Strategic Marketing PDF

Strategic Marketing 1 Marketing’s Journey............................................................................................ 1 1.1 Defining marketing....................................................................................... 1 1.2 Brief history..................

Strategic Marketing 1 Marketing’s Journey............................................................................................ 1 1.1 Defining marketing....................................................................................... 1 1.2 Brief history................................................................................................. 2 1.3 Key milestone, key shifts - Evolution of Marketing.......................................... 2 1.4 Turbulent times........................................................................................... 3 1.4.1 External forces..................................................................................... 3 1.4.2 Internal forces...................................................................................... 3 2 Strategic Marketing............................................................................................. 4 2.1 Cascading choices – Creating Value, Making Choices.................................... 4 2.1.1 Creating value...................................................................................... 4 2.1.2 Making choices.................................................................................... 5 2.2 Strategic marketing defined.......................................................................... 5 2.2.1 Innovation as driving force.................................................................... 6 2.3 Step-by-step process................................................................................... 7 3 Customer Centricity........................................................................................... 9 3.1 “We hear You”............................................................................................. 9 3.1.1 There are diUerent types of needs and wants......................................... 9 3.1.2 Needs evolve over time and are influenced by digital.............................. 9 3.1.3 Customer insights - At the core of Marketing.......................................... 9 3.1.4 Customer insights – The Voice of Customers.........................................10 3.2 Customer Experience (CX)..........................................................................10 3.2.1 Not just UI / UX....................................................................................10  3.2.2 Why is it critical?.................................................................................10 3.3 Getting CX right..........................................................................................11 3.4 Embed CX at the core of the business..........................................................11 3.4.1 From customer insight to CX journeys Consumers / B2C......................11 3.4.2 From customer insight to CX journeys Entreprises / B2B.......................13 3.5 What customers do, want, expect for both B2C and B2B...............................14 3.6 Customer journeys & measures..................................................................14 3.7 CX in the Age of AI.......................................................................................14 4 Brand & Purpose (8)...........................................................................................15 4.1 Purpose.....................................................................................................15 4.1.1 Purpose is human..................................................................................15 4.1.2 Purpose and business..........................................................................15 4.1.3 Start with WHY....................................................................................16 4.1.4 Purpose Defined & In Action.................................................................17 4.1.4.1 Rules...............................................................................................17 4.1.4.2 Qualities..........................................................................................17 4.1.4.3 Deep Purpose..................................................................................17 4.1.4.4 Purpose-driven marketing.................................................................17 4.1.4.5 Purpose-driven performance impact.................................................17 4.1.5 Getting purpose wrong.........................................................................17 4.2 Brand.........................................................................................................18 4.2.1 Brand(ing) defined...............................................................................18 4.2.2 Roles of Brand.....................................................................................18 4.2.2.1 Consumer.......................................................................................18 4.2.2.2 Company.........................................................................................18 4.2.2.3 Society............................................................................................18 4.2.2.4 Brand vs Product..............................................................................19 4.2.2.5 Brand vs Commodity........................................................................19 4.2.2.6 Brand vs Marketing...........................................................................19 4.2.3 Brand concepts/elements....................................................................19 4.2.3.1 Concepts.........................................................................................19 4.2.3.1.1 Brand Identity = What the brand aspires to be..............................19 4.2.3.1.2 Brand Personality = How the brand connects with people............20 4.2.3.1.3 Brand Image = How people perceive the brand............................20  4.2.3.1.4 Brand Equity..............................................................................20 4.2.3.1.5 Brand trust................................................................................21 4.2.3.2 Elements.........................................................................................21 4.2.3.2.1 Name........................................................................................21 4.2.3.2.2 Slogan.......................................................................................21 4.2.3.2.3 Character (human, animal or other personality)..........................21 4.2.3.2.4 Jingle.........................................................................................21 4.2.3.2.5 Packaging..................................................................................21 4.2.3.2.6 Tagline......................................................................................22 4.2.3.2.7 Logo..........................................................................................22 4.2.3.2.8 Symbol......................................................................................22 4.2.4 Brands evolution.................................................................................22 