Marketing

Marketing seeks to:

1. Discover needs and wants of customers, and then 2. Satisfy them

Ways to segment consumer markets

1. Geographic segmentation 2. Demographic segmentation 3. Psychographic segmentation (lifestyle) 4. Behavioral segmentation (features and usage rate- heavy, medium and light users) 5. Attitudinal segmentation ( needs, occasions, attitudes, perceptions, values, and more)

Stage 1- New Product Development Strategy Why New Products?

1. Growth for your portfolio 2. Grow your share of the market 3. News for your marketing calendar

Three Aspects of the Product Life Cycle

1. Length of the product life cycle (depends on industry, or product class) 2. Shape of the product life cycle (depends on product type) Generalized life cycle High learning product Low learning product Fashion product Fad product 3. Rate of consumer adoption

Growth Strategies

1. Market penetration: Increase sales of current product in current markets 2. Market development: Sell current products to new markets 3. Product development: Sell new products to current markets 4. Diversification: Develop new products to sell in new markets

4 things needed for marketing to occur

1. Two+ parties with unsatisfied needs 2. A desire and ability to be satisfied 3. A way for the parties to communicate 4. Something to exchange

The purchase decision process

1. problem recognition 2. information search 3. alternative evaluation 4. purchase decision 5. post purchase behavior

Market. vs a target market

A market consists of people with both the desire and the ability to buy a specific offering A target market consists of one or more specific groups of potential consumers towards which an organization directs its marketing program

Stage 2- Ideation What is New Product Concepting?

A new product concept is a written idea of a new product that gets developed, shared and evaluated Written idea- white paper Concept With illustrations- full blown concept Developed in some sort of creative process Evaluated- accordingly, according to a) budget and b) risk/reward

New Product Concept Templates

A structured way to facilitate thinking of ideas for new products for an ideation session or any type of new product development process Brand Occasions Benefits Audience/Target

Writing a New Product Concept

A written description of a new product, what it is, what it's for and what it does Brand Occasions Benefits

Environmental foces

Are the uncontrollable forces that affect a marketing decision and consist of social, economic, technological, competitive, and regulatory forces

Google Glasses were an example of bad screening and evaluation

Augmented reality glasses: Prototypes sold to 8000 qualified "Glass Explorers" for 1500 Incomplete product testing Wearers were dubbed "Glassholes" Withdrawn from market

How will we grow? The BCG Model

Business portfolio analysis (BCG Matrix) 1. Question marks: Low share of high-growth market 2. Stars: High share of high growth markets 3. Cash cows: Generate large amounts of cash 4. Dogs: Low share of slow-growth markets

Chapter 8- Marketing Research Reading review- pages 210-215

Data The facts and figures related to the project that are divided into two main parts: secondary data and primary data Secondary data Facts and figures that have already been recorded prior to the project at hand Primary data Facts and figures that are newly collected for the project Observational data Facts and figures obtained by watching how people actually behave, using mechanical, personal, or neruomaking data collection methods

Psychological Influences

Consumer Values, Beliefs, and Attitudes An attitude is a learned predisposition to respond to an object or class of objects in a consistently favorable or unfavorable way Values and beliefs shape attitudes Beliefs are a consumer's subjective perception of how a product or brand performs on different attributes based on personal experience, advertising, and discussions with other people Marketers use three approaches to change attitudes; 1. Change beliefs about a brand's attributes 2. Change perceived importance of attributes 3. Add new product attributes Brand loyalty is a favorable attitude toward and consistent purchase of a single brand over time

Chapter 5- Consumer Behavior Reading review-pages 125-128, 131-134,136-137

Consumer behavior The actions a person takes in purchasing and using products and services, including the mental and social processes that come before and after these actions Purchase decision process The five stages a buyer passes through in making choices about which products and services to buy: 1. Problem recognition, 2. information search. 3. alternative evaluation, 4. purchase decision, and 5. postpurchase behavior Consumer touchpoints A marketer's product, service, or brand points of contact with a consumer from start to finish in the purchase decision process Consumer journey map A visual representation of all the touchpoints a consumer comes into contact with before, during, and after a purchase Motivation The energizing force that stimulates behavior to satisfy a need Personality A persons consistent behaviors or responses to recurring situations Perception The process by which an individual selects, organizes, and interprets information to create a meaningful picture of the world Learning Those behaviors that result from 1. repeated experience and 2 reasoning Brand loyalty A favorable attitude toward and consistent purchase of a single band over time Attitude A learned predisposition to respond to an object or class of objects in a consistently favorable or unfavorable way Beliefs A consumers subjective perception of how a product or brand performs on different attributes based on personal experience, advertising, and discussions with other people

