TGM 204 Final

Strategic Business Unit (SBU)

- a unit or division of a large corporation that operates almost as an independent business.

5 forces model

1. threat of entry 2. power of suppliers 3. power of buyers 4. threat of substitutes 5. rivalry among existing competitors

What is a Market?

Actual or potential customers with....unmet need or want, willingness to buy, buying power (ability), authority to buy

Demographic Segmentation

Dividing the market into groups based on variables such as: Age Gender Family size or life cycle Income Occupation Education Religion Race Generation Nationality Popular bases and easiest to measure

Target Marketing

Evaluating Market Segments Segment size and growth Segment structural attractiveness Level of competition Substitute products Power of buyers Powerful suppliers Company objectives and resources

Strategic Marketing Thinking

Global companies must balance the forces that favor globalization and those which favor localization. The debate: standardization vs. adaptation The debate: centralization vs. decentralization Value chain: focus on activities Thinking global: configuration vs. coordination

Low Context Culture

Individualism predominates, relationships begin and end quickly, social structure is decentralized, space is compartamentalized, time and process are important, and communication relies primarily on verbal content. direct and rational advertising messages providing product information (Germany, USA)

Value Chain Redrawn

Industrial Design Procurement manufacturing outbound logistics marketing sotre mgmt consumer

The Positioning Statement

Internal and confidential It is a strategic statement It drives all aspects of the communication with the market It establishes for the Ad Agency the principles to follow in their creative work It is a long term policy document

Marketing activities chain

Market Research & Analysis Market Segmentation & Targeting Competition Analysis Brand Development & Positioning Product Management Pricing Strategy Communication: traditional and digital Performance and Control

Purpose of Segmentation

Market Selection: To choose for marketing attention those segments that best fit the company's competence. Analysis - To understand better the total market place as well as how and why customers buy.

Target Market

Market segment(s) company chooses to pursue because of its attractiveness.

Globalization-Strategic Decisions

Marketingthe extent to which same brand names, advertising, sales promotions, etc. are utilized in each country Competitive movesthe extent to which moves in individual countries are viewed and coordinated with an integrated perspective

Marketing Essentials

Marketing focuses on creating and delivering value to satisfy needs and desires of consumers. For business and social entities Know thy consumer Offering: Product, Price, Promotion, Distribution - tightly tied together - unity for success - Marketing Mix Not all consumers/customers are created equal No company can serve every market well, therefore Segmentation (to optimize efforts) - the process of dividing markets into segments that are homogeneous and react similarly to the offer B2C - processes by which company sells to consumers

Humans are Multicultural

National culture Regional, Religious, Ethnic or Linguistic culture Gender level culture Generation level culture, e.g. grandparents Role category, e.g. parent, teacher Social class Corporation employee, e.g. I am Sumitomo san Interest group, e.g. skateboarding, surfing

Marketing Mix (4 P's)

Product, Price, Place, Promotion- All the elements are interconnected and interdependent. Changes to one affect all. The marketing mix has to evolve with, and respond to changes in consumer expectations and competition.

Born Global Company

Rapid internationalization Technically inclined leaders Agile learning organizations Collaborate and connect to 'global webs of enterprises' Build business by serving specialized niches

High Context Culture

Societies tend to be more collectivist, place high value on personal relationships, space tends to be more communal, and communication involves verbal and non-verbal content. Indirect and transformational advertising messages creating emotions through pictures and entertainment (France, Japan)

PESTLE analysis

TOOL USED IN SITUATION ANALYSIS. IT PROVIDES AN UNDERSTANDING OF THE MACRO-ENVIRONMENTAL FORCES THAT HAVE AN IMPACT ON THE BUSINESS. THESE FORCES CAN REPRESENT A THREAT OR CREATE AN OPPORTUNITY FOR THE BUSINESS. IT HELP ASSESS THE HEALTH OR DECLINE OF MARKETS, BUSINESS POSITION, AND POTENTIAL FOR GROWTH.

Place

The chain of companies responsible for bringing the product to the consumer where the consumer wants, when the consumer wants, in the form/shape the consumer wants.

Promotion

The collection of tools and processes chosen to communicate with the target market, create a relationship, build awareness, build preference, and manage loyalty.

Brand Promise

The explicit and implicit set of expectations, guarantees and commitments that a product offers its buyers or users.

Collectivistic

The goals of the group take precedence over the goals of the individual Members are responsible for the group as a whole Success is measured by one's contribution to the group as a whole, e.g. Toyota man Direct confrontation is avoided Thailand, korea, japan, Russia, brasil, mexico, arab countries ...

Positioning

The place the brand/product occupies in consumers' minds relative to competing brands/products. Defined by consumers on the basis of important attributes.

Price

The price the consumer pays for the product. Once the firm has created value to the customer it is entitled to capture some of the value for itself. Price is affected by the demand and supply for the good or service.

Marketing

The science and art of exploring, creating, and delivering value to satisfy the needs of a target market at a profit. Marketing identifies unfulfilled needs and desires. It defines, measures and quantifies the size of the identified market and the profit potential.

Product

The total package of benefits received by the consumers, it may include the physical product, brand, company reputation, availability, store design, location, etc.

Positioning Example

To highly social young adults who are concerned about fresh breath, Colgate Fresh Confidence is the gel toothpaste that delivers long-lasting fresh breath.

JBC Objectives

To illustrate different approaches to market segmentation To analyze which characteristics contribute to the attractiveness of a market segment To introduce the concept of "majority fallacy" To highlight the interaction between market definitions and market share measures To show that financial and qualitative analysis is necessary to assess market opportunities

Promotion- marketing essentials

all the communication activities geared to establishing and nurturing a relationship with the customer.

B2B

business to business

Forces Favoring Localization

differences in customer needs country-specific regulatory pressures pressures for speedy delivery high weight-to-value ratio tariffs and non-trade barriers differences in customer tastes and preferences *differences in marketing infrastructures *differences in regulations and standards

Forces of Localization

differences in customer tastes and preferences *differences in marketing infrastructures *differences in regulations and standards

Coordination

how similar activities performed in different countries are coordinated with each other.

Culture

is the collective programming of the mind which distinguishes the members of one group or category of people from another. Hofstede 1994 ...the set of attitudes, values, beliefs and behaviors shared by a group of people, but different for each individual, communicated from one generation to the next.

Segmentation

is the process of separating a market into groups of customers, prospective customers (prospects), or buying situations such that the members of each resulting group are more like the other members of that group than like members of other segments.

Push Strategy vs. Pull Strategy

push: Push THE PRODUCT IN FRONT OF CONSUMERS - via Trade Shows Direct selling in show rooms, store Deals with retailers Point of sale displays pull: Motivate the consumers to seek the brand, via Advertising and mass media promotions Sales promotions and discounts Customer relationship management referrals

Marketing Plan- Marketing Essentials

specify a set of marketing activities for a given period of time with the purpose of reaching certain market goals.

Situation Analysis (SWOT Analysis)

strengths, weaknesses, opportunities, threats

Perceptual Map

technique used to produce a diagram of the perceptions consumers hold about a brand/product. It is developed using statistical techniques that measure the relative importance of each object in the perception of the consumer. Maps are developed to represent particular consumer groups or markets.

Brand

the aggregation of images and feelings about a brand that reside in the memory. Brands exist only in the mind of the consumer.

Forces Favoring Global Integration

universal needs global customers global competitors high investment/technology intensity pressures for cost reduction rising productivity *economies of scale and scope *R&D investments in short life cycle products *product standardization *competitive interactions

Configuration

where in the world each activity is performed, including in how many places.