Final Chapters- MarkeTINGZ💅🏼💅🏼💅🏼
Creative Content = Benefits Sought: "Sell the Sizzle, not the Steak" : sell benefits not attributes
- Sell product's benefits, not its attributes - A benefit should answer "What's in it for me?" - Ask "So?" to determine if advertising offers attributes or benefits
technology and channel distribution extra info
more and more: ability direct to consumer: technology has changed the way that we buy and who we buy from- sustainable/ competitive advantage and give more value
Intensive: many
o Achieve mass-market selling o Convenience goods o Tons of different outlets: competition
The AIDA Model
o Model used for use in marketing communication o Understanding consumer in their customer journey to purchase o What happens in our path to purchase o Different tools impact emotions and relationships with us/ product/ brand
Connect Promotion: connecting people
§ Form relationships through social media § Down load my app....for some swag § Encourage transparent information exchange § Customers become brand advocates § Loyalty Programs/Membership
Informative Promotion: lets people know how it works and what benefits there are
§ Increase awareness § Explain how product works § Suggest new uses § Build company image § Upcoming Event § Early in PLC
Reminder Promotion: remind people of occasion or remind that they may want this product
§ Remind customers that product may be needed § Remind customers where to buy product § Maintain customer awareness § Good for Mature Categories, Cash Cows § Reece's: want their candy at first § Office depot: cash cows: office presents in your office
Institutional Advertising vs Product Advertising
· Institutional advertising o Enhances the company's image rather than touting a specific product o Great efforts of PR · Product advertising o Touts benefits of existing product o Benefits of a specific product
Public Relations "PR"
· Performance Recognized NOT synonymous with "BS"or "spindoctoring" · Create programs & communication for multiple stakeholders about areas of interest of the organization/product. · Internal & external. · Owned and Earned Media · Go out and understand where you can do a better job- benefit to the world and be more responsible
Promotions & Brand Association Management
· Sports Marketing and Sponsorships · Cause-Related Marketing o Giving a percentage back to cause- WIB · Philanthropy o Give money to causes/ organizations · Social Responsibility o What should organizations be doing
push vs pull strategy
· Usually do both- budget, allocation of resources, effort to consumers? · Are we pushing it out? efforts for people that are trade partners- gives incentives to wholesaler · Are we pulling it out? Directly to end user or consumer o Ex: Frito Lay Chips: always on shelves: to 7-11- and also talking to consumers
Types of Vertical Marketing Systems: driven by structure: driven by who has power in the supply chain: Apple, Walmart POWER
• Reward • Coercive • Referent • Expertise • Information • Legitimate
Types of Retailers
-Hard/Soft Goods -Service
Digital and Non Traditional
- AdWords! - Banner ads - Social Media Ads (FB, Twitter, Insta) - Re-targeting- after looking for something- - E- mail - Sponsorships - Product Placement - Naming Rights - Sports Venues, Events, Athletes
Benefits of Omni Channel Retailing: Having both seems to be to maximize business, as it may be capital intensive
- Deeper and Broader Selection (not bound by physical constraints of the store) - Personalization - Expanded Market Presence
Traditional - Non Digital
- Television - Radio - Newspapers - Magazines - Books - Direct mail - Billboards - Transit cards - Subway Tunnels - Shopping Carts - Airport
Stats: Messages
-The average consumer sees 5000 messages a day. -Over 1.5 million marketing messages a year! - Few goods or services can survive without promotion. "if you build it - they don't just come" o What do we pay attention to? o With challenges: when thinking about new goods and services, very few would be successful without some level of communication
Advertising Media Placement Options
-Traditional - Non Digital -Digital and Non Traditional
Distribution centers are used for
