marketing strategy assessment ‡ Segmentation strategy ‡ Target Markets ‡ Positioning & Branding ‡ Marketing Mix Elements Sources of competitive advantage Constraints ‡ Budget ‡ Technology ‡ Human factors ‡ Channels ‡ Suppliers ‡ Management.

SMART Objectives ‡ ‡ ‡ ‡ ‡ Specific Measurable Achievable Realistic Timeline The Marketing Plan A Hierarchy of Objectives Overall Plan Objectives Individual Segment Objectives Positioning Objectives Tactical Objectives: ‡Product Objectives ‡Pricing Objectives ‡Place Objectives ‡Promotion Objectives .

Integrating Analysis with Planning CUSTOMER ANALYSIS Who BUYS What. Where. Where. How and Why Determine Basis of Differentiation ASSESS MARKET-COMPANY FIT Define Quality and Identify Segments You Can Serve (Targeting) ASSESS PRODUCT-COMPANY FIT Evaluate Relative Quality and Identify Competitors You Can Beat (Targeting & Positioning) . When. where and when? COMPETITOR ANALYSIS Who OFFERS What. for whom. When. How and Why Determine Basis of Segmentation COMPANY ANALYSIS Given your objectives and resources « what can you do.

Alternatives Segmentation Strategy Segment A Segment A Niche A1 Niche A2 Niche A3 Niche A1 Niche A2 Niche A3 Segment B Segment B Segment B Segment B Segment C Mass Market MultiSegment Strategy Segment C Single Segment Strategy Segment C Segment Niche Strategy Segment C Mass Customization Strategy .

Targeting Decision Matrix Criteria (Fit) Attractive? Fit with growth and profit objectives? Fit with Mission? Competitive Advantage Company Resources Weight ** ** ** Target Segment A Target Segment B Target Segment C Constraints? Fit with Trends ± elements affecting Primary Demand Profitable? Total .

or ³identity´ of a product in the minds of consumers. relative to competitive offerings.Positioning ‡ The ³definition´. ‡ Assumes ‡ Differentiation ‡ A positioning statement ‡ To defined target segment ‡ X is the brand of defined category ‡ That unique selling proposition . ³place´.

Positioning Competitively: Alternative Positioning Strategies ‡ ‡ ‡ ‡ ‡ Product attributes Benefits offered Usage occasions Classes of users Directly on competitor ‡ Around competitor ‡ Against product class .

Positioning: The Unifying Theme for Marketing Efforts What the Customer Gets Positioning Reflects Key Elements of Strategy  How we think the customer views the product  How we want the customer to think about us  Who the customer sees as a substitute for us  What we feel we can do better than the competition Brand identity Image Level of quality Features What the Customer Wants Associated services Positioning Shapes Customer Expectations  A ³promise´ to potential customers  The reason they give us trial. the standard we must meet Packaging Installation All Marketing Elements Must Reinforce the Positioning  Positioning embodies the principle of market FOCUS  Focus requires a concentration on a specific type of customer  Inconsistencies between marketing tools leads to a loss of efficiency and effectiveness .

Creating a Value Proposition (Positioning) ‡ Part 1: What We Do ‡ ‡ ‡ ‡ ‡ For Who want Our product is That features As measured by the target market the ³consumption problem´ (what ³need´ do you serve?) our portion of the ³solution´ (when do they think about your class of product in connection with that need?) key benefit provided (what¶s the one or two things you want them to remember about you?) how the customer infers quality ‡ Part 2: Why We Will Win ‡ ‡ ‡ ‡ Unlike Our product provides As supported by And protected by our main competitors key point(s) of difference what makes our difference possible (why they should believe us«TODAY) why the competition cannot easily overcome it (why they should believe us«TOMORROW) .

The role of the marketing mix Product Price Place Promotion Physical Evidence Process People Partnering Target Customers Marketing Strategy Decisions Tactical Implementation Customer Effects .

