Marketing Management PDF

Course Info 3. Augmented Product Professor: Fernando Soria Prados ➔ Delivery & Credit → Book: The way you put the...

Course Info 3. Augmented Product Professor: Fernando Soria Prados ➔ Delivery & Credit → Book: The way you put the product in General Information consumers’ hands 25 Sessions ➔ Product Support 10 days for HW/viewing of ➔ Warranty materials ➔ After sale service Dates: Service = Intangible product that consists Intermediate 1 - 3% of activities, benefits, or satisfactions Intermediate 2 - 3% Intermediate 3 - 3% Products & Services ➔ Ownership differentiates the two Practical Case 1 ➔ Becoming more commoditised Practical Case 2 ➔ Companies create & manage experiences PART I: Introduction to the course ➔ Consumer products = Final buy Session 1 for final consumption ◆ Convenience: Bought immediately and frequently PART II: The Four Pillars of w min comparison and Marketing Mix buying effort Session 2 - 16 Accessibility is key Distribution is Strategy is necessary before working on important the 4Ps ◆ Shopping: Less frequently purchased that customer 8.1 WHAT IS A PRODUCT? carefully compares Product = Anything that can be offered in suitability, quality, price, & a market for attention, acquisition, use, or style consumption that can satisfy a want or ◆ Specialty: Unique need characteristics + brand ➔ Levels identification that a 1. Core Customer Value significant group of buyers ➔ What the customer is willing to make a special is really purchasing purchase effort ➔ The basic need of Ex. Med services, the customer designer products, ➔ Ex. Ikea sells & high-end design, modernity, electronics and flexibility ◆ Unsought: Not typically 2. Actual Product thought of being bought by ➔ Brand name consumers ➔ Quality level ➔ Packaging ➔ Design ➔ Features  ➔ Services are continuously paid for ➔ Companies can utilise data gathered from digital services Services → Products ➔ Services are difficult to be tangible ➔ Typically used to maintain contact & build loyalty among customers ◆ Can be done through partnering w a tangible product ➔ Industrial products = Purchased for further processing or for use in 8.2 PRODUCT & SERVICE conducting a business DECISIONS ◆ Materials & Parts: Raw & Product Decisions manufactured materials & parts ◆ Capital Items: Industrial products that aid in production & operations ◆ Supplies and services: Operating supplies, repair & maintenance items, and ➔ Product Attributes = How to business services communicate and deliver benefits ➔ Classifications - “Activities ◆ Quality: Characteristics that undertaken to create, maintain, bear on its ability to satisfy or change the attitudes & stated or implied customer behaviour of target consumers”: needs ◆ Organisation marketing: Total qual toward an organisation management Creating a brand Return-on-qual image Qual level ◆ Person marketing: toward Performance qual particular people Conformance qual Personal branding Ex. Nike collabing w Ex. LinkedIn Arab athletes on the ◆ Place marketing: toward design & style of its particular places sports Hijab ◆ Social marketing: toward ◆ Features: Competitive tool influencing individuals’ for differentiation behaviour to improve their Assessed based on well-being and that of value to the society customer vs. cost to Uses commercial the company marketing concepts ◆ Style: Appearance ◆ Design: Usefulness & looks Products → Services ➔ Brand = Name, term, sign, or ➔ Products are bought once design (or combination) that  identifies the maker or seller of a ➔ PM Width = Amount of PLs in a product or service PM ➔ Packaging = The container/wrapper of a product ◆ Labels & INFO received from packaging ◆ Helps identify the brand ◆ Part of consumer experience ➔ Labels & Logos = Identify product/brand, describe attributes, and provide promo ➔ Support & Services = Augment products Product Line Decisions ➔ Consistency = Should make ➔ Product Line = Group of products sense w everything a company is that are closely related selling ◆ Function in a similar manner 8.3 SERVICES MARKETING ◆ Sold to the same customer Service Industries segments 1. Government ◆ Marketed in same outlet 2. Private NGOs types 3. Business Organisations ◆ Fall within a similar price range 4 Service Characteristics ➔ PL Length = Number of items in the line ◆ Line filling: Adding more products Minimise gaps that competitors may take advantage of Ex.: Selling leather Inseparability belts/shoes ➔ Product cannot be separated from ➔ PL Depth = Number of products company under a product type ➔ Ex. Renting a car ◆ Line stretching: Expanding a product range Perishability Ex.: Offering new ➔ Services cannot be stored leather colours for a ➔ Ex. Staying at a hotel specific bag ➔ Allows you to differentiate your Variability products catering to diff customers ➔ Services depend on who is delivering it Product Mix Decisions ➔ Product Mix = Consists of all the PLs and items offered Marketing Strategies for Service Firms Employee hiring & = Heavily based on how employees are training trained Service quantity & quality 8.4 BRAND STRATEGY: BUILDING STRONG BRANDS Brand Equity = A measure of the​brand's ability to capture consumer preference and loyalty ➔ Service-profit Chain: Links profits ➔ Differential effect that knowing the with employee & customer brand name has on customer satisfaction response to the product or its ◆ Internal service qual marketing ◆ Satisfied & productive ➔ Different amt of money paid bc of service employees the brand ◆ Greater service value ◆ Satisfied & loyal customers Brand Value = Total financial value of the ◆ Healthy service profits & brand growth ➔ Difference between balance sheet ➔ Internal Marketing: Service firm value vs stock value is the value of orient and motivate its the brand customer-contact employees & supporting service people to work as a team to provide customer satisfaction ◆ Employee training ➔ Interactive Marketing: Service quality relies on the quality of the buyer-seller interaction during the Brand Positioning service encounter ➔ Levels: ◆ Service differentiation → ◆ Attributes Managing creates a ◆ Benefits competitive analysis ◆ Beliefs & Values Offer Delivery Brand Name Selection = Selection & Image Protection ◆ Service quality → ➔ Suggests benefits & qualities Managing enables a ➔ Easy to pronounce, recognise, & service firm to differentiate remember itself by delivering ➔ Distinctive consistently higher quality ➔ Extendable than its competitors ➔ Translates for the global economy ◆ Service productivity → ➔ Capable of registration & legal Managing refers to the cost protection side of marketing strategies for service firms Brand Sponsorship ➔ Manufacturers brand: 4 brand Idea Generation = Systematic Search for sponsorship options new product ideas ◆ National – ➔ Sources: ◆ Private (store/distributor) – ◆ Internal → Company’s own ◆ Licensed – formal R&D, management ◆ Co-branding – & staff, and intrapreneurial ➔ Private brand programs ➔ Licensed brand ◆ External → Customers, ➔ Co-brand competitors, distributors, suppliers, & outside design Brand Development firms ➔ Line extensions ◆ Crowdsourcing → Invite ➔ Brand extensions broad communities of ➔ Multibrands people (customers, ➔ New brands employees, independent scientists & researchers, Unit 8 Additional Resources: and the public) into the new Goal Setting product innovation process 9.1 NEW PRODUCT DEVELOPMENT Idea Screening STRATEGY ➔ Identifying & choosing good ideas Ways to Obtain ➔ It is okay to fail ➔ Acquisition: purchase of a whole ◆ Basta low-cost company, patent or a licence to ➔ R-W-W produce someone else’s product ◆ Is it Real? ◆ Acquired for brand equity ◆ Can we Win? ◆ If a company acquires a ◆ Is it Worth doing? brand w brand equity, but does not put its own brand, Concept Development & Testing it is for power in trade ➔ Product Idea: Possible products ➔ New product development: original the company is considering selling products, product improvements, ➔ Product Concept: Detailed version product modifications, & new of idea in consumer terms brands developed from the firm’s ➔ Product Image: How consumers own research & development perceive an actual/potential ➔ Companies prefer innovative product manufacturers bc they pull in more ➔ Concept Testing: Testing new customers product w groups of target 9.2 NEW PRODUCT DEVELOPMENT consumers PROCESS Marketing Strategy & Development = Initial marketing strategy for a new product based on the product concept ➔ Marketing Strategy Statement: ◆ Target market description ◆ Planned Value Prop  ◆ Sale, market-share, & together, overlapping steps in the marketing mix process to save time and increase effectiveness. Business Analysis = review of the sales, ➔ Systematic New Product cost, & profit projections for a new product Development: to discover if it satisfies the company’s ◆ Innovation management objectives system Innovation-oriented