Download strategic marketing summary and key concepts

ELBAKKALIYoussef
STRATEGICMARKETING
SUMMARYANDKEYCONCEPTS
ELBAKKALIYoussef
2015-2016
ELBAKKALIYoussef
CH2FROMCOMPANYSTRATEGYTOMARKETINGSTRATEGY
Marketingstrategyrequiresverticalandhorizontalalignementwiththeotherdepartements
èIT’SNOTASINGLEDEPARTMENT!!
ISTHEREAGOODMARKETINGSTRATEGY?Nostrategyisthebestforallcompanies
2.1COMPANYSTRATEGY
It’stheoverallscopeanddirectiontoachievespecificgoals
Thenatureofthecompanyadvantagedeterminesthecompanystratagy(Example:
MerecedesàTechnology;Aldi/RyanairàCost)
à3CHARACTERISTICS
• ItisaVISIONèHowweseethemarket
• ItisdevelopedagainstacompetitorèNotinisolation
• ItislongtermorientedèYouonlychangewhennecessary
à3LEVELS
• Group/corporatelevel(allmarkets,…)
• Strategicbusinessunitlevel(food/nonfood…)
• Functionorcenterofexcellence(R&D,engineering…)
- Singlebusinessthatcanbeplannedseparately
- Ithasitsownsetofcompetitors
- Ithasamanagerresponsibleforitsstrategy
- à2TYPESOFSTRATEGYACCORDINGTOPORTER
Costadvantage(Ryanair)><Differentiation(Audi…)
2.2STRATEGICPLANPROCESS
àVISION:Whatthecompanywantstobe,theirvisionoftheworld.Mustbeinspirational
àMISSION:Thefundamentalpurposeofanorganisation.Whyitexistsandwhatitdoesto
achieveitsmission.Missionstatementsare“theimpossibledream”thatacompanywants
toreach
AGOODMISSIONSTATEMENTHAS5CHARACTERISTICS
1. Thefocusonalimitednumberofgoals
2. Theystressthecompany’smajorpoliciesandvalues
3. Theydefinethemajorcompetitivespereswithinthecompanywilloperate
4. Theytakealongtermview
5. Theyareasshort,memorableandmeaningfulaspossible
COMPANYCULTUREisveryhardtochange(BMW,DHL…)
ELBAKKALIYoussef
CHAPTER3MARKETANALYSIS
Makingmarketingdecisionsinafast-changingworldisbothanartandascience.
2.1External&Internalanalysis
2.1.1Externalanalysis
MICROENVIRONMENT
Theactorsclosetothecompanythataffectitsabiltytoserveitscutsomers,thesuppliers,
marketingintermediaires,customermarkets,competitorsandpublics.
èTHECOMPANY:Wetakeintoaccountgroupsinsidethecompany.Suchastop
management,finance,R&D,…Themarketingdepartementhastoworkwiththeother
departementsofthecompany.EXAMPLE:Aldi’smarketerscan’tpromiselowpricesunless
itsoperations/purchasingdept.
èTHESUPPLIERS:Suppliersareveryimportantbecausetheyprovideressourcesneededby
thecompanytoproducegoods.Therelationwiththesuppliersaffectsdirectlythefinal
productandthemarketing.EXAMPLE:ActivesuspensionBMW…
èINTERMEDIAIRES:Firmsthathelpthecompanytopromote,sell,anddistributeitsgoods
tofinalbuyers.Example:McDonaldssellsCocaCola
èCOMPETITORS:Marketershavetofocusnotonlyoncustomersbutalsooncompetitors.
èPUBLICS:Anygroupwhocanhelpthecompanytoachieveitsobjectives.Forexample:
FinancialPublics,MediaPublics,Governmentpublics,Citizen-actionpublicsetc
èCUSTOMERS:ThecompanycantargetanyorallofcustomermarketssuchasConsumer
Markets,Businessmarkets,Resellermarkets,GovernmentmarketsorInternationalmarkets.
