The Marketing Process

Understanding the Customer

 Needs: States of felt deprivation such as physical, social, and individual need
 Wants: Forms that needs take as they are shaped by culture and individual personality
 Demands: Wants backed by buying Demands power

Company and Marketing Strategy

 Defining the company mission: Statement of the organization’s purpose
 Setting company objectives and goals: Turn the mission into detailed supporting objectives
 Designing the business portfolio: The best business portfolio is the one that best fits the
company’s strengths and weaknesses to opportunities in the environment
 Planning marketing and other functional strategies: Revolve around creating customer value and
building profitable relationships with important consumer groups

The Microenvironment
1. The Company
 In designing marketing plans, marketing management needs to take other departments such as
finance, R&D, HR etc into account. All the departments share the responsibility for
understanding customer needs and creating customer value.
 Identify and assess the existing and potential resources:
 Quantity and quality of the resources available
 Nature of the resources
 Extend to which the resources are unique
 Strengths or weaknesses

2. The Suppliers
 Need to monitor the supply availability and costs. Shortages, delays or natural disasters can
result in loss of sales in the short run and damage customer satisfaction in the long run.
 Rising supply costs many force prices to increase and harm the company’s sales volume.
 They should be treated as partners in creating and delivering customer value
3. Marketing Intermediaries
 Help the company promote, sell and distribute its products to final buyers
 Resellers: Wholesalers and retailers
 Physical Distribution Firms: Help move company stocks to destination
 Marketing Services Agencies: Marketing research, advertising agencies, media firms and
consultation firms that helps with promotion
 Financial Intermediaries: Banks, credit companies, insurance companies

4. Competitors
 Need to gain strategic advantage by positioning products strongly against competitors’ products
in mind of consumers
 Industry perspective: What Companies are in the Same Industry as You?
 Market perspective: What Companies satisfy the same customer needs as you?
 Assess the competitors’ objectives, strategies, strengths & weaknesses, possible reactions

5. Public
 Any group that has interest in or impact on the firms’s ability to achieve its objectives.
 Financial publics: Influence the firm’s ability to obtain funds
 Media publics: TV stations, newspapers, magazines that carries news, features, editorial
opinions.
 Government publics: Government authorities
 Citizen Action publics: Consumer organizations, environmental groups, minority groups
 Local publics: Neighbourhood residents, community organizations
 General public: General public’s attitude affects its buying behavior
 Internal publics: Workers, managers and board of directors. When internal publics feel good
about the company, they spill positive attitude to the external publics

6. Customers
 Most important actors in the company’s microenvironment
 Consumer markets: Individuals and households that buy goods and services for personal
consumption
 Business markets: Organizations that buy goods and services for further processing or for use in
their production process
 Reseller markets: Firms that buy for reselling purposes
 Government markets: Government agencies that buy goods and services to produce public
services or transfer the goods and services to others who need them
  Business markets in comparison to consumer markets:
 Demand: Derived, Higher Fluctuation | More Inelastic
 Market structure: Fewer and Larger | More Geographically Concentrated
 Design characteristics: More Complex | Larger Sums of Money Involved | More Formal Process,
Higher Buyer and Supplier Dependency
 Nature of buying unit: More Decision Participants | Professional Purchasers Harder to Identify
Decision Participants

The Macroenvironment
Study of human populations in terms of demographic
Trends in Family
Divorce rate | Marriage Rate | Gender Role | Birth Rate
Education & Occupation
Educational Attainment | Service Oriented VS Labour
Demographic forces
Increasing diversity
Nationality | Ethnicity | Disability
Geographic Shift in Population
Migratory movement | Telecommuting
Changing Age Structure
Baby boomer | Gen X | Gen Y
Factors that affect consumer buying power and spending
patterns
Subsistence economies
● consume most of their own agricultural and industrial output

Developing economies
Economic Forces ● Can offer marketing opportunities for right kind of products

Industrial economies
● constitute rich markets for many different kinds of goods

Trends
● Change in Income - Value Marketing (offer greater value)
● Change in Spending patterns
 Shortage of raw materials | Increased population |Increased
Natural Forces government intervention in natural resource management
● Environmental Sustainability

