Professional Documents
Culture Documents
Marketing channel: -
Marketing channel is a set of institutions necessary to transfer the title to
goods and to move goods from the point of consumption.(Vendors,
publishers, library facilities.)
Marketing mix: -
The mix of controllable variables that the firm/library uses to reach desired
use/sales level in target market, including price, product, place and
promotion- 4 P’s. For a library this would be embodied in price of user’s time
to access goods, a product would be a book or storytime, place is a branch
or bookmobile, and promotion is publicity, displays etc.
Marketing plan: -
A document composed of an analysis of the current marketing situation,
opportunities and threats, analysis, marketing objectives, marketing
strategy, action programs, and projected income statement. This could be
very similar to a library’s long range plan. Maturity stage of product life
cycle Initial rapid growth is over and use/sales level off.
Microenvironment The set of forces close to an organization that have
direct impact on its ability to serve its customers, including channel member
organizations, competitors, user markets, publics and the capabilities of the
organization.
Macroenvironment: -
The conditions facing a company/library including demographic, economic,
natural, technological, political, and cultural forces.
Market positioning: -
Positioning refers to the user’s perceptions of the place a product or brand
occupies in a market segment. Or how the company/library’s offering is
differentiated from the competition’s. For a library a competitor may be
another public agency competing for public funds. What unique niche does
the library serve when competing against police for same $$
Market profile A breakdown of a facility’s market area according to income,
demography, and
life style (often.)
Market segmentation: -
Market segmentation is the process of subdividing a market into distinct
subsets of users that behave in the same way or have similar needs.
Segments for the library could be demographic (Asian); geographic (branch-
level); psychographics (leisure-oriented); customer size (largest user group
area); benefits (have children in the home learning to read.)
Market share: -
Market share is a proportion of the total sales/use in a market obtained by a
given facility or chain. Branch A has 35% of the system’s circulation.
Holistic marketing: -
Holistic marketing is a concept that is increasing in popularity, as more
business owners are seeking to promote their products and services in a way
that conveys authenticity and integrity. Holistic marketing can be defined as
a heart-centered approach to expanding and promoting one's business. The
intention is to attract highly qualified customers who have made an
emotional connection with what is being offered.
Conventional marketing is much more of an impersonal process that looks at
promotion as a numbers game. The more people who are exposed to your
marketing messages, the better. Holistic marketing is a personal process of
building genuine relationships with prospective customers through effective
education and benefit-oriented story sharing.
The beauty of this form of marketing is that there is very little selling that
has to be done in the negative sense of the term. Instead, the prospective
customer sells him/herself on what is being offered through effective
connection and education. Many service-based business owners who hate
the idea of forcing others to see the value in their product are now able to
promote their work authentically using this concept of holistic marketing.
In particular, the internet makes it much easier to engage in this new style
of marketing. Now the business owner can share helpful information from
their website in a way that does the selling for them. The main idea is that
selling is accomplished through offering value up front with no risk on the
part of the prospective client. Then, if it is a natural progression, the
customer will move through the sales funnel until he/she decides that they
are ready to buy.
Holistic marketing is a concept whose time has come. Now, entrepreneurs
who have hated selling can promote their work without being pushy or
inauthentic.
Relationship marketing: -
Relationship marketing is a form of marketing developed from direct
response marketing campaigns conducted in the 1970s and 1980s which
emphasizes customer retention and satisfaction, rather than a dominant
focus on point-of-sale transactions.
Relationship marketing differs from other forms of marketing in that it
recognizes the long term value to the firm of keeping customers, as opposed
to direct or "Intrusion" marketing, which focuses upon acquisition of new
clients by targeting majority demographics based upon prospective client
lists.
Integrated marketing: -
Coordination of a variety of promotional vehicles (e.g., print/broadcast advertising,
public relations, direct marketing, in-store promotions) and multiple stages in a
promotional campaign to ensure that the marketing message is consistently
received by the greatest possible number of people in the target market.
Sales is also a tactic of marketing. This is typically what the sales force does. But it is
marketing's job to focus the entire marketing effort (of which the sales force is one part)
towards providing what customers want and gaining a sustainable strategic advantage.
Marketing Environment: -
“The forces that directly and indirectly influence an organisation’s capability
to undertake its business.”
OR
“All the things that a company must consider when developing its marketing
plans, such as people’s incomes, the products of competitors, new
technology.”
