October 7, 2013October 7, 2013

• Ads?Ads?• Understanding the W’s to drive Marketing Understanding the W’s to drive Marketing

MixMix• Positioning Positioning • Assignment for next classAssignment for next class

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Marketing MixMarketing Mix

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PRODUCT

PLACE

POSITIONING

PRICE

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Getting to the Marketing MixGetting to the Marketing Mix

Where

What

Who

Why

When

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WhoWhoWho are we targeting ?

Market segmentation is a powerful tool

• Nearly all markets include groups of people or organizations with different product needs and preferences

• Segmentation helps marketers define customer needs and wants more precisely

• Because market segments differ in size and potential, segmentation helps decision makers more accurately define objectives and better allocate resources

• Performance can be measured more effectively when objectives are more precise

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Successful segmentation: 4 criteria

1.1. A segment must be large enough to warrant developing A segment must be large enough to warrant developing and maintaining a special marketing mix (Size Matters)and maintaining a special marketing mix (Size Matters)

2.2. Segments must be identifiable and their size Segments must be identifiable and their size measurable (Identify & Measure)measurable (Identify & Measure)

3.3. The firm must be able to reach them in some way with The firm must be able to reach them in some way with the marketing mix (Accessible)the marketing mix (Accessible)

4.4. Responds differently than other segments to a Responds differently than other segments to a marketing approach (Uniquely Responsive)marketing approach (Uniquely Responsive)

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Typical Segment Attributes

Geography Demographics Psychographics Benefits Usage Rate

• Region

• Market size

• Market density

• Climate

• Age

• Gender

• Income

• Race/ethnicity

• Family

• Personality

• Motives

• Lifestyle

• Benefits sought • Heavy, Medium, Light users

• First timers

• Repeaters

• Lapsed

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TargetingTargeting

Once you understand the potential segments, you must choose which ones to target…

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TargetingTargeting

Once you understand the potential segments, you must choose which ones to target…

• Number of customers and potential spending power• Ability to reach customers in the segment—and the cost

to reach• Existing competition in the segment• Level of satisfaction with competitors offer• Predicted growth• Potential profitability• Barriers to entry

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WhatWhatWhat are we trying to sell?

• The what—or product—can be a good, a service or an idea

• Defined by intended use: business product is intended for a business purpose; consumer product is intended for consumer use

• Rarely does a company sell a single product: typically a hierarchy

• Product Item

• Product Line

• Product Mix

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WhatWhatWhat are we trying to sell?

Canned Canned SoupsSoups

Microwave Microwave SoupsSoups

GraviesGravies Meal KitsMeal Kits Tomato Tomato JuiceJuice

Chicken Chicken NoodleNoodle

Creamy Creamy TomatoTomato

BeefBeef Chicken Chicken PastaPasta

RegularRegular

TomatoTomato VegetableVegetable TurkeyTurkey Stroganoff Stroganoff PastaPasta

Low Low SodiumSodium

Vegetable Vegetable BeefBeef

Chicken Chicken NoodleNoodle

MushroomMushroom Chicken Chicken with Ricewith Rice

OrganicOrganic

French French OnionOnion

Creamy Creamy ChickenChicken

ChickenChicken Pork Pork Chops with Chops with StuffingStuffing

Healthy Healthy RequestRequest

More…More… More…More… More…More… More…More…

• The what—or product—can be a good, a service or an idea

• Defined by intended use: business product is intended for a business purpose; consumer product is intended for consumer use

• Rarely does a company sell a single product: typically a hierarchy

• Product Item

• Product Line

• Product Mix

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WhereWhereWhere are going to sell our products?

This is the “place” (distribution) part of the marketing mix and it defines making your product available when and where customers want it

Typically includes:

• Retail Stores

• Non-store Retail

• Vending

• Direct (e.g., door-to-door; person-to-person)

• Direct Marketing (call now operators are standing by, LL Bean)

• Electronic

• Online

• HSN

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WhenWhen

When are we going to promote?

