Principles Of Marketing 1st Quarter Reviewer PDF

Product portfolio PRINCIPLES OF management MARKETING FIRST QUARTER REVIEWER ○ Value communication Team...

Product portfolio PRINCIPLES OF management MARKETING FIRST QUARTER REVIEWER ○ Value communication Team President, Academics Committee Sales promotion strategies Sales force strategies Advertising LESSON 1: INTRODUCTION TO MARKETING What is being Marketed? Marketing In Marketing, PRODUCTS are what we call tangible or intangible goods, Organizational function and a set of services, ideas, etc., that are being processes for creating, communicating, marketed to consumers. Anything that and delivering value to customers and consumers can avail is considered a for managing customer relationships in product. ways that organization and its ○ Goods, Experiences, Services, stakeholders. Events, Information, Properties, ○ Organization: Business People ○ Stakeholders: Customers Getting your consumers to buy your Marketing 101 product through communication. About meeting needs profitably (Kotler & 1. Product Management (1950-1960) Keller, 2006) Many products were seen as generic You go into business so that you get to because they had no unique branding. satisfy the needs of the market and of ○ Key Functions of Marketing: your organization Generate demand for “The aim of marketing is to make selling products superfluous” - Peter Drucker, 1973 Develop a product “The aim of marketing is to make selling Determine the price unnecessary” Do the promotion, and set up the place of Strategic and Tactical distribution 1. Strategic 2. Customer Management (1970-1980) Long Term Customers are at the heart of marketing Customer Segmentation activities to generate more demand. Target market selection More strategic and focused on customer Value Positioning management disciplines such as segmentation, targeting, and positioning 2. Tactical (STP) Short Term, Flexible The main goal of this era is to “Know ○ Value development customers” Product design and development 3. Brand Management (1990-2000)  As the internet age dawns, consumers Promote value become more well-informed, connected, and open to changes. LESSON 2: RELATIONSHIP OF Focused on human emotions and MARKETING introduced “Emotional marketing, experiential marketing, and brand equity. Essential Aspects of Marketing Brand management discipline emerged in marketing practices Understanding people’s fundamental needs and drivers Approaches to Marketing Identifying customers Developing the entire go-to-market and 1. Traditional usage ecosystem Anything except digital means to brand your product or logo. Maslow’s Hierarchy of Needs Focuses on Production Methods, Product Quality, and Expensive Selling. ○ Direct paper mail, Telemarketing, Television, Print Ads, Radio, Brochure Advantage: Faster results (if right target), durability, the level of trust Disadvantages: Difficulties in measuring, high costs, static, timing, customization 2. Contemporary Comprises a set of modern techniques and methods applied by organizations in promoting products/brands and Physiological - what we need to survive concerns about the relationship with (food, etc.) customers and the market. Safety - health and security ○ Social Media Marketing, Belongingness & love - relationship Relationship Marketing Esteem - prestige, feeling of Aimed at building long-term accomplishment relationships with customers based on Self-Actualization - achieving one’s full the use of information. Communication potential and digital technologies. PSSP Hierarchy of Needs Marketing Goals Satisfy the changing needs & wants. Introduce/Innovate products to improve quality of life. Customer-driven management Deliver superior value Beneficial and profitable customer relationship. Capture Customer Value  different forms of marketing communication if financial or other resources backing the demand are lacking (Kermally,2016). Consumer Behavior Factors that Affect Consumer Behavior 1. Culture Subcultures Personal - better world, fun, freedom Social Classes Social - love, friendship, connection Overall culture of a group Safety - protection and physical Behavior among sub-cultures of a group well-being Priorities Esteem - prestige, feeling of Core Value accomplishment Shared Histories Self-Actualization - achieving one’s full Language potential 2. Personal Needs, Wants, and Demands Age Needs Life Cycle ○ State of felt deprivation about Occupation something that is deemed to be Economic Circumstances necessary. Demographics ○ Basic forces that motivate a Gender and Preferences person to do something. Disposable Income Physical Location Wants ○ Affect How Goods and Services ○ Specific manifestation