ITM Units 4-7 PDF

**Unit 4: Product** **1.- Concept and classification (product concept)** Product is anything -- goods, services or ideas- that can motivate and satisfy the needs of a buyer. A group of blue and green squares with white text Description automatically generated **Product classification\ **Tangible...

**Unit 4: Product** **1.- Concept and classification (product concept)** Product is anything -- goods, services or ideas- that can motivate and satisfy the needs of a buyer. A group of blue and green squares with white text Description automatically generated **Product classification\ **Tangible products are bread, computers, cars..\ In the middle: food in restaurants, repairs, banking services etc.\ Intangible products: are ideas, family planning, political programs **The attributes of a tangible product\ **technical qualities, brand, style and design, physical characteristics, packaging, additional services: installation, repairs, warranties. **The levels of a product\ Basic level:** Core customer value = the functional, emotional, aesthetic, ethical, cultural/trends**\ Actual product:** physical and visible, tangible and quantifiable attributes. Brand name, quality level, packaging, design, features. This is the level the consumer generally thinks about.**\ Augmented product:** additional services offered with the product. Delivery and credit, after-sale service, product support, warranty. **\ ** **Brand, packaging, and labelling.\ **From a marketing perspective: *A brand is "a name, term, sign, symbol, or design, or a combination of them, intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors". They also represent consumers' perceptions and feelings, emotions or intangibles.* All signs, especially words, including personal names, drawings, letters, figures, colours, the shape of the product or its packaging, or sounds, may be registered as trademarks, provided that such signs are suitable for distinguishing: - The products or services of one company from those of other companies and - Being represented in the Trademark Register in such away that enables the competent authorities and the general public to determine the clear and precise scope of the protection granted to its owner. The advantages of using a brand - Differentiate from competitors - Freedom to decide prices - Support the commercial strategy - Facilitate loyalty - Warranty of homogeneous quality - Identify the brand - Facilitate the product or service identification - It can create emotional connections **The principal graphic elements of the brand\ **Logo \> the part that can be seen and identified but not pronounced. It's the visual identification Name \> the part that can be read and pronounced. It's the verbal identification. **\ ** **\ ** **Desirable brand name characteristics** - Short - Evocative - Suggests benefits and qualities - Easy to pronounce, recognise, and remember - Distinctive - Translatable for the global economy - Capable of registration and legal protection Desirable logo characteristics - Simplicity - Representative - Scalability - Pragnanz ( "good figure"). Appeal, allure - Original - Registrable - Durable Brands can convey feelings, emotions, associations, etc., through the colours that are part of their brand design. Yellow: optimism -- clarity and warmth\ Orange: friendly -- cheerful and confidence\ Red: excitement -- youthful and bold\ Purple: creative -- imaginative and wise\ Blue: trust -- dependable and strength\ Green: peaceful -- growth and health\ White: balance -- neutral and calm  Types of brands based on the elements that compose them **Word mark** = a word mark consists exclusively of words or letters or numbers or other standard typographic characters, or of a combination of any of those. A screenshot of a computer Description automatically generated Figurative mark = a trade mark where non-standard characters, stylisation or layout, or a graphic feature or a colour are used. They can consist exclusively or figurative elements or of a combination of verbal and figurative elements.  **Shape mark = a shape mark is or extends to a 3 dimensional shape. It can include containers, packaging, the product itself or its appearance.** A screenshot of a product Description automatically generated **Pattern mark = a pattern mark consists exclusively of a set of elements that are repeated regularly.**  **Colour mark = a colour mark is either just a single colour or a combination of colours (without contours).** A screenshot of a computer screen Description automatically generated **Sound mark = a sound mark consists exclusively of a sound or a combination of sounds.** **Motion mark = a motion mark consists of a movement or a change in the position of the elements of a mark.**  **Multimedia mark = a combination of images and sound.** **Hologram mark = elements with holographic characteristics.