Y2 - Principles of Marketing Semester 1 Key Terms

The Marketing Environment:

Marketing Environment: the actors and forces that effect management’s ability to build and maintain successful consumer relationships

• encompasses internal and external factors impacting marketing activities.

6 Components of the Marketing Microenvironment:

Company as part of Marketing Microenvironment: 

internal environment, HR hires correctly, finance concerned with budgeting, R&D innovates, operations and management

Suppliers and Intermediaries as part of Marketing Microenvironment:

• Suppliers and Intermediaries:

  • Suppliers: provide raw materials and resources needed to create value, and thus share problems like delays

  • Intermediaries: assist promotion and distribution of products

    • Example: Retailers (Tesco), Logistics firms (DHL)

Competitors as part of Marketing Environment:

• Competitors:

  • Marketers must gain strategic advantage by positioning offerings strongly.

  • Success = providing greater customer value than competitors

    • Example: Coca Cola and Pepsi, Apple and Samsung etc.

4 aspects of publics as part of Marketing Microenvironment:

• Publics:

  • Any group that has a level of interest or impact on an organisation’s ability to achieve its objectives

    • Gedia: TV, newspapers, social media

    • Government: laws and regulations

    • Citizen-action: environmental groups, consumer advocates

    • Local: neighbourhood residents and community

Customers as a part of Marketing Microenvironment:

• Customers:

  • To serve a target market and build profitable relationships

    • Consumer markets (individuals)

    • Business markets (organisations)

    • Government markets (public sector)

Costa’s suppliers, competitors and public: 

Costa

• Supplier:

  • Marks and Spencer’s

    • operate on a national scale supplying coffee to its stores

  • Coffee Nation

    • acquired by Costa in 2011 (now branded Costa Express)

    • Uses fresh ground coffee rather than powder

  • key commodities such as coffee and cocoa are sustainably sourced and third-party certified

• Competitors: Starbucks, Pret a Manager

• Publics:

  • Media - Costa Coffee has multiple social media accounts such as Facebook, Instagram and Youtube

  • Local - South Woodford residents, commuters, appealing to different age brackets

Marketing Macroenvironment: 

Consists of larger societal forces that affect the microenvironment and shape opportunities, as well as pose threats. PESTLE

Political factor of Marketing Macroenvironment:

• Political:

  • government reforms, political stability and impacts of policy

  • e.g. Brexit impacting trade flows, international relations

Economic factors of Marketing Macroenvironment:

• Economic: impacts demand and supply, unemployment, inflation

  • boom - increased demand (vice versa)

  • Changes in interest rates and exchange rates impact business operations

  • e.g. freezing interest rates, spikes in inflation, supply shocks, financial crashes

Social cultural factors of Marketing Macroenvironment:

• Socio-cultural forces:

  • forces that affect society values, perceptions and behaviours

  • changing demographics, increased demand for ethicality and responsible brands

  • growing interest in health, wellness and mindfulness

  • e.g. Strava, increased interest in gym, dieting, organisations

Technological factors of Marketing Macroenvironment:

• Technological forces:

  • creates new products and causes creative destruction

  • e.g. Netflix streaming, OpenAI, Sora, social media apps

Legal factors of Marketing Macroenvironment:

• lawsuits, copyright, patents, intangible goods and intellectual media

• e.g. Burger King and Mcdonalds accused of false advertising, Tiktok sound copyrights

Environmental factors of Marketing Macroenvironment:

• climate change, pollution, renewable resources, environmental degradation.

• e.g. degradation of oil supplies, rise in wind, solar and tide energy, investment in nuclear energy in £10s of billions

Proactive vs reactive responses to the marketing environment:

Proactive responses:

• taking action to shape environment, using strategy and innovation

  • e.g. fast food firms adapting during Covid to drive thru and delivery, superstores converting to delivery and digitalised shopping

Reactive responses:

• views environment as uncontrollable, waiting for change and then adapting

  • e.g. Kodak not adapting to technological changes, reacting too late and thus bankruptcy (2012), companies may have thought Covid would pass and any long-term structural changes would be costly

Continuous Scanning of the Marketing Environment:

• continuous monitoring of the marketing environment

• Tools: trend forecasting, market research, competitive intelligence

• Threats —> Opportunities.

