marketing chapter 1-7
Define Marketing
is the activity, set of institutions,
and processes for creating, communicating, delivering,
and exchanging offerings that have value for customers,
clients, partners, and society at large
What is marketing responsible for
- Ensuring that a firm
understands its customers
•
Finding the best ways
to reach customers
•
Encouraging customers
to purchase
•
Turning customers into
brand loyalists
What is the marketing concept
The Marketing Concept is a management orientation
that focuses on identifying and satisfying consumer needs
7 ps of marketing
The mix marketing of 7 ps should work together to bring value to the customer and provide what the customer needs
The 7 Ps: Product, Price, Place, Promotion,
People, Physical Evidence, & Process
Marketing Management
setting marketing goals, the planning and excution of activities to meet these goals , and meauring progress towards their acheivements
Product
good or service that satisfys a customers need
- product quality
- packaging
- colour
- flavour
Price
amount being charged for good or service
- cost based, valued base, competitors based
- luxury pricing
- buy one get one
- customer discounts
Place
getting the good or service to the customer
- store shelf
- companys own website
- third party website such as amazon
Promotion
communicating with the customers
- advertisements
- public relations
- sponsorships
Process
flow of activities involved in providing goods, services, and ideas to the customers
- service blueprint to outline process
- supply chain
- distubution channels
- marketing research
People
the people who provide goods or services and ideas to the customer
- sutomer facing employees
- customer service representatives
- salespersons
Physical evidence
tangible elements in the place that the service or good is sold
- sinage
- uniforms
- lighting
- decor
Marketing Research
Different types of research performed
by marketers using various methods depending
on their need for information.
Gaining Customer Insight
Regular market research gives marketers
a competitive edge.
Research Questions
• Usually made to target
a specific problem
• Seek feedback from
consumers
• Can be very clear or hazy
Explarotary Research
Useful in gaining insights and ideas and is often used
to funnel broad research questions into more precise
ones
- Qualatative in nature
- open ended questions
- give feedback on consumers thoughts opinions, reasons, motivation
What is Descriptive Research?
Focuses on determining how often something occurs or how things are related to eachother
- Quantatative in nature
- ideal for quantifying feelings, attitudes, opinions of a specific population through structured set of questions
- research comes from numerical response (surveys)
What is Casual research?
Focuses on discovering the cause-and-effect relationship
between variables
- quantatative in nature
Deeper Look
at Exploratory Research
Secondary Data
- Pre-existing data found
through literature searches
or data mining
Benefits of Using Secondary Data
• Low costs
• Available immediately or almost
immediately
• Often easy to find
Primary Data
-New data that researchers
must collect
Benefits of Using Primary Data
• Tailored to a specific research question
• Variety of ways to find them
• May help research questions besides yours
in the future
Where to Find Them ...
Depth interview
Focus groups
Case analyses
Projective methods
Types Of Primary Data that mesures (Consumer Behaviour)
- Demographic (income, education, gender, shows group that is loyal to brand)
- Awareness (Knowlege of brand/products)
- Intention ( anticipated behaviours, predict future consumption)
- Motivation ( Motives of consumers, what drives behaviour)
- Attitude (feelings or beliefs about brand)
- Psychgraphic ( personality traits, opinions, lifestyle, lets markets create a persona of the ideal customer)
What is a Net Promoter Score (NPS)
- tye of survey to measure the experience customers have with their brands
calculated by subtracting the percentage of detractors form percentage of promoters= NPS
Promoters (scores of 9 and 10)
Customers who are loyal enthusiasts
Passives (scores of 7 and 8)
Customers who are satisfied but not
enthusiastic about the brand
Detractors (scores 0 through 6)
Customers who are unhappy and can
hurt your brand
Creating a survey
1. Reexamine research question ( survey is built to answer primary research question)
2. Specify what information the survey must collect (dont collect every bit of information)
3. Identify who should take the survey
4. Develop the question to ask ( what type of question? answers should you provide how may?)
5. create dummy table to show how you will use data ( a table that shows how to analzye, use and present data)
6. Devise a way to recruit people to take survey
7. Build and test survey (fix any mistakes)
8. Field survey ( make visibe to population target)
Survey Design mistakes
- Failing to build the survey around the research
question
• Failing to understand the survey population
• Forgetting to explain the purpose of your survey
Asking too many questions
• Asking too few questions
• Putting the most important questions
at the end of the survey
• Requiring participants to answer
all the questions
What is Marketing Segmentation?
The process of breaking down large groups
into smaller groups based on meaningful
characteristics and shared needs
Why divide?
Not everyone is the same.
Not everyone has the same needs.
How do we segment
Demographic (age, income,gender)
Psychographic (values, interests, lifestyle)
geographic (location, country, city/rural)
Usage Behaviour ( how often a consumer uses or how a consumer uses a product. How? When? How Often?)