4.2.4.1 Brand hierarchy................................................................................22 4.2.4.2 Brand development..........................................................................23 4.2.4.3 Changing its brand, completely.........................................................23 4.2.4.4 Brands in crisis................................................................................23 5 Responsible Marketing (9)..................................................................................24 5.1 Societal challenges everywhere..................................................................24 5.2 How did the world get here..........................................................................25 5.3 How can we respond ?................................................................................26 5.4 Sustainability over time...............................................................................26 5.4.1 1980-90s - CSR - Corporate Social Responsibility..................................27 5.4.2 ESC - Environmental, Social and Governance.......................................27 5.4.3 SDG - Sustainable Development Goals.................................................27 5.4.3.1 What are key sustainability challenges of the fashion industry?..........27 5.5 Marketing and Sustainability.......................................................................28 5.6 Circular economy.......................................................................................29 5.7 Marketing practices vs Greenwashing..........................................................29 5.8 Consumers and sustainability.....................................................................30 5.9 Towards sustainable marketing...................................................................30 6 Market & Competition (5)...................................................................................31 6.1 Competition is everywhere..........................................................................31 6.2 Markets and Competition............................................................................31 6.3 Blue Ocean strategy cases..........................................................................35  6.4 Business Model innovation – Canvas & key patterns.....................................36 6.5 Summary...................................................................................................37 7 Research & Insights (4)......................................................................................38 7.1 Marketing research.....................................................................................38 7.1.1 Objective 1 : Problem identification......................................................38 7.1.2 Objective 2 : Problem solving...............................................................38 7.1.3 What is Marketing Research ?...............................................................38 7.2 Shift to Big Data / Analytics and AI...............................................................39 7.2.1 What is data ?......................................................................................39 7.3 From data to insight to action......................................................................39 7.4 Big Data unlocking potential........................................................................40 7.5 Challenges of Big Data................................................................................40 7.5.1 Data privacy concerns.........................................................................40 7.5.2 Analysis-Paralysis................................................................................40 7.5.3 Lack of Human Insights.......................................................................40 7.6 Augmenting insights - Complementary disciplines.......................................41 7.6.1 EXPLORING HUMAN INSIGHTS - Applied Anthropology in Marketing......41 7.6.2 INTEGRATING PSYCHOLOGY Behavioral Economics and Marketing.......42 7.6.3 TAKING INSIGHTS EVEN FURTHER - Neuroscience applied in Marketing.42 8 Digital & Social (6).............................................................................................43 8.1 Guest speaker: Performance Marketing.......................................................43 8.2 Digital & Social media definitions................................................................43 8.3 Evolution and eUectiveness........................................................................44 8.4 Benefits & challenges.................................................................................45 8.5 Omni-channel marketing............................................................................45 8.6 Selected trends..........................................................................................45 9 Emerging technology (7).....................................................................................46 9.1 Emerging technology transforming industry, customer and marketing...........46 9.1.1 Industry..............................................................................................46 9.1.2 Marketing............................................................................................46 9.1.2.1 Marketing 6.0...................................................................................47 9.1.2.2 Quantum Marketing (Raja Rajamannar).............................................47 9.2 Data, AI and GenAI for Marketing.................................................................48 9.3 More technologies......................................................................................49 9.4 Implications for CMOs................................................................................49 10 Agile Marketing..............................................................................................50 10.1 Why agility?................................................................................................50 10.2 Marketing Operating Model.........................................................................50 10.2.1 Organization & stucture.......................................................................51 10.2.1.1 Functional Structure.....................................................................51 10.2.1.2 Product-based Structure...............................................................52 10.2.1.3 Geographical Structure.................................................................52 10.2.1.4 Market-/Customer-based..............................................................52 10.2.1.5 Customer stage............................................................................52 10.2.2 Tech-powered op models.....................................................................53 10.3 Agile Marketing...........................................................................................53 10.3.1 Five critical trade-oUs..........................................................................55 10.4 Power of partnership (internal/external)......................................................56 1 Marketing’s Journey 1.1 Defining marketing Not just : advertising, sales, 4Ps It is : everything that has to do with customers Etymology o Mercatus (latin) => marketplace or merchant o Dictionnaries 16th century => The process of buying and selling at a market. o The history of marketing is closely tied to the evolution of human trade and commerce. 