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Vorlesung 3

Wintersemester 1999 Leitung: Prof. Dr. Miroslaw Malek Betreuer: Peter K. Ibach
TE - III - M - 1

• • • • • • • • • • • • The Marketing Concept Customer and Marketing Orientation Market Opportunity Analysis (MOA) Sources of Information for MOA Consumer Profiles Marketing Implications of Product Characteristics Profile of Competitors Marketing Mix Variables Marketing Channels Promotion Mix Tools Promotion Tools Strengths and Weaknesses Advantages and Disadvantages of Major Advertising Media

TE - III - M - 2

III .THE MARKETING CONCEPT Customer Orientation Customer Needs & Wants Success Organizational Integration Goal Achievement TE .M .3 .

4 .M .INDICATORS OF CUSTOMER AND MARKETING ORIENTATION 1) What information do you carefully collect about the exact needs of your customer ? 2) Could you consider custom designing your services or products for smaller groups of customers ? How ? 3) Are your (nonsales) employees specifically trained to represent your company to customers ? How ? 4) Are customers contacted after the sale to determine their level of satisfaction ? How ? TE .III .

5 .M . equal team member ? 7) To what extent do you build your strategies around an in-depth understanding of your customers ? 8) To what extent are activities of different people (or departments) coordinated to ensure customer satisfaction ? TE .INDICATORS OF CUSTOMER AND MARKETING ORIENTATION (continued) 5) How do you convert unsatisfied customers to satisfied customers ? Do you have any strategy? 6) Is your top marketer in the company a top-level.III .

MARKETING MANAGEMENT AND ENTREPRENEURSHIP Risk taking Organizational mission Market opportunity analysis Creativity Venture idea identification. innovation. and exploiting opportunity Creating value Business plan development Marketing strategy Assembling/ integrating resources Target market Marketing objectives Environmental scanning Marketing program Team building Managing growth Implementation/control TE .6 .III .M .

M . – – – – – Type of industry Size -now and in 3-5 years Types of marketing practices Major trends Implications for opportunity TE . related R&D) Relevant social changes Natural environment (shortages ? vulnerabilities ?) • 2. Identify the business environmental forces. – – – – – Economic conditions and trends Legal and regulatory situations and trends Technological positioning and trends (state of the art.III .THE FIVE STEPS TO ANALYZING MARKET OPPORTUNITY • 1. Describe the industry and its outlook.7 .

promotion. as seen by customers) – Market practices: channels.8 . service – Estimated market share (if relevant) – Reactions to competition – Implications for opportunity TE . pricing.M .THE FIVE STEPS TO ANALYZING MARKET OPPORTUNITY (continued) • 3. Analyze the key competitors – Product description – Market positioning (relative strength and weaknesses.III .

THE FIVE STEPS TO ANALYZING MARKET OPPORTUNITY (continued) • 4. Set sales projections – As many formal or intuitive approaches as possible – Comparison of results – Go/ no go TE .9 .M . Create a target market profile.III . – – – – – – – – – Levels: generic needs. also channel members Targeted customer profiles Who are my potential customers ? What are they like as consumers/businesspeople How do they decide to buy / not buy ? Importance of different product attributes ? What outside influences affect buying decisions? Implications for opportunity ? • 5. product type. specific brands End-user focus.

10 .III .M .SOURCES OF INFORMATION FOR MARKET OPPORTUNITY ANALYSIS (MOAS) • Published Sources – – – – – Periodicals and newspapers Trade association reports Standardized information service reports Government documents Company reports • Personal observation – Of customers – Of competitors – Of macroenvironmental influences TE .

11 .SOURCES OF INFORMATION FOR MARKET OPPORTUNITY ANALYSIS (MOAS) (continued) • Interviews with experts – – – – – Managers of suppliers Managers of trade companies Managers of trade associations Consultants Salespersons • Primary marketing research – Cross-sectional surveys – Longitudinal panels – Experiments TE .M .III .