-companies; manage inflow of freight: tasks(get things ready for sale); sometimes pricing is done at distribution center -are important part of managing the large amt of goods and supply chain systems that we have
What do we want the promotional effort to do?(about Target Audience)
-informing -reminding -persuading -connecting
Retail Format: all 6 P's need to work together to come up with overall retail strategy/mix
-product -pricing -place/distribution -promotion -personnel -Presentation
Advertising: (both strategies) (hard for people)- easier to sell something specific- right message at right time- customer journey
1. MEDIA/Delivery Strategy · Dispersion challenging for mass appeal products; Helpful to niche products · Relevance and Point in Customer Journey 2. Creative Strategy · Informational · Emotional
Designing Marketing Channels: Marketing channels- all the different ways you can push out the products to consumer
1. Sell directly to consumer 2. Go through a retailer 3. Go through a wholesaler and retailer- to get to small retailer- most of the time you have to go through wholesaler or restaurant -A lot of times, manufacturers go through all these different channels: may also want controlled systems
Advertising Appeals: what product at specific time
1. informational 2.emotional
Integrating Promotion Mix Elements
=Promotional Mix: what should I be using: depends on resources and promotional funds and who the target market is. o Social/Content Marketing? o Advertising? o Push and Pull Channel Policies o Personal Selling? o Type of buying decision: Where in the customer journey? o Nature of the Product: Stage in PLC of Category o Public Relations? o Sales Promotion? o Characteristics of the Target Market
The AIDA Model
Create: 1. Awareness 2. Interest (informational promotion) 3. Desire (emotional appeal) 4. Action (act and buy through personal sales and sales incentives and promotions, and membership programs)
Levels of Distribution Intensity o How intensely do you want to be distributed
Intensive, Selective, and Exclusive
Trader Joe's
Trader Joes differentiates its store experience through: • Small, easy to navigate store • And edited assortment featured new and different items • Whimsical décor • Superior levels of customer service • Competitive basket level pricing • Highest sales per square foot • Small footprint • Carry no private brands
Retailer
a channel intermediary that sells mainly to consumers
wholesaler
an institution that buys good from manufacturers, takes title to goods, stores them, and resells
Identify Product Benefits: Propel
attribute and product
Buy from manufacturers then resell to retailers
common in restaurant business/ sporting goods: create more utility: example Nike: go through wholesaler and place order for items- small manufacturers and retailers
Add Value by
creating our product more efficiently, delivering it to customers more efficiently, and making it available where they would like to have it more efficiently. This takes into account all of the systems that we have in place, getting the materials and things we sell to add value to consumers, and the channels that we use to get the products to the consumer
these supply chain systems domestically produce food and internationally sources toy products are very different: how to have both:
different steps
Promotion IMC
is generally how promotion referred to: there are lots of tools to make this happen: social media, public relations, advertising, owned media, annual reports, influencers/spokespeople 1. The communication you have about your brand 2. The incentives you offer people to buy now 3. The way you connect with them (through apps and loyalty programs for long term sales and for loyal customer acquisition and use)
Is promotion ok?
o Advertising and promotion have often been under criticism o Is advertising deceptive? Can't lie in ads. o Does it increase prices of our goods? o If we didn't advertise, would they be cheaper? o Does it create needs that we don't have? o Make us desire things that aren't good for society? o Does promotion encourage materialism? o What should and shouldn't be advertised? o Nicotine? Alcohol? o Should politicians be able to advertise?