Customer behaviour:

Helps markets to:

• Segment more effectively

• Customer targeting + messaging

• Brand positioning towards customers

• Develop Marketing Mix

Customer behaviour: the study of how individuals, groups and organisations select, buy, use and dispose of g&s, ideas or experiences to satisfy needs and wants (Kotler & Keller, 2018

Stimulus response mdoel and selling:

Stimulus-response model

• Inputs: Marketing (4P) and Environmental (PESTLE)

• Buyer’s mind: Characteristics and decision process

• Outputs: product, brand choice, purchase amount

Selling:

• Business —> Customers g. groceries, Netflix; emotionally driven

• Business —> Business g. computers, steel, resources; rational

Types of customers buying decisions (behaviour) :

Type of behaviour	Involvement	Brand Differences	Examples
Complex	High	High	cars
Dissonance-reducing	High	Low	carpets
Habitual buying	Low	Low	salt
Variety seeking	Low	High	biscuits

5 stages of customer decision making process (name + def + example)

• Problem recognition:

  • Buyer recognises need / problem

  • Triggered by

    • internal stimuli g. hunger

    • external stimuli g. adverts or social media

    • marketer’s role

• Information search:

  • Buyer seeks information about solution, depending on involvement level

    • g. public sources, personal sources, commercial sources

• Alternative Evaluation:

  • Evaluate choices of brand based on criteria

  • Marketer’s role: ensuring excellence in certain criteria

  • Purchase decision:

    • Formal purchase + choice

    • Disrupted by attitude of others + unexpected situations

  • Post-purchase behaviour:

    • Level of satisfaction

    • Cognitive dissonance

    • Marketing implications: customer service, reviews and expectations

Cultural influences on consumer behaviour:

• Cultural

  • Power distance index: measures acceptance of unequal power distribution in society

    • Advertising in high ; community creation in low

  • Individualism vs Collectivism

    • Customer sneakers vs shared experiences

    • USA – just do it Nike vs Japan – family dining

  • Masculinity vs femininity

    • Masculine – performance; feminine – emotional appeals

    • Ambition via luxury car ads vs work-life balance campaigns

  • Uncertainty Avoidance Index: measures ambiguity risk

    • High – structure, low – flexibility / innovation

    • Nigeria money back offers vs Singapore tech ads

  • LT vs St orientation

    • China – promoting savings vs USA – instant gratification

  • Indulgence vs Restraint

    • Mexico – vibrant fun ads vs Russia - disciplined messaging

Social influences on consumer behaviour:

• Reference groups and opinion leaders

  • Membership groups, aspirational groups, dissociative groups

• Family, life cycle and changing roles and status

Personal and Psychological influences on consumer behaviour:

• Personal:

  • Age and life cycle, occupation and economics

  • Lifestyle, frameworks, personality

• Psychological:

  • Motivation (Maslow’s hierarchy), perception, beliefs and attitudes

Maslow’s hierarchy of needs:

Examples:

• 5 - University degree

• 4 – luxury watch or premium car brand

• 3 – social media platform

• 2 – insurance, banking services

• 1 – necessities

Tech and value driven shifts of consumer behaviour:

What’s next? Technology-driven shifts:

• hyper-personalisation:

  • recommendation engines, Open AI

• Experience economy:

  • Shift from buying “things” to “memorable experiences”

  • Transformations, not just products g. Secret cinema

Value-driven shifts:

• Sustainability and ethical consumption:

  • Transparency, sustainability

• Subscription economy:

  • Ownership à access; growing beyond media into physical goodsg. clothing rentals

• Health and wellbeing:

  • Physical and mental health, clean eating and wellness retreats

Digital marketing:

• Actively promoting products and services using digital distribution channels as an alternative to traditional mediums

  • e.g. the internet, mobile apps, display advertising

Objectives of digital marketing:

• Objectives:

  • reach and engage with audience

  • motivate audience action

  • maximise investment returns

Types of digital marketing (4): 

• Social media marketing 

• Search marketing 

• Email marketing 

• Display ads 

Social media marketing and evaluation: 

• Utilising social networking sites as a marketing tool

• Goal: product shareable content to help companies increase brand exposure and widen customer reach

• Advantages:

  • Increased brand awareness, higher conversion rates, brand loyalty and authority

• Disadvantages:

  • Negative feedback, time intensive, negative publicity

Search Marketing and evaluation + PPC:

• Goal: visibility when customers seek solutions

• Search Engine Optimisation (SEO):

  • Optimising website and content to rank higher in organic search results, long-term

• Pay-per-click:

  • Digital marketing model in which advertisers pay publishers every time an ad link is clicked on,

    • The publisher can pays to place ads at top of search results, increasing L-T PPC and revenue.