M .TYPES OF ADOPTERS BY ADOPTION TIME REQUIRED Proportion of eventual adopters 34% 13 % 1/2 2 / 2% 1 34 % Innovators Early adopters Early majority Late majority Laggards % 16 Time to adoption decision TE .III .12 .

COMPARATIVE PROFILES OF THE CONSUMER INNOVATOR AND THE LATER ADOPTER Characteristic Product interest Innovator More Noninnovator (or later adopter) Less Less Closed-minded Other-directed Narrow categorizer Less More Opinion leadership More Personality Dogmatism Social character Category width Venturesome Perceived risk Purchase and consumption traits Brand loyalty Deal proneness Usage Open-minded Inner-directed Broad categorizer More Less Less More More TE .13 More Less Less .M .III .

III .COMPARATIVE PROFILES OF THE CONSUMER INNOVATOR AND THE LATER ADOPTER (contin. physical.g.) Characteristic Innovator Noninnovator (or later adopter) Less Less More Less Media habits Total magazine exposure More Special-interest magazines More Television Less Social characteristics social integration Social striving (e. social.14 ..M . and occupational mobility) Group memberships Demographic characteristics Age Income Education Occupational status More More More Younger More More More Less Less Older Less Less Less TE .

behavior.15 . Make the product at a complexity level not exceeding that of substitutes. to minimize the required adaption.M . Obtain third-party/professional/ objective endorsements. Price the product to "deliver" benefits quickly. Complexity TE . Make the product readily understandable. etc.III . Strive to make the product user friendly. Make the product/brand fit customer's social situation .MARKETING IMPLICATIONS OF IMPORTANT PRODUCT VENTURE CHARACTERISTICS Characteristic Marketing action Relative advantage Clearly and credibly communicate the product's advantage. Compatibility Develop an understanding of customer lifestyles. Make the product fit in with related products..

TE . etc.M .MARKETING IMPLICATIONS OF IMPORTANT PRODUCT VENTURE CHARACTERISTICS (contin.) Observability Encourage visible use by customers.) Characteristic Marketing action Testability Offer money-back guarantee (reduce the cost/risk of trial). Create incentives for customers to encourage friends to consider trial. Make it easy for others to perceive the product/brand.16 . Make small quantities free or at low price. Offer special incentives for durable items (test drives for autos. Provide incentives to encourage trial.III .

marketing and management capabilities Profile of Competitors • • • • • • Mission and business objectives Market position and sales trends Management capabilities and limitations Target market strategies Marketing objectives Marketing strategies and tactics TE .17 .Factors influencing the marketing strategy of key competitors Key competitor’s financial size and strength Key competitor’s objectives Key competitor’s marketing strategy Target market’s requirements Key competitor’s technical.III .M .

III .18 .M .MARKETING MIX VARIABLES Product Features Distribution Price Promotion Promotion blend Advertising Media Timing Personal selling Training Motivation Allocation Sales promotion Publicity Types of channels/ List price middlemen Quality Store/distributor location Credit terms Packaging Storage Branding Services Guarantees Assortment Discounts Transportation and Selection and logistics allowances Service levels Flexibility TE .

19 Other features Distribution convenience .III .M .CUSTOMER PERCEPTION HIERARCHY Customer product perception Benefits / satisfactions Tangible attributes Quality Style Packaging Branding Extended product Warranties Promotion Company image TE .

20 .NEW PRODUCT DEVELOPMENT PROCESS Business Strategy Idea generation Product/service development Idea screening and evaluation Product/service testing Business analysis Market entry TE .M .III .

ALTERNATIVE MARKETING CHANNELS Manufacturers / producers Agents / brokers Wholesalers /distributors Retailers Retailers Consumers and organizational end-users TE .21 .M .III .