1935 : performance of business activities 1985 : process of planning and executing 2024 : value creation - creating, communicating, delivering, and exchanging oRerings that have value for customers, clients, partners, and society at large Marketing, today Intangible B2C B2B Place M Inseparable (need customer Buyers many few Person presence) Purchases smaller larger Social Variable (quality depends on who Cycles Shorther Lengthy, Fundraising provides it) buying complex Political Perishable (can’t be stored for Decision Often 1 More personal later use / sale makers selling More mass More personal marketing selling Distributed Often globally concentrated by areas Trends Mixed models B2B consumerization o Compare goods online Historically been highly dependent o Self-service tools for reordering on people. o Same purchasing experience Digital technology augments or across channels replace. 1 1.2 Brief history 1.3 Key milestone, key shifts - Evolution of Marketing Future of Marketing => Ever-evolving marketing 2 1.4 Turbulent times => Forces shaping marketing => Opportunities & Challenges 1.4.1 External forces Economic Social Geo-political Climate Consumers Technology 1.4.2 Internal forces Strategic alignment ERectiveness Collaboration Talent squeeze 3 2 Strategic Marketing 2.1 Cascading choices – Creating Value, Making Choices 2.1.1 Creating value Customer Do the perceived benefits outweigh the perceived costs? Company By creating benefits for customers, firms can capture value in return Value based pricing Companies need to balance where to focus Society Companies preserve/enhance the well-being of customers and society. Societal Marketing social and environmental sustainable or responsible marketing ≠ “NGO marketing” or “social marketing” 4 2.1.2 Making choices Strategy = integrated set of choices => create sustainable advantage and superior value In large corporation: Multiple levels of choices 2.2 Strategic marketing defined Creating value diRerentiates on its strengths => better value to customers Making choices : Strategic Marketing = mission, target market & positioning, growth strategy, product portfolio, new products as-is/situation analysis available corporate resources à holistic view medium/long-term broad portfolio 5 2.2.1 Innovation as driving force 6 2.3 Step-by-step process Purpose = WHY External Anso_ Matrix 4P à 7P à Why does the organization exist? PESTEL Why are do what we do? Porter action priority matrix Societal 5C analysis Authentic Customers Believable Competitors Relevant to beneficiaries Collaborators Engaging Climate SWOT Vision BCG Growth Share Matrix Where the company is headed, what it wants Internal How to prioritize their ≠ businesses by their * of profitability. to become, in accordance with its purpose. 5C analysis Company Mission The steps and actions to be taken to achieve SWOT thevision. The‘What’and‘How’. Brand = term, name, sign, symbol, design, or a Marketing Plan combination of them à identify a company’s product Expected ROI or services Marketing Budget Creating new markets à SMART goals Goals Where a company wants to end up and define the business strategy’s expected achievements. They are broad and long-term Purpose-Driven LT & Forward-Focused Actionable Objectives => SMART 7 How your company plans to achieve its goals based on the context of the organization. They are specific and measurable B2C Geographic segmentation: “where” Demographic segmentation: “who” Behavioral segmentation: “how” Psychographic segmentation: “why” B2B Substantial Measurable Accessible Actionable 8 3 Customer Centricity 3.1 “We hear You” 3.1.1 There are di>erent types of needs and wants 3.1.2 Needs evolve over time and are influenced by digital 3.1.3 Customer insights - At the core of Marketing Understanding their needs, wants and behaviors Marketing relies on accurate & reliable customer information Customer insights are fresh understanding of customers and the marketplace derived from marketing information that become the basis for creating customer value and relationships Understanding the customer needs is simply vital 9 3.1.4 Customer insights – The Voice of Customers gathering & understanding à improve the customer experience. 3.2 Customer Experience (CX) => Overall impression pivotal role in the growth of businesses 3.2.1 Not just UI / UX 3.2.2 Why is it critical? Impact of poor/bad customer experience 10 3.3 Getting CX right => Making the complex simple ans the ordinary extraordinary => Memorable experiences => Consistency is the foundation => Positive intent and empathy 3.4 Embed CX at the core of the business 3.4.1 From customer insight to CX journeys Consumers / B2C CX starts with understanding consumer behavior Factors of influence 1. Cultural : Culture, Subculture, Social Class 2. Social 3. Personal 4. Psychological : Motivation/drive, Perception, Learning, Belief 11 Consumer decision process Relational or Hedonic More customers are involved (= perceived personal relevance of the object) : very low or very high à the more extensive they will search for information Beliefs: ideas you hold to be true, thought Personal sources that a consumer holds about something Commercial sources Attitudes: how you approach situations, Public sources: person’s enduring favourable or Experiential sources unfavourable evaluations, emotional feelings and action Compensatory model: tendencies toward some object or idea. weighs +/- of the Behaviours: how you act considered alternatives Non-compensatory models: eliminates alternatives that do not meet a particular criterion + emotion, intuition, habit or immediate need (convenience products and services >< emergency goods or impulse goods 12 Consumer response From decision process to Marketing Funnel The digital era is driving important evolutions... Linear Discrete Dynamic Holistic Complex Nonstop Unpredictable Life-Cenric 3.4.2 From customer insight to CX journeys Entreprises / B2B 1. Problem recognition 2. General need description characteristics and quantity 3. Product specification best technical product characteristics 4. Supplier search 5. Proposal solicitation 6. Supplier selection 7. Order-routine specification technical specifications, quantity needed, expected time of delivery, return policies, and warranties 8. Performance review decides to continue, modify, or drop the arrangement Highly complex : large number of stakeholders Initiator Influencer Gatekeeper: ensure that minimum conditions are met Buyer Decider User 13 3.5 What customers do, want, expect for both B2C and B2B Digital transformation à B2B consumerization = B2B stakeholders increasingly expect consumer-like experiences and have become much more empowered by using online channels à providers of goods or services to enterprises more frequently struggle to become involved early on to influence the buying decision and provide personalized experiences. 