MACROENVIRONMENT
èDEMOGRAPHICENVIRONMENT:
• BabyBoomers19461964
• GenerationX19651976
• Millennials19772000
èECONOMIC
• Changesintheeconomyaffectthewaythatpeoplebuy
• Incomedistribution:wehavetotargetthegoodsocialclassdependingonhisincome
ELBAKKALIYoussef
èNATURAL
• Thegrowingshortagesofrawmaterialssuchaswater
• IncreasedpollutionèTheinfluenceofenvironmentalgroupswillincrease
èTECHNOLOGICAL
• Newtechnologiesofferalotofopportunitiesformarketers
èPOLITICAL
• Thelegislationaroundbusinesshasbeenincreasingduringthelastyears
• 3goals:Protectcompaniesfromunfaircompetition,protectconsumerandprotect
theinterestsofsociety
• Afairmarketispercievedasgoodbycompanies
• IncreasedemphasisonEthicsandRSEforexampleonInternetwiththelegislation
aroundprivacy
èCULTURAL
• Forcesthataffectsociety’sbasicvalues
• Themajorculturalvaluesofasocietyareexpressedinpeople’sviewsofthemselves
andothers
CONCLUSION
“Therearethreekindsofcompanies:thosewhomakethingshappen,thosewhowatch
thingshappen,andthosewhowonderwhat’shappened.”Butpayattention,theyarethings
thatyoucan’tchangesuchasgeographicpopulationshiftsetc
2.1.2Internalanalysisormarketintelligencesystem(MIS)
MISsupplieshappeningsdataèdistributeaccurateinformationtomarketingdecision
makers.Theyarealotofwaystocollectdata(Purchaseinformation,ontheinternet…)
2.2Interpretationoftheresults
2.2.1SWOTAnalysis
Internalelements=Strengths–Weaknesses
Externalelements=Opportunities-Threats
èThegoalistomatchthecompany’sstrengthstoattractiveopportunitieswhile
eliminatingtheweaknessesandminimizingthethreats.
Corecompetency
Inthepast,companieswhereusedtoownalltheresourcesoftheirbusiness.Buttodaythey
wecanobtainbetterqualityorlowercost
1) Itisasourceofcompetitiveadvantage
2) Ithasapplicationsinawidevarietyofmarkets
3) Itisdifficultforcompetitorstoimitate
ELBAKKALIYoussef
Opportunities
1) Tooffersomethingthatisinshortsupply
2) Tosupplyanexistingproductorserviceinaneworsuperiorway
3) Atotallynewproductorservice
Threats
Notallthethreatsarethesame.Themanagerhastoprepareaplaninadvancetomeet
them.
Strenghts/WeaknessesChecklist
Acompanycanmakeachecklistforstrenghts/weakenesses
2.2.2BCGMatrix
Ithelpscompaniestoanalyzeproductlineinsearchofgrowthopportunities
PortfoliomanagementèTheprocessbywichmanagementevaluatestheproductsand
businessesthatmakeupthecompany.Thecompanywillputmoremoneyinthemost
profitableprojects,theywilltrytoidentifythekeybusinessesofthecompanycalled
StrategicBusinessUnits.
Moststandardportfoliosanalaysisevaluatetwothings:theattractivenessofSBU’smarket
andthestrengthoftheSBU’spositioninthatmarket
Growth-sharematrix(matriceBCG)
• StarsàHighgrowhighshareproducts,theyneedhighinvestments.Starscan
becomecashcowsiftheysustaintheirsuccess
• CashCowsàLowgrowhighshareproducts,theyarewellestablishedinthemarket
andneedlowerinvestments.Theyaretheleadersinthemarketplace
• QuestionmarksàHighgrowmarketslowshareproducts,theyrequirealotof
moneytoholdtheirshare.
• DogsàLowgrowth,lowshareproductsàthedon’tpromisesourcesofcash
Thecirclesinthematrix:
Thecompanywantstoinvestinthemorepromisingquestionmarkstomakethembecome
stars,andalsomantainthestarssothattheywillbecomecashcows.
Thecompanyhasalso2cashcowswhofinancethestars,thequestionmarksandthedogs.
ELBAKKALIYoussef
4StrategiesderivedfromtheBCGmatrix
OncethecompanyhasidentifieditsStrategicBusinessUnits(SBU’s),thecompanycan
pursueoneofthe4strategiesforeachSBU
1) Itcaninestmoreinthebusinessunittobuilditsshare
2) ItcaninvestjustenoughtoholdtheSBUatthecurrentlevel
3) Itcanharvest(récolter)theSBU,milkingitsshort-termcashflow
4) ItcanselltheSBU
2.2.3TheGEgrid
TheGE/Matricmeasuresproductsaccordingtobusiness-unitstrengthandindustry
attractiveness.
CONCLUSION:
àTheBCGmatrixclassifiescurrentbusinessesbutprovideslittleadviceforfutureplanning.
Itcanalsobedifficulttoimplementbythemanagament.
