Marketing Module 5

Evaluate and reposition

Every good marketer knows that you have to keep your eye on the competition. You must continually evaluate what is happening in the marketplace and reposition your product when necessary. Products are often repositioned as the company and competitors launch new products and versions. What is originally launched as a high-end brand sometimes makes its way down the chain and ends up with discount or warehouse retailers as new products are released. When the Quartz shower was launched by Aqualisa in the , it was a high-end product sold only through showrooms. As the company developed other products, some of the original Quartz products were rebranded and sold through chain DIY stores. Because the product was naturally repositioned as a result of the launch of new products, associated marketing efforts were also adjusted to reflect the new position.

A car company that only makes blue cars is an example of differentiated marketing.

False

All customers are created equal.

False

The share of a customer examines the lifetime profit that is expected to be generated from each customer.

False

Choose features and Services

Specific features and services to offer is another step in a company's positioning and differentiation strategy. For example, a business may choose to differentiate themselves as a good option for money saving or, on the other end of things, as a company that concentrates on luxury. Wal-Mart is a classic example of a low-cost leader. It provides a large range of products to its shoppers at prices that are generally substantially lower than its competitors. Lexus also provides features that lead to a competitive advantage, which offers exceptional levels of after-sales service to its customers, including comfortable and upscale waiting rooms in which they can relax while their car is being serviced.

Granting customers the opportunity to place personal orders for birthday cakes is an example of customized marketing.

True

Small market segments can be profitable for companies.

True

Someone who frequently calls customer service for assistance but still purchases several phone and Internet plans is considered a valued customer

True

The 80/20 rule tells marketers that 80% of their revenue is generated by 20% of their customers.

True

segmentation

grouping people with common characteristics together.

Differentiation

is a marketing strategy based on what makes a product or service unique and different from its competition.

Three ways to evaulating segmentation

1 Marketers try to size the segment to get an idea of how big it is. If a segment is too small, a company might be concerned that it won't be profitable enough. 2 Marketers evaluate whether the segment is growing or shrinking. A growing segment offers opportunities for profit making. 3 Marketers analyze the levels and types of competition in a segment.

Forms of Customer relationship management

A letter, phone call, or email from the optometrist's office telling you that it has been a year since your last appointment A coupon from your favorite store that offers you 10% off your next purchase A new-product announcement informing you about a computer upgrade A birthday card from your bank that wishes you a great year

Demographic Segmentation is broken into 6 categories

Age Gender Income Family Life Cycle Ethnic Orgin Location

Demographic Segentation

Dividing the market into segments based on variables such as age, gender, family size, family life cycle, income, occupation, education, religion, race, generation, and nationality.

Differentiated marketing is designed to appeal to as many people as possible

False

Choose marketing elements

Once you have assessed the competitive situation and have determined your competitive advantage, you must determine pricing, promotional, and distributional elements. These elements must be in line with and support the positioning strategy. For example, consider the jewelry store Tiffany & Co. This high-end jeweler prices its jewelry at a premium, only sells its jewelry through Tiffany & Co. stores, conducts select promotional campaigns, and sells unique, high-quality pieces. These marketing elements position Tiffany & Co. as one of the world's premier jewelers.

A company that designs shampoos and gels for people with thinning hair is an example of concentrated marketing.

True

A store sending out coupons to their frequent customers is an example of a customer relationship management approach.

True

Four Targeting Strategies

Undifferentiated marketing Differentiated marketing Concentrated marketing Customized marketing

Anaylize and Evualate the Competition

What promises do the competitors make? What features do their products have? What offers and promotions are they selling? Let's consider the bottled water industry as an example. In addition to spring water, there are now vitamin waters, flavored waters, and more. If you are planning to offer a new product in this category, you need to have a full understanding of the range, features, and benefits of products already available to consumers.

Target

`means to decide the segment on which the marketing division wants to focus.

Positioning

is a marketing strategy that revolves around how a company wants their product or service to appear when compared with its competition.

Customer relationship management (CRM)

is about using software programs and computers to track and organize details about customers. Each company has a different way of approaching, recording, and accessing these data, depending on its scope and the type of industry.

Undifferentiated marketing

is the best option when trying to appeal to a large number of people at once, for example, marketing staple products such as sugar. Undifferentiated marketing is designed to appeal to as many people as possible. This strategy is similar to mass marketing, in which companies believe there are no differentiating characteristics in the products people buy and the ways in which they buy them. Undifferentiated marketing can profitable because production costs are lower compared with other targeting strategies. The classic example of undifferentiated marketing is Henry Ford's Model T. A customer could get any color they wanted as long as it was black. Today, many staple products (such as salt and sugar) are marketed using an undifferentiated strategy.

Concentrated Marketing

is used when a company offers a variety of products for a particular segment, such as a cosmetics company. Using concentrated marketing, companies evaluate and select a segment, then offer several different products for that segment. Take Nioxin, for example. This product line consists of foams and topical solutions of various strengths, as well as shampoos and conditioners. All Nioxin products are targeted to individuals concerned about the same thing: thinning hair and hair loss.

Customized marketing

is when customers decide what they want in a product and the company fills that order, for example, an online pizza-ordering and -delivery service. Customized marketing is when customers decide the specifications of the product they want, and the company makes it to order. A classic example of customized marketing is Dell; customers specify the exact components they want in their computer. A more simple example is a bakery. The baker makes cakes according to the specific wishes of each customer, including cake flavor, icing flavor, and design. In practice, customized marketing can be impractical because it takes a great amount of resources to create specific products for a large number of individual customers.

Differentiated marketing

targets a distinct segment of people, such as those who wear glasses. Differentiated marketing involves looking at the marketplace, identifying segments that are homogeneous, evaluating each segment, and deciding which segments the company is best suited to target. The company then develops distinct offerings for each segment. Consider the market for eyewear. There are high-fashion glasses, functional glasses, glasses for teens and children, and glasses that support different types of vision. Each of these product lines targets a distinct segment.

Psychographics

which uses psychology and sociology to identify and understand market segments