•Promotion=Communication by marketers that informs, persuades and/or reminds potential buyers (target market) of a product in order to influence their opinion or elicit a response

• Elements include advertising, public relations, personal selling, and sales promotion

• Main function of a promotional strategy is to convince target market to buy

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WhyWhyWhy are they going to buy our product?

• We have a competitive advantage…

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WhyWhyWhy are they going to buy our product?

• We have a competitive advantage…the set of unique features of a company and its products that are perceived by the target market as significant and superior to the competition.

• Typically includes one or more of

• Quality

• Rapid delivery

• Low price

• Superior service

• Unique feature

PositioningPositioning

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By understanding the Who, What , Where, When and Why you are then best able to create a Positioning for your product/brand

What are your key takeaways from the book…what are the things you must know in order to position your product/brand?

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PositioningPositioning

• Positioning is the place a product, brand or Positioning is the place a product, brand or service occupies in consumersservice occupies in consumers‘‘ minds minds relative to the competitionrelative to the competition

• Generally speaking, a firmGenerally speaking, a firm’’s positioning s positioning tries to leverage its competitive advantagetries to leverage its competitive advantage

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Classic Differentiated Positioning Framework

For ________________________ _________________

(Target segment) (Product/brand)

is _______________________

(Most important claim/Unique Selling Proposition)

among all __________________________________________

(competitive frame)

because ____________________________________________

(support, reasons why, benefit)

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Classic Differentiated Positioning Framework

For Younger Men , Axe grooming products (Target segment) (Product/brand)

Will make you sexier

(Most important claim/Unique Selling Proposition)

compared to all other grooming products (competitive frame)

Because girls go crazy over it… (support, reasons why, benefit)

http://www.youtube.com/watch?v=fDmRiw8XdDU

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ILLUSTRATIVE EXAMPLE: ESPN Positioning

For Serious Sports Fans, ESPN is the best at delivering

sports information and entertainment among all media

companies because it enriches the lives

of the fan through its authority, passion, humor and storytelling.

Positioning ExamplePositioning Example

For deadline dependent people, FedEx is For deadline dependent people, FedEx is the overnight package delivery service that the overnight package delivery service that is most reliable because of its is most reliable because of its sophisticated tracking technology.sophisticated tracking technology.

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http://www.youtube.com/watch?v=wGoM_wVrwng

A Word on PapersA Word on Papers

• Better than most – usually never give Better than most – usually never give anything above an A-/B+ on first paperanything above an A-/B+ on first paper

• Grades ranged from B- to A- with 2/3 a B or B+Grades ranged from B- to A- with 2/3 a B or B+• My expectation is that papers will get better My expectation is that papers will get better

as semester goes on so I grade accordingly; as semester goes on so I grade accordingly; and I give more weight to last paper than firstand I give more weight to last paper than first

• My criteria: is this Clear, Concise, CompellingMy criteria: is this Clear, Concise, Compelling

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For next week: For next week: Pick a Brand - 1 Page PaperPick a Brand - 1 Page Paper

• How would you describe the positioning How would you describe the positioning of the brand?of the brand?

• What is its competitive advantageWhat is its competitive advantage• What are 2-3 key marketing messages What are 2-3 key marketing messages

in support of CA and positioningin support of CA and positioning

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Snack Food SegmentationSnack Food SegmentationNutritional Snackers

Weight Watchers

Guilty Snackers

Party Snackers

Indiscriminate Snackers

Economy Snackers

% of Snackers 22% 14% 9% 15% 15% 18%

Lifestyle Characteristics

Self-assured, controlled

Ourdoorsy, adventuresome

Highly anxious, isolated

sociable hedonistic Self-assured, price sensitive

Benefits

Sought

Nutritious, all natural

Lo-cal, quick energy

Low cal, good tasting

Guest satisfaction, goes well w drinks

Good tasting, satisfies hunger

Low price, good value

Snack consumption level

low low heavy average heavy average

Usual snack Fruit, veggie, cheese

Yogurt, veggies Yogurt, cookies, candy

Nuts, chips, crackers, pretzels

Candy, ice cream, cookies, chips

No specific usual

Demographics Well educated w young kids

Young, single young./old female, lower income

Middle-aged, suburban

teens Well educated, large families

Goldfish