intro marketing elearning
TRANSCRIPT
Marketing process and concepts
Laurence COGAN
Autumn 2009 – ESC 2nd Year
Sessions’ Organization: Syllabus
• Session 1: Introduction to marketing
• Session 2: Product policy (1)
• Session 3: Product policy (2)
• Session 4: Pricing Policy
• Session 5: Promotion policy
• Session 6: Communication policy
• Session 7: Case study Babolat
Final exam
Sessions’ Organization
• 7 sessions
• 4 marks
- One oral presentation
- A written report (25% of the mark)
- Case study (25% of the mark)
- A final exam (50% of the final mark)
Session 2: each group presents the brand of their choice (5 minutes)
Session 4: 2 groups present the product policy (15 minutes)
Session 5: 2 groups present the pricing policy (15 minutes)
Session 6: 2 groups present the distribution policy (15 minutes)
Session 7: Case study Babolat (each group responds to one question)
Final ReportEthnic & minority groups’ products
• Ethnic products: ‘ brand’s product or service targeting an ethnic group’.
• Exotic/foreign products
• Organic products
• Can also include minority groups’ products:– Disabled people– Children– Teenagers– Seniors…
Types of ethnic/exotic products
• Food
• Clothes
• Accessories & jewels
• Cosmetics
• Hair products
• Furniture
• Decor
• Others…
Lecture OutlineLecture Outline
Evolution of marketing conceptEvolution of marketing concept Core concepts of marketingCore concepts of marketing Marketing toolsMarketing tools
Marketing environmentMarketing environment
• According to you, what were the key marketing innovations of the last 30 years ?
Discussion
How can we define marketing?
ExerciseDefinition of marketing?
• You’re attending a business diner and the subject of the discussion is about the new marketing management policies
How would you define marketing?
MarketIntegratedmarketing
Profits throughCustomer satisfaction
Customerneeds
The marketing concept
CompanyExisting
productsSelling &
promotingProfits through
Sales volume
Startingpoint Focus Means Ends
The selling concept
Marketing & Sales Concepts
Definition
• American Marketing Association (AMA)
«Marketing is the process of planning and executing the conception, pricing, promotion, and distribution of goods, ideas, and services to create exchanges that satisfy individual and organizational goals.»
BarteringFirst
1800
College coursesIn distribution
Début 1900
1930
First marketingtheories
1960
Marketingresearch
1970
Becomes a major Business fonction
1980 à 1990
Focus on customer& external environnement
Michael R. Czinkota and Masaaki Kotabe, Marketing Management, 2nd Edition
History of Marketing Thought
Marketingis not economics
Production Marketing StrategiesMain issues
• Products are costly• Demand is bigger than supply’s potential
Price : $ 825 on 1st October 1908Productivity in 1908 : 12H et 8 minutes to assemble a Ford T Productivity in 1980: 2 H et 35 minutes
Slogan : My customer can choose the colour of his car… as long as it’s black!
Ford TFord T
Lecture OutlineLecture Outline
Evolution of marketing conceptEvolution of marketing concept Core concepts of marketingCore concepts of marketing Marketing toolsMarketing tools
Marketing environmentMarketing environment
Products, services& experiences
Products, services& experiences
Needs, wants & demandsNeeds, wants & demands
MarketsMarkets
Value, satisfaction& quality
Value, satisfaction& quality
Exchange, transactions& relationships
Exchange, transactions& relationships
Core MarketingConcepts
Source: Principles of Marketing. by Kotler, Armstrong, Saunders and Wong
Needs, wants & demands
Needs
Difference between a consumer’s actual state & desired state:
• psychological needs• physiological needs
Demands
Needs backed up by
purchasing power & resources
Desires
Desire for a particular product used to satisfy a need and influenced by culture, society & personality
Maslow’s Hierarchy of Needs
Physiological
Safety
Love/Belonging
Esteem
Self-actualization
Drugs
Ex: diabetic
Vaccines, vitamins,Sleeping pills
New molecules Ex: DHEA, Viagra
Mobile phones
Be reachable everywhere
Ex: for young people
Show that you’re successful
• Products – Anything that can be offered to a market to satisfy a need or a want
ex. People, places, organizations
What can you satisfy customers’ demands & needs?
• Services – Activities or benefits offered for sale, that are essentially intangible
and don’t result in the owing of anything
ex. Banks, airflights, hair cuts, hotels.
Reliable equipment
Reasonable price
On time delivery
Financing possiblities
Attentive after sales service
Reliable equipment
Reasonable price
On time delivery
Financing possiblities
Attentive after sales service
Profitable price
On time payment
Profitable price
On time payment
Renault
trucks
Renault
trucks
Customer company
Customer company
Needs or recognition of a problem?
