marketing 4 non marketing

7/28/2019 Marketing 4 NoN Marketing

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Marketing 4 NoN Marketing [email protected]

Marketing For Non

MarketingAhmed Kamel


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over the long run, the ability tolearn faster than your competition

may be the only sustainablecompetitive advantages.Arie De Geus

Head, Strategic Pla

Royal Dutch Sh


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What Is Marketing?THE OFFICIAL (AMAs) DEFINITION

Marketing is the process ofplanning and executing the

conception, pricing,

promotion and distribution of

ideas, goods and services to

create exchanges that

satisfy individual and organization

objectives


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Marketing

A social and managerial process wherindividuals and groups obtain what theneed and want through creating and

exchanging products and value withothers.


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Marketing Management

The art and science of choosingtarget markets and getting,

keeping, and growing customers throu

creating, delivering,and communicating superior

customer values.


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Core Marketing Concepts

Markets

Exchange,

transactions and

relationships

Value,

satisfaction,

and quality

Products and

services

Needs,

wants,

& demands

Core

Marketingconcepts


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Core Marketing Concepts

Markets

Exchange,

transactions and

relationships

Value,

satisfaction,

and quality

Products and

services

Needs, wants,

and demands

Core

Marketing

concepts


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Marketing Is A Managerial Process

ImplementationControl

Conception

Pricing

Promotion

Distribution

Products

Ideas

Goods

Services

Planning


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Marketing As An Exchange Activi

Two parties They should each possess something the

other wants

They must be able to communicate and de They must be free to accept the others offe


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Marketing & Prospects

A Marketeris someone seeking a respons(attention, a purchase, a vote, a donation)from another party, called the prospect.

If two parties are seeking to sell somethingeach other, we call them both marketers.


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Simple Marketing System

Industry

(a collection

of sellers)

Market

(a collection

of buyers)

Information

Money

Products-services

Communication


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Needs, Wants & Demand

Needsare the basic human requirements(food, water, air, clothing).

These needs become wants when they aredirected to specific objects that might satis

the need. Wantsare shaped by ones society.

Demandsare wants for specific productsbacked by an ability to pay.


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Product, Offering & Brands

Companies address needs by putting forth a valuproposi t ion, a set of benefits they to customers satisfy their needs.

The intangible value proposition is made physicaan of fer ing, which can be a combination of produ

services, information, and experiences. A Brandis an offering from a known source.

A brand name such as McDonalds carries manyassociations in the minds of people.


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Value & Satisfaction

The offering will be successful if it delivers value satisfaction to the target buyer.

The buyer chooses between different offerings onbasis of which is perceived to deliver the most va

Value can be seen as primarily a combination of

quality, service, and price (QSP), called the custvalue tr iad. Value increases with quality and service and

decreases with price.


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Value is a ratio between what the customegets and what he gives.

Customers gets benefits and assumes cos

Benefits include functional benefits andemotional benefits.

Cost include monetary costs, time costs,energy costs, and psychic costs.


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Value=Benefits

Costs

=Functional benefits + Emotional bene

Monetary + Time + Energy + Psych

Marketers can increase the value by:

Raise benefits

Reduce costs

Raise benefits by more than the raise in costsLower benefits by less than the reduction in costs


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Marketing Mix

Seven Ps

Product

Place

Price

Promotion People

Process

Physical evidence

Four Cs Customer solution

Customer cost

Convince

Communication


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Evolution Of The Business Philosophy

Socie

MarkeConc

MarketingConcept

Sellers Market Buyers Market

SellingConceptProductConceptProductionConcept

1930-1950 1950-1980 1980-

Focus on

product

design andquality

Focus on

aggressive

selling andpromotion

Focus onidentifyconsumer

needs anddevelopingmarketingprograms tosatisfy them

1880 - 1930

Balanccustomneeds,

firmsprofitssocietywell-be

Focus onincreasingproduction

andreducingcosts


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The Marketing Concept

The MARKETING CONCEPT holds that thkey to achieving organizational goalsconsists of being more effective than

competitors in integrating marketingactivities toward determining andsatisfying the needs and wants of targmarkets


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Production Concepts

The philosophy that the consumers will favproducts that are available and highlyaffordable and that management shouldtherefore focus on improving production an

distribution efficiency.