Creates new products and opportunities

Technological Forces
● Practical & affordable products to be commercialized
Laws | Government agencies | Pressure groups
Legislation regulating business
● Increased legislation
Political & Social Forces
● Changing government agency enforcement

Increased emphasis on ethics and socially responsible actions

● Socially responsible behavior
Basic beliefs and values and perception
Cultural Forces
● Affects their behavior

Customer-Driven Marketing Strategies

Segmentation

● Demographic: Generation | Gender | Occupation | Income | Religion | Race | Nationality | Age

● Psychographic : Social Class | Lifestyle | Personality Traits | Values | General Attitudes
● Behavioral : Occasions | Benefit Sought | User Rate | User Status | User Rate | Loyalty Status
● Geographic: Region | states | Countries

Segmentation - Business

● Industry | Company Size | Benefit Sought | User Status | User Rate | Loyalty Status | Operating
Characteristics | Purchasing Approaches | Situational Factors | Personal Characteristics

Requirements for Effective Segmentation

Measureable The size, purchasing power and profiles can be measured

Accessible can be effectively reached and served

Substantial profitable enough

distinguishable and respond differently to different marketing mix

Differentiable
elements and programs

Actionable can be designed for attracting and serving the segments

Targeting

Step 1: Evaluating Market Segments

 Segment size and growth: Sales Revenue | Growth Rate | Expected Profitability
 Structural factors: Types of Competitors | Number of Competitors | Power of Buyers/Sellers
 Objectives and resources: Long-Term Objectives and Strategies | Skills and Resources

Step 2: Choose a Targeting Approach

Factors to Consider before Choosing Target Approach:

Socially Responsible Target Marketing: Concern for Vulnerable and Disadvantaged Segments | Benefit
Customers with Specific Needs | Hypertargeting Can Benefit and Harm Consumers

Differentiation and Positioning

 Use of Perceptual Positioning Maps that shows perceptions of their brands compared to
competitors’ on important buying dimensions
 Choosing a Differentiation and Positioning Strategy:

Step 1: Identifying Possible Customer Value Differences & Competitive Advantages

Step 2: Choosing the Right Competitive Advantages

Step 3: Selecting an Overall Positioning Strategy

Step 4: Developing a Positioning Statement

Alternative Model:

Marketing Mix – Product

 There are Three Levels Of Product/Services:
 Core Customer Value: Address the reason of buyer’s purchase.
When designing new-products, Marketers must first define the
core. (e.g. problem-solving benefits that consumers seek)

 Actual Product: Product Planners develop the Features, Design,

Packaging, Quality Level, Brand Name. Combine these attributes
to deliver the Core Benefits of _______.

 Augmented Product: Finally, Product Planners offer additional consumer benefits/services.

Bundle of benefits such as After-Sales, Warranty, Installation, Delivery aim to provide a most
satisfying customer experience.

Product and Service Decisions

1. Product and Service Attributes

 Product Quality: Two dimensions – level (performance quality) and consistency (conformance
quality)
 Product Features: Competitive tool for differentiating company’s product from competitors
 Product Style & Design: Style – simply appearance, Design – contributes to product usefulness

2. Branding
 Can add value. Customers attach meanings to brands and develop brand relationships.
 Helps consumers identify products that might benefit them.
 Says something about product quality and consistency
 Helps sellers segments the market, build trust through brand loyalty, legal protection, command
a price premium, market expansion, effective communication
  Companies can position brands using product attributes, product benefits, product beliefs and
values
 Desired qualities of a brand name:
 Suggest Benefits and Qualities
 Easy to Pronounce, Recognize, and Remember
 Distinctive for the Product Category
 Extendable to Other Product Categories
 Translatable for the Global Economy*
 Can be Registered and Protected Legally

3. Packaging
 Good Attributes: user-friendly, attractive, functional, safe, environmentally-friendly
 Innovative packaging can give company an advantage over competitors and boost sales
 Superior packaging design signals quality and makes imitation more difficult
 Creates immediate recognition of brand
 Over-packaging not encouraged as it creates incredible amount of waste

