University of Iowa Introduction to Marketing Strategy Midterm 2 Spring 2020-- Nancy Abram, Marketing Strategy Exam 2, UIowa Introduction to Marketing Strategy - Midterm 2, Marketing Strategy Iowa Midterm 2 Nancy Abram

secondary internal data

*inside the firm* ex:n financial statements customer lists data warehouses and data mining

secondary external data

*outside the firm* ex: us census, internet-based reports

task oriented research

-Addressing specific decisions -New products, geographic expansion, advertising effectiveness

requirements of a market

-need/desire -ability to purchase product -willing to use buying power to purchase the product -authority to buy product

functions of packaging

1. contain and protect 2. promote 3. facilitate storage, use, and convenience 4. facilitate recycling

Positioning Steps

1.Assess the positions occupied by competing products 2.Determine the dimensions underlying these positions 3.Choose a market position where marketing efforts will have the greatest impact 4.Utilize Product Differentiation

Behavioral Segmentation

A segmentation method that divides customers into groups based on how they use the product or service. Some common behavioral measures include occasion and loyalty.

Focus Groups

A strategy to obtain data from a small group of people using interview questions

Primary Data Pros and Cons

ADVANTAGES Answers a specific research question Data are current Source of data is known DISADVANTAGES Primary data can be very expensive to acquire Takes longer then reviewing secondary data. Requires more skill and training to collect and analyze data

Pros and Cons of Differentiated Targeting Strategy

ADVANTAGES When you differentiate yourself and successfully solve a client's problem or fulfill their need, you have very happy clients. CONS: Designing specific product offerings and then customizing marketing to each customer group is an expensive endeavor. A huge challenge with differentiated marketing is developing a consistent theme and reputation for your brand.

secondary data pros and cons

ADVANTAGES: i) Quicker and cheaper DISADVANTAGES: i) Relevance, currency, accuracy ii) Rarely provides all necessary information

Pros and Cons of Concentrated Targeting Strategy

ADVANTAGES: Concentration of resources Meets narrowly defined segment Small firms can compete Strong positioning CONS: Totally dependent on a single niche market segment Segments too small, or changing Large competitors may market to niche segment

Pros and Cons of Undifferentiated Targeting Strategy

Advantages: very cost effective, low marketing complexity, reaches anyone. Disadvantages: ignores segmentation, may lead to disappointing sales, can be wasteful. Company more susceptible to competition

what we buy and need segments

Benefits Sought and Usage Rates

private-label brands

Brands developed and marketed by a retailer and available only from that retailer; also called store brands.

Stp Process Map Step 1

Establish Strategy/Goals (Which markets?) Derived from Mission Consistent with SWOT

Syndicated secondary data sources

First gather information from secondary sources *THEN* Determine what else you need, and do primary research Nielsen (http://www.nielsen.com) With itsMarket Measurement Services, the company tracks the sales ofconsumer packaged goods, gathered at the point of sale in retail stores ofall types and sizes. IRI InfoScan store tracking provides detailed information about sales, share, distribution, pricing, and promotion across a wide variety of retail channels and accounts. JD. Power and Associates Widely known for its automotive ratings, it produces quality and customer satisfaction research for a variety of industries.

nike shin guard video

Had young soccer players give them information about their product. Elite players who will use them everyday.

Pros and Cons of Micromarketing Targeting Strategy

Highly Targeted. In a micro-marketing campaign, you are getting granular. You are drilling down into the demographic to select a specific segment of the population, based on ethnicity, location, sex, interests, and even favorite foods. Cost Effective. Micro-marketing campaigns usually come with micro-budgets. That's not to say they don't cost a lot of money, but in comparison to a nationwide, hit 'em with everything you've got approach, it's way less to shell out. CONS Higher Cost Per Acquisition. While you are allocation much less of your advertising budget to the campaign, you are also targeting much fewer people than a macro-marketing campaign. It, in turn, can cause the average cost of getting a new customer to go up. Possibility of Missing the Target. As mentioned earlier, the shotgun approach of a macro-campaign is going to mean you will hit far more people than with a sniper's bullet. Micro-marketing campaigns are super-targeted...and that means it can be harder to score a bullseye.

Identifiable (segment attractiveness)

Identify who is in a market and make sure the segments are distinct

Benefits Sought Segmentation

Markets can be segmented based on the benefits that consumers desire from using a specific product

Reachable (segment attractiveness)

Must know the product exist, what it does, and how to buy it.

Profitable (segment attractiveness)

Must make sure the segment profitability is a key factor.

Substantial Segment Attractiveness

Once you identify who is in the market you need to measure the sizes.

Social Media

People are keen to give their opinions for free on social media

Experiment Variables

Products Price Package design Shelf space Advertising theme Advertising expenditures

Stp Process Map Step 2

Segmentation Criteria/Methods •Benefits Sought •Usage Rates •CRM •Demographics •Geographic •Psychographics •Occasion

Responsive (segment attractiveness)

Target the audience to the segment that can be provided by your good or service.

