Marketing Midterm & Final

Hofstede's Cultural Frameworks (6)

1. Individualism vs. Collectivism

2. Femininity vs. Masculinity

3. Indulgence vs. Restraint

4. Longterm vs. Short-term Orientation

5. Uncertainty Avoidance

6. Power Balance

SOSTAC

1. Situational Analysis → where are we now?

2. Objectives → where do we want to go?

3. Strategy → how will we get there?

4. Tactics → how exactly will we get there?

5. Actions → who does what, when, how?

6. Control → are we on track?

What is the difference between Risk and Uncertainty?

Risk = measurable (outcome is not known with certainty, but probabilities are known or can be estimated.) You can calculate likelihood and manage it

Uncertainty = unmeasurable (outcomes and probabilities are unknown. Cannot be quantified with confidence)

Johari Window

Open area → Known Knowns = things we are aware of and understand

Blind area → Known to others but not the self = things we know we do not understand

Hidden area → Known to self but not known to others = things we overlook or take for granted, but data exists

Unknown Area → Unknown to self, Unknown to others = things we are unaware of and can't predict

What are the 3 Levels of Situational Analysis? Provide examples of each and determine which framework to use.

1. Macro (often invisible; Ex: trends, PESTEL framework, influence strategy and outcomes)

2. Meso = market (Porter's 5 Forces; suppliers, partners, competitors)

3. Micro = non-market (Hofstede’s; customer behavior, internal company factors)

How do market forces directly shape competitive landscape?

Industries with high levels of competition are seen as less attractive due to more pressure on profit margin

How are Porter's 5 forces limited?

It disregards partnerships, ecosystems, etc.

Describe the Cultural Iceberg

Observable: Behaviors + practices

Not Observable: Perceptions, attitudes, beliefs, values

Criteria for Objectives

Objectives must be SMART

1. Specific

2. Measurable

3. Achievable

4. Relevant

5. Timely

Ex: Increase organic website traffic from qualified leads by 20% within the next quarter

What is the difference between Strategic and Tactical Objectives?

Strategic = long-term (1-5 years), directional, big picture @ business or department level.

Tactical = short-term (quarter-quarter), operational, execution focused @ functional or team level.

What is the difference between KPIs and OKRs?

KPIs = continuous, backward looking. They monitor how well progress is happening on ongoing activities. Assessed on an on-going basis.

OKRs = How do we know we are making process? Forward looking, broad + across all teams. Assessed quarterly.

Ex: If the company were a car, the KPIs would be the dashboard that monitors how fast the car is going, and the OKRs would be the GPS telling the car (company) where to go and how to get there

What is the most important question customers are asking?

WIIFM? -> What's in it for me?

3 ways companies can achieve market leadership. Provide definitions, examples, and downsides for each

1. Operational Excellence = basic services, no frills. Ex: Costco, Zara. Ikea

- Downside: Low margins per sale, limited room for customization

2. Product Leadership = focused on the best product. Ex: Tesla, Apple, Dyson.

- Downside: High cost

3. Customer intimacy = Customer-driven. Ex: Nordstrom, Bentley

- Downside: High cost/customer

List ways you can Segment (STDP)

1. Geographic

2. Demographic

3. Psychological

4. Behavioral

STDP Model Steps

1. Identify a set of differentiating competitive advantages on which to build a position

2. Choose the right competitive advantages

3. Select an overall positioning strategy

Phase 1: Product Development

1. Investment

2. Sales have not begun

3. New product ideas are generated, operationalized, and tested

Phase 2: Launch

1. High costs

2. Slow sales

3. little or no competition

4. demand has to be created

5. customers have to be prompted to try the products

6. makes little money @ this stage

Phase 3: Growth

1. costs reduced

2. sales volume increases

3. profitability begins to rise

4. public awareness grows

5. competitons begins to increase w a few new players in establishing market

6. increased competition leads to price decreases

Phase 4: Maturity

1. costs are lower as production volume increases

2. sales volume peaks and market saturation is reached

3. new competitors enter the market

4. prices drop due to proliferation of competing products

5. differentiation/diversification emphasized to mainting/increase market share

6. profits decline

Phase 5: Decline

1. costs increase due to some loss of economies of scale

2. sales volume declines

3. prices and profitability diminish

What is the Value Proposition?