E.g. the impact of the Internet on today’s marketing environment
Task Environment: -
The task environment includes sectors with which the organization interacts
directly and that have a direct impact on the organization's ability to achieve
its goals. The task environment typically includes the industry, competitors,
customers, techniques of production, suppliers, stock market, raw materials,
market sectors, and perhaps the human resources and international sectors.
Broad Environment: -
“Broad environment is the environment which constitutes the general
environmental influences that all firms must cope with.” Broad environment
includes analysis of economic forces, socio-cultural forces, demographic
forces, political and governmental, technological factors, etc.
Supply Chain: -
“A whole series of processes, companies, places, etc. that are involved in
making and selling a product. The supply chain includes the supply of raw
materials and parts and the processes of manufacturing, storing,
transporting and selling the product to the customer.”
Market segmentation: -
Market segmentation is a strategy that involves dividing a larger market into
subsets of consumers who have common needs and applications for the
goods and services offered in the market. These subgroups of consumers
can be identified by a number of different demographics, depending on the
purposes behind identifying the groups. Marketing campaigns are often
designed and implemented based on this type of customer segmentation.
One of the main reasons for engaging in market segmentation is to help the
company understand the needs of the customer base. Often the task of
segregating consumers by specific criteria will help the company identify
other applications for their products that may or may not have been self
evident before. Uncovering these other ideas for use of goods and services
may help the company target a larger audience in that same demographic
classification and thus increase market share among a specific sub market
base.
Market segmentation strategies can be developed over a wide range of
characteristics found among consumers. One group within the market may
be identified by gender, while another group may be composed of
consumers within a given age group. Location is another common
component in market segmentation, as is income level and education level.
Generally, there will be at least a few established customers who fall into
more than one category, but marketing strategists normally allow for this
phenomenon.
Along with playing a role in the development of new marketing approaches
to attract a certain demographic within the market base, market
segmentation can also help a company understand ways to enhance
customer loyalty with existing customers. As part of the process of
identifying specific groups within the larger client base, the company will
often ask questions that lead to practical suggestions on how to make the
products more desirable to customers. This activity may lead to changes in
packaging or other similar changes that do not impact the core product.
However, making a few simple changes in the appearance of the product
sends a clear message to consumers that the company does listen to
customers. This demonstration of good will can go a long way to strengthen
the ties between consumer and vendor.
ANALYSIS
OBJECTIVES
STRATEGIES
TACTICS
CONTROLS
Stage One - Situation Analysis (and Marketing Audit).
• Marketing environment.
• Laws and regulations.
• Politics.
• The current state of technology.
• Economic conditions.
• Sociocultural aspects.
• Demand trends.
• Media availability.
• Stakeholder interests.
• Marketing plans and campaigns of competitors.
• Internal factors such as your own experience and resource availability.
Also see tools for internal/external audit:
• SWOT
• PEST
• Porter's Five Forces
• Marketing Environment
“The process of a company planning where and how to sell its products
most effectively”
b. Tactical Marketing: -
"Tactical Marketing is the execution of your marketing plan, such as
generating leads, placing media, creating marketing tools, and implementing
a follow-up system. In other words, it's the medium in which your message
is delivered.”
Customer Loyalty: -
“The fact that a customer prefers to use a particular shop/store, etc. or
continues to buy a particular type of product.”
Customer equity: -
Customer equity is the total combined customer lifetime values of all of a
company’s customers.
Overview
In deciding the value of a company, it is important to know of how much
value its customer base is in terms of future revenues. The greater the
customer equity (CE), the more future revenue in the lifetime of its clients;
this means that a company with a higher customer equity can get more
money from its customers on average than another company that is identical
in all other characteristics. As a result a company with higher customer
equity is more valuable than one without it. It includes customers' goodwill
and extrapolates it over the lifetime of the customers.
The term is a misnomer since the term has nothing to do with the traditional
meaning of equity.