3.6 Customer journeys & measures => Track how it improves / worsens over time => Evaluate success or failure of changes Customer ERort Score (CES) Net Promoter Score (NPS) Customer Satisfaction Score (CSAT) eRective for tracking customer eRort over time and predicting loyalty, but it assesses short-term should be complemented by Experience NPS (interaction) customer satisfaction with NPS for a fuller picture. specific interactions or Relationship NPS (product, busines unit) touchpoints. focuses on a single interaction, while NPS covers Competitive benchmark the entire customer (brand) relationship, making them complementary metrics. measures long-term customer loyalty and overall relationship with the brand, making it a strong indicator of potential company growth. While CSAT is versatile, it is limited in evaluating long- term loyalty and should be used alongside other metrics. 3.7 CX in the Age of AI New type of customer relations Changing expectations and new experience possibilities Experiences become immersive The future of customer experience... Cross-functional commitment and collaborative execution Internl capabilities, talent, and organizational structure aligned Must be intertwined with customer service à keep pace with customer needs Empathy with technology AI-driven personalization Harnesses the power of tech and analytics 14 4 Brand & Purpose (8) 4.1 Purpose 4.1.1 Purpose is human => Aspirational reason for being which inspires and provides a call to action for an organization and its partners and stakeholders and provides benfit to local and global society. 4.1.2 Purpose and business Customer-side : “The rise of the purpose-led brand.” Employee-side : Sources of purpose & motivation that employees draw from o Themselves o Fellow employees o The Company o Impact on the Customer o Impact on Society 15 4.1.3 Start with WHY Golden circle – Simon Sinek Not just achieving financial benefit >< Having an impact on the world 1. Define the organization’s purpose 2. Bringing the purpose to life 3. Activate purpose in global strategy 4. Activate purpose in marketing strategy A meaningful purpose statement is Societal Authentic Believable Relevant to beneficiaries Engaging Purpose : Why does the organization exist? Why are do what we do? Vision : Where the company is headed, what it wants to become, in accordance with its purpose. Mission : The steps and actions to be taken to achieve the vision. The What and How. Values : How you behaves as a brand, what behaviors and attitudes you display Positionning : How all of the above is encapsulated to occupy a distinct place in people’s minds. Where purpose aRects companies? Demand Generation – Marketing & sales : How can purpose increase consumers’ preference for products and services? Employee & Partner Engagement : How can purpose strengthen the connection that employees feel to the work and to one another? Governance & Sustainability : How can purpose help reinforce a company’s reputation as a good corporate citizen and a strong ESG performer? Strategy & Business Valuation : How can purpose enhance opportunities for profitable growth and reduce business risk? Not all purposes need to be social. Many of the challenges stem from the perceived lack of alignment between how they behave and what they say they stand for. 16 4.1.4 Purpose Defined & In Action 4.1.4.1 Rules Don’t rally around a cause unless you actually have one A strong culture is often all you need Don’t delegate purpose to the marketing team alone 4.1.4.2 Qualities Inspiring Succint Should have a role and an outcome Can have a tension that is unresolvable - there might be two conflicting intentions or ambitions that create a space for continuous innovation, growth, and improvement. Balance between aspiration and precision Can be a “general purpose” or a “social purpose” statement Can evolve with the times 4.1.4.3 Deep Purpose 4.1.4.4 Purpose-driven marketing External communication eRorts focuses around its purpose Stronger relationship with its customers : Authentic and emotional bonds based on shared values. Infused in everything the company does, all its actions and communications. 4.1.4.5 Purpose-driven performance impact On customers On employees On brand advocacy On company results and growth On planet and society 4.1.5 Getting purpose wrong Without translating into reality Purpose-washing inspired from the term green washing Woke-washing = co-opting causes for commercial gain without making real contributions. External pressures à deviate fromits purpose 17 4.2 Brand 4.2.1 Brand(ing) defined Brand development is the deliberate, continuous process of creating a strong, distinctive, positive perception of a company, its products and services in the customer’s mind by developing & combining various assets. Brand marketing is creating a unique identity, values, and perceptions that diRerentiate it from competitors. Connect emotionally with consumers Build loyalty Drive sales and market share Brand is much more - Neuromarketing experiment in 2003 by Read Montague Blind test - without brand names Pepsi Nonblind test – being told one brand name Coke à Brand is able to influence and to shape preferences => What people say it is => The sum of all experiences => All experiences they associate with that brand 4.2.2 Roles of Brand 4.2.2.1 Consumer Identifies the maker of a product Simplify decision making and reduce risk Their identity 4.2.2.2 Company Simplify product handling Protection Legal property Secure a competitive advantage Carry values and give meaning Strategic dimension Inspires and frames innovation Longer time frame 4.2.2.3 Society Contribute to the evolution 18 4.2.2.4 Brand vs Product Product Brand... is anything that can be oRered to a market it can have dimensions that diRerentiate it in for attention, acquisition, use or some way from other products designed to consumption that might satisfy a need or satisfy the same need. want. It may be a physical good or a service. 4.2.2.5 Brand vs Commodity Commodity Brand Awareness and reputation Completes the need Creates and satisfies a yearning in the buyer's mind 4.2.2.6 Brand vs Marketing 4.2.3 Brand concepts/elements 4.2.3.1 Concepts 4.2.3.1.1 Brand Identity = What the brand aspires to be = unique set of brand associations that the brand strategist aspires to create or maintain. What the brand stands Imply a promise to customers from the organization members. Help establish a relationship between the brand and the customer. Brand Identity Prism - Jean-Noël Kapferer (1996) => Help us understand these elements and how they relate to one another => Build strong brands à helps them communicate clearly and transparently and be easily 19 4.2.3.1.2 Brand Personality = How the brand connects with people = set of human characteristics associated with a brand Aaker model - J. Aaker (1997) => helps to describe your brand personality 4.2.3.1.3 Brand Image = How people perceive the brand 4.2.3.1.4 Brand Equity = the intangible value a brand holds in the minds of consumers. It represents how well a brand is recognized, perceived, and trusted in the market. => The way consumer think, feel, and act with respect to the brand as well as in the prices, market share, and profitability it commands. Dimensions Brand loyalty Brand awareness Brand associations Perceived quality How to build it ? Focusing on customer perceptions and experiences Complementarity and Consistency of the brand elements How to measure it ? A combination of Quantitative and qualitative approaches Consumer-Based Metrics Financial Metrics Market-level metrics 20 4.2.3.1.5 Brand trust = The state of confidence and positive expectations that consumers have towards the brand = The secure feeling that the brand will meet their consumer expectations. 