Marketing Framework PDF

Marketing framework Depending on the entities participating in the value exchange, there are three main types of markets: business-to-costumer, business-to-business, customer-to customer. Marketing is about creating value by designing and...

Marketing framework Depending on the entities participating in the value exchange, there are three main types of markets: business-to-costumer, business-to-business, customer-to customer. Marketing is about creating value by designing and managing viable marketing o erings. Identify value (ful ll unmet needs better than competitors) -> design value (product, brands, price)-> communicate value (inform customers collaborators employees stakeholders) -> deliver value (distribution channels). To create value, a company must identify the target market. Market value map follows the structure of the business model and comprises 3 components: target market, value proposition, market o ering. Marketing myopia: there are 4 main factors that contribute to this myopic view of the future: -focus on product rather than on customer needs that is product aims to ful ll -think that growth is assured by market expansion -believe there is no substitute for the industry product -overemphasis on the importance of mass production and the bene ts of economies of scale. Le aziende non vedono i cambiamenti nel mercato e non colgono nuove opportunità. Marketing myopia: focus on product rather than on customer needs ful lled by the product, think that growth is assured by market expansion, believe there is no substitute for the industry product, overemphasis on mass production and economies of scale. De ning the market through the company products is myopic. The market is de ned by customer needs. Framework facilitates decisions in several ways, they help identify approaches to thinking about the decision task, thus providing managers with a better understanding of the problem they are trying to solve. The target market: it is the market in which a company aims to create and capture value. The target market is de ned by ve factors: customers whose needs the company aims to ful l, competitors that aim to ful l the same needs of the same target customers, collaborators that work with the company to ful l customer’s needs, the company managing the o ering and the context in which the company operates. Strategies are di erent from tactics. Target customers are de ned by two factors: needs and pro le. Customer needs re ect the speci c problem faced by the customers that the company aims to address. Customer pro le re ects customer’s observable characteristics.demographics, geolocation, psychographics, behavior. Competitors: they are entities that aim to ful ll the same need of the same customers as the company. Because the success of a company’s o ering hinges on its ability to create superior customer value, identifying the competitive o erings that customers will also consider when making a choice is essential to a company’s ability to gain and defend its market position. Without knowing who the competitor are and what bene ts they o er to target customers, it is di cult fora company to design an o ering that will successfully provide superior value. Collaborators: they are entities that work with the company to create value for target customers. Selecting the right collaborators is paramount for the company to compete in the chosen market. Company: it is the entity that develops and manages a given market o ering. Context: it describes the environment in which the company operates. It is de ned by 5 factors: sociocultural context, technological, regulatory, economic, physical context. Marketing plan: actionable, relevant, clear, succinct. Marketing planning and management can occur on two levels. They can focus on analyzing, planning and managing the company or they can focus on analysing, planning and managing one or more of the company’s o erings. A key fl fi fi fi ff fi ff fi fi fi fi ff fi ff fi ff ff fi fi fi ff fi fi fi ff ff ff ffi fl fi fi  aspect of company planning and management involves dining the company culture, values, mission and vision. Company culture re ects the shared values and beliefs, a company’s mission is a clear, concise goal that provides company employees and management with a shared sense of purpose. Company’s vision de nes what the company will look like in the future. Company planning and management also involve assessing the company’s market position (using SWOT analysis) and developing a strategy to strengthen each business. From the point of view of designing a particular o ering, market planning is a process de ned by ve main steps: setting a goal, developing a strategy, designing the tactics, de ning the implementation plan and identifying the control metrics to measure the progress toward the set goal. The rst step in de ning a marketing plan is to understand the company culture and values. By culture we mean there are shared values, beliefs and norms, code behavior. The culture will impact on language, dress code and so on. Company culture is a re ection of their values. Core values: moral principles that guide the company, independent of the economic or competitive environment, they must stand the test of time. The 3C framework suggests that to achieve a sustainable competitive advantage a strategist should focus on three key factors: the corporation, customer and the competition. The 3c framework suggests that managers need to evaluate yield marketing environment in which they operate. The 3c framework has some limits that is for example the cvompanyu’s collaboratoprs and the context in which they operate. Many of the shortcomings of the 3c framework are overcome by 5c framework. When these 3cs are taken into account, a business strategy can be developed. By understanding these 3 factors and integrating them into a strategic framework, the company can achieve a competitive advantage. The 3V market value principle: creating value for all relevant entities involved in the market exchange is the overarching principle that guides all company actions. the market value principle implies that when developing market o erings, a company needs to consider all 3 types of value:customer, collaborator, company value. Company value (what values does the o ering crate for the company), collaborator value ( what value does the o ering create for the company’s collaborators), customer value (what value does the o ering create for target customer). The 5c framework: Small and medium-sized businesses often use the 5 C’s analysis to understand the complex interconnections of systems in which their company is engaged. The 5 C’s of marketing analysis are: 1. Company: The company section focuses on many of the internal factors related to the marketing and sales of your products and services. Some key elements include: Brand image, Competitive advantages, Goals,Products. 2. Customers: The customers section sheds light on the people who buy your products or interact with your services. Factors to consider regarding this segment include: Communication channels Customer behavior, Customer motivation, Customer perception, Target audience. 3. Competitors: The competitors section emphasizes those individuals and organizations to which your company is highly comparable in the market. Factors include: Compatibility gap Competition strategies and tactics, Competition strengths, Competition weaknesses, Emerging competition, Established competition. 4. Collaborators: The collaborators section focuses on every individual or organization that works to create, produce, promote or sell your products or services. Categories include: Content creators, Distributors, Investors, Partnerships, Service providers,Suppliers. 