àTodaythestrategic-planningisinthehandsofdivisionalmanagerswhoareclosetotheir
markets
2.2.4Porter’s5forcesmodel
Modelusedtoidentifywethernewproducts,servicesorbusinessescanbeprofitable
1. BargainingpowerofSUPPLIERSàHereyouevaluatehoweasyitisforsuppliersto
increaseprices.Thelesssuppliersyouhave,thefewerchoiceyouhave,thereisthen
adependenceofsuppliers(theyaremorepowerful)
2. RivalryamongEXISTINGFIRMSàWhatisimportanthereisthenumbernumberof
competitorsandtheircapability
3. ThreatofPOTENTIALENTRANTSàTheabilityofpeopletoenteryourmarket.Thisis
affectedbytime/moneytoenter,economiesofscale,keytechnologies,barriers…A
strongpositionallowsyoutopreserveafavorableposition
4. ThreatofSUBSTITUTIONàTheabilityofcustomertofindadifferentwayofdoing
whatyoudo(copyoftheprocesscanweakenyourposition
5. BargainingpowerofBUYERSàhowitiseasyforbuyertodrivespricesdown
ELBAKKALIYoussef
CH4COMPETITIVESTRATEGIESANDGOALFORMULATION
3.1Developingcompetitivestrategies
Companieshavetofindbusinessestoconsiderinthefuture.Theyneedgrowthtosatisfy
stakeholdersandattracttoptalent.Thecompany’sobjectivehastobe‘profitablegrowth’
andnotsimplygrowth.
DEFINITIONS
• CompetitiveadvantageàOfferingconsumersmorevalueandsatisfactionthan
competitorsdo
• CompetitoranalysisàTheprocessofidentifiying,assessingandselectingkey
competitors.
• CompetitivemarketingstrategiesàStronglypositionagainstcompetitorsandgive
thecompanythestrongestpossiblestrategicadvantage.
MARKETPOSITIONING
• MarketleaderàThefirminanindustrywiththelargestmarketshare(exProximus)
• MarketchallengeràArunner-upfirmfightinghardtoincreaseitsmarketshare(ex
Base,Mobistar)
• MarketfolloweràArunner-upfirmthatwantstoholditsshareinanindustry
(Telenet)
• MarketnicheràAfirmthatservssmallsegmetntsthattheotherfirmsinanindustry
overlookorignore(JimMobile)
Nostrategyisbestforallcompanies,eachcompanymustdeterminewhatesmakesmost
sense.
3.1.1Marketingleaderstrategies
Theleaderhasthelargestmarketsharesandusuallyotherfirmsfocusontheleaderasa
companytochallenge,imitateoravoid.Toremainnumberone,leadingcompaniescantake
anyofthreeactions
1) Expandingtotaldemand(Danone)
Theycanfindnewusers(menforexample),developnewuses(livrederecette)and
encouragemoreusageofitsproducts(Roycosoups).
2) Protectingmarketshare
Theleadermustpreventorfixtheweaknessesthatprovideopportunitiestoits
competitors.
Theleadermustkeepstrongrelationshipswithcustomers,pricesmustremain
consistent.
ELBAKKALIYoussef
ThebestdefenseisOFFENSEèTheleadershouldbetheleaderintheindustry,new
products…
3) Expandingmarketshares
Insomemarketsasmallmarketsharerepresentsalotofsales.Profitabiltyriseswith
increasingmarketshare.Butnotalways,highersharestendtoproducehigher
returnsonlywhenunitcostswithincreased,orwhenthecompanyoffershigher
qualityathigherprice.
3.1.2Marketchallengerstrategies
Companiesthataresecond,thirdorlowercanchallengethemarketleader.
Achallengermustdefinewichcompetitorstochallenge,itcanattacktheleaderàahigh
riskbuthighgainstrategy.Oritcansimplytrytogetthemoremarketshare.
• Challengersbecomeleadersbyimitatingandimprovingtheideasofthepioneering
leader.(Chryslerhadthefirstminivan,butthenToyotaimproveditandbecamethe
marketleader)
• Youcanavoidtheleaderandtargetsmallplayers(likeinthebeermarket)
• Thechallengercanalsomakeafullfrontalattackbytargetingthecompetitor’s
strengths(CocaColavsPepsi)
• Finally,thechallengercanmakeanindirectattackagainsttheleader.SuchasRed
Bullwhostartedinunconventionaloutletssuchasnightclubs.Nowtheyselltheir
softdrinkwithhighmargins.(YoupaytwiceforaRedBull)
3.1.3Marketfollowersstrategy
Notallthecompanieswanttochallengetheleader,becausehecanquicklymatchtodefuse
theattack.Manycompaniesdecidetofollow.Thefollowercanlearnformleader’s
experience(successandfailure),itcanalsocopyorimprovetheleader’sproductswithmuch
lessinvestmentand,finally,thefollowercancompetewithlessrisksandinvestments.
3.1.4Marketnicherstrategies
Firmswithlowsharescanbehighlysuccessfulandprofitablethroughsmartniching.
Itisveryprofitablebecausetheyknowverywellthecustomer.Nicherstrytofindoneor
moremarketthataresafeandprofitable&servesspecificcustomerneedsbetterthanany
one.Thenichemarketshavenointerestformajorcompetitors.