Strategy and Processes for Supply Chain Systems: Examples of how these different stores handle supply chain: work in strategy: business strategy
o Aldi: mega discounter: limited assortment: private label products: demand for items is predictable: don't put things on sale: EDLP: consistent supply chain: United States o John Deere: original equipment: items made somewhere else- put parts together and available at their dealers-contractual relationships with their dealers o Von Maur: apparel: no private label: somebody else manufactures: fashion: need lots of different buyers: knowing latest trend: Products produced in Italy, South America: at Market, it comes in many different places
o Presentation (taken over by technology/ self-checkout)
o Atmosphere, Layout, Site Design § Way you merchandise the goods § Warehouse or comfortable? § Present retail format Place it on
informing
o Awareness o New Uses for product o Events o Image enhancement
examples: channel conflict
o Bottled Water: Dasani vs Aquafina § Coke: Kroger grocery stores- take out Aquafina store- if you don't sell our water, you cant sell our chips o Goodyear tires: because sears added things, they needed to make it more available- Horizonal/Vertical conflict
Setting the Marketing Communications Mix: Buyer-readiness stage customer journey
o Closing the sales and incentives: o Awareness o Comprehension o Conviction: have desire to buy product o Order o Reorder
o Personnel (taken over by technology/ self-checkout)
o Customer Service and (how much) Personal Selling o Service level o Large important put on service
persuading
o Encourage Switching o Change perceptions o Influence immediate buying o Call/visit website NOW
Private Label Growth
o Growing at nearly 8x that of national brands o More and more retailers that: are specific and go with positioning- create brand cheaper than buying it from provider o Have to have a good label of scale o Power of Retailers- THEY HAVE THE DATA o They know what people buy: access people by that o Create products that are unique but take on the benefits and characteristics of national brands o Retailer loyalty o Unique offerings o Vertically Integrated Companies & Processes o More seamless SCM o Copycats, Premium, o Benefit Based (organics)
Media Types- Digital
o Growing: on computers and phones: most of IMC o Loss of control: more one on one communication: people have ability to give reviews o Co-creation: ask them questions, people answer, and we take feedback o Three types of assets: o Owned Media: not a paid ad: own media representing what brand/product is about o Websites o Blogs o Social Media Presence o Paid Media: pay for time and space to be communicated o Banner ads o Sponsored posts o Influencers to talk about product o Search Engine Advertising o Earned Media: "buzz" other people talking about us: what other people say about our brand: media in general talks about you o Media Coverage o SEO: search engine optimization: come up high in search results o Social Media posts o WOM: Word of Mouth: people sharing and talking
Just in time or Quick Response Systems: Technology for Stocks
o Have them to reduce lead time for consumers: we want everything now o Common in place now: in fashion industry: Zara video notes (start 1:10) o If have JIT, you can reduce your investment in inventory and increase availability -Less invested in inventory: better return on investment o In order to manage inventory: aid into quicker response systems and better ROI -UPC codes- Uniform Product Code: quick to track inventory -RFID- Radio Frequency Information Devices- sensors on product- easier to use tracking inventory, taking inventory, and managing stock -EDI: Electronic Data Interchange: technology to share info with retailers: seamless between sellers and resellers: replenishment process is simple -VMI: Vendor Managed Inventory: convenient store- bottles from PepsiCo: manufacturers work inside the retailer and manage stock
Every communication point with consumers and stakeholders- Personification
o How you paint your trucks o Packaging and Logos o Website and print materials o Retail Atmosphere, CRM o Ads/Sponsorship/Product Placement o Grapevine, Twitter, Reviews, Blogs o Community Involvement
o Deeper and Broader Selection (not bound by physical constraints of the store)
o If someone that's selling consumer goods today, you need to be omnichannel § Online: not bounded by physical requirements of store
o Expanded Market Presence
o Increased share of wallet from category o Constant connectivity § Expands market presence § Wayfair: all online: tons of goods
o Place/ Distribution
o Location, Hours, Channel Strategy § how to serve the overall broad market § Example: restaurant: McDonalds: locate for every 10,000 consumers § Not about where to sell, but where am I making large capital investments to serve the market § Hours of operation
Pricing:
o MSRP (manufacturer suggested retail price)/HiLo/EDLP/Discount/Markdown § Has a lot to do with their positioning in the marketplace § Example: Scheel's: primarily: MSRP: not discounted § Example: Walmart: EDLP
reminding
o Maintain awareness o Reinforce learning o Where to buy o Stimulate needs
Dominos Supply chain- The DC- Video Notes
o Make the dough- and then to retailers- then to the stores