Steps to creating a meaningful
market segment
Choose meaningful characteristics
Choose the number of characteristics to include
Determine if the segment is a desirable market segment
Choose meaningful characteristics (consumers with similar needs)
Choose the number of characteristics to include
Determine if the segment is a desirable market segment
Target markets should be...
• Identifiable (identifiable if a marketer can clearly
identify the segments and can describe the traits
or characteristics of that segment)
• Sizable ( sizable when there are enough consumers
within the group to support profitable product sales)
• Stable ( more stable if it is predictable in its
purchasing ability and behavior)
• Accessible (accessible if a marketer can reach
the consumers for marketing and for sales of the
product)
• Congruent ( aligns with the company’sobjectives and resources)
Undifferentiated Marketing
When a marketer uses only one strategy
or marketing mix for the entire market
Also known as mass marketing
Differentiated Marketing
When a company targets more than one market
segment and develops a unique marketing mix
to target each segment separately
Concentrated Marketing
When a marketer selects one target market
and customizes a marketing mix
for that target market only
The Buyer Persona
- A representation of a marketer’s market segment
- A Buyer Persona helps to give tangibles
a face to the target market
Creating a buyer persona
A good buyer persona should include enough
information to describe a real person — think
of your neighbor, one of your past instructors,
or a peer
Keep in mind: the buyer persona should be based
on real research
• Goals
• Values
• Challenges
- demographic information
- day in the life
What is positioning ?
Positioning is a strategy for defining and portraying
brands or products in ways that cause the ideal customers
to perceive them as the best solution for their needs.
- Why should I buy from you?
What is position?
the space in the market for which
a product is ideally suited
positioning statement
a succinct expression
of a product’s market position
unique selling proposition (USP)
an adaptation
of the product positioning statement for use in sales
dialogues and communications
When
consumers see
that products
are different
and better they:
• Pay more to buy them
• Develop loyalty toward
the brand
• Develop resistance to
competing product offers
• Become advocates
for the product
Positioning Strategies
Being First
- Those who are the first to accomplish something
earn awareness
- This can mean earning credit, free marketing,
or fame
Positioning as a Follower
- Any positioning for a product that is preceded
by a similar product
- Usually benefits from working with a niche market
- Finding differentiation is the most important piece
of this strategy
Repositioning
- Done when a current position no longer appeals
to a consumer base
- Done to take advantage of a competitor’s
weakness
Positioning Problems
- under-positioning: when a product has no clear
advantage or differentiation
- over-positioning: when the product has been
positioned too narrowly
- confused positioning: when a product is positioned
by claiming too many or contradictory benefits
- doubtful positioning: when the way a product
is positioned touts benefits that are simply not
believable or that are too good to be true
- irrelevant positioning: when a product claims benefits
or differentiation that no customers care about
Positioning Statement Template
For (target audience),
Product/Service is (concise description).
It is ideal for (best use or application) because
(primary benefit or differentiation).
Steps of buyer behaviour process
The Buyer Behavior Process helps marketers understand
what a customer goes through during a purchase.
- need recognition: consumer recognizes that he/she has
a need
- information search: consumer searches for information
- evaluation of alternatives: consumer looks at the different
available and viable options, then weighs the upsides and
downsides of each
- purchase: consumer decides to purchase, including
where and how to purchase
- reaction (also called “Post-purchase Behavior”):
consumer has consumed the “product,” be it a physical
product or service, and is pleased or displeased
Consumption
Using a good or service to fill a need.
Need
A gap between a consumer’s current state
and his/her desired state
Internal Cues
- Comes from within
a person
• Can be hunger or thirst
External cues
- Comes from the
environment
• Can be an advertisement
Top of Mind Awareness
The brands that a consumer first recalls
from memory
How to market in information search
- By making sure relevant information is available
and easily accessible
- By researching to find out when and where customers
are searching for information and making sure relevant
and accurate information is found there
Evaluative Criteria
The product attributes that are important
to a consumer
How to Market in Evaluation
of Alternatives
By making consumers
aware of how your
product matches the
attributes they value
Purchase Decision
The point when a consumer chooses which product
to purchase and also chooses where, when, and
how to purchase the product.
How to Market in Purchase Decision
-By assisting consumers in making the purchase decision
so that they can actually follow through on the purchase
-By offering different purchase options to the consumer
in this stage to provide further value
Reaction
After purchasing and consuming a product or service,
the customer compares the consumption experience
to his or her expectations
Where do
consumers
get their
expectations?