5. Context:concentrates on external factors that aren't controlled by your own business. Some elements are: Economic trends, Laws, Regulations, Social and behavioral trends, Technologies. Seven attributes de ning the market o ering: product, service, brand, price, incentives, communication, distribution. These attributes are also referred to as the marketing mix. These 7 tactics de ning the o ering are also the tools that managers have to create market value. fi ff fi ff fi ff fi ff fi fl ff ff ff fi fi fl fi Marketing goals: setting a goal involves 2 decisions: identifying the focus and de ning the benchmarks. -focus: -monetary -non-monetary -benchmarks: -quantitative -temporal The target market strategy: the rst step is to identify the target market where to create value. A common mistake is to overlook strategy an confuse marketing with tactics. Company + collaborators + competitors + customer al centro. A common mistake is to overlook strategy and confuse marketing with tactics. Identify the target market in which the company will launch its new o ering: customers, collaborators, company, competitors, context. Value proposition: de ne the o ering’s value proposition for target customers, collaborators and the company: customer value proposition, collaborator value proposition and company value proposition. The value proposition de nes the value that an o ering aims to create in a given market, it re ects the bene ts and costs of the company’s o ering. Creating a value for all relevant entities involved in the marketer exchange is the principle that guides all companys’actions. The market value principle implies that when developing a market o erings, a company needs to consider all 3 types of value: customer, collaborator, company value. Target customer: what are the needs and pro le of... customers? Competitors: create superior customer value, de ne based on customer needs- Company: goals resources. Collaborators: complementarity of resources. Five forces: the ve forces framework o ers an industry-based analysis of the competition and Is often sed for strategic industry level decisions such as evaluating the viability of entering or exiting a particular industry. So, competitiveness is determined by ve factors: the bargaining power of suppliers. The rivalry among existing competitors, te threat of new entrants, the bargaining power of buyers, the threat of substitute products.this is industry focused, whereas 5Cs is centred on customer needs. (Porter) il 5f framework analizza la concorrenza sul mercato ed ha delle cose in comune con il 5c framework (Company, collaborators, customers, competitors, context, modello centrato sul cliente). The market plan: to guide A company’s actions, we need to delineate company’s goal, inform the stakeholders about the goal and persuade the relevant decision market. Company culture and value: the rst step in de ning a market plan is to understand the company culture and values. Company culture: re ection of the core values that a company has embraced, shared values, beliefs and norms; codes of behaviour; not expressly de ned. Impacts on language, dress code, look and feel of o ces and products. Core values: moral principles that guide company actions, independent of the economic or competitive environment, they must stand the test of time. AMAZON (JOBS) – LEADERSHIP PRINCIPLES CUSTOMER OBSESSION Leaders start with the customer and work backwards. They work vigorously to earn and keep customer trust. Although leaders pay attention to competitors, they obsess over customers. OWNERSHIP Leaders are owners. They think long term and don’t sacri ce long-term value for short- term results. They act on behalf of the entire company, beyond just their own team. They never say “that’s not my job." INVENT AND SIMPLIFY Leaders expect and require innovation and invention from their teams and always nd ways to simplify. They are externally aware, look for new ideas from everywhere, and are not limited by “not invented here." As we do new things, we accept that we may be misunderstood for long periods of time. LEARN AND BE CURIOUS fl fi ffi fl fi fi ff fi fi fi ff fi fi fi fi fi ff ff fi ff fi ff fi  Leaders are never done learning and always seek to improve themselves. They are curious about new possibilities and act to explore them. THINK BIG Thinking small is a self-ful lling prophecy. Leaders create and communicate a bold direction that inspires results. They think di erently and look around corners for ways to serve customers. BIAS FOR ACTION Speed matters in business. Many decisions and actions are reversible and do not need extensive study. We value calculated risk taking. FRUGALITY Accomplish more with less. Constraints breed resourcefulness, self-su ciency, and invention. There are no extra points for growing headcount, budget size, or xed expense. EARN TRUST Leaders listen attentively, speak candidly, and treat others respectfully. They are vocally self- critical, even when doing so is awkward or embarrassing. Mission: de nes the reason why a company exists, the main goal value driven ling term view succinct. A mission is a clear, concise and enduring statement of the reasons for an organisation’s existence. Vision: de nes what the company will look like, what to become source of aspiration an image of the future. Swot framework: useful to asses a company’s market proposition. STRENGTHS: ACCESS TO SCARCE RESOURCES, KNOW-HOW, PATENTS, STRONG BRAND,... WEAKNESSES: DISLOYAL CUSTOMERS, WEAK BRAND,... OPPORTUNITIES: NEW CUSTOMERS, GENERAL ECONOMIC GROWTH,... THREATS: NEW COMPETITORS, INCREASED PRODUCT COMMODIZATION, BUYER POWER. ——> A GOAL IS THE ULTIMATE CRITERION FOR MEASURING SUCCESS. The individual components of the G-STIC framework: goal, strategy, tactics, implementation and control. Goals setting: de nes the focus of company actions and the performance benchmarks. Focus: monetary, strategic. Benchmarks: quantitative, temporal. Company goal include: customer, collaborator, company, competitor, context objectives. A comparison with older frameworks: many frameworks are possible, a famous one is the 4p (McCarthy, 1960s). Evaluate performance: a key performance indicators is a measurable value that demonstrates how e ectively a company is achieving key business objectives. Not only evaluate performance gaps but also monitor the environment for opportunities and threatments. KPI = key performance indicator = sono quelle metriche, o indicatori, che servono a misurare i risultati oggettivi, ovvero l'e cacia e l'e cienza, delle iniziative di attrazione e conquista di un cliente, l'acquisizione di contatti, il livello di soddisfazione e ingaggio, la qualità dell'esperienza, il ritorno degli investimenti. Ogni KPI deve essere SMART. Questo è un metodo semplice ma e cace: Speci c (speci co) Measurable (misurabile) Attainable (accessibile) Realistic (realistico) Time-based (limitato nel tempo) The G-STIC framework stands for: Goal, Strategy, Tactics, Implementation, Control. An o ering's marketing plan can be de ned by ve key activities: setting a goal, developing a strategy, designing the tactics, de ning an implementation plan, and identi-ring a set of control metrics to measure the success of the proposed action. These ve activities comprise the G-STIC (Goal- Strategy-Tactics-Implementation-Control) framework, which is the cornerstone of market planning and analysis. fi ff fi fi fi fi fi fi fi ff fi ffi fi ffi fi ffi ffi ff  The goal identi es the ultimate criterion for success that guides all company marketing activities: Setting a goal involves two decisions: identifying the focus of the company's actions and de ning the speci c quantitative and temporal performance benchmarks to be achieved. The strategy outlines the logic of the company's value-creation model. De ning the strategy involves two decisions: identifying the target market and developing the o ering's value proposition. Identifying the target market involves identifying ve key factors (the Five Cs): customers whose needs the company's o ering aims to ful ll, the company managing the o ering, collaborators working with the company on this o ering, competitors with o erings that target the same customers, and the relevant context in which the company operates. The value proposition, on the other hand, de nes the value that an o ering aims to create for the relevant participants in the market-target customers, the company, and its collaborators. The development of a value proposition also involves the development of a positioning that singles out the most important aspects) of the o ering's value proposition to create a distinct image of the o ering in customers' minds. The tactics outline a set of speci c activities employed to execute a given strategy. The tactics de ne the key aspects of the company's o ering (often referred to as the marketing mix): product, service, brand, price, incentives, communication, and distribution. These seven tactics are the means that managers have at their disposal to execute a company's strategy and create the optimal value proposition for the target market. The implementation outlines the logistics of executing the company's strategy and tactics. De ning the implementation involves three key compo-nents: de ning the business infrastructure, designing business processes, and setting the implementation schedule. The control de nes criteria for evaluating the company's goal progress. Control involves two key processes: evaluating the company's progress toward its goal and analyzing the changes in the environment in which the company operates. The key components of the marketing plan and the main decisions underlying each individual component are summarized in Figure 2 and discussed in more detail in the following sections. Blue-red ocean strategy: concept that focuses on the development of successful market strategies. Dall'oceano rosso della competizione spietata all'oceano blu calmo e senza concorrenza, dove per vincere bisogna innovarsi ed espandere il proprio mercato. Ci sono gli oceani rossi, quelli popolati da squali famelici, nei quali è di cile operare con successo. Sono i mercati tradizionali, quelli maturi, dove per traslato i pericolosi e numerosi concorrenti sono assimilati a sanguinari squali. Ma ci sono anche gli oceani blu, quelli senza inquilini aggressivi, non ancora frequentati da competitor, dove si può operare con tranquillità e, soprattutto, con pro tto. Break-even analysis: aims to identify the point at which the bene ts and costs are equal. Customers Behaviours are much more complex than what we can infer just looking at the gender consumer. We need to consider the consumer in the market place that can be very di erent from the consumer in generale. We need to consider the decision making process, if they are in uenced and why they are buying that stu. We need also to consider social class, age, gender, income and so on. Graph of decision journey of the customer: customers died and act driven by the desire to ful ll an active need. Customer rst search, evaluate, choose, purchase and then use. (vedi foto) So we have a process that is linear but in reality it is no linear at all, so it depends. People focus on active needs, which involve important aspects of their wellbeing. Example of need activation: car accident and the needs to buy a new car. Process/decision journey: need activation, information search, evaluation of the alternatives, choosing an option, making a purchase, using the o ering, repurchasing the o ering. Distinction between needs, wants and preference. ff fi fi fi fi fi fi fi ff fi ff fi ff ff ff ff ff ffi fi fi fi fi ff fi ff ff ff ff fl fi fi  Need: physiological or psychological requirement for wellbeing. It motivates action. Vary in strength and direction. Needs are innate aspects, they cannot be create and they can be activated. Need motivates action. Want: speci c expressions of a given need. One way that society has taught us that need can be satis ed. A want is not just a desire. I can ful ll one of my active needs if I want something. Wants can be created. Preference: bene ts expected from a given product, brand or service. Implies a comparison with other o erings. It implies a comparison with other o erings. We can classify needs. Maslow’s pyramid classify needs: -self-actualization (the most important):desire to become the most that one can be...all of this makes me a unit individual, it allows me to distinguish from the others. -esteem:respect, self esteem, status, freedom.. -love and belonging: friendship, intimacy, family... -safety needs: personal security, health, property.. -physiological needs: air, water, foods... Modernity: society of mass production, modernity can be seen as a platform and each Pilars are the family, religion, institutions, what we are is very complex to de ne. Postmodernism: trend constumization? , period of confusion, lack of structure, incessant choice. People will choose something not because thy like it but because they want to express they identity. You create who you want to be. 1. Talking about needs, a ful lled need tends to decrease until it is activated again. When a need is activated the customer starts his journey to ful ll that need. They look for information to decide how to ful ll it. Information on o ering dimensions, available options, performance of options on key dimensions (key dimensions depends on customers, they can choose something based on the safety, or something else based on how beautiful a car it is), then they evaluate. 2. Moreover when a customer is looking for information, there are internal sources (memory, past experience) and external sources (reviews, friends, sale force, advertising). The social decision journey: decisions and needs are deeply in uenced by social interaction. People consciously or subconsciously choose which information to process or ignore. 3. Evaluating market o erings: a set of many options is reduced to the consideration set. Value is the worth of an item. It is no an attribute of the o ering. It is an individual’s assessment of the ability of the o ering to meet certain needs. Value is created by 7 o ering attributes. Value re ects the worth of an item. Perceived risk and uncertainty: strategies to reduce perceived risk: obtain seals of approval, secure endorsements, provide free trials/samples, give extensive instructions, provide warranties/ guarantees. 4. Choice: usually a trade o between bene ts and costs of multiple options. People often gave to reconcile con icting reasons, develop a rationale to justify their choice to themselves and others. Adding more product features is not always good. An unneeded feature could be a reason not to choose. 5. Purchase: purchase frequently occur after a choice, but can also be temporary distant. Impulsive vs delayed purchase because of: unavailability, budget constraints, no urgent need, unclear bene ts, new information, new information, new info about a competitive options, cognitive dissonance. 6. Usage and satisfaction: involves consumption, solving the problems during consumption and ending use of the o ering. Satisfaction depends on: ful lment of needs, meet expectations coming from brand, (image, reputation, past experience and so on), customer experience which is sciatic to each customer. 