Untitled Flashcards Set
Competition & Business Environments
Who is My Competition?
Companies selling the same product (cheap vs. premium versions).
Companies making substitutes for your product.
Companies competing for customer budgets (e.g., streaming services vs. movie theaters).
Startups with disruptive technology.
Category Captain: A leading brand in a retail category that helps retailers decide which products to stock.
Challenges in Understanding Customer Needs:
Needs change constantly.
Customers may not know what they want.
Consumer behavior varies by product, context, and people involved.
Marketing Strategies & Tools
B2B vs. B2C Marketing
Trends in B2B Marketing
Inside Sales Force: Handles simpler sales remotely.
Outside Sales Force: Deals with complex sales and builds relationships.
AI in B2B: Used for lead generation, customer profiling, and sales predictions.
Macro Trends in Marketing
Demographic: Aging population, changing family sizes.
Social: Health, sustainability concerns.
Technological: AI, online shopping growth.
Economic: Inflation, recession risks.
Political: Government regulations, trade policies.
Corporate Growth Strategies
Market Penetration: Selling more of existing products to current markets.
Product Development: Creating new products for existing customers.
Market Development: Expanding into new markets with existing products.
Diversification: Entering completely new markets with new products.
BCG Matrix (Business Growth Tool)
BCG Matrix Pros:
Easy to use
Helps decide where to invest
BCG Matrix Cons:Assumes all businesses are independent
High market share ≠ always profitable
Segmentation & Targeting Strategies
Segmentation Methods:
Geographic (location-based)
Demographic (age, gender, income)
Psychographic (lifestyle, values)
Behavioral (buying habits)
Targeting Approaches:
Niche Market: Focuses on small, specialized groups.
Mass Market: Tries to reach everyone (e.g., Coca-Cola).
Growth Market: Targets fast-growing segments.
Positioning & Repositioning
Physical Positioning: Based on real product features (e.g., battery life).
Perceptual Positioning: Based on customer perception (e.g., luxury branding).
Repositioning: Changing how a brand is seen in the market (e.g., Garmin shifting from car GPS to fitness devices).
Consumer Insights & Post-Purchase Management
How to Get Consumer Insights:
Surveys, focus groups, digital tracking, social media analysis.
Why Post-Purchase Management Matters:
Impacts customer satisfaction, loyalty, and brand reputation
Industry Attractiveness & the PC Industry
Industry attractiveness determines if a market is profitable and worth entering. A common tool used for this is Porter’s Five Forces:
Threat of New Entrants – Can new companies enter easily? (PC industry: Moderate – high costs but some new brands emerge).
Bargaining Power of Suppliers – Do suppliers have control over pricing? (PC industry: Low – multiple suppliers like Intel, AMD).
Bargaining Power of Buyers – Can customers demand lower prices? (PC industry: High – many brands to choose from).
Threat of Substitutes – Are there alternatives? (PC industry: High – tablets, smartphones replacing PCs).
Industry Rivalry – How intense is competition? (PC industry: High – Dell, HP, Apple, Lenovo constantly competing).
What Makes an Opportunity Attractive?
A business opportunity is worth pursuing when it meets these criteria:
✔ Proprietary Advantage – The company has something unique (e.g., a patent, strong brand).
✔ Difficult to Imitate – Other companies can’t easily copy the business model (e.g., Apple’s brand ecosystem).
✔ Economic Viability – The company’s model makes financial sense (e.g., many dot-com businesses failed in the 2000s because they lacked profitability).
Focus Groups: Pros & Cons
Pros:
✅ Provides deep insights into customer preferences.
✅ Encourages real-time discussion for better understanding.
✅ Helps companies test ideas before launching products.
Cons:
❌ Expensive and time-consuming.
❌ Small sample size = not always representative.
❌ Groupthink – people influence each other’s opinions.
👉 Alternative Methods for Customer Insights
Surveys (larger sample size, cheaper).
Social media analysis (real-time, unfiltered opinions).