4.2.3.2 Elements 4.2.3.2.1 Name Qualities of a good name It has Meaning It is Distinctive It looks towards the Future It is Adaptable It is Easy to protect It is Positive It has Visual Qualities Name Categories Founders name : Ford, McDonalds, Louboutin,... Descriptive : Toys “R” us, Citibank,... Metaphor : Tesla, Amazon, Patagonia,... Acronym : IBM, GE,... Fun, quirky feel : Zyla, Dirty Lemon... 4.2.3.2.2 Slogan = catchphrase used in advertising to grab the attention of consumers 4.2.3.2.3 Character (human, animal or other personality) Alive, embodying a brand's attributes or values 4.2.3.2.4 Jingle 4.2.3.2.5 Packaging 21 4.2.3.2.6 Tagline = short phrase that adds context to a brand and goes hand in hand with corporate vision Essential features Short Distinct from competitors Uniqueness Summary of brand essence & promises Catchy & Memorable No negative connotation Can be protected & registered Provoque an emotional positive response Not easy to create Types of Taglines Imperative : ‘Just do it’ Nike Descriptive : ‘Ideas worth spreading’ TED Superlative : ‘The ultimate driving experience’ BMW Provocative : ‘Impossible is nothing’ Adidas Interogative : ‘Can you hear me know?’ Verizon Wireless 4.2.3.2.7 Logo = a symbol or other small design adopted by an organization to identify its products, uniform, vehicles, etc. 4.2.3.2.8 Symbol 4.2.4 Brands evolution 4.2.4.1 Brand hierarchy Corporate, umbrella and family brands Endorsed brands Individual brands + Co-branding 22 4.2.4.2 Brand development 4.2.4.3 Changing its brand, completely... Reputation management / Negative associations Rupture with past Legal/trademark constraints Merger or Acquisition Expansion into new markets New strategy / Modernization Diversification of portfolio Simplification 4.2.4.4 Brands in crisis It takes years to build a brand, but a nanosecond is all it takes for a poorly managed crisis to destroy all the work done. A crisis is an event - internal or external - with the potential to negatively aRect a brand. ERective brand reputation management begins long before a crisis occurs. The important thing is to know how to deal with it even before you have to, with well-established communications plans and prepared teams. No organization can aRord to underestimate the impact that a seemingly innocuous decision can have on its business and long- term reputation. The media and the public have good memories, and will remember how a crisis was handled or not. 23 5 Responsible Marketing (9) 5.1 Societal challenges everywhere Since WWII, societal advances are being reported... Global extreme poverty Global life expectancy Access to electricity Ozone Depletion Protected areas Renewable electricity generation but societal challenges remain omni-pres 24 5.2 How did the world get here... Supply and The circular flow Rational economic Endless growth demand of the of income and man measured in GPD or market goods with Alone, money, national income Market at the households and ego, calculator center of our businesses in the and doesn’t care vision essential market about nature. Price, the relationship and Hates work, love foundamental some leakages luxury, knows the metric of our and re-injections price of concern via banks everything Everything else governments and are called trade. externalities Makes no account for energy or the material basis of the economy. Says nothing about unpaid caring work that makes labor fresh and ready for work every day. 25 5.3 How can we respond ? Policymaking and its impacts on business & consumers Example of new approaches considered by policymakers (changing the “business as usual”) Collaboration is required New opportunities, innovation, and resilience. 5.4 Sustainability over time 26 5.4.1 1980-90s - CSR - Corporate Social Responsibility = the way through which a company achieves a balance of economic, environmental and social imperatives (“Triple- Bottom-Line-Approach”), while at the same time addressing the expectations of shareholders and stakeholders. => Companies make a concerted eRort to operate in ways that enhance rather than degrade society and the environment. => Organisational level : strategic initiative that contributes to a brand's reputation Ethical responsibility Environmental impacts Philanthropic endeavors Financial responsibilities CSR Sustainability Target opinion formers The entire business : value chain, Compliance and sets its targets that way suppliers, partner and customers. Looks back and reflects on what a Forward thinking, more holistic and LT company has done to contribute to oriented society 5.4.2 ESC - Environmental, Social and Governance => Provide a framework and range of targets for a business à improve its sustainability à lower its risk level across various factors 5.4.3 SDG - Sustainable Development Goals September 2015 : Adopted by the United Nations 17 SDGs à provide a better future for the world’s population by 2030 The ultilmate objectives are o Eradicate hunger and poverty in the world o Protect the planet o Ensure that all human beings, today and tomorrow, live in peace and prosperity 5.4.3.1 What are key sustainability challenges of the fashion industry? Environmental aspects Social aspects Governance aspects Climate Change Labor/Employee Product quality, safety,... Water management Relations, Collective Bribery and corruption Waste and Pollution Bargaining and Working Environmental & social mitigation Conditions factors in Modern Slavery/Forced policies/procedures Labor Child Labor 27 5.5 Marketing and Sustainability 1970-80s 1980-90s à 1990-2000s 2000s-today Social Marketing Societal Marketing Sustainable Marketing Social Cause Marketing or Non- profit Marketing Maintains or improves the Orientate businesses, brands consumer's and society’s well- and society towards a Goal of achieving the "common being. sustainable future. good. LT wellbeing The design, implementation, Demarketing and control of programs Discouraging (not destroying) calculated to influence the the demand for a product acceptability of social ideas Green Marketing Socially responsible marketing which a firm cannot supply Ecological Marketing (SRM) in large-enough quantities or does not want to supply Development and promotion of Ethical conduct, sustainability, in a certain region where the products that are presumed to and corporate social high costs of distribution or be environmentally safe. responsibility. promotion allow only a too little profit margin Sensitive or responsive to The integration of ethical, social, ecological concerns. Regenerative Marketing and environmental Nurtures communities and considerations into marketing builds local prosperity over the strategies and practices. long term 28 5.6 Circular economy 5.7 Marketing practices vs Greenwashing Packaging – using renewable or recycled materials or less packaging Creating New Products (manufacturing & distribution) that reducing the environmental footprint Promoting sustainable consumption & lifestyle choices Supporting fair trade and ethical sourcing of materials Developing products and services that promote sustainability Certify products and services for sustainability & communicate Transparent and honest communication about sustainability Implement