Desired state
Actual state
An opportunity arises :ADSL allows you…
With red fruit…Why pay more…The real luxury…
A Need appears :No more bread…
Television doesn’t work… The flat is too small…
Friends use make-up…
Source : Solomon, 1996
Differences between Products & Benefits
“Customers don’t buy products,They seek to acquire benefits”
Michael R. Czinkota and Masaaki Kotabe, Marketing Management, 2nd Edition
PRODUCTS BENEFITS
• Physical attributes
• Example: 2 mm drill
• What customer wants
• Example: a 2mm hole
Delivery of customer satisfaction at a profit
Managing profitable customer relationships
Attracting new customers Retaining actual customers
Marketing doesn’t amount to « sales » or « advertising »
What is marketing ?
Economic definitionPlace where buyers and sellersmeet to exchange their products
Marketing definitionPotential & actual customers
of a product
What is a market?
A market can be defined according to a product or a product line range in given time at a given place.
A market is made of all actorsinfluencing consumption patterns.
Definition of a Market
Why people buy products?
• Three basic reasons
– To satisfy needs
– To solve problems
– To make themselves feel good
Lecture OutlineLecture Outline
Evolution of marketing conceptEvolution of marketing concept Core concepts of marketingCore concepts of marketing Marketing toolsMarketing tools
Marketing environmentMarketing environment
Difference in terms of marketing strategy?In terms of Mix?
Segmentation Competitors’Analysis
Strategic MarketingGeneral Procedure
Perceived position
Implementation ofMarketing mix
Choice ofTarget market
Choice ofA difference
Chosen position
Resources & Capabilities
Source : Marion et al, 2003
Dividing a market into different customers groups :
The groups have to be as distinctive as possible and
might require separate products or mixes
In using pertinent segmentation criteria
What is market segmentation ?
Each group is composed of buyers with very similar needs, characteristics or
behaviour
Segmentation Targeting Positioning
Shampoo Market
• Segmentation according to the demand- according to the socio-demographic criteria (age, sexe, gender,
profession, social class…)- According to the type of hair (fine, greasy…) - Purchase location (hairdresser’s, supermarkets…)
• Segmentation by benefit required (volume, antidandruffs, aging hair…)
Helps to describe the customers (qualitatively & quantitatively)
ex: women aged 50 years + and buying their shampoo at the hairdresser’s
What is market targeting ?
Choose one or several segment(s)
According to itspotential :
VolumeValue
GrowthRevenue
…
According to itspotential :
VolumeValue
GrowthRevenue
…
According to the firm’s strenghts.
Resources, Capabilities :
PatentTechnology
BrandKnow-how
…
According to the firm’s strenghts.
Resources, Capabilities :
PatentTechnology
BrandKnow-how
…
Segmentation Targeting Positioning
Target Market – Choice of products Attractiveness-strenghts Matrix
Firm’s strenghts
Professionnals
Seg
men
t’s
attr
acti
ven
ess
Show-offs
Young People
Ex. : Mobile Phones
Source : Marion et al, 2003
Market Positioning
‘ Arranging for a product, a service, a company, an institution or even an individual, a distinctive and desirable
place relative to competing products in the mind of the target markets. Positioning is not what you do to a product.
Positioning is what you do in the mind of the prospect. What matters is how potential buyers see the product. ‘
Segmentation Targeting Positioning
Source : Ries & Trout, 1981
Positioning : 2 examples
‘Actimel is a new way for the whole family to start their morning which helps to reinforce the
body’s natural defense mechanisms’
‘Pouss’Mousse is a new line of modern soaps
which allows to clean one’s hands in an amusing way
for the entire family’
Implementation of target positioningThe marketing mix
Product
Price 5 € 20 €
Place Supermarkets Drugstores
Promotion
Ikea desired positioning
Vision: a good product range of designed home furnishing products sold at Ikea stores only at a reasonable price.
Desired market positioning: « IKEA offer a wide range of well designed, functional home furnishing products at prices so low that as many people as possible (especially young people) will be able to afford them. »
Marketing Mix Positioning at IKEA
• Product : an extensive & coherent product range. Flat-pack furniture, functional and appealing, good quality and reasonably priced (« democratic design »)
• Price: excellent value for money
• Distribution: IKEA stores are located at the outskirts of towns (first Show rooms)
• Communication: catalogue (main marketing tool)+ advertising campaigns (billboards) + TV ad
Physical distributionPhysical distribution
SuppliesSuppliesInventoryInventoryStorageStorage
TransportationTransportationWarehousingWarehousing
Distribution channelsDistribution channelsRetailersRetailers
DistributorsDistributorsWholesalersWholesalers
Export/importExport/import
Product MixProduct Mix
Product line rangeProduct line rangeDesign conceptDesign conceptColor appealColor appeal
StyleStylePackagePackage
Brand nameBrand nameService functionService function
WarrantiesWarranties
Price MixPrice Mix
Price structurePrice structurePayment termsPayment terms
CostsCosts
Communication MixCommunication Mix
AdvertisingAdvertisingSales catalogSales catalog
Field sales forceField sales forceTelephone salesTelephone salesPublic relationsPublic relations
Direct mailDirect mailSales promotionSales promotion
Premiums & discountsPremiums & discountsMerchandisingMerchandising
ResearchResearchElectronic interactionElectronic interaction
Marketing-MixMarketing-Mix
Leader in the capsule coffee market, Nespresso intends to redefine the way coffee is drunk at home, as well as in offices, restaurants and cafés. The idea is to give the consumers the opportunity to drink an excellent coffee.