7. The path of repurchase: we possibly want repurchase based on past experience, without the customer considering other options or restarting the journey. Rebut may depend on brand loyalty, fi ff fi fi fl fi ff fi ff ff ff fi ff fi fi fi ff ff fi fi fl ff fl  incentives to rebut, habits as routinised decisions. It can be interrupted by: dissatisfaction, boredom or fear to miss other good o ers, changes in availability. Path of repurchase: satisfaction —> usage frequency —> usage quantity—> repurchase. Rational model: people have clear and consistent preferences, people are fully formed and choose based one attributes, importance of attributes, performance of the o ering on attributes. Bounded rationality: trade o between accurate decision and mental e ort, choice is not entirely rational, people use heuristics to minimise the e ort. Heuristics: are simple decisions rules that people use to solve time and minimize cognitive e ort when forming judgments and making decisions. Heuristics tends yo focus on the most relevant aspects of the problems, cognitiva bias occur when people have to male complex decisions with limited information. Satis cing heuristic: evaluate the available options, until one acceptable is found. Satis cing is a decision-making strategy that aims for a satisfactory or adequate result, rather than the optimal solution. Instead of putting maximum exertion toward attaining the ideal outcome, satis cing focuses on pragmatic e ort when confronted with tasks. This is because aiming for the optimal solution may necessitate a needless expenditure of time, energy, and resources. The satis cing strategy can include adopting a minimalist approach in regard to achieving the rst attainable resolution that meets basic acceptable outcomes. Satis cing narrows the scope of options that are considered to achieve those outcomes, setting aside options that would call for more intensive, complex, or unfeasible e orts to attempt to attain more optimal results. Lexicographic heuristic: focus on the most important attributes and choose the option with the highest value on that attribute. The cheapest, the one with the best connectivity etc. Lexicographic heuristics are a speci c type of fast and frugal heuristics, where pieces of information are inspected sequentially, and decisions are based on the rst piece of information which satis es a pre-determined criterion (such as exceeding a threshold value) Elimination by aspect: set a threshold that must be met for an option to be considered. Implies a non-compensatory decisione process. Impostare una soglia che deve essere soddisfatta a nché un’pèzone possa essere considerata. The brand is the most important thing when you have two di erent things like shoes that are equal in terms of colors and utilizzo so the branding makes the di erence. Decisions and needs are deeply in uenced by social interaction, nowadays more than in the past. Selective attention: people select consciously or subconsciously information they want to process or ignore. Received information, selective attention, elective memory, selective processing, processed information. Memory can be represents as a network. System 1 and system 2: two modes of processing, di erent ways of taking information and making decisions. System 1 operates automatically and quickly with little or not e ort (95%). It’s non verbal, it is focused on recognition rather than comparison. Systems 2 is subjected to conscious judgments, slower, requires much greater mental e ort, (5%). It’s vigilant, focused on analysis and comparison. Consumer with a low level of involvement is more likely to rely on system 1. Consumer who display a high degree of care is more likely to rely on system 2. New product adoption: factors in uencing adoption: prominence of underlying need, value of the o ering, relative advantage with respect to competitors, transparency, compatibility, perceived risk, promotional activities, availability, purchase frequency. Product adoption: processo che un utente compie dalla scoperta del servizio no a diventare consumatore nel lungo periodo. Ci dice come e se il nostro prodotto è parte integrante delle vite degli user. ff fi fi fi ff ff fl fl ff fi ff ff ff ff ff ff fi ff fi ff fi fi ffi fi ff ff fi  Rogers’model: mostly descriptive, assumes that adoptions follows a normal distribution patter, which is no always the case. Moreover customers can be innovators in one domain and laggards in another. Modello che descrive come i nuovi prodotti vengono accolti e adottati dalla società. La curva descrive come i diversi segmenti usano il prodotto nel tempo. Rogers teorizzo l’esistenza di 5 gruppi di adopters: innovatori, visionari (early adopter), pragmatici (early majority),conservatori (late majority), scettici (laggard). Qualsiasi innovazione si propaga nel tempo coinvolgerà queste categorie in modo sequenziale, non ci sarà mai un’adozione di massa. Moore’s model: the adoption patterns is discontinuous and di erent customers require di erent marketing strategies. The most di cult gap is that dividing the early and mainstream markets. Same limitations of the roger’s model. Moore si riferisce al chasm, una sorta di divario di credibilità che nasce dal fatto che gli utenti credono e si dano solo delle persone che appartanegono al loro gruppo di adopter. Per lui esiste un divario critico/Chasm tra gli early adopters e l’early majority nel processo di di usione dell’innovazione. Il chasm rappresenta la transizione tra il mercato iniziale composto da innovatori e early adopters e il mercato di massa formati da early majority e i segmenti successivi. Se un’innovazione non riesce a superare il chasm, il suo potenziale di di usione e di crescita nel mercato sarà limitato. Strategie per superare il chasm: focalizzar sui sub un segmento to di nicchia, creare un whole product, costruire alleanze… Target customers (who) Strategic targeting identi es customers whose needs the company aims to ful l by tailoring its o erings to t these needs. In contrast, (how) tactical targeting aims to identify the ways in which the company will reach customers. these two types of targeting are not mutually exclusive but rather are two inseparable component of the process of identifying target customers. Developing an o ering’s strategy: identifying target customers, developing a value proposition, creating a company value. Marketing segmentation and targeting refers to the process of identifying a company’s customers and creating value for the customers. It’s achieved through the segmentation, targeting and positioning process. Creating market value: the target market de nes the environment in which the company aims to create value. The value proposition de nes the bene ts and costs for the company, its customers and its collaborators, the market o ering is the actual good that created value in the target market, the choice of target customers guides all strategic and tactical decisions. Segmentation: one for all and one for each often not feasible. Group customers into segments with similar needs. It focus one ful lling speci c needs, means ignoring the others, segment size depends on customization costs. Group customers with similar needs. Targeting: the company selects the segment of customers they will focus on. Divided into strategic and tactical. Strategic identi es customer needs, the company aims to ful ll with its o ering (segment choice based on the value the company can create and capture). Tactical identi es e ective and cost-e cient ways to communicate and deliver