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Product Concept

The idea that consumers will favor productthat offer the most quality, performance, anfeatures and that the organization shouldtherefore devote its energy to making

continuous product improvements.


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Selling Concept

The idea that the consumers will not buyenough of the organizations products unlethe organization undertake a large-scaleselling and promotion effort.


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Marketing Concept

The marketing management philosophy thholds that achieving organizational goalsdepends on determining the needs and waof target markets and delivering the desire

satisfactions more effectively and efficientlthan the competitors do.


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Selling & Marketing Concepts

Existing

ProductsFactory

Selling &

Promotions

Profits through

sales volume

MarketCustomer

needs

Integrated

marketing

Profits through

Customer satisfaction

The selling concept

The marketing concept


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Customer Needs

As a marketer we should con sider:

Stated needs (the customer wants an inexpensive car)

Real needs (the customer wants a car whose operating cnot the initial price, is low)

Unstated needs (the customer expects good service from

dealer) Delight needs (the customer would like the dealer to inclan onboard navigation system)

Secret needs (the customer wants to be seen by friends savvy consumer)


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The Societal Marketing Conce

The SOCIETAL MARKETING CONCEPTholds that the organizations task is tdetermine the needs, wants, andinterests of target markets and to

deliver the desired satisfactions moreeffectively and efficiently thancompetitors in a way that preserves o

enhances the consumers and thesocietys well-being


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The Societal Marketing Conce

The societal marketing concept calls upmarketers to build social and ethicalconsiderations into their marketingpractices.

They must balance and juggle the oftenconflicting criteria of company profits,consumer want satisfaction, and publicinterest.


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Old Economy Vs New Econom

Old Economy New EconomyOrganize by product units

Focus on profitable transactions

Looks primarily at financial scorecard

Focus on shareholders

Marketing does the marketingBuilds brands through advertising

Focus on customer acquisition

No customer satisfaction measurements

Overpromise, underdeliver

Organize by customer segments

Focus on customer lifetime value

Look also at marketing scorecard

Focus on stakeholders

Everyone does the marketingBuild brands through performanc

Focus on customer retention

Measure customer satisfaction &retention rate

Underpromise, overdeliver

S li C t R l ti h


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Supplier-Customer Relationsh

Buying

(Traditional Structure)

ExecutivesMarketing

Systems

Sales

Finance

Manufacturing

Supplier Customer

ExecutiveMerchandise

Systems

Buyers

Finance

Warehousing(a)

Executives

Marketing

Systems

Sales

Finance

Manufacturing

Executive

Merchandise

Systems

Buyers

Finance

Warehousing

Supplier Customer

(New Economy Structure)

(b)


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Defining Customer Value

& Satisfaction


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Customer Perceived Value

CPV is the difference between the prospeccustomers evaluation of all the benefits anthe costs of an offering and the perceivedalternatives.


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Total Customer Value

TCV is the perceived monetary of the bundof the economic, functional, and psychologbenefits customers expect from a given maoffering.


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Total Customer Cost

TCC is the bundle of costs customers expeto incur in evaluating, obtaining, using, anddisposing of the given market offering.


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Customer Delivered Value

CustomerDelivered


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Value

Total

Customer

Value

Product

Value

Services

Value

Personnel

Value

Image

Value

Total

Customer

Cost

Monetary

Cost

Time

Cost

Energy

Cost

Psychic

Cost

Hi h P f B i


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High Performance Business

Companies that navigate all these pitfalls to reactheir customer value and satisfaction goals.

Arthur D. Little proposed a model of characteristica high performance business as follow:

Stakeholders

Processes

Resources

Organization


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D i R l ti hi


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Dynamic Relationship

Employee

satisfaction

High growth

& profits

Stockholders

satisfaction

High

effort

High quality

products

Higher

satisfaction

Repeat

business

C t C lt


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Corporate Culture

Its the shared experiences, storie

beliefs, and norms that character

an organization

C t Lif ti V l


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Customer Lifetime Value

Its the case for increasing the customer retention

rate.

CLV describes the present value of the stream offuture profits expected over the customers lifetim

purchases.

The company must subtract from the expectedrevenues the expected costs of attracting, sellingservicing that customer.