Stp Process Map Step 4 (Select Target Market)

Undifferentiated Differentiated Concentrated Micromarketing

scaled-response question

a closed-ended question designed to measure the intensity of a respondent's answer

Customer Relationship Management (CRM)

a company-wide business strategy designed to optimize profitability, revenue, and customer satisfaction by focusing on highly defined and precise customer groups rewards programs

decision support system

a computer-based information system that provides a flexible tool for analysis and helps managers focus on the future

warranty

a confirmation of the quality or performance of a good or service

brand licensing

a contractual arrangement between firms, whereby one firm allows another to use its brand name, logo, symbols, or characters in exchange for a negotiated fee

product line

a group of products that are closely related because they function in a similar manner, are sold to the same customer groups, are marketed through the same types of outlets, or fall within given price ranges ex iPhone X iPhone xs

data warehouse

a repository of historical data that are organized by subject to support decision makers in the organization

Cannabilization

a situation that occurs when sales of a new product cut into sales of a firm's existing products

product item

a specific version of a product that can be designated as a distinct offering among an organization's products ex iPhone x

Rebranding

a strategy in which marketers change a brand's focus to target new markets or realign the brand's core emphasis with changing market preferences

concentrated targeting

a strategy used to select *one* segment of a market for targeting marketing efforts NICHE strategy

undifferentiated targeting

a targeting strategy that approaches the marketplace as one large segment

product line extension

adding additional products to an existing product line in order to compete more broadly in the industry

product mix

all products that an organization sells ex iphone macbook ipad

in-depth interview

an exploratory research technique in which trained researchers ask questions, listen to and record the answers, and *then* pose additional questions to clarify or expand on a particular issue

Customer Lifetime Value (CLV)

approximate worth of a customer to a company in economic terms; overall profitability of an individual consumer learned how to find in discussion (ex Starbucks scenario)

brand-centric

branding is the core business competency ex nike and apple

manufacturer brands

brands initiated and owned by the manufacturer to identify products from the point of production to the point of purchase

repositioning

changing demographics, declining sales, changes in social environment

differentiated targeting

chooses *2 of more market segments* and develops a *distinct* marketing mix for *each*

4 types of products

convenience, shopping, specialty, unsought

secondary data

data previously recorded for another project

who we are segments

demographics, geography, psychographics

qualitative data

descriptive data

positioning

developing a specific marketing mix to influence potential customers' overall perception of a brand, product line, or organization in general

usage-rate segmentation

dividing a market by the amount of product bought or consumed

occasion segmentation

dividing the market into segments according to occasions when buyers get the idea to buy, actually make their purchase, or use the purchased item

Quantitative Data Collection

experiments, survey, scanner, panel

branding values

facilitates purchase •provides assurance •risk reduction self-expression differ the product •Reduces price competition •Dilutes commoditization creates loyalty family branding •Speeds introductions •Improves marketing efficiency brand equity •Awareness •Perceived Value

experimental research

gathering primary data by selecting matched groups of subjects, giving them different treatments, controlling related factors, and checking for differences in group responses

primary data

information collected for the specific purpose at hand

sampling procedure

involves selecting either a probability/random sample or a nonprobability/convenience sample as part of your sample plan

shopping products

items for which the consumer compares several alternatives on criteria such as price, quality, or style Ex: Clothing,TV

unsought products

items that the consumer does not know about or knows about but does not initially want Ex: Life Insurance

convenience products

items that the consumer purchases frequently, conveniently, and with a minimum of shopping effort Ex: Food,toothpaste

specialty products

items with unique characteristics that buyers are willing to expend considerable effort to obtain Ex: Rolls Royce

family branding

marketing several different products under the same brand name (line extension) Ex: Coke classic, Coke Zero, diet coke

product line breadth

number of different product lines

quantitative data

numerical data

Qualitative Data Collection

observation, in-depth interviews, focus groups, social media

observational study

observes individuals and measures variables of interest but does not attempt to influence the responses look at videos of people doing ordinary things

Questionnaire Design

open-ended, closed-ended, scaled-response

questionnaire data

primary asking people focus groups to surveys

observational data

primary watching people

Survey, observational study, experiment

primary research

Graphics/Labeling

providing identifying, promotional, or other important information on package labels

close-ended questions/structured

questions a person must answer by choosing from a limited, predetermined set of responses

open-ended questions/unstructured

questions that allow respondents to answer however they want

benchmarking research

retreat at intervals (trend research) awareness, attitudes, needs, etc

Demographic Segmentation

segmenting markets by age, gender, income, ethnic background, and family life cycle

geographic segmentation

segmenting markets by region of a country or the world, market size, market density, or climate

psychographic segmentation

segmenting markets on the basis of personality, motives, lifestyles, and geodemographics

STP

segmenting, targeting, positioning

loyalty segmentation

strategy of investing in loyalty initiatives to retain the firm's most profitable customers

Criteria for Targeting

substantial, reachable, identifiable, responsive, profitable geodemographic (weird website)

Micro-marketing (one-to-one marketing)

tailoring products and marketing programs to the needs and wants of specific individuals and local customer segments; it includes local marketing and individual marketing

survey

the collection of data by having people answer a series of questions Usually Questionnaires

geodemographic segmentation

the grouping of consumers on the basis of a combination of geographic, demographic, and lifestyle characteristics a mix of demographic and geographic segmentation

information reduces risk

the more information we have, the less likely we are to make a bad choice Helps Trace problems but not always accurate, timely, free, or exactly what we are looking for

product line depth

the number of product items in a product line

co-branding

the practice of using the established brand names of two different companies on the same product

data mining

the process of analyzing data to extract information not offered by the raw data alone

targeting

the process of evaluating each market segment's attractiveness and selecting one or more segments to enter

value proposition

the unique value that a product or service provides to its customers and how it is better than and different from those of competitors

spaghetti sauce video - ted talk

there is no perfect taste, everyone has their own preferences Malcolm Gladwell

targeting schemas

undifferentiated, concentrated, differentiated, micro targeting

individual branding

using different brand names for different products ex: fanta, sprite, coke

segmenting markets

what/how we buy and who we are

Stp Process Map Step 3 (Criteria for Targeting)

•Identifiable •Substantial •Reachable •Responsive •Profitable