    • e.g. Google Ads, Facebook Ads ; immediate but costly

  • Advantages:

    • fast results, demographic targeting, provides detailed data and allows for effective adjustment

  • Disadvantages:

    • costly, time-consuming, requires monitoring and optimisation, expertise requirement

Email Marketing and evaluation:

Email Marketing:

• Sending emails to current and potential customers to increase brand awareness, driving engagement and sales

• Successful, cost-effective and simple way to reach customers

  • e.g. welcome, newsletter, promotional, survey, retention

  • e.g. uber offers, Netflix promotional

• Advantages:

  • brand awareness, generates web traffic, customer engagement, drive sales

• Disadvantages:

  • spam / intrusive, time-consuming for results, technical issues

Display ads, types and evaluation:

Display Ads:

• Ads placed on websites, networks or apps, typically image, text or video banner that relocate a user to a website or landing page

• Placed mainly in corners or designated areas on webpages and platforms, showcased in the form of a banner

Types of Display Ads:

• Banner:

  • Image-based rectangles or squares that link out to a website

• Interstitial:

  • Full-screen ads that overlay screen e.g. text, video or input req.

• Rich media:

  • Video, audio or interactive elements e.g. LEAPOMOTOR video above

• Advantages:

  • building brand awareness, driving traffic, widespread deployment, measurable

• Disadvantages:

  • Low conversion rates, intrusive, not in control of reputation

  • (think of Wreck it Ralph: Breaks the Internet with dodgy sites, display ads and search engines)

Digital Analytics:

Digital Analytics:

• Analysing digital data from various sources to indicate user behaviour

• Collecting and analysing quantitative and qualitative data, enhancing business operations to improve online experience

• Tools: visitor numbers, popularity, duration, sales, referrals, Google Analytics

Reach Strategy of Digital Marketing: 

Strategy	Objective	Goal	Key Channels	Key Performance Indicators
Reach	Build awareness of your owned media properties	Drive traffic from external sites	SEO, PPC, Social Media	Impressions, Click-through rate, visitors

Act Strategy of Digital Marketing: 

Strategy	Objective	Goal	Key Channels	Key Performance Indicators
Act	Persuade visitors to interact with your brand; lead generation	Encourage interaction and capture leads	content videos ,blogs, landing pages	Lead generation, downloads, duration

Convert Strategy of Digital Marketing: 

Strategy	Objective	Goal	Key Channels	Key Performance Indicators
Convert	Convert leads into paying customers	Achieve sales	Follow ups, checkouts, retargeting ads	Sales, conversion rate, Average Order Value (£)

Engage Strategy of Digital Marketing: 

Strategy	Objective	Goal	Key Channels	Key Performance Indicators
Engage	Build LT relationship and turn customers into advocates	Build customer loyalty and advocacy	Email marketing, excellent customer service, communities online	Customer Lifetime Values, Social media discussion, positive reviews, Repeat Purchase Rate

What does the RACE strategy stand for?

Reach-Act-Convert-Engage Strategy

Ethical issues of Digital Marketing:

Ethical issues:

• False advertising / Misleading information

• Misuse of general and customer data

• Advertising on Unethical sites

• Manipulating search engine results

• Persistent intrusiveness

Classification of key channels in terms of media types (OPE):

Classification of Key Channels:

Owned media:

• Channels fully controlled, created and managed by the brand

• company websites, profiles, email lists, apps

Paid Media:

• Channels where a brand pays to promote content or reach an audience

• PPC, Social media ads, display ads, influencer partnerships

Earned media:

• Exposure gained through 3-P actions, not paid or controlled directly by the brand