Product:
o Merchandise Width Depth § how broad is merchandise going to be? § Walmart: four or five bikes: specialty has narrow width of assortment § large variety seller, you have a lot more categories: how many categories am I going to carry- in my retail format § based on target audience o Manufacturer or Private Label § Am I going to buy manufacturer's brands or am I going to have a private label, or a mix of both? § Example: value segment- Costco has manufactured brands and private label: Trader Joe's has almost all private labels
Overview: Retailing and Omnichannel marketing
o Most dynamic and quickly changing areas of consumption behavior that we've seen in the past 30 years o There are many different retail formats o Omnichannel selling o Private label goods o Vertically integrated systems: retailers are buying back in the supply chain and manufacturers are buying forward into supply chain to satisfy cons wants and needs and give a larger share of incomer profits from those channels o Retailing: All the activities directly related to the sale of goods and services to the ultimate consumer for personal, non-business use. o Fast moving and dynamic o Human behavior and consumer behavior: how we buy and where
Example of Supply Chain and Channel Management- Hellman's Mayo
o On left side, is everything that goes into product: eggs, container (efficient and effective management of these is about the supply chain) (lowest price for jars, make sure you aren't waiting around for eggs/oil) o Right Side: Food wholesalers: bring it to grocers- could sell directly to wholesalers who sell to small businesses, sell to Walmart, or straight to Marriott hotels- There are several different channels o Convenience goods: available through lots of outlets! o Supply chain on left- then channel management on right
Brick and Mortar:
o Over 90% of Retail Stores o For online sales: they are growing o Right: Online sales is only about 10% of overall sales: mostly in-store: delivery and click-and-collect o Depends on category: food and petroleum is in store
o Personalization
o Personalized customer service (online chats) o Personalized offering § Gathered data, username, who they are, make better personalized offerings, with memberships, can meet wants, needs, and desires are
Retailing isn't about what you buy, about where you buy and whom you buy from
o Product distortment is important: we see vertically integrated private label only stores: where they manufacture most of their own products: gives them competitive advantage with unique merchandise o Costco and trader Jo's o Where are we going to buy? Lots of choices o Retailers: be your outlet of choice: apparel and appliances o Supply convenience and connectivity
Warning: Promotion (Ad)
o Promotion cannot solve product, price (value) or distribution problems! o It supports sound product, pricing and distribution strategies o Most of the time, you can't come up with an ad that helps the product issues
Promotion
o Promotional Strategy § Connect with people (4ps) § Advertise? Not advertise? Starbucks doesn't advertise o Advertising/SEA, Partnership/Promotion, Price Promotions, Goal- Traffic- Site/Store
connecting
o Relationships via Social media o Loyalty programs o Visit website o Transparent Exchange
Reverse Logistics Video Notes: Amazon
o Reverse logistics: returns: do people pay to ship it back to Amazon? o Amazon is handling it in different ways o Is now becoming more problematic
Li & Fung: The World's Largest Global Contract Manufacturing Company
o Sources products o Find factories that can produce them o Store and hold products and maintain logistic systems o Don't own factories- they access and utilize o Lack of ownership- help investment- keep them flexible in supply chain
What do consumers buy?
o Take a look: when wondering what retail environment and landscape you want to be in, interesting to look at our disposable income as consumers o Food: 33% essential good: most o Petroleum and Transportation o Housing: per capita consumption o When thinking about retail, we think about malls and apparel o We have seen compression at 10% level: because of online shopping o Give people level of convenience and omnichannel
Integrated Marketing Communications (Plan): a tangible representation of brand and identity
o Takes in every communication point with stakeholders and consumers> o Be careful with everything that you say and do
The future of retail involves-YouTube Videos Notes
o Technology o Beacons: better segment customers and advertise accordingly o Facial Recognition: o Robot Assistants o Smart mirrors o Auto Checkout o taking a look at the current formats that we have and changing them
Generally- It is all Communication When thinking about marketing communication- IMC: it is a communication platform
o The Source of the advertising people come up with o A Message (information, emotional, social) o Goes through communications channel to send it to us o We send it through our perceptions- we decode message based on our experiences and beliefs o Receive the message NOISE through communication process: multitasking, other people in marketplace
Role of Promotion in the Marketing Mix- laser focus on target market