DEVELOPINGSTRATEGIESFORGROWTHèProduct/marketexpansiongrid
ELBAKKALIYoussef
PRODUCT/MARKETGROWTHMATRIX
MarketpenetrationèGrowthby
increasingsalesofcurrentproductsin
currentmarkets,withoutchangingthe
product(retentionofexisting
customers&geographical)
MarketdevelopmentèGrowthby
developpingnewmarketsegment
marketsforcurrentcompanyproducts
(newcustomers)
ProductdevelopmentèGrowthwitha
newproductoncurrentmarket
segments(morerevenupercustomer)
DiversificationèGrowthwithstarting
abusinessoutsidethecompany’s
productsandmarkets(newrevenues)
BLUEOCEANSTRATEGY
Thebooksuggeststhatanorganizationshouldcreatenewdemandeinanuncontested
marketorspace,ratherthanhead-to-headcompetition
RedOceansèTheexistingindustriestoday,therulesofthegameareknowbyall
(competition).Companiestrytowinagainsttheirrivals.Themarketplaceiscrowdedand
theprospectsofgrowtharereduced.
BlueOceansèTheindustrieswhodon’texisttoday,theunkownmarketplacedwhere
thereisnocompetition.Youhavenottofightfordemand,youcreateit.Itisthewider,
deeperpotentialofmarketspacethatisnotyetexplored.
ELBAKKALIYoussef
BLUEOCEANSTRATEGYEXAMPLE
Amazon,CirqueduSoleil,Apple,Viagra
WiththecreationofViagra,Pfizercreatedablueoceaninlifestyledrugs.
3.2GoalFormulation
OncetheSWOTanalysisisfinished,wecanproceedtoagoalformulation.Mostcompanies
pursueamixofobjectives(salesgrowth,marketshare,innovation..)
Thebusinessunitssetstheseobjectivesandthemanagesbyobjective(MBO)
ForanMBOsystemtowork,theyare4criteria,objectivemustbe:
1. Hierarchy,fromthemosttoleastimportantèForexample,thegoalcanbean
increaseoftheROI,butwecanalsoimproveotherthingsduringtheprocess
2. QuantitativeèItisbettertosayIwanttoincreaseROIto15percent
3. RealisticèTheyshouldarisefromanalysisandnotfromthninking
4. ConsistentèIt’snotpossibletomaximisesalesandprofitssimultaneously.Shorttermprofitversuslong-termgrowth,deeppenetrationofexistingmarketsversus
developmentofnewmarkets…
ELBAKKALIYoussef
CHAPTER5.SEGMENTATION
Wichcustomerswillweserve?Tryingallcustomerscanmeanservingnonofthem.
Companieshavetoservetherightconsumertherightway(consumer-centricity)
Companiesmustidentifythepartsofthemarketsitcanserveandmostprofitably.Must
companieshavemovedfrommassmarketingtotargetmarketing.Firmsarefocusingonthe
buyerswhohaveagreaterinterestinthecompany.
THESTPTRIO(SEGMENTATION,TARGETING,POSITIONING)
Targetmarketingrequires:
1) MarketsegmentationèIdentifydistinctgroupsofbuyers
2) MarkettargetingèSelectoneoremoremarketstoenter
3) MarketpositioningèComunicatethedistinctivebenefitthatthecompanycanoffer
Customersinanymarketshavedifferentwants.Throughsegmentationcomapaniesdivide
themarketintosmallerpartsthatcanbereachedmoreefficiently.
DEFINITIONS
MarketsegmentationèDividingamarketintosmallersegments
MarkettargetingèSelectthesegmentorsegmentstoenter
DifferentiationèDifferentiatingthemarketofferingtocreatesuperiorcustomervalue
PositioningèPositionthemarketofferinginthemindsoftargetcustomers
SEGMENTATINGCONSUMERMARKETS
Marketsegmetationdividesmarketintowell-definedslices.Amarketsegmentconsistsofa
groupofcustomerswhosharesimilarsetofneeds.Theyaredifferentsegmentation
methods:
1. Geographicsegmentation(NorthAmerica,Canada…)
Geographicalunitsasnations,states,regions,counties,citiesetc.Alotofcompaniesare
localizingtheirproductsandsalestofittheneedsofindividualregions.