There are three drivers (factors) to customer equity, all of which refer to
three sides of the same thing:
1. Value equity: What the customer assesses the value of the product or
service provided by the company to be;
2. Brand equity: What the customer assesses the value of the brand is, above
its objective value;
3. Retention equity: The tendency of the customer to stick with the brand
even when it is priced higher than an otherwise equal product;
Customer equity strategy
Companies often attempt to gain more customers and increase revenues by
improving customer equity. They do this by:
• improving consumer service
• improving the value or desirability of the brand
• improving goodwill
• improving brand popularity such as by advertisements
• Cultural factor divided into three sub factors (i) Culture (ii) Sub
○ Culture:-
The set of basic values perceptions, wants, and behaviour
learned by a member of society from family and other
○ Sub Culture :-
○ Social Class:-
Almost every society has some form of social structure,
social classes are society’s relatively permanent and
ordered divisions whose members share similar values,
• It includes
• i) Age and life cycle stage (ii) Occupation (iii) Economic situation (iv)
Life Style (v) Personality and self concept.
○ Age and Life cycle Stage:-
People change the goods and services they buy over their
lifetimes. Tastes in food, clothes, furniture, and recreation
are often age related. Buying is also shaped by the stage
of the family life cycle.
○ Occupation :-
C. Consumer Psychology: -
The term consumer psychology refers to the study of how people relate to
the goods and services they use in their daily lives. Also known as the study
of consumer behavior, consumer psychology provides opportunities to
examine issues such as what factors are most important when people decide
to purchase a particular item, how customers determine the value of a
service, and whether or not television and magazine advertisements can
convince a reluctant consumer to try a new product for the first time.
Consumer psychology seeks to describe and explain consumer behavior,
although some consumer psychologists will attempt to predict or influence a
customer’s decisions.
The discipline of consumer psychology draws heavily from the fields of
marketing, advertising, economics, anthropology, social psychology, and
cognitive psychology. However, consumer psychology has been recognized
as its own area of study since World War II. One of the first noted consumer
psychologists was John B. Watson, the man who suggested that ads for
Johnson & Johnson’s baby powder be structured to subtly play on the
anxiety and insecurity commonly felt by new mothers. His technique of
recognizing the emotional appeal of advertising remains a cornerstone of
consumer psychology today.
Like any other discipline, consumer psychology has several possible areas of
specialization. Some consumer psychologists study the impact of advertising
or product packaging on a consumer’s purchasing decisions. Others focus
their research on how marriage, parenthood, and other important life stages
affect consumer behavior. The psychology of price, or how the perceived
value of an item is determined, is another popular specialty within the field
of consumer psychology.
Consumer psychologists can be researchers, educators, consultants,
managers, and policy makers. A bachelor’s degree in consumer psychology
prepares you for entry-level jobs with advertising agencies, research firms,
governmental institutions, and private corporations that wish to learn more
about how customers interact with a particular product. However, a graduate
degree in marketing, management, or advertising is often necessary before
one can expect to advance within the field.
Career opportunities in consumer psychology offer a chance to interact with
a variety of people while applying problem solving and creative thinking
skills to a number of tasks. A typical day working in the field of consumer
psychology involves brainstorming, analyzing research data, preparing
reports, and meeting with clients. The risk of burnout is quite high, however,
since most professionals are expected to work large amounts of overtime
when an employer is preparing for a product launch.
Product positioning: -
Product positioning is the way users/consumers view competitive brands or
types of products. This can be manipulated by the organization/library. The
library’s video collection, available for free, is competitive with local video
stores that charge, if video collections are comparable. If the collections are
not, the library is differentiating the video collection from the video store.
Mental accounting: -
A concept first named by Richard Thaler (1980), mental accounting
attempts to describe the process whereby people code, categorize and
evaluate economic outcomes.
One detailed application of mental accounting, the behavioral life cycle
hypothesis (Shefrin & Thaler, 1988), posits that people mentally frame
assets as belonging to either current income, current wealth or future
income and this has implications for their behavior as the accounts are
largely non-fungible and marginal propensity to consume out of each
account is different.
MASS MARKETING: -
The traditional argument for mass marketing is that it creates the largest
potential market, which leads to the lowest costs, which in turn can translate
into either lower prices or higher margins. However, many critics point to the
increasing splintering of the market, which makes mass marketing more
difficult. According to Regis McKenna:
Consumers have more ways to shop: at giant malls, specialty shops, and
superstores; through mail-order catalogs, home shopping networks, and
virtual stores on the Internet. And they are bombarded with messages
pitched through a growing number of channels: broadcast and narrow-cast
television, radio, on-line computer networks, the Internet, telephone
services such as fax and telemarketing, and niche magazines and other print
media.