the set of benefits or values a product promises to deliver to consumers to satisfy their needs

Aspects of Market Research Analysis

shorten - risk mitigation

- market trend identification

- consumer behavior analysis

- strategic decision-making

- competitive analysis

- data analysis

- data collection + processing

Explain the four components of the Product Market Expansion Diagram

1. Market Penetration: Existing product in existing market (no changes, easiest)

2. Product Development: New product in existing market

3. Market Development: Existing product in new market

4. Diversification: New product in new market (hardest)

What are the levels of a Product?

1. Core product -> how it benefits the customer

2. Actual product -> tangible, physical product

3. Augmented product -> non-physical, added-value

Pros and Cons to Individual Brand Positioning

Pros:

1) Brands can be fully tailored to specific markets or segments: tone, message focus on relevant benefits.

2) Product failure = limited impact on corporate brand or other products

Cons:

1) High marketing costs

2) Fewer economies of scale in branding and advertising

3) Possible cannibalization between brands in the same portfolio

Pros and Cons for Umbrella Brand Positioning

Pros:

1) Strong parent brand equity carries over

2)Lower marketing cost

3) Faster market entry

4) Long-term trust and familiarity

Cons:

1) 1 failure damages the entire brand

2) One-size-fits-all positioning

Describe the Bullwhip Effect

small changes in consumer demand can lead to progressively larger fluctuations in orders as you move up the supply chain

4 Methods to Determine Price

1. Cost-based (direct + indirect + margin)

2. Value-based (what is the customer WTP?)

3. Competition-based (what are competitors' prices and how do we respond? Match? Undercut?)

4. Product based (synergy bw product lines)

If you are offering a service, what happens to the 4 Ps of marketing?

They increase to 7

1. Product

2. Place

3. Price

4. Promotion

5. Physical Environment

6. People

7. Process

What does Porter's Five Forces show?

If an industry is profitable, where competition comes from, where to compete (industry), and how to compete (strategy + positioning)

Traditional Marketing Funnel

1. Awareness - people become aware of a problem they want solve

2. Consideration - people start looking into products/services that can solve their problem

3. Conversion - prospects find a paying solution that they like and become paying customers

4. Loyalty - customers continue using the product/service AND recommend it to others

Value proposition statement

To (target segment and need) our (brand) is (concept) that is (point of difference)

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Ex: Apple

To users who want powerful, easy-to-use mobile technology, our iPhone is a premium smartphone that is unmatched in its performance and design

What is Laddering?

Theory that states customer purchase decisions have a hierarchy

1. Attributes and features (tangible, observable traits)

2. Consequences/Benefits (functional/emotional outcomes)

3. Values and goals (life aspirations driven by behavior like honesty, freedom)

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Ex: Hokas

1. Attributes + features = actual shoe; comfort, design, etc.

2. Benefits = keeps foot protected

3. Values + goals = personal health + fitness goals

What is brand equity and what are the results?

Brand equity = added value beyond functional benefits that is built through awareness, trust, and perceived value

Results = premium pricing, customer retention, market power

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Ex: Apple

Apple has strong brand equity so they’re are able to charge high prices, their customers have an Apple ecosystem, and they hold a lot of market power in the tech market

Tactics of marketing employ...

the 4 (or 7) P's of marketing

How can brands increase preference?

Increase familiarity. More exposure = more familiarity = more likely to buy

However, you must use the same message across all channels (if you advertise safety as your car's brand, you can't market it's speed or horse power later)

What is Nudging?