2. Demographic
Age,gender,family,size,familylifecycle,income,occupation,education,religion,race…
• Ageandlife-cyclesegmentationisusedbysomecompanies.Butpayattention
againststereotypes.(GrandparentscangowiththeirchildrentoDisneylandfor
example)
• Gendersegmentationhaslongbeenusedinclothing,cosmetics…Wehaveanother
examplewithLegogamesforboysandforgirls
• Incomeincomeisusedbycompaniesofproductsandservicessuchasautomobiles,
clothes,travel…AnexampleistheAccorgroupwhohasahotelsforallkindof
budgets.AnotherexampleisVWgroupwhohasSeat&SkodabutalsoPorsche&
Lamborghini
ELBAKKALIYoussef
ThereisalsotheexampleofLIDL,ALDI,wealthypeoplealsogotothiskindofshops
becauseoftheeconomiccrisis.Andlowincomegroupswhobuyluxuryproducts
suchasLVMH,Sunglasses…
3. Psychographic(workingclass,…)
Dividingamarketintodifferentsegmentsbasedonsocialclass,lifestyle,orpersonality
characteristics.
Peopleinthesamedemographicgroupcanhaveverydifferentpsychographic
characteristics.Theproductspeoplebuyreflecttheirlifestylesandtheirpersonalities
TheyarepsychographicmeasurementsliketheStrategicBusinessInsight’sVALSwho
classifiesUSadultsinto8groups
1) Innovators1)Believers
2) Thinkers2)Strivers
3) Achievers3)Makers
4) Experiencers4)Survivors
Example:HertzSweden&Dogs
4. Behavorial
Dividingthemarketbasedonconsumerknowledge,attitudes,usesorresponsestoa
product
5. Occasion(regularoccasion,holiday,seasonal…)
Occasionswhenbuyersgettheideatobuyforaday,week,month…ForexampleChristmas,
Easter,amarriage…
6. Benefit
Thedifferentbenefitsthatconsumersseekfromtheproduct.Insomemarketssuchas
Championathleticpeoplelookforfunction&styleforexample.Wehaveanotherexample
withColgatetoothpastes(whiteteeth,sensitiveteethetc)
Wecanalsosegmentbusinessmarketswiththesamevariablesweuseinconsumer
markets.
NOTES:Marketersusuallyusemultiplesegmentationbasesandnotonlyone.
ELBAKKALIYoussef
REQUIREMENTSFOREFFECTIVESEGMENTATION
Tobeusefulmarketsegmentsmustbe
• Measurable:thesize,purchasingpower,andprofilesofthesegmentscanbe
measured(forexampleètheyare30.5millionlefthandedpeopleintheUS)
• Accessible:themarketsegmentscanbeeffectivelyreachedandserved
• Substantial:themarketsegmentsarelargeorprofitableenoughtoserveèFor
example,carmanufacturerscannotproducecarsonlyforfatpeople
• Differentiable:Ifmenandwomenrespondsimilarlytomarketingeffortsforsoft
drinks,youdon’thavetoseparatesegments
• Actionnable:Effectiveprogramscanbedesignedforattractingandservingthe
segments.
Asmallairlinecompanyidentifiedsevensegmentsbutitsmarketingstaffwastoo
small
SUMMARY
1. Targetmarketingincludesthreeactivities:marketsegmentation,markettargeting
andmarketpositioning.Marketsegmentsarelarge,identifiablegroupswithina
market.
2. Themajorsegmentationvariablesforconsumermarketsaregeographic,
demographic,psychographic,andbehavioral.Marketersusethemsinglyorin
combination
3. Businessmarketersuseallthesevariablesalongwithoperatingvariables,purchasing
approaches,andsituationalfactors.
4. Tobeuseful,marketsegmentsmustbemeasurable,substantial,accessible,
differentiable,andactionable.
5. Wecantargetmarketsatfourmainlevels:mass,multiplesegments,single(orniche)
segment,andindividuals
6. Amassmarkettargetingapproachisadoptedonlybythebiggestcompanies
7. GlobalizationandtheInternethavemadenichemarketingmorefeasibletomany.
8. Morecompaniesnowpracticeindividualandmasscustomization
ELBAKKALIYoussef
CHAPTER6TARGETING
Whichcustomerswillthecompanyserve?
DEFINITIONS
èTargetmarketisasetofbuyerssharingcommonneedsorcharacteristicsthatthe
companydecidestoserve
èMarkettargetingTheprocessofevaluatingeachmarketsegment’sattractivenessand
selectingoneormoresegmentstoenter
èUndifferentiated(mass)marketingAmarket-coverageinwhichafirmdecidestoignore
marketsegmentdifferncesandgoafterthewholemarketwithoneoffer
èDifferentiated(segmented)marketingAmarket-coveragestrategyinwichafirmdecides
totargetseveralmarketsegmentsanddesignsseparateoffersforeach
èConcentrated(niche)marketingAmarket-coveragestrategyinwhichafirmgoesaftera
largeshareofoneorafewsegmentorniches
èMicromarketingTailoringproductstospecificindividualsandlocalcustomersegments
èLocalmarketingTailoringbrandstotheneedsandwantsoflocalcustomers
èIndividualmarketingTailoringproductstotheneedsofindividualcustomers
TARGETING
Marketsegmentationrevealsthefirm’smarketsegmentopportunities.Thefirmhasto
evaluatenowthevarioussegmentsanddecidewhichitcanservebest
EVALUATINGMARKETSEGMENTS
Themarketer’staskistoidentifytheappropriatenumberandnatureofmarketsegments
anddecidewhichonetotarget.Thecompanymustfirstcollectandanalyzedataoncurrent
segmentsandthenchoosethegoodone.Thefirmmustlookatthreefactors:segmentsize
andgrowth,segmentstructuralattractivenessandcompanyobjectivesandresources.