actionable reporting frameworks to quantity impacts 29 5.8 Consumers and sustainability COP 29 World comes together to agree on the actions to address the climate crisis New goal on climate finance Next round of national climate plans Bolder, fully implementable and investable strategies and targets are economy-wide, focus on transitioning away from fossil fuels, and keep the world on track to 1.5 degrees Do consumers care about sustainability ? Quantitative insights Overall product sales data analysis indicates ‘Yes’ at detailed level, the picture is more contrasted Qualitative insights COMPANIES’ ASSUMPTION : Sway people towards sustainable choices REALITY : People aren’t looking for business organizations for directions 5.9 Towards sustainable marketing Marketing’s contribution Legal behaviour Ethical behaviour Socially responsible behaviour Customer Lifestyle chocies Sustainability direct actions No greenwashing Cause-related marketing actions 30 6 Market & Competition (5) 6.1 Competition is everywhere 6.2 Markets and Competition 1. Identify competitors : direct & indirect 2. Determine competitors’ Objectives : profitability ,market share , and growth goals à understand their motivations and strategies 3. Identify competitor’s strategies : targetmarkets, positioning, marketing mix, and value propositions 4. Assessing Competitors’ Stregths and Weaknesses : resources, capabilities, and past performance 5. Estimate competitors reactions 6. Select competitors to Attack or Avoid Approaches to adapt strategies in response to market changes Competitive moves impact how firms go to market... Market Leader Strategies: aggressive marketing strategies (such innovation and market expansion) à reinforce their position & fend oR competitors Market Challenger Strategies: frontal attacks (direct competition) or flanking attacks (targeting competitors' weak spots) Market (fast-) Follower Strategies: imitation or diRerentiation to capitalize on the leader's success while minimizing risk and investment. Market Niche Strategies: specialized segments of the market where they can compete eRectively, often by oRering products/services tailored to specific needs. 31 Market structures have an impact on competitive moves Market structures can evolve over time due to many factors (new entrants, regulations, entry/exit barriers, brand strength, fixed costs...) 32 1985 - Porter's Generic Strategies model – Main strategic options 1995 - Value Disciplines 1995 – 2005 - Digital disruptors brought a new set of dynamics & players 33 2005 -2010 – Blue ocean strategy Rigidity: much more dynamic nature Single strategy only: combine strategies Clear industry limits: blurred industry boundaries Individual firm: entire ecosystems of players Existing markets: value chains, sharing economy & disintermediation => Creating new markets/industries Blue Ocean Red Ocean All the industry not in existence today All the industries in existance today Demand is created Boundaries defined and accepted Opportunity for growth (profitable & rapid) Competitive rules of the game are known Competition is irrelevant bc the rules are Companies try to outperform their rivals waiting to be set à grab a greater share of existing demand Describe wider, deeper, potential to be Market space get crowded found in unexplored market space à profits & growth are reduced Products à commodities à cutthroat or “bloody” competition Value Innovation = simultaneous pursuit of diRerentiation and low cost equal emphasis on value and innovation Four Action Framework à reconstruct buyer value 34  3 tiers of Nonconsumers 6.3 Blue Ocean strategy cases Marvel case citizenM case 35 6.4 Business Model innovation – Canvas & key patterns BMC Unbundled à Tailored marketing à Brand positioning à Cross-selling opportunities à Clear messaging Long tail à Niche targeting à SEO/content marketing à Personalization Multi-sides platforms à Customer segment diRerentiation à Building trust à Network eRects Free à Viral growth tactics à Conversion optimization à Ad-supported marketing Open business models à Co-creation marketing à Crowdsourcing campaigns à Leverage external endorsements 36 6.5 Summary New strategic thinking complements previous frameworks... 37 7 Research & Insights (4) 7.1 Marketing research 7.1.1 Objective 1 : Problem identification Seeking to understand and/or to anticipate Seeking to understand ≠ types of “knowns – unknowns” 7.1.2 Objective 2 : Problem solving Research leading to better decisions 7.1.3 What is Marketing Research ? Function that links the consumer, customer, and public à marketer through information à Define opportunities and problems; generate, refine à Evaluate actions Information à Method => Understanding of the consumer/customer Wider scope of practice Providers of research services 38 Main sources of data Secondary = already collected Primary for a specific research objective o Qualitative o Quantitative : In the digital era: strong focus on quantitative methods 7.2 Shift to Big Data / Analytics and AI 7.2.1 What is data ? = information, especially facts or numbers, used as a basis for decision-making, reasoning, discussion, or calculation = information in digital form that can be transmitted, stored or processed by a computer Data is Big (Volume), Fast-Growing (Velocity) and Unstructured (Variety) Yet, advanced analytics & AI create value potential Marketing & Sales represents a substantial potential value impact from using advanced data and AI personalization, real-time pricing, improved targeting of individualized “next-best” oRers, tailored service, churn prevention, anticipating customer risk... à Value opportunities 7.3 From data to insight to action Big Data remains widely untapped Poor data usage because of... Lack of clear data strategy InsuRicient data quality Inadequate data infrastructure Limited data/analytics skills Fragmented data sources Unable to access real-time data Data privacy concerns Lack of executive sponsorship Many struggle to go... From Data To Insight To Action 39 7.4 Big Data unlocking potential Big Data unlocks new potential... Discrete à always-on Hindsight à foresight 7.5 Challenges of Big Data 7.5.1 Data privacy concerns 7.5.2 Analysis-Paralysis 7.5.3 Lack of Human Insights 40 7.6 Augmenting insights - Complementary disciplines Getting to the WHY?: Other disciplines augment research Sidebar: Correlation versus Causation 7.6.1 EXPLORING HUMAN INSIGHTS - Applied Anthropology in Marketing Ethnography A branch of anthropology A systematic study of individual cultures Natural setting + Participant observation Characteristics Challanges Observed Action in Context Insight confusion In-depth and open Business logic Social Silences Mindset shift Integrating Big Data and Thick Data WHAT people do WHY people do it Data Science & AI Anthropology/Ethnography Big data / quant Thick data / qual Hypothesis-driven Observation-driven Analytical methods Experiential immersion Vast amount of data Smaller samples Extrapolation Exploration Linear Iterative Leveraging mixed research methods 41 7.6.2 INTEGRATING PSYCHOLOGY Behavioral Economics and Marketing => study of the psychological and cognitive factors involved in the decisions Bounds of rationality of economic agents Anchoring eRect = phenomenon in which an individual's judgments or decisions are influenced by a reference point or "anchor" which can be completely irrelevant. Endowment eRect = application of prospect theory positing that loss aversion associated with ownership explains observed exchange asymmetries. Cognitive bias = systematic pattern of deviation from norm or rationality in judgment. 