the company’s o ering (ho to identify and target that segment demographics, behavior, geolocation, psychology). Company will determine this based on attractiveness of the segment. Target attractiveness: is de ned by customers’ ability to create value for the company. Target compatibility: it is determined by the company’s strategic assets. It is the company ability to ful l the needs of its target customers. The company must also create superior value relative to the competition. The identi cation problem: needs are not readily observable. Identify characteristic that signal needs. Customer personas is a ctional representation of the prototypical target customer. ff ff fi fi ff fi ff fi ffi fi fi ff ffi fi ff fi fi fi fi ff fi ff fi fi fi ff ff fi  Pro le based targeting: demographics(age, gender), geolocation(country), behavior(Prior experience with the company, price sensitivity), psychology(attitudes, interests). Pro le target problem: segments with similar pro les can have di erent needs. E ectiveness and cost-e ciency: reach all target customers and them only. The main error is focus only on observable trait, misalignment between value and pro le. Segmentation: it is the process of reducing the degrees of freedom in designing the company o ering. Develop a di erent o er for di erent segments: price, incentives, communication. The error os the misalignment with needs. Segmentation trade o : often a compromise between dividing by needs and grouping by similarities. The average customer doesn’t exist. Segmentation errors: segmentation must group customers based on their response to the o ering who are similar without leaving groups out. Mece rule:mutuamente esclusiva collettivamente esaustiva: principio usato per classi care le informazioni in categorie che si escludono a vicenda (ME) e collettivamente esaustive (CE). ME signi ca che le categorie o gli elementi all’interno di un quadro non devono sovrapporsi o duplicarsi. CE signi ca che il quadro dovrebbe comprendere tutti i possibili elementi o opzioni senza omissioni. Nb: targeting reduces the degrees of freedom. Age subcultures: age groups have distinctive values and behaviours. Customer value The customer value proposition articulates the value a company ims to create for its target customers. The same o er can create di erent value for di erent customers, costs might outweigh bene ts. A common marketing problems is that managers tend to focus on the attributes of their o erings rather than on the underlying consumer need they aim to ful l. Customer value include: functional, psychological and monetary value. Key questions to identify competitors: why would target customers choose my o ering instead of available alternatives? Di erentiation: based on how customers perceive the o erings rather than actual performance. Competitive advantage is about di erentiation that is meaningful to customers. Modi per valorizzare l’o erta: 1. Framing bene ts: need-based, category-based, user-based, competitive framing, product-line. Framing is the act of manipulating context to make consumers more receptive to your product or service. 2. Positioning:create a meaningful and distinct image of the o ering, focus on the most important aspects, less is more. Positioning identi es the primary bene ts of the o ering, it involves prioritising all bene ts of the o ering based on their ability to create distinct customer value. Positioning can involve one or more bene ts. Rationale for a single-bene t positioning: to deal with information overload, people simplify their choices focusing on the distinctive aspects of the o erings. Primary attribute heuristic: choosing the o ering that is best on the most important attribute(s) is easy to justify and is less likely to cause regret. Specialization: a single-bene t o ering is perceived to be superior on that dimension to a multi-bene t o ering. ff ff ff fi fi ff fi fi fi fi ff fi ff ff ff ffi ff fi fi ff ff ff ff ff fi fi ff fi fi ff ff ff ff ff ff fi fi ff ff fi fi ff  Positioning statement: not to be confused with o ering’s positioning, motto. A sentence that delineates the key concepts of an o ering. Target customers, frame reference, primary bene t (reason why consider and buy the o ering). Positioning maps: re ect customers’ perception of di erent o erings, also a ected by brand perception. Customer speci c as perceptions vary across customers. Customer loyalty: involves both a ective and behavioural commitment. Plan retention before customer attrition. The bene ts: lower service costs b/c customers are more familiar with the o ering and they forgive minor discrepancies. Marketing cost e ciency because customers are more less sensitive to price, pay less attention to competitors, and better respond to advertising. Advocacy because customers who bring new customers. No acquisition costs , no need to reacquire loyal customers. The path of loyalty: 1. Satisfaction: understand that customers vary in they needs, same product but di erent satisfaction and it is monitor through surveys, net promoter score, big data analytics and honest signals. We also have to manage dissatisfaction. Customers are much more sensible to underperformance than overperformance. Unhappy customers are 3 to 4 time more likely to share their experience than happy ones. Managing dissatisfaction can increase loyalty, we cane ignore companies when: don’t have resources to address them, unrealistic expectations, customers try to take advantage. 2. Build relationships 3. Reward programs:it has 3 main objectives: increase purchase frequency and quantity, make customers feel special and o er them extra bene ts not available to other buyers, collect customer data. 4. Switching costs: can have detrimental e ect when the customer feels manipulated and limited in the freedom to choose. It consist in: time and e ort, monetary penalties, compatibility issues. 5. Brand communities: user group, individuals who use a product and share info and expertise, brand community, individuals who have a sense of connection with the brand, share rituals, experiences, they support and inspire other users, promote the o er. Customers equity: the value generated by customers over their lifetime with the company, both monetary and strategic. Align customer value and equity: too much resources usually placed on customer acquisition, instead of retention, no sustainable growth with high customer attrition, focus on those with high equity, use di erent strategies for di erent customers, consider the future while assessing equity. Company value The worth of the o ering to the company. It is divided into monetary value (revenues and costs a loro volta suddivisi) and strategic value. Strategic value: indirectly generate value, may produce a loss that is recovered by other o erings (increased demand of other o erings, reputation, brand awareness, recruitment, retention, information, network e ect, economies of scale, store tra c). An o ering can create strategic value by facilitating the demand for other o erings in the portfolio by strengthening Reputation. We can create value through collaboration. A new paradigm: collaborative business networks, implicit(iPhone apps creators) or explicit(contracts). Collaboration types: marketing insights, value design, value delivery, value communication. Collaboration pro: e ectiveness because collaboration enables companies to specialize, cost e ciency because greater economies of scale and experience, exibility, speed because results are achieved faster than building in house expertise. Cons: loss of control, loss of competences, empowering competition. ffi ff ff ff ff fl ff fi fi ff ff ff ff ff ff ff ff fi ff ff ff ffi ff ff ffi fl ff ff ff ff fi  Market position Market position can be de ned in 3 ways (approach to marketing): share of market, share of mind, share of heart. Share of market: unit sold, monetary value, be careful in comparisons If prices change over time. Share of mind: target, customers are aware of the o ering, the brand is the rst that comes to consumers’s ming. Share of heart: deep emotional connection, lovemarks. Is the message driven that focuses on creating emotional engagement with consumers rather than simply focusing on market share. Strategies to gain market position: 1. steal-share strategy = steal customers from competitors, speci c or whole market, achieved through bene t di erentiation and price di erentiation. Pepsi vs Coca Cola or new cola. 2. Market growth strategy = target new customers, expanding market typically bene ts all companies with the incumbent having an advantage, unless we have a superior o er that alters the market share proportions. It increases a business’s size, revenue, value. 