Consumer Products

Consumer products are products purchased by the ultimate consumer Convenience products Shopping products Specialty products Unsought products

Apple customer Journey Map and Consumer Touchpoints for Electronic Devices Sold in Apples Stores

Consumer touchpoints are a marketer's product, service, or brand points of contact with a consumer from start-to-finish in the purchase decision process

Organizations

Core Values are the fundamental, passionate, and enduring principles of an organization that guide its conduct over time A mission is a statement of the organization's function in society that often identifies its customers, markets, products, and technologies. The term is often used interchangeably with vision

Gatorade Case study- How PepsiCo Extended the product life cycle

Creating the Gatorade brand- Florida Gators invented it

Step 4- Select Target Markets

Criteria to use in selecting target markets: 1. Market size- size of the prize 2. Expected growth 3. Competitive position 4. Cost of reaching the segment 5. Organizational compatibility Market Size-No breakfast - too small a breakfast; between meal snacks is the biggest market Focus on four student segments only- easier to reach these segments

Customer Relationship Management

Customer relationship management (CRM) is the process of identifying prospective buyers, understanding them intimately, and developing favorable long-term perceptions of the organization and its offerings so that buyers will choose them in the marketplace This is typically your email program and the strategy and software you use to execute it

Customer Value Proposition

Customer value proposition is the cluster of benefits that an organization promises customers to satisfy their needs We call this the bundle of benefits

Step 5- Take marketing actions

Different marketing tactics for different segments

Marketing seeks to

Discover consumer needs through research and then satisfy them with a marketing program

Chapter 2- Organizational Strategies Reading Review- pg. 31-33,37-43

Each strategic business unit has a functional level, where groups of specialists actually create value for the organization The term department generally refers to these specialized functions such as marketing and finance At the functional level, the organization's strategic direction becomes its most specific and focused When developing marketing programs for new or improved offerings, and organization's senior management may form cross functional temas These consist of a small number of people from different departments who are mutually accountable to accomplish a task or a common set of performance goals To be successful today's organizations must be forward looking Core values are the fundamental, passionate, and enduring principle that guid its conduct over time By understanding its core values, an organization can take steps to define its mission, a statement of the organizations function in society that often identifies its customers, markets, products, and technologies Vision is another way and should be clear concise meaningful inspirational and long term Organizational culture- the set of values, ideas, attitudes, and norms of behavior that is learned and shared among the members of an organization business describes the clear, broad, underlying industry or market sector of an organizations offering Business portfolio analysis A technique that managers use to quantify performance measures and growth targets to analyze their firms strategic business units (SBUs) as though they were a collection of separate investments Diversification analysis A technique that helps a firm search for growth opportunities from among current and new markets as well as current and new products Strategic marketing process The process whereby an organization allocates its marketing mix resources to reach its target markets and achieve a competitive advantage Situation analysis is taking stock of where the firm or product has been recently, where it is now, and where it is headed in terms of the organizations marketing plans and the external forces and trends affecting it Market segmentation Involves aggregating prospective buyers into groups, or segments, that 1. have common needs and 2. will respond similarly to a marketing action Customer value proposition The cluster of benefits that an organization promises customers to satisfy their needs Points of difference Those characteristics of a product that make it superior to competitive substitutes

Stage 4: Business Analysis

Early forecasting- how did it do on the concept test, E.g. did 50% of our audience say they'd purchase it? Develop a P&L- what will the cost of goods sold be? Packaging? Preliminary marketing/advertising Any capex required? (capital expenditure is when you have to buy something new to make it, like a new packaging line, new form capabilities Example- imprinted cookies

Alternative evaluation stage

Evaluate criteria are the factors that represent both the objective attributes of a brand and the subjective ones a consumer uses to compare different products and brands A consideration set is the group of brands that a consumer would consider acceptable from among all the brands in the product class of which he or she is aware