C t Lif ti V l


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Cost of an average sales call (includingsalary, commission, benefits, and expenses)

Average number of sales calls to convert anaverage prospect into a customer

Cost of attracting a new customer $

C stomer Lifetime Val e


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Annual customer revenue $5,00Average number of loyal years X 2

Company profit margin .10

Customer lifetime value (CLV) $1,00This company is spending more to attract

new customers than they are worth

Strategic Planning


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Strategic Planning

Strategic planning calls for action in threkey areas:

I. Managing the companys business as aninvestment portfolio

II. Assessing each businesss strength byconsidering the markets growth rate and th

companys position and fit in that market

III. Establish a strategy

Organizational Levels


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Organizational Levels

Corporate level

Division level

Business unit level

Product level

Corporate Level


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Corporate Level

Corporate headquarter is responsible fordesigning a corporate strategic plan to guithe whole enterprise.

It makes decisions on the amount of resou

to allocate to each division, as well as onwhich businesses to start or eliminate.

Division Level


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Division Level

Each division establishes a division plancovering the allocation of funds to eachbusiness unit within the division.

Business Unit Level


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Business Unit Level

Each business unit develops a strategic plto carry that business unit into a profitablefuture.

Product Level


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Product Level

Each product level (product line, brand) wia business unit develops a marketing planachieving its objective in its product marke

Marketing Plan


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Marketing Plan

Strategic marketing plan lays out the targemarkets and the value proposition that willoffered based on an analysis of the bestmarket opportunities.

Tactical marketing plan specifies the marktactics, including product features, promotmerchandising, pricing, sales channels, anservice.

Buying Role


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Buying Role

Initiator: The person who first suggests the idea o

buying the product or service. Influencer: The person whose view or advice

influences the decision. Decider: The person who decides on any compo

of a buying decision: whether to buy, how to buy,

where to buy. Buyer: The person who makes the actual purchas User: The person who consumes or uses the pro

or service.

Buying Behavior


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Buying Behavior

Complex buying

behavior

Dissonance-reducing

buying behavior

Variety seeking

buying behavior

Habitual buying

behavior

Significant differences

between brands

Few differences

between brands

High Involvement Low Involvement

Complex Buying Behavior


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Involves the following steps:

Buyer develops beliefs about the productHe/She develops attitudes about the productHe/She makes a thoughtful choice

Consumers engage in complex buying behaviorswhen they are highly involved in purchase and aw

of significant differences among brands. This is usually the case when the product is

expensive, brought infrequently, risky, and highlyexpressive.



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The marketer must understand consumers

information gathering and evaluation behavior. Marketers need to develop strategies that assist t

buyer in learning about the products attribute andtheir relative importance.

Marketers need to differentiate the brands featuruse print media to describe the brands benefits, motivate sales personnel and the buyersacquaintances to influence the final brand choice

Dissonance Buyer Behavior


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Dissonance Buyer Behavior

Sometimes the consumer is highly involved in a

purchase but sees little difference in brands.

The high involvement is based on the fact that thpurchase is expensive, infrequent, and risky.

If the consumer finds quality differences in the brathey might go for the higher price.

If the consumer finds little difference, they mightsimply buy on price or convenience.

Habitual Buying Behavior


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Habitual Buying Behavior

Many products are bought under conditions of low

involvement and absence of significant brand differenc Consumers have low involvement with most low-cost,frequently purchased products.

For low involvement products, the buying process begiwith brand beliefs formed by passive learning and is foby purchase behavior, which might be followed byevaluation.

Marketers find it effective to use price and sales promoto stimulate product trial.

Variety-Seeking Buying Behavio


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Variety Seeking Buying Behavio

Some buying situations are characterized by low

involvement but significant brand differences. Consumers often do a lot of brand switching (ex. Cook Market leader will try to encourage habitual buying beh

by dominating the shelf space, avoiding out of stockconditions, and sponsoring frequent reminder advertisi

Challenger firm will encourage variety seeking by offerilower prices, deals, coupons, and free samples.