Product Development = Develop the company culture concept into a physical product to ensure Yields a large that it can be turned into a workable number of new market offering product ideas ➔ New Product Development in Test Marketing = The stage of new Turbulent Times: product development wherein the product ◆ Tempted to reduce and its proposed marketing program are spending tested in realistic market settings ◆ May become less ➔ Likely: competitive ◆ New product with large investment 9.3 STAGES OF THE PRODUCT ◆ Uncertainty about product LIFE CYCLE & MARKETING or marketing program STRATEGIES ➔ Unlikely: ◆ Simple line extension 10.1 WHAT IS A PRICE ◆ Copy of competitor product Marketing = Process of companies ◆ Low costs creating value for customers ◆ Management confidence ➔ Build strong customer relationships ➔ Capture values from customers in Commercialisation = Introducing a new return product into the market ➔ Good to follow trends ➔ When to launch? ➔ Where to launch? Marketing Model ➔ Planned market rollout? Successful New Product Development ➔ Customer centred ➔ Team based ➔ Systematic Managing New Product Development ➔ Customer-Centred New Product Development: Finding new ways to solve customer problems & creating more customer-satisfying Price = amt of money charged for a experiences product or service ➔ Team-Based New Product ➔ Sum of all values that customers Development: various company exchange for the benefits of departments working closely owning/using a product/service  ➔ Only element of MMix that offer rev Cost-Based Pricing = Sets prices based ◆ Tactical tool on the costs for producing, distributing, & ➔ One of the most flexible elements selling the product within MDecisions ➔ Fair return rate for effort & risk ➔ Based on how customers perceive ➔ Product-driven the value of the product ➔ Fixed Costs: costs that do not vary ➔ Understand whether or not it is the with production/sales level perceived value your consumer is ◆ Rent is truly searching for ◆ Heat ◆ Interest 10.2 3 MAJOR PRICE STRATEGIES ◆ Executive salaries ➔ Variable Costs: directly vary with production/sales level ◆ Raw materials ◆ Packaging ➔ Total Costs: F+V for any given Customer Value-Based Pricing = level of production Buyer’s perceptions of the value > seller’s ➔ Competition - market-driven cost ➔ Price is set to match perceived ➔ Customer driven value ➔ Price set to match perceived value Types of COST-BASED PRICING: 1. Cost-plus Pricing: Adds a standard markup to the cost of the product Benefits: ○ Sellers are certain about costs ○ Price competition is minimised Types of CUSTOMER VALUE-BASED ○ Buyers feel it’s fair PRICING: Disadvantages: 1. Good-value Pricing: Right ○ Ignores demand combination of quality & good and competitor service at a fair price prices 2. Everyday Low Pricing (EDLP): 2. Break-even Pricing: Pricing to Charging a constant everyday low make target return price with few or no temporary discounts 3. High-low Pricing: Charging higher prices on a daily basis, but often running sales on temporary selected items 4. Value-added Pricing: Attaches value-added features & services to Competition-based Pricing = Setting differentiate the companies offers prices based on competitors’ strategies, & thus justify their higher prices costs, prices, & market offerings ➔ Market driven 10.3 EXTERNAL AND INTERNAL The Economy and Other External FACTORS Factors Target Costing = Ideal selling price based ➔ Economic conditions on consumer value considerations, and ➔ Reseller’s response to price then target costs that will ensure that the ➔ Government price is met ➔ Social concerns > Who should set prices? 11.1 MAJOR STRATEGIES FOR > Who can influence prices? NEW PRODUCTS ↓↓ New Pricing Strategies Dependent on different industries though ➔ Market-skimming pricing: ↑ initial Marketing generally owns the pricing prices to skim revenue layers from process the market ◆ Product quality and image The Market and Demand must support the price ➔ Before setting prices, the ◆ Buyers must want the relationship between price and product at the price demand must be understood ➔ Market-penetration pricing: ↓ price ➔ Pricing in DIFFERENT TYPES for new products to attract more OF MARKETS: buyers, ↑ market share ◆ Pure Competition: Many sellers, similar product + 11.2 MAXIMISE PROFIT price Product Mix Pricing Strategies ◆ Monopolistic Competition: 1. Product Line Pricing = Considers Many companies offer cost