• Social media shares, press coverage, user generated content, organic search rankings from SEO

Marketing Communication:

Marketing Communication: How firms attempt to inform, persuade and remind consumers, directly or indirectly, about the product and brands they sell

• voice of the brand —> establish dialogue and relationships

Integrated Marketing Communication Mix:

Integrated Marketing Communication Mix: Events, Advertising, Public relation, Digital, Direct, Sponsorship

• Tools: advertising, selling, PR, sales promotion, direct marketing

Definition of advertising: 

Any paid form of non-personal presentation or promotion of ideas, G&S by an identified sponsor

The role of advertising (AIARCEE):

• Awareness

• Information

• Attitude

• Reminder

• Countering the competition

• Expansion

• Education

Explanation of each role of advertising (AIARCEE):

• Awareness:

  • Awareness of brand, product, service, attracting target audience

  • A precondition to purchase and recall, ensuring knowledge and value

• Information:

  • Informs the target audience, linking to awareness, highlights uses and features etc.

  • Essential for modification and customer purchasing decisions

• Attitude:

  • Expected to create a favourable attitude towards brands, promotion is required

  • Increases sales and corrects negative attitude

• Reminder:

  • A reminder objective is necessary if attitudes are positive

  • Repeated sales, highlights brand presence and outplays competition

• Countering the Competition:

  • Creative advertising —> Superiority

  • Aggressive sales promotion

• Expansion:

  • Caused by successful ads; local —> regional —> national —> international

  • Various techniques of promotion such as advertising

• Education:

  • Some adverts educate product use, handling operations and brand advocacy

AIDA Advertising Model (a conversion theory): 

AIDA Model (a conversion theory)

Cognitive stages a consumer passes through during their purchasing process, serving as a template for marketers to transition consumers from awareness to final action.

• Attention - consumer becomes aware of your product via advertising

• Interest - interest in benefits, attachment and uses

• Desire - Favourable disposition is developed towards the product

• Action - Consumer forms a purchase intention

Criticisms of the AIDA Model:

• Little evidence of desire before action e.g. unsuccessful trials or competition arising

• Focuses on converting non-buyers to buyers and neglects buyers who needed to be constantly persuaded

ATR Advertising Model:

ATR Model

Outlines stages a consumer goes through when encountering and adopting a new product or service; asserts the role of advertising to reinforce habitual behaviour

• Attention - raise customer awareness of product or service presence

• Trial - encourage testing among consumers

• Reinforcement - Reinforce positive experience, build loyalty and encourage repeat purchases

Criticisms of the ATR Model: 

• Ignores complex factor e.g. multiple trials or exogenous influences

• Customer loyalty is a long-term factor, extending beyond the reinforcement stage

Pre-requisites of advertising

• Target audience

• Message decisions

• Media selection

Key Media Decisions of Advertising:

Key Media Decisions

• Reach: exposure level during a certain time period

• Frequency: how often will an individual in the TA be exposed

• Impact: qualitative value through a given medium

  • An ad in vogue > has a greater impact for a fashion brand > ad in local paper

Types of line advertising (3): 

• Above-the-line 

• Below-the-line 

• Through-the-line

Above-the-line advertising:

• Above-the-line: mass marketing methods that are mostly untargeted and aimed at brand establishment

  • everyone has access to the media receives the message and conversion rates and weakly weighted

Types of Above-the-line Advertising:

• Television Advertising: traditionally most expensive, but creative and attention grabbing ; widespread

• Radio advertising:

  • Live reads spoken by an on-air personality

  • Sponsorships of segments by businesses

  • Produce spots incorporating dialogue, music or effects

• Print Advertising: any written form of communication used to inform, persuade or remind consumers of G&S

• Outdoor advertising: billboards, visibility and 24-hour advertising

Below-the-line advertising:

Conversion rate focused, referring to specialised and direct promotion targeting a certain audience group

Direct messaging methods as part of Below-the-line advertising:

• Sponsorship which is unconventional but non-media communication

• Brand Activation Campaigns involving activities and creativity with audiences to create memorability e.g. Share a Coke or Have a —-, have a KitKat

• In-store promotions - visual merch, pop ups, samples or displays

Through-the-line advertising:

• Through-the-line: 360 degree advertising of ATL and BTL, aiming to enhance brand-building and increase conversion rates

  • 360 marketing campaign: Targeted messaging across contact point, spanning all aspects of the brand’s marketing mix, intended to apply brand strategy

Ethical issues of advertising:

• Advertising to children, teenagers and vulnerable people which may cause harm or unethical consequences e.g. rise in antisocial behaviour

• Misleading advertising which leads to unsupported or incorrect purchases; different pricing levels on billboards compared to websites etc.