Nudging = SUBTLY encouraging people to take a certain action

Ways to Nudge?

1. Default options (ex: all cookies enabled)

2. Sense of urgency (ex: Sale wont last!)

3. Sense of scarcity (ex: only 3 left!)

4. Social proof (ex: most people choose this deal)

5. Anchoring (ex: bundle deal, customers also bought)

6. Reciprocity (ex: you do something for me I'll do something for you; if customers give websites their email, the customer gets 10% off or free shipping)

System 1 vs System 2 Thinking

System 1 = fast, autopilot, implicit; fight/flight

System 2 = slow, deliberate, strategic

Marketing and nudging wants to encourage system 1 thinking so that people don't have to think before they buy

System 1 Thinking Impact on Consumer Decisions

- people don't read carefully

- people don't evaluate rationally

- people are easier to cues and nudges

Types of Campaigns

1. Awareness

2. Media

3. Marketing

4. Push

5. Product Launch

6. Brand Launch

7. Rebranding

RASCI Matrix

Responsible: executes tasks + ensures their completion

Accountable: owns success of task + answers for its outcome

Supportive: provides resources + assistance to ensure successful completion

Consulted: offers expertise + insights to inform decision-making

Informed: stays updated on progress + outcome of task

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Ex: Website Design

• Develop a new home page → Web designer is RESPONSIBLE for that

• Project manager is ACCOUNTABLE for project success, making sure the new home page is finished

• Supportive

• Marketing team is CONSULTED to make sure the page is visually appealing and hits all the marks

• CEO is informed bc he doesnt need to do anything except check back in to see if it was done

How is the RASCI Matrix helpful?

- helps avoid double work

- avoids things falling through the cracks

- ensures everyone is on the same pg

- supports ownership

Campaign Steps

- Why = what are your goals/what do you want to achieve

- Who = target audience, what they care abt, and where you will find them

- What = what do you want to communicate?

- How = How will you reach your audience? How will you measure success?

- When = When will your campaign run + for how long?

What is remarketing?

a digital marketing strategy that targets ads to people who have already interacted with a brand's website or app but haven't completed a desired action

User visits website, leaves site, sees ads on other site for product, and visits site again

What is control?

Control = aims to link metrics and outcome

Control = measuring and monitoring performance against objectives we have set and using the data to learn and improve

Core question: are we achieving what we set out to do?

Marketing Funnel Category of KPIs

1. Awareness → reach, impression, brand recall

2. Consideration → CTR, time on page, engagement

3. Conversion → signups, sales, cost/lead

4. Loyalty → repeat purchases, churn

Advocacy = NPS, reviews, referrals

4 experiment families and how they work together and their SOSTAC phase

1. Perception -> what do customers value? (Situation)

2. Message -> what message works best? (strategy)

3. Behavior -> what makes customers act (Tactics/action)

4. Impact -> did it actually work? (control)

How to test perception

- blind testing

- packaging/design test

- perception mapping

How can we change our message?

- focus on language, visuial, tone, emotion

- figure out which message resonates with each segment

How to test our message

- A/B testing

- emotional vs rational appeal tests

- tone of voice experiments

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Ex: Capri-Twist

• A/B = “your childhood fav, all grown up” vs. “sweet with every sip”

• Emotional vs rational = nostalgic commercials vs data as #1 kid’s drink

• Lidl sarcastic slogan vs non-sarcastic slogan

A/B testing

A/B testing = a controlled experiment controlling 2 versions to see which performs better

- only 1 variable changes at a time

1. Start w clear hypothesis

2. test both versions w similar audiences

3. track a specific KPI

4. implement the winner

Behavior

what makes customers act?