** **Brand, packaging and labelling *(Packaging)*** Packaging = primary (contains the product)\ Secondary (contains one or more primary packages) Labelling = contributes to the individualisation of the product and creates its own identity. ***Codification*** A close-up of a bar code Description automatically generated Standard World Communication:\ Unique identification \> Global Trade Item Number -- GTIN **The code should be changed in the following circumstances:** - Change of attributes (colour, smell, etc.) - Change in size and/or weight - Multipacks - When the packaging changes - When the formula or the composition change and it is perceived by the consumer - For promotional changes **The benefits of coding** - Improves the effectiveness of the intermediary - Reduces the costs for manufacturers and intermediaries - Detailed sales information - Less time at cash register **Unit 5: Promotion** 1. **Concept of commercial communication** In general, communication in marketing is the transmission of messages to influence attitudes and behaviour. The sender (the company, the organisation, the brand) sends messages to reach the receivers (usually consumers, other organisations, etc.) with different purposes: - Inform - Change the behaviour - Build stable relationships **Key questions in communication decisions:** - Who communicates and what is the objective? - What do you want to say? - Who do you want to communicate to? - How do you want to communicate? - What media and tools do you want to use? (Communication Mix) - Which media outlets? POEM Model A **briefing** is when you are explaining what you want from a marketing agency. **Advertising** - Unilateral, impersonal, and controlled communication tools, through which an advertiser, using paid messages, addresses a target audience with the aim of persuasion. **Direct marketing** - Communication tools that allow direct interaction/engagement with the target audience, treated as individuals, with the goal of obtaining a measurable response. **Sales promotion** - A commercial communication tool comprised of multiple techniques, aimed at both the distribution network and the final consumer, which allows for the achievement of marketing and communication objectives by adding a promotional bonus to the product or service, temporarily defined, with a quantifiable end benefit in terms of sales increase. **Public relations (PR)** - A communicative strategy presented predominantly in an informative manner with the goal of achieving credibility, trust, and acceptance of an idea, a product, a service, an organisation, or an individual or legal entity among the various internal and external public relations of an organisation. **Personal selling** - A personal, direct, interactive communication tool with measurable and immediate responses. *Concept and process of commercial communication*\ **Communication Mix:** **The promotion mix** (also called **marketing communications mix** or communication mix) is the specific blend of promotion tools that the company uses to persuasively communicate customer value and build customer relationships. **Integrated marketing communications (IMC)** involves carefully integrating and coordinating the company's many communications channels.  **POEM model** \> is a marketing framework that helps to formulate the marketing strategy. It stands for paid, owned, and earned media. From the slides: A broadcasting model that groups the different channels a company can use to carry out a communication campaign, combining the mix of online and offline communication. **SEM**: A broader digital marketing strategy that includes both paid and unpaid efforts to increase a website\'s visibility on search engines. In common usage, SEM often refers specifically to **paid search ads** (e.g., Google Ads). **SEO**: A strategy focused on optimising a website to improve its organic (unpaid) rankings in search engine results  2. **Owned Media** Owned media are the communication channels/platforms that the company/brand owns and controls directly. They do not entail a payment for thebroadcasting of messages, as they are managed by the company and can be usedat any time. They only have a maintenance cost, content creation or generation, work time, etc. **Owned media: own online channels\ **- corporate website\ - microsite\ - company blogs\ - own social media accounts\ - app **Owned media: direct marketing\ **- advertising emails\ - mobile advertising messages\ - letters with commercial content (mailings) **Owned media: public relations (PR)\ **- Facility visit programs for groups or open house days\ - Contests and prizes not linked to purchasing\ - Congratulations and small gifts on special dates for being customers\ - Organisation of events within the company for groups of people with shared interests\ - Corporate reports\ - Letters and emails with non-advertising content\ - Internal news magazines or newspapers\ - Events and celebrations **\ ** **Public relations** is a strategic communication process that builds mutually beneficial relationships between organisations and their publics.