4. Labeling
 Identifies product or brand
 Promote the brand, support its positioning and connect with customers
 Can contain unit pricing, open-dating, nutritional labeling, safety warnings etc.
 Should be informative, attractive and truthful (not misleading), abide rules and regulations

5. Product Support Services

 Support services are what keeps customers happy after the sale and is the key to building lasting
relationships
 Survey customers periodically to assess the value of current services and obtain new ideas
 Sharing how-to videos

Product Line Decisions

 A group of products that are closely related – similar price & functions, same customers, outlets
 Product line length: Number of items in the product line
 Company can expand its product line in two ways: line filling or line stretching
 Line filling – adding more items within the present range of the line
 Line stretching – lengthening product line beyond current range by stretching upwards (add
prestige) or downwards (faster growth in low-end segments) or both ways
Product Mix Decisions

 Consists of all the product lines and items

 4 product mix dimensions:
 Product mix width: Number of product lines
 Product mix length: Total number of items a company carries within its product lines
 Product mix depth: Number of versions offered for each product in the line
 Consistency: How closely related the various product lines are

Services Marketing

 Service Intangibility: Services that cannot be seen, tasted, felt, heard or smelled before purchase
(eg. Cosmetic surgery, airline tickets)
 To reduce uncertainty, buyers look for signals of service quality. The draw conclusions about
quality from the place, people, price, equipment, and communications they see
 Service Inseparability: Services that are produced and consumed at the same time and cannot
be separated from their providers (a provider-customer interaction affects the service outcome)
 Customer coproduction makes provider-customer interaction a special feature of services
marketing
 Service Variability: The quality of services may vary depending on who provides them, when,
where and how they are provided (eg. different staff have different behavior, traits and
attitudes)
 Service Perishability: Services that cannot be stored for later sale or use (eg. doctors charge for
missed appointments, changing hotel prices to suit off-season to attract more guests due to
spare capacity, hiring during peak)

Brand Development

 Line Extension
 Extending an existing brand name to new forms,
colors, sizes, ingredients or flavors of an existing
product category
 As a low cost, low risk way to introduce new
products, meet customer desires for variety, use
excess capacity, command more shelf space from
resellers
 Overextended brand might cause consumer confusion or lose its specific meaning (e.g. Coke
Light, Coke Zero, Coke C2 all are no-calorie versions) or come at an expense of other items in the
product line (e.g. Hershey Kisses morphed into Rich Dark Chocolate, Caramel Kisses
‘cannibalizes’ the company’s other products)
  Brand Extension
 Give new product instant recognition, faster acceptance (e.g. Handheld DS from Nintendo)
 Saves higher advertising costs to build new brand name
 But involves higher risks of confusing image of main brand, harming consumer attitudes toward
other products carrying the same brand name, not appropriate for the particular new product
(e.g. Heinz Pet Food)

 Multibrands
 Establish different features and appeal to different buying motives (e.g. P&G Shampoos)
 Obtain only small market share where non may be very profitable, spreading resources over
many brands instead of building a few brands to a highly profitable level
 Company should reduce number of brands and set up tighter screening procedures for new
brands

 New Brands
 Power of existing brand is waning and a new brand is required or create new brand name when
it enters a new product category as none of the current brand names are appropriate (e.g.
Toyota created Scion brand targeted toward Gen Y consumers)
 Offering too many new brands might result in company spreading its resources too thin, too
many brands with little differences
 Should weed out weaker brands and focusing on brands that can achieve number-one or
number-two market share positions in their categories (e.g. Procter and Gamble)

The Buyer Decision Process for New Products

1. Relative Advantage: Value for consumers?

2. Compatibility (eg. Chocolate pizza)
3. Complexity
4. Divisibility
5. Communicability

Product Life Cycle Stages

 Product Development, Introduction, Growth, Maturity, Decline (Page 306-310)