3. Market penetration strategy = increase the quantity purchase by the company’s own clients, e.g. listerine encourages twice a day use. 4. Market creation strategy = create an entirely new market and bene t from being the rst mover, blue ocean strategy. Pioneering strategy: being ahead of the competitor by introducing a new product on the market rst. Pioneering strategy is one where a company has the rst mover advantage in an industry and uses that advantage to gain a large market share. The pioneer in any market has to defend its place in the market from competitors that follow it and has to keep up with the technology/trends or whatever is important to defend its market share. There are other advantages of capturing the distribution channels and increasing reach without interference of any competitor in the market. The buzz and the brand loyalty that a brand can build by being a pioneer can be amazing and it can use this to its advantage to outperform other competitor when they enter the markets. For Example: Nokia had a key advantage in the Cellphone industry as it was a pioneer and it had the largest market share in India for several years but it lagged in technology from the new players like Samsung and had to loose on market share. Bene ts of pioneering (barriers): - rst movers can shape consumer preferences. Brands like jeep become a synonym for the entire category. -create loyalty and switch costs iPhone compatibility with other apple devices (functional), cost to replace accessories (monetary), e ort in learning android (psychological). -secure scarce resources, raw materials, human capital, geo locations. -technological barriers, patents, operating systems, vide and music formats. -copyright, secrets, trademarks, awareness and brand. -learning curve, the slower the better. -economies of scale Drawbacks/svantaggi of pioneering: -free riding. Let entrant bene t from rst mover investments and resources, strong brands may enter later and leverage distribution and brand power. -incumbent inertia, due to resistance to change -market uncertainty, uncertainty about consumer reactions, technology, market demand.. Sustainable competitive advantage: it refers ti a company’s superiority over its competitors. Pioneering is not easy, build core-competences to create a sustainable competitive advantage. Business process management, operations management, technology leadership, product, service, brand leadership. Sources of sust.advant.: loyalty, innovation, scale, location.. Defend market position: -stay the course: ignore competitors action, believe no impact as the competitors o ering is low quality or it has a non sustainable price, or information missing to decide how to act. fi fi fi fi ff fi fi ff fi ff ff fi fi fi fi ff ff fi fi  -enhance the existing o ering: increase bene ts, performance, only add relevant attributes. Low price, better to use incentives instead of price change, they are easier to adjust. Each strategy depends on company resources and customers price/quality sensitivity. Defend market position: launch a new o ering: -vertical extension: both price and bene ts change -horizontal extension: functionalities or features change, not necessarily price. Defend market position: - ghting brand strategy: created to combat low price rivals. L’azienda lancia un’o erta a basso prezzo per a rontare concorrenti che cercano di sottostimarli. -sandwich strategy: simultaneous upscale and downscale, for two tired markets with two segments wither quality or price sensitive. Usata in caso di feedback negativo, usata per portare il collaboratore a ri ettere su suo operato in azienda. -good bette best strategy(pricing strategy): a three tiered product line, additional product development and management costs. Involves creating 3 price tiers for a di erent product: ex: iPad shu e, iPad nano, iPad classic. Other barriers to entry (factors that impede newcomers into a market): predatory prices (a dominant rm deliberately reduces prices of a product or service to loss making levels in the short term), overproduction (help building a reputation of aggressiveness, risk as in case of entry there will be a price was, useful when the incumbent has lower costs), bundling (sell goods together at a more convenient price). Barriers to exit: reputation, government regulations, very speci c investments, unemployment and due payments. Managing products Product management involves 4 key decisions: de ning product functionality, designing the physical appearance of the product, delineating product guarantees and warranties, creating the product packaging. Does the product create superior value for the customers, the company and its collaborators? One attribute might associate to more bene ts and vice versa. Bene ts are subjective. Product attributes: -performance -consistency -reliability -durability -compatibility -ease of use -degree of customization Product design: look and feel is important for primary aesthetic products. Styling creates value above and beyonds function, like brands. Guarantee: is a promise/assurance that attests to the quality or durability of a product or service. Promise that a manufacturer makes. -i receive a refund -applicable on product only -compensation if the product does nit work as expected -overall satisfaction vs speci c attribute -should be relevant and easy to understand and invoke -do not require added payment Warranty: is a written guarantee for a product -don’t receive a refund fi ffl fi ff fl ff fi fi ff fi fi fi fi fi ff ff  -applicable on products and services -i get a card to prove it -di erent because usually involve repair or replacement -warranty extensions are not free and can be purchased Packaging, functions: protection, containing, preventing counterfeiting theft, favour transportation and stocking, di erentiation, promotion. Design principles per lo sviluppo di un buon packaging: -visibility -di erentiation -value transparency -consumption impact Packaging modi cation: continuity is important to avoid confusion, big change in look and feel can disrupt habitual repurchase, dramatic redesign only useful for a total repositioning. Products lines: it is a strategy, a group of related products all marketed under a single brand name sold by the same company; can be distinguished by speci c brands. Products in a line address similar means, with di erences due to segmentation. Be careful to cannibalisation, customers confusion and costs. products can share common components or processes and produce economies of scale. This is sometimes a limitation for new product development. In the product