Nespresso brand positioning
Nespresso: What else?
• Product policy- Selection of the best coffee beans- Technological innovation to allow a high quality blend- Accessories & peripheric services- Strong design
• Pricing policy- Coffee marchine from € 179 to €1,749, & capsules at 33c
• Distribution: exclusive
• Communication- A prestigious ambassador- Club Nespresso
Marketing strategy& environment
Laurence Cogan
- Opportunities- Threats
External analysisopportunities, threats, trendsuncertainties & strategic choices
Situation Analysis &Strategic Choices
- Strenghts- Weaknesses
Internal analysisstrenghts, weaknesses, problemsconstraints & strategic options
IdentificationOfStrategicoptions
Selection of the best strategy
Marketing Diagnostic Procedure
MACROMACRO
EXTERNAL MICROEXTERNAL MICRO
MARKET DIAG.MARKET DIAG. INT. DIAG.INT. DIAG.
DIAGNOSTICDIAGNOSTIC
INTERNAL
Goals MIX Variables
INTERNAL
Goals MIX Variables
O T S W
Organization’s environments
Global Environment
Privatisation
Deregulation
Technological
Political
SocioculturalDemographic
EconomicLegal
Natural
GeneralEnvironment
Publics
SuppliersBuyers
Potential competitors
Current competitors
Specific environmentMicroenvironment
Intermediaries
Organization
The environment is made of actors and forces affecting the management’s capacity The environment is made of actors and forces affecting the management’s capacity to develop and maintain a competitive advantage and successful relationships with to develop and maintain a competitive advantage and successful relationships with its customers.its customers.
Company’s specific environment
CustomersMarkets
Source: Marketing: An Introduction, by Kotler & Armstrong
The micro-environnement (specific environment) Forces that affect directly the decisions and actions of a company
CompetitorsCompetitors
CompetitorsCompetitors
CompetitorsCompetitors
CompetitorsCompetitors
Intermediaries
Inte
rmed
iarie
s Intermediaries
Intermediaries
SuppliersSuppliers
SuppliersSuppliers
Customers – Those who purchase a company’s goods or services
Competitors – Those who serve the target market with similar products or services against whom a company must gain a competitive advantage
Suppliers – Those who provide the resources necessary to produce goods and services – an important link in the “value delivery system”
Intermediaries – Help the company promote, sell, distribute goods to the final buyers (marketing & financial)
Publics – Any group that perceives itself having an interest in a company’s ability to achieve its objectives
Marketing’s Micro-environnement
Source: Marketing: An Introduction, by Kotler & Armstrong
Company’s general environment
DemographicDemographic
NaturalNatural
CulturalCultural Economic Economic
PoliticalPolitical
TechnologicalTechnological
Source: Marketing: An Introduction, by Kotler & Armstrong
The Macro-environnement The Macro-environnement (general environnement)(general environnement) Forces that affect directly the microenvironnement and indirectly the decisions and actions of a company
Laurence COGAN ESC Dijon 2nd Year
Executive SummaryQuick review of plan for quick management reviewExecutive SummaryQuick review of plan for quick management review
Current Marketing SituationAudit of market, product, competition & distributionCurrent Marketing SituationAudit of market, product, competition & distribution
SWOT AnalysisKey strenghts, weaknesses, opportunities & threatsSWOT AnalysisKey strenghts, weaknesses, opportunities & threats
Objectives and IssuesObjectives in terms of sales, market share and profitsObjectives and IssuesObjectives in terms of sales, market share and profits
Marketing StrategyBroad approach to achieve the plan’s objectivesMarketing StrategyBroad approach to achieve the plan’s objectives
Action ProgramsWhat will be done, by whom, when it will be done and how much it will costAction ProgramsWhat will be done, by whom, when it will be done and how much it will cost
BudgetsProfit & loss statement that forecast the financial outcomes of the planBudgetsProfit & loss statement that forecast the financial outcomes of the plan
ControlsHow the program of the plan will be monitored?ControlsHow the program of the plan will be monitored?
Contents of a Marketing Plan
Questions???