Marketing Mix – Price

Major Pricing Strategies

1. Cost-Based Pricing
 Company designs what it considers to be a good product, adds up the cost of making, sets a
price that covers cost plus a target profit.
 Then convince buyers that the product’s value at that price justifies its purchase
 2. Value-Based Pricing
 Setting prices based on buyers’ perceptions of value rather than on the seller’s cost
 Value-based Pricing means that the Marketer cannot design a Product and Marketing Program
and then set the Price
 Price has to be considered along with the other Marketing Mix Variables before the Marketing
Program is set
 Company first assess customer needs and value perceptions then
set its target price based on customer perceptions of value
 The targeted value and price drive decisions about what costs can
be incurred and the resulting product design. Price is set to match
the perceived value
 Great-Value Pricing: Offering the right combination of quality and
good service at a fair price
 Value-Added Pricing: Rather than cutting prices to match competitors, attach value-added
features and services to differentiate offers and thus support their higher prices (more for more)

3. Competition-Based Pricing
 Setting prices based on competitors’ strategies, cost, prices and market offerings.
 If faced with smaller competitors charging higher prices, company can charge lower prices to
drive weaker competitors out of market
 If faced with larger competitors charging lower prices, company may decide to target unserved
market niches with value-added products and services at higher prices

Pricing Considerations

Attract new customers | Profitably retain existing customers | Prevent competition from entering |
Stabilize the market and avoid price wars | Help sales of other products | Avoid government
intervention | Keep loyalty and support of resellers

New Product Pricing Strategies

 Market Skimming Pricing: Set high initial prices to skim revenue layer by layer
 Considerations:
1. Product’s quality and image must support its higher price
2. Costs of producing a smaller volume cannot be so high that they cancel the advantage of
charging more
3. Competitors should not be able to enter the market easily and undercut the high price
 Market Penetration Pricing: Set low initial price to attract large number of buyers quickly and
win a large market share
 High sales volume result in falling costs, allowing companies to cut their prices even more
 Considerations:
1. Market must be highly price sensitive so that a low price produces more market growth
2. Production and distribution costs must decrease as sales volume increases
3. Low price must help keep out completion, and the penetration price must maintain its low price
position.
Product Mix Pricing Strategies

 Product Line Pricing: Different prices for different product/service in a product line (eg. Concert
tickets, manicure, shampoo)
 Optional Product Pricing: Offering to sell optional or accessory products along with main product
(eg. Car and navigation system)
 Captive Product Pricing: Products that must be used along with main product
(eg. Printer and ink)
 By-product Pricing: When by-product have no value and disposing them is costly (eg. Turning
trash into cash)
 Product-Bundle Pricing: Combining several products and offer the bundle at a reduced price (eg.
Bundle tv service, phone service)

Price Adjustment Strategies

 Discount and Allowance Pricing: Cash Discount | Bulk Purchase Discount | Functional Discount |
Seasonal Discount | Trade-in Allowances | Promotional Allowances
 Segmented Pricing: Customer-segment Pricing | Product-form Pricing (eg. flight) | Location-
based Pricing |Time-based Pricing
 Psychological Pricing: Psychology of Prices (eg. perfume) | Reference Prices
 Promotional Pricing: Use of “loss leaders” | Special Event Pricing | Limited Time Offers | Flash
Sales | Cash Rebates | Low-interest Financing | Longer Warranties | Free Maintenance
 Geographical Pricing: Uniform-delivered Pricing | Zone Pricing | Basing-point Pricing | Freight-
absorption Pricing
 Dynamic and Internet Pricing: Adjusting prices continually based on demand etc (eg. Airlines,
hotels, online auction, showrooms)

Marketing Mix – Place

 Upstream Partners: A set of firms that supply the raw materials, components, information,
finances etc. to create the product/service.
 Downstream Partners: A set of firms that make up the distribution channels that bridge the
company to their customers. Marketers tend to focus on Downstream side of the supply chain.
 Value Delivery Network: The network is made up of the company, suppliers, distributors,
customers who partner with each other to improve the performance of the entire system.