Stage 2: Idea Generation

Idea generation is the stage of the new-product process that develops a pool of concepts to serve as candidates for new products, building upon the previous stage's results

Industry trends vs Macrotrends

Industry trends Ex. Coffee industry New flavors and seasonal blends Online ordering Cold brew coffee Roastery tasting rooms Coffee bars Adweek Capture of Macrotrends Social responsibility Economy Working from home and leisure ware Social justice Sustainability DTC=online shopping Response to pandemic

Development

Is the stage of the new product process that turns the idea on paper into a prototype

Business analysis

Is the stage of the new-product process that specifies the features of the product and the marketing strategy needed to bring it to market and make financial projections. Basically early forecasting and creating the P&L

Information that's Actionable

It is easy to confuse data with information -Data= the raw facts, recorded measures of certain phenomena -Information=transformed and organized facts in a form suitable for managers to base decisions

Stage 5: Development- get to a prototype

Like a Concept Car Mobile App in development/testing phase CPG products get developed in the R&D lab Restaurants menu items get developed in the kitchen "lab"

Chapter 9- Segmentation Reading Review- pages 237-245,249-252,255-256

Maket segmentation Involves aggregating prospective buyers into groups, or segments, that 1. have common needs and 2. will respond similarly to a marketing action Product differentiation A marketing strategy that involves a firm using different marketing mix actions to help consumers perceive a product as being different and better than competing products Market product grid A framework to relate the markets segments of potential buyers to products offered or potential marketing actions Usage rate The quantity consumed or patronage during a specific period. Frequency marketing focuses on usage rate 80/20 rule A concept that suggests 80 percent of a firm's sales are obtained from 20 percent of its customers Customer lifetime value Represents the financial worth of a customer to a company over the course of their relationship Product positioning The place a product occupies in consumers minds based on important attributes relative to competitive products Product repositioning Changing the place a product occupies in a consumer's mind relative to competitive products Perceptual map A means of displaying in two dimensions the location of products or brands in the minds of consumers to enable a manger to see how they perceive competing products or brands, as well as the firm's own product or brand

Why Segment Markets What Market segmentation means

Market segmentation involves aggregating prospective buyers into groups, or segments, that 1. have common needs and 2. will respond similarly to a marketing action Product differentiation is a marketing strategy that involves a firm using different marketing mix actions to help consumers perceive the product as being different and better than competing products Segmentation= Linking needs to actions

Marketing research

Marketing research is also the function that links the consumer to the marketer through information

The implementation phase= Executing the marketing program

Marketing strategy is the means by which a marketing goal is to be achieved, usually characterized by a specified target market and a marketing program to reach it This is a statement Marketing tactics are the detailed, day-to-day operational marketing actions for each element of the marketing mix that contributes to the overall success of marketing strategies These are actions

Psychological influences on Consumer behavior Consumer motivation

Motivation Maslow Hierarchy of Needs -Physiological needs -Safety needs -Social needs -Personal needs -Self-actualization needs Maslow's Hierarchy of Needs stems from his Theory of Motivation, which poses that humans are motivated to fulfill lower level needs first, and then higher level needs before they can achieve self-actualization

Stage 1: New-Product Strategy Development

New Product strategy development is the stage of the new product process that defines the role for a new product in terms of the firm's overall objectives Its about connecting your new product ideas to your overall brand and/or portfolio strategy Swot analysis- what's happening in your category and with competitors Environmental scanning/macrotrends

Seven stages in the new product process leading to success

New product development process

News for your Marketing Calendar

News is about having something to say To consumers in ad campaigns To buyers in the distribution channel Frito-Lay Halloween treat packs are seasonal news for the grocery channel, to get distribution

Nike

Nike marketers were pioneer's with the 1984 Nike Just Do It campaign that flipped the communication hierarchy to focus on the core value

Why Segment Markets

Organizational synergy- increased customer value achieved through performing organizational functions such as marketing or manufacturing more efficiently The ability to focus your marketing and advertising dollars

The Segmentation Tradeoff: Synergies vs. Cannibalization

Organizational synergy- increased customer value achieved through performing organizational functions such as marketing or manufacturing more efficiently Cannibalization- one of your products/brands is stealing customers from another