7.6.3 TAKING INSIGHTS EVEN FURTHER - Neuroscience applied in Marketing Appealing to all sense Linking to brain functions Appealing to the subconscious à Responses to stimuli à eRective commercial campaigns Regulatory and ethical scrutiny 42 8 Digital & Social (6) 8.1 Guest speaker: Performance Marketing Stephanie Timpe Senior Digital Marketing Consultant 8.2 Digital & Social media definitions Digital marketing is the application of digital media, data and technology integrated with traditional communications to achieve marketing objectives. Digital media are content and interactive services delivered by diRerent digital platforms including the Internet, web, mobile, TV and digital signage. E-commerce relates to all financial/informational electronically mediated exchanges between an organization and its external stakeholders. E-commerce and Digital Marketing are distinct. o Social commerce is a subset of e-commerce encouraging customer interaction and participation rating, selecting and buying products through group buying Content marketing creates valuable, informative, and engaging content on digital media (and beyond) to attract and retain audiences. Social media marketing refers to the use of social media platforms, where users build networks and share information to achieve marketing objectives. o Influencer marketing is a form of social media marketing involving endorsements from influencers, who are an alleged expert or a person of influencer in their field § From celebrity endorsement to micro- and nano- influencers § Partnership are based on authenticity, trust and long-term relations § Expansion of the Creator Economy estimated to $250 billion in 2023 ARiliate marketing is an advertising model in which a company compensates a third-party publisher (=aRiliate) to generate traRic/leads for its products & services Search engine optimization (SEO) is the process of improving the quality/quantity of (unpaid) website traRic to a website or a web page from search engines. Pay-per-click (PPC) is a form of online marketing where advertisers pay each time a user clicks on one of their ads. 43  Three intersecting key online/digital media types Paid media: Also known as bought media, a direct payment occurs to a site owner or an ad network when they serve an ad, a sponsorship or pay for a click, lead or sale generated. Owned media: DiRerent Earned media: The audience is reached forms of online media through editorial, comments and sharing controlled by a online without any payment of the company/brand including company e.g. a consumer leaving a their website, blogs, positive review. email list and social media presence 8.3 Evolution and ecectiveness 44 8.4 Benefits & challenges Benefits Challenges 1) Global reach & scale at fast speed 6) Too much noise, over-saturated 2) Generallymorecost-eRective 7) Reputation risks viaviral eRects 3) Real-timeperformancetracking 8) Data privacy & regulations 4) Data-ledhyper-personalization 9) Rapidly Evolving Technology 5) Flexibilityandadaptabilitybased on 10) Seamless and secure CX across all sudden market changes... channels diRicult to achieve 8.5 Omni-channel marketing Omnichannel marketing = Integrating Traditional and Digital Marketing à the two should coexist with interchanging roles 8.6 Selected trends D2C business model (Direct to Consumer) à they must rely heavily on digital marketing and E-commerce capabilities 45 9 Emerging technology (7) 9.1 Emerging technology transforming industry, customer and marketing 9.1.1 Industry Economics foundation: Technology as growth engine Technology innovation has been a key enabler economic production transactions Industrial Revolution + devpt capitalism à drive productivity boosts à new customer experience à reshaping of entire industries/creation of new markets Economics foundation: Creative destruction = disruptive technologies and innovation à Dynamism Joseph Schumpeter Old technologies and the firms that do not adapt are swept away by the new BECAUSE they cannot compete in the market by selling goods at a price that covers the cost of production The failure of unprofitable firms releases labor and capital goods for use in new combinations. Nowadays, creative destruction is most often used to describe disruptive technologies and innovation 9.1.2 Marketing All of strategic marketing 46 9.1.2.1 Marketing 6.0 Immersive (Philip Kotter) 9.1.2.2 Quantum Marketing (Raja Rajamannar) Exponential disruptions o Quantum marketing is powered by technologies. o The past models alone will not be able to explain future reality. o The speed, scale and impact of Quantum Marketing are unprecedented. What will change ? o Loyalty will be completely transformed o Advertising will radically change o The agency ecosystem will be disrupted o Marketing will be fragmented o Purpose will move o Ethics and values will gain significant prominence. o Crises will happen more often DATA – more than ever before AI (Artificial Intelligence) – the ultimate marketing propellant 5G – a quantum speed upgrade BLOCKCHAIN – Virtual record keeping IOT (Internet of Things-, smart speakers & plenty others – Technology’s big bang AR & VR (Augmented Reality & Virtual Reality) – additional layers improving CX ROBOTICS & DRONES – game changer for the fourth ‘P’ (place/distribution) SCIENCES – multisensory marketing The future o Personalized o Authentic o Partnerships driven o Purpose led o Ethical 47 9.2 Data, AI and GenAI for Marketing Value can be achieved gradually – e.g. consumer marketing Use Challenges Personalization & tailored experiences Biais Content creation, production and Blackbox localization Liability Marketing Strategy - Portfolio decisioning Distrust Marketing Strategy - Market & Customer Automation research Environmental Impact Product & Service Innovation Digital & Social Media Marketing Marketing Optimization For Marketers to seize opportunities and address risks 48 9.3 More technologies... Augmented Reality is a technology that superimposes a computer-generated image on a user's view of the real world, thus providing a composite view. Opportunities Challenges Helps in entertaining and educating Expensive, time-consuming, and diRicult customers and can aid in evaluating to implement Promote online channel adoption Lack of talent and expertise Benefits products that are less popular Rapid changes in technology. and more expensive. Virtual Reality is a computer- generated simulation that visually immerses a person into another reality or environment. Metaverse is a virtual-reality space in which users can interact with a computer- generated environment and other users. 5G à Real- time analytics à Give consumers real-time solutions à Create a high level of personalization à Contextually appropriate and relevant. à Interaction and engagement IoT is the extension of internet connectivity into physical devices and everyday objects which in turn provide data to marketers....and many more Blockchain Wearables 3D printing Robotics and drones Connected and automated cars Holographic projection 9.4 Implications for CMOs In conclusion, critical implication for Marketers... 