Selection .Training .Motivation ‡ Advertising .Kinds of Ads .Number .Some Decision Areas Organized by the Four Ps Product ‡ ‡ ‡ ‡ ‡ ‡ ‡ ‡ ‡ ‡ ‡ ‡ Objectives Physical Goods Service Features Quality Level Accessories Installation Instructions Warranty Product Lines Packaging Branding Place ‡ Objectives ‡ Channel Type ‡ Market Exposure ‡ Kinds of Middleman ‡ Kinds and Locations of Stores ‡ How to Handle Transporting and Storing ‡ Service Levels ‡ Recruiting Middlemen ‡ Managing Channels Promotion ‡ Objectives ‡ Blend ‡ Salespeople .Media Type .Who Prepares? ‡ Sales Promotion ‡ Publicity Price ‡ Objectives ‡ Flexibility ‡ Level over Product Life Cycle ‡ Geographic Terms ‡ Discounts ‡ Allowances .Kind .Copy Thrust .Targets .

Some Decision Areas Organized by the other Ps Phys.Statements .Guarantees Process ‡ Objectives ‡ Flow of activities ‡ Customer involvement ‡ Number of steps ‡ Queuing ‡ Payment methods People ‡ Objectives ‡ HR activities ‡ Customer training ‡ Customer education Partnering ‡ Objectives ‡ Loyalty programs ‡ Incentive programs ‡ Alliances ‡ Networking .Bus. Evidence ‡ ‡ ‡ ‡ ‡ ‡ Objectives Facility Design Equipment Signage Employee Dress Other tangibles .Reports . Cards .

. X is the differentiated brand of category that offers«.Marketing Mix Target Segment A Positioning Statement To Target Market A. Objectives for Product Mix Items Product Tactics to augment offering to fit with positioning Objectives for pricing Pricing tactics to fit with positioning Objectives for promotion Promotion tactics to fit with positioning Objectives for channels/place Tactics Objectives and tactics Target Segment B Product Price Promotion Place Partnering Physical Evidence* Process* People * .

People Marketing Manager Money $10. purchase couches. 2003 Control/Evaluation Track telephone calls and website visits preand post-advertisement Review regular customer surveys to check satisfaction with waiting area Store managers to review inventory weekly to determine if further price changes are needed Office Manager $15.000 for new furniture and other chattels $300 for new price tags October 2003 Reduce price of Widget inventory to eliminate excess stock Store Managers November 2003 .Implementation Implementation Task Place full page advertisement in CIO magazine Re-arrange waiting area.000 Time September.

000 1480 1480 $100 $148.000 $280 820 $200.200 820 $200.000 $610.Budget R evenue C ruise Passengers T otal R evenue Variable C osts Services M arketing T otal Variable C osts C ontribution M argin Fixed C osts Indirect C osts W ages Q uantity 1480 W orst C ase O bjectives B est Price T otal Q uantity Price T otal Q uantity $500 $740.000 $200.000 $20 $29.600 820 $200.000 $500 $845.000 $610.000 $20 $33.600 $120 $177.000 $500 $410.600 $20 $32.800 $380 $642.000 1690 $500 $740.000 -$47.000 C ase Price T otal $500 $845.000 $32.400 1606 1606 $100 $160.720 $380 $610.000 $200.120 $120 $192.000 $500 $410.600 $380 $562.200 N et Profit ‡ Projections of sales ‡ Include and note implementation costs ‡ Sensitivity analysis .000 $610.280 1690 1690 $100 $169.000 $500 $803.000 1606 $500 $803.000 $500 $410.000 $200.800 $120 $202.

Controls The Marketing Plan A Hierarchy of Objectives Overall Plan Objectives Metrics Individual Segment Objectives Method of Evaluation Timing and frequency of Evaluation Reaction Plans Contingencies .

The Report ‡ ‡ ‡ ‡ ‡ ‡ Introduction (Background) Case Problem(s). Issue(s) Objectives/Decision Criteria Analysis Current marketing situation Identification and analysis of alternatives ‡ ‡ Marketing Strategy/ Recommendations Implementation Plan (Marketing Mix) .

Cunningham. Wharton Dr. and Gremler (2005). Bitner. Myrden. T. S. S. McGraw-Hill The 2201 Team ± S.Sources Dr. Services Marketing ± 4th Edition. Stapleton. Armstrong. Queen¶s Kotler and Keller (2007). M. K. D. Taylor. Queen¶s Mr. Pearson/Prentice Hall Zeithaml. Queen¶s Dr. A Framework for Marketing Management ± 3rd Edition. Jones . Wong.

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