The strategic marketing process has three phases: planning, implementation, and evaluation

Planning 1. Situation analysis 2. Market Product Planning/Focus, 3. Marketing Program Implementation Marketing Strategy Marketing Tactics Evaluate

Problem recognition and Consumer behavior

Problem recognition starts with the difference between: 1.Consumer's ideal situation 2. Consumer's actual situation Consumer behavior consists of the actions a person takes in purchasing and using products and services, including the mental and social processes that come before and after these actions

Chapter 10- New Products Reading review- pages 266-268, 275-282,GoPro

Product A good, service, or idea consisting of a bundle of tangible and intangible attributes that satisfies consumers needs and is received in exchange for money or something else of value Consumer products Products purchased by the ultimate consumer Business products Products organizations buy that assist in providing other products for resale, Also called B2B products or industrial products Convenience products Items that the consumer purchases frequently, conveniently, and with a minimum of shopping effort Shopping products Items for which the consumer compares several alternatives on criteria such as price, quality, or style Specialty products Items that the consumer makes a special effort to search out and buy Unsought products Items that the consumer does not know about or knows about but does not initially want Product item A specific product that has a unique brand, size, or price Product line A group of product or service items that are closely related because they satisfy a class of needs, are used together, are sold to the same customer group, are distributed through the same outlets, or fall within a given price range Product mix Consists of all the product lines offered by an organization New product development process The seven stages an organization goes through to identify opportunities and convert them into salable products or services New product strategy development The stage of the new product development process that defines the role for a new product in terms of the firms overall objectives Idea Generation The stage of the new product development process that develops a pool of concepts to serve as candidates for new products, building upon the previous stage's results Screening and evaluation The stage of the new product development process that internally and externally evaluates new product ideas to eliminate those that warrant no further effort Business analysis The stage of the new product development process that specifies the features of the product and the marketing strategy needed to bring it to market and make financial projections Development The stage of the new product development process that turns the idea on paper into a prototype Market testing The stage of the new product development process that exposes actual products to prospective consumers under realistic purchase conditions to see if they will buy Commericialization The stage of the new product development process that positions and launches a new product in full scale production and sales

Product Classes, Forms, Items, Lines, and MIxes

Product Item Product Line Product Mix

Chapter 11- Managing Brands and the Product Life Cycle Reading Review- Pages 290-299

Product Life Cycle Describes the stages a new product goes through in the market place: introduction, growth, maturity, and decline Product class Refers to the entire product category or industry Product form Pertains to variations of a product within the product class

The Product Level: Class and Form

Product class: The entire product category or industry (Example: Prerecorded music) Product form: Variations of a product within the product class (Example: Cassettes, CD, music streaming) Also called a platform

Product differentiation

Product differentiation is a marketing strategy that involves a firm using different marketing mix actions to help consumers perceive the product as being different and better than competing products

Product Positioning

Product positioning is the place a product occupies in consumer's minds based on important attributes relative to competitive products A perceptual map is a means of displaying in two dimensions the location of products or brands in the minds of consumers to enable a manager to see how they perceive competing products or brands, as well as the firm's own product or brand Product repositioning involves changing the place a product occupies in a consumer's mind relative to competitive products

Grow your share of the market

Repositioning brands Adding attributes and benefits Expanding distribution to reach new audiences

Situational Influences

Situational influences affect purchase decisions 1. Purchase task 2. Social surroundings 3. Physical surroundings 4. Temporal effects (time) 5. Antecedent states 9mood or cash on hand/purchasing power) Situational influences are the five aspects of the purchase situation that impact the consumer's purchase decision process These also add up to purchasing occasions

Step 1, Step 2

Step 1 Group Potential Buyers Into Segments Step 2 Group Products into Categories

3 steps of THE PLANNING PHASE- Situation analysis, Market Product Planning/Focus, Marketing Program

Step 1: Situation (SWOT) analysis SWOT analysis Strengths Weaknesses Opportunities Threats SWOT Analysis actions: Build on a strength Correct a weakness Exploit an opportunity Avoid a threat A situation analysis involves taking stock of where the firm or product has been recently, where it is now, and where it is headed in terms of the organization's marketing plans and the external forces and trends affecting it SWOT is the structure for doing it

