Download Marketing Concepts - MrB-business

Marketing Concepts
Workbook – DO NOW
• Page 254 – Tesco is Market leader in
Thailand.
• Question 1,2,3 (15 mins)
Adding Value
• Marketing is the added value on most
products, the customers will pay for
something the perceive is of better quality.
How Companies Add Value
• Retail environment improvements i.e. a
beauty salon or hairdresser needs to make
the customer feel welcome, magazines,
comfortable waiting area, TV etc
• Packaging creates a POD i.e. Chocolate
• Promotion must have brand
Ie Coke, Levis
• Create a USP – differentiates your
product from competitors.
USP + Product Differentiation
• USP – the feature of the product that
differentiates it from the competitor.
• Product Differentiation – Making the
product stand out from competitors in the
consumers perception.
Sink Water
Fountain
Golf Club and
Weedwacker
Mass Marketing
• Selling product to the whole market
without targeting anyone specifically.
• This isn't very common as it means there
is no real direction for your product line.
• What Companies would you consider use
mass marketing?
Advantages of Mass Marketing
• Small Market Niches don’t allow
economies of scale to be achieved. Mass
Marketing firms will have lower costs of
production.
• Mass Market strategies run fewer risks
than Niche Market. Ie if tastes and
preferences change in your niche this can
result in a loss of sales.
Niche Marketing
• Identifying and exploiting a small segment
of a larger market by developing products
to suit it.
• What companies might use Niche
Marketing as there approach?
Advantages of Niche Marketing
• Small Firms can survive and thrive in
markets that are dominated by large firms.
• Sometimes you can make high profits
because of a lack of competitors within the
market.
• Niche market products can be used by
large firms to create status and image that
their mass market products lack.
Market Segmentation
• Market segment – A sub group of consumers
within a market in which consumers have similar
characteristics.
• Market Segmentation – identifying different
segments within a market and targeting different
products or services to them.
• This approach is very normal within the business
world, it requires businesses really
understanding consumers and the groups within
there market.
Market Segmentation
• What Segments of the market are the
following products targeted at?
Market Segmentation
• Marketers need to identify different
consumer groups that are most likely to
buy there products.
• This leads to a consumer profile, so the
marketing can be more effective in terms
of promotion, design and price.
• Consumer profiles include – age, income
level, location, gender and social class.
Market Segmentation
• There are three commonly used basis for
segmentation
• Geographic Differences
• Demographic Differences
• Psychographic Differences
Geographic differences
• Consumer tastes may vary between different
areas so it may be appropriate to offer different
products and market them in location specific
ways.
• Different countries have different cultures so
some forms of advertising are not going to be
acceptable in different countries.
• Before entering a new market extensive
research needs to be done to avoid a loss of
sales from a disrespect of local laws or culture.
Examples
• Frank Perdue's chicken slogan, "it takes a strong
man to make a tender chicken" was translated
into Spanish as "it takes an aroused man to
make a chicken affectionate".
• The Coca-Cola name in China was first read as
"Ke-kou-ke-la", meaning "Bite the wax tadpole"
or "female horse stuffed with wax", depending
on the dialect. Coke then researched 40,000
characters to find a phonetic equivalent "ko-ouko-le", translating into "happiness in the mouth".
Examples
• We all know about GM's Chevy Nova
meaning "it won't go" in Spanish markets,
but did you know that Ford had a similar
problem in Brazil with the Pinto? Pinto was
Brazilian slang for " tiny male genitals".
Ford renamed the automobile Corcel,
meaning "horse".
Demographic Differences
• The most common use for segmentation.
• Demography is the study of the population data, and
identifies the following characteristics.
-Age
-Income
-Sex
-Religion
-Ethnicity
- Social Class
• This helps organizations become more effective with
there marketing.
Demographic Differences
• Socio economic groups or social class
include – Upper Middle class, Middle
Class, Lower Middle class, working class.
• Your class often determines what you
would spend your income on, so the
higher the class the more likely to spend
money on luxury goods.
Class System
• Identify two products that each different
class might buy.
- Upper Class
- Middle Class
- Lower Middle Class
- Working Class
Acronyms for different Groups
• DINKY – double income no kids yet
• NILK – no income lots of kids
• WOOF – well off older folk
• SIN BAD –
Single Income, No Boyfriend and Absolutely
Desperate
• GLAM –
Greying, Leisured, Affluent, Middle-aged
• YUPPIE –
Young Urban Professional
Psychographic factors
• Differences in consumers lifestyles,
personalities, values and attitudes. These
can be influenced by the consumers social
class.
• I.e. consumers different attitudes to ethical
business, private education and organic
food
Psychographic Factors
• How Might your Life Style affect your
purchasing decisions?
• What about your personality?