SEGMENT MARKETING: -
NICHE MARKETING: -
While segments are fairly large and thus normally attract several
competitors, niches are fairly small and normally attract only one or a few
competitors. Niches typically attract smaller companies. Larger companies,
such as IBM, whose lose pieces of their market to nichers; Dalgic labeled
this confrontation as "guerrillas against gorillas." As a defense, some larger
companies have turned to niche marketing, which has required more
decentralization and some changes in the way they do business. For
example, Johnson & Johnson consists of 170 affiliates (business units), most
of which pursue niche markets.
LOCAL MARKETING: -
Target Markets: -
A target market is the market segment which a particular product is
marketed to. It is often defined by age, gender and/or socio-economic
grouping.
Brand: -
Brand is a unique and identifiable symbol, association, name or trademark
which serves to differentiate competing products or services. Both a physical
and emotional trigger to create a relationship between consumers and the
product/service.
Branding: -
“Branding is endowing products and services with the power of brand.”
Branding involves creating mental structures and helping consumers
organise their knowledge.
Brand Extension: -
Brand extension is the application of a brand beyond its initial range of
products, or outside of its category. This becomes possible when the brand
image and attributes have contributed to a perception with the
consumer/user where the brand and not the product is the decision driver.
Brand Reinforcement: -
Brand Reinforcement is the activity associated with getting consumers who have
tried a particular brand to become repeat purchasers and with attracting new users;
brand reinforcement is a key objective of the growth stage of the product's life
cycle.
Brand portfolio: -
Some companies have multiple products and services, each of which may
have its own brand (trademark, service mark), or form part of a "family of
brands." They may be common law marks, or registered under statutes in
various countries and states. The total collection of these rights is called the
"brand portfolio."
Brand Equity: -
Brand equity is the value - both tangible and intangible that a brand adds to
a product/service.
OR
The differential effect that brand knowledge has on consumer response to the
marketing of that brand.
Brand Resonance: -
The first level of the pyramid deals with establishing the identity of the
brand. Keller suggests a single building block for this phase and terms it
brand salience. In building a highly salient brand, he argues that it is
important that awareness campaigns not only build depth (ensuring that a
brand will be remembered and the ease with which it is) but also breadth
(the range of situations in which the brand comes to mind as something that
should be purchased or used).
Richard Branson’s Virgin brand has achieved depth of awareness and is
easily recognized and recalled in South Africa. The challenge facing the
brand is to make consumers aware about its breadth and diversity of
offerings including air travel, game lodges, finance, health clubs, drinks, and
mobile communication. Follow the Virgin brand around the globe, and that
challenge stretches to books, trains, cosmetics, jewellery, wines, radio, and
even space flights in the next few years. The second layer of the
pyramid deals with giving meaning to the brand and here Keller presents
two building blocks: brand performance and brand imagery.
Brand performance is the way the product or service attempts to meet the
consumer’s functional needs. Brand performance also has a major influence
on how consumers experience a brand as well as what the brand owner and
others say about the brand.
Delivering a product or service that meets and, hopefully, exceeds consumer
needs and wants is a prerequisite for successful brand building. In
communicating brand performance, Keller identifies five areas that need to
be communicated: primary ingredients and supplementary features; product
reliability, durability and serviceability; service effectiveness, efficiency and
empathy; style and design; and price
Brand imagery deals with the way in which the brand attempts to meet
customers’ psychological and social needs. Brand imagery is the intangible
aspects of a brand that consumers pick up because it fits their demographic
profile (such as age or income) or has psychological appeal in that it
matches their outlook on life (conservative, traditional, liberal, creative, etc).
Brand imagery is also formed by associations of usage (at work or home) or
via personality traits (honest, lively, competent, rugged, etc).
It is in this building block that advertising plays a major role in shaping the
image of the brand, although word-of-mouth recommendations and a
consumer’s own experience are equally important. However brand imagery
is built, it is important that brand managers and strategists craft strong,
favorable and unique associations for a brand.
