Marketing test 1

What is marketing

Marketing is the process of promoting, selling, and distributing a product or service to meet customer needs and drive business growth. It involves research, strategy, and communication to connect with target audiences.

Main principle of Marketing Myopia

Define & anchor your business around CUSTOMERS NEEDS, not on the basis of your product

Important note abt product longevity

Product superiority is NOT a guarantee of long term success

features of Modern marketing

• Refocus → customer needs determining what is made

• Marketing now the startegic driver ; not just part of strategy

• reallocation + restructuring of power - not main focus on the product itself , factory moves towards end of chain - less focus on tech advancement as a means to meet needs

Concepts of product marketing

1. Production concept - focus on making things cheap ; if my things r cheap + accesible, ppl will buy

2. Product concept - focus on continous product improvement for success - assumption that ppl care about product quality,value,performance & featerus , !!DANGEROUS!! - product superiority thing

3. Selling concept - Aggresive selling - well still be able to sell a shitty product if we have good salespeople pushing sales( Drawback : not likely to build loyalty. Focus on transactions )

4. Marketing concept - focus on needs/wants of traget market , then delivers value - customer & competitor oriented

5. Societal marketing concept - thinking about the long term good of society as a whole (difficult)

The selling concept → Marketing concept post Levitt

Inside out (making product THEN finding willing buyers) vs outside-in (opposite):

• Selling concept : starts @ factory → focus on existing products → thru selling & promo → ends w profit achieved by sales volume

• Marketing concept: Market→ Consumer needs focus → thru intergrated marketing → ends w profit thru consumer satisfaction

Biggest reasons for business failure

1. No market need

2. Not enough cash

3. Wrong people on the team

4. Competition

5. Prices and costs

Netflix case study

• Blockbuster video v succesful in 2004- worth 8 billion - even on stock exchange

• bankrupt in 2010

• Why is flopped : Late fees , Later tried streaming & kiosk but it was too late , Enron (their partner) also tanked

Netflix:

• started in 1999 as mail order subsription service

• offred to Blockbuster for $50 mil , said no

• Now worth $42 bill

• Streaming transition labelled a “dumb marketing decision” - had forgone 75% market value

• Started making OWN CONTENT - defined by need they fufilled , not service they offered

The overall marketing startegy

1. ID & satisfy NEEDS

2. Which will turn into → consumers choosing to buy

Maslows hierarchy

Once tier x need is met ; you move up. NOT TRUE brokies want LV just as much

Value

• Value = Benefit - Cost

• Value is determined by the utility combo of price + non- price benefits offered

Marketing defined

Its providing value to consumers & capturing value from consumers

• About exchange : The provision/transfer of G & S or ideas in return for smth of value

Beware of extremsit views / predictions

• VR , NFTs ( those art thingies)

The Marketing framework

1. Diagnosis → identify the problem to solve /opportunity - CONSUMER WANTS + NEEDS , COMPETITOR ANALYSIS (who)

2. Strategy → make a plan of action based on the diagnosed problem, defining how to achieve objectives (how to win)

3. Tactics → execute the plan through specific actions & campaigns ie - Where to sell,product attributes,price

4. Feedback loop (which goes right back to 1) → look at results and adapt strategies based on performance data.

Share of wallet

how much of a customers total spending a business captures in the product/services it offers (ie- how much unilever is in our pantries)

Category trade-offs

category = grp of similar products (hair care,snacks,skincare etc)

Categories of competitors important see slide 9 L5

1. direct - pronutro vs futurelife

2. Indirect - eggs (humpty dumpty) - other breakfast brands →Category separation :trade off competitors(buying jeans instead)

3. Substitutes - Mcdonalds (not in same bizz category but DO MEET NEED)

4. Geographic separation → (distant)competitors overseas

5. Timing separation → Potential competitors (who might enter the market after trends shift)

Porter 5 forces - slide 10

RIVALRY AMONGST EXISTING COMPETITORS (main one) also impacted by:

• Threat of new entrants

• bargaining power of buyers & suppliers

• threat of substitutes

Share of voice

measure of your advertisng presence/strength vs ur competitors (how much is our brand/product talked abt compared to ocmpetitors?)

key to succesful marketing

Understanding & mastering the environment your business operates in.