SELECTINGMARKETSEGMENTS
Afterevaluatingsegments,thecompanymustdecidewhichandhowmanysegmentsitwill
target.
ELBAKKALIYoussef
Leftside=Massmarket;Rightside=Customization
a) Undifferentiated(mass)Marketing
Inthisstrategy,thecompanydecidestoignoremarketsegmentdifferencesandtargets
thewholemarketwithoneoffer.Itdesignsaproductwithanimagethatcanbesoldvia
massdistribution.AgoodexampleistheFord-Tinonecolor,black.
POSITIVEPOINTS
NEGATIVEPOINTS
-Lowercosts
- Difficulttoreachamassaudience
- Findaproductthatwillsatisfyall
consumers
- Problemsofcompetitionagainst
niches
b) Differentiated(segmented)Marketing
(+)Afirmdecidestotargetseveralmarketsegmentsand
designsseparateoffersforeach(suchasVWgrouporVF
Corporationwhoownsalotofknownbrands)
(-)Differentiatedmarketingincreasescosts.Developing
separatemarketingplansetcincreasescosts.
c) Concentrated(niche)Marketing
Astrategyinwhichafirmgoesafteralargeshareonasmallmarket(niche)
Throughconcentrationacompanyacquiresastrongpositionbecausetheyknowvery
welltheconsumerneeds.Itcanmarketmoreeffectivelyandefficiently.
Agoodnichemarketissmallbuthassize,profitandgrowthpotentialbutdoesnot
attractmanycompetitors
ELBAKKALIYoussef
d) Micromarketing
Itisthepracticeoftailoringtheproducttospecificindividuals«onetoonemarketing».
Todaymarketerscollectdata,criticsofusers…anddesigntheproducttheuserswant.
Micro-marketersseetheindividualineverycustomer
EXAMPLES:àLocalmarketing,GPSlocation,Masscustomization(NikeID),video
screenswhodeterminewhoiswatchingtheminordertochangetheads&retargeting
data(Sojern)
(-)Negativepoints:Micromarketingincreasescosts&createslogisiticproblems
SUMMARY
1.Targetmarketingincludesthreeactivities:marketsegmentation,markettargeting,
andpositioning.Marketsegmentsarelarge,identifiablegroupswithinamarket.
2.Twobasesforsegmentingconsumermarketsareconsumercharacteristicsand
consumerresponses.
Themajorsegmentationvariablesforconsumermarketsaregeographic,demographic,
psychographic,andbehavioral.Marketersusethemsinglyorincombination.
3.Businessmarketersuseallthesevariablesalongwithoperatingvariables,purchasing
approaches,andsituationalfactors.
4.Tobeuseful,marketsegmentsmustbemeasurable,substantial,accessible,
differentiable,andactionable.
5.Wecantargetmarketsatfourmainlevels:mass,multiplesegments,single(orniche)
segment,andindividuals.
6.Amassmarkettargetingapproachisadoptedonlybythebiggestcompanies.Many
companiestargetmultiplesegmentsdefinedinvariouswayssuchasvarious
demographicgroupswhoseekthesameproductbenefit.
7.Anicheisamorenarrowlydefinedgroup.GlobalizationandtheInternethavemade
nichemarketingmorefeasibletomany.
8.Morecompaniesnowpracticeindividualandmasscustomization.Thefutureislikely
toseemoreindividualconsumerstaketheinitiativeindesigningproductsandbrands
ELBAKKALIYoussef
CHAPTER7POSITIONING
Oneofthemostvaluableassetsofafirmisitsbrand.Abrandisaproductorservicewhose
dimensionsdifferentiateitfromotherproducts.Thesedifferencesmaybefunctional,
rational,ortangible(Goodquality).Theymayalsobemoresymbolic,emotional,or
intangible(IbuyaniPhonebecauseIloveApple).