o Thing to do last o Where do I see a market? o How do I put together my objectives? o Then, what is the marketing mix? o Promotional mix: How do we get to these people? o All go hand and hand into: Integrated Marketing Communication Promotional Plan (IMC Plan)
Overview: Promote our brand or our promise that were giving to consumers
o We do last, even though in consumers' minds, they think of it first o We utilize communication tools to do this o Loyalty and connectivity gives to levels of advantage: it's the basic values of the product that give it value
E-Commerce Continues to Drive Retail Growth
o What categories and what their growth is in ecommerce o High levels of selling being online for books and technology o How they shop, how they buy, and what path to purchase o Potentially shop online then go to store and buy. Vice versa
Levels of Service
o When you're a retailer, you have to think about what level of service we're going to offer and what level of self-services o Has a lot to do with how you position the brand o How much are we identified? Great and full service or having great prices? o Full Service: Sacks Fifth Avenue: help and wait on you o Drive costs higher o Moderate level: Kohl's o Self Service: Costco
Selective: Several
o Work with selected intermediaries o Shopping and some specialty goods o Certain products not sold at Walmart o Selected wholesalers
Exclusive: One
o Work with single intermediary o Specialty goods and industrial equipment o Vertical integration: certain: car dealers for example
Cost Drivers of the different channels Which Channel is most profitable? Depends: all have different cost structures: depends where you started
store, web, mobile
Persuasive Promotion: convince people of attitude or belief: emotional: change attitudes
§ Encourage brand switching § Change customers' perceptions of product attributes/use § Influence immediate buying decision § Persuade customers to call/visit website/go to store § Good during growth stage of PLC § Verizon: demonstrates proof that Verizon is better § Sabra hummus: convince men to eat the hummus § Laser and micro typed format
IMC Elements and Tools:
• Advertising - Good at creating awareness and interest Controlled messages through a paid channel • Public Relations- Programs to influence stakeholders, free media attention and social shares. • Sales Promotion - Incentives, consumer and trade • Personal Selling - Most expensive form of IMC. Good for complex, high end products: large quanities • Direct Marketing - mail, e-mail, mobile, utilizes CRM and databases: know we have good connection with consumer and can reach them effectively: know where they are in customer journey
Advertising
• Advertising is: Paid, controlled communication. From a sponsor, manufacturer, retailer or organization • Create message and control it: created by manufacturer: pay to push through channel: what channels? • Through a variety of media channels • Media and creative strategy • Expenditures continue to rise, 6.2% increase in 2019, $672 Billion • Channels shifting
Informational
• Benefits Provided • Profit/Affordability/Price • Green/Environmentally Friendly • Convenience • Event Information
Franchises and Contracts:
• Bought into retail concept: buy from owner and manufacturer
store
• Bricks and Mortar, Salespeople • Attracting Customers to Store • Distribution Centers • Restocking Returned Merchandise
Fun Meal Toys/Premiums (takes longer)
• Deal with Movie/Brands: Meet with Paramount about deal- "summer deal with movie" • Approved suppliers • Designers: what would design be • Brokers: Leon Funk: and factories- get them manufacturers • Factories • Logistics • Financing- 25 cents • Push distribution: make decisions that every store would sell 120 of them- • Seasonal/Fad- short amt of time- hope to move through it -Fashion merchandise or toys- selling season
Hard/Soft Goods
• Department Stores: Macy's/Dillard's: don't have a lot of unique goods • Specialty Stores: Growth: Lululemon: specialized • Supermarkets: Hy-Vee: compression and discounters: Trader Joe's: Walmart is 25% • Discount Stores • Drug Stores: • Convenience Stores: restaurant business • Extreme Value: growing: Dollar General • Off-Price: Home goods: growth
web
• Distribution centers and fulfillment centers • Photography of products- visual credentials and product descriptions • Building, Refreshing Web Site • Attracting Customers to Site • Picking, Packing, Mailing Small Orders to Home • Restocking Returned Merchandise • No low cost of entry as assumed
Technology and Channel Disruption
• Entertainment - Disney +, Spotify, Netflix, Cable: not going through cable anymore • Shopping-Amazon and Delivery: directly to consumer • Hospitality/Travel - Priceline, Travelocity: aggregators vs travel agents • Driving- Air BnB, VRBO, UBER, Lyft: different transportation options other than taxis
Emotional
• Fear/Safety • Humor • Status/Display of Wealth/Affluence • Happiness & Comfort • Love/Sex Appeal • Nostalgia
Channel Conflict: all stages and places
• Horizontal (didn't get a good enough deal), vertical • Channel conflict: Up and Up: own private label: there's manufacturers have disenchantment • Exacerbated with Private Label • Manufacturers drive for favorable arrangements in distribution • Retailers need margins and consumer traffic • Where does power lie in the supply chain?