• UX

• triggers/nudges

• price sensitivity testing

• offer/promotion testing

Impact

did it actually work? → focus on measuring outcomes

-pre/post campaign measurement to prove causality

- control group testing

Common Mistakes in all experiment families

1. too many testing elements at once

2. no statistical confidence (sample size too small or test stopped too early)

3. focus on wrong or vanity metrics

4. unclear hypothesis

5. ingored context

Customer Journey Map Planning

Awareness: PR, word of mouth, radio/TV

Consideration: Search, email, paid content

Purchase: Website, mobile app, site

Service: online chat, call center

Loyalty expansion: promotion, blog, newsletter

Blue Ocean Strategy

Creating a new market where competition isn’t yet established

Porter’s 5 Forces

Threat of New Entrants = How easy is it for others to enter the market?

Bargaining Power of Supplier = What leverage do they have: price, conditions, dependency?

Bargaining Power of Buyers = How much choice do they have? How sensitive to price?

Threat of Substitutes = Are there alternative products that satisfy the same need?

Rivalry Among Existing Competitors = How intense is the competition within the industry?

Trend #1- SAVE Model

1. Solution - position product as a solution to customer needs

2. Access - multi-channel presence for availability

3. Value - communicate the product’s value not just its price tag

4. Education - Provide relevant info to guide informed decision making @ each step in customer journey

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Ex: Uber

Solution = reliable, convenient transportation

Access = mobile app/ interface that allows someone to call an uber for you

Value = reliable, safe transportation; transparency, personalization

Education = real-time notifications (driver is here, etc.), on-boarding + in-app tutorials, safety reminders

Trend #2 - Flipped Funnel

1. Retention - keep customers happy after they buy

2. Activation - encourage repeat purchases

3. Community - creating customer network around brand

4. Advocacy - turning customers into brand promoters

Advantages to Flipped vs Traditional Funnel

1. Cheaper

2. more profitable

3. stronger brand reputation

Traditional Funnel Characteristics

main goal = expansion, acquire new customers ASAP

short sales cycle, quick conversions

best for new company, new product launch

Trend #3 - Donut Model

framework for sustainable development that aims to balance human needs with planetary boundaries

1. The inner ring = minimum conditions needed for everyone to live a dignified life. Based on 12 dimensions from the Sustainable Development Goals

2. The outer ring = the ecological limits of the planet (climate change, biodiversity loss, etc.)

3. Safe space between social foundation and ecological ceiling = where humans can thrive without depleting the planet

• marketing is not about selling more but abt creating long-term value for people and planet

• Customers trust and prefer brands that focus on sustainability and have a clear purpose

  • if not, market share is lost and reputation is damaged

Greenwashing

Making false/misleading sustainability claims

Trend #4 - The 3H model

3H Model = content strategy for digital platforms

1. High-impact campaigns (Hero) = big brand campaigns designed to increase brand awareness/buzz

   • Ex: Apple releases a new product

2. Regular engagement (Hub)= regularly scheduled content to improve engagement and UX

   • for some reason i think of good mythical morning

   • Ex: Apple releasing Apple Swiped videos to show how awesome their products are

3. Useful content (Hygiene) = “pull” content design for core audience, boosts content depth and site relevancy

   • Ex: apple releasing how-to’s/tutorials on their products ensures that Apple is found by consumers who are looking for solutions

Trend #5 - Experience Model

Goal = increase emotional connection, make customers part of the experience

Customers are WTP a premium, higher customer retention and NPS

4 Realms of Customer Participation and Connection

1. Entertainment

2. Educational

3. Aesthetic

4. Escapist

Passive vs Active participation

Passive = observational (ex: art museum)

Active = Integrated (ex: escape room)

Trend #6 - AI in marketing

AI in marketing = use of machine learning and automation to analyze data, predict trends, and personalize customer interactions

ex: content creation, customer segmentation, chatbots

Divergent vs. Convergent Thinking

Divergent = generating many ideas (brainstorming, storytelling, "moonshot ideas").

Convergent = narrowing those ideas down using logic and data (testing, analytics) to see "what works best".