Channel Design Decisions

Step 1: Analyzing Consumer Needs

 Consider what consumer wants from channel (eg. Convenience and speed, product mix, add-o
services, purchase and payment methods)
 Consider whether company has resources or skills to satisfy those needs
 Balance among consumer needs, feasibility and costs, and consumer price preferences
Step 2: Setting Channel Objectives

 State marketing channel objectives in terms of targeted levels of customer service

 Identify different levels of services required by different segments
 Evaluate the nature of the company and its products (e.g. perishables need more direct
marketing), marketing intermediaries, target segments, competitors and the economic
environment (e.g. during recession, need to be more economical with shorter channels)

Step 3: Identifying Major Alternatives

 Types of Intermediaries: Manufacturers | Wholesaler | Distributors | Dealers | Retailers

 Number Of Intermediaries: Intensive | Selective | Exclusive
 Responsibilities Of Channel Members: Agreement on the Terms and Responsibilities of Each
Channel Member | Price Policies | Conditions of Sale | Territorial Rights and Specific Services to
be Performed by Each Party | List of Price | Fair Set of Discounts | Mutual Services and Duties

Step 4: Evaluating Major Alternatives

 Economic Criteria: Compare likely sales, costs, profitability of different alternatives

 Control Criteria: Using intermediaries means giving some control over the marketing
 Adaptive Criteria: Keep the channel flexible enough to adapt to environmental changes

Types of Retailers

We can classify the types of retailers according to 3 categories:

1. Amount of Service
 Self-service Retailers: Perform their own locate-compare-select process. For convenience goods
(eg. Supermarkets)
 Limited-service Retailers: Provide more sales assistance because customers need information
 Full-service Retailers: Usually carry more specialty goods for which customers need or want
assistance or advice (eg. High-end specialty stores and first class department stores)
2. Product Line
 3. Relative Prices
 Discount Store: Sell standard merchandise at lower prices by accepting lower margins and
selling at higher volume (e.g. Daiso, Value$, Wal-mart)
 Off-Price Retailer: Buy at less-than-regular wholesale prices and sell at less than retail (Factory
Outlets/ Warehouse Club)
 Independent Off-Price Retailer: Either owned and run by entrepreneurs or is a division of a
larger retail corporation
 Factory Outlet: Owned and operated by a manufacturer and that normally carry the
manufacturer’s surplus, discontinued or irregular goods. Dozens group together in Factory
Outlet Malls/Value-Retail Centers.
 Warehouse Club: Sell a limited selection of brand name grocery items, appliances, clothing and a
hodgepodge of other goods at deep discounts to members who pay annual membership fees

Types of Wholesalers

Page 432-423

Marketing Mix – Promotion

Promotion Mix/ Marketing Communications Mix

 Advertising: Any paid form of non-personal presentation and promotion of goods/services/ideas

by an identified sponsor
(Tools: Newspaper | Television | Radio | Magazines | Direct Mail | Inside and Outside Transit |
Broadcast | Print | Online | Mobile | Outdoor | Other Forms)
 Sales Promotion: Short-term incentives to encourage the purchase and sale of product/service
(Tools: Discounts | Coupons | Displays | Demonstrations | Refunds or Rebates | Samples | Gifts
Contests | Bonus Packs or Multipacks | Special Events | Referral Gifts | Frequent Shopper Gifts)
 Public Relations: Building good relations with the company’s various publics by obtaining
favorable publicity, building up a good corporate image and handling or heading off unfavorable
rumors, stories and events. Stronger impact and more believable than advertisements.
(Tools: Press Releases | Written Materials | Audiovisual Materials |Special Events | Corporate
Identity | Public Service Activities)
 Personal Selling: Personal customer interaction by the firm’s sales force for the purpose of
making sales and building customer relationships
(Tools: Sales Presentation | Trade Shows | Incentive Programs)
 Characteristics: Personal Interactions Help Build Customer Relationships | Tailored to the
Individual Customer | More Effective than Advertising in Complex Selling Situations | Long-Term
Commitment | Needed Expensive Promotion Tool
 Direct and Digital Marketing: Engaging directly with carefully targeted individual consumers to
obtain an immediate response and cultivate lasting customer relationships – the use of direct
mail, the telephone, direct-response television, email, the Internet, and other tools to
communicate directly with specific consumers
 (Tools: Direct Mail & Catalogs Marketing | Telemarketing | Face-to-face Selling | Kiosk
Marketing |Online Direct Marketing | Social Media Marketing| Mobile Marketing | Direct-
response Television Marketing)
 Benefits of Direct Marketing: Powerful Tool to Build Customer Relationships | Cost Effective and
Speedy | Greater Flexibility| Gives Access to Inaccessible Buyers