The Planning Phase

Step 2: Develop a market-product focus, customer value proposition, and goals Market segmentation involves aggregating prospective buyers into groups, or segments, that 1. have common needs and 2. Will respond similarly to a marketing action Customer value proposition is the cluster of benefits that an organization promises customers to satisfy their needs Points of difference are those characteristics of a product that make it superior to competitive substitutes This feeds your positioning statement

The strategic marketing process -The planning phase

Step 3: Design a marketing program- a plan for the marketing mix Product strategy Price strategy Promotion strategy Place (distribution) strategy

Chapter 1- What is Marketing? Reading review- pages 8-11

The first objective in marketing is discovering the needs of prospective customers. Marketers often use customer surveys, concept tests, and other forms of marketing research to better understand customer ideas. Many firms also use crowdsourcing or innovation tournaments to solicit and evaluate ideas from customers Sometimes customers may not know or be able to describe what they need and want. Smartphones, connected homes, and electric cars are all examples of this, in which case an accurate long term prediction of consumer needs is essential Experts estimate it takes 3000 raw ideas to generate one commercial success 1. Focus on what the customer benefit is and 2. learn from past mistakes Marketing tries to satisfy consumer needs and wants A need occurs when a person feels deprived of basic necessities such as food A want is a need that is shaped by a person's knowledge, culture, and personality Potential consumers make up a market, which is people with both the desire and the ability to buy a specific offering All markets ultimately are people Marketing doesn't stop with the discovery of consumer needs Target market is the one or more specific groups of potential consumers toward which an organization directs its marketing program Having selected its target consumers, the firm must take steps to satisfy their needs Someone in the organization's marketing department often the marketing manager must develop a complete marketing program to reach consumers by using a combination of four elements Product. A good service or idea to satisfy the consumers needs Price. What is exchanged for the product Promotion. A means of communication between the seller and buyer Place. A means of getting the product to the consumer These are the elements of the marketing mix These are controllable factors

Pringles and Comet

The idea also could have come from cross-functional packaging capabilities

How marketing satisfies consumer needs: The four Ps

The marketing mix consists of the marketing manager's controllable factors -product, price, promotions, and place- that can be used to solve a marketing problem OR create a marketing strategy Components A marketing program is a plan that integrates the marketing mix to provide a good, service, or idea to prospective buyers Integrates A marketing plan is a road map for the marketing actions of an organization for a specified future time period, such as one year or five years Time

The purchase decision process consists of five stages

The purchase decision process consists of five stages a buyer passes through in making choices about which products and services to buy 1. Problem recognition 2. Information search 3. Alternative evaluation 4. Purchase decision 5. Postpurchase behavior

What is innovation?

What is innovations? Inventing something new in your category New packaging New forms New features What is an innovation pipeline Having a 2-5 year plan for expanding your brand and portfolio

The role of marketing research

What is marketing research Marketing research is the process of defining a marketing problem and opportunity, systematically collecting nd analyzing information, and recommending actions

Core value pyramid

When marketing researchers and advertisers started to use the basis of Maslow's hierarchy to help consumers connect product attributes to what's important in their life, This made a core value pyramid

Marketing

is the activity for creating, communicating, delivering, and exchanging offerings that benefit its customers, the organization, its stakeholders, and society at large

Chapter 3- Environmental Scanning Read about the cohorts on pg. 77-78

Worldwide the number of people 60 years and older is expected to more than double in the coming decades and reach 2.1 billion by 2050 The US population is getting bigger and older Baby boomers the 76 million children born between 1946 and 1964

Market product grid

a market product grid is a framework to relate the market segments of potential buyers to products offered or potential marketing actions a market product grid shows the kind of sleeper that is targeted for each of the bed pillows. with a different firmness

Environmental scanning

is the process of continually acquiring information on events occurring outside the organization to identify and interpret potential trends Environmental scanning= MACROTRENDS

Market Testing

is the stage of the new-product process that exposes actual products to prospective consumers under realistic purchase conditions to see if they will buy. Standard test markets (using normal distribution channels) Controlled test markets (3rd party runs a smaller test market) Simulated test markets (basically a marketing research study)

Screening and evaluation

is the stage of the new-product process that internally and externally evaluates new-product ideas to eliminate those that warrant no further effort.