Benefit: having an expansive view of whats going on around you = strong diagnosis formed

Micro vs Macro environment

1. internal environment (your company)

2. Micro environment : Suppliers, competitors, consumers

3. Macro : Economy at large, Tech enviro , Financial enviro

purpose of market research

helps marketing mangers/other business ppl make decisions w the relevant and reliable info obtained

provides intelligence

elements market research aims to satisfy

1. Find opportunities

2. Create superior value

3. Solve problems

Sources of Marketing info

Internal data :

• databases of the firms activity

• Drawbacks: Hard to analyse , goes out-of-date quickly , data management and mining expensive & complex

Marketing intelligence

• public info about marketplace

• looks @ consumer behaviour (changing preferences) & competitors actions

Marketing research

• specifc + gives key insights public data doesnt

• collection process can be outsourced (research firm)

• drawback: expensive

an Insight

deep, actionable understanding of a target market/customer from data analysis + research that solves a previously unanswered question

benefit : useful to drive effective marketing strategies + make decisions

sources: surveys,social media,reviews

Market

Actual + potential buyers of a product/service

types of segments (why we do it- identify target market)

1. Geographic - country , province , neighbourhood etc

2. Demographic - Age,Gender,Income,Religion

3. Psychographic - Lifestyle, Personalities (ie Social vs Indulgent drinkers) , Social class

4. Behavioural - complex - Occasion (home drinkers vs going-out drinkers) , Types of users - first time, potential,repeat ,ex, non-users, usage rate , loyalty status

combination segmentation

combines diff segments

Features our segments must have

1. Measurable

2. accesible

3. substantial (cant be to niche ;must be significant enough)

4. differentiable

5. actionable - clear ways to target this segment

LSM- living standards measure

• south african - dividing whole country up into segments

• based on living standards in terms of asset ownership

• 10 categories (from less valuable to more value assets/what type of assets you had (satelite dish or no? etc)

critique:

• aim was to overcome race as a segmentation determinant in SA

• BUT poor got assets (free houses and assets bought from grants) so would jump LSM levels even though their disposable income didnt grow

• generic - doesnt consider product category

Strategy

After we diagnose and segment , we decide on our target market (set of uyers w shared common needs/characteristics the firm decides to serve)

targeting strategies

determined by:

• resources

• product/market variability

• product life cycle

• competitors

targeting startegies cont

• Niche - small specialised subgrp of a whole market

• Mass market - sale of undifferentiated , standardized product sold to a whole market in the same way

• Segmented- targets a defined segments of a big market ie Cocopops → for kids

• Micro marketing - small market thats hard to define/differentiate - cable car on Table mountain

Positioning

• unique position your bizz/product/comp holds in the consumer’s mind (volvo vs bmw - both selling cars(same target market) but v big on safety , bmw more bougie)

understanding positioning SEE BIG SLIDE

not neccessarilly abt product attributes BUT what we associate w the brand

• “the positioning decision provides the co w strategic direction for any future marketing activities” - theodore leaveitt

• positioning refelcted in slogans

Bases of Positioning

1. By Product attribute

2. Price/quality

3. Use/Application - like head & shoulders for dandruff

4. By product user - associating the product w a person - loubitouin SoKate heels

5. By competitor - implicit/explicit reference to known competitor

important note about positioning

• its ONLY based on perception

• good positioning is short n sweet - clearer more direct message

Positioning statement

statement summarising firm/brand positioning

• provides focus

• Identifictaion of comeptitive advantage

• differentiates product

• is a Value proposition

Repositioning

adjusting perceptions abt you or your competitors

Marketing trinity

1. segemntation

2. targeting

3. product positioning

strategy nexus

how the corporate and marketing strategy work tg

Ansoff matrix

Boston matrix

Blue ocean & red ocean strategy

blue → 1 company dominates alone in a new market (focus on diferentiating,lowcost,making n capturing new demand)

red→ Many cos compete in the same market (exploit existing demand,compete for market share - differentiation OR low cost)

objectives

• specific+ measurable things a business wants to achieve

• based on diagnosis

effective startegising

• must skillfully choose what NOT to do

brand

unique , recgocnizable feature of a good/service that differentiates it from competitors .