Benefits of Effective Supply Chain &Marketing Channel Management
• Keep inventories low- move it quickly to consumer: to increase customer value and cash flow: adding value • Find the way you can leverage the supply systems coming in, and utilizing them to create higher revenues • Lower inventory, transportation, warehousing, and packaging costs • Improved customer service • Higher revenues • Increased performance and profitability • Greater supply chain flexibility • No stock outs
mobile
• Location enabled tech • Apps • Same as Web for goods • Mobile sites • Integration with social • Services - App critical • Tickets • Notifications • Beacons • Growing most
Car Dealers and Bottlers
• Nissan deal and bottles are vertical- official
How Much Should We Spend?
• Objectives and Required tasks: what do we want to get done- what's the cost • BUDGET: formed from past year • Percent of sales • Match competition: what competition is doing • Arbitrary decisions • Combination of above
Product Placement & Sponsorship
• Placement estimated globally at $56 Billion • Sports Sponsorship $ 75 Billion • Event signage, promotions, naming of portions of game, course, stadium, teams, (racing) • associate with winners; • local favorites, male audience • Naming rights: named after someone?
Fill Out the Creative Brief: so other people can make good advertisments
• Problem to be solved by the communication:why are we doing things • What do we want the communication to do, inform, increase awareness, remind, persuade, incite action, create an emotional appeal, send target to website, drive retail traffic, remind, support brand position? • Brand positioning and Personality: conservative? Powerful?- tone • Target Market: who are we directing toward • Benefits to target, unique selling proposition: what benefits? • Key Idea/Appeal (fear, ego, savings, image, convenience, value, - articulate the idea and understand the appeal) • Why should the target believe this? (permission to believe, support points)- testimonials • Executional considerations and details (color, logo, addresses required etc)
Media Selection Criteria: how do we select the media?Target Audience
• Reach (% of target exposed to message) - Gross Rating Points (GRP's) • Frequency (how many x's) - Effective Frequency is 3-7 times in 4 weeks • Cost per contact (or 1000)/Cost per click (CPC)- how much am I paying for the click • Media flexibility- easy to work with - time it at different times • Noise Level- how much interference- • Metrics and Measurement - Analytics for Digital to determine impact and ROI: audited by audit bureaus • Media Scheduling - Continuous, Flighting, Pulsing: plan sale out
Marketing Channels Add Value: They create time, place, and exchange utility
• Reduce number of transactions/touchpoints • Go out and buy assortment of goods • Increase value for consumers • Break bulk (don't have to buy 12 at a time), provide assortment, hold inventory, provide services • More efficient and effective • Get product when and where we want and quantity
Supply Chain Systems- Hardee's: TASK: Food: create new chicken tenders product
• See Tyson/Perdue: see people that are competent in food industry • Develop Product: understand the specifications • Specification: "breaded this way" (specify what is in these chicken tenders) • Manufacturing plants approved (more than 1): (if one has contamination or fire, you need ongoing supply) • Use pull ordering: as a store sold them, this is electronically recorded- utilize logistics: as stores order them, we produce more- based on what is ordered at store level • Logistics Staple product
Marketing Channels Reduce the Number of Required Transactions
• When we go to one retailer, it saves time • More efficient • Going to retailer with broad assortment makes it easier for us
The Distribution Center- maze of conveyer belt
•Managing inbound transportation •Receiving and checking using UPC or RFID •Storing and Cross-Docking •Getting Merchandise Floor-Ready •Preparing to ship •Shipping to store