Asconsumers’livesbecomemorecomplicatedandrushedabrand’sabilitytosimplify
decisionmakingandreduceriskbecomesinvaluable.Thesameproductcanbeperceivedin
adifferentwayifthebrandsaredifferent.(McDonaldsmilkorapplejuicetastesbetterthan
unmarkedones)
BRANDEQUITY
It’stheaddedvalueofthebrandonproductsandservices.Itcanbebecauseoftheway
consumersfeel,thinkandactwithrespecttothebrand.èSeethebrandzexamplewho
developedamodelofbrandstrengthbasedonPresence,Relevance,Performance,
Advantage,Bonding
Customer-basedbrandequityisthewaycustomersreacttoaproductwhenitisidentifiedor
not(IloveanadbecauseitsMercedesoul’inverse)
THESCOPEOFBRANDING
MarketerscanapplybrandingonEVERYTHINGèOngoods,onaservice,onacountry,a
politicalparty…
DIFFERENCIATIONANDPOSITIONING
Productsaremadeinfactories,butbrandshappeninthemindsofconsumers.Consumers
cannotevaluateproductseverytimetheybuy,tosimplifyit,theyorganizecompaniesinto
categoriesand“POSITION”themintheirminds.(It’sToyota,soit’sagoodcar)
BENEFITSOFBRANDPOSITIONINGANDDIFFERENTIATION
Positioningconsistsinoccupyingadistinctiveplaceinthemindsofthetargetmarket.
ELBAKKALIYoussef
IDENTIFIYINGOPTIMALPOINTS-OF-DIFFERENCEANDPOINTS-OF-PARITY
• Points-of-differenceareattributesthatconsumersstronglyassociatewithabrand,
andbelievetheycouldnotfindthesame.(SuchasMacbooks)
CriteriaifPODs
- Desirability:Consumersmustseethebrandaspersonallyrelevanttothem(Nivea
crème)
- Deliverabilty:thecompanyhastomaintainthebrandinthemindsofconsumers
- Differentiabilty:Consumersmustthebrandassociationassuperiorforthe
consumers
• Pointsofparityareattributesthatarenotnecessarilyuniquetothebrand
CHOOSINGADIFFERENTIATIONANDPOSITIONING
Theyare3steps:
1. Identifyingasetofdifferentiatingcompetitiveadvantagesonwhichtobuilda
position
2. Choosingtherightcompetitiveadvantages
3. Selectinganoverallpositioningstrategy
Inmanycases,twoormorefirmswillgoafterthesameposition.Soeachfirmmust
differentiateitsofferandcommunicateiteffectivelytothemarket.
1. IDENTIFIYINGASETOFCOMPETITIVEADVANTAGES
- Productdifferentiation(exBose)
- Servicedifferentiation(exBritishAirways)
- Chaneldifferentiation(exAmazon)
- Peopledifferentiation(exDisney)
2. CHOOSINGTHERIGHTCOMPETITIVEADVANTAGE
Imaginethatthecompanyfoundenoughpotentialdifferentiationsforacompetitive
advantage.Itnowmustchoosetheonesonwhichitwillworkandpromote.
èAlotofmarketersstandfortheUniqueSellingProposition(USP):whichmeansworking
as“numberone”onthatattribute(Safetyforexample)
èOthermarketersthinkthatthecompanyshouldpositionitselfonmorethanone
differentiator.
ELBAKKALIYoussef
Therightcompetitiveadvantagehastobe:(keycriteria)
• Important:Thedifferencedeliversahighlyvaluedbenefittotargetbuyers
• Distinctive:Competitorsdon’tofferthesamedifference
• Superior:Thedifferenceissuperiortootherwaysthatcustomersmightobtainthe
samebenefit
• Communicable:Thedifferenceiscommunicableandvisibletobuyers
• Preemptive:Competitorscannoteasilycopythedifference
• Affordable:Buyerscanaffordtopayforthedifference
• Profitable:Thecompanycanintroducethedifferenceprofitably
3. SELECTINGANOVERALLPOSITIONINGSTRATEGY
Thebrand’svaluepropositionis
thefullmixofbenefitsonwhich
abrandisdifferentiatedand
positioned.“WhyshouldIBuy
yourbrand?”.Itcanbe“paying
moreformorequality”suchas
Audicars
Theredcellsshowthelosing
valuepropositionsandthe
greenonesrepresentwining
valuepropositions.
CHAPTER8MARKETINGPLAN
AmarketingplanIsawrittendocumentthatsummarizeswhatthemarketerhaslearned
aboutthemarketplaceandindicateshowthefirmplanstoreachitsmarketingobjectives.
Eachproductlevelmustdevelopamarketingplanforachievingitsgoals(example
UnileverèDove)
Themarketingplanshowshowtheorganizationwillachieveitsobjectivesthrough
marketingstrategies,theconsumeristhestartingpoint.Today,marketingplansare
customer&competitorsoriented.