• Advertising and its influence on societal values

• Offensive or stereotypical adverts such as racist stereotypes

• Constant exposure may damage privacy or deter customers from a purchase

Brand definition:

Brand: A name, term, design, symbol or any feature that identifies one seller’s G or S as distinct from those of other sellers (AMA) ; intangible appearance

• not just physical features but also feelings towards a company or product

• Brand: built in the consumer mind, emotional connection, unique, abstract, irreplicable

"Your brand is what other people say about you when you're not in the room.” - Jeff Bezos

Product definition:

Product: An item which is ready for sale in the market

• tangible features, replicable and factory produced

6/7 types of brands:

• Product - e.g. Apple

• Service - e.g. BA / Barclays

• Place - London Eye

• Person - Cristiano Ronaldo, Lewis Hamilton

• Idea - save the planet, Nike Just Do It

• Organisation / Institution - Loughborough University, NHS

Branding definition:

Branding: The process by which companies differentiate or distinguish their product offering from the competition (Baines and Fill, 2014)

• Creating a valuable image of a product

• Branding adds value to base value

• Symbolises luxury and social status —> spending habits

Impact on Consumers - simplifies choice, reduces risk and increased self-expression

Impact on Firm - price premium, customer loyalty, power and leverage, financial asset

Brand equity definition:

Brand equity: A term that represents the value of a company’s brand based on recognition

• Recognition / willing to pay more = more brand equity —> direct impact on sales volume

  • Consumers gravitate to products with reputation

• e.g. Apple, premium price consumers are willing to pay for an iPhone, built on innovation, creativity and design

• Model: Identity + Meaning + Response + Relationships (Keller, 2013)

Negative brand equity:

• Volkswagen - recalled 11M diesel cards due to flawed emissions tests —> ~£10bn losses

How to build a brand:

• Brand Elements

• Brand Positioning

• Brand Personality

Brand Elements (Identity):

Brand Elements (Identity)

Likeable, memorable and meaningful

• Name e.g. Google

• Logo e.g. Nike Swoosh

• Colour e.g. Cadbury Purple

• Slogan e.g. “Just Do It”

• Jingle e.g. McDonald’s “ba-da-ba-ba-ba”

• Character e.g. Aleksandr the Meerkat

Brand Positioning: 

Act of designing your brand’s image to occupy a clear and desirable place in the mind of target consumers

Brand Personality and characteristics:

Brand Personality

• If the brand walked into the room, what would they be like?

• Key way to differentiate brands

• Characteristics:

  • sincerity - caring and honest e.g. Dove

  • excitement - daring and imaginative e.g. Red Bull

  • competence - reliable and efficient e.g. Amazon

  • sophistication - charming and classy e.g. Rolex

Key issues of Branding:

• How do we measure brand equity

• How do we position the brand effectively?

• The role of AI in modern branding

• Geographic and cultural boundaries

• Ethical issues of branding

• “Anxiety”

Segmentation: 

Segmentation: Dividing a large, heterogeneous market into smaller, more homogenous groups

• Segments have similar needs, characteristics and behaviours who are likely to respond similarly to a given marketing strategy

• Allows for target selection, opportunities, differentiation and tailoring mix.