\ "That form of communication management that seeks to make use of publicity and other nonpaid forms of promotion and information(...)" **Owned media: personal selling\ **- People who perform tasks associated with sales, customer acquisition, and retention\ - Customer service centres\ - Virtual chatbots **Owned media: own point of sale-POS\ ** LED screens with advertising projections\ Displays\ Audio communication\ Signage\ Bagging (bags)\ Brochures **Owned media: sales promotion** Consists of short-term incentives to encourage the purchase of a product or service. It is designed to get an immediate response and improve sales figures. The characteristics:\ Communication -- incentive -- invitation Sometimes they are **owned,** and other times **paid.** They are considered owned actions when they do not require payment to third-party channels, but they could be considered actions in paid media if they require payment to retailers or wholesalers or to communication platforms (newspapers or magazines) for their execution. A blue and orange rectangles Description automatically generated **Owned media: sales promotion to consumers**  **\ ** **Owned media: sales promotion to dealers** A blue rectangles with white text Description automatically generated **\ ** **Paid media** - These are third-party channels that the company pays to communicate a specific message. - It encompasses all those instruments that involve a cost, within both online and offline environments, whether it be using an advertising medium (television, internet), or hiring agents for the use of communication instruments (direct marketing, sales promotion, sponsorship)  **Paid media: advertising** A screenshot of a computer Description automatically generated TV advertising  Cinema/movie theather A screen shot of a movie theater Description automatically generated Radio advertising  Newspapers and magazines advertising A close-up of a stack of magazines Description automatically generated Outdoor advertising  Internet advertising A diagram of a company\'s marketing strategy Description automatically generated Point of Sale (POS) advertising  Direct marketing (advertising) A person holding a book Description automatically generated **Summary \>****\ ** **\ ** **Earned media** Earned media which are external to the brand that have been incorporated into communication through the *actions of clients or followers* on social networks. **They do not involve actual payment** and are not owned by the brand. Earned media: on the internet A group of people standing in front of a brick wall Description automatically generated Earned media: unpaid PR  **Factors to consider in the marketing mix design** A chart with text and images Description automatically generated with medium confidence **Unit 6 -- Place** **Nature and importance of distribution channels** **The concept of distribution \>** A commercial function that involves making products available to the market **Why is distribution important? \>**\ Influences all marketing decisions\ Can create competitive advantages\ Entails long-term commitments Direct marketing vs Indirect marketing Adidas directly selling their products in their retail shop is direct marketing. If if it sold with 'actors' in the middle, it is indirect marketing. Direct marketing:  Indirect marketing: A diagram of distribution of goods Description automatically generated **Retailers** are intermediaries that purchase products with the intention of selling them to end consumers. **Supermarkets** etc. **Wholesailers** are intermediaries that market products for resale or insitutional use. They sell to retailers and industrial, agricultural, or governmental companies. **Makro**. Distribution channel: a set of interdependent organisations, acting as intermediaries, that help make a product or service available for use or consumption by the consumer or business user. **How do intermediaries add value?**\ Intermediaries provide expertise, contacts, specialisation, and operations on a larger scale. - Reduce the number of contacts - Adapt assortment to customer needs - Overcome temporal, spatial, and transactional discrepancies **Number of levels -- Channel levels** A **channel level** is each level of marketing intermediaries that performs some work in bringing the product closer to the final consumer. The **channel length** is the number of levels. **A direct distribution system:** manufacturer straight to the consumer. **An indirect distribution system:**\ **Short channel:** manufacturer \> retailer \> consumer\ **Long channel:** manufacturer \> wholesaler \> retailer \> consumer. **Decisions on channel design** *Analysis of consumer needs* - Proximity vs. relocation with better options - Purchasing in person/by phone/by mail/online - Range breadth vs. product specialisation - Service demand *Defenition of objectives* - Company structure - Products - Competition - Environment *Identification of alternatives* - Intermediary types - Number of intermediaries: 3 strategies (target market coverage-density) Intensive distribution\ Selective distribution\ Exclusive distribution - Responsibilities of