of your are viewed: various needs. Differences in taste and ○ “Needs” that are learned during a preferences person’s life. What they can and ○ Wants are also called cannot buy “Processed needs”. Access to services Demands 3. Social ○ Wants backed by purchasing Groups power. Family Roles ○ Ability to satisfy economic Status needs depends largely on Norms of Behavior income. Unwritten Code of Conformity ○ This is a very important point for Aspirational Groups marketers to understand, as it is not possible to create a demand by advertising or by investing in How do different Socio-economic classes Buying Behaviour behave High Low Products that target the broad market are Involvement Involvement typically advertised in vernacular, while products that cater to upscale are more Significant Complex Variety advertised in English. Differences buying seeking For fast-moving goods to reach the mass between behavior buying market, distribution channels have to be Brand behavior extensive and neighborhood-driven, as Few Dissonance Habitual well as focusing on public markets and Differences reducing buying convenience stores. between buying behavior The wealthier the socio-economic class, Brand behavior the greater the need for personal space. To reach higher-income markets, large Consumer Buying Roles supermarket chains are preferred. User Initiator 4. Psychological Influencer a. Motivation Decider Needs, desires, and wants that drive the Buyer individuals to achieve something. Consumer Decision-making Process b. Perception 1. Need Recognition Set of processes by which an individual 2. Search for Information becomes aware of & interprets 3. Evaluation of Alternatives information (Gregory et al. 1995). 4. Purchase Decision 5. Post-Purchase Evaluation c. Learning Involves changes in an individual’s Business Buying Roles behavior arising out of the new User knowledge/experience. Initiator Influencer d. Beliefs Decider A descriptive thought that a person holds Giver about something. Gatekeeper e. Attitude Business Buying Process Person’s enduring favorable or unfavorable evaluations. 1. Need Recognition Emotional feelings, beliefs, and action 2. Product Specification tendencies. 3. Supplier Search Towards some object or idea. 4. Proposal Analysis and Supplier Selection 5. Order Specification Emotional vs Logical Decisions 6. Performance Assessment Buying Decisions are 20% Logic and 80% Emotional  Customer Lifetime Value (CLV) strategies around customer acquisition, Is a business metric used to determine the marketing, and sales. amount of money customers will spend on your product or service over time 5. Better understand loyal customers Helps you understand the most loyal Reasons to know CLV brand advocates. 1. Determine customer acquisition cost How often do they shop from your How much should you invest in hiring a business? What items are they more likely new customer? to purchase? When you can determine the amount a Answering these questions can help you customer will spend on your business, brainstorm ways to engage with your most you can gauge the amount of money to loyal customers. spend on marketing campaigns. Steps to Calculate CLV 2. Improve profitability consistently over 1. Determine the average order value time Determine the average amount customers Helps you focus on ensuring consistent spend on your business. To get this profitability over time. information, check out your e-commerce If you only invest in acquisition and analytics tool or get an estimate based on closing new deals, it won’t be easy to customer transactions in the last few remain profitable during slow seasons. months. In contrast, a high CLV means you can rely on enough people to return to your 2. Identify the frequency of transactions store throughout the year. Next, identify how often customers come to your store. How many times do they 3. More accurate forecasting come back, given a specific period? Do Helps you make better production, they return weekly, monthly, or annually? workplace, and inventory decisions. It helps pinpoint the types of clients you 3. Measure customer retention have, the best-selling products you buy, Figure out how long an average customer and the factors that drive customer loyalty. remains loyal to your business. Some Otherwise, you may spend more on industries, including restaurants and retail, producing products insufficiently in tend to have a lower CLV because demand. customers tend to go to establishments that offer a better deal. Meanwhile, 4. Improve overall business strategy industries such as technology and travel Helps you determine the most effective have a higher CLV because customers strategy for your business growth. If your seek updated product features and CLV is low, you may need to invest more personalized holiday experiences. in loyalty programs and initiatives to boost customer retention. 