49 10 Agile Marketing 10.1 Why agility? The future of marketing is constantly evolving...and its is faster, more unpredictable & more complex To adapt to these fast changes companies, need to develop marketing adaptability and agility 10.2 Marketing Operating Model = how an organization delivers value to its customers or beneficiaries as well as how an organization runs itself. Marketers must find innovative ways to create more touchpoints develop new talent all while improving ROI new capabilities build strong teams deploy cutting-edge technologies Today's marketing requires velocity: speed with direction. New operating model Why ? Capabilities in Data, Analytics, bridge between strategy and execution Automation, Metrics & Technologies ensures that internal processes are aligned Clear organisational structure even more important for global companies Partners interaction between each of the components What are the key components? à agile 50  Core / diRerentiating capabilities Processes & workflows Organization Technology (incl. infrastructure) Governance and decision-making People and culture Performance management 10.2.1 Organization & stucture Successful marketing requires the right strategy and an outstanding team ERective marketing organization structure à the business to the next level StaR knows exactly o What is expected of them o Their jobs and their roles à work as one There is no one-size fits all marketing organization structure consider aspects Own characteristics (company size, industry...- Alignment with business goals Customer centricity Specialization vs. Integration Flexibility and adaptability 10.2.1.1 Functional Structure = By function 51 10.2.1.2 Product-based Structure 10.2.1.3 Geographical Structure 10.2.1.4 Market-/Customer-based structured based on industry, markets, business size 10.2.1.5 Customer stage Beyond structure... - Star Model (Jay Galbraith) à helps companies holistically create the organization necessary to sustain a company's business models and value propositions over time. It was developed by Jay Galbraith an organizational theorist, consultant and professor at IMD. The current culture and leadership styles are key. 52 10.2.2 Tech-powered op models Reliable, holistic and integrated customer and market data If in an industry where customers can be anonymous, the best technology platform cannot be used optimally. To access/grow insights o Digital solutions o Digital marketing o In-person actions o Partnerships / providers of marketing technologies à highlights the complexity in terms of investment decisions and digital skills gaps that CMO face 10.3 Agile Marketing era full of VUCAH - volatility, uncertainty, complexity, ambiguity and hyper connection Companies need to match the speed of customers shifts and outpace the competition at the same time. à Agility Software – AgileManifesto à evolvedout ofthe software development industry => improve industrial processes and manufacturing Just In Time delivery = Always focusing on the customer and continuous improvement. incremental and iterative development 'Minimum Viable Product' (MVP) Small multi-disciplinary teams to be responsible end-to-end Continuously improving itself and adapting to change incremental, measurable, and compatible flexibility, iteration, and speed => better results Certain kind of mindset 53 It’s not for all teams not for all companies Agile and consistency go together 54  10.3.1 Five critical trade-o>s Marketing needs to find a way Organize customer Creating deeper Adidas : Nike to balance both facing product teams insights into redesigning its Access to Expertise continued growth of core around growth and local shopping operating model Cost E_iciency products/services shared services habits and to support this Fresh Perspectives developing new ones teams for e_iciency cultural shift to DTC and Scalability Challenges for new product and scale. expectations create flexibility Advanced development: Partnering with to respond to Technologies Market Fit Using digital content local players, changing Risk Mitigation Customer Risk creation and e.g., Tesco’s consumer Reputational Damage personalization to joint venture behaviors Cannibalization risk adapt real-time to partnership with upskilling the Financial Risk changes and scale Samsung - a workforce them rapidly via leading Korean Regulatory Risk digital platforms firm - was very Operational Risk throughout all the successful. organization Better market Solutions Agile marketing research on organization structure competitors. New brand (stand-alone) Tailored marketing mix Agile processes better to the Ongoing performance local tracking consumers Strategic partnerships or (store CX, investments product o_er...). Focus on agility Potential pitfalls to mitigate McDonald’s Higher overall marketing balances its costs global brand Lack of trust and ‘standard Missed synergies menu’ with Talent motivation localization. Governance duplication 55 10.4 Power of partnership (internal/external) Internal external CEO Agency partnerships CFO/Finance It connect with the hearts and souls of consumers. CIO/IT/Digital Legal/Risk They need to understand completely what the vision is, the strategy, Sustainability/ESG the priorities and the existing constraints. Internal Comms HR/Talent A strong agency ecosystem is essential CMO and Marketing / complex marketing and communications - / nbr of agency teams can benefit from close collaboration Innovation partnerships Technology partnerships Media partnerships evolution of the channel landscape ecosystem (interactions) à challenge : attribution Stage of the funnel Passion partnerships – sponsoring Sponsorship Patronage Public-Private Partnerships (PPP) Industry and trade partnerships Local community partnerships Part-time, free-lance workers partnerships 56 Co-Branding Combine their brand equity—their logo, name, and reputation in the market—into a single product or service Across their combined audiences + Benefit from each other’s reputation + Engage with current customers in a fresh and innovative way + Grow their community + Increase sales + Win new customers + Boost awareness, extend their visibility to a market they may not have had access to + Strengthen their brand equity/credibility Co-Marketing Mutually beneficial strategic partnership with a non-competitive business Align their marketing eRorts to promote each other’s product or service / visibility, reach, and sales Equal value Does not result in the creation of a new product or service Valuable for all brands that want to widen their audience, increase brand awareness, and oRer a new type of content to their customers + Reaching new audiences of potential customers + Cutting costs by pooling together resources + Selling more products + Generating press coverage + Expanding network + Building valuable long-term relationships Types ARiliate Marketing Distribution Partnership Product Placement Licensing Agreements Event Sponsorships Content Marketing Partnerships Loyalty Marketing Programs/contests Referral Agreements 57 Co-Creation = involving a brand’s audience in the creation of a new product or service Collaborative co-creation is to promote the culture of sharing ideas à Understanding of the target audience à Be customer-centric à Build a powerful community à Opportunities 58