lifecycle, communication, market size and growth rate, pro ts, all vary in the di erent stages. Consumers are more likely to buy products form brands they already know. Se have to extend product lifecycle, do not passively wait but develop the next generation that will replace the old one, or market expansion that is looking for new markets. All of this does not imply more complex and with more features, can also be simpler and with a lower price. Product lifecycle: introduction, growth, maturity, decline. We can have an involuntary obsolescence or a planned obsolescence. Product obsolescence refers to a decrease in the availability of the demand. Planned obsolescence: -generation obsolescence = new product make old products inferior termination of support -product obsolescence = force users to repurchase (refrigerators) -component obsolescence = components should not signi cantly outlast the life of the product, can also be used to increase post sale assistance (cars) Managing services Like for products, we can have warranties and guarantees. Service characteristics: the 3 di erences between products and services are: -ownership = unlike products, service do not involve change in ownership, right to use the o ering -separability = unlike product, delivered and consumed at the same time, hard to inventory -variability = greater variability in performance, quality varies across service occasions Service attributes: performance, consistency, reliability, compatibility, ease of use, degree of customization. (ex.net ix, airbnb) Service packaging: can be physical environment where the service is delivered (shop, buildings), greater uncertainty so company try to augment the service with physical attributes. Delivering superior services: outcomes di cult to standardise: di erent employees motivation and expertise. A key aspect of service delivery is managing the performance of a company’s employees. Recruiting: (reclutamento di persone) ff ff ff ff fi fl ff ff ffi fi fi ff fi ff  -company t = personality, company culture commitment to the company -core skills = creativity, drive teamwork, communication analytical, capacity to learn management, leadership -relevant experience = in the same or related industry for similar tasks Empowerment: shift the decision making power from management to front line, employees own the problem until resolved. Cut down intra o ce communication, employees are more engaged and motivated. Involves employees in company decisions, celebrate and recognize achievement.. Risks: overly generous to get customer appreciation, customers try to take advantage, greater service variability. Boundaries of authority became broken. Goal setting: use measurable and well calibrated performance metrics Control: enforce accountability, record phone call, mystery shoppers, customer feedback. Employee motivation: each employees has her own needs and value system. Be careful to employee competition and free riding. It can bene t monetary or non-monetary(self ful llment, passion..) Managing service failure: exceeding recovery expectations can make customers company advocates. Some have to stay due to switching costs, change e ort, lack of alternatives. Can become vocal adversaries, be careful to those who do not complain. Adress failure: -understand dissatisfaction, functional, monetary.. -e ective action, monetary bene ts, service upgrade, apologies -speed of response, slow response increases customers’ anxiety -inform about the process, to reduce uncertainty and give a reason for service failure -accept responsibility -fairness in resolving failures, proportional to the inconvenience caused Failures and opportunities: goal = avoid attrition, minimise reputation damage, successful actions can increase loyalty and customer satisfaction. Prevent failure with monitor service, solicit customer feedback, learn from defections, balance supply and demand. Pricing Pricing is a tool to create market value. Strategic price: prices come from strategy and not form the need to make pro ts. Implica prendere decisioni sui prezzi a lungo termine. Strategic factors: customers’s willingness to pay, cost structure, company goals, collaborators. Tactical price: breve termine. Tactical factors: attractiveness and uniqueness, brand, incentives, distribution. Percentage change in quantity sold relative to the percentage change in price. Price elasticity of demand a ected by: initial p and q values, e ect can be asymmetric, di erentiation from competitors. Company costs: a company must consider both its xed and variable costs to make a price that can lead to pro t. Total cost tends to decrease as the number of di erent goods produced increases. Pricing based on costs: markup pricing is less strategic, price should drive the cot and the opposite. Si considera il costo di produzione e distribuzione del prodotto. Poi a ciò si aggiunge una % di ricarica per determinare il prezzo di vendita. ff ff fi fi ff fi ffi ff fi fi ff ff fi fi  Strategies: 1. Penetration price: good when high sales volumes o set the low margins, when demand is elastic, competitive markets, you have resources to mass produce, advantage of being pioneer. Used to quickly gain market share by setting an initial low price to entice customers to purchase. 2. Skim pricing: customers who seek the most bene t and will pay a premium, maximises margins but lower market share, image pricing when quality is not readily observable, inelastic demand little competition, cost is not a direct function of volume. High initial price and lowers it over time. 3. Loss-leader pricing: can be used to increase the purchase of o erings of other o erings, good fort store tra c, freemium is good when variable costs are close to zero. Selling a product to a price that is unpro table but attracts new customers to buy additional products. 4. Price segmentation: o ering di erent prices for the same product based on customers’ segments. First degree : di erent price for each customer Second degree : di erent unit price for di erent quantities Third degree : di erent price for di erent segments. 3rd degree may depend on demographics, behaviour (timing of purchase, purchase quantity). Willingness to pay is not always observable to make segments. Preference price e ects: internal (prior purchase, other o erings, fair price, reservation prices, future expectations), external (competitive o ering). People are more sensitive to change in price rather than to change in quantity. Price ending: $ x.x9 seed as better deal but perception of a discount $x.x4 or $x.x7 stand out as less frequent $x.x0 or $x.x5 or $x perception of quality, easier to remember Price can change over time as demand, competitive o erings and market environment can change. Auctions(aste): used when there is uncertainty about the optimal price. English (starting price, the highest bid wins), dutch (price is lowered, the rst bid wins). Or price negotiation is an alternative. Bid= an o er to pay an amount of money for something that is being sold. Reverse pricing: the consumer pays what they want, in some cases the company need to accept. Ex. Donazioni. Price wars: occurs more frequently when low di erentiation, economies of scale, stagnant market, low customer loyalty. Detrimental to pro t because: competitors will ght and low price is not sustainable, shift in consumer expectations, emphasis on price erodes brand power. Reactions: Staying the course: if little impact and sustainability of the price cut of competitors. Repositioning the o ering: because market has changed and the alternatives are low price, add bene ts, add new o ering, downscale extension with ction brand. Usually illegal practices: 1.predatory pricing= selling low cost to drive competitors out of business. 