4. Calculate CLV In contrast, a high CLV means you may CLV = average order value × number of need to look into the best-selling products transactions × average length of the and campaigns driving growth to keep the customer relationship (in years) momentum going. Over time, this strategy will help you create more cost-effective  ○ Php 600 (per visit) × 12 (visits per ○ If the vision is no longer relevant to year) × 5(years) = Php 36,000 the present time or future time. (CLV) Mission Importance of CLV Basic purpose of setting up the business. Can help determine how much customers ○ “To provide high-quality, affordable will spend on your business in the long education to underprivileged term. children to empower them for a It helps inform customer loyalty, better future” acquisition, marketing, and sales decisions. Portfolio Analysis Improving CLV can be done through Analysis of the business's products, various tactics, such as creating a loyalty including their profitability and contribution and rewards program, to the company’s income. Creating personalized experiences and offering quality customer service. Financial Analysis Staying aware of common pitfalls when Company’s cash flow aiming for high CLV can also help prevent errors that could make your company Internal Partner Analysis waste valuable resources. Company’s strategic alliances or those they work with to create and deliver their products. LESSON 3: MARKETING PROCESS The Strategic Marketing Process 2. External Environment Narrowing to best opportunities and Are the different variables outside a developing a strategy. business that affect its operations. Seeks to establish a clear and concerted direction for all marketing activities of an Types of External Environment organization. 1. Macro Includes plans to reach specific “General environment”; indirectly goals/objectives. affects. The business has no control ○ PESTEL Marketing Planning Process Political: Government 1. Business Setting Analysis activities and Political Vision conditions Business’ 5 - 10 year picture of the Environment: Weather, enterprise. climate, natural disasters, ○ “To create a world where every etc. child has access to quality SocioCultural: Suitability education and the opportunity to to local trends, cultures, reach their full potential” norms, etc. The vision of an organization can be Technological: changed. Advancements in ○ If the vision has been reached equipment and tools for ○ If the vision is impossible to reach operations  Economic: Inflation A simple framework for assessing and rates, unemployment, evaluating the competitive strength and consumer behavior, etc. position of a business organization. Legal: Policies, laws, Objective: Determine an industry structure regulations, etc. and level of competition in that industry. Stronger competitive forces mean the 2. Meso industry is less profitable. Positioned between Macro and Micro; outside control but has a direct effect on the company. Target group ○ Trade associations, partnerships, stakeholders, media, etc. 3. Micro “Operating environment”; direct effect on day-to-day operations. Business has a lot of control. One-on-one interactions ○ Customers, suppliers, competitors, intermediaries, etc. Competitive Rivals SWOT Analysis ○ Competition of similar companies It assesses and evaluates the market, in an industry customers, competitors, and the company’s internal and external Supplier Power environment. ○ The power of a supplier over their prices. Stronger power = Higher Strengths (Internal) supply pricing ○ What the company does better than others Buyer Power Weaknesses (Internal) ○ The power of a supplier over their ○ The aspects of the company that prices. Stronger power = Higher need to be improved supply pricing Opportunities(External) ○ The trends or conditions that can Threat of Substitution positively impact the company ○ Risk a customer will choose a Threats (External) different product or service instead ○ These trends or conditions that of yours; replaced can negatively impact the company Threat of New Entry ○ Difficulty or ease for a business to Porter’s 5 Forces start operating in your market Created by Michael E. Poret in 1979 to understand 5 key competitive forces that affect an industry.  