• Previous experience
• Advertisements
• Online reviews
• Friends’ recommendations
• Promises from salespeople
Search
Word of Mouth
A recommendation about a product or service
from a satisfied customer
How to Market in Reaction
-Marketers can find ways to increase word of mouth
-A marketer can work to decrease the possibility
of buyer’s remorse after a purchase by continuing
to provide marketing after the sale has occurred
Product attributes
The characteristics by which products are
identified and differentiated
Levels of attributes
- core benefit: the main benefit a consumer gets from a
product
• expected attributes: the basic attributes necessary
for delivering benefits or that have become expected
• add-on attributes: unexpected extra attributes
Four Product Categories
- convenience products: purchased frequently, widely
available, priced affordably
- shopping products: consumers spend more time
thinking about and purchasing a shopping product
- specialty products: have unique attributes
- unsought products: products that the consumers have
no awareness of until an external cue
Product Life Cycle
The typical pattern that a successful new product
takes, from development to the end of its life
1.Product Development
(The product is still being developed and tested)
- During this product development stage, it’s
important for a marketer to do any preliminary
marketing research to determine customer needs
2. Introduction
(The product is first offered for sale commercially)
- Marketing should focus on increasing brand
awareness by informing and educating consumers
about the product
3. Growth
(Here sales increase and profits rise)
- The marketing strategy here is to communicate
to consumers why that they should buy your
product
Maturity
(Product sales have leveled off and profits are
beginning to decrease)
-The marketing strategy here shifts from gaining
market share to maintaining it, and the promotion
focuses on reminding customers about the product
Decline
(In the decline stage, profits are dropping off
dramatically, and companies are exiting the market)
- No further money is invested into product
development or advertising.
product class:
a group of products that are generally
considered as substitutes for one another
product form:
smaller segment of the product class
- It refers to the different types of products or variations
within the product class.
Services Marketing
The process of planning, delivering, and then
improving the individual service acts
and performances that create memorable experiences when satisfying a buyer’s needs
Characteristics of serivices
Intangibility
- Services aren’t difficult to copy
• Displaying services and communicating about them
is difficult
• Pricing services is challenging
• Consumers perceive greater risk in services
• Many services are difficult to evaluate
Intangibility
Marketing for Intangibility
• Convey the benefits of the service
• Set consumer expectations
Purchasibility
• Businesses cannot hold services in inventory
• Balancing supply and demand is difficult
• Consumers can’t return services
Marketing for Perishability
• Companies should invest in resources and
personnel to deliver services at the appointed time
Perishability
Varibility
• Mass producing services that humans must
deliver isn’t possible
• Managing customer satisfaction is harder
• Achieving consistent service performance
is difficult
Marketing for Variability
• Train staff well
• Have precise performance standards
• Measure service outcomes to determine
customer satisfaction
Inseparability
• Customers impact other customers
• Employees impact the outcome
• Customer involvement is a must
Marketing for Inseparability
• The service, service provider, and customer
are intertwined
• This causes an opportunity to create a unique
and memorable experience for customers
Pre purchase vs Post purchase
Pre-purchase(evauate before buying)
• Rarely available
with services
• Tangible characteristics
Post Purchase (evauate after puchasing)
• Comparisons to
expectations and
alternatives
• Most common
with services
Customer Journey Map
A visual representation of every encounter and
experience a typical customer can have
Customer Journey Maps
Are effective when they...
• Are built from the customer’s perspective
• Include all points of contact between a customer
and a provider (touchpoints), digital and physical
• Span the full customer relationship lifecycle
- The heart of services marketing is consistently
providing superior customer experiences
Customer Lifetime Value
The total profit associated with a customer for the
duration of their relationship with the brand
Service Blueprint
A diagram that depicts a service process
and the relationships between elements
of the service and how they relate to the
touchpoints in the customer journey
Elements of a Service Blueprint
• People
• Physical evidence
• Technology
• Sequence
Blueprint Tangibles
• Ads and other marketing communications
• Exterior signage and the general exterior of shop,
such as landscaping
• Employees, the interior waiting area, and other aspects
of the waiting area such as furniture and magazines
• Employees, the service operation area, and materials
used in service delivery such as styling products and
equipment
Blueprint Failure Points
• Are used to identify areas where possible failures
may occur
• Are from the perspective of a customer
• May lead to a service recovery paradox
Service Recovery Paradox
A paradox that occurs when a failure and great
recovery results in a customer being
more satisfied than if there were no failure
in the first place
Service Provider Errors
• Task errors: performing the service process or task
incorrectly
• Treatment errors: failing to treat the customer properly
during an encounter
• Tangibles errors: problems with the tangibles
or physical artifacts associated with the service
Customer Errors
• Preparation errors: customer readiness issues
or failures
• Encounter errors: interaction problems between
customer and employee(s)
• Resolution errors: failure to report problems or take
proper post-encounter actions
• Preparation errors: customer readiness issues
or failures
• Encounter errors: interaction problems between
customer and employee(s)
• Resolution errors: failure to report problems or take
proper post-encounter actions