2.price xing= companies conspire to set prices. Evaluating market o ers: A set of many options is reduced to the consideration set. Value is the worth of an item. It is not an attribute of the o ering. It is an individual’s assessment of the ability of the o ering to meet certain needs. Value is created bay the 7 o ering attributes. Managing brands ff ff fi ff ff ffi ff ff fi ff ff ff ff ff ff fi ff fi ff ff fi ff fi ff ff ff ff ff fi ff fi  The brand indicates the source of the goods and di erentiates the good from the competitors. Brand attributes are the tools that the company uses to positione the brand and create The desired brand image in customers minds. Brand building involves 2 types of attributes: brand identi ers and brand referents. Brands create strategic and monetary company and collaborator value. Brand power: -create value beyond product characteristic -strengthening marketing tactics -hiring and retaining skilled employees -create unique identify to di erentiate from competitors -brans are now ubiquitous: services, companies, products,.. Brands are not products!!! And not just a part of a product. The same product can use di erent brands, the same brand might span multiple products. Brand image: designing and sustaining a mental image in peoples mind, we can use a map to represent primary and secondary associations. Evaluate the type, breadth, strengths and favorability of associations, their consistency with company values. It can be di erent for very customer as perceptions are ltered by needs, values and knowledge. Brands create customer value: -functional value: identify the o ering, distinguish from competitors signal performance -Psychological value: emotional + shared values, self expression, lifestyles, social groups, societal, grati cation from contributing to society. -monetary value: signal price like Ikea signal low prices, nancial value due to higher resale price Brands create company value: -strategic value: bolster demand, amplify marketing tactics, collaborator support, recruitment and retention. -monetary value: revenues and pro ts, company valuation, company asset Brand create collaborator value: -strategic value: partnering with strong brands increases demand, loyalty.. (also Halo e ect). -monetary value: revenues, more sales. Brand positioning: the mental image the company aims to create vs brand image that is the associations that actually exist, dimensions can vary in positioning charts. Brand identi ers: attributes created and maintained by the company, to di erentiate and make the brand identi able. Also quant to leverage brand referents but they exist independently. Good brand identi ers: memorable, unique, protectable, strategic, communicable. Brand name: trade o between distinction and descriptiveness. Brand logo: letters, fonts, colours.. Brand motto: articulates the brand positioning to customers. Imperative (call for action), descriptive (key bene ts), declarative (general statement), superlative (claims leadership), provocative (challenge conventions), promise based. Brand character: ctional personality that embodies the brand essence, expresses more complex values and gemtosn that wording and logo. Especially important for commodities, might distract or not appeal all customers. Brand sound mark: tune (simple and easily remembered melody), music (wordless melody that complements identity), jingle (melody with words and vocalisation). Brand packaging: shape, colors.. fi fi fi fi fi fi ff fi fi ff fi ff ff fi ff ff ff ff  Product design: is a brand identi er when it distinguishes the brand from the other products. Brand referents: elements linked to the brand image, to leverage their value. Exist independently of the company. -needs: -bene ts -experiences -occasions -activities -places -people -concepts -objects -products -brands Brands as means of self-expression: -status brands -personality brands -professional brands Veblen e ect: demand increase with price, for consumers who want to use exclusive products, price is quality. Brand portfolio: l’insieme di marche appartenenti alla stessa famiglia. Single brand strategy (umbrella branding): a company aims each of its brand as exclusively at a particular segment. ex: Bic (penna, accendino). If the customers are the same, this strategy is better. Multi brand strategy: one business creates and promotes multiple brands with the same market. Ex: Meta that owns instagram, WhatsApp. If you are chasing di erent customers segments, this strategy is better. La caratteristica principale di questa strategia, anche detta Branded House, è quella di avere un’unica marca per più linee di prodotto o servizio. In questo modo, si ha la possibilità di capitalizzare il valore del brand e di sfruttare la sua notorietà anche in nuovi segmenti di mercato. Pertanto, ciò permette di concentrare le risorse disponibili per il marketing su un unico brand e di sviluppare economie di scala e di scopo. Inoltre, è possibile che si creino anche dei sub-brands in grado di a ancare il brand originario dell’impresa, altresì detto corporate brand, nella promozione di un prodotto speci co. Sub-branding: combines umbrella brand with lower tier, underscoring the umbrella. Un sub-brand è un marchio secondario che fa parte di un marchio principale. Un sub-brand può essere utilizzato per diversi care un'o erta di prodotti o servizi, o per raggiungere una nicchia di mercato. Ad esempio, un'azienda di abbigliamento potrebbe creare una sub-brand per una linea di abbigliamento sportivo, o un'azienda di prodotti alimentari potrebbe creare una sub-brand per una linea di prodotti biologici. Ecco alcuni esempi famosi di sottomarche: Microsoft – Xbox, Samsung – Galaxy, Amazon – Alexa, Apple – iPhone. Co-branding: Ultima strategia di branding, consiste nell’accostare due brand diversi derivanti da due aziende diverse. Questo accordo tra le parti, ha un tempo limitato per quanto riguarda l’attuazione e può essere di due tipi: funzionale: l’accostamento tra i brand vuole evidenziare bene ci connessi alla performance del prodotto. Pertanto, assume rilevanza sia la coerenza tra i brand sia quella tra i prodotti, cioè la product t, soprattutto guardando gli attribuiti produc ‐related; emotivo: l’enfasi è posta su fattori psic sociali o esperienziali che vengono attribuiti al brand. Assume rilevanza prioritaria la coerenza tra le associazioni attribuite dai consumatori ai diversi brand t, considerando maggiormente gli attributi no product related. Un esempio interessante, è quello di Fiat in collaborazione con Gucci. Insieme hanno realizzato in occasione del 150° anno dell’unità d’Italia e dei 90 anni di Gucci, un modello automobilistico uscito sul mercato con un rialzo del 52% rispetto al prezzo di una Fiat 500 standard. E’ evidente che, in questo caso non si mira ad una product t, bensì a far leva sulle associazioni mentali dei consumatori. Endorsement: combines umbrella brand with lower tier, underscoring the lower tier. Endorsement è l'attività, la dimostrazione o la dichiarazione pubblica di sostegno, approvazione e/o utilizzo di un prodotto, servizio o brand, portata avanti da un testimonial o da un endorser che contribuiscono a conferire notorietà, visibilità e credibilità ai beni o ai servizi promossi e a fi fi fi ff fi ff ffi fi fi o­ fi n­ t­ -­ fi ff  migliorare la reputazione aziendale. L’endorsement è di solito portato avanti da celebrità, da in uencer o da esperti di settore. Lo scopo principale di questo contratto è quello di conferire notorietà, credibilità e aumentare la visibilità del bran