Criteria and bases of Segmentation:

• Criteria: measurable, accessible, substantial, actionable

• Bases: demographic, geographic, psychographic, behavioural

Case study: Nike and Gender segmentation

• historically male oriented —> actively pursuing women’s segment

• Designing sports bras, footwear and apparel for women

• Campaigns focus on female empowerment and diverse pursuits

Targeting definition and steps:

Definition: Process of evaluating the various market segments of a company has identified and selecting which ones to focus on

• Choose segments that offer highest potential for growth, profitability and alignment with the company’s objectives

Steps: Size and growth potential —> Profitability —> Accessibility —> Alignment with company resources / goals

4 Targeting Marketing Strategies:

Undifferentiated (Mass) Marketing

Differentiated (Segmented) Marketing

Concentrated (Niche) Marketing

Micromarketing (Individual):

Undifferentiated (Mass) Marketing: 

• Concept: one product, one message

• Best for: commodities

• Risk: rise of segmented markets reduces effectiveness

• Example: popular fast food chains, e.g. KFC, Coca-Cola too

Differentiated (Segmented) Marketing

• Concept: Targeting several segments, designing separate offers for each

• Advantage: Higher total market coverage, reduced risk, diversification

• Challenge: High cost e.g. production, R&D

• Example: Toyota Corolla, Prius and Land Crusiers, varying in budget, reliability and efficiency

Concentrated (Niche) Marketing

• Concept: Focusing on single niches to achieve large shares in a small pond

• Advantage: Specialisation, strong brand authority

• Challenge: high-risk, dependence

• Example: Rolls-Royce, targeting ultra high net-worth.

Micromarketing (Individual):

Micromarketing (Individual):

• Concept: Tailoring products and programs to specific locations or individuals

• e.g. Nike By You (customing shoes)

Positioning Strategies (5):

Strategies:

• Attribute positioning:

  • based on specific product feature

  • e.g. Dyson’s bagless, high-suction technology

• Benefit positioning:

  • based on value the customer receives

  • e.g. Uber’s position on speed and convenience

• Application positioning:

  • Associating the product with a specific usage

  • e.g. Red bull position —> drink for energy and performance needs

• Competitor positioning:

  • positioning directly against a competitor

  • e.g. Avis vs Hertz: “We’re not #1, so we try harder”

• Price / Quality Positioning:

  • More for more: premium ; same for less —> Value proposition

  • Chanel —> Walmart

The S-T-P Model of Marketing:

The S-T-P Model

• Divide: GDPB factors determine sectors

• Choose: Measurable, Accessible, Substantial, Actionable segments

• Define: Create a strong, unique position in consumer’s mind, guided by positioning

Sustainable Marketing:

Sustainable Marketing: Socially and environmentally responsible marketing that meeds the present needs of consumers and business whilst preserving the ability of future generations to meet their needs - Kotler and Armstrong

Sustainability of Marketing on the Macroenvironment:

• Social: Increased consumer awareness, social justice movement

• Environmental: Climate change, resource scarcity, pollution

• Legal: new regulations, taxes, ESG

key drivers of sustainable marketing: 

• Conscious consumers, seeking brands that algin with their SEEP values

• Triple Bottom Line: bearable, equitable and viable between people, profit and planet

Triple Bottom Line: bearable, equitable and viable between people, profit and planet

• People: Social responsibility and impact on key stakeholders / employees

  • fe.g. air labour practices, safe work environment, well-being

• Planet: ecological footprint, sustainability of companies

  • e.g. reducing GGE, waste, resource conservation, renewable and ethical

• Profit: broader economic impact a business has on society

  • e.g. job creation, tax payments, innovation, LT economic viability / prosperity

Corporate Social Responsibility

Primary framework for how organisations manage their responsibilities, with profits and impacts on society, integrating social and ethical concerns into operations and interactions

Carroll’s Pyramid of Corporate Social Responsibility: 

• Level 1: Economic Responsibilities - Be profitable

  • primary responsibility of profitability, providing rewards to owners, fair payment and fair pricing to consumers

• Level 2: Legal Responsibilities - Obey the law

  • Society requires businesses to follow the laws e.g. employment law, product safety

• Level 3: Ethical Responsibilities - be ethical

  • What is fair, just and right e.g. liveable minimum wage to overseas workers

• Level 4: Philanthropic Responsibilities - be a good corporate citizen

  • Actively contributing resources to the community to improve QoL e.g. donations, volunteering

A company is not truly responsible if it is philanthropic but unethical and illegal

Creating shared value definition: 

Creating Shared Value: Addressing societal needs and challenges through the business itself via a business model

Approaches to transition from Corporate Social Responsibility to Creating Shared Value:

• Green Marketing

• Ethical Marketing

• Circular Economy

• Cause-related Marketing

Approach to Sustainable CSV: Green Marketing

• Marketing products and services based on environmental benefits, not just green promotion and must integrate the marketing mix.