Integrated Marketing Communications

Step 1: Identifying Target Audience

 Clear target audience and their characteristics in mind

 Can be potential buyers or current users/ those who make the buying decision or influence it
(e.g. children) and can be individuals, groups or publics
 Affects marketer’s decisions on: content, context, timing, media, communication

Step 2: Determining the Communication Objectives (Pg 454-455)

 Determine the desired response of the target audience (e.g. Awareness/ Purchase)
 Types of objectives: Inform customers | Persuade customers | Compare to competitors |
Remind customers | Build relationships and loyalty | Improve the brand image | Incentivize
channel partners
 Buyer-Readiness Stages: The stages consumers normally pass through on their way to purchase.
The target audience may be in any of these 6 stages:

 Use promotion mix tools to create positive feelings and conviction. Use of TV commercials to
help build anticipation and an emotional brand connection. Images and videos on Facebook,
YouTube, Pinterest etc engage potential buyers and demonstrate the product’s use and
features.
 Press releases and other PR activities can help keep the buzz going about the product.
 Finally, some people would be convinced but not quite purchase the product. To help reluctant
customers, company can offer buyers special promotional prices and upgrades, support the
product with positive reviews on its web and social media pages.

Setting the Total Promotion Budget and Mix (Used in Step 2)

1. Affordable Method
 Setting the promotion budget at level management thinks the company can afford
  Completely ignores the effects of promotion on sales, leads to an uncertain annual promotion
budget, more often results in under spending e.g. small businesses

2. Percentage-of-Sales Method
 Setting the promotion budget at a certain percentage of current or forecasted sales or as a
percentage of the unit sales price
 Simple to use, helps management to think about the relationship between promotion spending,
selling price and profit per unit
 Wrongly view sales as the cause of promotion, does not provide any basis for choosing a specific
percentage
 Based on availability of funds rather than on opportunities

3. Competitive-Parity Method
 Setting the promotion budget to match competitors’ outlays
 Monitor competitors and set budget based on industry average

4.Objective-and-Task Method
 Setting the promotion budget by
 Defining specific promotion objectives
 Determining the tasks needed to achieve these objectives
 Estimating the costs of performing these tasks where the sum of these costs is the proposed
promotion budget
 Forces management to spell out its assumptions about the relationship between dollars spent
and promotion results
 Difficult as hard to figure out what specific tasks will achieve stated objectives

Step 3: Designing a Message

 AIDA Model (Desirable Qualities of a Good Message):

 Get Attention | Hold Interest | Arouse Desire | Obtain Action
1. Message content:
 Rational Appeal: Relates to consumer self-interest, showing that product will produce the
desired benefits (e.g. Panadol Flumax/ Strepsils ad)
 Emotional Appeal: Stir up either positive or negative emotions that can motivate purchase (e.g.
Safety & Security, Family Closeness, Patriotism, Optimism, Giving To Others)
 Moral Appeal: Directed at consumers’ sense of what is right and proper (e.g. Salvation Army/
Anti-Gambling ad)
2. Message structure:
 Draw a Conclusion or Leave with a question for consumers to ponder
 Presenting strongest arguments First or Last (Presenting first gets strong attention but may lead
to an anticlimactic ending)
 Presenting 1-sided argument or 2-sided argument (e.g. 2-sided: ‘Listerine tastes bad twice a
day’)
 3. Message format
 Print Ad: Use Novelty & Contrast | Eye-catching Illustrations | Pictures & Headlines | Distinctive
Formats | Message Size & Position | Color | Shape Movement
 Radio: Choice of Words | Sounds| Voices
 Television: Body Language (Facial Expression | Gestures | Dressing | Posture | Hairstyles etc),
Novelty & Contrast | Eye-catching Illustrations | Pictures | Message Size & Position | Color |
Shape | Movement
 Product/Packaging: Texture | Scent | Color | Size | Shape

Step 4: Choosing Media

Choosing Media Factors to Consider

1. Reach: A measure of the percentage of people in the target market who are exposed to the ad
campaign during a given period of time
2. Frequency: A measure of how many times the average person in the target market is exposed to
the message
3. Impact: The qualitative value of a message exposure through a given medium
4. Engagement: The level of interactivity of the media for the audience