differences between products similar products, but not in the line, customer evaluations of perfect substitutes features, and competitors’ prices ◆ Oligopolistic Competition: 2. Optional Product Pricing = Takes Few sellers, differentiated into account optional or accessory products, each seller has products along with main product high market share 3. Captive Product Pricing = Sets Sellers cannot prices that must be used along ignore moves of with the main product (i.e. competitors nespresso pods & machines) ◆ Pure Monopoly: Price 4. By-product Pricing = Prices maker – sets market price by-products to make main due to a lack of competition product’s price more competitive ➔ Demand–Price = ↑↓ 5. Product Bundle Pricing = ➔ Price Elasticity of Demand: Combines several products at a ◆ Inelastic Demand: Demand reduced price barely changes when price does (i.e. Luxury goods) 11.3 PRICE ADJUSTMENT ◆ Elastic Demand: Demand Discount and Allowance pricing = greatly changes when Reducing prices to reward customer prices do (i.e. Daily responses such as volume purchases, groceries) paying early, or promoting the product Segmented pricing = Adjusting prices to but charges the allow differences in customers, products, same delivery fees or location in Asia as they do in ➔ Market must be segmentable the West ➔ Segments must show different ◆ Zone: Company sets up 2+ degrees of demand zones where customers ➔ Costs of segmenting cannot within the given zones pay exceed the extra revenue the same ➔ Must be legal ◆ Basing-point: Seller selects ➔ Types of Pricing: a certain city as a base ◆ Customer-segment point, and charges ◆ Product-form customers the freight from ◆ Location-based that city to their city ◆ Time-based I.e. a seller in Cebu will charge less to Psychological pricing = Considers transport to psychology of the prices – price is used to Batangas than they say something about the product would someone in ➔ Reference Prices = Prices buyers Muntinlupa keep in mind, and refer to when ◆ Freight-absorption: Seller looking for a specific good absorbs all/ part of the freight charges to gain Promotional pricing = Temporarily desired business lowering prices to below list (and sometimes cost) prices to boost short-run Dynamic pricing = Continuously altering sales prices to meet the characteristics and ➔ Special-event pricing needs of individual customers and ➔ Limited-time offers situations ➔ Cash rebates ➔ Online: Benefits both the seller and ➔ Low-interest financing, extended consumer because customers get warranties, or free maintenance direct access to products which could be cheaper than in-store Geographical pricing = Used for customers in different parts of the world International pricing/prices = Changing ➔ Types of Geographical Pricing: pricing strategies from country to country ◆ FOB-origin: Free On Board ➔ I.e. Big macs are priced differently – Merchant pays for per country according to the shipping to customer’s area demand of the people Customer then pays for transpo from shipment point to final location (their place) ◆ Uniform-delivered: Charge same price + freight to all (regardless of location) I.e. Triangl manufactures in HK, 11.4 RESPONDING TO PRICE ◆ ↑ quality, and ↑ price CHANGES ◆ Launch a lower-price Initiating Price Changes “fighting” brand ➔ Price cuts occur due to: ◆ Excess capacity 11.5 SOCIAL AND LEGAL ISSUES ◆ ↑ Market share Pricing Within Channel Levels ➔ Price increases occur due to: ➔ Price Fixing: Legislation requires ◆ Cost inflation sellers to set prices without ◆ Increased demand discussions amongst themselves ◆ Lack of supply and competitors ➔ Predatory Pricing: Legislation Buyer’s Reactions (Opinions from their prohibits selling below cost with the POV) intention of punishing a competitor ➔ ↑Price Increases: or gaining higher long-term profits ◆ Product is “hot” by putting competitors out of ◆ Company greed business ➔ ↓Price Cuts: ◆ There should be no ill intent ◆ New models will be towards competitors when available lowering prices ◆ Models are not selling well ◆ Quality issues Pricing Across Channel Levels ➔ Robinson-Patman Act: Ensures Competitor Reactions that sellers offer the same price ➔ Why did they change the price? terms at a given level of trade in ➔ Is the cut permanent or temporary? order to avoid unfair price ➔ Is the competitor trying to grab discrimination market share? ➔ Price Discrimination is ALLOWED ➔ Is the company performing poorly, if the