ELBAKKALIYoussef
CONTENTOFAMARKETINGPLAN
èExecutivesummary&tableofcontents:Presentsabriefsummaryofthemaingainsin
ordertohelptopmanagementfindingtheplan’smajorpointsquickly
èSituationanalysis:Relevantdataonsales,costs,themarket,competitors,the
macroenvironment…
Describesthetargetmarketandacompany’sposition,includinginformationaboutthe
market,productperformance,competition,&distribution:
• Amarketdescrpition
• Aproductreview
• Areviewofcompetition
• Areviewofdistribution
èThreatsandopportunitiesanalysis
Assessesmajorthreatsandopportunitiesthattheproductmightface,helpingmanagement
toanticipateimportantpositiveornegativeimpactsonthecompany
èObjectivesandissues
Statesthemarketingobjectivesthatthecompanywouldliketoattainandhowtoachieve
them.
èMarketingstrategy:Herewedefinethemission,marketing&financialobjectivesand
needsthemarketofferingisaskingthroughcompetition&position.
Itanswersthequestion.Howwillthecompanycreatevalueforcustomersinorderto
capturevaluefromcustomersinreturn?Italsooutlinesthespecificstrategyforeach
marketingmixelementandexplainshowtorespondtothreatsandopporutnities.
èActionprograms
èFinancialprojectionsThisisessentiallyaprojectedprofit&lossstatementwhichshows
expectedcosts,profit…Onceapproved,itbecomesthebasisforall,incluidingmarketing
operations
ELBAKKALIYoussef
èImplementationcontrols:Spellingoutthegoalsandbudgetsforeachmonth,sothatthe
managementcanrevieweachperiod’sresults.
Alotofsuprisesoccurduringtheimplementationofmarketingplans,thisiswhymarketer
usemarketingcontrol&KPI’s(keyperfomanceindicators).Itinvolves3steps:
1. Themanagmentsetsspecificmarketinggoals
2. Thenitmeasuresitsperformanceinthemarketplace
3. Themanagementtakescorrectiveactiontoclosethegapsbetweengoalsand
performance
Thepurposeistoensurethatthecompany’sgoalsetoutinitsannualplan
ELBAKKALIYoussef
CHAPTER9KPI’s&MEASUREMENT
"HalfthemoneyIspendonadvertisingiswasted;ThetroubleisIdon'tknowwhichhalf.”
It’snoteasytomeasuretheresultsofmarketingexpensesbecauseoutputssuchasthe
brandimage,thecustomerloyalty…cantakealotoftimetomanifestthemselves.Itishard
toisolatetheeffectsofanyparticularmarketingacitivity.
But,measuringthereturnonmarketingisakeynecessityformarketingmanagers,they
havetobesurethattheirmarketingfundsarebeingwellspent.Today“marketing
accountability”becomesmoreandmoreimportant.
DEFINITIONS
èMarketingmetricsisasetofmeasuresthathelpsquantify,compare,andinterpretthe
marketingperformance
è Marketingcontrolismeasuringandevaluatingtheresultsofmarketingstrategies&
plansandtakingcorrectiveactionstoensurethattheobjectivesareachieved(seechapter8)
èMarketingROIisthenetreturnfromamarketinginvestmentdividedbythecostsofthe
marketinginvestment.
èKeyperformanceindicators(KPI’s)it’saperformancemeasurement.Itisusedto
evaluatesuccess,orsuccessinaparticularactivityandthisismadeperiodically.
KPIsMEASURMENT
AwinningKPIis
àEasytounderstand
àMeaurable
àActual(uptodate)
àNotgreatinnumber
MARKETINGDASHBOARDS
Marketingdashboardsareliketheinstrumentpanelinacarorplane,visuallydisplayingreal
timeindicatorstoensureproperfunctioning.Itisveryinterestingbecauseitbringsdata
alivetoimprovedanalysis.
ELBAKKALIYoussef
MARKETINGSCORECARDS
àAcustomer-performancescorecardrecordshowwellthecompanyisdoingyearafter
yearoncustomer-basedmeasures
àAstakeholder-performancescorecardtracksthesatisfactiononcompany’sperformance
ofemployees,suppliers,banks,distributors,retailers,andstockholders.
MARKETINGMETRICS
AccordingtoAmbler,measuringmarketingperformancecanbesplitintotwoparts
àShorttermresultssuchassalesturnover,shareholdervalue…
àChangesinbrandequityincludecustomerbeahaviors,percievedquality,loyalty,etc
MARKETINGROI
Everycampaign
yourunshould
haveanROI.Itisa
quantifiedwayto
analyze,improve
andpredictthe
returnon
marketing.Many
companiesuse
customer
relationship
measuressuchas
satisfaction,
retentionand
equity