Luxury cars, BMW in particular, are brands that work hard to communicate
brand performance and imagery. Sales people, brochures, Internet sites and
car journal reviews will all tell you about the performance of a BMW. The
delivery of this type of communication has largely remained consistent, only
being updated at regular intervals to reflect the specifications of new
models. What has changed is the imagery used to communicate the brand
from the power-impregnated advertisements of a BMW outrunning a land
speed rocket car to the more esoteric imagery of innovative kinetic
sculptures being powered by the wind. The change in advertising imagery
reflects a shift by the German automaker away from targeting the affluent
automobile enthusiast to targeting the “ideas class”, a market segment
which comprises up-market buyers more interested in design and innovation
than brute performance.
Having dealt with brand identity and meaning, we move upwards to the
third tier of the pyramid to develop a consumer response to the brand.
Keller proposes two building blocks for this tier, namely brand
judgments and brand feelings. Judgments about a brand
emerge from a consumer pulling together different performance and imagery
associations. These judgments combine into a consumer’s opinion of a brand
and whilst there are multiple judgments that an individual can make, Keller
believes there are four that companies must pay attention to in their brand-
building efforts. They are the perceived quality of the brand; brand
credibility (the extent to which the brand is perceived as having expertise,
being trustworthy and likable); brand consideration (the brand must be
relevant to the consumer so that they are likely to purchase or use it); and
brand superiority (the extent to which consumers view the brand as being
unique and better than other brands).
Maintaining brand judgement is particularly important when a company
embarks on brand extension as what counted as quality, credibility,
consideration and superiority in one market can evaporate as the brand
extends its product line and/or market reach. Baby food manufacturer
Gerber tried to enter the adult food market in the 1970s by producing small
helpings of fruits, vegetables, desserts, etc in the same jars it used for infant
food. Unable to garner credibility (adult food is very different to baby food),
consideration (how many adults would think about buying food for
themselves that is packaged in a well-established baby-food jar) and
superiority (many other brands specialize in adult food) for its new product
range, Gerber quickly ditched which was widely regarded as a spectacular
failure.
Whereas brand judgments can be fairly logical, brand feelings are
consumers’ emotional responses to the brand. Keller identifies six brand-
building feelings that he regards as important emotions that a consumer can
have towards a brand, namely warmth, fun, excitement, security, social
approval and self-respect.
The first three are experiential and immediate and increase in the level of
intensity whilst the latter three are private and enduring and increase in the
level of gravity. These responses are likely to come together in different
combinations for individual consumers and the distinct brands they are
relating to.
What is important for the brand manager and strategist is that responses
are positive and come to mind when a consumer thinks about the brand.
Telecommunication companies often depict the emotional rewards of making
a call such as a child bringing joy to his or her geographically-distant
grandparents by speaking to them on the phone. Fun is a major component
of brand communication with well-known South African examples such as
Castrol’s “Boet and Swaer” and “Mad About Oil” campaigns and Vodacom’s
“Yebo Gogo” and “Meerkat” campaign. Volvo plays on the brand feeling of
security by emphasizing the safety of its cars. Investment management firm
Allan Gray also targets the feeling of security by emphasizing the long-term
performance of the investments it makes on behalf of its clients.
The final tier of the pyramid deals with the consumer’s relationship
with the brand and here Keller introduces the sixth building block which he
calls brand resonance. Resonance is characterized by the intensity of
the psychological bond that customers have with the brand and their level of
engagement with the brand. The challenge for the brand manager and
strategist is to develop the bond and increase the number of interactions
(repeat purchases of a product or service) through the development of
marketing programmes that fully satisfy all the customers’ needs, provides
them with a sense of community built around the brand and even empowers
them to act as brand champions.
Along with Apple, Harley-Davidson is a brand that succeeds in creating a
strong and lasting bond with its customers. The motorcycle manufacturer’s
primary vehicle for achieving this is the global Harley Owners Group, known
affectionately as HOG, which organizes regular events for its more than
600,000 members. Executive from the company often join these rides, which
can number up to 25,000 riders, which successfully reinforce the brand’s
message of freedom, individualism, self-expression, etc as well as building
the sense of community that the brand creates. Harley-Davidson customer
are famously loyal with over 45 percent of owners having previously owned
one of the brand’s distinctive motorcycles.
In wrapping up this review of the pyramid model, it is useful to heed Keller’s
advice not to take shortcuts: “The length of time to build a strong brand will
therefore be directly proportional to the amount of time it takes to create
sufficient awareness and understanding so that firmly held and felt beliefs
and attitudes about the brand are formed that can serve as the foundation
for brand equity.”