seller: and trying to increase sales? ◆ Can prove that costs differ ➔ Is it a signal to decrease industry when selling to different prices to stimulate demand? retailers ◆ Manufactures different Responding to Price Changes qualities of the same product for different retailers ➔ Retail (or Resale) Price Maintenance: Manufacturer requires a dealer to charge a specific retail price for its product, which is prohibited by law ➔ Deceptive Pricing: Seller states prices or price savings that mislead ➔ Effective Action Response: consumers or are not actually ◆ Reduce price to match available to consumers competition ◆ False reference or ◆ Maintain price, but raise the comparison prices perceived value through ◆ Scanner fraud and price communications confusion 12.1 WHY COMPANIES USE MARKETING CHANNELS Supply Chains & Value Delivery Networks ➔ Upstream: Partner firms that supply raw materials, components, parts, information, finances, and distribution, financing, take expertise needed to create a risks product or service ◆ Promo → Will the company ➔ Downstream: Marketing or be happy or not about distribution channel partners that putting the items on sale? look toward the customer, including ◆ Matching → Match quantity wholesalers and retailers stock wanted by consumers ➔ Supply Chain: “Make & sell” ◆ Raw materials, productive Channel Level = Layer of intermediaries inputs, & factory capacity that performs some work in bringing the ➔ Demand Chain: “Sense & respond” product and its ownership closer to the ◆ Planning starts w the needs final buyer of the target consumer ➔ Value Delivery Network: Direct Marketing = No intermediaries Composed of the company, suppliers, distributors, and Indirect Marketing Channel = 1+ customers who partner with each Intermediary levels other to improve the performance of the entire system The Nature and Importance of Marketing Channels ➔ Marketing (Distribution) Channel: Is a set of interdependent organisations that help make a product or service available for use or consumption by the consumer Channel Flow Connections: or business user ➔ Physical flow of products ➔ How Channel Members Add Value: ➔ Flow of ownership ◆ Transform the assortment ➔ Payment flow of products into ➔ Information flow assortments wanted by ➔ Promotion flow consumers ◆ Bridge the major time, 12.2 HOW CHANNEL MEMBERS place, and possession gaps that separate goods and INTERACT - Channel Behaviour services from users Marketing Channels = firms that have ◆ Inform, promote, contact, partnered for their common good with match, negotiate, physical each member playing a specialised role Channel Conflict = Disagreement among Horizontal Marketing Systems (VMS) = members over goals, roles, rewards Channel arrangement in which 2+ ➔ Horizontal Conflict companies at one level join together to ➔ Vertical Conflict follow a new marketing opportunity Conventional Distribution Systems = 1+ independent producers, wholesalers, and Multichannel Distribution Systems = 1 retailers firm sets up 2+ marketing channels to ➔ Each separate business seeking to reach 1+ consumer segments maximise its own profits, perhaps even at the expense of profits for Disintermediation = Cutting out of the system as a whole marketing channel intermediaries, or the replacement of traditional resellers by new Vertical Marketing Systems (VMS) = intermediaries Provide channel leadership ➔ Consist of producers, wholesalers, 12.3 ALTERNATIVES and retailers acting as a unified Marketing Channel Design = Effectively system done by: ➔ Types of MARKETING SYSTEMS: ◆ Corporate → Combine successive stages of production & distribution under single ownership ◆ Contractual → Independent firms at different levels of production & distribution who join together through contracts ◆ Administered → Coordinates successive Analysing Consumer Needs stages of production & ➔ Find out what target consumers distribution through the size want from the channel & power of one party ➔ Identify market segments ➔ Under Contractual VMS is ➔ Determine the best channels to Franchise Organisation use ◆ A Franchisor (channel ➔ Minimise the cost of meeting member) links several customer service requirements stages in the production-distribution Setting Channel Objectives process ➔ Determine targeted levels of customer service  ➔ Balance consumer needs against ➔ Economic criteria costs and consumer price ◆ Costs preferences ◆ Efficiency ◆ ROI Identifying Major Alternatives ➔ Control issues ➔ Types of intermediaries: Channel ◆ Channel power dynamics members available to carry out ◆ Brand image and channel work positioning ➔ Most companies face multiple ◆ Channel conflict channel member choices ➔ Adaptability Criteria ➔ Types of MAJOR ALTERNATIVE ◆ Market changes DISTRIBUTION: ◆ Tech integration ◆ Intensive – Sells in as ◆ Scalability many places possible ◆ Exclusive – Only one Designing International Distribution distributor to carry out in a Channels definite region ➔ Channel systems vary from ◆ Selective – Select networks country to country of retailers, resellers, and ➔ Marketers must be able to adapt wholesalers channel strategies to structures ➔ Responsibilities of Channel within each country Members: Producers and intermediaries need to agree on 12.4 Select, Motivate, Evaluate ◆ Price policies ◆ Conditions of Sale ◆ Territory Rights ◆ Specific Services Expansion on Networks Retailers = Buy from manufacturer or wholesaler, and sell to end user ➔ Store Advertising ➔ Inventory Management ➔ Creating a Shopping Experience Public Policy and Distribution Decisions Resellers = Buy products to resell at a ➔ Exclusive Distribution: Producer higher price gives a limited number of dealers ➔ Typically in bulk exclusive right to distribute its products in their territories Wholesalers = Sells products in bulk to ➔ Exclusive Dealing: Seller requires various outlets and retailers that exclusive distributors not ➔ Directly or through a middleman handle competitor products ➔ Typically in bulk ➔ Exclusive Territorial Agreements: ➔ Intermediary Producer or seller limit territory ➔ Tying Agreements: Dealer must *** take most or all of the line Evaluating Major Alternatives 12.5 MARKETING LOGISTICS AND ➔ To keep customers alive, need INTEGRATED SUPPLY CHAIN services MANAGEMENT Marketing Logistics (Physical 13.1 ROLE OF RETAILERS Distribution) = Planning, implementing, Retailing = All activities in selling products and controlling physical flow of goods, or services directly to final customers for services, and related information from their personal non-business use points of origin to points of consumption ➔ Omni-Channel Retailing: Integrates ➔ To meet consumer requirements at in-store, online, and mobile a profit shopping ◆ Creates seamless cross-channel buying experience ➔ New Retailing Model: Must adopt omni-channel retailing ◆ Tech has caused a shift in how & where people buy Supply Chain Management = Managing Retailers = Businesses whose sales upstream and downstream value-added come primarily from retailing flows of materials, final goods, and related ➔ Self-Service: Serve customers who info among suppliers, the company, are willing to perform their own resellers, and final consumers locate-compare-select process ➔ Goal: Provide targeted level of ◆ Saves money customer service at the least cost ◆ I.e. Walmart, supermarkets, etc. Major Logistics Functions ➔ Limited Service: Provide more ➔ Warehousing sales assistance due to carrying ➔ Inventory Management more shopping goods ➔ Transportation ◆ Customers need more info ➔ Logistics Info Management ◆ I.e. Sears, JC Penney ➔ Full Service: Assist customers in Integrated Logistics Management = every stage of the shopping Recognition that providing customer process service, and trimming distribution costs ◆ ↑Cost passed onto require teamwork internally and externally consumer as ↑price ◆ I.e. Department stores, Major Types Wholesalers specialty stores ➔ Sell ➔ Promote Product Line Classifications - Major ➔ Buy from company (keep stock, Store Retailers = Classified by length and then sell) breadth ; ) ➔ Finance small stock ➔ Specialty Stores: Carry narrow ➔ As they own the product, they take product lines with deep some risk assortments within those lines ➔ Share market info w manufacturers ➔ Department Stores: Carry a wide variety of product lines  ◆ Compete w/ discount stores ◆ Building buyer preferences, – add promo-pricing to convictions, actions, and meet discount threat developing customer ◆ Compete w/ specialty relationships stores – use store brand & ➔ Public Relations: Obtaining single-brand designer favourable publicity by building shops good relations with the company’s ➔ Convenience Stores various public ➔ Superstores ◆ Believable form of ➔ Category Killers promotion ➔ E-commerce ◆ Maintaining good corporate image 14.1 5 PROMOTION MIX TOOLS ◆ Handling or heading off Promotion Mix = Specific blend of