Name, design, symbol , slogan

how do consumers benefit from branding

• simplify choice

• reduce search costs

• competiton for differentiation encourages innovation

importance of branding

• marketing influence

• shape consumer perceptions

• financial value → loyalty, trust

what brands tell us

• quality

• attributes

• benefits - red bull gives you”wings”

• values

• personality : done using adj describing product qualities, subjective - increase trust/confidence

brand equity

the value a brand adds to a product, based on recognition, loyalty, and perceived quality.

• the psoitive differential effect knwing a brand name has on customer response

measures of brand equity

often harder to measure

• loyalty → hard to measure cuz its a attitude OR a behaviour (what you like n what you are loyal to different)

• perceived quality compared to others

• brand awareness - quantify it

• market behaviour

why its hard to value startups

• based on potential

how to build a brand

1. Brand development - product line extension, Brand extension (virgin active, virgin mobile)

2. Brand positioning

3. Brand name

4. Brand sponsorship

drawbacks n bennies of brand extention

• halo and horns effect

multi branding

tiger brands → the holding name/company → individual brands ; jelly tots , jungle oats

brand development

advantage:

• awareness already established

• economies of scale

• access to retail space

disadvantages:

• lack of focus

• stretch brand too far

• 1 fuck up affects all

choosing a Brand name

• suggest product benefits

• simple

• distinctive

• easy to translate

• can be registered & legally protected

types of brands

1. Manufacturer brand - producer brand : kellogs

2. Private brand -distributors - usually reatilers - woolworths brand stuff

3. Liscensing - a brand sells liscence to use their intellectual property - marvel merch

4. Co-branding - the simba mrs balls chutney collab

brand architecture

• optimising hierarchy , links, roles of brands in our porfolio and their relationships within the overall brand strategy.Lets barnds play multiple roles

types

branded house : Monolithic → one master brand w a single name under which everything is unified 1 visual system : bmw. features of that subbrand less important than the brand promise

Endorsed→ Endorsement by the parent product w clear market presence .Nestle products , kellogs : small in the corner , focusis on subbrand

house of brands 🇦

1. Free standing → unilever : lots a brands w seperate corporate identities under one org

2. hybrid → combo of mono,branded,endorsed . Happens thru mergers/acquisition

How to choose the right architecture for desired product attributes

• keep strategy in mind

• must be simple

• think of client needs

• think if values align

• flexibility?

Activation v brand building

activation → encourage immediate short term sales → bogof , discounts

building→ encourage sustainable long term sales thru loyalty + brand identity

DONT MIX THESE TACTICS → dilutes effectiveness of strategy

characteristics of bizz w strong differentiation going on

• access to scientfic research

• strong development team

• good sales team that communicates product strengths well

• quality + innovation reputation

salience

assumed relevance/imporatnce brands think they have to consumers - i am a loyal consumer of colgate but i dont think abt or care abt the product

why distinctiveness is most important - byron sharp

when a brand looks like itself - easily recognizable, noticeaball , good brand recall . more important than differentiation , not the main driver for being competitive

combo of differentiation + distinctiveness is best

Product levels

1. core benefit → not the bennies of actual product , what customer need is it adressing . Ipad → communication

2. actual product → tagible features : pro max what what what

3. augmented product → added services n benefits to product → warranty , free cleaning , customer support

product types

• consumer : convenience (day-to-day,cheap,accesible),shopping (less locations , not bought super often,specialiaty - luxury , unsought (not often thought about by consumers)

• industrial products : Materials + parts, Capital equip , supplies+ services

• Organisations,ppl (pr celebs),place,idea :

Individual product decisions

quality (level + consistency), style & design, support services

Experience → cape union marts cold chamber , coke making u your own can

Diffusion of new innovations (spreading acceptence of an innovation over time thru communicating w members of a social sytem)

elements

1. Innovation

2. channels of communiation

3. social sytem

4. time

look @ product life cycle slide

product develop,intro , growth , maturity , decline

Test technique : Decide if this new product is a good idea

1. Why are they doing this ?- why would a business want to make a new product - share of wallet , growth , diversifictaion , spread risk , enter new market

2. Is it a good idea? - look at horns v halo effect,etc

3. What strategies and tactics? - Multi branding? Co-brand? Liscensing? 4 Ps :Product ? Price? Promo? Place?