The Outline of Marketing


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Marketing BusinessPhilosophyMarketinTactics

MarketingStrategies

The Outline of Marketing

STP Marketing

SegmentationTargeting

Positioning

Marketing Concept

Customer needsTarget market

Integrated marketing

Profitability

Marketing

ProductPricing

Promotion

Place

Demographic/

economic

Technical/

physical


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Suppliers

environment

p y

environment

Political/

legal

environment

Social/

cultural

environment

Publics

Competitors

Marketingintermediaries

Target

Customer

PriceProduct

Promotion Place


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THE CORE CONCEPTS

The Core Concept


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Want

Need

Demand

Human need is a state of felt deprivation

Needs are not invented by marketingThey are basic part of human make-up

Human wants are the form taken by human needThey shaped by culture and individual personalitWants are expanded when people are exposed

more want-satisfying productsDemands are human wants that are backed by

buying power

The Core Concept


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Good

Service Idea

The Core Concept

Product A product is anything that can be offeredto a market to satisfy a need or want

A product can consist of as many as

three components:Physical goodService, andIdea

The Core Concept


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The Core Concept

Value CostSatisfaction

Value is the satisfaction of customer requirementsat the lowest possible cost of acquisition,

ownership and use

The Core Concept


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The Core Concept

Conditions for exchange potential to existExchange

Is the act of obtaining a desire product from

someone by offering something in return

At least two parties Each party has something of value to the other party

Capable of communication and delivery

Free to accept or reject the exchange offer

Desirable to deal with the other party

The Core Concept


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A MARKET consists of all the potential

customers sharing a particular need or wantwho might be willing and able to engage inexchange to satisfy that need or want

Industry(a collection

of sellers)

Market(a collection

of buyers)

Information

Communication

Money

Goods / services


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The Places of MarketingWithin an Organization

Marketing As an Equal Function


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Marketing As an Equal Function

Production Finance

Marketing HumanResources

Marketing As a More Important Functio


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Marketing As a More Important Functio

Production Finance

Marketing

Human

Resources

Marketing As the Major Function


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Marketing As the Major Function

Human Resources

Marketing

The Customer AsTh C t lli F ti


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Human Resources

Marketing

The Controlling Function

P

roduction

Financ

e

Customer

The Consumer As the Controlling Function andMarketing As the Integrative Function


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Marketing As the Integrative Function

Human Resources

Customer

Marketing


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MARKETING IN THE NEWECONOMY

The New Economy


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e e co o y

A substantial increase in the buying power

A greater variety of available goods andservices

A great amount of information about particulaanything

A greater ease in interacting and placing andreceiving orders

Ability to compare notes on products andservices

Impact of Information Technolo


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1. Transportation and Communication havebecome faster and cheaper

GLOBALISATION

GLOBALISATION


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More competition

Consumer behavior

Different competitive st

Higher level of compet

Transparancy & inform

Larger action radius

ar e ng oo s n e eEconomy


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y

Brand

PRODUCTPRICE

(Yield)

Acquisition

Retention Logistics

DatabaseManagementResearch

ACCESS

The Definition of Product


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A product is an idea, a service, a good o

any combination of them It is everything one receives in an

exchange: a complexity oftangible and

intangible attributes including functional utilities social utilities and psychological utilities Bundle of


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Total Product Concept


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AUGMENTED PRODUCT

ACTUAL PRODUCT

CORE PRODUCT

Corebenefit

Packaging

Brand

name

Features

Quality

level

Styling

Installation

Warranty Credit

After-sale service

Delivery

The total product concept: example tooth paste


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CLEAN

TEETH

TOTAL PRODUCT

AUGMENTED

PRODUCT

romance money saved

on dental bills

brand name

size

flavor

color

packaging

fresh breathsafety

white teeth

social

confidence pleasa

taste

What Is A Brand?