  • 4Ps:

    • Product: design, less packaging, recycled materials e.g. Ecover

    • Place: sustainable distribution: shorter supply chains, CN shipping

    • Price: premium, reflecting higher costs or higher perceived value e.g. Organic food

    • Promotion: communicating eco-benefits transparently

    • e.g. Patagonia, sustainable mission, gold standard of authentic green marketing,

      • “We’re in the business to save our home planet”, 1% for the planet

Approach to Sustainable CSV:  Ethical Marketing

• Application of moral standards and principles to marketing decisions and behaviour

  • Without —> leads to simple tactics or greenwashing

• Principles: transparency and substantiated, fairness and reduce exploitation, respect for privacy and data, consumer well being

• Conflict between economic and ethical responsibilities:

  • Profit vs Principle Dilemma

  • Economic responsibility of Profit (Carroll’s Pyramid

  • Ethical Responsibility (Principle)

  • Short vs Long term sacrifices

Approach to Sustainable CSV: Circular Marketing

Challenge traditional economic model by recovering maximum value from resources, practicing repairing, repurposing and recycling existing products and materials

Approach to Sustainable CSV: Cause-related Marketing

• Approach 4: Cause-Related Marketing

  • linking a product to a donation of cause, collaboration profit and non-profit organisations to promote non-profit cause for common benefit e.g. Pampers and UNICEF: 1 pack = 1 vaccine

    • Benefits: differentiates the brand and builds emotional connection

    • Can be seen as exploitative, customer cynicism

Greenwashing definition and example: 

Deceptively promoting an organisation products, policies or aims as environmentally friendly when they are not, aimed to mislead consumers

• Vague claims e.g. “all-natural”

• Hidden trade offs: eco-friendly product made in polluting factories

• Irrelevant claims: CFC-free (banned for decades)

Violates ethical and legal responsibility, erodes consumer trust and harms authentic brands

Example: Volkswagen (2015 “Dieselgate”)

• VW marketed its diesel cars as “clean diesel” and environmentally friendly.

• Cars were fitted with software that cheated emissions test, making pollution levels appear far lower than they actually were.

Product:

Product: Anything that can be offered to a market for attention, use or consumption that might satisfy a want or need (Kotler and Armstrong)

Levels of Product with examples:

Level of product:

• Core Customer Value: fundamental benefit or problem solved

• Actual Product: tangible features, design and brand name

• Augmented Product: additional services and benefits

• Ford Example: CCV: transportation; AP = Ford Focus Car; AP = warranty, financing

• Smartphone example: CCV: connection, info and entertainment; AP: handset, brand, camera; AP: warranty, storage, support, App Store ecosystem

4 characteristics of services (VIIP): 

Characteristics of Services:

• Intangibility: Services cannot be touched or owned, distinguished from tangible products

• Inseparability: services are produced and consumed simultaneously, linked to their provides

• Variability: service quality can change based on provider and situation

• Perishability: Once performed, services cannot be repeated

4 stages of Product Life Cycle (IGMD):

• Introduction:

  • Slow sales, high costs (R&D, Marketing)

  • Building awareness, low penetration or high skim pricing, innovation. establish quality

• Growth:

  • rapid acceptance, rising profits, competition

  • quality and pricing maintenance, increased demand, new channels,

• Maturity:

  • Sales peak, market is saturated, optimal position, defending market share

  • Product enhancement and differentiation, lower pricing due to competition, intensive distribution

• Decline:

  • Sales and profits fall caused by tech shifts and changing tastes

  • Options: maintain quality with potential additions, reduce costs or discontinue product

Usefulness of the PLC:

Usefulness

• Diagnostic > predictive

• Could assist with product planning and management

• Strategies for PPPP must evolve overtime

• Escape via Innovation

Innovation definition:

Innovation: Turning an invention into a commercial success that creates value

Invention: MP3 file —> Innovation: Monzo / Revolut: innovated the banking model with app-first, fee-free experience