Data analytics (tracks actual buying behavior).
Challenges in Understanding Customer Behavior
Customers are diverse – Different people want different things.
Behavior changes by product and situation – A person buys coffee differently than they buy a car.
Social influences matter – Friends, influencers, and media shape buying choices.
Why Manage Post-Purchase Outcomes?
After buying a product, customers:
Feel happy = brand loyalty (good reviews, repeat purchases).
Feel buyer’s remorse = negative perception, refunds, bad word-of-mouth.
👉 Managing post-purchase experiences helps:
Improve customer satisfaction.
Reduce returns and complaints.
Strengthen brand loyalty.
Dark Sides of Marketing to Youth
👎 Concerns:
Overconsumption (kids pressured into buying things they don’t need).
Unrealistic body images (beauty standards, fitness ads).
Addiction to technology (targeted ads in gaming and social media).
🛑 How Countries Are Protecting Youth:
Limits on junk food advertising (UK bans unhealthy food ads for children).
Stricter data privacy laws (COPPA in the U.S. protects children’s online data).
Bans on deceptive marketing (Sweden bans direct advertising to kids under 12).
Segmentation: Why It’s Important
✔ Populations are aging or shrinking – companies need new ways to grow.
✔ Customers are more diverse and picky – mass marketing doesn’t work.
✔ Microsegmentation allows companies to target specific needs.
Types of Market Segmentation
Geographic – Based on location (e.g., McDonald's menu varies by country).
Demographic – Age, gender, income (e.g., luxury brands target high-income consumers).
Psychographic – Lifestyles, values (e.g., eco-friendly brands appeal to environmentalists).
Behavioral – Buying habits (e.g., frequent vs. occasional coffee drinkers).
Benefit-Sought – What people want (e.g., whitening toothpaste vs. cavity protection).
Assessing Segment Attractiveness
🔍 Use these criteria:
✔ Substantial – Big enough to be profitable.
✔ Reachable – Can be targeted through ads.
✔ Responsive – Customers will actually buy.
✔ Profitable – Good revenue potential.
✔ Identifiable – Clear who belongs in the segment.
Three Targeting Strategies
Niche Market Strategy – Focuses on small, specialized groups (e.g., luxury watches).
Mass Market Strategy – Targets everyone (e.g., Coca-Cola).
Growth Market Strategy – Focuses on fast-growing segments (e.g., electric cars).
Positioning: Physical vs. Perceptual
🔹 Physical Positioning: Based on real product features (e.g., battery life, horsepower).
🔹 Perceptual Positioning: Based on brand image and consumer perception (e.g., Rolex = luxury, even if cheaper watches exist).
👉 Benefits of Physical Positioning:
✅ Easy to compare features.
✅ Useful for new product development.
👉 Limitations of Physical Positioning:
❌ Customers often care more about perception than features.
❌ Not always meaningful (e.g., megapixels in cameras don’t always = better pictures).
What is a Value Curve?
A value curve is a graph showing how different brands compare on key attributes. It helps companies:
Find competitive advantages.
Identify opportunities for differentiation.
See where they are weak vs. competitors.
Positioning vs. Repositioning
✔ Positioning – Creating a brand image from scratch (e.g., Tesla as innovative and high-tech).
✔ Repositioning – Changing how a brand is seen (e.g., Old Spice going from an “old man” brand to a cool, young brand).
Consumer Insights & Business Benefits
🔍 Why They Matter:
Help design better products.
Improve marketing effectiveness.
Increase customer satisfaction and loyalty.
How to Get Consumer Insights:
📊 Surveys & Focus Groups – Ask people directly.
💻 Social Media Monitoring – Track trends.
📈 Data Analytics – Look at customer behaviors.
Product-Centric vs. Customer-Centric Business Models
🏭 Product-Centric – Focuses on what the company makes (e.g., Kodak making film instead of adapting to digital cameras).
👤 Customer-Centric – Focuses on what customers want (e.g., Netflix using data to suggest personalized shows).