Brief Marketing Notes

http://www.tmp.ucsb.edu/courses/engr191a/
The Marketing Mix
Product
Price
Promotion
Place
Set the Mix
Market Selection
Market Segmentation
Product Differentiation
Questions Well Need to Answer
Who will be most likely to buy my product (or service)?
What do they want to buy?
Where do they want to buy it?
How much are they willing to pay?
How and when will they gather information about competitive products?
Why will they buy our product rather than a competitors?
Elements of the Marketing Mix
Communications – selling, advertising, public relations
Pull vs. Push – or both?
Pricing – an entire discipline/science
Distribution Channels – managing the “trade”
Product Policy – where it all comes together (especially in positioning)
Marketing Processes
Situation Analysis (SWOT)
Strategy Formulation
Planning, Organization and Budgeting
Implementation
Watching the “game films”
Summary – What is Marketing?
A process that begins with the consumer
A tool kit that includes:
– deeply understanding our consumer
– choosing appropriate markets
 – finding a niche within a chosen market
– differentiating our product offering
– pricing, selling, advertising, distribution
Topics of Marketing
Positioning
Segmentation
Strategy Formulation
Market Research
Advertising, Promo, PR
Channel Decisions and Sales
Creating a Winning Plan
Building Strong Brands
 Positioning
http://www.csupomona.edu/~hczepiec/mkt525/
Positioning is the act of designing the company’s offering and image to occupy a
distinctive place in the the target market’s mind.
Steps in the Positioning Process
1. Identify relevant set of competitive products.
2. Identify the set of determinant attributes that define the “product space” in which
positions of current offerings are located.
3. Collect information from a sample of customers and potential customers about
perceptions of each product on the determinant attributes.
4. Analyze intensity of a product’s current position in customers’ minds.
5. Determine product’s current location the product space (product positioning).
6. Determine customers’ most preferred combination of determinant attributes.
7. Examine the fit between preferences of market segments and current position
of product (market positioning).
8. Select positioning or repositioning strategy.
http://www.tmp.ucsb.edu/courses/engr191a/
Implications for Entrepreneurs
Forge deep relationships with customers, suppliers, distribution channels
Ensure everyone in your company is “on the same page” – were all marketers!
Build in feedback mechanisms to customer and trade relationships
Think deeply about how you can “own” the customer (be first, switch from
 monologue to dialogue, climb the ladder)
Think creatively about positioning – where are you in the customers mind?
Comparisons of Physical and Perceptual Positioning Analysis
Physical positioning Perceptual positioning
• Technical orientation • Consumer orientation
• Physical characteristics • Perceptual attributes
• Objective measures • Perceptual measures
• Data readily available • Need for marketing research
• Perceptual brand positions and
• Physical brand properties
positioning intensities
• Large number of dimensions • Limited number of dimensions
Posit.xls
• Represents impact of product • Represents impact of product
specs and price specs and communication
• R&D implications need to be
• Direct R&D implications
interpreted

Ways to Position
Specific product features
Benefits, problem solution or needs
Specific usage occasions
User category
Against another product
Product class dissociation
 Segmentation
What is a Market?
• A market is a group of individuals or organizations (i.e. buyers) having the
willingness and ability to buy goods or services to satisfy a particular class of
wants or needs.
• Understanding the market; selecting the best market & understanding its buying
behavior are key to the success of the marketing plan.
Steps in Market Analysis
1. Define Market to Identify Competitive Arena
2. Segment the Market to Determine Competitive tactics.
If you can find an objective reliable way to define groups of people;
If you can measure the sales and profit potential of the segments;
If these segments can be profitably reached using marketing
If you can expect a different response from the unique marketing plans you
offer each segment
Segmentation is Effective If
• Measurable – Size, purchasing power, profiles of segments can be measured
• Substantial – Size of market large enough to justify tailored strategy costs
• Accessible – Reachable via personal or impersonal media
• Differential – Homogenous within & heterogeneous between; must respond
differently to different marketing mix elements & actions.
• Actionable – Company can develop different marketing strategies to serve
segments
3. Develop profiles of the resulting segments
4. Evaluate the attractiveness of each segment & Select the Target Segment(s)
– Understand Customer Motivation and Behavior to determine relevant assets
and skills
Bases for Segmenting Consumer Markets
Geographic: Nations, states, regions, counties, cities, neighborhoods
Demographic: Age, gender, family size, life cycle, race, occupation, income
Psychographic: Lifestyle or personality
Behavioral: Occasions, benefits, uses, attitudes, loyalty, buyer-readiness
Multi-Attribute: Smaller and better defined target groups, geoclustering
Bases for Segmenting Business Markets
• Demographic
• Operating variables
• Purchasing approaches
• Situational factors
• Personal characteristics
Customer Analysis
• To develop an effective marketing plan, it is necessary to understand customers
and their buying behavior
What Do You Need To Know About the
Customers?
• Who constitutes the market?
• How many are there?
• Why does the market buy it?
• When does the market buy it?
• Where does the market buy it?
• How much do they buy? How often?
• How do they make their buying decision?
Consumer Buying Decisions
• Multifaceted
– Product, Brand, Dealer Choice; Purchase Timing, Amount
• Multi Step
– Problem Recognition, Information Search, Evaluation, Decision, Post Purchase
Behavior
• Subject to Multiple Influences
– Cultural, Social, Personal and Psychological Factors and External
Environment
 Marketing strategy
Marketing strategy involves two basic activities
– Selecting a target market and determining the desired positioning in the target
consumers mind
– Specifying the plan for the marketing activities to achieve the desired positioning

Setting Up the Playing Field…

Customer needs – what needs do we seek to satisfy?
Company skills – what special competencies do we possess to meet these
needs?
Competition – who competes with us in meeting those needs?
Collaborators – who should we enlist to help us and how do we motivate them?
Context – what cultural, technical and legal factors limit whats possible?
The Positioning Statement
This statement articulates how your product service will “win” in the market
Statement must be made in the context of your category
Clear “claim” and “reason why” is imperative
The Four Ps – PRODUCT
– Product: not the thing itself, but the total package of benefits obtained by the
customer
– Identifying customer problem
– Defining concept to address problem
– Design/test product and concept (and marketing mix elements)
PLACE
Place = Marketing Channels
Two major decisions in channels
– Channel design (direct?, indirect?, both?)
– Channel management (managing partners)
PROMOTION
1. Market – to whom is the communication to be addressed?
2. Mission – what is the objective of the communication?
3. Message – what are the specific points to be communicated?
4. Media – which vehicles will be used to convey the message?
5. Money – how much will be spent in the effort?
6. Measurement – how will impact be assessed?
PRICING
In theory, the combination of product, channel and communications mix
determine the target customers perception of value.
Six steps in setting price for the first time:
1. Select the pricing objective
2. Determine demand
3. Estimate costs
4. Analyze competitors prices/offers
5. Select a pricing method
6. Select the final price
What are the Elements of an Effective Strategy?
It clearly defines the served market that has been selected by the firm
It positions the firm and its products and services to highlight their differential
advantage over the competition
It addresses the timing of market entry and exit
Focuses on variables that are critical points of leverage
Provides flexibility in responding to competitive actions and changes in the
marketplace
Integrates marketing efforts into the strategies of other functions
Has long-term (e.g. 3-5 years) rather than short term perspective