promo unfavourable rumours, tools used by organisations to stories, and events persuasively communicate customer value ◆ News stories, features, and build customer relationships sponsorships, & events ➔ Advertising: Any paid form of ➔ Direct and Digital Marketing: nonpersonal presentation and Directly engaging with carefully promotion of ideas, goods, or targeted individual consumers and services by an identified sponsor customer communities ◆ Can reach masses of ◆ Obtain an immediate geographically dispersed response buyers at a low cost per ◆ Build lasting customer exposure relationships ◆ Enables sellers to repeat a message many times 14.2 CHANGING COMMUNICATIONS ◆ Broadcast, print, online, LANDSCAPE mobile, outdoor New Marketing Communications Model ➔ Sales Promotion: Short-term = Marketers are shifting ever-larger incentive to encourage the portions of their marketing budgets away purchase or sale of a product or from old-media mainstays to online, social, service and mobile media ◆ Attract consumer attention ➔ Consumers and marketing ◆ Offer strong incentives to strategies are changing purchase ➔ Advancements in digital ◆ Discount, coupon, cents-off technology deals, display, demonstration Integrating Marketing Communications ➔ Personal Selling: Personal (IMC) = Carefully integrating and interaction by the firm’s sales force coordinating the company’s many for the purpose of engaging communications channels to deliver a customers, making sales, and clear, consistent, and compelling message building customer relationships about the organisation and its products ◆ Most effective method at ➔ Content Marketing: Creating, certain stages of the buying inspiring, and sharing brand process messages and conversations with  and among consumers across a positive or negative fluid mix of paid, owned, earned, emotions to and shared channels motivate purchase ➔ Company must carefully blend Moral Appeal – promo tools into a coordinated directed to an promo mix audience’s sense of what is right & proper ◆ Structure and Format = How to say it? ➔ Choosing Media to Send Message: ◆ Personal Communication – 2+ people communicating directly with one another Mail/email, 14.3 COMMUNICATION PROCESS face-to-face, phone, texting/internet chat, etc. ◆ Opinion Leaders – people whose opinions are sought by others ◆ Buzz Marketing – cultivates opinion leaders, & getting them to spread info about a product or service to others Steps of the Communication Process in their communities ➔ Identify Target Audience: ◆ Non-Personal ◆ What will be said Communication – media ◆ How it will be said that carry messages ◆ When it will be said without personal contact or ◆ Where it will be said feedback ◆ Who will say it Major media, ➔ Determine Comms Objectives: atmospheres, ad ◆ Awareness → Knowledge events → Liking → Preference → ➔ Select Message Source and Conviction → Purchase Collect Feedback: ➔ Design Message: ◆ Message Impact – ◆ A – get Attention dependent on how the ◆ I – hold Interest target audience perceives ◆ D – arouse Desire the communicator ◆ A – obtain Action Celebrities – ◆ Content = What to say? athletes, Rational Appeal – entertainers, etc. relates to Professionals – audience’s healthcare self-interest providers, etc. Emotional Appeal – ◆ Collecting Feedback – attempt to stir up Communicator  understanding the effect on ◆ Conform to all federal, the target audience by state, & local regulations measuring behaviour ➔ Personal Selling: resulting from the content ◆ Follow rules of “fair competition” ◆ Do not offer bribes 14.4 PROMOTION BUDGET ◆ Do not attempt to obtain Setting Promo Budget competitors’ trade secrets ➔ Affordable Method: Sets promo ◆ Do not disparage budget at the level management competitors/their products believes the company can afford ➔ Percentage-of-Sales Method: Sets 15.1 ROLE OF ADVERTISING promo budget at a certain Advertising = Paid form of nonpersonal percentage of current or forecasted presentation and promotion of ideas, sales, or as a percentage of the goods, or services by an identified unit sales price sponsor ➔ Competitive-Party Method: Matches competitor’s outlay ➔ Objective-and-Task Method: Develops promo budget by specific objectives, and the costs of tasks needed to achieve them Shaping the Overall Promo Mix 15.2 DECISIONS Advertising Objective = Specific communication task to be accomplished with a specific target audience during a specific time ➔ Informative