Bus 188 Part 2Bus 188 Part 2

The Marketing & The Marketing & Situation AnalysisSituation Analysis

Part 2 - The Marketing Part 2 - The Marketing & Situation Analysis & Situation Analysis Topic 5. Define Your market

Topic 6. Personal Audit

Topic 7. Competition

Topic 5Topic 5Define Your MarketDefine Your Market 1. Estimate Demand:

Demand is a forecast of future buyer behavior characterized by:

Demand is...Demand is...…willingness of potential buyers to purchase a given amount of goods and services at a given price at a given time under given circumstances...change these factors and demand will respond.

DemandDemand it presumes the ability to pay. demand may be split amongst

competitors. Past demand (actual) has been

recorded and can be looked up. (market shares).

potential new users can be estimated.

2. Factors Affecting Buyer 2. Factors Affecting Buyer BehaviorBehavior

# of available substitutes? Quality of available substitutes? Can the buyer do without the

product? Can the buyer postpone the

purchase? Is it a hi or lo-involvement decision?

Factors Affecting Buyer Factors Affecting Buyer BehaviorBehavior How motivated is the How motivated is the

buyer?buyer? How strong are the How strong are the

competitors efforts?competitors efforts? Seasonality?Seasonality? Other factors?Other factors?

General Buyer Behavior is a General Buyer Behavior is a Result Of:Result Of: Individual and Internal Individual and Internal

FactorsFactors

Group and External Group and External FactorsFactors

Individual & Internal Factors Individual & Internal Factors affecting Buyer Behavioraffecting Buyer Behavior PersonalityPersonality LearningLearning PerceptionPerception MotivationMotivation AttitudesAttitudes

Group & External Affects on Group & External Affects on Buyer BehaviorBuyer Behavior CultureCulture SubcultureSubculture Social ClassSocial Class Peer GroupsPeer Groups

Reference Reference GroupsGroups

Physical Physical EnvironmentEnvironment

Political/LegalPolitical/Legal MarketersMarketers

A. Describing Your Market (s)A. Describing Your Market (s)

Decision Making Units - DMU's, Decision Making Units - DMU's, basic element making up your basic element making up your potential marketpotential market• Person (individual)Person (individual)• Informal Groups (Family, Informal Groups (Family,

Roommates)Roommates)• Formal Groups (Businesses, Formal Groups (Businesses,

Resellers, Government Agencies)Resellers, Government Agencies)

B. Set Limits and Define the B. Set Limits and Define the Potential MarketPotential Market GeographicsGeographics DemographicsDemographics LifestyleLifestyle

AIOAIO

PsychographicsPsychographics

Brand LoyaltyBrand Loyalty Usage PatternsUsage Patterns Key BenefitsKey Benefits

needs/wants/needs/wants/motivationsmotivations

C. Identify Market Segments & C. Identify Market Segments & Target marketsTarget markets DemandDemand

• # of Customers # of Customers (DMU’s)(DMU’s)

• $ Sales Volume$ Sales Volume• Unit Sales Unit Sales

VolumeVolume Market Market

PenetrationPenetration Market ShareMarket Share

Special SegmentsSpecial SegmentsNichesNiches

Targeting Targeting StrategiesStrategies• UndifferentiatedUndifferentiated• DifferentiatedDifferentiated• ConcentratedConcentrated• AtomizedAtomized

D. Describe The Typical D. Describe The Typical Consumer In Target MarketConsumer In Target Market

Roles Within The Roles Within The Decision Decision Making Units Making Units Are:Are:

Decision Decision MakerMaker

PurchaserPurchaser InfluencerInfluencer UserUser

5. Decision Making Process5. Decision Making Process

(1) Recognize Needs/Wants - (1) Recognize Needs/Wants - MotivationMotivation

A. Instant Evoked SetA. Instant Evoked Set (2) Information Search(2) Information Search

A. A. Internal - Evoked SetInternal - Evoked Set(mental search)(mental search)

B. ExternalB. External

5. Decision Making Process cont.5. Decision Making Process cont.

(3) Evaluate Alternatives/Make (3) Evaluate Alternatives/Make DecisionsDecisionsWhat, Where, When, How To BuyWhat, Where, When, How To Buy

(4) (4) Implement Purchase DecisionsImplement Purchase Decisions (5) Post-Purchase Evaluation - (5) Post-Purchase Evaluation -

Establish a Probability Of Repeating Establish a Probability Of Repeating Same Purchase Decision = Same Purchase Decision =

P(Beh.)P(Beh.)

Analyzing DemandAnalyzing Demand

Lo vs. Hi Involvement DecisionsLo vs. Hi Involvement Decisions Purchase CyclePurchase Cycle

Frequency of purchasesFrequency of purchases

Purchase QuantityPurchase Quantityper visit, avg. per month, etc.per visit, avg. per month, etc.

PerceptionsPerceptionsproduct type, brand issuesproduct type, brand issues

Key Decision FactorsKey Decision Factors

Analyzing DemandAnalyzing Demand

Who is the customer?Who is the customer? geographicallygeographically demographicallydemographically Lifestyle/AIO/PsychographicallyLifestyle/AIO/Psychographically Loyalty/UsageLoyalty/Usage Key benefits sought/wants & Key benefits sought/wants &

needsneeds

Average $ Sales per Average $ Sales per Customer VisitCustomer Visit

dailydaily weekly weekly monthly monthly

# of customers# of customers ____________________ ____________________ ____________________

# of units# of units____________________ ____________________ ____________________

$value$value __________ __________ ____________________ ____________________

/revenue/revenue

High and Low RangeHigh and Low Range

____________ _________________________ _____________

Seeking A Competitive Seeking A Competitive AdvantageAdvantage 1960’s - Marketing Based1960’s - Marketing Based

1970’s - Manufacturing Based1970’s - Manufacturing Based

1980’s - Quality Based & TQM1980’s - Quality Based & TQM

1990’s - Customer Service Based1990’s - Customer Service BasedSOURCE: Total Customer Service: the Ultimate Weapon by Davidow & Uttel; Harper PerennialSOURCE: Total Customer Service: the Ultimate Weapon by Davidow & Uttel; Harper Perennial

Identifying CompetitorsIdentifying Competitors

1. 3 types based on 1. 3 types based on needs filled & similarity needs filled & similarity of the product/service:of the product/service:

2. Unrelated: 2. Unrelated: competition for the same competition for the same $.$.

Identifying Competitors cont.Identifying Competitors cont.

Need Product/Service

1) Direct Same Similar

2) Indirect Same Dissimilar

3) Generic same Unalike

Identifying Competitors cont.Identifying Competitors cont.

Unrelated: Unrelated: competition for the competition for the same $.same $.

(Gross Income; Disposable (Gross Income; Disposable Income; Discretionary Income; Discretionary Income)Income)