channel members *Evaluation of alternatives* - Economic criteria: sales, costs, profitability - Control criteria - Ability to adapt **Intensive distribution**\ The goal: Maximise coverage and ensure the product is available in as many points of sale as possible. *Features:* - Commonly used for mass consumer goods such as food, beverages, and hygiene products - The products are available in a wide variety of stores, including supermarkets, convenience stores, and sometimes even vending machines - Key benefit: greater visibility and convenience for the consumer, which can lead to an increase in sales Example: Coca-Cola is a company that uses intensive distribution. Their products can be purchased in almost 200 countries worldwide. **Selective distribution**\ The goal: A balance between excessive availability and exclusivity. Selects certain points of sales but does not saturate all possible options. *Features:* - Used for products seeking specific market positioning, such as certain electronics or branded clothing - The products are found in selected stores that match the target market profile - Key benefit: helps to maintain the brand image and better control how the product is presented to the consumer Example: L\'Oréal offers products for sale in high-end department stores, rather than in mass-market retailers. Products in Bijenkorf for example. **Exclusive distribution\ **The goal: Limit distribution to very few outlets, often only one per geographic area/location *Feautures:* - A common strategy in luxury or high-end products such as luxury cars, jewelry, and high fashion - Outlets are carefully chosen to maintain brand exclusivity and prestige - Key benefit: creates a sense of exclusivity and elitism, which can increase the brand\'s appeal to certain market segments Example: Apple is known for its selective distribution strategy, especially with its high-end products like iPhones, iPads, and MacBooks. The company primarily sells these products through its own Apple Stores and its website. Although they are also available in select retail stores, Apple maintains strict control over how its products are presented and sold. **Retailers**: An intermediary that buys products to sell them directly to end consumers for personal and non-business use. Most retail sales are carried out by retailers.  Retailers -- Trends A blue rectangular box with white text Description automatically generated **Wholesaler**: An intermediary that buys products to resell them to the following members of the distribution channel. Wholesale trade is characterised by acquiring products from manufacturers and other wholesalers and distributing them to other wholesalers, distributors, retailers, and sometimes manufacturers, but not to end consumers.  Wholesalers- Trends A red rectangular sign with white text Description automatically generated Virtual intermediaries Online marketplaces: Digital platforms whereby different sellers market their products and services. The buyers can acquire them through an easy and safe transaction. Both sellers and buyers remain in the marketplace until the end of the transaction.  Comparators or Price Comparison Websites (PCW) Platforms specialised in searching and comparing products based on the requirements of the consumers. They identify the products that best fit consumer demands and facilitate the comparison between them. By clicking on the product you can see the product card in the online shop or in another online price comparison website (Shopbot). The types of comparators or Price Comparison Websites - Comparators: only show on the search the sellers website (insurance, financial products, etc.). Do not provide other comparator results. E.g. Rastreator, Confused. - Meta-search: provide other searchers (Booking, Expedia, Destinia) on the result list and hotels' websites on the same site. E.g. Kayak, Trivago. - Google Shopping: lets consumers search for, view and compare products. It redirects you to other comparators or the shop's website. **Chapter 7: Price** The price is the monetary value given to the set of satisfactions received at the time of purchasing a product. *Factors that influence pricing*\ **External**: demand of end users/members of the distribution channel/competitors/environment: economic, political, and legal.\ **Internal**: business objectives, marketing strategies, costs. Pricing methods Based on cost:\ A diagram of a company Description automatically generated  Based on demand Consumer psychology\ Demand elasticity = Perceived value Target price A screenshot of a math test Description automatically generated The role of costs\ Based on competition - Parity - Higher than competitors - Lower than competitors Pricing methods -- Setting retail prices Direct distribution: selling price (without taxes) = Price manufacturer/producer Indirect distribution: selling price + distribution margin (without taxes) = Price manufacturer/producer The distribution margin is the intermediary margin 1 + \... + intermediary margin 'N' **Intermediary margins:**