3. Objective Setting Extract key issues from the SWOT Matrix Porter’s Generic Strategy Formulate smart goal objectives to address key issues Steps in Objective Setting Understand Business Goals Analyze Market Conditions Identify Target Audience Set Clear and Specific Goals Allocate Resources Develop Action Plans Monitor and Adjust Differentiation: making your product 4. Marketing Strategy Development unique among your competitors Translating strategies into action plans. Segmentation: breaking down Is a growth strategy that involves selling consumers into manageable groups your existing products to a new group of Cost-Leadership: reducing costs of customers. making products to gain more profit and to Start with market research by analyzing keep the price at a level with competitors your market segments and selecting the ones you want to target. Sub-categories of Strategies Integration STP Model ○ Forward: retailers/distributors Segmentation ○ Backward: suppliers ○ Divide the market into groups with ○ Horizontal: competitors similar criteria Targeting Intensive ○ Select the most suitable segment ○ Penetration: increase market to focus on shares by intensifying promotions Positioning ○ Development: developing new ○ Develop a product to appeal to markets the chosen segment ○ Product Development: improving product Marketing Strategic Options Diversification ○ Related: similar products ○ Unrelated: no basis Defensive ○ Alliances/Merges: 2 or more co. form a new organization ○ Retrenchment: regrouping through cost reduction  ○ Divestiture: selling a division Key Metrics to Monitor ○ Liquidations: selling all assets Return on Investment (ROI) ○ Evaluate the financial return from marketing activities 5. Evaluation and Control Periodic monitoring and evaluation should Customer Acquisition Cost (CAC) be done to make necessary adjustments ○ Monitor the cost of gaining each due to deviations new customer Evaluation ○ Provides insights into what works Customer Retentions and identifies areas for ○ Track how well marketing efforts improvement. are maintaining customer loyalty Control ○ Ensures that activities align with Market Share the objectives in the marketing ○ Assess the business’s standing plan. Involves monitoring and compared to competitors over adjusting tactics. time. Periodic Monitoring ○ Regular, ongoing assessment of Conversion Rates marketing activities to ensure that ○ Measure how effectively marketing strategies stay on campaigns turn leads into track. customers. Steps in Evaluation and Control Setting Benchmarks LESSON 4: MARKETING ○ Define performance goals and RESEARCH success criteria Marketing Information System Monitoring Performance Everything (people, equipment, system) ○ Collect data from various used to analyze marketing channels. (social Market intelligence > Company < Market media) Research ○ Example: SM Advantage Card; Analyzing Results through this, SM gets your ○ Compare results to benchmarks information to identify deviations Internal Records Taking Corrective Action Documents and resources of a company or ○ Adjust strategies or tactics to a business, such as order-to-payments address gaps cycle, invoices, data, sales forecasts, sales information Ongoing monitoring ○ Continuously track performance Market Intelligence after adjustments to ensure Set of procedures and sources used by improvements. managers to obtain everyday information  about developments in the marketing useful if you ask a large group of environment people the same questions. The larger the group, the more Market Research reliable the results Process of collecting and analyzing data to address a specific marketing problem Focus Groups Helps to find out more about customers ○ Set of people from a given target market; closed controlled Research Process environment Define the Problem ○ Useful in gathering strong ○ Must be clear, concise, attainable, opinions from a group measurable, and quantifiable ○ Establish objectives that will be the Experimental Research base of the research questions ○ Used to answer a hypothesis using an experiment Develop the Research Plan ○ Choose a combination of References: appropriate research methods to fulfill the research objectives Content from Ma’am Benita Gamboa Collect data Lesson 3 from 12ABM-11 Presentations ○ Ensure that the data gathered is detailed and complete to avoid misleading or irrelevant results Analyze ○ Actual processing of data Present Findings ○ Interpreted data can be presented in a textual report with graphs, charts, etc. ○ Comprehensive documentation of the entire research process so it can be a helpful reference for the firm’s decision-making needs Market Research Methods Proofread by the Team Secretary, Team President, and Team Vice President. Observation ○ Type of qualitative market research; gather insights Surveys ○ Best used to determine the market’s opinion, perceptions, and demographic data; only