Advertising: ➔ Company must take steps to Introducing a new product category ensure that each promo mix to build primary demand element is smoothly integrated ➔ Persuasive Advertising: Important ➔ Various promo elements should to build selective demand when work together to carry the firm’s competition ↑ unique brand messages and ➔ Comparative Advertising: selling points Comparison of the brand to other brands Socially Responsible Marketing ➔ Reminder Advertising: Maintain Communication customer relationships, and keep ➔ Advertising and Sales Promotion: them thinking about the product ◆ Communicate openly & once it has reached maturity honestly with consumers & resellers ◆ Avoid deceptive/false ads ◆ Avoid bait-and-switch ads  ◆ Personality Symbol ◆ Technical Expertise ◆ Scientific Evidence ◆ Testimonial or Endorsement ➔ Tone: Positive or negative? ➔ Attention-getting words ➔ Format: Illustration, headline, or Setting the Advertising Budget copy? ➔ Stage in product life cycle ➔ Market share PART III: Implementation of ➔ Competition Marketing Plan in Digital Age Session 17 - 21 Advertising Strategy = Strategy by which the company accomplishes its advertising objectives 17.1 DEFINE DIRECT AND DIGITAL ➔ Creating advertising messages MARKETING ➔ Selecting advertising media Direct and Digital Marketing = Engage directly with targeted individual consumers Advertising Clutter = Consumers have and customer communities control over what they choose to or to not ➔ Obtain and immediate response watch → Choosing not to watch ads ➔ Build lasting customer ➔ Resolved by merging advertising relationships and entertainment ➔ New Direct Marketing Model: Direct and digital marketing Creative Concept = Compelling “Big constitute a complete model for Idea” that will bring an advertising doing business message strategy to life in a distinctive and memorable way Rapid Growth ➔ Should be: ➔ Direct and digital marketing are the ◆ Meaningful fastest-growing form of marketing ◆ Believable ➔ Direct: More internet-based ◆ Distinctive ➔ Digital Direct: Claims a surging share of marketing spending and Message Execution = When the sales advertiser turns the big idea into an actual ad execution ➔ To capture the target market’s attention and interest ➔ Creative team must find the best approach, style, tone, words, and format for executing the message ➔ Types: ◆ Slice of Life ◆ Lifestyle ◆ Fantasy ◆ Mood or Image Benefits to Consumers ◆ Musical  ➔ Convenient competitors for ➔ Ready access to many products value-for-money ➔ Access to comparative info about ◆ Communication/ companies, products, and Conversation – Must offer competitors 2-way communication ➔ Interactive and immediate channels Benefits to Sellers ➔ Tool to build customer relationships ➔ Low-cost, efficient, fast alternative Strategies to reach markets ➔ Buyer Persona: Semi-fictional ➔ Flexible representation of ideal customer ➔ Access to buyers not reachable ◆ Based on market research, through other channels & real data about existing customer 17.2 MAJOR FORMS ◆ Help focus time on qualified Forms prospects ◆ Guide product development to suit the needs of target customers ◆ Align all work across organisation ◆ To Draft – Uncover trends, identify important persona info, generalisations, what 17.3 INTERNET AND THE DIGITAL customer & prospects like, AGE & primary & secondary data 4P ➡ 4C ◆ Common Mistakes ➔ Product Perspective: ◆ Product – Define the product, service, experience ◆ Price – Where are we selling the product? Online &/or offline? ◆ Placement – Value customer will pay ◆ Promotion – How will the ➔ SMART Goals: Know which product engage with direction to take, and what results customers? were achieved ➔ Consumer Perspective: ◆ Specific – Clear description ◆ Customer – “Product” must ◆ Measurable – Include a be customer-centric target to success ◆ Cost – Should be ◆ Attainable – Challenging, accessible from all devices, but realistic & from anywhere ◆ Relevant – Consistent with ◆ Convenience/Comfort – higher level goods Reviews against  ◆ Time-Based – Set a date to get it ➔ Research, Content Marketing, and Approach: Define value proposition ◆ Research competitors ◆ Define content strategy ◆ Decide on approach – Touchpoints, channels, resources, tools ◆ Consumer – ◆ Competitor – ◆ Trends – ◆ Brand – ◆ Observational tests/ hypothesis – ➔ Analytics: Continuous analysis on platforms ◆ Websites, social networks, customer journeys, newsletters, mobile, etc.