tongil marketing (education material 2)

Industries Company Co., Ltd.

Precision, Persistence, Performance

Marketing (Education Material #2)

1. Branding Methods

Following global competition and diversity of products, there are various types of brandingstrategies, brand portfolio and mix accordingly. It would be difficult to pin-point out all those variousbranding methods, however, in general, branding can be broadly categorized under three methods.

Corporate branding

Using company' s name as the product name. Also called Family branding (ex. Samsung) Company values stretch throughout and reflected in all products. Customer expect every product with the same brand name to have the same level of

quality that they are familiar with.

Product branding

A different brand name for all products. The product stands alone with unique values. Most often, the corporate name is not promoted and recognizable to the consumer. Consumer expects unique quality from each different product.

Co-branding

Arrangement between two entities or companies to associate product qualities, brand,logos into a single product or service.

Associating a product with someone other than the principal producer.

(ex. Dell computers/Intel processors)

(ex. DMG/Mori Seiki)



2. Brand Value

What is brand value? This question can be comprehensively answered simply reflecting upon oneof your past experiences in making an important purchase. What were the main factors, or expectedvalue, to come to a final decision on a purchase? In general, the main questions one would ask are"Does this work right for my sought purpose? Does this make me look good? Do I feel attracted to this?Is this worth it?" In other words...

Functionality

Quality and performance of the product. This factor puts more weight in factors such as tech spec. and convenience.

Social Status

Level of satisfaction for one's belonging needs. Reflection of self-esteem.

Emotional

Design: Matches your style and taste. Psychological: Reflects your self-image. Preconception: Sometimes you know one product is better than the other, but without

reason, you just don't "like it".

Financial

In reality, you can not always purchase what you want due to financial situations. You may not be able to get the best but consider the level of satisfaction of the above

three factors for the money you are willing to pay.

Summary:

Based on your Selection of Priority Target Market, think of what branding method your companyseeks to apply. What our the needs and expectations of your target? How shall you customize, change,or upgrade an existing product, or develop an entirely new product and brand awareness to satisfy suchbrand values above? The next step would be to do an in-depth market research of your Priority TargetMarket. This includes market segmentation, 4P (Product, Price, Place, Promotion) analysis or actually itis now 7P (Product, Price, Place, Promotion, People, Process, Physical Evidence), situation analysis(5C, PESTLE, SWOT analysis). As previously discussed during the first session, there is no need tocomplete a full academic market research report. Start from brain-storming and sort out which factorsand points in your market research are most important and crucial in building your brand and brandingstrategy. The rest is an on-going process. You may follow the text-book if you like, but it may takeforever and the market does not wait.



Reference - 4P analysis chart

Category Subcategory Existing productsExisting markets

New productsExisting markets

Existing productsNew markets

New productNew markets

Product 1) Expansion2) Modification3) Deletion4) Consolidation5) Standardize design6) Positioning7) Change mix8) Branding9) Packaging

Price 1) Change price,terms or conditions

2) Skimming policies3) Penetration policies

Place 1) Expand, modify,delete,consolidation,standardize delivery,distribution, service,channels.

Promotion 1) Advertising2) Sales force3) Sales promotion4) Public relations5) Exhibitions6) Direct mail

Source: Strategic marketing planning (Malcolm McDonald)

Reference - Market segmentation variables

Geographic- Region: world, country, region- Country size: metropolitan cities, small cities, towns- Density of Area: Urban, semi-urban, rural

Demographic

- Age, Gender- Family size, Family life cycle- Education, Income- Socioeconomic status- Nationality, Language

Psychographic - Personality, Lifestyle- Value, Attitude

Behavioral- Benefit sought, End use- Product usage rate, Readiness-to-buy stage- Brand loyalty, Profitability

Technological- Motivations, Usage patterns- Attitudes about technology- Fundamental values, Standard of living- Profit is there in business from the existing clients



Reference - Situation analysis (5C, PESTLE, SWOT)

Category DetailsCompany - Product line

- Image in the market- Technology and experience- Culture- Goals

Collaborators - Distributors- Suppliers- Alliances

Customers - Market size and growth- Market segments- Benefits that consumer is seeking- Motivation behind purchase; value drivers, benefits vs.costs- Decision maker or decision-making unit- Retail channel; where does the consumer actually purchase the product?- Consumer information sources; where does the customer obtain information aboutthe product?- Buying process; e.g. impulse or careful comparison- Frequency of purchase, seasonal factors- Quantity purchased at a time- Trends; how consumer needs and preferences change over time

Competitors - Actual or potential- Direct or indirect- Products- Positioning- Market shares- Strengths and weaknesses of competitors

Climate(or context)

PESTLE Analysis- Political and regulatory environment- Economic environment- Social/Cultural environment- Technological environment- Legal environment- Ecological environment



Real example.

This is a TONGIL universal cylindrical grinding machine. Let's take a look at its values.

www.tongil-industries.com

Functionality

Roundness: 0.001 mm Cylindricity: 0.003 mm

- From an technical perspective, your product performs with excellent quality. Good.- You have the scientific data & user records. So what is pulling you back?- Whether it is a spec sheet, application case sheet, brochure etc. there is need to improveyour documents in a form designed for the purpose to build an impressionamong your potential prospects using more effective communicative means.