22 .Channel design decisions and decision criteria Design stages Identification of channel alternatives Decision criteria Intensity of distribution Access to end-user Prevailing distribution practices Necessary activities and functions Evaluation and selection of channel(s) to be used Revenue-cost analysis Time horizon for development Control considerations Legal constraints Channel availability Selection of channel participants Market coverage Capability Intermediary’s needs Functions provided Availability TE .M .III .

PROMOTION MIX TOOLS Advertising Print ads Broadcast ads Billboard ads Packaging logos and information The promotion mix Personal selling In-person sales presentations Telemarketing Sales promotion Games.23 .III .M . contests Free samples Trade shows Couponing Trading stamps Price promotion Signs and displays Publicity Print media news stories Broadcast media news stories Annual reports Speeches by employees TE .

PROMOTION TOOL’S STRENGTHS AND WEAKNESSES Criteria Cost per Audience member Confined to target markets Deliver a Complicated message Interchange with audiences Credibility Sales Advertising promotion Publicity Low Poor to good Poor to good Low Very low Moderate Personal selling Very high Very good Very good Very good Moderate to high Good Poor Poor to good Low to moderate High None None Low Low TE .III .24 .M .

III .25 .M .ADVANTAGES AND DISADVANTAGES OF MAJOR ADVERTISING MEDIA Media Television Advantages Disadvantages Not easy to reach specific markets Total cost is high relative to other media Requires production specialists Short exposure time Must place ad well in advance of Publication Provide limited flexibility in gaining attention Provide incomplete control over location of ad in issue Only very limited message possible Cannot reach well-defined target markets Reaches large audiences Has visual and audio capabilities Provides great flexibility in getting attention Short lead time needed to place ad Magazines Reach of issues is high for demographic and geographic segments and High-quality production journals Ad lasts as long as magazines or journal is kept Issues are often read by more than one person Credibility of magazine or journal can benefit ad Outdoor Relatively inexpensive advertising Many repeat exposures TE .

III .ADVANTAGES AND DISADVANTAGES OF MAJOR ADVERTISING MEDIA (continued) Media Radio Advantages Disadvantages No visual capability Short exposure time Provides little flexibility in gaining attention Audio capability Low cost relative to costs of the other media Short lead time needed to place ad Can reach demographic and geographic segments Reaches large audiences Reaches audiences in cars News.M .g.Reach large audiences papers Can reach segments by locale Short lead time needed to place ad Credibility of newspaper can benefit ad Direct Provides great flexibility in reaching target market segments mail No clutter from competing ads Easy to personalize copy and layout TE .26 May be relatively expensive Provide little flexibility for use of creativity Limited reproduction quality (e. little or no use of color) Short life carries over to ad Easily thrown away as "junk mail" Obtaining appropriate mailing lists can be expensive ..

steam turbines) Major purchase decisions.M .III . such as food items purchased by supermarket chains Features and performance of the product requiring personal demonstration and trial by the customer (private aircraft) Channel system relatively short and direct to endusers channel intermediaries Personal selling needed in "pushing" product through channel Channel intermediaries available to perform personal selling function for supplier with limited resources and experience (brokers or manufacturer's agents) TE .CONDITIONS SUGGESTING PERSONAL SELLING AS A MAJOR ELEMENT OF THE MARKETING MIX Mix area Product or service Characteristics Complex products requiring customer application assistance (computers.27 Channels . pollution control systems.

M . real estate) Selling price or quantity purchased enable an adequate margin to support selling expenses (traditional department store compared to discount house) Advertising media do not provide effective link with market targets Information needed by buyer cannot be provided entirely through advertising and sales promotion (life insurance) Number and dispersion of customers will not enable acceptable advertising economies Advertising TE .28 .CONDITIONS SUGGESTING PERSONAL SELLING AS A MAJOR ELEMENT OF THE MARKETING MIX (continued). Mix area Price Characteristics Final price negotiated between buyer and seller (appliances.III . automobiles.