 Personal Communication Channels

 Channels through which two or more people communicate directly with each other (e.g. Face-
to-Face, Phone, Mail/Email, Internet Chat)
 Effective as it allows personal addressing and feedback
 Employees (e.g. Salesperson, Surveyors)
 Cultivate Opinion Leaders by supplying influencers with the product on attractive terms or by
educating them so they can inform others in their communities through Buzz Marketing (e.g.
Famous Bloggers/ Fashion)
 Independent experts: Critics, Experts, Online Reviews/Guides making statements
 Word-Of-Mouth Influence from friends, family and acquaintances

 Non-Personal Communication Channels

 Media that carry messages without personal contact or feedback
 Can emulate and stimulate Personal Communication through embedding consumer
endorsements, celebrities or word-of-mouth testimonials in ads
 Print Media (e.g. Newspapers | Magazines | Mail | Flyers etc.)
 Broadcast Media (e.g. Television | Radio | SMS Blast etc.)
 Display Media (e.g. Billboards | Signs | Posters etc.)
 Online Media (e.g. Social Media | E-mail Blast | Websites etc.)
 Atmospheres: Designed environments that create or reinforce the buyer’s leanings toward
buying a product/service (e.g. Lawyer’s Office evoke confidence)
 Planned Events: Staged occurrences that communicate messages to target audiences (e.g.
Guerilla Marketing | Press Conferences | Grand Openings | Exhibits | Public Tours | Sponsored
Events etc.)
  Opinion Leaders bridge mass media and audiences and carry messages to people who are less
exposed to media. Mass communicators should also aim their messages at opinion leaders,
letting them propel messages to their communities.

Step 5: Selecting the Message Source

 Highly credible or influential sources to deliver the message as they tend to be more persuasive
(e.g. Dentists to recommend Colgate, Athletes endorse Nike/Adidas, celebrity endorsements)
 Tarnished image of endorsers can adversely affect the brand’s own image.

Step 6: Collecting Feedback

 To analyze the effectiveness of the message, whether the target audiences have progressed
along the Buyer-Readiness Stages
 Awareness → Knowledge → Liking → Preference → Conviction → Purchase
 Effectiveness in understanding consumers recall and recognition, attitude towards message,
attitude towards brand, changes in purchase intention and word-of-mouth behaviour
 Collect feedback through researching its effects on the target audience how much of the market
becomes aware, tries the product and is satisfied in the process
 Suggest changes in the promotion program or in the product offer itself
 Sales and profit effect: Ways to measure
 Compare past sales and profits with past advertising expenditures.
 Test the effects of different advertising spending levels

Assessing Marketing Information Needs

 Amount of Information
 Availability of Information
 Budget Availability and Costs

Developing Market Information

 Internal Data: Data sources within the company network
 Marketing Intelligence: Publicly available information about the marketing environment
 Marketing Research: Data relevant to a specific marketing situation

Steps for Segmenting, Targeting, Positioning and Differentiation

Step 1: Segment the Market – Demographics, Geographics, Behavioural, Pschographics (after thinking
through MASDA)

Step 2: Identify Potential Market Segments (eg. female working adults and male working adults)
Step 3: Evaluate Market Segments (Segment Size & Growth, Structural factors, Objectives &
Resources)

Step 4: Choose Targeting Approach (Undifferentiated, Differentiated, Niche, Micromarketing)

Step 5: Select Target Segment (eg. female working adults) – after considering 5 factors (resources…)

Step 6: Position Product Based on Chosen Target Segment (4 steps + compare positioning with
competitors)

Step 7: Differentiate Product Based on Positioning (product differentiation, service differentiation etc)

 Can choose to do differentiation first then positioning, but this is focusing on company’s
strengths which may not be what the consumers want
 Starting with positioning is the better way (customer-driven approach) because starting with a
position for the product, company try to differentiate the product, it will reinforce brand image

IMC: Must take into consideration the information given in the case. Give specifics on
recommendations – eg. on the use of social media (eg. Facebook), how to reach out to target segment
effectively and why it will work? Link the steps – eg. how the choice of media will meet objectives.