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A name, term, sign, symbol, ordesign, or a combination of theseintended to identify the goods orservices of one seller or group of

sellers and to differentiate themfrom those of competitors

Brand Equity


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The value of a brand, based on theextent to which it has high brand loyalname awareness, perceived quality,strong brand associations, and other

assets such as patents, trademarks anchannel relationship

Brand Equity Based on Awareneand Preference


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Brand

awareness

Brand

acceptability

Brand

preference

Brand

unawareness

Bra

loya

Brandval

ue

Characteristics of a Good Brand NamS


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Short and simple

Easy to spell and read

Easy to recognize and remember

Pleasing when read or heard--and easy to pronoun

Pronounceable in only one way

Pronounceable in all languages (for goods exporte

Always timely (does not get out of date)

Legally for use (not in use by another firm)

Not offensive, obscene, or negative

Suggestive of product benefits


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COMMUNICATIONSTRATEGY

Definition Of Promotion


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Communication withpotential buyers about anitems existence and uses

with the objective of

changing orconfirming their behaviorin order to stimulate sales

There is nothing wrong withproducing ads that people in yo


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p g p p y

company like. In fact, it is nice

they do. It is good for compan

morale. But the people inside

your company are not the targmarketSergio Zyman

The Aya Cola

Tasks of communications


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Tell consumers where they can buy

Get consumers to trade up to more expensiveproducts

Alert consumers of sales

Justify the price of a product or service Answer questions

Close transactions

Provide after sale service

The Communication Proce


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Sender Encoding DecodingMessage Re

Feedback

Noise

Response

Media

ENCODING


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We keep your promises DHL

Make sure home knows where your heartGSM PTT

World currency American Express

World proof Samsonite Lets make things better Philips

Communication Goals


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ADVERTISMENTS ARE EXPECTED TO:

generate attention

be understood

be believed

be remembered

THE PROMOTION MIX


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ADVERTISING PERSONAL

SELLING

SALES PUBLICITY

PROMOTION PUBLIC

RELATIONS

Communication Mix Advertising any paid form of nonpersonal present


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Advertising-- any paid form of nonpersonal presentand promotion of ideas, goods, and services by an

identified sponsor Sales promotion-- short term incentives to encoura

purchase of a product or service

Publicity-- Nonpersonal stimulation of demand for a

product or service by planting commercially significantabout in in some type of media

Personal selling-- face-to-face interaction betweencustomer and sales person with the purpose of makingsale

Common Communication Tool


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Common Communication ToolAdvertising

Print ads Broadcast ads Packaging Mailings Catalogs

Brochures Billboards Point-of-sale

displays

Sales Promotion

Contests& Games Premiums Samples Exhibits Coupons

Rebates Low Interest Financing Trade in allowance

Publicity

Press kits Speeches Seminars Annual reports Charitable

donations Public

relations

Personal

Salespresent

Salesmeeting

Tele-ma Trade sh

Steps in DevelopingEffective Communication


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1. Identifying and analyzing the target

audience2. Determining communication objectives3. Designing the message4. Selecting the communication channel

5. Establishing the total promotional budget6. Deciding on the promotional mix7. Measuring promotional results

Determining communicationobjectives


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Why do marketers go to work every day a

launch hundred million dollar campaignswithout having clearly figured out what res

they are hoping to achieve

Sergio ZymanThe Aya Cola

Strengths and Weaknesses of major kinds of meMEDIA

Maybe expensive

FlexibleNewspaper

WeaknesseStrengths


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Expensive in totalClutterShort exposureLess selective audi

Offers sight, sound,and motion

Good attentionWide reach

Television

Maybe expensiveShort lifeNo pass-along

FlexibleTimelyLocal market

Newspaper

Offers audio only

Weak attentionShort exposure

Wide reachSegmented audiencesInexpensive

Radio

InflexibleLong lead time

Very segmented audiencesCredible sourceGood reproductionLong life

Good pass-along

Magazine

The question is not how man


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q

promotions can we buy, buinstead how many more sale

can we get

Sergio ZymanThe Aya Cola

Example of objective and task metho Want 8% of market --100,000 total means 8,000 customers nee


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Hope to reach 50% of the market

40% of people who try the product will become regular users. N8,000 regular users, therefore must get 20,000 people to try theproduct ( 20% trial rate)

Advertiser estimates that 10 exposures for every 1% of the popuwould bring about trial rate of 20%.