- We are in the era of knowledge society. People seek more knowledge. Share whatinformation you have in a public-friendly way.

Social Status

Products manufactured based on higher than JIS standards. OEM for Hyundai-Wia and a Japanese machine tool company. More than 70% market share among domestic competitors.

- A leading player with verified quality grinding machine products. Good.- So what is the situation? The TONGIL brand is not known in oversea markets.- Think how to promote and strengthen recognition and awareness.



Emotional

Most of the domestic buyers purchase without much thought, given that the domesticmarket commonly knows and recognizes TONGIL grinding machines as "TheStandard".

In this sense, TONGIL grinding machines are still recognized as "excellent" but not"AWESOME" as back when they started gaining substantial market share in Korea.

Therefore, not much effort had been put in the fields of design, color, brand image,promotion etc.

- Think of an "AWESOME" design, color, brand image so domestic users can feelmore "Privilege and Premium".

- Think of how to build further awareness in oversea markets, so to speak, that theproduct quality is good as a "Made in Japan" and "Designed in Europe".

- The image below is a small start. Still needs a lot of work.

Before After

Financial

Price: Thought to be a dilemma or disadvantage for most Korean companies. Less expensive than Japanese but more expensive than Chinese products.

- Actually, it is an advantage. Quality as good but less expensive than Japanese.- Get the word out. However, the process of proving and building awarenessamong end-users is critical.

- They need to know this benefit by fact and experience + "like" your product.

Now you, TIC as a whole company, need to go through a process for Selection of Priority TargetMarket. This should be rooted in and cohere with your company's grand strategy to promote theselected brand. Selection of the priority target market can cause impact upon further or following sales,marketing, promotion tactics and campaigns, thereby this process should be thought thoroughly andcautiously in detail. This will be your first impression in the market.



2. Brand Positioning

You have decided the values and intended image of your brand and you try to make an impressionon a potential customer. However, most of the time it is interpreted differently than intended. Wefrequently see people saying "That wasn't my intension", "I think you are misunderstanding". Wrong.Most of the time, you are the one not fully clear of one's own intension (attributes), don't know what youare talking about: lack of communication skills (inconsistent/inappropriate message & slogan), and notgenerous enough to explain twice (not repetitive). The goal and what is most important for the companyis to get the intended impression registered in the customer's mind.

Clarify your intension

In other words, what are the differentiated attributes of your product. The persona. Surround your brand centering on one or a few main attributes. People cannot perceive and register many attributes at once.

Know what you are talking about

Be sure that the message & slogan associates with and reflects the attributes of yourproduct.

Is the message & slogan consistently and properly conveyed via all of yourestablished communication means?

Explaining once is not enough

What matters is to get the intended impression registered in the customer's mind. Be repetitive and frequently convey your message & slogan until you and your

customer are on the same page. In order to be a special "someone" or "something" in the mind of your customers', you

have to create intimacy, in other words stay close to your customers.

Conclusion:

Now, we have written down the TONGIL products brand values. The next step is toassociate each one with a unique attribute of your product which you intend to get registered inthe mind of your customers'. Unless you have an established message already, normally amessage should be defined based on the attributes. The slogan should be clear and conciseyet show some kind of implication that associates with the message and the attributes. The goalis to guide the customers to use their imagination to naturally form and perceive the intendedmessage of their own accord based on the factual information of your attributes andslogan/catch phrase.



Real example.

This is a TONGIL universal cylindrical grinding machine. Let's take a look at its association amongits values, attributes, message, and slogan.

Values Attributes

Functionality - Precision: less than 3 micron- Customizable based on customer-need.

Social Status- 70% market share among domestic competitors.- Manufactured based on higher standards than JIS.- OEM for renown Japanese grinding machine company imported intothe Japanese market.

Emotional - European concept in design and coloring

Financial - Quality good as Japanese yet price is less expensive.



Attributes (shortened) Message Slogan/Catch Phrase

- Less than 3 micron- Customizable

Quality excellence.Customer intimacy. Tentative Slogan:

PrecisionPersistence

Performance

Tentative Catch Phrase:

A Single Discipline ofConsistency

- 70% share- Higher than JIS.- OEM, imported into Japan.

Product Leadership.

- European design Advanced.

- Less expensive Premium deal.

Now that we have written down the attributes, message and slogan/catch phrase let's try toconnect the dots. Do you see a connection? Use your imagination and try to visualize any picture orimage in color you can associate with the attributes, message and slogan/catch phrase above. Eachone of you would have a different visualization and it necessarily may not be aligned with the intendedimage. That is not a problem. As long as the images are positive and attractive, that is a good start. Aspreviously explained it is crucial to be repetitive until the intended image gets registered in the minds ofexisting, new, potential customers, and even those who have nothing to do with this industry. They mighthave friends who do. In order to get the intended image and perceived image aligned is where yourmarketing/online marketing matrix plays an important role. Take a look at the comparison below. Initially,as a first step, we want to shift from the left to the right. It may be not perfect and incremental ,continuous improvement of your brand and image is necessary. It is your communication means and thecommunicative process to align this gap via marketing campaigns and other efforts.

Compare:

A Single Discipline of Consistency A Single Discipline of Consistency

Precision, Persistence, Performance Precision, Persistence, Performance



"A Single Discipline of Consistency"


tongil marketing (education material 2)

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