Market intelligence: Internal records: • Order to payment cycle must be fast and efficient •Sales data, which must

be interpreted in the right way for your future planning •Marketing Intelligence System: Developments happening in the external market

Macro Environment
• Demographic: includes population growth, populationage mix, literacy rate • Economic environment: How is the income distributed • Socio-cultural environment • Natural environment • Technological environment • Political-legal environment

Macro-environment of India
• Demographic: Population: 1.1 billion (2006 est.) Rural: 742.61 million Urban: Age structure: 0–14 years: 30.8% 15–64 years: 64.3% 65 years and over: 4.9% (2006 est.) Average age of Indians is 26 years Population growth rate: 1.38% Unemployment rate: 9.2% Religions, languages, etc.

Macro environment in India (contd.)
Economic environment • GDP: Crossed $1 trillion in 2007 and growing at 7-8% • Forex reserves: $310.68 billion (RBI) • FDI target for 2008-09: $35 billion, China 42.78 billion in 1st five months • Indian middle class is approx. 30% of its population more than entire population of USA • Rural population is now moving upwards too and becoming a huge potential market e.g. Hero Honda

Macro environment in India (contd.)
• Income distribution (2006-07)

Income class (Rs. p.a.) Rich (>215K) Consuming Class (45-215K) Climbers (22k45k) Aspirants (1622k) Destitute (<16k)

Households 5.2 75.5

Estimated population 30 432

81.7 20.2 16.5

472 117 95

Macro environment in India (contd.)
Socio-Cultural Environment: • General views that people hold about themselves, the environment, society, world, etc. • Diversity in tastes and preferences in your target markets has to be taken into account for products e.g. Spencer Retail has different types of atta in local market in Gujarat, while in Bengal, they have to cater to people’s leanings towards non-veg food Apollo Tyres separate for North & South Dominos is looking to customise its pizza offerings

Macro environment in India (contd.)
Natural Environment: • Companies have to abide either by regulation or when markets become hostile e.g. Coca Cola in Plachimada, Bharat 2 norms followed by car makers. Four trends to be careful about: • Shortage of raw materials • Increasing energy costs • Anti-pollution pressures • Changing role of Government

Segmentation, targetting & Positioning (STP)
Mass Marketing: Mass production, distribution & promotion Market segment: Group of customers with similar needs & wants. Customers may have homogenous, heterogenous or diffused preferences Niche: A more narrowly defined customer group seeking a distinctive set of benefits Local marketing: Customised to local needs Customerisation: Segments of 1 in the market

STP (Contd.)
• 1) • • • • Segmenting consumer markets: Geographic segmentation: Assumes that people in same area share similar needs and wants. India has 5,000 towns and 6,38,000 villages. How to reach this market? What are the consumption patterns and awareness levels, et al? Prahlad’s Bottom of the Pyramid focus Also zones and state-wise segmentation HLL brought in sachets for rural markets

STP (Contd.)
2) Demographic segmentation: • • • • Age & life cycle stage (marital status) Gender Income, education, occupation Generation: Baby Boomers: 1946-64; Gen X: 1965-76, Gen Y: 1977-1994. It gives rise to cohort effects, what time you grew up in affects your behaviour. Most of that behaviour is defined in growing up years. Social class, normally associated with wealth now. Culture & Subculture Cross cultural segmentation

• • •

STP (Contd.)
3) Psychographic segmentation: • Based on psychology, personality traits, lifestyle & values • a) b) c) d) High income groups of four types: Innovators: Niche oriented products Thinkers: Utility based Achievers: Products that demonstrate success Experiencers: Young and impulsive; spend on Fashion, entertainment, socialising

STP (Contd.)
3) Psychographic segmentation (Contd.) • • • • • Low income groups of 3 types: Believers: Conservative, conventional, traditional, loyal to established brands Strivers: Trendy, fun-loving; favour stylish products and try to emulate the rich Makers: Practical and down to earth; favour functionality Survivors: Elderly, passive people, loyal to their favourite brands

STP (Contd.)
• • • i. ii. iii. Behavioural segmentation: Five roles in decision making: Initiator, influencer, decider, buyer, user Behavioural variables: Occasion Benefits sought User status (non-user, ex-user, potential user, firsttime user & regular user)

STP (Contd.)
• iv. v. Behavioural variables (Contd.) Usage rate (light, medium, heavy) Buyer readiness stage: Unaware, aware, informed, interested, desire, ready to buy vi. Loyalty status: Hardcore loyals, split loyals (2-3 brands), shifting loyals and switchers vii. Attitude: Enthusiastic, positive, indifferent, negative and hostile

Targeting
Identifying the worthiness of segments: 1) You should be able to measure the potential 2) You should be able to profitably do business as well as serve the needs of the segment 3) You should be able to adopt unique marketing strategies for the segments

Targetting (Contd.)

M1 P1 P2 P3

M2

M3 P1 P2 P3

M1

M2

M3

Single segment concentration

Selective specialisation

Targetting (Contd.)

M1 P1 P2 P3

M2

M3 P1 P2 P3

M1

M2

M3

Product specialisation

Market specialisation

Targetting (Contd.)

M1 P1 P2 P3

M2

M3

Full market coverage

Positioning

Definition: The act of designing the company’s offering and image to occupy a distinctive place in the mind of the target market

Positioning (continued)
Marketers are supposed to • Points-of-Difference (POD): Attributes that consumers believe cannot be found with another brand. • Points-of-Parity (POP): Associations that are found in other brands as well. Of two types: a) Category POPs: Automatically associated with the product category. b) Competitive POPs: Used to negate competitor’s points of difference.Advisable to establish category membership before establishing PODs

Positioning (continued)
• PODs should be desirable, distinctive and believable. • They should be feasible, enduring • Multiple PODs may be negatively correlated or unrelated, so marketers have to ensure customers do not get confused or alienated

Positioning
Changing lifestyles of people Style, practicality & economy

Small MPV for family
Safety features, space

Concept, mileage, design

Looks, power, luxury. style

Positioning (continued)
• • • • Product differentiation Image differentiation Channel Differentiation Personnel differentiation

Segmentation (contd)

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