A Gross rating point is one exposure to 1% of the target populatSince it is desired to achieve 10 exposures to 50% of the populait will need to buy 500 GRPs

If an average GRP costs $2,500, the budget must be set at$1,250,000

Relative Spending on Promotional Tools inConsumer Versus Business Markets


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Relative spending

Sales promotion

Advertising

Personal selling

Personalselling

Sales promotion

Advertising

PRPR

Consumer goods Industrial goods

Relative spending

Cost Effectiveness of Different Promotional Tat Different Buyer Readiness Stages

eness


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Awareness Comprehension Conviction Ordering Reord

Salespromotion

Personal

selling

Advertisingand publicity

Promotionalcosteff

ective

Stages of buyer readiness

Cost Effectiveness of Different Promotional ToolDifferent Stages of the Product Life Cycle

eness


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Salespromotion

Advertisingand publicity

Personalselling

Introduction Growth Maturity Decline

Stages of product life cycle

Promo

tionalcosteffective


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Product Mix Strategies

Classification Of Consumer Good

CONVENIENCE GOOD Bought frequently a


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CONVENIENCE GOOD

SHOPPING GOODS

SPECIALTY GOODS

Bought frequently awith minimum buyineffort

Brand loyalty, producomparison, monetsocial risks

Seldom purchased,substitutes accepteinformation search


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MARKET POSITIONING

What Is Market Positioning?


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Arranging for product to occupy a clear,distinctive, and desirable place relative tocompeting products in the minds of targetconsumers

Formulating competitive positioning for aproduct and a detailed marketing mix.

Touch of class

Car to be proud of

Distinctive*Mercedes

*Lincoln*Porsche

*BMW


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Spiritedmance,

people,

drive

Very practical

Good gas mileage

Affordable

Conservative*Cadilac

Appeals to older*Oldsmobilepeople

*BMW

*Ford

*Pontiac

*Buick*Dodge

*Plymouth *Hyundai *Isuzu

*Chevrolet

*Toyota

*VW

A PRODUCTS POSITION IS THE CUSTOMERS PERCEPTIO

OF THE BRAND IN RELATION TO COMPETITIVE OFFERS

PRODUCT LIFE CYCLE (PLC

I t d ti G th M t it Decline


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Introductionstage

Growthstage

Maturitystage

Declinestage

Time

Revenue

Industryprofits

Industrysales

Product Life Cycle

$)


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Time

Introduction Growth Maturity Dec

Sales

Profit

Salesandprofits($

Industry, Product Line and BraLifecycles

Sales

Computer


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T

Computer

industry

lifecycle IBM prodline lifec

IBM1401 IBM120 IBM130 IBM1135&145 IBM1158


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MARKETING PLANNING

Marketing Management Tasks

Identifying target markets


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Identifying target markets

Marketing research Product development

Marketing mix

Monitoring

Marketing Plan

A written statement of marketing objective


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A written statement of marketing objective

strategies and specific courses of action totaken when (or if) future events occur. Itincludes the marketing mix, personnelresponsibilities, a budget and a timetable


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You dont want your airline pil

deciding before he takes off th


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deciding before he takes off th

he is going to fly over Omaha athen sticking to his plan when th

thunderstorms roll inSergio Zyman

The Aya Cola

MARKETING PLAN

MISSION D l ti f k t d fi iti


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MISSION Declaration of market definition

Revlon: We sell hope

OBJECTIVE Increase profit

Capture new markets

Introduce new products , etc.

STRATEGY What to do to achieve objectives

(use of 4 Ps)

TACTICS How to carry out these measures

Timin - media choice etc.

SWOT Analysis


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Strengths Weaknesses

Opportunities Threats

Check Feasibility

Costs


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Costs

Feasibility

Results

Market Reaction

The discipline of marketing is

science and spending on


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science and spending on

marketing is an investment thapays returns. Marketing must b

measured. It needs to be

accounted for.Sergio Zyman

The Aya Cola


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The Internal Environment

TWO DETERMINANTS OF PROFITABILIT

Advantage

etitive

n


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Disadvantage

Low High

Compe

Posit

ion

Environmental Attractivenes

Product Portfolio

MARKET


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MARKET

GROWTH

MARKET SHARE

STARS QUESTIONMARKS

MILK COWS DOGS

Tomorrows breadwinner Developments

Sleepers

Ego trips


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?

Todays breadwinner Yesterdays breadwinners

Failures

Balanced Portfolio


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market sharehigh

Unbalanced Portfolio


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market sharehigh


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marketing 4 non marketing

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